Live Nation will end its agreement with Ticketmaster in 2009 and the two will become competitors for concert tickets. LN has a strategic alliance with CTS Eventim to build its own ticketing system which will be used at LN events and inside LN buildings.

SMG, which manages about 200 major venues, had stayed out of the fray. But with the deal, announced September 11 by Live Nation, SMG will begin transitioning its buildings’ ticket sales to Live Nation Ticketing in late 2009. Live Nation said it it will sell an estimated 5 million tickets annually by 2011 as SMG’s current ticketing contracts expire.

Live Nation estimates the agreement with SMG will bring in sales of about 25 million tickets over the life of the deal.

In the first year of operation, LN Ticketing is expected to handle more than 10 million tickets for Live Nation alone, the company said. As House of Blues contracts with Ticketmaster expire and those tickets come online, that number increases to 13 million by 2010. And the addition of incremental tickets included in the SMG deal represent an estimated 25 percent annual increase from the 13 million LN Ticketing will service to its own venues.

“This alliance increases our expected total ticket inventory by 25 percent over the next seven years, and that’s before we even flip the switch on Live Nation Ticketing,” LN Ticketing CEO Nathan Hubbard said in a statement. “The fact that SMG, the world leader in venue management, has selected our new ticketing platform as its exclusive service provider validates that our unique content plus ticketing proposition delivers a double win via one single provider.”

SMG President Wes Westley said in a statement such a deal will “enhance our ability to drive content to our venues.”

TM CEO Sean Moriarty obviously took a different view, telling the Wall Street Journal that SMG does not have the ability to make such an agreement for the municipally owned buildings it runs, which require competitive bidding. “We will continue to compete on an individual basis for all venues seeking ticketing services,” he added.

However, SMG neutralized Moriarty’s statement, telling the paper only a “small fraction” of the buildings require competitive bidding.

The WSJ pointed out that the 25 million annual ticket sales are worth up to $60 million in ticketing fees. It was uncertain at press time if this meant Live Nation plans on implementing a service charge, rather than burying it in the face value of the ticket, and sharing the revenue with SMG.