WASHINGTON (AP) — The Ministry of Justice sued Ticketmaster and its parent company Thursday, accusing them of operating an illegal monopoly on live events in the United States and asking a court to break up the system that stifles competition and drives up prices for fans.
Filed in Manhattan federal court, the vast antitrust lawsuit was introduced with 30 state and district attorneys general and seeks to dismantle the monopoly that they say crowds out small promoters, harms artists and drowns ticket buyers in fees. Ticketmaster and its owner, Live Nation Entertainment, have a long history of clashing with major artists and their fans, including Taylor Swift and Bruce Springsteen.
“It’s time for fans and artists to stop paying the price of Live Nation’s monopoly. » Attorney General Merrick Garland said. “It’s time to restore competition and innovation to the entertainment industry. It’s time to disband Live Nation-Ticketmaster.
The government has accused Live Nation of tactics — including threats and retaliation — that Garland said allowed the entertainment giant to “stifle competition” by controlling virtually every aspect of the industry, from concert promotion at the ticket office. The impact results in a “endless list of fees imposed on fans,” the attorney general said.
“Live music should not be available only to those who can afford to pay the Ticketmaster tax,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s antitrust division.
Ricky Palitti and Jacob DeLong of Detroit said they recently spent about $1,200 on three tickets to a Shania Twain concert using Ticketmaster and about $370 to see RuPaul’s Drag Race Live.
“I think the price of tickets has definitely increased, but I also think all the different fees that Ticketmaster puts on an order are definitely increasing the price, for sure,” Palitti said.
DeLong said that while he respects an artist’s work, the added fees make the costs of seeing a show “ridiculous.”
“Where can we take a break?” he said.
Live Nation, which for years denied violating antitrust laws, said the lawsuit “won’t resolve the issues fans are concerned about with ticket prices, service fees and access to in-demand shows.” .
“Calling Ticketmaster a monopoly may be a public relations victory for the DOJ in the short term, but it will lose in court because it ignores the fundamental economics of live entertainment,” Live Nation added. He said most service fees go to venues and that outside competition has “consistently eroded” Ticketmaster’s market share. The company said it would defend itself against the “baseless allegations.”
The Justice Department said Live Nation’s anticompetitive practices include using long-term contracts to prevent sites from choosing competitors, prohibiting sites from using multiple ticket sellers, and threatening sites that could lose money if they don’t choose Ticketmaster.
In 2021, the concert giant threatened financial retaliation against a company if one of its portfolio companies did not stop competing with Live Nation for artist endorsement contracts, the Justice Department alleged. Live Nation also recruited smaller promoters it viewed as a threat, officials said.
Michael Carrier, a professor at Rutgers Law School who specializes in antitrust litigation, said the Justice Department has a strong case. He expects Live Nation to “try to shift the blame elsewhere,” such as by claiming prices are set by artists or venues, but he said those explanations are weak.
“The DOJ has shown how Live Nation really has its tentacles in every element of the supply chain, meaning it has a lot more control than it lets on,” he said . “And, in terms of justifications, there’s really very little that (Live Nation) can offer in terms of helping the consumer.”
The complaint says a breakup between Live Nation and Ticketmaster is on the table. This, combined with other solutions such as banning certain exclusive deals that hinder competition, could potentially help fans see lower ticket prices, give artists more freedom in choosing venues and boost the success of small developers in the long term, Carrier said.
Ticketmaster, which merged with Live Nation in 2010, is the world’s largest ticket seller for live music, sports, theater and more. During its annual report last month, the company said Ticketmaster had distributed more than 620 million tickets through its systems in 2023.
About 70% of tickets for major concert venues in the United States are sold through Ticketmaster, according to data from a 2022 federal consumer lawsuit. The company owns or controls more than 265 North American concert venues. North and dozens of prominent amphitheaters, according to the Ministry of Justice.
Live Nation’s footprint has grown significantly over the past 10 years, according to the company’s annual financial reports. Between the end of 2014 and the end of 2023, Live Nation reported a global increase of more than 136% in terms of venues for which the company “owned, leased, operated, had exclusive booking rights or had an interest in which we had a right reservation”. significant influence.”
The ticket seller sparked outrage in November 2022 when her site crashed during a pre-sale event for a Taylor Swift stadium tour. The company said the site was overwhelmed by both fans and bot attacks, which posed as consumers to grab tickets and sell them on secondary sites. The debacle prompted hearings in Congress and bills in state legislatures aimed at better protecting consumers.
The Justice Department allowed Live Nation and Ticketmaster to merge on the condition that Live Nation agree not to retaliate against music venues for using other ticketing companies for 10 years. In 2019, the ministry investigated and found that Live Nation had repeatedly violated this agreement. The government then extended the ban on retaliation against concert halls until 2025.
“This is a failure of past antitrust. And it’s something that defrauds customers every day,” said John Kwoka, an economics professor at Northeastern University and also a consultant to the states who led a parallel Justice Department investigation into the merger in 2009. initial from Live Nation and Ticketmaster.
Kwoka, who has been among those who have long advocated a breakup, notes that Live Nation and Ticketmaster have remained “largely uncontrolled” for the past 15 years.
Ticketmaster’s clashes with artists and fans date back three decades. Pearl Jam targeted the company in 1994, years before the Live Nation merger, although the Justice Department ultimately declined to file charges. More recently, Bruce Springsteen fans were furious about the high cost of tickets due to the platform’s dynamic pricing system.
Live Nation argued that artists and crews set prices and decide how tickets are sold. The company’s executive vice president of corporate and regulatory affairs, Dan Wall, said in a statement On Thursday, factors such as increased production costs, artist popularity and online ticket scalping were “actually responsible for the rise in ticket prices.”
The Justice Department’s lawsuit filed Thursday is the latest example of the Biden administration’s aggressive enforcement of antitrust laws. The effort targeted companies accused of engaging in illegal monopolies that eliminate competitors and drive up prices. In March, the Department of Justice filed a complaint against Apple alleging that the tech giant has monopoly power in the smartphone market. The Democratic administration has also taken on Google, Amazon and other tech giants.
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Grantham-Philips reported from New York. Associated Press journalists Michelle Chapman and Maria Sherman in New York, Christopher L. Keller in Albuquerque, New Mexico, and video journalist Ty O’Neil in Las Vegas contributed.
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News Source : apnews.com
