Karma is a Relaxing Thought, But Not for Ticketmaster

by Micah Kindred, Associate Member, University of Cincinnati Law Review Vol. 91

I. Introduction

Taylor Swift’s success in the music industry is only rivaled by that of The Beatles, Whitney Houston, David Bowie, and other iconic artists.1Top Artists, ChartMasters (Nov. 21, 2022), https://chartmasters.org/best-selling-artists-of-all-time. As such, when Taylor Swift announced her first tour in five years, the world took notice.2Gabriella Borter, Taylor Swift Announces First U.S. Stadium Tour in Five Years, Reuters (Nov. 2, 2022), https://www.reuters.com/lifestyle/taylor-swift-announces-first-us-stadium-tour-five-years-2022-11-01. However, when Ticketmaster’s pre-sale began for the tour, everything seemed to fall apart.3Jay Peters, Ticketmaster Cancels Its Public Sale of Taylor Swift’s Eras Tour Tickets, The Verge (Nov. 17, 2022), https://www.theverge.com/2022/11/17/23464939/ticketmaster-taylor-swift-eras-tour-public-sale-canceled. Now Ticketmaster is facing incredible backlash, including an investigation by the Justice Department, a Congressional hearing, and a class action lawsuit.4Karli Bendlin, Taylor Swift’s Eras Tour: A Timeline of the Ticketmaster Fiasco, PeopleMag (Jan. 25, 2023), https://people.com/music/taylor-swift-eras-tour-ticketmaster-timeline. Part II will provide background on the Taylor Swift Eras Tour Pre-sale. Part III will discuss the anti-trust allegations Ticketmaster is facing. Part IV concludes with the potential outcomes of these allegations.

II. Background

Eras Tour tickets were first offered for sale during Ticketmaster’s “Verified Fan Pre-Sale” on November 15, 2022.5Id.  This sale was set to give 1.5 million “verified fans” a chance to purchase tickets.6Id. Soon after the sale began, fans took to social media to sound their complaints, which included extreme wait times, technical glitches, site crashes, and more.7Id.

The day after the pre-sale ended, Ticketmaster announced that the general ticket sale was cancelled.8Id. For Taylor Swift fans that had not gotten tickets during the pre-sales, this was devastating.9Gil Kaufman, Taylor Swift Fans Share Struggle to Score ‘Eras’ Tickets: ‘Proof that the ‘Hunger Games’ Could Actually Happen’, Billboard (Nov. 15, 2022), https://www.billboard.com/music/pop/taylor-swift-fans-frustration-eras-tour-verified-presale-1235171374/. The cancellation of the general sale meant there were not going to be any more opportunities to buy tickets, and only those who were lucky enough to buy tickets during the chaos of the pre-sale or the Capital One pre-sale would get to attend the Eras Tour.10Daniel Kreps, Ticketmaster Adds to the Chaos, Cancels General On-Sale for Taylor Swift’s Eras Tour, Rolling Stone (Nov. 17, 2022), https://www.rollingstone.com/music/music-news/ticketmaster-cancels-general-on-sale-taylor-swift-the-eras-tour-1234632678. Earlier that morning, Greg Maffei, the CEO of Ticketmaster’s parent company, spoke out about the pre-sale fiasco claiming that the “massive demand” for Eras Tour tickets caused all the issues fans experienced.11Id. Maffei claimed Ticketmaster was prepared to host 1.5 million “verified fans” during the pre-sale; however, the site was bombarded with over fourteen million people.12Id.

The pre-sale was so disappointing that Taylor Swift even spoke out about it directly, albeit a few days after the sale.13Id. Swift took to Instagram to express her frustrations: “It’s really difficult for me to trust an outside entity with these relationships and loyalties, and excruciating for me to just watch mistakes happen with no recourse.”14Id. The singer also mentioned that her team asked Ticketmaster “multiple times” if they could handle the level of demand that was to come with The Eras Tour and that Ticketmaster assured her they could.15Id. Seemingly in response to Swift’s statement, Ticketmaster released an apology blaming bot attacks for the website’s failure.16Id.

III. Discussion

Following Swift and Ticketmaster’s remarks, the New York Times reported that the Department of Justice (“DOJ”) relaunched an investigation into Ticketmaster’s parent company, Live Nation Entertainment.17Id. This investigation is focused on the 2010 merger of Ticketmaster, a major ticket sales company at the time, and Live Nation, a large events promoter and venue operator.18Juliana Kaplan, Why the Taylor Swift Debacle Could Lead to Renewed Scrutiny of the Ticketmaster/Live Nation Merger, Bus. Insider (Dec. 22, 2022), https://www.businessinsider.com/taylor-swift-doj-investigation-of-ticketmaster-live-nation-merger-2022-12; Emily Lorsch, Why Live Nation and Ticketmaster Dominate the Live Entertainment Industry, CNBC (Jan. 25, 2023), https://www.cnbc.com/2023/01/25/the-live-nation-and-ticketmaster-monopoly-of-live-entertainment.html. Since the merger, Live Nation controls “an estimated 70% of the ticketing and live event venues market.”19Lorsch, supra note 18. The Eras Tour debacle has only exacerbated the potential anti-trust issues that the Ticketmaster and Live Nation merger created.

Beyond the DOJ investigation, Live Nation Entertainment also faced a Senate hearing on January 24, 2023.20Rachel Treisman, The Senate’s Ticketmaster Hearing Featured Plenty of Taylor Swift Puns and Protesters, NPR (Jan. 24, 2023), https://www.npr.org/2023/01/24/1150942804/taylor-swift-ticketmaster-senate-hearing-live-nation. This hearing focused on the lack of competition in the ticketing industry, which may have stemmed from Ticketmaster’s merger with Live Nation.21Id. One of the significant witnesses in this hearing was the CEO of SeatGeek, Inc., Jack Groetzinger.22Id. SeatGeek is arguably one of Ticketmaster’s largest competitors.23Top Ten Ticketmaster.com Competitors, Similarweb, https://www.similarweb.com/website/ticketmaster.com/competitors (last visited Mar. 19, 2023). During the hearing, Groetzinger stated that “major U.S. venues know that if they move their primary ticketing business away from Ticketmaster, they risk losing the revenue they earn from Live Nation concerts.”24Treisman, supra note 20. Groetzinger also alleged that there had been retaliation against venues in the past for doing just that.25Id.

Kathleen Bradish, an anti-trust expert and vice president for legal advocacy at the American Antitrust Institute, spoke during the hearing as well.26Id. Bradish told the committee “Live Nation-Ticketmaster is an example of, on one hand, a very traditional monopoly in the mode of Standard Oil, on the other a 21st century digital player, like other online platforms, dominating an ever-widening swath of its industry.”27Id. Bradish added that the Department of Justice found that Live Nation Entertainment violated some of the requirements governing the merger between it and Ticketmaster.28Id. Despite these violations, the DOJ only extended the requirements for an additional five and a half years.29Id.

Interestingly, the DOJ and the Senate are not the only parties taking action in response to the Eras Tour sale. Fans themselves are suing Live Nation Entertainment in a class-action lawsuit in California.30Peter Cohan, Swifties’ Suit Seeks $2,500 per Ticketmaster Antitrust Violation, Forbes (Dec. 7, 2022, 10:11 AM), https://www.forbes.com/sites/petercohan/2022/12/06/swifties-suit-seeks-2500-per-ticketmaster-antitrust-violation/. The suit was brought by twenty-six fans who tried and failed to get tickets to the Eras Tour.31Id. The complaint “alleges that anti-competitive behavior by Live Nation caused harm to concertgoers and the ticketing industry, according to the New York Times.”32Id.

The actions from the DOJ, the Senate, and the fans demonstrate the seriousness of these anti-trust allegations against Live Nation. The Senate’s hearing may put pressure on the DOJ to put more restrictions in place on Live Nation since the hearing was public and the Eras Tour caused such a stir. Beyond that, the fan-lead lawsuit could prove to be disastrous for Live Nation. If the fans prevail in this suit, Live Nation is looking at damages potentially totaling $29 billion.33Id. As of February 6, 2023, Live Nation as a company is worth $17.25 billion, so a lawsuit of this size could bankrupt the company.34Live Nation Entertainment Net Worth 2010-2022 | LYV, Macrotrends, https://www.macrotrends.net/stocks/charts/LYV/live-nation-entertainment/net-worth (last visited Mar. 19, 2023).

Since the Eras Tour pre-sale, anti-trust law has come to the forefront of the news, specifically regarding the Ticketmaster and Live Nation merger. The attention on anti-trust law could lead to more anti-trust investigations opening up or more mergers being rejected on the basis of anti-trust violations. So, major companies looking at significant mergers may want to be more cautious as they enter into those deals in the next few years.

IV. Conclusion

With three different groups seeking answers as to what happened with the Eras Tour ticket sale and how much blame should go to Live Nation and Ticketmaster, one thing is for certain: fans want answers, and so do the Senate and the DOJ. Over the next year or so, Live Nation may be hit with additional restrictions from the DOJ because of their failures with the Eras Tour pre-sale. Beyond that, the Senate may look into passing additional legislation on ticket sales that could impact how Ticketmaster does business. However, the lawsuit from the fans is likely the most pressing issue Live Nation is facing, because, although unlikely, losing could result in significant losses for the company. Regardless of what happens though, as Senator Richard Blumenthal said: “Ticketmaster ought to look in the mirror and say, ‘I’m the problem. It’s me.’”35María Luisa Paul & Daniel Wu, They Quoted Taylor Swift in a Senate Hearing – But Who’s the Top Swiftie?, Wash. Post (Jan. 27, 2023), https://www.washingtonpost.com/nation/2023/01/27/senators-taylor-swift-lyrics-ticketmaster-hearing.

Cover Photo by Raphael Lovaski on Unsplash

Author

  • Micah Kindred graduated from the University of Louisville in 2021 with a degree in Computer Science and Engineering with a minor in Business Management. Micah spent her undergraduate co-ops working in software development, enterprise architecture, and data science. Micah hopes to pursue a career in patent and corporate law after law school.

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