The attorneys general of 10 states have joined the US Department of Justice (DoJ)’s antitrust lawsuit seeking to break off Live Nation from its ticketing subsidiary, Ticketmaster.
The state prosecutors of Indiana, Iowa, Kansas, Louisiana, Mississippi, Nebraska, New Mexico, South Dakota, Utah and Vermont have now added themselves to the lawsuit that was originally filed against the live music giant in May, the DoJ said in a statement issued on Monday (August 19).
That means a total of 39 US states, plus the District of Columbia, are now part of the lawsuit.
The DoJ also filed an amended complaint against Live Nation, which “alleges additional details about Live Nation-Ticketmaster’s anticompetitive course of conduct in markets across the live entertainment industry.”
Following an 18-month investigation, the DoJ filed the antitrust suit against Live Nation on May 23, alleging the company engaged in “monopolization and other unlawful conduct” designed to thwart competition in the live music industry.
Almost concurrently, Live Nation was hit with a proposed consumer class action lawsuit brought on behalf of potentially millions of ticket buyers in the US.
Live Nation has vigorously defended itself against accusations of monopolistic behavior, both before and after the DoJ filed its suit, arguing – among other things – that it doesn’t enjoy the large margins seen in businesses that have monopolized their industries, and that breaking up Live Nation and Ticketmaster won’t bring lower prices to consumers, because it’s not Ticketmaster that determines prices.
“Tickets are actually priced by artists and [sports] teams. It’s their show, they get to decide what it costs to get in. The NFL tickets on Ticketmaster were priced by the home teams, concert tickets were priced by the performer’s business teams, Monster Jam tickets were priced by its producer (Feld Entertainment), and so forth,” Live Nation wrote in a blog post in March.
In a response to the DoJ lawsuit, Live Nation said the suit “ignores everything that is actually responsible for higher ticket prices, from increasing production costs to artist popularity, to 24/7 online ticket scalping that reveals the public’s willingness to pay far more than primary tickets cost.
“It blames Live Nation and Ticketmaster for high service charges, but ignores that Ticketmaster retains only a modest portion of those fees. In fact, primary ticketing is one of the least expensive digital distributions in the economy.”
“Artists and fans as well as the countless people and other services that support them suffer from the loss of dynamism and growth that competition would inevitably usher in.”
Amended DoJ complaint against Live Nation
To back up its point, Live Nation published a chart showing that its 5% commission on tickets is lower than many other platforms, including Airbnb (17.2%), Uber (25%), and rival ticket seller StubHub (37%).
The DoJ maintains that “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.”
In their amended complaint, filed on Monday in the US District Court for the Southern District of New York, the attorneys general said Live Nation directly manages more than 400 musical artists, controls around 60% of concert promotions at major venues across the US, and owns or controls 60 of the top 100 amphitheater venues in the country.
The full complaint can be read here.
Ticketmaster, meanwhile, controls “80% or more of major concert venues’ primary ticketing for concerts and a growing share of ticket resales in the secondary market,” the complaint stated.
That dominant position in the live entertainment space has given Live Nation the “power and influence to insert themselves at the center and the edges of virtually every aspect of the live music ecosystem. This has given Live Nation and Ticketmaster the opportunity to freeze innovation and bend the industry to their own benefit. While this may be a boon to Live Nation’s bottom line, there is a real cost to Americans,” the complaint continued.
“Artists and fans as well as the countless people and other services that support them suffer from the loss of dynamism and growth that competition would inevitably usher in.”Music Business Worldwide