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US federal prosecutors are set to seek to break up Live Nation Entertainment in a lawsuit alleging that Ticketmaster’s dominance in ticketing violates antitrust law, according to a person familiar with the matter.
The Department of Justice alongside a group of states could file a case as early as Thursday, the person said. It will pursue remedies including splitting Live Nation Entertainment, which was created by the 2010 merger of Live Nation and Ticketmaster.
The company has had a long-standing legal stand-off with the DoJ, and it has faced growing pushback from fans, lawmakers, artists and competitors who accuse it of having too much power over the live entertainment industry.
The issue has drawn more attention in the past few years as prices have soared and musicians began touring again after a pandemic-induced hiatus. The average US concert ticket price rose to nearly $131 in 2023, up 23 per cent from the prior year, according to Pollstar.
The DoJ declined to comment. Live Nation did not immediately respond to a request for comment. The company’s shares dropped more than 6 per cent in after-hours trading.
The justice department in 2010 gave the green light to the merger of Ticketmaster and Live Nation subject to a 10-year settlement agreement that forced Ticketmaster to license a copy of its ticketing software to rival Anschutz Entertainment Group and divest ticketing assets. The DoJ also barred it from retaliating against venues that choose alternative ticketing or promotional services.
In 2019, the DoJ modified and extended the agreement, saying the group had “repeatedly” violated the initial deal. Prosecutors added new provisions including specifying that the retaliation ban would apply to venues that host “one or more” live events, not just “all Live Nation content”. But they also added that the group could bundle products and services “in any combination”.
The lawsuit would mark the DoJ’s latest antitrust broadside against corporate America. Jonathan Kanter, head of the department’s antitrust unit, has adopted a tougher enforcement stance in a bid to tackle anti-competitive conduct he argues has proliferated in recent decades due to lax policy.
On an earnings call earlier this month, Live Nation Entertainment’s chief financial officer Joe Berchtold said the DoJ’s investigation “appears to be focused on specific business practices, not the legality of Live Nation/Ticketmaster merger or our overall business structure”.
“Based on the issues we know about, we don’t believe a break-up of Live Nation and Ticketmaster would be a legally permissible remedy”, Berchtold added.
Frustration against Ticketmaster was exacerbated by its fiasco in 2022 during the sale of tickets for Taylor Swift’s Eras Tour, when buyers were left waiting for hours as its website was overwhelmed by massive demand. Ticketmaster cancelled a subsequent ticket sale due to “insufficient remaining ticket inventory”.
Lawmakers across parties railed against Ticketmaster after the Swift debacle, calling Live Nation Entertainment to testify before Congress shortly thereafter alongside artists and competitors.
Bloomberg first reported news of the lawsuit.
Robert Johnson is a UK-based business writer specializing in finance and entrepreneurship. With an eye for market trends and a keen interest in the corporate world, he offers readers valuable insights into business developments.
