Amy Edwards demonstrates against the live entertainment ticketing industry outside the US Capitol on January 24, 2023 in Washington, DC.
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The Senate Judiciary Committee slammed concert giant Live Nation on Tuesday, urging activists and artists to speak to the competition in the ticketing industry after a botched sale of Taylor Swift tickets in November.
Led by Sen. Amy Klobuchar, D-Minn., who leads antitrust investigations for the committee, the senators questioned Live Nation’s chief financial officer, Joe Berchtold, about the company’s dominance in the ticketing business. Industry witnesses described a monopoly-like control over venues, performers and consumers.
“Ticketmaster should look in the mirror and say, ‘I’m the problem, it’s me,'” said Sen. Richard Blumenthal, D-Conn., playfully Fast lyrics.
Blumenthal said Republicans and Democrats alike agree that something needs to be done. But they seemed to diverge on the way forward, with several Democrats appearing open to passing new legislation to address the issues while Mike Lee, R-Utah, a senior member of the antitrust subcommittee, criticized what he saw as lax enforcement accused of existing laws.
Live Nation owns Ticketmaster, the world’s largest ticket seller, representing approximately 70% of all tickets sold in the US. It also owns concert halls and sponsors tours, leading many opponents to describe its business as a monopoly in the industry.
Live Nation, which merged with Ticketmaster in 2010, has long been criticized for its size and power in the entertainment industry. Opponents heightened their grievances in November when advance ticket sales for Swift’s Eras Tour were plagued by disruptions and long lines.
Live Nation was scheduled to open sales to 1.5 million verified fans ahead of general public ticket sales. However, more than 14 million users flocked to the presale site, including bots, causing massive delays and site suspensions. Ultimately, 2 million tickets were sold in advance and general public sales were cancelled, company officials said.
“To me, the inability of the leading ticketing company to deal with bots is an incredible statement,” Jerry Mickelson, chief executive officer of Jam Productions, said during Tuesday’s hearing. “You can’t blame bots for what happened to Taylor Swift. There’s more to this story that you’re not hearing.”
Swift, who has been working to bring all marketing in-house, publicly criticized the company at the time for mishandling the sales process, but did not name it.
The Justice Department has opened an antitrust investigation into Live Nation’s practices, but that investigation stems from the Swift ticket sales fiasco.
Joe Berchtold, President and Chief Financial Officer of Live Nation Entertainment, and Jack Groetzinger, Chief Executive Officer of SeatGeek, listen as Jerry Mickelson, Chief Executive Officer and President of Jam Productions, during a Senate Judiciary Committee hearing entitled ” That’s the ticket: promoting competition and protecting consumers in live entertainment. on Capitol Hill in Washington, U.S., January 24, 2023.
Kevin Lamarque | Portal
Berchtold testified Tuesday that the company owns about 5% of venues in the U.S. and said Ticketmaster has lost, not gained, market share since merging with Live Nation.
Clyde Lawrence, a singer-songwriter for the band Lawrence, stressed Live Nation’s control over various aspects of the business, saying that at the end of the day the company “is negotiating to pay itself.”
Lawrence told lawmakers that if his band plays at a Live Nation venue, they must use the company as a promoter and sell tickets through Ticketmaster. That often comes with higher upfront costs and lower backend splits than a third-party provider, he said.
Lawrence also spoke of a lack of transparency on additional ticket fees, which he says average between 40% and 50% of the base ticket price. Berchtold said Tuesday that venues set the fee percentage, but agreed his company could be more forthcoming with that information.
Berchtold also emphasized what he said is the growing problem of ticket scalping.
Tuesday’s hearing expands a bipartisan focus on antitrust actions by senators in recent years.
Late last year, lawmakers managed to pass legislation that would increase merger filing fees for large deals and increase funds for federal enforcers who review those deals. Klobuchar, who sponsored the bill, cited the legislation to help these agencies challenge potentially anti-competitive deals in her comments Tuesday.
Still, Congress has so far failed to pass some of the more ambitious legislation that would set new guard rails for competitive practices, particularly in the technology space. Despite bipartisan support, the impasse shows how difficult it can be to update or amend existing antitrust laws, which many lawmakers believe are not adequately enforced by the courts as they stand.
The merger of Live Nation and Ticketmaster was approved by the Justice Department under the Obama administration, with certain terms to which the newly merged company agreed under what is known as a consent decree. Live Nation had to meet certain requirements, e.g. B. No retaliation against concert venues used by another ticketing company for a period of time.
In 2020, Live Nation and the DOJ agreed to update the consent decree and extend it through 2025, as the DOJ said the company took actions it believed violated its previous agreement.
The current antitrust enforcement regime under the Biden administration has made it clear that it favors structural remedies or disconnects over behavioral measures such as consent decrees.