As expected, the United States Department of Justice sued Live Nation and Ticketmaster for violations of the Sherman antitrust act on Thursday, a move that could change the shape of the multibillion-company that is the world’s largest live entertainment organization. Live Nation fully owns Ticketmaster, North America’s biggest ticket vendor.
The complaint claims that the company has a monopoly on ticketing through Ticketmaster,and that it illegally uses monopoly power to dominate the ticketing business and quash competition.
“It is time to break it up,” said attorney general Merrick B. Garland in a press conference on Thursday morning.
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An official statement from the attorney general continued: “We allege that Live Nation relies on unlawful, anticompetitive conduct to exercise its monopolistic control over the live events industry in the United States at the cost of fans, artists, smaller promoters, and venue operators. The result is that fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters get squeezed out, and venues have fewer real choices for ticketing services.”
In the press conference, he clarified the reasoning behind the action: “In recent years, Live Nation and Ticketmaster’s exorbitant fees and technological failures have been criticized by fans and artists alike,” he said, referring most obviously to the uproar around the disastrous Taylor Swift “Eras” tour on-sale, which enraged fans and resulted in governmental criticism and scrutiny. “We are not here today because Live Nation and Ticketmaster’s [customers] are frustrated. We are here because as we allege that conduct is anticompetitive.”
The 124-page complaint, filed Thursday in the U.S. District Court for the Southern District of New York, alleges that Live Nation-Ticketmaster unlawfully exercises its monopoly power in violation of Section 2 of the Sherman Act. “As a result of its conduct, music fans in the United States are deprived of ticketing innovation and forced to use outdated technology while paying more for tickets than fans in other countries,” a summary issued by the DOJ stated. “At the same time, Live Nation-Ticketmaster exercises its power over performers, venues, and independent promoters in ways that harm competition. Live Nation-Ticketmaster also imposes barriers to competition that limit the entry and expansion of its rivals.”
The complaint details that Live Nation-Ticketmaster has unlawfully maintained monopolies in several concert promotions and primary ticketing markets and engaged in other exclusionary conduct affecting live concert venues, including arenas and amphitheaters. The complaint further alleges that Live Nation-Ticketmaster’s exclusionary practices fortify and protect what it refers to as its “flywheel.” The flywheel is Live Nation-Ticketmaster’s “self-reinforcing business model that captures fees and revenue from concert fans and sponsorship, uses that revenue to lock up artists to exclusive promotion deals, and then uses its powerful cache of live content to sign venues into long term exclusive ticketing deals, thereby starting the cycle all over again,” the statement continues. “Live Nation-Ticketmaster’s anticompetitive conduct creates even more barriers for rivals to compete on the merits.”
Despite a Ticketmaster spokesperson’s recent claim that the company faces “more competition today than it has ever had, and the deal terms with venues show it has nothing close to monopoly power,” it holds more than 80% of the market for primary ticket sales in the largest venues in the U.S., as well as exclusive ticketing contracts with many stadiums and arenas.
Specifically, the complaint details that Live Nation-Ticketmaster engaged in a variety of tactics to eliminate competition and monopolize markets:
Relationship with Oak View Group: Live Nation-Ticketmaster exploits its longtime relationship with Oak View Group, a potential competitor-turned-partner that has described itself as a “hammer” and “protect[or]” for Live Nation. In recent years, Oak View Group has avoided bidding against Live Nation for artist talent and influenced venues to sign exclusive agreements with Ticketmaster. For example, Live Nation has scolded Oak View Group multiple times for trying to compete. In one instance, Live Nation asked, “who would be so stupid to . . . play into [an artist agent’s] arms,” and on another occasion, Live Nation stated, “let’s make sure we don’t let [the artist agency] now start playing us off.”
Retaliating Against Potential Entrants: Live Nation-Ticketmaster successfully threatened financial retaliation against a firm unless it stopped one of its subsidiaries from competing to gain a foothold in the U.S. concert promotions market.
Threatening and Retaliating Against Venues that Work with Rivals: Live Nation-Ticketmaster’s power in concert promotions means that every live concert venue knows choosing another promoter or ticketer comes with a risk of drawing an adverse reaction from Live Nation-Ticketmaster that would result in losing concerts, revenue, and fans.
Locking Out Competition with Exclusionary Contracts: Live Nation-Ticketmaster locks concert venues into long-term exclusive contracts so that venues cannot consider or choose rival ticketers or switch to better or more cost-effective ticketing technology. These contracts allow Live Nation-Ticketmaster to reduce competitive pressure to improve its own ticketing technology and customer service.
Blocking Venues from Using Multiple Ticketers: Live Nation-Ticketmaster’s conduct and exclusive contracts prevent new and different promotions and ticketing competitors and business models from emerging. They block venues from being able to use multiple ticketers, who would compete by offering the best mix of prices, fees, quality, and innovation to fans.
Restricting Artists’ Access to Venues: Live Nation-Ticketmaster has increasingly gained control of key venues, including amphitheaters, through acquisitions, partnerships, and agreements. Live Nation-Ticketmaster restricts artists’ use of those venues unless those artists also agree to use their promotion services.
Acquiring Competitors and Competitive Threats: Live Nation-Ticketmaster strategically acquired a number of smaller and regional promoters that it had internally identified as threats. This has undermined competition and impacted artist compensation.
In a response issued 10 minutes before Thursday’s press conference began, Live Nation said: “The DOJ’s lawsuit won’t solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows.Calling Ticketmaster a monopoly may be a PR win for the DOJ in the short term, but it will lose in court because it ignores the basic economics of live entertainment, such as the fact that the bulk of service fees go to venues, and that competition has steadily eroded Ticketmaster’s market share and profit margin.Our growth comes from helping artists tour globally, creating lasting memories for millions of fans, and supporting local economies across the country by sustaining quality jobs.We will defend against these baseless allegations, use this opportunity to shed light on the industry, and continue to push for reforms that truly protect consumers and artists.”
The company has been under investigation by the DOJ for two years, and has been the subject of such claims since Live Nation and Ticketmaster merged in 2010, a move that was challenged but ultimately was allowed by the federal government to move forward. Many have complained that the company’s aggressive business behavior and vertically integrated structure —it has not only concert-promotion and ticketing divisions but also artist management; it also owns venues and their concessions, among other assets — is by nature anticompetitive.
The case is focused on Ticketmaster’s use ofexclusive contractswith venues, which garners venues an advance in proportion to the length of the contract. The DOJ’s case states that these deals block other companies from competing; Ticketmaster has long claimed that it is open to non-exclusive contracts, but in practice, other companies have found taking on the ticketing giant to be rough going.
Exorbitant ticket fees and several chaotic concert-tour on-sales — most notably those of Taylor Swift and Bruce Springsteen in 2022 —along with problems in customer service have led many, includingmultiple congresspeople, regulators and state attorneys general, to call for the company to be broken up. The New York Times reported that the DOJ had launched an investigation into the company even before the public and government outcry following Ticketmaster’s widely reported problems during the 2022 on-sale for Taylor Swift’s “Eras” tour.
Regardless, Live Nation has posted record earnings in nearly every quarter since the pandemic lifted. In 2023, its revenue was up 36% to nearly $23 billion.
In a blog post on the Live Nation website in March, Dan Wall, the company’s head of corporate affairs, argued that the company is not a monopoly, stating that Ticketmaster does not set prices — artists and their teams do —and the majority of ticketing fees go to venues.While those facts are to varying degrees true, many critics have argued that Live Nation’s claims to be powerless to fix the situation —not to mention its involvement in the secondary ticketing market —are disingenuous at best.
