Live Nation Entertainment Faces Scrutiny Over Unfair Business Practice
Taylor Swift will headline the upcoming Eras Tour, starting March 17, 2023. Source for Image: Yahoo! News
On Thursday, Nov. 17, 2022, Ticketmaster announced their plan to cancel the public sale of tickets to Taylor Swift’s latest tour after experiencing unprecedented presale demand. Registrants for the presale event on Tuesday totaled 3.5 million people but only 1.5 million were granted purchasing access, leaving the remaining fans on a waitlist, according to Ticketmaster.
The highly anticipated presale event broke Ticketmaster’s record for sales in a single day, amounting to over 2 million tickets sold. Now, with all 52 shows sold out, the waitlisted and remaining fans have been left ticketless and frustrated. Moreover, Ticektmaster’s market domination in the live entertainment industry sparked additional controversy during the ticket buying process. Presale customers reported crashes in Ticketmaster’s website, slow moving queues and additional issues with the Ticketmaster website, which prompted many fans to take the day off of work or rearrange their schedule in anticipation of difficulties.
Fans were also caught off guard when they were subjected to dynamic pricing — price fluctuations based on demand — when selecting tickets. Although it had been reported that ticket prices would range from $49 to $449, with VIP packages costing anywhere from $199 to $899, the price of presale tickets deviated from the original quotes. It was later confirmed that Swift opted to use dynamic pricing, yet this strategy of driving up ticket prices isn’t uncharacteristic of Ticketmaster. Plus Ticketmaster's processing fees, which are charged in addition to the price of the ticket, added to the cost causing the final total of the tickets to surpass the expected amount.
Over the past decade, Live Nation Entertainment, Ticketmaster’s parent company, has strategically encroached on fans, venues and artists to maximize their profits and crush their industry competitors. In Live Nation’s 2022 third quarter report, the company revenue grew by 63 percent and reached a total of $6.2 billion. Up to this point the company had sold more than 115 million tickets in 2022, excluding presale tickets to the Eras Tour – the upcoming tour Taylor Swift will be headlining. And with no real competitors in the industry, consumers have begun to call out the company’s unfair ticket pricing tactics and monopolistic-like practices in the industry.
But if it's any consolation, a multitude of politicians, activists and now ‘Swifites’ are calling on the Department of Justice to ease the purchasing burden placed on consumers by demanding new legal constraints for Live Nation Entertainment. Recognition of this issue has reached The White House as President Joe Biden has promised to slash “hidden junk fees,” such as processing fees, charged by large corporations. However, another coalition of economic activists have taken a more radical position on the matter. Brought about in response to outrageous ticket prices, the “Break Up Ticketmaster” campaign is calling on the DOJ to “unwind” the Live Nation and Tikcketmaster merger. The coalition group claims that the merger is disincentivizing market competition, thus allowing Live Nation Entertainment to hike up ticket prices, charge unfair junk fees and manipulate artists and venues.
In 2010, when Ticketmaster and Live Nation Entertainment merged, Christine Varney, the former Assistant Attorney General of the Department of Justice(DOJ) Antitrust Division, failed to accurately project the economic effects of the Ticketmaster/Live Nation Entertainment merger. According to the DOJ’s Consent Decree, Varney claimed that the merger would not “substantially lessen competition in the market” and that the DOJ’s role in the merger was limited to preventing “anticompetitive harms'' that arose. But based on a decade of empirical effects of the merger, demonstrated by the trainwreck sale of tickets to Swift’s Eras Tour and other Ticketmaster sale fiascos to live performances, such as Bruce Springsteens’s tour, it is evident that Live Nation Entertainment's abuse of market power is testing the limits of business ethics and American Antitrust laws.
The reality of this merger has created a corporation that routinely deprives consumers of the benefits of market competition and profits off charging exorbitant prices and fees for access to live entertainment. The Consent Decree’s weak attempt at implementing antitrust safeguards and Varney’s blatant dismissal of legitimate consumer concerns regarding the merger exemplifies the ableist role the DOJ has played in the Ticketmaster/Live Nation Entertainment merger. To date, the current passivity of the DOJ in addressing their flawed justification for the monopolistic merger is largely to blame for Live Nation Entertainment cheating American consumers.
Ultimately, the apolitical nature of accessing and affording live entertainment creates a powerful and unifying opposition toward corporate monopolistic-like practices that hurt the American public. Until recently, political emphasis on rectifying the harmful effects of the merger, during Democratic and Republican administrations and party-majorities in Congress, have been minimal. If anything, while unruly corporate behavior is problematic, the Eras Tour ticket buying experience should spark scrutiny and skepticism over both political parties — with politicians who pledge to act in the best interest of their constituents — which have continuously afforded Live Nation Entertainment unwavering market domination.