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In its lawsuit accusing Live Nation Entertainment, the live performance behemoth that owns Ticketmaster, of being an unlawful monopoly, the Justice Department drew on a raft of inside communications that provided a uncommon behind-the-scenes have a look at the business.
The Justice Department argued in an intensive criticism filed on Thursday that the merger of Live Nation and Ticketmaster, which went by way of in 2010, had damage competitors, hindered innovation and resulted in greater ticket costs and charges for shoppers. It referred to as for the corporate to be damaged up.
In response, Live Nation, which can be the world’s largest live performance promoter, has stated that it isn’t a monopoly, and denied that it has the unilateral energy to lift costs. Contrary to the federal government’s argument about its nice energy, Live Nation says it now faces extra competitors than ever, and that the Justice Department’s go well with “received’t scale back ticket costs or service charges.”
Detailing its allegations, the federal government relied on eye-opening emails that it says had been written by Live Nation’s chief govt, Michael Rapino, and different high-powered figures within the live performance world.
Here are a number of of these accusations.
A possible rival’s Kanye West live performance
One episode from 2021 goes to the center of the Justice Department’s allegations that Live Nation went to excessive lengths to guard its aggressive edge.
Late that 12 months, the federal government says, Live Nation “threatened business retaliation” in opposition to the personal fairness agency Silver Lake, which had an funding in TEG, an Australian ticketing and promotions firm that was concerned in a extremely anticipated profit present by Kanye West and Drake on the L.A. Coliseum. Silver Lake had additionally invested in Oak View Group, a venue administration firm with shut ties to Live Nation.
According to the federal government, Rapino complained to an Oak View Group govt that he seen TEG as a competitor, and Oak View Group relayed to the investor that Live Nation was “not joyful.” Rapino then instructed Silver Lake he was “all in” with Oak View Group, “the place the large play lies with venues — why insult me with this funding in ticketing/promotions and so on.”
TEG had organized a deal to promote some tickets by way of StubHub. According to the criticism, Live Nation sought to “frustrate” TEG by blocking these tickets, and consequently “a whole lot of StubHub’s clients had been refused entry to the occasion.”
Live Nation then “threatened to tug its assist from Oak View Group,” and Irving Azoff, the highly effective artist manager who was a co-founder of Oak View Group, refused to permit TEG to advertise exhibits with any of the artists he managed. Azoff instructed Rapino he would demand that Silver Lake promote TEG, and Rapino replied, “Love ya.” According to the criticism, Silver Lake sought to promote TEG — and provided it to Live Nation.
In an in depth response to the Justice Department’s lawsuit, Dan Wall, Live Nation’s govt vice chairman of company and regulatory affairs, stated the declare that Live Nation had threatened Silver Lake “reveals not solely a disregard for the details, but in addition deep hypocrisy.”
Rapino’s criticism, Wall stated, was “essentially the identical” as a priority by each the Justice Department and the Federal Trade Commission over “personal fairness firms making a number of investments in the identical business due to aggressive ‘entanglements.’”
In a separate assertion in regards to the live performance on the L.A. Coliseum, Live Nation stated: “The solely factor that we did was frustrate TEG’s efforts to place tickets straight on the secondary market in violation of our unique rights over major tickets.” Silver Lake didn’t reply to a request for remark.
A competitor turned ‘hammer’
Live Nation, the federal government says, initially seen Oak View Group as certainly one of its “Biggest Competitor Threats.” But quickly the businesses “colluded,” the federal government says, to “keep away from competing with one another, and chart a mutually helpful marketing strategy to cement Live Nation’s dominance.”
Oak View Group, the federal government says, operated as an “agent” for Live Nation, even calling itself a “pimp” and a “hammer” for the bigger firm, generally delivering threats on behalf of Live Nation to venues that had been contemplating dropping Ticketmaster for an additional ticket supplier.
The authorities’s criticism quotes from what it says are emails from 2016 through which Rapino complains to Oak View Group executives about their intention to advertise exhibits with an artist that Live Nation works with. Oak View Group backs down, with the corporate’s chief govt — who isn’t recognized within the criticism, however is Timothy Leiweke — saying: “Our guys bought a bit forward. All know we don’t promote and we solely do excursions with Live Nation.”
Wall, the Live Nation govt, stated in response that Oak View Group “has by no means been a live performance promoter, nor aspired to be one,” and that it was merely trying to fill the occasional darkish night time at certainly one of its venues. “To painting that as an settlement to not compete in live performance promotion is farcical,” Wall wrote. A consultant of Oak View Group declined to remark.
A ticketing rival at Barclays Center
In early 2023, The New York Times broke the information that Barclays Center, the sector in Brooklyn, was dropping SeatGeek, the younger and aggressive ticketing enterprise it had simply entered a seven-year contract with, and signing a brand new take care of Ticketmaster.
The abrupt change raised eyebrows within the business, and led to questions on whether or not Live Nation had denied the venue entry to Live Nation’s largest excursions as retaliation for switching from Ticketmaster to SeatGeek. Live Nation denied that on the time, and a assessment of live performance knowledge by The Times was inconclusive. The variety of Live Nation-promoted exhibits at Barclays had certainly fallen since SeatGeek took over, however so had these by impartial promoters.
The Justice Department’s case omits Barclays’ identify from the go well with, however Wall confirmed it in a convention name with buyers late Thursday. The authorities quotes from an e-mail that it says was despatched to the venue’s chief govt from “a senior Live Nation govt” who had heard the venue was switching to SeatGeek: “Anyways,” the e-mail says, “ought to take into consideration greater relationship with LN not simply who’s writing an even bigger sponsorship test,” including a “wink” emoji.
According to the federal government, Live Nation “adopted by way of on its threats, re-routing concert events to different venues.”
In response, Live Nation stated, “We categorically deny that any concert events had been rerouted to retaliate in opposition to their determination to go to SeatGeek.”
Buying rival firms
The authorities argues that Live Nation has acquired plenty of firms with an goal to remove rivals in each live performance promotion and ticketing.
Among the examples the federal government cites are United Concerts in Utah, which used a regional ticketing firm referred to as SmithsTix. According to the what the federal government says had been inside communications at Live Nation, the corporate needed a better ticketing foothold in Utah however selected to not purchase SmithsTix as a result of doing so would “require us to go to the DOJ.” Instead, Live Nation purchased United Concerts in 2017 and transformed its venues to Ticketmaster; SmithsTix, it stated, in the end went out of enterprise.
Another is AC Entertainment in Tennessee, which had performed an element within the Bonnaroo pageant there. Live Nation took a controlling stake within the firm in 2016. A Live Nation govt seen the economics of the deal as “not tremendous thrilling,” however referred to as it “a defensive transfer” in opposition to AEG, in response to the criticism. In 2018, Live Nation purchased Frank Productions, a promoter in Wisconsin that used ticketers apart from Ticketmaster; Live Nation acquired the corporate and “flipped the venues to unique Ticketmaster contracts.”
In response, Wall stated the deal for AC Entertainment was made with a promoter who was in his 60s and needed to retire. “Live Nation didn’t have a Knoxville workplace, so for $15 million it made the deal,” Wall wrote. “Seriously? The DOJ is difficult that?”
