US Justice Department sues to dissolve living nation, Ticketmaster's parent company, for alleged antitrust violations.
The lawsuit, joined by 30 states and filed Thursday, follows a Justice Department investigation into whether Live Nation maintains a monopoly in the ticketing industry, an investigation launched in 2022 and bolstered by complaints from fans. fans following a botched ticket release for Taylor Swift's Eras tour.
“We allege that Live Nation relies on unlawful and anticompetitive conduct to exert its monopoly control over the live events industry in the United States at the expense of fans, artists, small promoters and venue operators,” said Attorney General Merrick Garland in a statement. . “The result is that fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters are excluded, and venues have fewer real options for ticketing services. It's time to separate Live Nation- Ticketmaster”.
Live Nation shares fell 5% Thursday morning.
In a statement, Live Nation said the Justice Department's accusations of a monopoly are “absurd.”
“The DOJ complaint attempts to portray Live Nation and Ticketmaster as the cause of fans' frustration with the live entertainment industry. It blames concert promoters and ticketing companies—none of which control prices. of tickets—for high ticket prices. It ignores everything that is really responsible for higher ticket prices, from rising production costs to the popularity of artists, to online ticket sales. 24/7, which reveals the public's willingness to pay far more than primary tickets cost,” said Dan Wall, executive vice president of corporate and regulatory affairs at Live Nation.
Live Nation and Ticketmaster merged in 2010, creating a dominant entity in the live events industry. The company operates and manages ticket sales for live entertainment worldwide and also owns and operates more than 265 entertainment venues in North America, including more than 60 of the top 100 amphitheaters, according to the Justice Department's lawsuit.
Through Ticketmaster, Live Nation controls approximately 80% or more of the top concert tickets for major concert venues, according to the complaint.
The Justice Department's lawsuit, filed in the U.S. District Court for the Southern District of New York, accuses Live Nation of maintaining a business model that reinforces itself by collecting fees and revenue from fans. from concerts and sponsorships, which he then uses to lock artists into exclusives. endorsement deals that give artists access to key entertainment venues across the country. Live Nation then uses that dominance to lock new concert venues into long-term exclusion contracts, thus restarting the cycle, the lawsuit claims.
Live Nation is also accused of threatening financial retaliation against potential competitors and venues that work with rivals; strategically acquire regional and smaller competitive threats; and exploiting a relationship with venue partner Oak View Group, transferring the latter's contracts to Ticketmaster and discouraging competition in concert promotions.
Live Nation made headlines last year when a surge in demand from 14 million users, including bots, for tickets to Taylor Swift concerts caused site outages and slow queues. A Senate subcommittee issued a subpoena to Live Nation and Ticketmaster in November 2023, following a months-long investigation fueled by exorbitant and inflated ticket prices on Swift's Eras tour.
The high prices of shows in the United States led dozens of fans to look for tickets for Swift's tour in other countries, which could often be cheaper even after traveling by international plane.
“Music fans in the United States are deprived of innovation in ticket sales and are forced to use outdated technology while paying more for tickets than fans in other countries,” the Justice Department said in a statement. Press release.
Live Nation said Thursday that it does not profit from monopoly pricing and stated that Ticketmaster's service charges “are no higher than elsewhere and are often lower.” The company noted that its overall net profit margin is on the lower end of S&P 500 companies.
Live Nation argued that the lawsuit will not reduce ticket prices or service fees. He said teams of artists set their ticket prices and venues set and keep most of the ticket fees.
“Some call this 'antitrust,' but really it's just anti-business,” Live Nation's Wall said. “There is no legal basis to oppose vertical integration on these grounds.”
Live Nation earlier this month reported its “biggest first quarter ever,” citing that first-quarter revenue was up 21% from the prior-year period.
The company was also in the public eye last year over transparency issues related to hidden fees in ticket prices.
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