For the international contemporary live music industry

Ozzy sues AEG as MSGC ramps up venues war in UK

World News
March 30, 2018

 As Audience went to press it was revealed Ozzy Osborne has filed an anti-trust lawsuit against venue operator AEG, over its policy of blocking artistes from playing rival venues in London and Los Angeles.

The lawsuit seeks to put an end to AEG’s so-called Staples Center Commitment, which seeks to prevent acts from playing its flagship UK venue The O2 (cap. 21,000) in London, unless they also agree to perform at AEG’s Staples Center (20,000) in Los Angeles.

AEG claim it introduced the policy after MSGC, owner of Madison Square Garden (19,000), and its off-shoot Azoff MSG Entertainment tried to force artistes to play their LA venue The Forum (17,500), under threat of perhaps not getting a date at the iconic New York arena if they chose the Staples instead (see Audience issue 210),

In the lawsuit, Osborne’s lawyer Daniel Wall of Latham & Watkins in San Francisco accuses AEG of “blatant, anti-competitive conduct”.

It comes after the promoters of Osborne’s No More Tours 2, Live Nation Entertainment (LNE), attempted to book dates at The O2 for February 2019, which they were told were available, but only if he played the Staples.

LNE signed, despite Osborne preferring to play The Forum.

“The Staples Center Commitment unfairly leverages AEG’s dominance in Greater London to distort and deter competition in Greater Los Angeles,” says Wall in the lawsuit.

“The harm to competition is profound, immediate and irreparable.”

AEG’s chairman and CEO Jay Marciano says, “This suit is without merit and we will vigorously fight it.

“We welcome a closer look at the global live entertainment market and, specifically, our practices and the practices of our competition,” he says, “AEG has always worked hard to put artistes first. Fighting for a level playing field is fair competition at its core.”

To add further fuel to the flames, AEG has called into question proposals by MSGC, to build an arena in East London, just four miles (6.3kms) from The O2.

AEG claims the new arena will add to “congestion” in the area, which already has several major venues. AEG’s promoting division AEG Live also manages The SSE Arena – Wembley (12,750) in the north-west of the city.

“AEG has always worked hard to put artistes first”

Jay Marciano

Undaunted, MSGC says it expects to submit a planning application in the autumn for its proposed 20,000-capacity sphere-shaped music venue, situated on a five-acre site in Stratford (see Audience issue 217).

“AEG understands competition in the live music industry and does not oppose the principle of a new music venue in London,” says an AEG spokesman.

“However, there is a question mark over whether such a venue should be located in East London, so close to existing venues at the Olympic Park – such as the London Stadium [80,000] and Copper Box [7,500] – as well as, The O2.”

Also located nearby is Printworks (5,000), which recently launched a second live music space, with a capacity of 3,000.

Speaking during a launch event in London, MSGC president Andrew Lustgarten dismissed concerns the market was becoming over-crowded.

“We chose Stratford for its connectivity,” said Lustgarten. “We simply want to grow the market and introduce new forms of entertainment to London.”

Meanwhile, it has been revealed that AEG has earned £300 million ($371.1m) in dividends since taking over the then Government-owned Millennium Dome and opening The O2 a decade ago.

The venue posted revenue of £96.7m ($119.6m) in 2017, with profits rising 13.3 per cent to £33.5m ($41.4m). The total number of events also increased by 16 from the previous year to 208, while attendance was up by 500,000 to 2.7m.

As part of the deal with the Government, AEG got the land free by agreeing to pay 15 per cent of the venue’s net profits to the Government for 25 years.

Last year the Government share amounted to £5m ($6.1m), taking the overall figure paid so far to £24.5m ($30.3m). The Dome cost £789m ($1.11 billion) to build, estimated to be the equivalent of £1.25bn ($1.414bn) today.

Artistes playing The O2 include Fall Out Boy, Sam Smith, Harry Styles and Katy Perry.

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