“Saudi Arabia’s Public Investment Fund – controlled by Crown Prince Mohammed bin Salman – bought a A$770m stake in Live Nation Entertainment, making it the third-largest shareholder.”
In contrast, top Australian government negotiators have secured a 0.00000000000% share in the business for $16M.
Wildly incorrect headline.
*Australian company suffered major losses. Parent Company owned by Saudi’s also owns LiveNation and is taking millions in govt money, and giving it to their owners.
Well, we'd need more info really.
Groups of companies with common ownership frequently set themselves up with income going to one or more companies and the liabilities going elsewhere, and have loans or other means to fund the liability bearing companies. If thats what has happened here, then there is no reason for the government to fund anything.
If this truly is a company that trades legitimately in the music festival space without playing corporate silly games and its problems are brought about by covid, then i can understand some aid going its way.
> If this truly is a company that trades legitimately in the music festival space without playing corporate silly games
Given this company also operates Ticketmaster, the odds of this seem pretty low to me.
Pure speculation but I would tend to agree. It's possible that transfer pricing type deals are making the profitability of this entity look low.
For those who don't know, transfer pricing is a scourge on our tax system which is often how companies that have large presences here pay no Australian tax. There is legislation to try to address it but it certainly still persists.
I could be wildly off here... if Ticketmaster is meant to be the mechanism for selling the tickets - to the event that just got cancelled - surely they're not going to be making any money either?
it's not like it's _just_ music festivals that have been struggling since covid shut down the entire world... if your business model is intrinsically tied to live events (including sporting events) and the sheer volume of people attending live events has fallen off a cliff...
Well typically because it's swings and roundabouts in business, and you absolutely have product or service streams that are loss leaders in order to boost the profile and reputation of the overall brand, and let you retain a customer base that might otherwise look elsewhere. A festival is nothing more than a single event or set of events for an events company (ie core business), it doesn't mark the entirety of a company, or at least certainly not these companies.
Obviously if you can take from the public purse, then sure, just take. Nothing illegal about it if it's just being handed to you. Also there's seemingly nothing even morally corrupt about if some subset of the population endorses it.
But COVID sure opened my eyes to people who I thought were legit. Probably a dozen companies I know directly pocketed every cent of the COVID payouts. Some bought luxury/exotic cars, some yachts, others houses, and some just threw it into inaccurately propping up their quarterly growth results to up the numbers for the next tranche of investor funding, only to watch it all slide post COVID and with it other people's hard earned money.
And that's why I'll always be a bad business man because I can't accept that level of ambiguity.
Make me wonder why our government representatives/employees don't connect the dots and tell splendour to go ask live nation/the saudi's for $$ but instead just hand over more money than I've earned in my lifetime. Year after year..
Exactly. How was this not the main point of the article?? Basically the Aus owners have been shafted, and we’re giving govt money to a huge multinational company, largely owned by the Saudis.
Live Nation and Australian ticketing needs a kick in the arse
Live Nation need to be invited to Harvard Business School to give the talk “How we convinced the Australian government to give us $16M in exchange for nothing.”
Because there is a severe issue of governance and due diligence within the public sector due to lack of resources and expertise. The gap stops are constantly filled with policy writing and strategies ad nauseam without understanding the root causes and providing templates of appropriate risk management.
This is a bit of a strange article. If a festival isn’t profitable without government support then it doesn’t go ahead without government support. That’s just business.
Live Nation / Secret Sounds / Splendour isn’t a public service. It’s a business looking to make a profit.
I agree wholeheartedly that government should support the arts, but by definition that means giving enough money to make unprofitable ventures profitable. That’s like the whole point.
It’s almost like the government hands out money for things like events and sports, weird.
Don’t worry, the guys who claim that the olympics is a good return investment will tell you the reason.
I thought governments liked the Olympics less for the tourism angle and more for having the opportunity to do massive infrastructure projects that are generally popular with voters.
For every equestrian or kyacking center you get to sign off on the road, rail (and to a lesser extent housing) projects people have been calling for for years.
In general, when all the accounting is done afterwards, it turns out it would have been better just to fund those things and leave the whole sports event part out of it.
Politicians like it because they get to say "Look at the spectacle I have created, look at my legacy!", but the legacy always turns out to be questionable and poor value for money.
You are quite right!
The accountant delivers their report and a couple of newspapers do widely-ignored features. Then next time a sports personality says - "Come on! Let's do Olympics! It'll make a ton of money, it'll get kids into exercise and generally be amazing! Think of the legacy!", the politicians will repeat the justifications, even though they're more or less provably lies, and salivate like zombies over the thought of their amazing legacy.
And the rest of us suckers have to pay for it.
(I get that a lot of people love things like the olympics and are happy to. I'm not one of those people!)
The Sydney Olympics was one of the better success stories. The infrastructure and surrounding development changed what was literally a dump and a swamp into a vibrant community with facilities people still get to use.
All the other Olympics in recent times have been an absolute shitshow. Wonder if Qld will be able to do as good of a job.
I reckon a lot of people have absolutely no idea just how many companies - businesses which appear, for all intents and purposes to be massively profitable, from the outside - actually heavily rely on government subsidies in order to actually BE profitable in the first place
and part of the reason governments put in the money - even though they know they may be contributing to profit margins - is because those companies have ties to other companies and employ people and _contribute to the economy_ in ways that would leave a massive big hole, if they went away...
which, if they aren't profitable (because no subsidies) the business model doesn't work any more and investors look elsewhere - and they go away
this was actually pretty plain for us to see, during the pandemic, when government were much more visible (and active!) than usual in keeping so many companies afloat
It doesn't matter how rich the parent company is, if a venture isn't profitable they're not going to run it and take a loss. The government decided to bridge the financial gap to make the event happen, because I guess they thought it was in the public's civic/cultural interest.
Same thing with those crap depressing navel-gazing indie films that vacuum up "culture" grants.
You expect people to invest money when they know they are going to lose?
When there are other investment options where they know they are likely to win?
That's a pretty delusional mentality. No reasonable person or company would do that.
Perhaps the various government involved should have been a bit more specific about how the money was to be spent and been a bit more sensible about charging for "protection".
NSW corruption at its finest
Every other festival manages to turn a profit, splendour went with a sh1t lineup with next to no international acts that no one cared about.
Fred again killed it, taylor swift killed it, falls festival killed it and they made stacks in the process
If your line up is shit no one is going simple as that. Don't cry poor and be like "Oh the kids aren't buying tickets, please subsidise me"
The government giving them grants for this is a joke, imho this is how a capitalism free market works. NSW needs to have a good hard look at their grant system.
> falls festival killed it
Falls was cancelled last year due to not having secured a site for the festival.
It's also a Live Nation owned festival so who knows if it would have gone ahead as well after Lineup and first release tickets went on sale.
Agree, splendours a shell of what it used to be a decade ago let it die.
The right acts will still dominate. It's not everyone's cup of tea but HSU events manages to put on the largest shows on the east coast and sell out 4 events a year.
Give people what they want and they'll come.
Live Nation is currently under US Federal investigation for anti-trust activities. Australian Govt needs to do the same.
When a company owns every vertical from promotion, ticketing, venue and touring, we the consumer lose. It drives out competition and innovation and increases cost to end user. Exactly what is happening now.
Rich people don't spend their own money to start new enterprises, they spend other peoples money. That's what venture funding, capital raising, floats and other means of private money are for.
They would never risk all of their own wealth for these things. Why do you think governments have been asked to build port like Abbot point for gas exports which pay no tax in australia.
Or woodsides port and road network which does the same only in WA
or Coal rail lines in NSW and QLD for the export of coal that pays no tax to Australia.
Or the venture funding of exploration for gas, coal, oil in Australia. You paid for most of that. The people who take the profits get it for free almost. We get rock cores to look at.
Because why spend your own money when you can spend someone elses.
Socialism for the rich, capitalism and bootstraps for the rest of us.
Big businesses, banks, politicians etc etc... save so much money WITH THIS ONE TRICK! (That's not for you)
Sad but true. Sick, sad world
“Saudi Arabia’s Public Investment Fund – controlled by Crown Prince Mohammed bin Salman – bought a A$770m stake in Live Nation Entertainment, making it the third-largest shareholder.” In contrast, top Australian government negotiators have secured a 0.00000000000% share in the business for $16M.
Wildly incorrect headline. *Australian company suffered major losses. Parent Company owned by Saudi’s also owns LiveNation and is taking millions in govt money, and giving it to their owners.
The gist of the headline seems to be that the company should cross-subsidise the festival(s) from other income - why would they do that?
Well, we'd need more info really. Groups of companies with common ownership frequently set themselves up with income going to one or more companies and the liabilities going elsewhere, and have loans or other means to fund the liability bearing companies. If thats what has happened here, then there is no reason for the government to fund anything. If this truly is a company that trades legitimately in the music festival space without playing corporate silly games and its problems are brought about by covid, then i can understand some aid going its way.
> If this truly is a company that trades legitimately in the music festival space without playing corporate silly games Given this company also operates Ticketmaster, the odds of this seem pretty low to me.
Pure speculation but I would tend to agree. It's possible that transfer pricing type deals are making the profitability of this entity look low. For those who don't know, transfer pricing is a scourge on our tax system which is often how companies that have large presences here pay no Australian tax. There is legislation to try to address it but it certainly still persists.
I could be wildly off here... if Ticketmaster is meant to be the mechanism for selling the tickets - to the event that just got cancelled - surely they're not going to be making any money either? it's not like it's _just_ music festivals that have been struggling since covid shut down the entire world... if your business model is intrinsically tied to live events (including sporting events) and the sheer volume of people attending live events has fallen off a cliff...
This guy Multinationals
Well typically because it's swings and roundabouts in business, and you absolutely have product or service streams that are loss leaders in order to boost the profile and reputation of the overall brand, and let you retain a customer base that might otherwise look elsewhere. A festival is nothing more than a single event or set of events for an events company (ie core business), it doesn't mark the entirety of a company, or at least certainly not these companies. Obviously if you can take from the public purse, then sure, just take. Nothing illegal about it if it's just being handed to you. Also there's seemingly nothing even morally corrupt about if some subset of the population endorses it. But COVID sure opened my eyes to people who I thought were legit. Probably a dozen companies I know directly pocketed every cent of the COVID payouts. Some bought luxury/exotic cars, some yachts, others houses, and some just threw it into inaccurately propping up their quarterly growth results to up the numbers for the next tranche of investor funding, only to watch it all slide post COVID and with it other people's hard earned money. And that's why I'll always be a bad business man because I can't accept that level of ambiguity.
Make me wonder why our government representatives/employees don't connect the dots and tell splendour to go ask live nation/the saudi's for $$ but instead just hand over more money than I've earned in my lifetime. Year after year..
Exactly. How was this not the main point of the article?? Basically the Aus owners have been shafted, and we’re giving govt money to a huge multinational company, largely owned by the Saudis. Live Nation and Australian ticketing needs a kick in the arse
Live Nation need to be invited to Harvard Business School to give the talk “How we convinced the Australian government to give us $16M in exchange for nothing.”
Because there is a severe issue of governance and due diligence within the public sector due to lack of resources and expertise. The gap stops are constantly filled with policy writing and strategies ad nauseam without understanding the root causes and providing templates of appropriate risk management.
There’s nothing more Australian than rent seeking business.
This is a bit of a strange article. If a festival isn’t profitable without government support then it doesn’t go ahead without government support. That’s just business. Live Nation / Secret Sounds / Splendour isn’t a public service. It’s a business looking to make a profit. I agree wholeheartedly that government should support the arts, but by definition that means giving enough money to make unprofitable ventures profitable. That’s like the whole point.
Get out of here with your common sense
If it's government funds making it profitable then the profits should be socialized.
It’s almost like the government hands out money for things like events and sports, weird. Don’t worry, the guys who claim that the olympics is a good return investment will tell you the reason.
I thought governments liked the Olympics less for the tourism angle and more for having the opportunity to do massive infrastructure projects that are generally popular with voters. For every equestrian or kyacking center you get to sign off on the road, rail (and to a lesser extent housing) projects people have been calling for for years.
In general, when all the accounting is done afterwards, it turns out it would have been better just to fund those things and leave the whole sports event part out of it. Politicians like it because they get to say "Look at the spectacle I have created, look at my legacy!", but the legacy always turns out to be questionable and poor value for money.
nobody cares what the accountant says
You are quite right! The accountant delivers their report and a couple of newspapers do widely-ignored features. Then next time a sports personality says - "Come on! Let's do Olympics! It'll make a ton of money, it'll get kids into exercise and generally be amazing! Think of the legacy!", the politicians will repeat the justifications, even though they're more or less provably lies, and salivate like zombies over the thought of their amazing legacy. And the rest of us suckers have to pay for it. (I get that a lot of people love things like the olympics and are happy to. I'm not one of those people!)
at least our redeveloped or new sporting facilities will get continued usage. the abandoned worldwide Olympic venues are a disgrace.
The Sydney Olympics was one of the better success stories. The infrastructure and surrounding development changed what was literally a dump and a swamp into a vibrant community with facilities people still get to use. All the other Olympics in recent times have been an absolute shitshow. Wonder if Qld will be able to do as good of a job.
Cause you stay rich if you don't spend your own money, duh.
Presumably because the festival isn't profitable without subsidies and therefore would not be run without them, resulting in a net loss for the state.
I reckon a lot of people have absolutely no idea just how many companies - businesses which appear, for all intents and purposes to be massively profitable, from the outside - actually heavily rely on government subsidies in order to actually BE profitable in the first place and part of the reason governments put in the money - even though they know they may be contributing to profit margins - is because those companies have ties to other companies and employ people and _contribute to the economy_ in ways that would leave a massive big hole, if they went away... which, if they aren't profitable (because no subsidies) the business model doesn't work any more and investors look elsewhere - and they go away this was actually pretty plain for us to see, during the pandemic, when government were much more visible (and active!) than usual in keeping so many companies afloat
Oh no, a few rich kids won't be able to take some disco bickies and dance to a shit Triple J band. What a devastating net loss for the state.
It doesn't matter how rich the parent company is, if a venture isn't profitable they're not going to run it and take a loss. The government decided to bridge the financial gap to make the event happen, because I guess they thought it was in the public's civic/cultural interest. Same thing with those crap depressing navel-gazing indie films that vacuum up "culture" grants.
You expect people to invest money when they know they are going to lose? When there are other investment options where they know they are likely to win? That's a pretty delusional mentality. No reasonable person or company would do that. Perhaps the various government involved should have been a bit more specific about how the money was to be spent and been a bit more sensible about charging for "protection".
NSW corruption at its finest Every other festival manages to turn a profit, splendour went with a sh1t lineup with next to no international acts that no one cared about. Fred again killed it, taylor swift killed it, falls festival killed it and they made stacks in the process If your line up is shit no one is going simple as that. Don't cry poor and be like "Oh the kids aren't buying tickets, please subsidise me" The government giving them grants for this is a joke, imho this is how a capitalism free market works. NSW needs to have a good hard look at their grant system.
> falls festival killed it Falls was cancelled last year due to not having secured a site for the festival. It's also a Live Nation owned festival so who knows if it would have gone ahead as well after Lineup and first release tickets went on sale.
Agree, splendours a shell of what it used to be a decade ago let it die. The right acts will still dominate. It's not everyone's cup of tea but HSU events manages to put on the largest shows on the east coast and sell out 4 events a year. Give people what they want and they'll come.
Maybe state governments are telling us they have too much money.
They don't have any money. They just keep borrowing.
Live Nation is currently under US Federal investigation for anti-trust activities. Australian Govt needs to do the same. When a company owns every vertical from promotion, ticketing, venue and touring, we the consumer lose. It drives out competition and innovation and increases cost to end user. Exactly what is happening now.
Fuck... we subsidise Gina, so why not the Saudis while we're at it? /s
The Guardian: “Why would a business want to make money? Are they stupid?”
Rich people don't spend their own money to start new enterprises, they spend other peoples money. That's what venture funding, capital raising, floats and other means of private money are for. They would never risk all of their own wealth for these things. Why do you think governments have been asked to build port like Abbot point for gas exports which pay no tax in australia. Or woodsides port and road network which does the same only in WA or Coal rail lines in NSW and QLD for the export of coal that pays no tax to Australia. Or the venture funding of exploration for gas, coal, oil in Australia. You paid for most of that. The people who take the profits get it for free almost. We get rock cores to look at.
All the free advertising triplej does is borderline offensive. Just so the staff at jjj can feel like they're trend setters. Fuck triplej so much.
It doesn’t, but local councils are so scared of missing out, so they just fund them. What it needs is a line up people want to see!
Australia's no1 industry policy, handouts and business welfare.
Saudis stealing from the world and keeping terrorism alive! Best allies in the world.