Live Nation Inc. [
LYV] chairman Michael Cohl has
resigned from the company's board of directors and his post as CEO of its Live Nation Artists division following a protracted
dispute concerning the company's contracts with major artists. Cohl, who favored giving artists so-called "360" deals in which the company received a cut of the artist's sales of albums, concert tickets, t-shirts and other merchandise, will serve in a consulting role, according to Live Nation's
statement about the matter.
Live Nation was spun out of radio and outdoor advertising giant Clear Channel Communications Inc. [
CCU] in 2005 and owns the
Fillmore and
House of Blues brand names, having
acquired the latter for $350 million in mid-2006. While much of the music industry is suffering due to CD duplication, piracy and a fitful transition to digital delivery methods, the live music business is
prospering.
For Live Nation, signing artists such as Madonna and Jay-Z to 360 deals represented either an update of the label/artist relationship or a needless move away from the company's core competency of live music and into selling CDs, a weaker part of the industry. A debate over whether to accelerate the 360 deal strategy was
reportedly the source of friction between Cohl and Live Nation CEO Michael Rapino, apparently resulting in Cohl's departure.
Live Nation shares were down 27 cents, or 2.3%, in morning trading Monday, but have lost more than 20% of their value since the beginning of June.
-- Paul BonanosSee press release from Live Nation announcing Cohl's departureSee June 20 post from Tech Confidential about Live Nation execs' feudSee previous Deal stories about
live music's resurgence and
Live Nation's acquisition of House of BluesFor more see June 12 Wall Street Journal
story
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