WASHINGTON — For decades now, Ticketmaster has engendered bad blood from concertgoers angry over its fees but has managed to shake it off, growing into the largest ticketing company in America. But after crossing Taylor Swift fans, parent company Live Nation faced a Senate panel Tuesday intent on getting the company to admit, “It’s me, hi, I’m the problem, it’s me.”
Live Nation drew the ire of thousands of Taylor Swift fans in the fall, after its website crashed when tickets for Swift’s upcoming “Eras” tour went on sale. Swifties also decried huge swings in the tickets’ prices and painfully long wait times. A similar debacle afflicted ticket sales for a Bad Bunny concert in Mexico City. As Swift apologized to fans, Congress swore to hold hearings, and on Tuesday the Senate Judiciary Committee held the first.
Ticketmaster merged with Live Nation, a concert venue and promotions company, in 2010, creating a live events behemoth that controls nearly every aspect of putting on a show short of the singing and dancing. On Tuesday, senators criticized how that vertical integration created a market-dominating powerhouse with little concern for average fans.
“In an ode to Taylor Swift, I will say, ‘We know all too well,’” said Sen. Amy Klobuchar, D-Minn., who chairs the Subcommittee on Competition Policy, Antitrust and Consumer Rights. “Live Nation doesn’t just dominate the ticketing — about 70% of the big concert market — but also they own many of the major venues, and for the venues that they don’t own, they tend to lock in on three-, five-, seven-year agreements, which means that the competitors that are out there aren’t able to even compete when it comes to the ticketing.”
Subcommittee ranking member Mike Lee, R-Utah, also couldn’t resist the siren’s call of a Swift allusion, prefacing his remarks by thanking Klobuchar for pushing for the hearing. “I had hoped, as of a few months ago, to get the chair back,” he said. “But once again, ‘she’s cheer captain and I’m on the bleachers.’”
The business of hosting, promoting, and selling tickets to concerts and other live events — Ticketmaster dominates pro sports ticketing, as well — is an odd one. According to the Los Angeles Times, Ticketmaster controls nearly 80% of the ticket market in the U.S., bringing in $750 million in annual profits. It seems like just a middleman between the musician and the concertgoer. But Ticketmaster’s real customers aren’t fans — who have little choice in how to buy their tickets — but the venues (often owned by Live Nation) and the musicians. And as some of those customers, including Garth Brooks and the Atlanta Braves, attested in written testimony, Ticketmaster has treated them extremely well.
“What I witnessed (working with Ticketmaster) was a true concern and care for ticket buyers,” wrote Brooks.
As some of Swift’s exes can attest, a tongue lashing may sting in the moment but leaves few lasting scars. Live Nation and Ticketmaster have a long history of essentially selling themselves as the bad guy to the public, allowing bands and arenas to scapegoat the company for their own greedy pricing decisions. Tuesday was more of the same, albeit under the glare of a congressional spotlight.
“Primary ticketing companies, including Ticketmaster, do not set ticket prices. We do not decide how many tickets go on sale and when. And we do not set service fees. Pricing and distribution strategies are determined by artists and their teams. Service fees, even if called ticketing fees, are retained mainly by venues,” said Live Nation President Joe Berchtold.
Berchtold does face a more tangible risk than just the verbal berating he received, however, if the senators decide to do more than take advantage of the extra media attention to get themselves on TV and instead turn to legislating.
After nearly 50 years of Congress and the courts endorsing a laissez-faire approach to the antitrust regime, one ostensibly couched in terms of maximizing consumer welfare by permitting efficiency-driving mergers, members of both parties now are questioning the concentration of corporate power that has resulted. Biden’s picks to run the Federal Trade Commission and Department of Justice’s Antitrust Division — Lina Kahn and Jonathan Kanter, respectively — have been far more aggressive in challenging mergers and enforcing consent decrees than their predecessors from both Republican and Democratic administrations.
As part of the 2010 merger, Live Nation entered a consent decree with the DOJ to refrain from retaliating against musicians who didn’t use its venues and pay $1 million for each violation. The DOJ and Live Nation extended that decree in 2020. The DOJ also reportedly opened a separate investigation into Live Nation in November, following the Swift ticket fiasco.
In recent years, bipartisan legislation aimed at creating a more hawkish competition policy has been brewing in both chambers, with Klobuchar working closely with Lee and Sen. Charles E. Grassley, R-Iowa. Congress passed a bill last year increasing the fees that large companies proposing mergers must pay, but more aggressive measures did not reach the president’s desk. Similar bills passed the House last year but ran out of time in the Senate, despite Grassley’s insistence that they had enough Republican votes to defeat a filibuster.
The hopes of passing stronger antitrust laws dimmed after the midterm elections. While some Republicans, including deeply conservative House Freedom Caucus members like Ken Buck of Colorado, support tougher measures, most of the party remains skeptical, including House Judiciary Chairman Jim Jordan of Ohio and Speaker Kevin McCarthy of California.
Live Nation’s competitors seized their chance to pile on Tuesday, calling for its breakup. “As long as Live Nation remains both the dominant concert promoter and ticketer of major venues in the U.S., the industry will continue to lack competition and struggle,” said Jack Groetzinger, CEO of SeatGeek, a ticketing company.
“Pepsi doesn’t earn money from Coke, but our competitor, Live Nation, makes money from selling tickets to our concerts,” said Jerry Mickelson, CEO of Jam Productions, which runs concert venues in Chicago. Mickelson described how Live Nation used its market dominance to push his company out of the arena concert business using allegedly monopolistic tactics.
Antitrust policy fans hoping the hearing might draw Swift’s star power had to settle for Clyde Lawrence, singer for the band Lawrence, which included the lyric “Live Nation is a monopoly” on one of its latest releases.
Lawrence countered some of Live Nation’s claims of being just an agent of the artists, alleging the company dictates fees and terms for smaller acts like them — in effect, creating a two-tier system for musicians in which smaller bands can’t negotiate the way bigger acts can.
Bands set the ticket price while the venues set the fees, Berchtold said in response. That didn’t sit well with Judiciary Chair Richard J. Durbin.
“You control the venue, do you not?” he asked.
Ticketmaster’s practices have long irked fans and bands alike. Pearl Jam launched a campaign against Ticketmaster in the ’90s, testifying before a House panel against the company’s price-stoking strategies.
Not every senator on Tuesday’s panel joined in the Ticketmaster bashing. Louisiana Republican John Kennedy rolled his eyes at the witnesses attacking the company’s practices. “If you care about the consumer, cap the price, cut out the bots, cut out the middle people,” said Kennedy. “And if you really care about the consumer, give the consumer a break. Not every kid can afford, whatever it is, $500 to see Taylor Swift.”
———
