Ticketmaster is publicly standing up for itself for the first time since the concert’s promoter The highly publicized meltdown Late last year during ticket sales for Taylor Swift’s “Eras” tour.
Joe Berchtold, president and chief financial officer of Live Nation, which owns Ticketmaster, made the case before the Senate Judiciary Committee on Tuesday that the live concert industry is more competitive than it was a decade ago, when Live Nation merged with Ticketmaster, and that the ticket seller It does not control capacity or prices.
“The major ticket companies, including Ticketmaster, don’t set ticket prices, don’t decide how many tickets to sell, and when they go on sale, don’t set service fees,” he said in an editorial.
Berchtold’s assessment was in strict agreement with Sen. Amy Klobuchar, who said in her opening statement that Ticketmaster fits “the definition of a monopoly.”
“The Live Nation is so powerful that it doesn’t even need to put pressure on it, it doesn’t need to threaten, because people are going along with it,” said the Minnesota Democrat.
Three roles in one
Antitrust scholars and consumer advocates point to Ticketmaster’s role as a ticket seller, owner or operator of event venues, as well as an event promoter. The company bears both the costs of the event and its advertising. Scientists have testified that Live Nation’s arrival allows it to put pressure on performers and lock them into subsidiary deals.
“The major venues in the US know that if they move their core ticketing business from Ticketmaster to a competitor, they risk losing the significant revenue they earn from Live Nation concerts. And they know this because Live Nation has told them so, directly and indirectly – through its statements. public, its private communications and subsequent retaliation against venues that challenged Ticketmaster,” SeatGeek CEO Jack Grotzinger stated.
Berchtold emphasized that Live Nation only owns a small portion of the 4,000 event venues in the United States—about 5%, he said. However, critics note that the event giant’s portfolio includes the largest and most profitable venues, while the Ticketmaster division has exclusive ticket contracts with the vast majority of sports venues.
Last year, 87% of Billboard’s Top 40 shows were recorded by Ticketmaster, and the company secured exclusive ticket contracts with 87% of NBA and NHL arenas and 97% of NFL stadiums, testified Jerry Mickelson, head of independent events producer Jam Productions.
“This merger is vertical integration on steroids. Using dominance in one market to reduce competition in another,” he said. Mickelson said the Jam, which has produced nearly 1,500 live events in the 40 years since its founding, has only produced one since 2015.
“Ariana’s concerts were Leejam’s most profitable business,” he said. But since the merger, Live Nation has pushed independent promoters out of the segment.
The musicians made $6 of the $42 concert tickets
Indie music group Lawrence, whose latest song “False Alarms” contains the line “Live Nation is a monopoly,” illustrated the power of Live Nation with an example.
“Live Nation functions as three things at the same time: the promoter, the venue, the ticket company,” band member Clyde Lawrence told the panel. Because Live Nation owns the venue, provides show money and sells tickets, Lawrence said, it has tremendous power when negotiating with artists.
“If they want to take 10% of the proceeds and call it a facility fee, they can, and they did. If they wanted to charge $30,000 for [facility rent], they can get it. “If they want to charge $250 for a stack of clean towels, they can have it,” Lawrence said.
He illustrated the discrepancy with an example of a show that Lawrence set ticket prices at $30. After Ticketmaster added on the 40% fee, fans paid $42 per ticket. After paying for the facility, the band made $12 per ticket – about half of which went toward touring costs.
“That leaves us with $6 for an eight-piece band, before tax, and we also have to pay our own health insurance,” Lawrence said.
He added, “We really don’t see Live Nation as an enemy. They’re just the biggest player in a game that feels stacked against us as artists, and often our fans, too.”
Taylor Swift breakdown
The widely anticipated hearing was called shortly after Ticketmaster canceled its November sale Taylor Swift concert tour When the service ran into technical glitches and what it called “historic” customer demand for seats. Swift had planned her “Eras” tour for 52 concerts in 18 venues, with Ticketmaster the primary ticket for all but five of these shows. During a pre-sale event on November 15, Ticketmaster has crashed After 14 million fans and bots tried to buy tickets. Thousands of fans who thought they were being allowed to buy tickets were unable to purchase them, prompting some to do so Ticketmaster sued.
Interested parties began lining up for the hearing before 9 am, more than an hour before it began. By the time the doors opened, the line had crept down the hallway.
Sal Nuzzo, a witness from the James Madison Free Market think tank, commented that his daughters had told him the hearing would be the “most important” thing he would do in his career, adding that he drove into a crowd of protesters in the road. Hearing.
The episode led to calls for Ticketmaster to split up, with critics charging that the ticketing platform, promoter, and venue owner monopolized the event market. Attendees from the Institute for American Economic Freedoms, an antitrust group, handed out pamphlets in the hearing room calling for the company to be broken up.
It is estimated that Ticketmaster has a market share of over 70% of the US ticketing industry, and is the primary ticker for more than 80% of professional sports teams and NBA, NHL, and NFL venues. Live Nation disputes these claims, saying its market share has shrunk since the 2010 merger.
“Ticketmaster has lost, not gained, market share, and each year competitive bidding results in ticket companies getting less economic value in holding tickets while venues and teams getting more,” said Berchtold. “US ticket markets have never been more competitive than they are today, and we read about potential newcomers all the time.”
The Senate also heard from ticketing platform SeatGeek and live event producer Jam Productions, as well as scholars who study antitrust.
Speculators wrong?
Live Nation put a lot of the blame on bots and scalpers who grabbed tickets in order to resell them at higher prices. At least some artists agree with this assessment. In a letter supporting Live Nation, country music star Garth Brooks asked the commission to make the speculation illegal.
“Crushing bots while selling is a huge cause of program failure regardless of the ticketing company. The person who always pays for this atrocity is the customer, and the last person that should have this burden,” Brooks wrote in a letter submitted to the commission.
Live Nation claims to have invested millions in developing anti-bot technology on the platform.
the The Ministry of Justice is investigating Live Nation on whether a company’s market power violates antitrust law and harms competition, and The Tennessee Attorney General’s office is investigating The Swift incident, as well as what some fans claim is sub-par customer support during the clamor.
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