all too well<\/em>.\u201d It was not the only citation of Swift lyrics during the proceedings. <\/p>\n\n\t\u201cThat\u2019s the Ticket: Promoting Competition and Protecting Consumers in Live Entertainment\u201d approached the subject from a number of perspectives. In certain respects this was a tale of two hearings. Some of the witnesses as well as some of the senators, seemed particularly focused on rolling back the merger between Ticketmaster and Live Nation, which in 2020 was reaffirmed and the consent decree extended to 2025. Others pointed to Ticketmaster itself and its dominant presence in the ticketing market.<\/p>\n
\n\tJudiciary chair Dick Dubin (D-IL) spoke first and provided some of the backdrop: \u201cLive Nation merged with Ticketmaster in 2010 in a deal that joined the country\u2019s largest ticketing company with its largest event promoter.\u00a0 The Justice Department and Attorneys General from many states, including Illinois, sued to block the merger. The plaintiffs ultimately allowed the merger to go through, but put in place a consent decree with a set of conditions and divestitures designed to ensure competition in ticketing and live entertainment markets. Unfortunately, that consent decree does not appear to have been effective in the decade plus since the merger Live Nation has consolidated its dominant position in the ticketing and live entertainment markets. And the result is a competition killing strategy that has left artist and fans paying the price.\u201d<\/p>\n
\n\tIn his opening statement, Jerry Mickelson, the Chicago-based concert promoter who founded JAM Productions in 1972, referenced his testimony before the very same committee nearly 14 years earlier, regarding the then-proposed merger. He commented, \u201cIn 2009, I appeared in front of the committee to testify about the proposed merger of Live Nation and Ticketmaster. At that hearing, I stated the unification of these two Goliaths would create a business with extraordinary market power and clout, unlike any that I\u2019ve ever seen in my lifetime. I testified that if this merger was allowed to proceed, the combined entity would\u2019ve the ability to suppress or eliminate competition in many segments of the industry. Today, we know with certainty that this merger is vertical integration on steroids, using dominance in one market to expand its power and dominance in another, cutting out the competition and harming the consumers.\u201d<\/p>\n
\n\tMickelson also mentioned, \u201cWhen Live Nation loses money on a concert, they can make up for that with operating income from ticketing and sponsorships. We can\u2019t do that. We don\u2019t have those. Pepsi doesn\u2019t earn money from Coke, but our competitor Live Nation earns money from selling tickets to our concerts.<\/p>\n
\n\tThen he looked back and offered his overall take on what has ensued: \u201cFrom my vantage point, the arena level concerts used to be JAM\u2019s most profitable segment of the business because that\u2019s where we earned our money. In 1996, JAM produced a hundred concerts in arenas, but in 2011, 1 year after the merger that decreased to 46 concerts, and in 2022 we only produced 14 arena concerts. Live Nation went after the arena business and they succeeded in driving us and other independent promoters out of that sector.\u201d<\/p>\n
\n\tKathleen Bradish, Vice President for Legal Advocacy, American Antitrust Institute (a Washington D.C.-based nonprofit that aims to promote competition for the benefit of \u201cconsumers, businesses, and society\u201d) spoke of the need for structural relief that would break up both Live Nation and Ticketmaster.<\/p>\n
\n\t\u201cLive Nation-Ticketmaster is a leading example of both a traditional monopoly and a modern dominant digital player,\u201d she contended. \u201cIts dominance in markets in the live entertainment supply chain creates strong incentives to exclude smaller rivals such as smaller or independent concert promoters and venues. Ticketmaster\u2019s dominance in digital ticketing also creates incentives to limit competition from ticket resellers and brokers, thus impairing the functioning of the important secondary ticketing market. Customers pay the price with higher ticket prices and ticket fees, lower quality, less choice and less innovation.\u201d<\/p>\n
\n\tBerchtold\u2019s testimony encompassed three themes. He emphasized the increasingly competitive nature of the industry, Ticketmaster\u2019s role as a technological and marketing innovator, as well as the ongoing threat posed by \u201cthe industrial scalping of tickets, using bots to unfairly gain possession of those tickets illegally.\u201d<\/p>\n
\n\t\u201cIn 2009, the Department of Justice alleged that Ticketmaster\u2019s market share was over 80%. It is a different story today,\u201d he testified. \u201cThe most obvious change is the emergence of the enormous secondary ticketing market, in which Ticketmaster has a modest market share and many strong competitors. But also in primary ticketing, the Ticketmaster of 2010 did not face the level of competition we face today from new competitors including SeatGeek, AEG\u2019s AXS, and Eventbrite, along with established competitors including Tickets.com and Paciolan.\u201d<\/p>\n
\n\tThe Live Nation executive also underscored that Ticketmaster does not establish the face value of tickets, which is set by the artists\u2019 contract with the promoter. Beyond that he added, \u201cIn most cases venues set service and ticketing fees, and the majority of those fees go to the venue, not to Ticketmaster. Indeed, for as long as Live Nation has owned Ticketmaster, the portion of the service fee that Ticketmaster retains has been falling and the venue\u2019s share has been increasing.\u201d<\/p>\n
\n\tBerchtold directly apologized to Taylor Swift and her fans. He also explained, \u201cThere was unprecedented demand for Taylor Swift tickets. We knew bots would attack that onsale, and planned accordingly. We were then hit with three times the amount of bot traffic than we had ever experienced, and for the first time in 400 Verified Fan onsales they came after our Verified Fan access code servers. While the bots failed to penetrate our systems or acquire any tickets, the attack required us to slow down and even pause our sales.\u201d<\/p>\n
\n\tEven so, he noted, \u201cSince the merger, we have invested over $1 billion in capital to improve the Ticketmaster system. \u2026 I can say with great confidence that technologically Ticketmaster is a much better ticketing system today than it was in 2010. Its performance in large onsales is the best in the industry, it has the best marketing capabilities of any ticketing system, and it is far and away the leader in preventing fraud and getting tickets into the hands of real fan.\u201d<\/p>\n
\n\tLate in the hearing Berchtold referenced a letter of support submitted by Garth Brooks, who is \u201cwell known for being one of the leading advocates of providing a great show and a great value for his fans.\u201d Berchtold pointed out that Brooks \u201ccalled out very specifically that it\u2019s the scalping that takes place. That <\/em>is the origin of the problems that we have, and everything else is a derivative issue.\u201d<\/p>\n\n\tThe roster of witnesses also included Jack Groetzinger the CEO of SeatGeek, which competes with Ticketmaster on both the primary and secondary market. SeatGeek recently lost a seven-year contract with Brooklyn\u2019s Barclays Center to Ticketmaster after just a year.<\/p>\n
\n\tIn 2019 the Justice Department had accused Live Nation back of using its market power to pressure potential Ticketmaster clients into signing deals by suggesting that if they did failed to do so, they would lose access to Live Nation performances.<\/p>\n
\n\tSeatGeek had not commented on the Barclays situation prior to the hearing but in response to a question from Senator Durbin, Groetzinger initially referenced a New York Times report that indicated \u201conce we took over ticketing for the Barclays Center in Brooklyn, the Barclays Center saw a marked decrease in the number of concerts from Live Nation that were sent to that venue versus historical averages.\u201d<\/p>\n
\n\tThen Groetzinger offered additional insight, as he revealed, \u201cLast year, Barclays Center management came to us and said, \u2018We\u2019d like to keep using you for ticketing our basketball, but we want to be able to use Ticketmaster to ticket concerts.\u2019 And we looked into it and couldn\u2019t get the economics to work. So we said to them, \u2018Listen, let\u2019s just part ways amicably,\u2019 and we did.\u201d<\/p>\n
\n\tBerchtold responded that as per the initial article, the decrease in shows could be attributed to another venue that had opened in the marketplace. As a result, \u201cSo you now had two venues, vying for the shows that weren\u2019t going to Madison Square Garden, and that the number of shows going to Barclays from all the major promoters went down as a result of that increased competition.\u201d<\/p>\n
\n\tHe later added, \u201cit is absolutely our policy to not pressure threaten or retaliate against venues by using content as part of the ticketing discussion.\u201d<\/p>\n
\n\tThe Live Nation executive acknowledged that the Justice Department \u201calleged six issues in 2019, which led to our decision with them to extend the consent decree.\u201d<\/p>\n
\n\tThen he suggested that there had been \u201cdiffering interpretations\u201d of the original consent decree. As a result, \u201cOne of the things that we\u2019ve done is in instances where venues are seeking to tie in a ticketing and a concert agreement into an overall deal, we have eliminated those. So that there can\u2019t be any instance where there\u2019s the perception of threats or retaliation associated with that bundling done at the venues request. So we\u2019ve simply eliminated that from our service set, along with the establishment of monitors to make sure that any venue, employee, or others could confidentially report any issues.\u201d<\/p>\n
\n\tClyde Lawrence, singer-songwriter for the band Lawrence, shared his perspective as an emerging artist. In December he had penned a guest essay for the New York Times <\/em>titled, \u201cTaylor Swift\u2019s Live Nation Debacle Is Just the Beginning.\u201d His remarks in the chamber echoed that essay, as he expressed his frustration with both the economics and opacity of the system whereby after settling with a venue at the end of the night, his band would typically receive only $12 from a $30 ticket. He also observed that on top the $30, his fans were paying service fees that ranged from 40% of the face value to a peak of 82% and that he had no input or awareness of this, routinely discovering the fees only after logging onto the Ticketmaster site as a customer and searching for the group\u2019s shows.<\/p>\n\n\tOne of the recurring topics at the hearing was the length of Ticketmaster\u2019s exclusive contracts with the venues, which Bradish suggested had an anti-competitive effect on the market.<\/p>\n
\n\tKlobuchar echoed this in asking Berchtold: \u201cOne way that Live Nation eliminates competitive pressures is by locking venues into multi-year contracts, whether they three years, five years, seven years. If you\u2019ve tied up 80% of major concert venues with multi-year contracts, where is there room for one of your competitors to get in the door?\u201d<\/p>\n
\n\tHe responded with his contention that the 80% reference was generated by a 2008 Department of Justice study. He countered that the number at present was lower, closer to the 50-60% range.<\/p>\n
\n\tMickelson cited a different number, which did not focus on all potential venues clients but instead emphasized high-volume business. He suggested that 87% of the top 40 U.S. concert tours in 2022 were ticketed by Ticketmaster. The he added that 87% of the NBA teams and 93% of the NFL teams also had exclusive agreements with the company.<\/p>\n
\n\tGroetzinger added that Ticketmaster has been moving from five year contracts which had been the industry standard to 10 year contracts, in anticipation of potential regulatory action to follow.<\/p>\n
\n\tTicketing practices in the United Kingdom. also became an important reference point.<\/p>\n
\n\tThe SeatGeek CEO noted, \u201cThe venues that host English Premier League teams \u2014 which include major franchises such as Liverpool, Manchester United and Chelsea \u2014 do not rely on concerts for revenue. Thus, they do not rely on Live Nation. As a result, venues choose a ticketing platform based on the merits of the technology. In contrast to its eighty percent plus market share of major sports venues in the United States, Ticketmaster tickets only twenty percent of the teams in the English Premier League.\u201d<\/p>\n
\n\tMickelson later pointed out the U.K. ticketing market offers a potential model to consider. There the venues do not enter into exclusive ticketing contracts. Instead, facilities typically share inventory within multiple ticketing agents.<\/p>\n
\n\tAs for what might emerge from the hearing, Klobuchar emphasized \u201cour desire to actually move on this issue.\u201d She affirmed that a range of possibilities exist: \u201cSome of them are smaller things that can be done right away. Some of them are things that the Justice Department may order.\u201d<\/p>\n
\n\tAbove all else, \u201cWe are very interested in actually doing something and not just throwing popcorn.\u201d<\/p>\n
\n
\nRead More About:<\/h4>\n<\/nav>\n<\/div><\/div>\n Read More<\/a>Senator Richard Blumenthal (D-CT) summed up the tenor and tone of today\u2019s Senate Judiciary Committee hearing on the lack of competition in the ticketing industry while directly addressing witness Joe Berchtold, president and CFO of Live Nation Entertainment, which owns Ticketmaster. Blumenthal asserted, \u201cMr. Berchtold, I want to congratulate and thank you for an absolutely<\/p>\n","protected":false},"author":1,"featured_media":600792,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23305,1798,485],"tags":[18708,5758],"class_list":{"0":"post-600791","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-armed","8":"category-entertainment","9":"category-taylor","10":"tag-armed","11":"tag-taylor"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/600791","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=600791"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/600791\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/600792"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=600791"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=600791"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=600791"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}