Senators target Ticketmaster after Taylor Swift fiasco

Senators grilled Ticketmaster on Tuesday, questioning whether the company’s dominance of the ticketing industry led to its spectacular collapse at a Taylor Swift concert ticket sale last year.

Republicans and Democrats on the Senate Judiciary Committee also discussed possible measures, including making tickets non-transferable to reduce scalping and calling for more transparency on ticket fees. Some suggested it might also be necessary to separate Ticketmaster and Beverly Hills, California-based concert promoter Live Nation, which merged in 2010.

“The fact is, Live Nation/Ticketmaster is the 800-pound gorilla here,” said US Senator Richard Blumenthal, a Connecticut Democrat. “This whole concert ticket system is a mess, a monopolistic mess.”

Ticketmaster is the world’s largest ticket seller, processing 500 million tickets each year in more than 30 countries. About 70% of tickets to major concert halls in the US are sold through Ticketmaster, according to data in a federal lawsuit filed by consumers last year.

In mid-November, Ticketmaster’s website crashed during a presale event for Swift’s upcoming stadium tour. The company said its website has been overwhelmed by both fans and attacks by bots posing as consumers to scavenge tickets and sell them on secondary websites. Thousands of people lost tickets after hours of waiting in an online queue.

Live Nation President and Chief Financial Officer Joe Berchtold apologized to fans and Swift on Tuesday, saying the company knew it had to do better. Berchtold said Ticketmaster has spent $1 billion over the past decade to improve its security and stop bots.

“We have to get better and we will do better,” he said.

But lawmakers were skeptical. Republican Senator Marsha Blackburn of Tennessee said many others, including banks and energy companies, are also common targets of bots but are not experiencing service crashes.

“You figured it out, but you guys haven’t? It’s incredible,” she said. “We have a lot of people who are very unhappy with the way this has been addressed.”

Senators also targeted Ticketmaster’s fees. US Senator Amy Klobuchar, a Minnesota Democrat, recalled crashing into a friend’s car in high school while going to Led Zeppelin, The Cars and Aerosmith concerts. Nowadays, ticket prices have gotten so high that shows are too expensive for many fans. Klobuchar said ticket fees now average 27% of ticket costs and can rise to as much as 75%.

Berchtold insisted that Ticketmaster does not set ticket prices or service fees, or decide how many tickets go on sale. Service fees are set by venues, he said. Live Nation only owns about 5% of venues in the US, he said.

But competitors, such as Seat Geek CEO Jack Groetzinger, said even if Live Nation doesn’t own a venue, it stifles competition by signing multi-year deals with arenas and concert halls to provide ticketing services. If these venues do not consent to the use of Ticketmaster, Live Nation may withhold performances. This makes it difficult for competitors to disrupt the market.

“The only way to restore competition is to break Ticketmaster and Live Nation apart,” Groetzinger said.

Clyde Lawrence, a singer-songwriter for the New York-based pop group Lawrence, said it also hurts artists when Live Nation owns venues or has deals with venues because bands have little opportunity to negotiate a deal or select another ticket seller.

Lawrence shared a hypothetical example: Ticketmaster charges $30 per ticket, but then adds fees that bring the price up to $42. Just $12 per ticket goes to the band after accounting for fees they have to pay to Live Nation, including – in at least one instance – $250 for a stack of 10 towels in the dressing room.

Lawrence wants caps on fees, more transparency in how event fees are used, and fairer distribution of profits. For example, Live Nation takes a cut of the band’s merchandise sales at a concert, but not the food and drink sales.

Berchtold said the ticketing industry wants lawmakers to focus on the problem of ticket scalping – which he says has grown into a massive $5 billion industry – and outlaw fraudulent practices such as B. Resellers who offer tickets that have not yet officially gone on sale. He also agreed that the industry should be more transparent about fees.

Senator John Kennedy, a Republican from Louisiana, proposed legislation that would make tickets non-transferable, preventing resale. He also suggested that big artists like Swift or Bruce Springsteen should demand caps on fees.

“Not every kid can afford $500 to see Taylor Swift,” Kennedy said.

Berchtold said Ticketmaster would support making tickets non-transferrable, although the company operates in the ticket resale market. But others, including Republican Senator Thom Tillis of North Carolina, said making tickets non-transferable would affect people’s right to resell them.

The Justice Department allowed Live Nation and Ticketmaster to merge in 2010, so long as Live Nation agreed not to retaliate against concert venues for ten years for using other ticketing companies.

In 2019, the department investigated and found that Live Nation had “repeatedly” violated that agreement. It extended the ban on retaliation against concert venues until 2025.

Senator Mike Lee, a Utah Republican, said Tuesday that the Justice Department is investigating Live Nation again following the Swift ticket fiasco. At that point, he said, Congress should ask whether the department had the right to allow the merger in the first place.

“It is very important that we maintain fair, free, open and even tough competition,” Lee said. “That increases the quality and lowers the price. We want these things to happen.”