WHEN: Today, Monday, March 21, 2022
WHERE: CNBC's "TechCheck"
Following is the unofficial transcript of a CNBC interview with Live Nation Entertainment CEO & President Michael Rapino and Verizon CEO Hans Vestberg announcing a new Verizon and Live Nation 5G technology partnership on CNBC's "TechCheck" (M-F, 11AM-12PM ET) airing today, Monday, March 21st. Following is a link to video on CNBC.com: https://www.cnbc.com/video/2022/03/21/verizon-and-live-nation-ceos-announce-new-5g-partnership.html.
All references must be sourced to CNBC.
JULIA BOORSTIN: Thanks Deirdre. That's right, we're gonna be joined now by Verizon CEO Hans Vestberg and Live Nation CEO Michael Rapino as they announced a 5G technology partnership and included in the partnership which is pretty wide ranging, Verizon will be outfitting venues across the US with 5G ultra-widebands so concert goers can stream, share photos and videos and download content at much faster speeds than 4G and there is a new first access program that will make millions of tickets to Live Nation tours available to Verizon customers via the my Verizon app also giving access to select streaming concerts. Joining us now to discuss that and more are Michael Rapino, CEO of Live Nation, and Hans Vestberg, CEO of Verizon. Thank you both so much for joining us this morning and breaking this news on "TechCheck." Michael, let's start with you. What does this partnership really mean for Live Nation's bottom line?
MICHAEL RAPINO: Well, first of all, thanks for joining Hans and appreciate having us on. Hans and I've been talking for over a year now about the ways we can use his great new technology 5G to finally empower all of our venues and shows. As you know when you go to a concert, it's 50/50 whether you can find a reception, whether you can post a picture, whether you can phone your your friends. So the idea now that all of our venues will be lit up with this very efficient 5G, it's just going to make it so much better for the fan whether they just want to post a picture, TikTok or we can now start figuring out ways we can engage with that customer on site from upgrades to special merchandise to special access.
BOORSTIN: Very interesting. Now Hans, give us your perspective, in addition to just having this be part of the the broader rollout of 5G, what does this mean in terms of your relationship with Verizon customers? Why is it important to give them early access to either ticket sales or streaming and do you think that will help pull over customers from rival mobile carriers?
HANS VESTBERG: First of all, thank you Julia for hosting us here. And Michael and I talked for a long time and we have these are actually an extension of our partnership and and clearly what we see in in these types of venues the importance of connectivity in order to be part of the immersion experiences, and our strategy has been all the time to be on those places with with an iconic sort of music or live sports and Live Nation is of course the iconic brand here that we're working with in all the concerts and theaters they have across the country to see that they have a really good technology as a platform and that from that platform, we will then start together innovate new fan experiences, new ways to to actually consume these fantastic music or whatever it is in these concert places. So that's one piece of it. The other piece, of course, the trend that we see happening in the market. That's of course going direct to the consumer either us to the first access where we will offer millions of tickets to the more than 100 million consumers we have as a first access, which is a great opportunity. We have already seen that because we already launched the first batch of it and enormous demand from our customers. And then finally of course working with Michael and his team when it comes to their direct to consumer, their streaming service which you know we have worked with many others like Disney+, Discovery+, using our platforms and then innovate together with a partner like Live Nation. That's what we're doing. Here today so it's just a great way to see that the fans, our customers, and the people experience with this getting an even better experience.
JON FORTT: Michael, great to have you. Good morning, it's Jon. So I've got mixed feelings about smartphones at concerts. I mean yes, they're great and everything but have you quantified the financial value of streaming video and digital images on social media as marketing for live events and how does 5G perhaps change the calculus if you had? Does it make, does it make live events easier to market even if people may be in the moment or paying less attention to what's in front of their face?
RAPINO: Yeah, it's a great question. You know, we we kind of look at our fan as the promoter. You know, the great part about the concert business, it's a, it's a Kodak moment. Everyone has to post that moment when they're there. It's a special moment in their history. So, you are right if you're on the first Harry Styles concert in New York and 20,000 people are posting and reposting and I've still got 70, 80 shows to sell throughout the world, that momentum every night of Instagram, social, TikTok, all the ways those fans are, help spread the word is incredible valuable marketing to us. We've been talking about this for years on how the customer really takes the show to the consumer for us. They are our best word of mouth advertising and that has provided us billions of impressions around our shows and our experiences and our festivals. This just highlights it and unlocks it to a whole new level now.
DEIRDRE BOSA: Hey, Michael, it's Deirdre. In that vein, I wonder though who owns the customer. Earlier this year, you said that live streaming is the compliment and promotion to the core concept. I think that's what you're saying now. But I wonder is big tech looking at it the other way around and could that potentially be a threat to your business? I mean, on a virtual platform, artists are able to reach millions of more viewers, they are able to able to interact in a different way. So how urgent is it for you to sort of build up these tech and virtual tools to own the customer?
RAPINO: Yeah, I want to define though the physical event is the magic, right? The two hours that you go live down to MSG to watch that show. That's the non-duplicatable part. So that's the part we've seen over obviously through COVID and now roaring back. That's the part you can't get online. You can't get through your TikTok video. You gotta to be live to make it happen. So that's our magic sauce, the two hours now. Now any ways that we can take that two hours and help market it, enhance it, complement it, we think that's great for our business and our fans and for the artist. So, we think these extensions, marketing, adding value to the show are great extensions. The two hours though still is the money shot that has to happen live to get the goosebumps.
BOORSTIN: Now when you talk about extensions, I think it's notable that in this press release that just went out, you also talk about augmented reality features and also NFTs, NFTs Hans that you are going to give the opportunity for Verizon customers to acquire. Tell us how this is going to work or how this could fit into a broader strategy with NFTs?
VESTBERG: No, the broader strategy is clear. First of all, I just want to echo what Michael is saying and remember that the uplink on 5G, when you send up data when you send TikTok, etc., the limitation is basically on any technology except 5G. That's why we saw the Super Bowl that people can send up everything if you're on 5G and that's what we're going to do in this in the venues as well and we need to understand that these youth, these fan base, they want to do different things at the same time, using the phones, using, looking the visuals but nothing will replace a real concert or a real live sports event. That that is really the cream of the premium when it comes to being live. But you can replicate it in an ambassador's word and that's what we create. On top of that then of course you can start creating immersive experiences which we did together with Michael and his team during the halftime show at Super Bowl where you basically have 8K cameras behind the the whole event in the halftime at Super Bowl and you can access that. You can be wherever round these players or these rappers and that's what you can do and then you can create NTFs on that you can do a lot of things. So this platform that we're putting in that is really where it's, you start doing innovation for the fans experience and and there are multiple things you can do. And that's also what NTFs comes in in the whole picture for us. So I think we have built a Verizon intelligence network in our ultra-network for Metaverse, even though we didn't know a Metaverse was actually existing when we started with the network.
BOORSTIN: Yeah, yeah, certainly an advantage to have that kind of broadband. I want to take a step back from the news of the day and just look at what's going on more broadly in the economy right now. Obviously, there's inflation. There's economic uncertainty, certainly which which has a bigger impact in terms of Live Nation, what's going on in Europe with the Russian invasion of Ukraine. And I'm wondering if if both of you and I'm going to start with you, Michael can give us a sense of what these different factors are doing to your business outlook. Michael, I know when in February, you gave a very bullish outlook for 2022. It was before the the invasion of Ukraine and also before some of these inflation indicators spiked. What are you seeing right now? Are you any less optimistic than you were a month ago?
RAPINO: First of all, thank you and obviously what's happening in Russia, Ukraine is horrible and we're doing everything we can to support and see how this plays out. We are, you know, unfortunately we don't have a lot of shows in that area so that hasn't really affected our business. Europe seems to be business as usual right now for the summer so we haven't seen any disruption in our core business around the world in terms of touring. We don't see the inflation effectiveness yet. You know, I think we've talked about in February, we had such a a 24-month shutdown that the pent-up demand is so big right now for the customers this summer. We're still tracking 30% plus up year over year, we're seeing consumers buying tickets on sale this weekend. We had sold out festivals this weekend. So I do believe that the pent-up demand over the last two years is going to power through any short term inflation issues. Tickets seem to be flying out of the door both from the front seat to the back. So we're looking still for a record '22 across the globe.
BOORSTIN: And Hans, I would pose a similar question to you. What's your sense of the impact of inflation on consumer spending and the kind of activity you're seeing among your Verizon customers?
VESTBERG: As well, first of all, I kinda want to agree with Michael, it's horrible what we're seeing right now in Ukraine and all of that, and we decided to waive any calls and texts to Ukraine for all our customers in order to see that they can communicate. And of course, we have a consumer base, base only in the US. And if you look at that, there there's so far no impact from what's happening in in Europe on that consumer base. Of course, we have the inflation but one thing that has happened in the last two years is that the mobility broadband and cloud services is essential infrastructure and essential service for each and every one in these countries. Of course, when we now, for example, launched our fixed wireless access as a broadband solution, we have seen a great demand for that. Our mobility service continues to be very strong. So I think that this is essential today to operate your business in this hybrid world because that's where we want to live, where people want to work from home sometimes or being on the road and seeing that technology work. So actually, we see a good demand for our business. That pulled a bit, of course, all the new offerings. And recently this morning, I have to say that we're also launched that were pulling in more spectrum earlier. We're actually clearing the spectrum one year ahead more spectrum so that we're going to launch some 30 more markets this year, which is already very vast on our 5G ultra-wideband network. So now we continue to pull through. We're going to follow what's going to happen of course.
BOORSTIN: Well, well, thank you so much for the business updates from you both and also for breaking the news of your partnership here on "TechCheck." Hans Vestberg, Michael Rapino, thank you both so much for joining us. And Jon, I'm gonna send it back over to you.