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The US Department of Justice has accused Ticketmaster’s parent company Live Nation Entertainment of operating a monopoly that “suffocates its competition” in the live entertainment industry, in a landmark antitrust lawsuit that seeks to break up the company.
The civil complaint was filed Thursday by the Justice Department, joined by a bipartisan group of state and district attorneys. The lawsuit alleges that Live Nation Entertainment illegally dominates the concert ticketing and promotion market by using “exclusionary conduct” to exert undue influence over the majority of live concert venues in the US.
The Justice Department described how the company allegedly gained a stranglehold over the live entertainment ecosystem, from how artists are paid for shows that take place in the US.
As a result, “fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters are squeezed out and venues have fewer real options to sell tickets,” U.S. Attorney General Merrick Garland said Thursday. “It’s time to split Live Nation-Ticketmaster.”
The company was formed in 2010 through the merger of Live Nation, a concert promoter, and Ticketmaster, a live event ticketing platform. Since then, discontent has grown among fans, rivals, artists and US lawmakers, who have accused it of abusing its dominant market power by charging exorbitant fees and retaliating against venues that choose to work with competitors.
This frustration was exacerbated by the fiasco during ticket sales for Taylor Swift’s 2022 Eras Tour, when Ticketmaster was overwhelmed by massive demand.
In a press conference littered with musical references, Garland said the lawsuit was filed on behalf of fans, artists, independent promoters, venues and the public. “The American people are ready for this,” he said, nodding to Swift’s lyrics Reputation album.
The complaint outlines what the company describes as its “flywheel” business model, where revenue from sponsorships and fan concert fees is used to “lock” artists into exclusive promotions. The Justice Department added that the group also acquired rivals in an effort to destroy competition.
Jonathan Kanter, head of the Justice Department’s antitrust unit, described Thursday what he called “the dreaded tax for Ticketmaster: a seemingly endless array of fees ironically named ‘service fees’ or ‘convenience fees’ when they are anything but.” As a result of the company’s “illegal monopoly,” he said, “the live music industry in America is broken.”
Dan Wall, executive vice president of corporate and regulatory affairs at Live Nation Entertainment, disputed the Justice Department’s allegations, saying it was “absurd to suggest that Live Nation and Ticketmaster have monopoly power.”
He said the lawsuit “ignores everything that is actually responsible for higher ticket prices, from rising production costs to the popularity of artists to continuous online ticket scalping that reveals the public’s willingness to pay far more than primary tickets are worth.” Wall added that “each year, competition in the industry leads Live Nation to lower income from concert promotions and ticket sales.”
According to the DoJ, Live Nation directly manages more than 400 music artists and owns or operates more than 60 of the top 100 amphitheaters in the US. Through Ticketmaster, the group controls about 80 percent of the primary tickets to prime concert venues, prosecutors said.
The Department of Justice has greenlit the merger of Ticketmaster and Live Nation under a 10-year settlement agreement with provisions including a ban on retaliation against venues that choose alternative ticketing or promotional services. That agreement was modified and extended in 2019 after the Justice Department accused her of “repeated” violations of the original agreement.
Wall said the group was “another casualty of this administration’s decision to turn antitrust enforcement into a populist compulsion that simply rejects how antitrust law works.”
It is the latest major antitrust case brought by the Justice Department’s antitrust unit, which has taken a tougher enforcement stance under Kanter. He is among a new generation of progressive officials appointed by President Joe Biden who say anti-competitive behavior has snowballed across the U.S. economy due to decades of lax enforcement. His department launched proceedings against US corporate titans including Google and Apple.
Fred Rosen, the former chief executive of Ticketmaster before its sale to Live Nation, said he believes fighting the company does little to address the problem it’s trying to combat: expensive tickets.
“Even if they split Live Nation, Ticketmaster’s policies will not change. The company would sustain itself at all levels,” he said.
More news from James Fontanello-Khan