Live Nation has updated its artist contract terms for the 2021 festival season to potentially lessen the financial risk to the promoter on putting on large-scale events post-COVID-19.

In a recent memo sent to booking agency partners, the firm details several changes including ticket pricing being at the sole discretion of the promoter.

It also states artists will receive 25 per cent of the guarantee if a show is cancelled due to poor ticket sales, which could be an issue in the post-COVID festival scene. In addition, artist guarantees will be adjusted downwards by 20 per cent from 2020 levels.

Live Nation, which owns ticketing giant Ticketmaster, said in the memo: “The global pandemic has changed the world in recent months and, with it, the dynamics of the music industry.

“We are in unprecedented times and must adequately account for the shift in market demand, the exponential rise of certain costs and the overall increase of uncertainty that materially affects our mission.”

Other changes include new payment terms, with artists to receive a deposit of 10 per cent one month before the festival, contingent on an executed agreement and fulfilment of marketing responsibilities.

The live entertainment giant also said artists will be required to maintain their own cancellation insurance as the “promoter is not responsible for the artist fee in the event of a cancellation of the festival due to weather or a force majeure.”

Live Nation concluded: “We are fully aware of the significance of these changes, and we did not make these changes without serious consideration. We appreciate you – and all artists – understanding the need for us to make these changes in order to allow the festival business to continue not only for the artists and the producers, but also for the fans.”

Major concerts and festivals across the world have been forced to cancel due to COVID-19 with more than 50,000 Live Nation events impacted by the live events blackout.

Live Nation said in May it would not return to “full scale” concerts until 2021, with the entertainment giant focusing on alternatives, such as livestreamed shows and drive-in events.

The firm announced the strategy as it reported a 21-per-cent year-on-year drop in revenue for its first quarter to $1.37bn, with ticketing down 16 per cent.

Live Nation reported a seven-times increase in operating losses from the same period in 2019 at $172.7m due to the widespread cancellations and postponements.