Editor's note

In our last News we included an article on Access All Areas, the British Council / Export Music Sweden trade event to take place in Stockholm at the end of this month. This story had the heading 'Behind the Music'. This phrase is one that we shall apply to articles that highlight the work and the co-operations of the increasingly varied organisations, companies and individuals that are becoming more and more important to the development of the international music industries.

The structures are changing, and the live business will find itself working with new partners. The major record companies are merging and will change the ways in which they operate, Sony and BMG have an agreement, Time Warner will decide this Thursday who they get into bed with, most likely EMI, it is likely that these new conglomerates will concentrate on their assets, back catalogue, TV manufactured acts etc. At the same time the growing recognition of a broader band of music genres as assets to be encouraged and developed as resources for both economic and cultural export by authorities ranging from national and regional governments to arts funding bodies is leading to these organisations becoming more and more active in the talent development areas once the province of the record companies. The live industry should welcome new opportunities to become 'cultural disseminators' and offer its expertise to make the most of these new enterprises.

In this somewhat 'themed' News we report on the continuing work of Conamus and the ETEP scheme, PopPlus in Cologne and also on a new Convention in Sardinia - I make no apologies for reporting in detail the themes that they have outlined for their panels, as in the light of my preceding comments, I think that their programme accurately identifies very essential issues for the present and the future.

 

New opportunities and present problems for music in the Mediterranean territories are to be highlighted by the founding of the Mediterranean Entertainment Conference, to take place on the island of Sardinia, in Olbia at the Melià resort & Conference center on 5/6 December 2003.

The stated aim of the Conference as outlined by Giovanni Broccu is: The Promotion of grassroots creativity through the establishment of a circuit of promoters, managers and independent record labels with the contribution of public authorities at local level (Municipalities, Provinces and Regions) and at European level (European Commission cultural programs).

 

Music Export Cologne is setting up a symposium concerning subsidization for popular music and the opportunities for the exploitation of talents abroad. PopPlus Europe will give an overview of the pop music organisations in Europe in general and put a special focus on the live music business

As the opportunities to raise public support for pop music in Germany is very limited compared to many other European countries, PopPlus Europe will provide information about what is going on in other countries. Speakers include, amongst others: Fritz Rau, Dieter Gorny CEO of Viva, Jens Michow, President IDKV. Jean-Francois Michel, Director of the European Music Office in Brussels, will deliver the Key Note speech. The dates for the symposium are November 28 & 29 in the Stadtgarten in Cologne.

 

The 10 th edition of the MTV European Music Awards (EMA) became a monument of Pop. For years the music station MTV has already delivered well designed events of it's own class. For the anniversary the station may even produced a masterpiece. The event which takes place on November 6 in Edinburgh in Scotland was a lesson in terms of the production and conception for a live music event in TV.

There has so many been highlights this year, that it would simply be to much to mention them all. Christina Aguilera as the host for the show is already a statement with a message. Fortune favours the brave as the 22 years old singer did the job as a moderator very well. Another significant issue had been several life performances as part of the show. In many cases the responsible folks at the entertainment departments at the TV station prefer play back sets when it comes to the appearance of pop stars at TV shows.

 

This increasingly important double festival has announced plans for the 2004 edition. Eurosonic, the European showcase festival will definitely see an increase on the number of acts appearing, well over 150 are expected to perform in a variety of venues in Groningen in Northern Holland over three days, January 8-10.

ETEP:
After the success of the first edition in

2003, The European Talent Exchange Program will be continued and developed at ES/NS. This co-operation of European festivals, radio stations and EuroSonic/Noorderslag, aims to encourage the opportunities for, and the diversity of, European bands performing at European ETEP festivals throughout Europe, and to ensure radio and media support. Last year some 24 European acts performed over 50 festival shows at 25 different festivals. As with last year, the selection of acts for ETEP will be made at ES/NS.

 

Well, if Elvis has left the building, Elton is soon to enter it, the singer, songwriter and pianist has confirmed a deal reported to be worth £30m for 75 shows at the famous Caesars Palace in Las Vegas. "I cannot do this show anywhere else in the world," said Sir Elton. "It's back to costume changes and Velcro."

To fulfil this agreement the 56-year-old Elton John will appear five times a week

for five weeks a year for three years starting next February. The shows will take place in Caesars Palace's 4,100-seat auditorium, The Colosseum, originally built for Celine Dion who had her own three year stint presenting her musical show, A New Day (I'll bet some people went every night - it doesn't bear thinking about!). Sir Elton will perform his show, The Red Piano, when Dion is on holiday from her own three-year contract. As a pianist Elton follows in the footsteps of the legendary Liberace, he was one of the great attractions in Las Vegas, playing regularly from 1944 to 1986.

 

The first pan-European CD in the guise of a book has been released by top independent label Ninja Tune, featuring artist Kid Koala. The CD is zero-rated for VAT as a book in the UK. An ordinary CD is not treated as a cultural product and would attract top rate VAT. The release coincides with a rally at the Finance Ministry in Brussels to take place at 11am this coming Thursday 20th November, to exert pressure on Finance Ministers ahead of the 25 November EcoFin meeting in Brussels.

Protestors include rights holders across the music spectrum - from authors, composers, music publishers, performing artists, artist managers, independent and major record companies, entertainment retailers and collective management societies. This is to highlight the absurdity of EU VAT of the VAT discrimination between cultural products that currently applies in the EU. The AIM/Ninja initiative is supported by Impala (The international independent record companies and publishers trade association) as part of its pan-European campaign for VAT equality between music and other cultural products.

 

The Color Line Arena opened just one year ago on November 8 in Hamburg. The venue filled a gap in the availability of first class locations in the northern part of Germany and became a regular spot for events and concerts. The Arena has attracted more than 950,000 visitors to 119 shows, 38 of which were sold out. The capacity of the arena is 16.000 for concerts and 13.000 for sport events. So far Color Line Arena has hosted shows by Tom Jones, Santana, Shakira, Christina Aguilera, Mariah Carey, Peter Gabriel and Meat Loaf, as well as concerts from André Rieu, Helmut Lotti and Udo Jürgens, amongst others

Regarding the booking situation for 2004, Dirk Mittmann, Head of Marketing explained to Vip News: "Despite the lack of shows in the Summer, we already have several bookings for 2004. In the next year, the second for the Color Line Arena we expect to present 130 shows and events." According to the company, improvements are planned to create business lounges for new opportunities for corporate entertainment. Another aim is to increase the visitor figures to 1,3 million visitors.

 

The German music magazine Intro moves forward in the open air festival market. The Melt! Festival which did not take place this year will join forces with Intro magazine for next years festival edition. Stefan Lehmkuhl, head of the event department of the magazine will take care of the booking and certain marketing measures like CD for the festival and the CI of the event. The Melt! Festival combines Electro and Rock music. Together with the former promoter Bittersweet, Intro will promote the seventh edition of the festival on July 16 to 18, 2004 at the Ferrepolis area in Gräfenhainichen in Saxonia Anhalt. Furthermore Intro will open an office in Berlin in spring 2004. Lehmkuhl moves to the German capitol and is running his business from there. The magazines already promotes this years indoor events like the Introducing -Festival and the club concert series Intro Intim. Especially Intro Intim is a double event, which take place in Cologne and Berlin.

 

The Liverpool UK music venue set up with help from Sir Paul McCartney, Yoko Ono and Pete Townsend is to close. Years after the after the closure of the original Cavern Club, Liverpool is to lose another seminal venue, considered as a launch pad for some of the city's best-known bands.

The Picket club staged the first gigs of bands such as Space, Cast and The La's, after being set up during the 1980s recession to help the city's emerging musicians. Philip Hayes, the venue's manager, said that despite last-ditch attempts to save it by Travis, Blur and many of Liverpool's music community, The Picket was on the brink of closure.

 

On November 8th Music2Deal launched its Dutch language version of the internet forums: Songs2Deal.com, Artist2Deal.com en Vocals2Deal.com. These sites are online market places where songwriters, performing artists and vocalists can meet music industry professionals on the hunt for songs, artists or vocals for their projects. .

Originally a German initiative, Music2Deal.com is now represented in 7 territories and more than 10 countries. Over 700 music industry professionals have registered with the sites, including representatives of all major record companies. The large supply of songs and performers can be searched easily and the site's construction aims to provide an alternative to sending demo tapes and promo materials around the world.

 

The Business Report season is with us again. So far the 3rd quarter results have been published for Clear Channel and CTS Eventim, DEAG will release their results on November 25.

Clear Channel delivers impressive figures while the results themselves reveal the differences in profitability of the particular company segments. In Germany CTS Eventim shows a very solid performance in revenue and earnings while DEAG are taking the opportunity to raise capital to restructure their debt management.

 

Clear Channel (stock symbol CCU at New York Stock Exchange-NYSE ) reported a 3rd 2003 quarter total turnover of 2.54 billion USD and net earnings of 636 million USD. Clear Channel Entertainment (CCE), the part of the company controlling the live business of the corporate giant achieved a turnover of 936,231 million USD in the same period, and achieved earnings before interests, taxes, depreciation and amortisation (EBITDA) of 96,811 million USD.

Even though these figures appear quite impressive compared to the results of the radio division of CCU in reality they are not. In Q3-2003 the turnover of the radio business at CCU was 963,635 million USD almost equal to the Entertainment division, but with a reported EBITDA result of 427,140 million USD the profit margin of the radio segment of the company clearly highlights the difference.

 

It appears that CTS Eventim (EVD.FSE) is doing very well in 2003. The turnover results until the end of Q3-2003 report 172.1 million Euro (Q3-2002/ 106.1 million Euro). The Live Entertainment division contributed 153.1 million Euros to the overall turnover while the Ticketing division made 23.8 million. In Q3-2002 the revenue for Live Entertainment was indicated with 91.5 million Euros, with Ticketing at 15.7 million. All key figures moved up, as did the earnings of EVD.

The earnings before interests and taxes (EBIT) for the ongoing year reached 14.1 million Euro in Q3 2003 (0.5 million Euro in Q3-2002), while the EBITDA is 17.8 million Euro compared with 3.3 million Euro the year before. The EBIT of the Live Entertainment section moved up to 12.8 million Euros from 3.3 million in Q3-2002, while the EBITDA for Q3-2003 in this division is 13.1 million Euros (3.6 million in Q3-2002).

 

Before DEAG reveal the Q3 results on November 25, the company has now announced that it will issue new shares and additionally a combination with stock warrants. The offer is available to Shareholders of DEAG, who could purchase the papers in a ratio of 2:1. DEAG will release 4.538.350 shares at 2.33 Euro each. The nominal value for the stock warrants is 1.48 Euro each, the number of issued bonds is 4.583.350. The stock warrant is a so-called zero bond and offers a yearly interest of about 16% until 2006.

In reference to this measure the Auric Group and KTG Technologie Beteilungsgesellschaft along with Peter Schwenkow, the CEO of DEAG have offered to bring in 10.2 million Euro under special conditions, which is 65% of the total value of the capital measure. In addition to this, the involved banks declared a renunciation of liabilities of about 11.8 million Euros.

 

Clear Channel (CCU.NSE): since Vip News November 5. 2003 where the CCU share was worth 41,10 USD, the price suffered a slightly loss of 0,22 USD and now costs 40,88 USD

CTS Eventim (EVD.FSE): 7,05 Euro last time, this time due to the good Q3 results another step forward up to 7,40 Euro

DEAG (ERM.FSE) has not released Q3 results yet. If the capital measure pays out (see Vip News -Business News above) DEAG could get rid of most of the debts until the end of the year. Compare to the reported 2.69 Euro last time, the share price has not change significantly and just moves up to 2,75 Euro

Mean Fiddler (MEF.FSE) one more time keeps the level. 20,50 Pence was the indicated price in our previous newsletter, while the current price is 21,00 Pence.

 

Fluid Media is managing to capture a market share of the event and entertainment business in South Africa and is providing a superior service to some of South Africa's biggest companies.

Director, Jarrod Aston, has been involved in the industry since he was a small boy. He was born into an entertainment family and spent many nights living in theatres and on the road with some of the biggest shows to be staged in the country.

As one of the youngest promoters and producers of events, Jarrod has fresh ideas and a sound record in the local market. Apart from his local experience he has worked with many top agencies and management companies throughout Europe, USA and SE Asia.

Having worked with acts such as Vanessa Mae, Dionne Warwick and Jonathan Butler to name a few, the company is committed to advancing the standards of the industry, not only locally but also internationally, with a professional approach towards unique ideas whilst redefining the attitude towards the South African market.

 

Marc Kirchheim Entertainment Consulting GmbH is an internationally-oriented commercial agency for star acts, personalities and high-carat artistes with a focus on the event sector, the advertising and industrial sector

Nationally and internationally renowned stars and artistes offer a wide variety of options in event marketing and other sectors of the communications industry for image transfer to products and services as well as effective media presentations of very different kinds.

Our direct contacts with celebrities and our know-how in event marketing enable us to offer professional consulting when it comes to the stars and personalities for your special events - perhaps the appearance of an artiste, a patron or a guest of honour at an evening gala, trade fair, product presentation, kick-off function, company anniversary or incentive event.

We advise you on what stars fit in with your concept and we offer cost-effective celebrity endorsements according to the type of event, your budget and their availability.

But our work doesn't stop with negotiating a celebrity appearance. We also offer professional advice in all legal aspects of the events industry. Examples include contract law, non-performance or deficient performance of contracts, limited tax liability (known as non-resident tax), sales tax, artists' national insurance contributions, copyright and ancillary copyright / GEMA and GVL [German performing rights and ancillary copyright associations].

We can, on request, see to all the logistical arrangements, such as flight and hotel reservations, transfers, security and other services associated with the usually comprehensive contracts for stars and artistes.

 

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