The US Department of Justice and 30 state attorneys general sued Live Nation Entertainment, which owns Ticketmaster, for what they say are unfair business tactics.
When Live Nation and Ticketmaster joined in 2010, they made a powerful entertainment company that handles most of the country’s ticket sales and venue bookings. But Taylor Swift fans’ experience buying tickets for the Eras tour in late 2022 was so bad that lawmakers looked more closely at how much power the entertainment giant had over the business. The presale was full of bugs and people had to wait hours to get tickets, and the public sale had to be canceled because of too much traffic.
At a news conference on Thursday, U.S. Attorney General Merrick Garland said, “Live Nation suffocates its competition using a variety of tactics, from buying up smaller regional promoters and venues to threats and agreements with rivals that Live Nation will not honor.”
People aren’t just upset about Swiftie; the pop star’s fame has made the problems people have with Live Nation and Ticketmaster stand out more. Fans of everything from punk bands to show hosts hate Ticketmaster because of bad experiences with the company. When Dimension 20, the Dungeons & Dragons play show, put on sale tickets for its show at Madison Square Garden in April, Ticketmaster’s dynamic pricing system made the prices so sky-high that most fans couldn’t afford them. Dropout, the company that puts on Dimension 20, later said that they were not told about dynamic pricing before the tickets went on sale. This feature raises ticket prices automatically based on demand.
It would be easier for other tickets startups to get started in a field where Ticketmaster is already strong. If the two companies broke up, it would let them do that. Business in this area are now trying to change the current system by either building a new one, like on the blockchain, or by focused only on the secondary market.
In response to the claims made in the Department of Justice’s case, Live Nation executive vice president Dan Wall put out a statement.
The case and the press conference that announced it try to show Live Nation and Ticketmaster as the reason why fans are upset with the live entertainment business, the statement says. “High ticket prices are blamed on concert promoters and ticketing companies, but neither of these groups has any control over ticket prices.” It doesn’t take into account the real reasons for higher ticket prices, like rising production costs, the fame of the artist, and the fact that people can buy and sell tickets online 24 hours a day, 7 days a week.
Wall then compares Ticketmaster’s 5% take rate to that of Twitch (50%), StubHub (37%), Uber (25%), and other companies. There is one site that is very similar to StubHub, but the others are not quite the same. Ticketmaster also charges service fees that are more than 5% of the ticket price. It’s still hard for new companies to break into the live music market because most American venues work with Live Nation.
Garland says that people in the US are more angry about Live Nation’s supposed market dominance than people in other countries.
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Garland said, “In other countries, where venues are not limited to Ticketmaster’s exclusive ticketing contracts, venues often use more than one ticketing company for the same event. As a result, fans see lower prices and more innovative ticketing products.”
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