CFO expects Live Nation ‘to prevail’ in DOJ suit
Live Nation’s Joe Berchtold has said he expects the company “to prevail” in the Department of Justice’s (DOJ) antitrust suit.
The LN president/CFO addressed the issue as part of an interview at the Bank of America Securities Media, Communications & Entertainment Conference yesterday (4 September).
“I expect we’re going to prevail,” said Berchtold. “I don’t expect we’re going to have major changes to how we operate through the process we have to go through with the DOJ. But I can’t ultimately control some of the politics, so we’ll just continue to build each of the businesses to best we can.”
The lawsuit accuses LN-Ticketmaster of monopolisation and other unlawful conduct. Last month, the DOJ and a group of co-plaintiffs, including 10 additional states, filed an amended complaint in the Southern District of New York, further alleging “additional details about Live Nation-Ticketmaster’s anticompetitive course of conduct in markets across the live entertainment industry”.
“We’re in process now,” explained Berchtold. “We’re going through motions back and forth with the DOJ. I think next year is a period of discovery and depositions, and then the trial would begin in early ’26 if nothing between now and then happens that would let us come to an agreed resolution.”
“I get that, at times, Ticketmaster will inherently bear the criticism when 10 million people want to buy a million tickets”
Earlier, Berchtold responded to a question about how important it was that Ticketmaster remained part of Live Nation following the firms’ 2010 merger.
“It’s a nice complement,” he said. “We believe that it gives us the ability to earn more money on the risk that we take in putting on the concert, which we think is reasonable. We run the businesses very separately… But I think they’re both great businesses.”
Berchtold praised Ticketmaster as a “great platform to sell concert tickets” and trumpeted its innovations and advocacy work on topics such as all-in pricing, bots and spec-selling. But without directly referencing past controversies or the current dynamic pricing row in the UK, he suggested there was room for improvement on the consumer side.
“We’re very strong supporters of giving artists more control over how their tickets are distributed and ultimately resold, but underlying all of that is better communication, better transparency,” he said. “How do we let the fan know what to expect? I’d love to make the front row a mile wide and cost $39, but that’s not reality. So I get that – at times – Ticketmaster will inherently bear the criticism when 10 million people want to buy a million tickets, and so 90% of the people are going to be inherently unhappy.
“That is the nature of the industry that we’re in. But we can absolutely do a better job around some of the pieces to set up the expectations in terms of what fans should be seeing.”
“In 2015, we had about 90 artists that we sold over 100,000 tickets for… This year, we expect that number to be about 250”
The wide-ranging 40-minute interview also explored topics such as innovative LN venue projects such as GNP Seguros Stadium in Mexico and Adele’s pop-up stadium in Germany.
“We’re seeing great opportunities for a GNP-type model that we have in Mexico City, where it’s a bit of an amphitheatre meets a stadium,” he said. “I think we’ve learned a lot from the ‘Adele World’ experience that was a raging success: can you take some of those temporary, semi-permanent, open venues and do more with that?”
Berchtold stressed that globalisation was driving the next phase of the live entertainment industry, crediting streaming and latterly social media with accelerating that growth.
“Artists that have been touring are continuing to tour, but every year – because of the distribution, because of the social media platforms – you’re adding more artists into the mix,” he observed. “In 2015, we had about 90 artists that we sold over 100,000 tickets for. That number had grown to about 150 to 155 by 2019. This year, we expect that number to be about 250.
“You’ve got a top number that are selling over 500,000 and that’s continuing to grow – particularly as you see continued growth in stadium volume. But it’s that 100,000-plus that’s really telling you the robustness of the supply that’s continuing to grow on a global basis.”
“It’ll be a great year on every front we expect next year, because of that supply coming back on the stadium side in particular”
In a further evolution of the business, Berchtold said top acts were typically touring for longer, taking on “20-50%” more dates, with international shows accounting for the lion’s share.
“Ten years ago, the conversation was, ‘Let’s talk about the US tour and maybe some European dates.’ Now it’s, ‘Let’s talk the three-year plan. What’s the role of the US, Europe, Latin America? Do we do Asia? Where do we do festivals in there, versus tours? How do we think about that cycle?’ So the conversations are much more extended and the international legs are a lot longer.”
Echoing LN CEO Michael Rapino’s forecast of a strong resurgence for stadium shows in 2025 after this year’s schedule was reduced due to the Paris Olympics, Berchtold said next year was shaping up to be “the best of both worlds”.
“We see very strong growth in our stadium volume, but also continued growth in our arena volume,” he said. “That growth right now is probably a little more international than North America, but North America is growing as well.
“It’ll be a great year on every front we expect next year, because of that supply coming back on the stadium side in particular.”
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Ten more states join DOJ suit against Live Nation
Ten additional states have joined the Department of Justice’s (DOJ) antitrust lawsuit against Live Nation.
The attorneys general (AGs) of Indiana, Iowa, Kansas, Louisiana, Mississippi, Nebraska, New Mexico, South Dakota, Utah and Vermont have backed the DOJ’s lawsuit, first filed in May, which accuses LN-Ticketmaster of monopolisation and other unlawful conduct.
The DOJ and its expanded group of 40 co-plaintiffs have now filed an amended complaint in the Southern District of New York, also alleging “additional details about Live Nation-Ticketmaster’s anticompetitive course of conduct in markets across the live entertainment industry”.
The bipartisan coalition is seeking treble the monetary damages initially sought from the companies, who merged in 2010.
“Live Nation and Ticketmaster have abused the market to overcharge consumers and harm venues and artists”
“Live Nation and Ticketmaster have abused the market to overcharge consumers and harm venues and artists, and my office will ensure this illegal conduct is stopped,” says New York AG Letitia James. “Through this version of the amended lawsuit against Live Nation and Ticketmaster, my office is seeking to recover damages for New York consumers who were overcharged by Live Nation and Ticketmaster.
“It’s time for a new era where fans, venues, and artists are not taken advantage of by big corporations that run the world of live events.”
The DOJ’s allegations include acquiring competitors and competitive threats, restricting artists’ access to venues, threatening and retaliating against venues that work with rivals, locking out competition with exclusive contracts and blocking venues from using multiple ticketing firms. It also claims the firm “exploits” its relationship with venue giant Oak View Group (OVG).
“Live Nation’s conduct has harmed fans because they have been left with fewer concerts, have had more limited choices among touring artists, have paid higher ticketing fees and have experienced a lower-quality ticketing experience than they otherwise would have but for Live Nation’s anticompetitive conduct,” reads the revised complaint.
A Live Nation spokesperson says there is “nothing new” in the amended lawsuit.
“The lawsuit still won’t solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows”
“The lawsuit still won’t solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows,” adds the spokesperson. “We look forward to sharing more facts as the case progresses.”
Live Nation’s EVP, corporate and regulatory affairs Dan Wall has also issued an updated response to the suit in an online post.
“Live Nation is in the business of bringing the joy of live entertainment to people and to that end connecting artists to fans and supporting a productive live entertainment ecosystem,” says Wall. “That is what we do – better than anyone else – and what we will continue to do as we challenge this lawsuit.”
Wall, who joined Live Nation last year after more than 12 years as a key advisor to the firm, adds: “Is the ticketing marketplace confusing to consumers? Yes, it certainly is. And we have been very clear in the halls of Congress and at the DOJ that we favour genuine reforms that would actually help fans get tickets at the price the artist has set for them to pay.
“Fans want to see the bands and sports teams they love, and it infuriates them that tickets sell out on Ticketmaster and are then available by the hundreds on secondary online sites at double and triple the cost. But the government has chosen to do nothing about this. Instead, it has filed a case which misleads the public into thinking that ticket prices will be lower if something is done about Live Nation and Ticketmaster.”
Earlier this summer, a New York judge said the case could go to trial in early 2026.
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Legends settles with DOJ over ASM deal complaint
Legends has reached a US$3.5 million (€3.2m) settlement with the US Department of Justice (DOJ) after being accused of “illegal premerger coordination” in connection with its planned purchase of ASM Global.
The New York-headquartered premium experiences giant confirmed in November 2023 that it had agreed to acquire ASM in a reputed $2.4 billion deal – subject to regulatory approvals – creating a premium global live events firm.
However, the DOJ filed a civil lawsuit in the Southern District of New York, alleging Legends had exercised “operational control over aspects of ASM during the HSR waiting period involving venue management services for an arena in California”.
The HSR (Hart-Scott-Rodino) Act prohibits companies from “improperly combining operations or other aspects of their businesses” until the required waiting period has expired.
“Companies must remain separate and independent before they close their merger,” says deputy assistant attorney general Andrew Forman of the Justice Department’s antitrust division. “Our complaint alleges that Legends did not live up to that obligation.”
At the same time as filing the lawsuit, the DOJ put forward a proposed final judgment that, if approved by the court, would resolve the case.
“We look forward to closing our deal with ASM Global this month”
Under the terms of the settlement, which offers no determination of liability, Legends must pay a $3.5m civil penalty, refrain from certain conduct, appoint an antitrust compliance officer, implement an antitrust training and compliance program and submit regular compliance reporting to the department.
“The proposed settlement requires Legends to pay a meaningful civil penalty and imposes significant obligations to try to ensure that Legends complies with the law moving forward,” adds Forman. “I commend our tremendous investigative teams who remain vigilant in trying to ensure that there is no improper coordination between parties before closing.”
Founded in 2008, Legends is backed by global investment firm Sixth Street. Its clients include prestigious brands such as Real Madrid, SoFi Stadium, Dallas Cowboys, FC Barcelona, New York Yankees and the Ryder Cup.
A spokesperson for Legends says the ASM acquisition remains on track to close before the end of August.
“We are pleased this matter is resolved,” says the spokesperson. “Moving forward, we are focused on continuing to serve our clients, and we look forward to closing our deal with ASM Global this month.”
Los Angeles-headquartered ASM Global, which was formed in 2019 following a merger between arena operators AEG Facilities and Onex’s SMG, operates buildings including ICC Sydney Convention Center, Avicii Arena in Stockholm, OVO Arena Wembley, Coca-Cola Arena in Dubai and State Farm Stadium in Glendale, Arizona.
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Live Nation gears up for ‘big banner year’ in 2025
Live Nation posted $6.02 billion (€5.6bn) revenue in a record Q2 2024 as bosses say it is “business as usual” at the company, amid the DOJ’s antitrust lawsuit.
Revenue was up 7% on the equivalent quarter last year, while operating income rose 21% to $466 million and AOI 21% to $716m, with the key metrics pointing to another record-setting year for the firm.
Year-to-date ticket sales for its 2024 concerts are 118 million – 1m higher than at the same point 12 months ago – powered by double-digit increases for arena, amphitheatre, theatre and club shows. LN’s venue management outfit Venue Nation has hosted 24 million fans year-to-date – up 10% – and is on course to host more than 60m fans this year.
“We continue to see strong demand globally, with a growing variety of shows attracting both casual and diehard fans who are buying tickets at all price points, which speaks to the unique experience only live concerts can provide,” says Live Nation president and CEO Michael Rapino.
“Venue Nation’s strategic investments in hospitality and infrastructure are driving strong returns as more attendees maximise their onsite experiences.
“While operating income will be impacted negatively by one-time accruals, we are on track to deliver double-digit AOI growth for the year and look forward to a very busy 2025.”
“The good news is, as we predicted, ’25 looks likely to be a big banner year again”
Taking questions from shareholders during yesterday’s earnings call, Rapino noted the positive results came in spite of a quieter period for stadium concerts – in part, due to Paris hosting the Olympic Games – and added that 2025 was shaping up to be “a big banner year”.
“We’re thrilled that we can still grow the business coming off two years of extraordinary growth, given where we were in 2019, so it’s still a strong year for us overall,” he said. “Stadiums were always the challenge, international was always going to be a stadium issue given Paris Olympics. Most of France shut down for that month, and most of that affected a lot of the stadium business for the summer.”
Rapino continued: “The good news is, as we predicted, ’25 looks likely to be a big banner year again. We’re looking right now at our stadium pipeline for ’25. It’s bigger right now than it was two years ago for ’23. Our amphitheatre and arena is bigger right now than it was last year at this time in terms of our pipeline. So we’ve always thought 2024 would be the year of AOI and amphitheatres and arenas and ’25 will be back to a solid continual growth of stadiums.
“As we’ve always predicted post-Covid, we’d be back to an 8%, 9% compounded annual growth as an industry on the top line, and we’ll see that come back to life next year and probably more.”
“This is a supply driven business,” added Berchtold. “The demand is there, notwithstanding the fact we have a lot fewer stadiums this year, we’re actually still growing our show count. We’re still growing our fan count.”
International markets remain a key driver of the growth, he said.
“I think what we’re seeing is an acceleration of the continued globalisation on the demand side, the artist seeing that they can go everywhere in the world,” reflected Berchtold. “We’ll have some shifts in terms of venue types and exactly which markets have which level of activity. But there’s nothing that would suggest that we’re really deviating from historical trajectories on the ongoing growth of the business.”
“If you’re in my legal department, you’re working on the DOJ. If you’re running any one of my divisions, it’s business as usual”
Asked whether the DOJ lawsuit was impacting strategic decision-making at the company, Berchtold said: “We’re able to isolate. So if you’re in my legal department, you’re working on the DOJ. If you’re running any one of my divisions, it’s business as usual.”
Berchtold pointed to opportunities around new venues (“I had a venue meeting this morning. We looked at 10 new venues that we’re looking to build across the US, Latin America and Asia in the pipe”) and ticketing, referencing Ticketmaster’s recent acquisition of leading African ticketing platform Quicket (“Last week, we expanded ticketing in South Africa and have a few more of those on an international basis”).
“So lots of opportunities still ahead of us, and business as usual in the divisions,” he concluded.
Berchtold also played down concerns regarding tour cancellations, saying there had been no more than normal.
“In terms of our cancellation rates, we’re seeing historical norms below last year,” he said. “They historically run kind of 4% to 5% of shows, about 1.5% of fans, absolutely in line with historical trends. I think most of the reports that we’ve seen have been efforts to take one or two data points out of a very large number of tours and shows, and we’re just not seeing anything unusual there.”
The Q2 report also mentioned $279.9m in “Astroworld estimated loss contingencies” for the first half of 2024. All wrongful death lawsuits filed over the 2021 festival disaster were settled earlier this year.
Live Nation’s share price was up to $95.08 this morning, giving the company a market cap of $22bn.
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Live Nation fires back at DOJ antitrust lawsuit
Live Nation’s Dan Wall has insisted there is no “good faith argument” to break up the company with Ticketmaster amid the fallout from the Department of Justice’s (DOJ) antitrust lawsuit.
Wall, the company’s EVP, regulatory affairs, joined president/CFO Joe Berchtold on a call with investors to discuss the suit, which accuses LN and Ticketmaster, who merged in 2010, of engaging “in a variety of tactics to eliminate competition and monopolise markets”.
The DOJ’s allegations include acquiring competitors and competitive threats, restricting artists’ access to venues, threatening and retaliating against venues that work with rivals, locking out competition with exclusive contracts and blocking venues from using multiple ticketing firms. It also claims the firm “exploits” its relationship with venue giant Oak View Group (OVG).
Live Nation’s share price dropped in the wake of yesterday’s (23 May) announcement but has since stabilised.
Speaking to shareholders on the regulatory update call, Berchtold said he had been optimistic of reaching a resolution with the DOJ prior to the filing in the United States District Court Southern District of New York.
“We didn’t see any of the issues to be structural or fundamental to the nature of the makeup of the company,” he said. “[We] saw them all as discrete business practices and were hopeful that, because of that, we would be able to reach a settlement. Obviously, that wasn’t their agenda, ultimately, and we are where we are today.”
“It is exactly the concerns that were considered by the Obama administration 15 years ago, and that are covered by the consent decree”
Berchtold suggested one area of “disconnect” with the DOJ centred on the definition of competition in the marketplace.
“In our mind, competition is competing in the promotion side with the artist as the consumer, and then that artist very effectively engages multiple bidders to compete for their services,” he said. “The artist takes an increasing portion of the money from the show, and they are the beneficiary of that competition.
“The DOJ has a different view in terms of holding us accountable for the service fees and the ticket prices, even though we’re not the beneficiary to the largest extent of either those numbers. We don’t unilaterally make the decision on what those numbers are going to be; they’re driven primarily by the venues and by the promoter. So we clearly don’t agree with them in terms of the fundamental of the assertions that they’re making.”
Wall, who joined Live Nation last year after more than 12 years as a key advisor to the firm, alluded to US attorney general’s Merrick Garland’s statement that it was “time to break up Live Nation-Ticketmaster”.
“It is exactly the concerns that were considered by the Obama administration 15 years ago, and that are covered by the consent decree,” he argued. “And in those circumstances, we just don’t believe that there’s really any good faith argument to be made here that there could be a breakup. However, we all know that that’s what the most effective way to get the big headlines was and I think that that’s why we’re seeing that. It’s very unfortunate.
“There’s never been a circumstance where the DOJ allowed a merger to happen under a consent decree with behavioural remedies, which it said was an effective remedy, and then came back later and tried to say that that should be broken up.”
“We will make every effort to try to get this case to trial in a year”
Addressing the likely timescale of the case, Wall said: “We will move this along as quickly as we can. We will make every effort to try to get this case to trial in a year, or if not in a year, a year and a half, and certainly not long after that. We’re committed to putting the resources in to get that done and getting this behind us because we feel very confident about about our position on these claims.”
He was also critical of the DOJ’s demand for a jury trial, dismissing the move as a “stunt”.
“This is a stunt, a strategy that the DOJ used in the Google ad-tech case, and it’s highly unusual in that antitrust cases like this, historically, have always been tried to to judges rather than juries – because when the government is the plaintiff, it is seeking injunctive relief and all claims for injunctive relief are tried by judges rather than juries.
“It seems like a pretty transparent effort to try to avoid the scrutiny of a judge. And I don’t think it’s necessarily a smart move, because the very first message that you send to the judge is that you don’t really want him or her to have control over the outcome of this, and that’s not a very smart message to send a judge at the beginning of a case.”
Wall was also asked about the implications for the lawsuit of a potential administration change, should Donald Trump return to the White House following November’s US election.
“That’s a tough one, for sure,” he said. “If we just kind of go back in time and you asked me whether I think that the first Trump administration would have brought this case, I would tell you that I don’t think that any prior administration – Republican or Democrat – would have brought this case. But the circumstances, looking to the future, it would depend a lot on who was appointed to these positions, and that just makes it kind of vulnerable.”
“Live Nation has scolded Oak View Group multiple times for trying to compete”
The 128-page filing makes reference to LN’s relationship with OVG, which it describes as a “potential-competitor-turned-partner that has described itself as a ‘hammer’ and ‘protect[or]’ for Live Nation.
“In recent years, Oak View Group has avoided bidding against Live Nation for artist talent and influenced venues to sign exclusive agreements with Ticketmaster,” it states. “For example, Live Nation has scolded Oak View Group multiple times for trying to compete. In one instance, Live Nation asked, ‘who would be so stupid to… play into [an artist agent’s] arms,’ and on another occasion, Live Nation stated, ‘let’s make sure we don’t let [the artist agency] now start playing us off.’
“Live Nation and Oak View Group have colluded and established a partnership to allocate business lines, avoid competing with each other, and chart a mutually beneficial plan to cement Live Nation’s dominance.”
Wall has contested the claims in a lengthy blog, pointing out that OVG is a venue management company rather than a concert promoter.
“DOJ’s claim is based on two incidents in which Live Nation and OVG were discussing what to do when an OVG venue wanted to book on occasional show itself on a dark night,” he continued. “To portray that as an agreement not to compete in concert promotion is farcical.
“Regardless, OVG’s behaviour as a venue operator is fully consistent with every major arena and stadium in the country – they need to have an in house booker who helps fill otherwise dark nights, but they have no interest in systematically taking on the risk of guarantees that could be in the millions of dollars for a show or tens of millions of dollars for a tour.”
“There is no truth that this brief exchange had anything to do with Silver Lake’s decision to sell its stake in TEG”
In another startling allegation, it says that LN threatened commercial retaliation against private equity firm Silver Lake in 2021, unless the latter’s subsidiary TEG stopped competing with Live Nation for artist promotion contracts in the US. It claims that the threats “ultimately succeeded, and Silver Lake has tried to sell TEG altogether”.
“This claim reveals not only a disregard for the facts, but also deep hypocrisy,” replied Wall. “The current DOJ and FTC have been vocal critics of private equity companies making multiple investments in the same industry because of competitive ‘entanglements’. So was Live Nation CEO Michael Rapino when, after it had already made an investment in OVG, Silver Lake Partners decided to invest in the Australian live entertainment company, TEG.
“Rapino’s complaint was fundamentally the same as the DOJ/FTC concern with private equity rollups: it created a conflict between OVG, which had become a close partner to Live Nation, and TEG. So, in December 2021 when a TEG employee wrote to say that it did not intend to compete with Live Nation in the US, Rapino replied to Silver Lake’s management that he did not care about TEG, but still had a problem with Silver Lake’s decision to make multiple conflicting investments in the industry.
“There is no truth that this brief exchange had anything to do with Silver Lake’s decision to sell its stake in TEG.”
Elsewhere, Variety has published an article asking whether things would get better for fans in the event of a Live Nation-Ticketmaster breakup.
“In reality, music fans’ concerns boil down to one question: Would breaking up the two companies make the ticket-acquisition process less of a soul-crushing nightmare?” writes Jem Aswad. “In the short term anyway, the answer is pretty much no… In fact, the things that most enrage fans – cryptic ‘service’ fees, long wait times, the predatory secondary market and its bots that buy up blocks of tickets before ordinary humans can get near them – are outside the purview of the lawsuit.
“It also must be noted, as Live Nation often does, that Ticketmaster does not set ticket prices – artists or promoters do – and it does not charge the bulk of the service fees that so enrage fans (venues do).”
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DOJ sues Live Nation over alleged ‘monopoly’
The US Department of Justice (DOJ) has launched a lawsuit which could seek to break up Live Nation-Ticketmaster after alleging the company has violated antitrust laws.
The 128-page filing accuses LN and Ticketmaster, who merged in 2010, of using their “power and influence” to “insert themselves at the centre and the edges of virtually every aspect of the live music ecosystem”. Live Nation’s EVP, regulatory affairs, Dan Wall has issued a response, contesting the claims.
The suit, which had been expected for several weeks, was filed today (23 May) in the United States District Court Southern District of New York. It states that Live Nation directly manages more than 400 musical artists and controls around 60% of concert promotions at major venues across the country, as well as owning or controlling more than 265 concert venues in North America.
“This has given Live Nation and Ticketmaster the opportunity to freeze innovation and bend the industry to their own benefit,” it claims. “While this may be a boon to Live Nation’s bottom line, there is a real cost to Americans.
“Through a self-reinforcing ‘flywheel’ that Live Nation-Ticketmaster created to connect their multiple interconnected businesses and interests, Live Nation and Ticketmaster have engaged in numerous forms of anticompetitive conduct.”
In adds that LN controls “roughly 80% or more” of primary ticketing for major concert venues via Ticketmaster, plus a “growing share” of the resale market.
“Live Nation’s monopoly, and the anticompetitive conduct that protects and maintains its monopoly, strikes a chord precisely because the industry at stake is one that has for generations inspired, entertained, and challenged Americans,” it continues. “Conduct that subverts competition here not only harms the structure of the live music industry and the countless people that work in that industry, but also damages the foundation of creative expression and art that lies at the heart of our personal, social, and political lives.”
“We allege that Live Nation relies on unlawful, anticompetitive conduct to exercise its monopolistic control over the live events industry in the US”
Allegations include acquiring competitors and competitive threats, restricting artists’ access to venues, locking out competition with exclusive contracts and blocking venues from using multiple ticketing firms.
“We allege that Live Nation relies on unlawful, anticompetitive conduct to exercise its monopolistic control over the live events industry in the United States at the cost of fans, artists, smaller promoters, and venue operators,” says a statement from US attorney general Merrick Garland. “The result is that fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters get squeezed out, and venues have fewer real choices for ticketing services. It is time to break up Live Nation-Ticketmaster.”
Dan Wall, LN’s EVP, corporate and regulatory affairs, has penned a lengthy response to the lawsuit, which he says comes in the wake of “intense political pressure on DOJ to file a lawsuit, and a long-term lobbying campaign from rivals and ticket brokers seeking government protection for themselves”.
Furthermore, Wall describes the claim that Live Nation and Ticketmaster are wielding monopoly power as “absurd”.
“The defining feature of a monopolist is monopoly profits derived from monopoly pricing,” he says. “Live Nation in no way fits the profile. Service charges on Ticketmaster are no higher than elsewhere, and frequently lower. And even accounting for sponsorship, an advertising business that helps keep ticket prices down, the company’s overall net profit margin is at the low end of profitable S&P 500 companies.
“Every year, competition in the industry drives Live Nation to earn lower take rates from both concert promotion and ticketing. The company is profitable and growing because it helps grow the industry, not because it has market power.”
“The world is a better place because of that merger, not a worse one”
In closing, Wall insists that Ticketmaster is “a far better, more artist and fan-focused business under Live Nation’s ownership than it ever was as a standalone company”.
“But that’s not how this DOJ sees it. They are reflexively antagonistic to vertical integration,” he says. “The Obama Administration saw it differently. It allowed Live Nation and Ticketmaster to merge, and in defending that position acknowledged that there was no legal basis for challenging the vertical aspects of the merger – specifically, allowing a large concert promoter to combine with a large ticketing company.
“In one filing, it said that it had ‘determined that it could not prove that the vertical integration resulting from the merger would significantly harm competition in the concert promotion market.’ There is no factual basis for concluding otherwise today. The world is a better place because of that merger, not a worse one.”
Live Nation president/CFO Joe Berchtold also discussed the then pending lawsuit during the company’s Q1 earnings call earlier this month.
“Based on the issues we know about, we don’t believe a breakup of Live Nation and Ticketmaster would be a legally permissible remedy,” he said. “Live Nation and Ticketmaster came together lawfully through a merger that the DOJ reviewed and approved subject to divestitures and other remedies. The DOJ has repeatedly stated in court filings that the merger and settlement were in the public interest.”
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Live Nation talks DoJ, all-in pricing, festivals
Live Nation president and CFO Joe Berchtold has spoken out on a range of issues including the company’s all-in pricing success and the US Department of Justice’s (DoJ) investigation into the firm.
Speaking yesterday (21 May) at JP Morgan’s 52nd annual global technology, media and communications conference, Berchtold responded to LN’s disclosure that its all-in ticket pricing policy, which shows customers the total price and fees associated with their tickets upfront, has resulted in an 8% increase in completed sales in its first six months.
“We were pleasantly surprised,” said Berchtold. “That showed that fans not being surprised by an add-on price down the road meant that they were more likely to buy.
“I think it’s the right first step for us. I think it’s the right step for the industry. If you take a step back in the conversation over the past year and a half about ticketing – particularly on the legislative side – it went from us being the demons, the root of all evils in the industry, to a lot of education. And the conversations today on the legislative side tend to be very different; they tend to be very focused on what are reasonable consumer protections.”
Last week, the US House of Representatives voted to pass the TICKET Act, which aims to ensure transparent pricing for consumers and was the most comprehensive consumer protection ticketing legislation to receive a floor vote in eight years. Live Nation was among a number of companies in the US that pledged to adopt “all-in” ticket pricing last summer.
“I’m hopeful that we’re now on a path, all-in ticketing being the first step, of some pretty common sense reforms in ticketing”
“I’m hopeful that we’re now on a path, all-in ticketing being the first step, of some pretty common sense reforms in ticketing that will be good for the fans and will be good for the artists,” added Berchtold.
Following a Wall Street Journal report that the DoJ is expected to file an antitrust lawsuit against LN in the coming weeks, Berchtold revealed that talks were ongoing with the department at a senior level.
“We’re now in discussions with the senior division leadership, which is generally the last part of the process,” he said. “These are always serious discussions, it wouldn’t get to this point if they didn’t have concerns, but the good news is we’re still talking and they’ve said they have an open mind.
“Without getting into the real details of the conversation… I continue to believe that we fundamentally have business practices that are fully defensible. But we’re also open to figuring out common ground in order to get this settled and moved on. What we don’t know is exactly what they want at this point still. If you look at the Apple case, from my view, you have some similarities that it seems to be some discrete business issues where they ultimately decided they wanted to take action against the broader platform as opposed to sorting the specific issues.
“As I said, we’re continuing the conversations and we’ll keep showing up and continue them as long as they are interested in doing so. But I think we’re getting to the late stages now of it.”
“It’s a very competitive market… It doesn’t get easier, it gets harder”
According to WSJ sources, the lawsuit will claim the Ticketmaster parent has abused its market-leading position in the ticketing business to harm competition. But Berchtold played down suggestions that exclusivity deals would be a particular focus.
“It’s a bit of a red herring,” he said. “If you’re a venue, you’re saying, ‘Wait a minute, why is somebody telling me I need to work with multiple systems?’ We just find that that’s not generally what the venues are asking for… At the highest level, what they care about are two things. One is, is the platform going to sell the most tickets for me? And then secondly is, just what are the financial terms of the deal?
“I think if you stopped a manager on the street and said, ‘What building [do] you want your artists to go into?’ They’ll say, ‘Well, what’s going to sell the most tickets and gross the most money for my artist?’ So if you’re a venue in a competitive world, trying to get those shows, that’s what’s going to ultimately really matter to your decision.
“It’s a very competitive market. Don’t let any of the press reports fool you. Every renewal that we have, it’s what you expect in today’s world. It doesn’t get easier, it gets harder.”
Below, are a few other highlights from the conversation with Berchtold…
“You’ll continue to see us very active, particularly on the venue front in South America, Europe, Asia”
2024 ticket sales…
“It continues to be a very strong year. I think as of now we’d be at about 100 million concert tickets sold, up a couple of percent, so it’s accelerated a little bit. As we’ve long said, stadiums are quieter this year, but arenas, amphitheatres, theatres and clubs, ticket sales are up double digits across all of those different venue types. So continuing, they think this is going to be a very good year in particular for shows at our own venues.
“On the Ticketmaster side, we’ve sold about 140 million tickets, so up around 5%. So [consumer demand] continues to be very strong. We’re feeling very good about where we are as we head into the summer season.”
M&A strategy…
“You’ll continue to see us very active, particularly on the venue front in South America, Europe, Asia, all over as we continue to try to build that. I think you’ll still see some promoter acquisitions, again, with South America, Asia as the primary targets as we further expand our footprint in those markets. So no slowdown in appetite or discussions.”
Festivals…
“We’ve got some creative people that have come up with some great festival ideas… The best example is When We Were Young, which we launched in Vegas a year and a half or so ago. It’s pop-punk. I remember when the lineup came out, if you looked at [social media], it was, ‘This has got to be fake. There’s no way they can have this group of acts in one day. This is a Fyre Festival. It’s not going to happen.’ But so then what happened is it was set up as a one-day festival, but we did it five days. So we repeated it five times because there was so much demand for it.
“I think it’s complementary with the Lollapaloozas of the world, Austin City Limits, BottleRock, See.Hear.Now. You’re still seeing a lot of these do well, but you’ve got this… emergence of these new festival types. It’s taking a minute to figure out how to work with sponsors on something that, rather than being a three-day event, is many one-day events with a new audience generally each day. So I always look at it as glass half full: that means more opportunity as we figure that out. That’s another area of growth that we have.”
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DoJ ‘to file antitrust suit against Live Nation’
The US Department of Justice (DoJ) is expected to file an antitrust lawsuit against Live Nation in the coming weeks, according to the Wall Street Journal.
Citing anonymous sources, the WSJ reports that the suit – which could be filed as soon as next month – would claim the Ticketmaster parent has abused its market-leading position in the ticketing business to harm competition, although specific details of the lawsuit have not been confirmed.
In response to the report, a Ticketmaster spokesperson tells the publication: “Ticketmaster has more competition today than it has ever had, and the deal terms with venues show it has nothing close to monopoly power.”
Neither Live Nation or the DoJ have commented. However, LN president/CFO Joe Berchtold addressed the DoJ’s investigation in a recent interview at the Morgan Stanley’s Technology, Media & Telecom Conference in San Francisco.
“We’re fully giving them everything they asked for and they’ll define the timetable,” he said. “Meanwhile, we’ll continue to run a great business. Again, I’ll say it over and over, our strategy, our culture, is to super-serve the artists. I don’t think we have anything to be ashamed of with having that as a strategy.
“I think that our structural behaviour is positive for the industry. Big is bad today, but I feel very good about how we are as a company trying to operate what we’re trying to do and what our opportunities are going forward.”
“The Ticketmaster of 2010 did not face the level of competition that we face today”
Speaking during the promoter’s earnings call in February, CEO Michael Rapino said Live Nation was “100% cooperative” with investigators following reports that the US Justice Department had sent out a new raft of information requests in connection with the probe.
Four years ago, a US district court issued a judgment extending the ‘consent decree’ governing the 2010 merger of Live Nation and Ticketmaster to 2025. The DoJ alleged the firm had violated provisions of the decree on multiple occasions – claims that were strenuously denied by Live Nation.
Berchtold also defended Ticketmaster’s practices when appearing before a US Senate antitrust panel in early 2023, spurred by the fallout from the presale for Taylor Swift’s stadium tour.
“We hear people say that ticketing markets are less competitive today than they were at the time of the Live Nation-Ticketmaster merger. That’s simply not true,” he argued. “The Ticketmaster of 2010 did not face the level of competition that we face today… Ticketmaster has lost, not gained, market share since the merger.”
While the company has come under increased scrutiny from lawmakers since the 2022 Eras Tour onsale, it is understood the DoJ inquiry predates the controversy.
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Live Nation-Ticketmaster consent decree extended
The US district court for the District of Columbia (Washington DC) has issued a judgment extending the ‘consent decree’ governing the 2010 merger of Live Nation and Ticketmaster for a further five and a half years.
Live Nation reached a settlement extending the decree with the United States Department of Justice (DOJ) in December, following a DOJ investigation into alleged anti-competitive business practices.
The DOJ alleges Live Nation has violated provisions of the decree – which, among other things, requires Ticketmaster to license its ticketing software to competitors – on multiple occasions over the past decade. The claims are strenuously denied by Live Nation, which says the North American ticketing market is more competitive now than ever.
As a result of the court judgment, Live Nation will pay the DOJ’s costs, as well as fees for monitoring and enforcement of the decree through 2025.
“We strongly disagree with the DOJ’s allegations in the filing and the conclusions they seek to draw”
Makan Delrahim, assistant attorney-general in the DOJ’s antitrust (competition) division, says: “The amended decree reimburses the American people millions of dollars and makes it easier for the antitrust division and state enforcers to identify and prosecute future transgressions.”
“Live Nation settled this matter to make clear that it has no interest in threatening or retaliating against venues that consider or choose other ticketing companies,” said a Live Nation spokesperson in a statement issued on 9 January.
“We strongly disagree with the DOJ’s allegations in the filing and the conclusions they seek to draw from six isolated episodes among some 5,000 ticketing deals negotiated during the life of the consent decree. [In a court filing earlier this month, DOJ lawyers submitted evidence they allege shows instances in which six venues were told Live Nation would stop booking acts there if they used a ticketing company other than Ticketmaster.]
“Nevertheless, in keeping with our decision to settle, our focus is now on bringing this matter to its conclusion and continuing to deliver the best live event experiences to fans everywhere.”
Photo: Phyzome/Wikimedia Commons (CC BY-SA 3.0)
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Live Nation shares up 10% post DOJ settlement
Live Nation’s share price rose by US$6.79 to $70.60 yesterday (Thursday 19 December) following news that it had reached a settlement with the US Department of Justice (DOJ) over antitrust allegations.
The DOJ had opened investigations into Live Nation last Friday over concerns that the company had violated the terms of a decree governing its 2010 merger with Ticketmaster.
Both Live Nation and Ticketmaster refuted all allegations of anti-competitive practice.
As part of the settlement, the DOJ is extending and modifying the decree that permits the merger, and which was set to expire next year, until 2025. The justice department calls the agreement the “most significant enforcement action of an antitrust decree in 20 years”.
Following the news, Live Nation’s stock, which had dropped to around $64 per share following news of the DOJ investigation, rebounded to the levels it had been trading at before, jumping almost 10% to just over $70. Shares remained up at $69.83 at the time of writing.
“We believe this is the best outcome for our business, clients and shareholders as we turn our focus to 2020 initiatives”
“We have reached an agreement in principle with the Department of Justice to extend and clarify the consent decree,” comments a Live Nation spokesperson. “We believe this is the best outcome for our business, clients and shareholders as we turn our focus to 2020 initiatives.”
Under the terms of the modified agreement, Live Nation is prohibited from pressuring venues to use Ticketmaster and from withholding shows from a venue if it chooses to go with another ticketer. An independent party will monitor Live Nation’s compliance with the decree, and a $1 million fine will be levied for any violation of the agreement.
“When Live Nation and Ticketmaster merged in 2010, the Department of Justice and the federal court imposed conditions on the company in order to preserve and promote ticketing competition,” says assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.
“Today’s enforcement action including the addition of language on retaliation and conditioning will ensure that American consumers get the benefit of the bargain that the United States and Live Nation agreed to in 2010. Merging parties will be held to their promises and the Department will not tolerate transgressions that hurt the American consumer.”
The full DOJ statement can be read here.
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