It was only a matter of time before a politician awkwardly quoted Taylor Swift at Tuesday morning’s Senate Judiciary Committee hearing on Ticketmaster, Live Nation and the US ticketing market.
“May I respectfully suggest that Ticketmaster look in the mirror and say, ‘I’m the problem. It’s me,’” Sen. Richard Blumenthal (D-Conn.) told Live Nation Entertainment President and CFO Joe Berchtold, referencing the chorus from Swift’s No. 1 song “Anti-Hero.” “The reason is, quite simply, that you are ultimately responsible for skyrocketing prices, exorbitant hidden fees, sold-out shows, and bots and scalpers.”
In November, Ticketmaster failed to sell out Swift’s upcoming stadium tour, prompting an outcry from demoralized fans who ran out of tickets and, soon after, criticism from a variety of politicians and a class action lawsuit from disgruntled Swifties. . Tuesday’s hearing, led by Sens. Amy Klobuchar (D-Minn.) and Mike Lee (R-Utah), showed bipartisan skepticism toward the Live Nation/Ticketmaster conglomerate, which dominates the live music market.
Critics say Live Nation, which merged with Ticketmaster in 2010, exercises undue power over the concert industry. Live Nation is the largest concert promoter in the country, while Ticketmaster controls approximately 80% of the ticketing market. The companies were allowed to merge under a Justice Department consent decree that required Ticketmaster to license its software and prohibited retaliation against competitors.
Tuesday’s hearing, which featured testimony from ticketing executives, independent promoters, antitrust experts and entertainers, looked at the company’s alleged anti-competitive practices, high service fees and failure to remove automated touts from the process. ticket purchase. The aggressive line of questioning from the Democratic and Republican senators made it clear that there is a real regulatory and legislative threat to Live Nation and Ticketmaster’s business model, and perhaps to their future as a single company.
“Innovation in live event ticketing has been stunted because Live Nation Entertainment Inc. controls the world’s most popular artists, ticketing systems and even many of the venues,” said Jack Groetzinger, co-founder and CEO of SeatGeek. a direct competitor to Ticketmaster. “This power over the entire live entertainment industry allows Live Nation to maintain its monopoly influence over the mainstream ticketing market. As Live Nation remains the dominant concert promoter and ticket seller to major venues in the United States, our industry will continue to wrestle with the challenges it faces today.”
Clyde Lawrence, lead singer of the New York soul-pop band Lawrence, said that “since we started touring, we noticed what seemed like lopsided deal mechanisms in certain aspects of the live music industry.”
Live Nation’s “horizontal and vertical reach makes it difficult to create competition,” he continued. “Companies in the ticketing space could bring important innovations that enable lower fares, greater transparency…and advances in handling the troubled secondary ticketing market…But no matter how innovative these other companies are ticketing; if all Live Nation shows have to air exclusively through Ticketmaster, there’s no chance they’ll break through.”
Kathleen Bradish of the American Antitrust Institute went even further.
“Live Nation/Ticketmaster is a monopoly,” he said, “and it will act because it has a strong incentive to shut out the competition.”
“Ticketmaster gets a lot of flak,” Berchtold acknowledged in his opening remarks. “But I can say with great confidence that, technologically, Ticketmaster is a much better ticketing system today than it was in 2010. Its large sales performance is the best in the industry, it has the best marketing capabilities of any system. ticketing agency and is by far the leader in preventing fraud and getting tickets into the hands of real fans.”
During three hours of testimony and cross-examination, nearly every senator in attendance had at least some angle to criticize the firm.
“In 2018, thousands of people in Hawaii tried and failed to get Bruno Mars tickets,” said Sen. Mazie Hirono (D-Hawaii). “I heard Mr. Berchtold say that after the merger, they spent a billion dollars to improve the Ticketmaster system. So, I wonder what kind of improvements to the Ticketmaster system are actually being followed.
“I am against fools, and the way the company handled the sale of Ms. Swift was a debacle,” John Kennedy (R-La.) said. “Whoever was in charge of that should be fired.”
Marsha Blackburn (R-Tenn.) expressed concern that the company was not doing enough to combat bots or automated scalping. She “she has blamed bot attacks for causing the accident during Taylor Swift’s ticket sales. Ticket sellers seem to see bot attacks as normal in their operations,” Blackburn said. “This is an unacceptable situation.”
Several speakers mentioned the recent switch at Brooklyn’s Barclays Center, which switched back to Ticketmaster after ending a deal with SeatGeek one year into a seven-year deal. Some on the panel suspected that Live Nation had retaliated for Barclays’ deal with SeatGeek by moving their concerts to competing venues.
“The Barclays Center saw a marked decrease in the number of Live Nation concerts being sent to that venue compared to historical averages,” Groetzinger said. “Management approached us and said we wanted to be able to use Ticketmaster to buy concert tickets, and we looked into it and couldn’t get the economy to work.”
“The Department of Justice noted a pervasive environment of fear of retaliation,” Bradish agreed. “And as a result, it shows that when a company has an incentive to act in a particular way, a consent decree will not necessarily prevent them from doing so.”
The Justice Department has an ongoing investigation into Live Nation’s practices.
“To people who are fed up, I would say to continue criticizing if you are angry and frustrated,” Blumenthal said. “You have the power to demand action, and we must act with new legislation. If the Department of Justice established a violation of the consent decree, a reversal of the merger should be on the table.
“If the Department of Justice establishes facts involving monopoly and predatory abuse, there should be structural remedies,” he continued. “How to divide the company”.