Canadian rock band Nickelback latest music act to join Live Nation

According to a Billboard report Tuesday morning, Live Nation Inc. (NYSE: LYV) "has entered into a long-term global partnership" with Canadian rock band Nickelback, following other high profile acts U2, Madonna, and Jay-Z. The reported $50-$70 million deal is set to commence after the band finishes its current deal with Road Runner Records, a record label in the Warner Music Group Corp. (NYSE: WMG), and will include three tours and albums with the possibility of a fourth left open. Virtually every aspect of the band's career will be managed and distributed via Live Nation, and the band will begin touring in Live Nation venues as soon as next year.

Reuters further reports that the band has two albums and a greatest hits album left with Road Runner Records, with the band's last album selling 10 million copies. The news source speculates that the deal could be expensive if the band's new albums in the future fail to deliver the success that the band has enjoyed to date. The deal also throws into question the value of Road Runner Records after Warner Music Group bought the label in December 2006 for $73.5 million. Despite other high profile artists, Nickelback is the label's most successful act.

Live Nation has raised the stakes for music companies since beginning to sign major artists last year. By offering services for nearly every aspect of those acts' careers, Live Nation means managing careers are simplified in theory. In addition, the growth of the digital music market has made it easier for the company and the acts it signs to distance the services from the tendencies associated with music companies and traditional recordings deals. Unfortunately, since the deals have yet to commence for any artist, the success of deals such as this have yet to be seen.