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Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Over on MainFT, Dan Thomas and Eri Sugiura have an interesting deep-dive on prospects for the Department of Justice antitrust action against Live Nation, the US events company.
They write:
The company is involved in the management of bands and promotion of events, driving revenues from advertising, sponsorship and upselling to VIP seats at its venues, parking, food and beverage and merchandise sales. The DoJ describes it as a “live entertainment ecosystem” that works as “a feedback loop that inflates its fees and revenue, all at the expense of fans”.
The article includes a reference to Live Nation’s “flywheel”…
Live Nation boss Michael Rapino has himself described the company strategy to investors as a “flywheel”, with the concerts at the core, aiming “to get into?.?.?.?high margin businesses and be competitive”.
The term has been taken up by the DoJ in its allegations over a self-reinforcing model while rivals complain of a flywheel that spins ever faster to throw out money.
…a diagram of which is also included:
The source is given as the DoJ, but actually the FT’s graphics team have done the US enforcers a solid here.
Here’s how the original (from the DoJ’s 2024 complaint) looks:
As soon as we saw that image, our brains started itching.
Let’s leave aside any technical discussions about motor design, and just look at the basic physics.
If you don’t want to waste time drawing on your screen, take our word for it: one of those diagrams looks like it would work, the other… not so much:
The diagram is, according to the complaint, “based upon Live Nation’s public filings” — specifically its 10-K for 2023 — but as far as we can tell this is an artistic interpretation rather than a direct recreation.
Tl;dr it us:
More importantly, what does this tell us about the DoJ’s prospects of reining in Live Nation?
It tells us nothing. Sorry for wasting your time.
Further reading:
— The truth about maximising efficiency
— Basel III: Endgame t-shirt
#DoJs #axles #evil