Last month, the Department of Justice and 30 states, including California, Oklahoma, Ohio, and the District of Columbia, filed suit against Live Nation Entertainment and its subsidiary, Ticketmaster, for its anticompetitive conduct in the live entertainment industry. As Public Knowledge has been critical of Ticketmaster’s harmful conduct in the past, we strongly support this lawsuit.
Beyonce’s “Renaissance” tour was an incredible experience (co-author Elise even went viral during the first night of the D.C. show). But Beyonce partnered with Ticketmaster to sell the tickets, so it inevitably drained Elise’s pockets. Now, she did her due diligence – she had signed up with her friends for early access and waited with bated breath to get the lowest prices. Nonetheless, they were passed over for early access, bamboozled by long wait times, and as a result, had to weather the sky-high prices of the competitive resale market. Now that Beyonce has released Act II: Cowboy Carter, we both question if her wallet can survive another Ticketmaster blow – and we’re not alone. Many a Swiftie and Bruce Springsteen fan have expressed their dismay at the process by which Ticketmaster disseminates tickets for highly coveted shows. This lawsuit has managed to bridge the partisan divide under one position: Live Nation Entertainment’s dominance over consumers, artists, and venues has caused far too much anticompetitive harm, and must be stopped.
The Complaint
Ticketing
According to the DOJ, Live Nation Entertainment monopolizes the ticketing services market and hinders rival ticketing companies from competing in the market. The conglomerate signs long-term exclusive contracts with venues, leverages its secondary ticketing platform to box out other ticketers, and purchases rival concert promoters and venues to whittle down competition. A specific example of anticompetitive conduct is Live Nation’s 2019 deployment of SafeTix, a security feature touted as a consumer protection tool that requires all ticket transfers to occur within the Ticketmaster platform. Instead of helping consumers, the complaint alleges that SafeTix makes it harder for fans to resell their tickets on any other platform, and binds tickets to the mobile application.
Promotion
The complaint also outlines several ways in which Live Nation undercuts rival promoters’ profits and threatens both venues and artists into compliance. Live Nation holds about 60% of the concert promotion market associated with primary ticketing sales. The DOJ alleges that Live Nation purchased key concert venues and concert promotion companies with the purpose of coercing artists to exclusively use Live Nation venues and services. Artists that wish to perform on a bigger stage must comply with Live Nation’s restrictions or forego accommodating their audiences at larger venues. For example, Live Nation mandates artists to exclusively use Live Nation promotional services to book a show at one of Live Nation’s venues, stripping artists of the freedom to shop around for a third-party promotion package.
Requested Relief
The DOJ has requested the court condemn Live Nation Entertainment’s anticompetitive conduct by breaking up their monopoly. Specifically, the DOJ calls for the divestiture of Ticketmaster from Live Nation. The complaint also requests the court prevent Live Nation from repeating any similar conduct in the future.
The Path to Procompetitive Reform
The complaint outlines much of the harmful conduct that Public Knowledge has pointed to previously – in particular, Live Nation’s leveraging power and restrictions on ticket resale. As a consolidated entity, Live Nation and Ticketmaster pose a greater cost to consumers, artists, and venues. The costs result in more fees for music lovers and restricted bargaining power for venues and artists.
In terms of relief, structural separation is critical. The DOJ gave Live Nation explicit conditions to not abuse its market power to squeeze artists and venues, yet Live Nation did so anyway. The consequences, therefore, should be straightforward: Live Nation and Ticketmaster must break up. Structural separation can facilitate a more competitive market, thereby mitigating the harm of Live Nation’s conduct and giving artists, consumers, and venues more choices.
But we need to think beyond remedies that the court can provide. Despite this strong complaint, Live Nation and Ticketmaster are still off the hook for holdbacks, and the Federal Trade Commission’s ban on junk fees could use reinforcement from Congress. A potential solution here is the BOSS and SWIFT Act, which aims to uncover hidden fees, deter scalpers, highlight refund policies, and hold ticketing companies like Live Nation Entertainment accountable for their astronomical prices.
It’s simple – Congress needs to pass antitrust reform so that consumers, artists, and venues have freedom of choice in who they deal with, at market-appropriate prices.