Michael Rapino - President, Chief Executive Officer, Director Kathy Willard - Chief Financial Officer, Executive Vice President

Mark Wienkes - Goldman Sachs David Joyce - Miller Tabak & Co., LLC Tuna Amobi - Standard & Poors [Alan Gold] Julie Heckman - Morgan Joseph & Co.

Welcome everyone to the Live Nation first quarter 2008 earnings conference call. (Operator Instructions) Before we begin, Live Nation has asked me to remind you that this afternoon's call will contain certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ. Please refer to Live Nation's SEC filings for a description of risks and uncertainties that could impact the actual results. Live Nation will also refer to some non-GAAP measures in this call. In accordance with SEC Regulation G, Live Nation has provided a full reconciliation for the most comparable GAAP in the earnings release on their website. The release reconciliation and other financial or statistical information to be discussed on this call can be found on LiveNation.com under the About Us section. It is now my pleasure to turn the floor over to Michael Rapino, Chief Executive Officer.

Welcome to our 2008 first quarter conference call. On today's call I'll provide a summary of Live Nation's strategic progress, and then Kathy Willard, our Chief Financial Officer, will provide commentary on our financials. During the first quarter we continued to execute on our strategic plan to maximize our concert platform and fully capitalize on our global leadership position in the live music business. Our mission is to create a company that acquires and distributes live artists' rights with discipline, innovation and accountability while maximizing shareholder value. Our competitive advantage lies in our global concert platform that spans multiple cities throughout 19 countries, staffed by the most experienced promoters and marketing personnel in the business, selling directly to over 40 million fans, servicing 1,000 artists annually through our 16,000 concerts. Our focus for 2008 is very clear. We are continuing to concentrate on three main priorities - optimization and expansion of our core distribution platform, investing in and developing our online ticketing platform for our 2009 launch, and reducing debt through additional sales of non-core businesses. During the quarter we made great progress and are on plan regarding our ticketing build out. The core operational team is hired and in place. The CTS system is now deployed in our data center and hardware in North America. CTS continues its development work to adapt the system to market, however our team is already building events, selling, printing and scanning tickets. We continue to refine our North American platform by exiting low-growth markets and expanding in the top 20 markets. The agreement to acquire the majority of the live music assets of Fantasma Production, a leading Florida-based promotion company, is part of this growth. The acquisition includes Fantasma's calendar events, two important outdoor midsize music venues, and two outdoor music festivals, significantly strengthening our position in the Florida market, where we historically have been underdeveloped. Our new House of Blues club in Houston is nearing completion, and construction of our House of Blues in Boston has begun. We expect both clubs to open during the fourth quarter of 2008. North American Music also launched in a European-style three-day festival outside of Vancouver called Pemberton, headlined by Coldplay, Tom Petty and Jay-Z. Initial sales are on route to an anticipated sellout its first year, an incredible achievement by the team. We increased our International live platform through our agreement to acquire a 65% stake in Dubai-based Mirage Promotions. As well, we acquired the operating company that managed the Heineken Music Hall, Amsterdam's premier music venue, consistently ranked in the top 10 highest-attended music venues in the world, and continued to strengthen our Holland operations, which is our third-largest division in Europe. Over the longer term, our business model is driven by two levers - the acquisition of artists' rights and the monetization of our distribution platform. During the first quarter we continued to make progress in strengthening these levers. First, our business model is powered by filling our distribution platform with the right talent at the right price. As the largest acquirer of live artists' rights, we have a team of over 400 buyers regionally and centrally that are continually ensuring our distribution pipes are offered at high occupancy. We promote over 16,000 concerts across our platform on an annual basis, spending over $3 billion per year on artists and direct costs related to putting on these events. We acquire these live rights from over 1,000 artists, and we finance these outlays through our working capital. Over the last few years we've been moving to a central buying system for some of these rights on a global and longer-term basis, which has resulted in higher margins and more consistent flow for our pipes and our sponsorship model. Our core strategy for growth is determining how to make our $30 billion in event-related spend over the next 10 years work harder for us. We're doing this by acquiring more rights for a longer time period, with lockedin pricing, cross-collateralized for risk reduction. In 2008, we currently expect to acquire 16,000 local concert rights, over 40 national tour rights, one to three global tours, and to date, three long-term full rights deals with Madonna, U2 and Jay-Z. The Jay-Z deal demonstrates how acquiring long-term multiple rights for our pipes can produce higher margins than our current local concert model. With Jay-Z, we have acquired the following rights for 10 years, all crossed touring, ticketing, secondary ticketing, merchandise, sponsorship, endorsement, DVD, TV broadcast, VIP, fan club, website, publishing and recordings. We should generate, based on historic and forward modeling, a minimum of $340 million in revenue over the term and over $38 million in operating income, or an 11% margin versus our current North American 4% margin on single concert rights. We will share in approximately 21% of the total profit versus our current 10% model. We expect to advance Jay-Z approximately $100 million over the term as the rights are performed, which is standard practice. And we are off to an incredible start with this relationship as Jay-Z is just finishing his North American tour that will gross $36 million, the largest grossing tour of the year and the first hip hop urban artist to sell out the Hollywood Bowl in L.A. and five arenas in New York. And he has just begun the first leg and now headed to Europe for 25 more shows. The strategy behind the model is simple. We currently spend over $3 billion annually for the lowest-margin right in the value chain, and if we can leverage that $3 billion to acquire higher-margin rights and increase our perartist revenue, then we can incrementally increase our margin and maximize our distribution platform. The most expensive and lowest-margin artist right is the concert right. Leveraging our concert guarantee to add higher margin rights will produce higher returns for our platform. The incremental cost of acquiring and executing a Tshirt right is minimum, but produces increased margin to our bottom line. The outlook for the remainder of the year in terms of content looks very strong, and we are very confident we have adequate content to drive growth through our platform. A sampling of the North American concerts include the Jonas Brothers, Madonna, today Coldplay announced, Dave Matthews, Pearl Jam, Kenny Chesney and Alan Jackson. On the International side we have a strong lineup that includes Bruce Springsteen, Celine Dion, Eric Clapton, Robert Plant and Jack Johnson. Finally, as we have previously stated, we are not seeing nor do we currently expect to see any significant impact on our business stemming from the current economic slowdown. The second lever that drives our business model is maximizing the 46 million fans that walk through our distribution pipe. The key five levers that drive our profit in this platform are ticket sales, ticket fees, venue ancillary fees, sponsorship, and artist ancillary rights. In 2008 we will continue to use our growing database and online services to better market our shows and convert marketing dollars from traditional media to online in an effort to reduce overall spend through efficient reach. We continue to focus on increasing ancillary sales per fan, specifically in regard to food and beverage, through our continued discussions with Aramark as well as other companies regarding our concession contract. We remain confident that we'll replace our current concession contract with one that is more beneficial to Live Nation. Sponsorship continues to be the high-growth potential area, and after signing one blockbuster deal with Citi already, the team currently expects to close over 1,000 deals in 2008. We continue to elevate our average deal size as our proposition to sponsors has evolved over the last two years from a fragmented live on-site proposition to one now that we believe is the most compelling for sponsors looking to reach 46 million avid music fans and 1,000 superstar artists, onsite to online. Increasing our earnings per artist is another way we leverage our relationship with 1,000 artists annually. Live Nation Artists has assembled the world's leading full-service platform for artists, from merchandise and web store management to VIP services and live streaming. Our division houses nine unique services that we currently expect will acquire and execute over 1,000 ancillary rights in 2008, producing what we currently expect to be over $300 million in revenue with great growth potential. This is a new revenue stream we did not participate in three years ago. To conclude, we're off to a solid start in 2008 with regard to the execution of our strategic plan, and we look forward to another successful year for live music. All in all, the live music industry has grown at a healthy 10% compounded annual growth over the last decade and has assumed a pivotal position in the transition of the music industry. We believe that we are uniquely positioned to benefit from these trends. In the year ahead, we believe the benefits of our strategy and investment plan will become increasingly evident as we expand our relationship with artists, fans and sponsors and increase our participation in multiple high-margin revenue products around the live music experience. And now I'll turn it over to Kathy, who'll comment on our financial results.

In our first quarter earnings release today, we begin presenting adjusted operating income or loss on a consolidated basis and also by segment. Adjusted operating income or loss is a non-GAAP financial measure that the company defines as operating income or loss before depreciation and amortization, loss or gain on sale of operating assets, and noncash compensation expense. We are reporting adjusted operating income or loss in place of adjusted OIBDAN, which we have used in the past. This change was driven by feedback from investors, and we believe that using adjusted operating income or loss will be a simpler way to communicate our financial progress. There is no change in the calculation. We are simply changing the term, and this calculation may be similar to how some calculate EBITDA. Moving to our results, during the first quarter consolidated revenue increased $116.2 million, or 22% compared to the same period last year. The increase was primarily driven by a $15.5 million revenue increase from increased ticket revenues due to strong arena acts and improved results at promoted midsize music venues, as a result of higher attendance, increased show count, and higher average ticket prices for North American Music. Acquisitions accounted for $75.5 million of the increase and included $35.2 million from HOB Canada in North American Music, $16 million from AMG and Heineken Music Hall in International Music, and $24.3 million from Signatures and Anthill in Global Artists. In addition, we benefited from an increase of $10.8 million related to foreign exchange movement. For the first quarter of 2008, our adjusted operating loss was $2.1 million, an improvement of $0.7 million compared to an adjusted operating loss of $2.8 million during the first quarter of last year. The decrease in adjusted operating loss was primarily driven by a $1.6 million increase in North American Music related to our acquisition of HOB Canada and a $3.9 million increase in International Music related to our acquisition of AMG and Heineken Music Hall. These were partially offset by a $3.2 million increase in costs in Global Artists, which was expected as we continue to invest in our Global Artists infrastructure, and a $3.9 million increase in costs in Global Digital as a result of our efforts to build our ticketing initiative as well as our website and Internet operations. There were no significant changes to our core operations during this seasonally slow quarter. Operating loss increased 4.3% to $38.5 million from an operating loss of $36.9 million in the first quarter of 2007. The increased operating loss was primarily driven by a $7.2 million increase in depreciation and amortization expense due to amortization of intangible assets related to the AMG and CBI acquisitions in 2007 and a $1.1 million increase in noncash compensation expense for additional equity grants since March 2007, offset by the previously discussed $0.7 million improvement overall in the adjusted operating income and a $6 million increase in gain on sale of operating assets due to the gain recorded on the sale of a Motor Sports-related joint venture in 2008 as compared to a net loss recorded in 2007 on the sale of two noncore assets. Turning to some other financial metrics, capital expenditures for the quarter were $23.2 million, which included only $6.3 million of maintenance expenditures and $16.9 million of revenue-generating projects, including the renovation of The Point in Ireland and the AMG venue expansion in Sheffield. We remain focused on controlling maintenance Capex, and currently expect total maintenance capital expenditures for 2008 to be approximately $30 million. Revenue-generating projects for 2008 will include the completion of The Point in Ireland, our ticketing expansion, the HOB venue expansions in Houston and Boston, and the AMG venue expansions in Brighton, Sheffield and Leeds. We currently expect the total revenue-generating capital expenditures will be approximately $155 million for 2008. As of March 31, 2008, our reported cash and cash equivalent balance was $434 million and our debt and preferred stock totaled $804 million. We estimate our free cash flow, which is adjusted operating income or loss less net interest expense, cash taxes, maintenance capital expenditures and net distributions or contributions with minority interest partners and nonconsolidated affiliates to be a negative $24 million due mainly to the low adjusted operating income for the first quarter. We remain focused on the continued execution of our strategic plan and the strengthening of our integrated platform throughout 2008. For the full year, we continue to expect to generate modest growth in adjusted operating income and also expect to invest this growth back into our ticketing, digital ecommerce and Live Nation Artist Initiative. As we previously noted, we expect our ticketing initiative investments to have a $15 million negative impact to 2008 adjusted operating income. Given the progress we have made over the past two years and our current investment plans, we continue to believe that we will be in a position to deliver strong adjusted operating income growth in 2009 and beyond. With that, I will open up to questions.

(Operator Instructions) Your first question comes from Mark Wienkes - Goldman Sachs. Mark Wienkes - Goldman Sachs: Just wondering, today on Warner Music Group's call they talked about moving away from 360-degree deals. Have you seen that in the marketplace? What are you noticing when you're talking to the artists about these deals? And then also, for Kathy, could you detail the free cash balance for us?

There's a lot of talk on what is a 360 deal. We don't really use that terminology. We're in a very different business model than the records' 360 model. We business model is because we have the infrastructure, we have a merchandise company, we have a fan club company, we have a ticket company, a sponsorship division, a fan club, a VIP division, our goal is just to acquire all of those rights that we have infrastructure for to maximize our revenues. So as we said, we're going to sign over 1,000 rights this year, whether that's a T-shirt, that fan club rate or a merchandise right. That's our core strategy. Every now and then the Madonna's and the U2's will look to us and say, "We'd like to do all of that, and let's do it for a long-term period." And if the economics work for our pipe, then we'll look at that model. As much press as we've received, all of my intelligence tells me if you added up right now the record labels that I talk to, we have three what you would call 360 deals. I think they have somewhere in the 100 range on 360 deals because they're doing them with every young artist that’s out there. So from what I hear there's more and more attention every day to a longer, deeper relationship with the record label or ourselves, and we have a lot of artists who are asking us daily about is there a new way to be a business partner long term since we're probably going to be their touring partner.

On the free cash calculation which we've used in the past, which is our cash balance less deferred revenue plus prepaids to artists and less tickets sold to others, that balance is about $10 million at the end of the quarter, Mark.

Your next question comes from David Joyce - Miller Tabak & Co., LLC. David Joyce - Miller Tabak & Co., LLC: I was wondering if you could sort of give some color around why the average revenue per attendee was so strong. Is it for a particular kind of venue or just if you could discuss that?

And you understand, David, that number is calculated based on total revenue divided by attendees for the quarter? David Joyce - Miller Tabak & Co., LLC: Yes. Is it the - I was looking for the other disclosure that you had been providing, but I guess it's not there now. Is that going to be in a 10Q on all the events and attendees?

Yes. You'll be to divide it out and look on some of the North American show count versus revenue increases. Our goal in this release, we listened to a lot of investors and a lot of input on how do we get a release with a lot of tentacles to our model? How do we simplify the model, and how do we provide the Street with the key metrics that, if you look at those key eight metrics, if those are going up, our business is doing well and we're on our growth plan. So we tried to distill to a very top line but an important eight lines that says these are the eight things that fill the pipe and the cost to fill the pipe and then the ultimate cost per fan or revenue per fan. And we'll provide you more detail in the summer when we get into a lot more ancillary revenue per fan. David Joyce - Miller Tabak & Co., LLC: And Kathy, did you mention $150 million of venue expansion expense this year?

Yes, that's correct. David Joyce - Miller Tabak & Co., LLC: And you only did $17 million so far?

That's correct. Most of it's going to come in second and third and fourth.

Which we've announced the House of Blues Boston, the House of Blues Houston, The Point in Ireland, which will be a fabulous venue.

Ticketing and then three AMG venues.

Ticketing and three midsize venues in London that are all in varying degrees of progression to come online end of year, beginning of next quarter.

Your next question comes from Tuna Amobi - Standard & Poors. Tuna Amobi - Standard & Poors: I guess my first question, I was kind of writing furiously on the Jay-Z deal, Michael, as you were going through some of the details, and just wanted to make sure I understand the numbers. So when you talk about $340 million, right, is that like kind of the base case scenario? I'm just trying to understand what additional parameters could swing that number one way or the other.

When we built our 10-year models for these artists, someone like JayZ or Madonna or U2 have incredible long history, so the historic numbers are fairly easy to dig through to build a forward model. So we use all historic years of everything Jay-Z's ever done historically for years, how many T-shirts, how many concert tickets, how many fan club members, how many sponsorships. We would take all the historic data and then we would apply a discount factor to it for the future, and we would build a model that is a very base case conservative model that we would have presented to your. $340 is a very conservative revenue number that we will absolutely stand behind over the 10-year period. We have absolutely higher expectations as we unlock more and more sponsorship revenue and ticketing online opportunities. But the model right now is just based on a historic performance discounted going forward, so we have a [inaudible] history and said, "Jay's going to sell more records in Year 8 than he sold last year." And the greatest part about the JayZ model, a lot of people don't understand the power and the iconic state he has become in that genre of music. Our model built his historic touring performance and he just blew by every historic number he's ever done in history on this tour by being the largest single tour he's done in history, the largest arena tour of the year, and he's got a full year ahead of him. And we would assume he has got another 10 years of that and more in terms of his potential and his touring power. Tuna Amobi - Standard & Poors: What's the start date actually for this deal?

Well, we closed the deal on last Friday.

A week ago.

So we closed Friday, but we included all of the tour that started before the closing in this deal. Tuna Amobi - Standard & Poors: Okay, so the tour is included? That's what I was getting at.

That was the big win on, how do we get these deals so they're accretive day one and cash flowing instantly. Tuna Amobi - Standard & Poors: Okay, so just still on that theme, would you say, I mean, this is kind of the template that you would use? Because as I look at base side by side with the Madonna deal, there seems to be some differences, a few subtle differences. So I'm just kind of trying to draw comparisons in terms of the potential numbers what this might mean. I know you talked about 11% margin and Jay-Z's deal included entrepreneurial ventures and Madonna's did not, so I am trying to kind of compare what you think are the - which one would you say is the template in terms of your target numbers, what you're trying to accomplish in margin terms and return on investment, etc.

We had started the year by saying that we believed that there was a model, and the reason we provided a lot of context today is over the last few months the deals got a lot of press because it's easy for someone to talk about a $100 million JayZ deal. But out of context, we have to step back and go, "That's the business we're in." We advance artists for rights every day of the week. We do it for, we spend over $1.5 billion a year just on artists' rights a year, advancing an artist well in advance of his performance a guaranteed number, and then we recoup that through the performance. So we do this for a living. If we've been advancing Jay-Z over history and certain dates, when we bought a show in Chicago or bought five dates in London, our model is are there opportunities to take that $30 billion we're going to spend in 16,000 rights a year, fragmented pieces, which right now produce a 4% return, if we can model out business cases with artists that we believe have a strong touring future and can feed our distribution pipe and we can put together a 10-year model of touring and then extra rights, the return on capital and margin higher than our current 4%, that's a great model for us. If we could convert a lot of our artists into 11% margin, then we start to answer that question on how do we turn our business from 4% and how do we grow it. So our model is, we said at the beginning of the year we were going to go out with three or four founding artists U2, Madonna, Jay-Z and another one to come in terms of issuing some stock to those artists as an entry point and as a means to get four superstars to really sign up to this model. The good news is we have a lineup of artists that want to be in the top four. We will announce another one fairly soon. We will continue to execute against these four to prove our model out, and we'll continue to evaluate our capital and our working capital guarantee cost basis to figure out are there other artists who want to sign up for long term. Or, sometimes we're not doing a 10-year deal. Sometimes we're just doing an artist - if Justin Timberlake wanted to do a two-cycle tour deal with us and include T-shirts, we would look at that model. That may be better than just buying the local Justin Timberlake date for 4%. So anyway we can use our capital to acquire higher-margin rights, whether it's for a tour, a tour plus T-shirts, two tours, 10 years, six rights, eight rights, we have this incredible advantage that we already buy the lowest-margin right for the most capital. And maybe there's an opportunity to add other rights to that $30 billion we'll spend over the next 10 years and increase our overall margin.

Your next question comes from [Alan Gold]. [Alan Gold]: Following up on the Jay-Z contract, Kathy, could you just work through how that would run through the income statement and how the cash would be laid out?

No. We're not going to provide that detail today. The cash outlay is a combination of the activity. So we happen to be in cycle right now, so we do have a tour so we've advanced some cash for the tour rights. We have websites going and sponsorship and fan clubs.

And it would go through our prepaids just like they always do on artist advances. And the revenue and operating income that Michael spoke of would be going through our financial statements over the 10year term. [Alan Gold]: So whatever percent of that - whatever revenue comes in at about an 11% margin would be a good way to look at it right now?

Yes.

Yes. The revenue's going to come in. Some of it's a tour in North America. Some comes in Signatures, through merchandise. Some come in through Music Today for fan clubs. Some's going to come in our ticketing. But cumulatively, those 10 rights will split out somewhere in the $340 minimum revenue, the EBITDA we gave you, and that margin in our fragmented distribution pipe.

Your next question comes from Julie Heckman - Morgan Joseph & Co. Julie Heckman - Morgan Joseph & Co.: Okay, first off, can you explain the Citi deal in a little more detail, give a little more color?

Sure. As we've kind of put some context around today, we have a very large global sponsorship division that is every day doing local deals. It might be signage in an amphitheater. It might be an on-site display. And historically we have sold a lot of local and regional sponsorship deals mostly based on a venue on-site platform. One of the advantages over the last year is we've moved into having an online platform, having direct access to consumers, having a database, having access to tickets and now access to T-shirts and artists' rights. Our national sponsorship team has had incredible conversations with a lot of great companies on can they use our tickets, can they use our exclusive T-shirts, our VIP clubs, all of the great content we have to help drive their business model. And Citi would be the first deal where we would say is a demonstration that the sponsorship community is excited about our new platform of concerts, online ticketing and artist rights. And we took our average credit card category, where we've historically been with American Express, and we took that category and doubled it three or four times in terms of annual EBITDA that somebody was willing to pay us for access to our content. So Citi now has an incredible global database. They're helping market our shows and they have access to tickets and various exclusive content over the term to offer to their Citi cardholders. So we are very excited from a multi-marketing perspective, a cash flow perspective, and we think there are more Citibanks that will come to our platform over the next year as kind of our official sponsors. And Citibank's only a North American deal, so we have a similar situation in Europe on all of our content. Julie Heckman - Morgan Joseph & Co.: And are there any updates to guidance in 2008? Can you just run through your expectations for the year again?

No, we think we did a little bit of soft guidance on the first Q to help out everybody. We gave you a fairly good range on what we believe we will deliver this year from an EBITDA perspective. To date, half of my job is buying the talent. Now the second part is them coming to the shows and buying beers and parking and spending money. So the good news is on a Q1 we can say to you we feel very confident that we have the content to deliver our plan this year. We hope now that it's summer and it's hot and everybody drinks a lot of pop and beer and shows up, and as long as all of those 46 million fans come through the pipes and drink and eat and partake as expected, we believe we are absolutely on plan to the guidance we provided in Q1. By the Q2 we will have a closer idea on where we are. And as any of you have followed, the Q1 and Q2 are really not really relevant to the year. This is a Q3 make or break business where we do a majority of all of our business. So right now we feel great about Q3. We've got the inventory on a global basis, and we have all the levers in place to deliver what we think is a strong year. Julie Heckman - Morgan Joseph & Co.: Kathy, could you break out the $131 million of [elimination] revenue? I think some of it was feeder, but is there anything else in there?

We don't provide that detail specifically, but the main pieces that are included in there are Motor Sports and the U.K. theater business.

This does conclude our Q&A session.

Thank you, everyone. Have a good summer.