Justice Department sues to break up Live Nation, parent of Ticketmaster
DOJ Sues Live Nation: Monopoly Crackdown?
The U.S. Department of Justice, supported by 30 states, has filed a lawsuit against Live Nation, the parent company of Ticketmaster, for alleged antitrust violations. This follows a 2022 DOJ investigation triggered by consumer complaints during Taylor Swift's Eras tour ticket sales. The lawsuit claims Live Nation abuses its dominant market position, leading to higher fees for fans and fewer choices for venues and artists.
Live Nation controls about 80% of primary ticketing for major concert venues through Ticketmaster. The DOJ alleges that Live Nation's practices stifle competition by enforcing exclusive agreements with artists and venues, and by retaliating against those who work with competitors. Live Nation refutes the claims, arguing that the lawsuit misunderstands the causes of high ticket prices and will not improve ticket costs or service fees.
What specific antitrust violations is the U.S. Department of Justice accusing Live Nation and Ticketmaster of committing?
The U.S. Department of Justice is accusing Live Nation and Ticketmaster of committing antitrust violations by maintaining a monopoly in the live events industry. The lawsuit alleges that Live Nation relies on unlawful, anticompetitive conduct to exercise its monopolistic control over the industry, resulting in higher fees for fans, fewer opportunities for artists to play concerts, smaller promoters being squeezed out, and venues having fewer real choices for ticketing services. The Justice Department's complaint claims that Live Nation maintains a self-reinforcing business model by capturing fees and revenue from concert fans and sponsorships, using that revenue to lock artists into exclusive promotion deals, and then using its dominance to lock new concert venues into long-term exclusionary contracts.
How has Live Nation responded to the DOJ's allegations of maintaining a monopoly in the ticketing industry?
Live Nation has strongly rejected the U.S. Department of Justice's allegations that it maintains a monopoly in the ticketing industry, labeling the claims as "absurd." In a detailed response, Live Nation argues that the DOJ's complaint inaccurately portrays the company as the source of consumer frustration within the live entertainment sector. The company asserts that neither concert promoters nor ticketing companies control ticket prices, which are influenced by various factors including rising production costs, artist popularity, and persistent online ticket scalping25. This scalping demonstrates, according to Live Nation, the public's willingness to pay prices well above the primary ticket costs2. Live Nation contends that the lawsuit overlooks these real contributors to high ticket prices and instead unfairly targets their business operations. Furthermore, Live Nation stresses that their service charges are comparable to or lower than other providers, and they highlight their relatively low net profit margin compared to other S&P 500 companies. They maintain that the lawsuit will not lead to lower ticket prices or service fees, as these are set by the artists and the venues.