NYT EXAMINES LIVE NATION'S DOMINANCE
Eight years after Live Nation joined forces with Ticketmaster, the ticketing business remains dominated by the Michael Rapino-led company and its operations now extend into nearly every aspect of the concert world, a New York Times piece—titled Live Nation Rules Music Ticketing, Some Say With Threats—points out.
Writers Ben Sisario and Graham Boley remind readers that in 2010, at the time of the merger, many feared a monopoly, but federal officials attempted to reassure naysayers, suggesting that the space was still fertile enough for competitors to grow and thrive.
When they flashforward to present day, however, they note “Ticket prices are at all-time highs. Service fees are far from reduced. And Ticketmaster, now part of the Live Nation empire, still tickets 80 of the top 100 arenas in the country. No other company has more than a handful. No competitor has risen to challenge its pre-eminence."
"Now," according to the NYT story posted Sunday, "Department of Justice officials are looking into serious accusations about Live Nation’s behavior in the marketplace."
"They have been reviewing complaints that Live Nation, which manages 500 artists, including U2 and Miley Cyrus, has used its control over concert tours to pressure venues into contracting with its subsidiary, Ticketmaster. The company’s chief competitor, AEG, has told the officials that venues it manages that serve Atlanta, Salt Lake City, Oakland, Minneapolis, Louisville and Las Vegas, were told they would lose valuable shows if Ticketmaster was not used as a vendor, a possible violation of antitrust law.”
Is there truth to these complaints or are they just the result of a heated rivalry? The reader is left wondering. For example, NYT shines a light on the Atlanta situation.
In that case, "the complaint stems from a 2013 tour by the band Matchbox Twenty. Live Nation bypassed the Gwinnett Center, a popular arena outside the city, for another venue in town. Gwinnett’s booking director, Dan Markham, worried his venue was being punished, according to emails he wrote at the time,” the piece goes on. “The center had just replaced Ticketmaster with a service controlled by AEG. ‘Don’t abandon Gwinnett,’ he wrote to a Live Nation talent coordinator. ‘If there’s an issue or issues let’s address.’ ‘Issue?’ the Live Nation coordinator wrote back. ‘Three letters. Can you guess what they are?’
According to NYT, “Live Nation says that, no matter what its employee wrote, the decision to bypass the center was not punitive. The other venue was managed by Live Nation and simply fit more people. But the following year, Live Nation cut the number of tours it brought to Gwinnett in half, from 4 to 2. Live Nation described the drop as a routine fluctuation. But Mr. Markham later said in an email that he had expected the drop-off because Live Nation ‘warned us that they would put us in a literal boycott.’”
“Live Nation officials say they never threaten or retaliate. They dismissed the complaints as tactical, deliberate mischaracterizations by AEG. ‘You have a disgruntled competitor that is trying to explain their loss around the boogeyman that there were threats made that nobody can document,’ Daniel M. Wall, Live Nation’s antitrust lawyer, told the Times.
“The bloodletting between Live Nation and AEG has grown fierce in recent years and rippled through the industry. Last month, another of Mr. Wall’s clients, the heavy-metal icon Ozzy Osbourne, sued AEG on antitrust grounds, saying that it tried to bar him from playing its O2 arena in London, unless he played its Staples Center in Los Angeles. AEG said its policy was a response to Live Nation’s steering concerts to its Los Angeles rival, the Forum."
Ticketmaster President Jared Smith responded to the article with a 1,200-word blog post that touched on the company’s background and current set-up, and contradicted AEG’s point of view.
AEG has “been telling anyone who will listen that the reason they often lose to Ticketmaster is not because we have worked hard to create better products and add new services, but because we threaten venues with a loss of Live Nation content (concerts) if they don’t pick Ticketmaster as their ticketing partner.
“It is absolutely against Live Nation and Ticketmaster policy to threaten venues that they won’t get any Live Nation shows if they don’t use Ticketmaster. We also do not re-route content as retaliation for a lost ticketing deal. … Misusing our relationship with artists to “settle scores” with venues would be both bad business and counter to our core beliefs.”
Smith says the current ticketing marketplace is highly competitive, listing SeatGeek, AXS and Eventbrite, and noting “new entrants are on the horizon, including resale ticketing companies and e-commerce giants.”
He concludes, “I would much rather talk about the things we are doing to ensure that consumers get fair access to tickets. … But I guess none of that sells newspapers. So, we will continue to uphold the principles of the Consent Decree as we always have without shying away from talking about the things that we believe make us the best overall partner in the market. That’s the way competition should work.”
