Ticketmaster’s Taylor Swift disaster doesn’t require congressional hearings

Already in mid-November, pre-sale for mega pop star Taylor Swift’s “Eras” tour was opened. With 2 million tickets sold in one day and reduced demand due to a lack of tour dates from 2018, fans rushed to snap up tickets, crashing the Ticketmaster website.

Ticketmaster claims that it wasn’t just fans trying to grab tickets, but an unprecedented number of bots—most likely working on behalf of scalpers. Despite the website glitches, 2 million fans got tickets to Swift’s concerts—”the most tickets ever sold for a single artist in one day,” according to the company—and the general sale was subsequently canceled due to insufficient tickets. Based on website traffic, Ticketmaster (which merged with Live Nation back in 2010 to create Live Nation Entertainment) calculated that Swift should play more than 900 stadium concerts, or 20 times the number she actually performs, as would satisfy the extremely high demand.

Enter Amy Klobuchar.

On Tuesday, Joe Berchtold, chairman of Live Nation, was brought before the Senate Judiciary Committee to answer for Ticketmaster’s alleged misdeeds, which mostly involved his size more than anything.

“This is the very definition of a monopoly,” said Sen. Amy Klobuchar (D–Minn.).

Klobuchar was referring to a company that controls roughly 70 percent of the market and owns both a ticketing platform and many venues; Competitors such as Jerry Mickelson, an independent promoter, attested to the fact that “Live Nation can profit from concerts put on by rival promoters because it still makes money through its control of Ticketmaster,” according to The New York Times. “‘Pepsi doesn’t make money from Coca-Cola,’ he said. ‘But our competitor, Live Nation, makes money from selling tickets to our concerts.'”

This is how mergers work: Companies that used to do one thing or control a smaller market share join forces with others to grow. Acting as if Live Nation/Ticketmaster is immune to competitive pressures ignores how new entrants like SeatGeek have threatened its dominance, as well as how the government’s response to the COVID-19 pandemic has forced a nearly two-year hiatus on major events in many venues, which has become entrenched in his bottom line. Artists can refrain from using a company if they want to go through the extra work of securing a venue, promoting the show and selling tickets themselves.

Competitors “argued that Live Nation blocked rivals by securing long-term ticketing deals with major venues,” according to The Washington Post. “If arenas and other venues choose another ticket company, Live Nation won’t bring them popular acts, competitors argue.”

That would be a violation of the terms of the merger, but it’s unclear whether the threat is explicit enough to trigger legal action. (The Justice Department and the company have been engaged in a battle over this since 2019.) And of course, competitors want to take down the biggest company in the universe; SeatGeek CEO Jack Groetzinger advocated breaking up Ticketmaster and Live Nation as “the only way to restore competition in this industry.” Everyone works in their own interest.

Berchtold admitted that there were some legitimate problems with pre-sales. “Technical issues also caused tickets—which were approved by Ticketmaster through its Verified Fan system—to disappear from customers’ online shopping carts as they attempted to purchase them,” he noted. The New York Times. But companies sometimes have websites that crash, and the senators made it clear that the whole event isn’t really about fixing IT problems, but about breaking up what they see as a monopoly. Others called to testify also attacked the company’s size and power, arguing that the fees the company charges are too high and the artists earn too little.

Like many congressional hearings on big, successful companies, senators don’t seem to have a common understanding of what Ticketmaster did wrong. Instead, they goaded Ticketmaster over the glitches (a common problem that isn’t illegal and can be punished by market forces if it persists); for taking excessive profits (another thing that is not illegal); because it’s too big and successful (it’s also not illegal, although senators have threatened to try to undo the 2010 merger). And they did it in the most performative, farcical way possible, awkwardly reciting Swift lines clearly given to them by their teenage daughters (“She’s cheer captain and I’m on the bleachers,” Utah Republican Sen. Mike Lee said during one segment).

Artists and their management are free to do more work to organize their own tours if they want to earn more. But Ticketmaster/Live Nation provides a valuable service to artists, management and fans, even if website glitches sometimes lead to the terrible injustice of some Swifties being denied the tickets they’d like to buy. The Senate Judiciary Committee would be wise to remember that the companies currently at the top do not stay there forever and that we live in a time of extraordinary, unprecedented abundance when this one is a question that current senators are investigating.

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