Lawsuit attempts to strip Live Nation of its power over concert-goers

The U.S. Justice Department is suing Live Nation to break up the entertainment company. Photo by ConsumerAffairs and Live Nation

Live Nation says it’s going to fight the power

Just like the Department of Justice (DOJ) has done with other companies that it thought had gotten too big for their britches, it’s decided to go after Live Nation for allegedly monopolizing live events and overcharging consumers.

The agency along with a bipartisan coalition of 30 attorneys general, has sued Live Nation for those very things.

The coalition doesn’t want to bring Live Nation down and put it out of business. It just wants – as New York Attorney General Letitia James put it, Live Nation to end its “abusive and anticompetitive conduct to protect fans, artists, and venues and … pay for their wrongdoing.”

“For too long, Live Nation and Ticketmaster have unfairly and illegally run the world of live events, abusing their dominance to overcharge fans, bully venues, and limit artists,” James said.

“When companies like Live Nation control every aspect of an event, it leads to bad blood – concertgoers and sports fans suffer and are forced to pay cruel prices. Everybody agrees, Live Nation and Ticketmaster are the problem, and it’s time for a new era. Today, we are taking this important action to protect consumers and force big companies to stop abusing their influence and get in formation.” 

Large and in charge

In all honesty, Live Nation is large and in charge. It owns, operates, or has exclusive booking rights for hundreds of venues nationwide, including New York’s Madison Square Garden, Bonnaroo Music and Arts Festival, Milwaukee, Utah and Austin. 

In the good old days of live events, there would be a promoter and a venue and they would work together, but Live Nation controls lots more than that. It can own the venue, it can hire the acts, and it might hold all the ticketing rights.

That ticketing element is what may have done Ticketmaster in. It controls an estimated 70%-80% of the ticketing industry and those behind the suit say that that gives the company power to force out competitors and, in turn, leave venues, and artists with limited options. And consumers? They may be the unhappiest of the bunch.

What the state attorneys and the DOJ want to stop

There are three things the lawsuit seeks to change in the consumer’s favor: 

  • The plaintiffs want Live Nation to be transparent, give more options when purchasing tickets, and have more concert choices. This aspect may be the easiest to do since Live Nation already agreed with President Biden to pull back on "junk fees."

  • Give artists more opportunities to play concerts, more choices for promoting their concerts and the option of selling tickets to their own shows; and

  • Allow venues more options for obtaining concerts and ticketing services, and not force them to continue using Live Nation and Ticketmaster, or to pass the higher costs onto consumers. 

And Live Nation? It doesn’t have much choice. It could decide to break itself up and sell off pieces of the company or it could fight back like it was Metallica on fire. You can guess which route it’s decided on.

In breaking down the lawsuit, Dan Wall, executive vice president, Corporate and Regulatory Affairs, Live Nation Entertainment, fiercely defended his company, essentially saying that the lawsuit “won’t reduce ticket prices or service fees.”

Live Nation also claimed that it’s hurting because of “more competition than ever in the live events market,” and that Ticketmaster’s market share has declined since 2010.

“This lawsuit distracts from real solutions that would decrease prices and protect fans – like letting artists cap resale prices,” Wall claimed.

Wall went on to illustrate that despite what some may think are high fees, Live Nation/Ticketmaster’s share of the “take rate” is much lower than other companies in other consumer categories. 

PhotoWall said that, in no way, shape, or fashion does his company have the traditional markings of a “monopoly.” 

Service charges on Ticketmaster are no higher than on SeatGeek, AXS, or other primary ticketing sites, and are frequently lower.  In fact, when Ticketmaster loses a venue to SeatGeek, service charges usually go up substantially.  And even accounting for sponsorship, an advertising business that helps keep ticket prices down, Live Nation’s overall net profit margin is at the low end of profitable S&P 500 companies,” Wall asserted.

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