On 9 November 2020, the first Coronavirus vaccine was found by Pfizer and BioNTech to be safe and effective.
Not least in sectors most affected by the pandemic, this was big news. Shortly after entertainment ticket company, Live Nation, saw a 22% jump in share price, a second vaccine was announced. Dozens more are set to be ready by January.
Live Nation’s trajectory mirrors other event and ticket companies like CTS Eventim and DEAG, as well as non-musical entities like airlines. They are confident that live music will bounce back; an August report by the company found that 86% of customers have kept their tickets and CEO Michael Rapino “expects shows at scale” to be back by summer.
Meanwhile, Ticketmaster, one of Live Nation’s many subsidiaries, are planning a system which would require fans to verify that they had received either a vaccine or a negative test before attending their events. Not only are companies predicting a brighter future, but they are taking steps to prepare for it.
Given that the pandemic is far from over, this optimism might seem misplaced. Faisal Majeed, an independent investor from Milton Keynes, says he is not currently planning on making any long-term investments, despite “vaccine euphoria” providing temptation to do so.
“It will be difficult for markets to go a lot higher from here without going down first. They’ve gone up too fast over the past month and need to build a stable base lower and then move up above current levels,” he said.
“Price will come majorly down one more time and that’s when it will be wise to start buying.”
A fear that the economy is still too unpredictable is shared by larger investors. George Travell of S&P Global, a company in whose index Live Nation debuted last year, suggests that, while some investors clearly believe Live Nation will do well in the long run, current trend is not an accurate indicator of recovery.
Live Nation Share Price (Reuters)
He said: “Broadly speaking, you can look at the S&P 500 and the state of the US economy during Covid. There is almost no similarity.
“There are plenty of examples of companies being overvalued; that is, bubbles which highlight how the market isn’t a true reflection of a company’s worth.”
This, as well reports by the Financial Times that, while the world economy tumbles, billionaires’ wealth has increased by 27% since March, points to a disconnect between the market and reality. Those working at ground level may yet find it difficult to be cheerful.
“Live Nation are making loads of money off live streamed gigs, but the grassroots industry is not in a position to charge for a livestream,” said Amy Kinsella, Senior Promoter at HOT VOX in London.
“But then on the flipside of that, if it all comes back, we might miss out on the first big boom of gigs. There is very much a mindset that February, March, April will be full on back to normal gigging.”
Ms Kinsella also said that London grassroots entities are seeing precious little of any government stimuli. Consequently, the live industry is being forced into a position where they must be wilfully ignorant to survive. Both regionals and nationals are using live streaming as a means of staying afloat, but larger companies are better equipped to play the waiting game. The real danger of collapse is to Britain’s small venues, promoters and musicians, on whom the sector is reliant but rarely thankful for.
The moment we believe that live music is dead is the moment we lose it. But while we should remember that optimism is never misplaced, we should accept that neither is patience.
Image: “Isle of Wight Festival Stage” by David Jones is licensed under CC BY 2.0
