Live Nation - Porters 5 Forces with References

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Date Submitted: 11/23/2010 02:26 PM

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Porters Five Forces Model

Michael Porter first created the five forces as a model to distinguish the intensity of competition in the industry. Three of the forces are based on external factors and two based on internal factors.

Here is a diagram of the five forces:


Live Nation’s rivalry seems to be the aspect of the five forces that is most unique. The fact that they own every aspect of their artist’s sources of income makes Live Nations market monopolised. Since the merger with Ticketmaster they have become an utilised company, the decentralised organisation lets each unit of the business do complete tasks in an organised and functional manor. As an industry giant they have set the code of conduct from which other companies may now follow if to compete with their practice.

As Live Nation are the only export of artists signed to them they have the ability to change prices as they feel necessary for each individual and supply to meet consumers demands. An example of this would be adding extra dates onto tours; this is possible as they own many venues as well as having equity in venues they use alongside sponsorships with sports teams, with facilities such as amphitheatres, which they subsequently have access to.

Live Nations top 10 Venues

1. The Wiltern

2. Electric Factory

3. The Gramercy Theatre

4. The Fillmore Auditorium

5. House of Blues Sunset Strip

6. Commodore Ballroom

7. Murat Centre

8. Dodge Theatre

9. Blossom Music Center

10. Toyota Presents the Oakdale Theatre

Foreign countries may create rivals that are not found in the United States as business that resides in their own country may have a better market situation. In 2008 ‘approximately 36% (Live Nation)’ of Live Nations revenue came from foreign operations. During 2009 the falling exchange on the pound may have left Live Nation with marginally lower revenue as putting on events in the United Kingdom is already one...