IAC/InterActiveCorp’s Ticketmaster, the largest U.S. ticket seller, said it was not able to reach a new long-term agreement with its largest client, concert promoter Live Nation Inc.

In an internal memo sent to employees on Wednesday, Ticketmaster said that a year’s worth of renewal negotiations with Live Nation over its ticket sales had left the company “doubtful we will extend our agreement when it expires at the end of 2008.”

“We are now conducting our business with the clear understanding that our partnership with LiveNation is more than likely coming to an end,” Ticketmaster said in the memo signed by Chief Executive Sean Moriarty and Chairman Terry Barnes, a copy of which was obtained by Reuters.

Live Nation and its House of Blues subsidiary generate about 15 to 20 percent of Ticketmaster’s revenue, which in total topped $1 billion in 2006.

The dispute spanned several issues over the role of box office services and their relationship to the consumer base buying into a concert or event, from branding and inventory levels to the ability to market directly to fans, a source familiar with the matter said.

Live Nation has moved to strengthen its position in selling tickets and boosting its ties to music and sports fans populating its shows, including its purchase last year of a majority stake in Musictoday, which operates fan clubs and Web sites for hundreds of music acts.

Ticketmaster said in the memo it would focus on strengthening its ties to some 9,000 clients worldwide and other players in the entertainment and events industries.

The company has set its sights on becoming a marketer and merchandiser of live entertainment, stepping deeper into the territory of introducing consumers to new events and artists.

Ticketmaster, along with local partners, is the box office service for the 2008 Olympic Games in Beijing. In the past year the company bought a stake in music networking Web site iLike.com and reached an agreement to be the official ticketing provider of the National Basketball Association, including oversight of a ticket resale program.

Ticketmaster is also a key driver of profit growth at IAC, the Internet conglomerate controlled by media veteran and Web investor Barry Diller. In its most recent quarterly results, the unit posted an unexpectedly weak sales volume, pushing its operating profit down 24 percent.

Live Nation officials were not immediately available for comment late on Wednesday.

Copyright © 2007 Reuters Limited.