Over an hour into Tuesday’s Senate judiciary listening to on competitors within the music trade, Sen. Richard Blumenthal sardonically “congratulated and thanked” Reside Nation Leisure president and CFO Joe Berchtold for the “completely gorgeous achievement” of unifying Republicans and Democrats over a coverage matter. The glue for such cooperation? The vitriol and concern all of them have over the ticketing trade and with Reside Nation Leisure, the dad or mum firm of the eponymous live performance promoter and of ticketing big Ticketmaster.

It was Reside Nation in opposition to nearly everybody else in the course of the listening to, with senators scrutinizing each facet of the live performance big’s enterprise from ticketing charges and exclusivity agreements with Ticketmaster to its market share on live performance promotion and possession of venues with Reside Nation. Different trade and antitrust skilled witnesses collaborating within the listening to, in the meantime, outright criticized the ability the corporate has over the remainder of the trade, labeling Reside Nation a monopoly that have to be damaged up. 

Reside Nation’s Berchtold gave a a lot completely different perspective, claiming that the live performance and ticketing industries are extra aggressive than ever. He asserted that the bigger issues to enhance the trade lie inside higher enforcement to cease scalpers and bots from shopping for mass quantities of tickets and from passing laws for extra transparency for customers. 

“As I hear and skim what it’s important to say, it’s mainly, ‘It’s not us, it’s everybody however us.’ And the very fact of the matter is that Reside Nation/Ticketmaster is the 800-pound gorilla right here,” Blumenthal informed Berchold in the course of the listening to. “You’ve gotten clear dominance, monopolistic management. This entire live performance ticket system is a large number. Might I recommend respectfully that Ticketmaster should look within the mirror and say, ‘I’m the issue, It’s me.’” (Blumenthal’s reference was considered one of maybe too many Swift-inspired lyrical callbacks and puns from senators at this time.)

The controversial lack of competitors within the reside music enterprise has been an intense subject of debate for over a decade, when Reside Nation, the trade’s largest live performance promoter, merged with Ticketmaster, the enterprise’s largest ticketer in 2009. Previous to the Division of Justice’s approval of the merger, critics  warned the deal would create a vertically built-in behemoth that may stifle competitors within the reside occasions house. The deal was authorized on the situation that Reside Nation entered right into a consent decree to stop the corporate from leveraging its energy within the promotion house to power venues to make use of Ticketmaster. By the start of 2020, that decree was amended after the DOJ alleged Reside Nation had violated the decree quite a few occasions. 

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Blumenthal, like a number of different senators, advised that if the DOJ’s reported ongoing investigation into Reside Nation finds the corporate has violated that consent decree, U.S. regulators ought to take into account breaking apart Reside Nation and Ticketmaster. 

As Sen. Amy Klobuchar — who known as the listening to alongside Mike Lee — informed American Antitrust Institute witness Kathleen Bradish in the course of the listening to after noting Reside Nation’s outsized market share within the trade: “I wish to dispel the notion that this isn’t a monopoly, after which we will go from there about options.”

A few of the fellow witnesses beside Reside Nation, which included rival ticket and promotion providers, antitrust consultants and a touring artist, have been extra direct, stating that their companies endure within the present system and that Reside Nation is a monopoly that have to be reigned in. 

“A scarcity of sturdy competitors in our trade meaningfully stunts innovation, and customers are that suffer,” Jack Groetzinger, CEO of Ticketmaster rival SeatGeek, informed the senators in the course of the listening to. “Venues concern shedding Reside Nation concert events in the event that they don’t use Ticketmaster. The one solution to restore competitors on this trade is to interrupt up Ticketmaster and Reside Nation.”

Groetzinger — whose firm just lately misplaced a partnership with Brooklyn’s Barclays Middle —  stated that the world informed SeatGeek it needed to make use of Ticketmaster for concert events however nonetheless preserve his firm for basketball video games as a result of a drop within the variety of Reside Nation concert events at Barclays since SeatGeek took over. Such a deal wouldn’t work economically, so the 2 amicably parted methods, Groetzinger stated. Berchtold, nonetheless, emphasised that there was no retaliation from his firm towards Barclays and informed the panel that the overall variety of concert events as an entire dropped as a result of a excessive stage of competitors for area reveals in New York’s market.

Jerry Mickelson, cofounder of Chicago-based promoter Jam Productions, beforehand testified earlier than the Senate’s antitrust subcommittee in 2009 concerning the Reside Nation Ticketmaster merger to warn of anti-competitive implications, as he famous throughout his opening assertion on Tuesday. Since then, he alleged, these considerations got here to fruition. 

“At the moment we all know with certainty that this merger is vertical integration on steroids, utilizing dominance in a single market to develop its energy and dominance in one other, slicing out the competitors and harming the customers,” Mickelson stated, noting that within the late Nineteen Nineties, his firm produced 100 area concert events. By 2011, one 12 months after the merger, it dropped to 46 and by final 12 months, all the way down to 14, suggesting Reside Nation’s dominance is the trigger. 

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When requested about venues’ considerations about breaking from Reside Nation, Mickelson echoed Groetzinger’s sentiments. “When talking with folks that both personal or handle venues, their largest concern is that if they go away Ticketmaster, they’ll lose content material. Whether or not it’s stated or not, it’s implied that if I don’t use Ticketmaster, I’m not going to get all of the reveals that I wish to have.”

Berchtold disputed the claims and countered that the reside music enterprise is extra aggressive than it’s ever been. He pointed to scalpers and widespread use of bots as the largest shopper risk within the trade and the principle reason for the disastrous on-sale interval for Taylor Swift’s upcoming Eras tour — which itself drew sufficient criticism towards the corporate to encourage the listening to within the first place. 

“We hear individuals say that ticketing markets are much less aggressive at this time than they have been on the time of the Reside Nation-Ticketmaster merger. That’s merely not true,” Berchtold stated, later claiming that their market share has dropped for the reason that merger and that the corporate has invested $1 billion into enhancing Ticketmaster’s system for the reason that merger. 

Berchtold stated that the venues, not the corporate, set the price charges and that Reside Nation’s personal venues have price charges according to the remainder of the trade. He advocated for higher enforcement of the BOTS Act, handed in 2016 and designed to cease scalpers from utilizing bots to purchase mass quantities of tickets. He additionally vied for options concerning transparency within the trade resembling government-mandated all-in ticket pricing to require all ticket firms to indicate charges upfront relatively than conceal them on the finish of a purchase order. 

“We apologize to the followers. Ticketmaster accepts its accountability as being the primary line of protection in opposition to bots in our trade,” Berchtold stated. “We additionally want to acknowledge how industrial scalpers utilizing bots and cyber assaults to unfairly acquire tickets has contributed to this terrible expertise.” 

A number of senators acknowledged issues with implementing the BOTS Act, but additionally pushed again on Reside Nation’s evaluation of the issue, questioning why Ticketmaster because the market chief hasn’t been capable of get a greater deal with on the bot challenge. 

Tennessee Senator Marsha Blackburn requested Berchtold why different industries have been capable of get a greater deal with on bots whereas Ticketmaster hasn’t. “Banking providers, bank card processors, well being care firms, they get bot assaults each single day by the hundreds they usually have figured it out however you guys haven’t,” Blackburn stated. “That is unbelievable. You ought to have the ability to get some good recommendation from some individuals and determine this out … Do we have to make sure you’ve got higher individuals round your IT group?”

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As for options, the panel debated whether or not or not a wider unfold utilization of non-transferrable tickets to curb scalping would clear up any issues, how lawmakers ought to method ticketing charges, and whether or not there ought to be caps on charges. 

Clyde Lawrence of the band Lawrence — the lone artist on the witness panel — stated he wasn’t positive if Reside Nation is a monopoly when requested towards the tip of Tuesday’s listening to. Nonetheless, he famous that when he asks a venue about ticket charges, he’s usually informed it’s a Reside Nation challenge, refuting Berchtold’s declare. He additional claimed there must be modifications to programs like settlement on fee for the band and on what the artist takes versus the promoters and ticketers. 

“Why is it that each one of Reside Nation’s prices get recouped earlier than the present hits its revenue level but ours, the artists’, don’t? Why is there so little transparency as to what line gadgets resembling facility charges truly go in direction of,” Lawrence requested throughout his opening assertion. “Why is it customary for Reside Nation to take a 20% fee on our merchandise gross sales whereas we by no means obtain a cent of their ancillary revenues like concessions, alcohol and parking? Lastly, why is Reside Nation allowed to freely set exorbitantly excessive ticket charges with none transparency or enter whereas in different industries, the federal government has mandated caps on numerous kinds of junk charges?”

Following the listening to, nonetheless, it’s clear that each the senators and trade officers alike questioned how efficient the consent decree is in any respect, and whether or not it’s potential for Ticketmaster and Reside Nation to exist as one firm and nonetheless preserve the trade aggressive. 

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When requested about Berchtold and Reside Nation’s solutions to enhance the trade, Bradish, vp for authorized advocacy on the American Antitrust Institute, informed these within the listening to that no stage of modifications will clear up the antitrust considerations so long as Reside Nation stands to learn.

“None of these solutions go to the core of what we’ve been speaking about at this time, which is the antitrust downside,” Bradish stated. “[It’s] the truth that Reside Nation-Ticketmaster has the motivation to do issues to exclude competitors in all of its markets up and down the provision chain for reside leisure. I admire these solutions. A lot of them could also be good concepts, however it doesn’t change the truth that Reside Nation-Ticketmaster is a monopoly and can act as a result of that’s its incentive, to exclude competitors.”



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