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Top Concerts Go Dark as Biggest Promoters Cope With Virus

Live-Entertainment Groups Postpone All Large Shows Due to Virus

(Bloomberg) -- The live-music business is shutting down for the foreseeable future.

Live Nation Entertainment Inc. and Anschutz Entertainment Group, the world’s largest concert promoters, postponed events in arenas through the end of the month to protect fans and artists from the spreading coronavirus. Smaller events will continue, subject to local and state guidelines.

The biggest companies in the live-music industry have formed a task force to address the global pandemic, which has killed thousands of people and left the global economy in crisis. The group includes top executives from Live Nation, Anschutz, Creative Artists Agency, William Morris Endeavor Entertainment, Paradigm Talent Agency and United Talent Agency.

The industry is already reeling from the cancellation of South by Southwest, a major music festival in Texas, and the postponement of the Coachella Valley Music and Arts Festival, one of the largest music events in the world.

The cancellations come as the industry heads into its busiest season, the summer. Billboard magazine reported earlier on Live Nation’s suspension of arena tours.

“It’s a total mess,” said John Tinker, an analyst with Gabelli & Co. “The next few days is the critical period.”

No one is saying how long the break will last, or how far it will spread. While some shows will be rescheduled for the fall, many others might not take place until next year. Anschutz had already postponed Coachella to October from April.

Live Nation is postponing events in the U.S. and other countries deemed risky by the Center for Disease Control, but not globally. It’s seeking to limit shows in arenas and some clubs and theaters, but not all venues. The company is still talking to artists about which shows will be postponed or canceled.

Taking Hits

The cancellations and postponements will hurt Live Nation, Eventbrite and other live-event companies for months to come, Tinker said.

Shares of Live Nation, the industry’s biggest player, fell 14% in New York on Thursday, a big loser in a broad market rout. Since Feb. 19, the company has lost about $8.5 billion in market value. It’s concert business generated sales of $9.4 billion in 2019, while ticketing made $1.5 billion.

Artists and promoters were at first reluctant to cancel events en masse. Musicians have come to rely on live music as their primary source of income, especially after record sales plummeted earlier this century. As recently as Thursday, artists such as the Killers and Niall Horan were announcing new shows. Most of the major musicians on tour were still selling tickets to shows.

But the threat to public health became too much to ignore.

“I had all of the intention to perform on this tour, but with my team and due to the current global climate, we had to make this decision for the safety of our fans, tour crew and more,” Colombian singer Maluma said in a statement. “This was also highly recommended by government officials for the safety of everyone.”

Economic Fallout

Artists, promoters and ticket sellers are still assessing the economic costs, including events that have only been postponed. But cancellations have never happened on this scale before, according to Rene Siemens, a partner at Covington & Burling who specializes in insurance recovery.

The cancellations will squeeze thousands of people who rely on live music for their livelihood, including artists, club owners, promoters, ticket sellers, food vendors and crew members. The organizers of South by Southwest fired one third of their staff after canceling the events.

SXSW fans who bought tickets to these events will be refunded if they are canceled outright, or they are unable to attend the new date, according to statements on the ticket sellers’ websites. But many of these ticket companies were overwhelmed with requests Thursday.

“It’s really devastating to the local economy, specifically the economy downtown,” said Kristen Carson, the founder of a local hospitality business called Inn Cahoots. Carson said her business lost 8% and 12% of its annual revenue from the cancellation of South by Southwest. Some of her friends lost much more.

“A lot of the big, big loss is around food,” she said.

To contact the reporter on this story: Lucas Shaw in Los Angeles at lshaw31@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net

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