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Live Nation’s CFO is grilled at the Senate hearing, but analysts don’t expect the ticketing industry to be rocked

By Viktor Reklaitis

Ticketmaster’s parent company top executive heads to Washington for Taylor Swift tour after recent botched sale

A top executive at Live Nation Entertainment Inc. faces difficult questions Tuesday as he appears with other witnesses before a Democratic Party-led Senate committee investigating the ticketing industry.

The Senate Judiciary Committee is scheduled to hold a hearing entitled “That’s the Ticket: Promoting Competition and Protecting Consumers in Live Entertainment” Tuesday at 10 a.m. Eastern.

The hearing on Capitol Hill comes after Live Nation’s Ticketmaster unit botched November’s Taylor Swift ticket sales. The singer-songwriter herself later said it was “agonizing” to “just watch mistakes happen without recourse.”

The witnesses scheduled to testify at the hearing are Live Nation’s (LYV) Chief Financial Officer and President Joe Berchtold; Jack Groetzinger, CEO of ticket platform SeatGeek; Jerry Mickelson, CEO of concert promoter JAM Productions; Sal Nuzzo, senior vice president at the James Madison Institute, a right-wing think tank; Kathleen Bradish, vice president of legal advocacy at the American Antitrust Institute, a left-leaning think tank; and Clyde Lawrence, singer-songwriter for the band Lawrence.

Democratic Sen. Amy Klobuchar of Minnesota, chair of the Senate Antitrust Committee, said in a joint statement with fellow lawmakers last week that the hearing “will examine how consolidation in the live entertainment and ticketing industries is hurting customers and artists alike.” “.

“The troubles in the American ticketing industry were made painfully clear when Ticketmaster’s website failed hundreds of thousands of fans hoping to purchase tickets for Taylor Swift’s new tour, but these troubles are not new,” Klobuchar also said. “For far too long, consumers have faced high fees, long wait times and website outages, and Ticketmaster’s dominant market position means the company faces insufficient pressure to innovate and improve.”

Ticketmaster is estimated to control more than 70% of the ticketing and live events market.

Antitrust Committee chief Republican Sen. Mike Lee of Utah said he looks forward to “exercising our subcommittee’s oversight authority to ensure that anticompetitive mergers and foreclosure behavior in an entertainment industry already struggling to recover from pandemic lockdowns don’t paralyze”.

According to analysts at Height Capital Markets, investors shouldn’t expect any major changes in the ticketing industry as a result of Tuesday’s hearing.

“In our view, while it is possible that legislation will emerge from the hearing, passing the bill would be an uphill battle given the current divisions between the chambers of Congress,” Height research director Benjamin Salisbury said in a note dated Monday .

Republicans took control of the House this month after victories in November’s midterm elections, leading analysts to expect a deadlock in Washington on many issues as Democrats still have a tight grip on the Senate and White House.

Salisbury says it’s more likely the Justice Department could take action and aim to further extend a key consent decree.

This decree prevents Live Nation from forcing venues looking to book their tours to use Ticketmaster and from retaliating when venues use a competitor. It was closed in 2010 to allow Live Nation to merge with Ticketmaster and was scheduled to expire in 2020 but was extended to 2025 as part of a settlement.

“The more likely outcome is that the hearing reinforces demands by Congress members after the DOJ to either (a) extend the terms of the current Live Nation/Ticketmaster Consent Decree beyond 2025 or (b) proceed with the dissolution of the companies. However, breaking up companies is an extremely rare process,” the Height analyst said.

Ticketmaster has defended the state of its industry.

“The market is nonetheless increasingly competitive, with competitors making aggressive offers to venues,” Live Nation’s entity said in a statement in November. “Ticketmaster’s continued leadership in such an environment is a testament to the platform and those who operate it, not anti-competitive business practices.”

-Victor Reklaitis

 

(ENDS) Dow Jones Newswires

1/23/23 1636ET

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