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The Live Nation Case

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We need a threat on the federal case against Live Nation, i.e, Ticketmaster, and its horrible practices that need to end.

The Department of Justice filed a lawsuit on Thursday to break up Live Nation’s monopoly over the live entertainment industry, which it has abused through a range of alleged anti-competitive practices. This long-awaited lawsuit seeks to rectify a 2010 mega-merger between concert promoter, venue owner, and artist management company Live Nation and the ticketing service provider Ticketmaster. Barack Obama’s Justice Department, under the direction of Antitrust Division chief Christine Varney, cleared the deal, only imposing a weak consent decree that the combined behemoth has since repeatedly violated, and a divestiture of some of the ticketing business to a third party that gained scant market share.

As a result, Live Nation/Ticketmaster now holds a vise grip over broad swaths of the industry, dictating high ticket prices to consumers, shaking down venues for as much of their revenues as possible, and setting both tour schedules and pay for artists.

Live Nation controls more than 80 percent of major concert venues’ primary ticketing for concerts and an increasing share of ticket resales in the secondary market. The company has exclusive arrangements with 265 concert venues, including deals with more than 60 of the top 100 amphitheaters in the United States. It also has a controlling interest in 338 venues worldwide. Over 400 big-name artists are locked into Live Nation’s management services. No other competitor comes close to having that scale across any of these market segments.

As the current head of the Antitrust Division, Jonathan Kanter, put it at a press conference on Thursday, “Collectively, these practices forge an impenetrable corporate barrier around the live music industry. That’s why today we seek to hold them accountable.”

In response to the lawsuit, Live Nation hit back with a blistering statement denying the charges that it holds monopoly power and attacking the DOJ’s perceived agenda. “At bottom, we are another casualty of this Administration’s decision to turn over antitrust enforcement to a populist urge that simply rejects how antitrust law works. Some call this “Anti-Monopoly”, but in reality it is just anti-business.”

Kanter coined the term “Ticketmaster tax” at the announcement, referring to the long list of fees that consumers find at checkout for concert tickets, among them “service or convenience fees,” “payment processing fees,” and “facility fees.”

Higher prices are certainly one prominent expression of Live Nation’s monopoly. But as the complaint lays out, the consumer experience with Ticketmaster as a sole provider for concert tickets is just one forward-facing expression of the company’s monopoly power. The others affect not only consumers but venue operators, promoters, artists, and virtually everyone else associated with the live entertainment business.

On the back end, Live Nation has used its control of ticketing to expand into all other facets of live entertainment, and to bundle services like concert promotion, advertising, artist management, on-site venue merchandise sales, concessions, and even venue parking. Because it has one highly lucrative source of revenue in ticketing, it has been able to cross-subsidize its growth into other lines of business to gain a foothold over competitors.

This is the kind of monopoly that just pisses everyone off–there are probably worse monopolies in the world but this is one that really grates if you buy concert tickets, and as any reader of this site knows, I buy a lot of concert tickets. Obviously, I just don’t take the stated ticket price even remotely seriously when I see it first listed, but really, it’s totally outrageous.

The country music podcaster Tyler Mahan Coe has long made the case that the big artists are responsible for a lot of this too, as it allows them to advertise a cheaper ticket than they want to charge and then they clean up on the back end thanks to Live Nation. I don’t have the ability to evaluate that claim, but it is at least plausible and he knows a lot more about the business end of the industry than I do.

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