AEG Presents Chairman and CEO Jay Marciano issued a strong statement regarding the ongoing Department of Justice (DOJ) lawsuit against Live Nation and its subsidiary Ticketmaster.
In a memo obtained by MBW on May 31, Marciano tagged Live Nation/Ticket Master Called it a “monopoly” and expressed confidence in the Justice Department’s ability to win the case.
“AEG has long maintained that Ticketmaster has a monopoly in the U.S. ticketing market and has used that monopoly power to subsidize Live Nation’s content business, prevent others from competing in these areas, and leave consumers to suffer the consequences,” Marciano wrote.
Marciano’s memo comes after Live Nation and Ticketmaster came under intense scrutiny. U.S. Department of Justice’Recent lawsuits allege anticompetitive behavior. Last week, after an 18-month investigation, the U.S. Department of Justice filed a civil antitrust lawsuit against Live Nation, accusing it of “monopoly and other illegal conduct that hinders market competition in the live entertainment industry.”
The DOJ lawsuit alleges that Live Nation and Ticketmaster’s dominance of the U.S. ticket market, combined with exclusive contracts and owned and operated venues, stifles competition and drives up ticket prices, affecting consumers and artists.
“Ticketmaster has a monopoly in the U.S. ticketing market and uses this monopoly power to subsidize Live Nation’s content business and prevent other companies from competing in these areas.”
Jay Marciano, presented by AEG
Marciano said the lawsuit was not just about breaking up the monopoly but also about saving “the entire ecosystem of our industry, which has been suffering from a severely damaged ticketing model for too long.”
The AEG boss added that Live Nation’s exclusive ticketing deal “frustrates competition and innovation, results in higher ticket prices, and takes away the ability of artists to choose who buys tickets for their shows and how much their fans should pay.”
Live Nation has repeatedly refuted accusations that it is a monopoly and has issued public statements blaming other industry players. Back in March, Live Nation wrote in a 2,800-word blog post that tickets were priced by artists and sports teams, not Live Nation itself.
“It’s their show and they get to decide the cost of admission. NFL tickets on Ticketmaster are priced by the home team, concert tickets are priced by the performer’s business team, Monster Jam tickets are priced by its producer (Feld Entertainment), etc. ,” Live Nation wrote.
Marciano responded that Live Nation was unfairly blaming others for the problems it caused in the industry.
“Artists, venues and agents are not responsible for this country’s broken live entertainment business model – the responsibility lies with Live Nation.”
“While it may take some time, we are confident that the Department of Justice’s lawsuit will be successful and ultimately lead to sweeping change.”
Jay Marciano, presented by AEG
“Despite what it claims about its profit margins or market share, it is a monopoly that uses its monopoly power to impose its will on the live entertainment business. Live Nation may claim that its promotional margins are low, but that’s only because it leverages ticketing The excess profits of the monopoly exceed the profitability of the concert market,” Marciano added.
Marciano’s memo also highlighted the broad support for the Justice Department’s case, noting that it reflects the views of 30 attorneys general, multiple media outlets, industry commentators, consumer groups and antitrust experts. He’s optimistic the Justice Department will win the case and that the lawsuit will lead to changes in the industry.
“While it may take some time, we are confident that the Department of Justice’s lawsuit will be successful and ultimately lead to sweeping change,” Marciano said.
While Marciano is confident the Justice Department will prevail in the legal battle, legal analysts say the Justice Department may have a hard time convincing the courts that splitting Live Nation/Ticketmaster would solve the problems it claims it did since the Justice Department approved it in 2010 After the merger, in 2019, the two parties reached another agreement regarding alleged monopolistic behavior.
You can read the full memo from AEG Present Chairman and CEO Jay Marciano below.
No doubt all of you are paying close attention to the ongoing media coverage following the Department of Justice’s lawsuit against Live Nation and Ticketmaster. As I mentioned in last week’s note, we spent the past few days carefully reviewing the DOJ filing, as well as Live Nation’s subsequent response to the complaint.
AEG has long maintained that Ticketmaster has a monopoly in the U.S. ticketing market and has used that monopoly power to subsidize Live Nation’s content business, prevent other companies from competing in these areas, and leave consumers to bear the consequences. This lawsuit is not just a lawsuit brought by the Department of Justice to break up a monopoly; the entire ecosystem of our industry, which has long been affected by a severely damaged ticketing model, is at risk. As you know, the cornerstone of Live Nation’s monopoly is Ticketmaster’s exclusive ticketing contracts with the vast majority of major concert venues in the United States. These agreements hinder competition and innovation, lead to higher ticket prices, and prevent artists from choosing who buys tickets for their shows and how much their fans should pay.
Following its filing with the Department of Justice, Live Nation made several public comments to defend its ongoing strategy of maintaining dominance by unfairly blaming others and making false and misleading statements for industry problems they have caused , and deny the importance of this case. Artists, venues and agents are not responsible for the country’s broken live entertainment business model – the responsibility lies with Live Nation. Despite its claims of profit margins or market share, it is a monopoly that uses its monopoly power to impose its will on the live entertainment business. Live Nation may claim that its promotional margins are low, but that’s only because it uses the excess profits of its ticketing monopoly to exceed the profitability of the concert market. Live Nation does this to eliminate competitors in the business and in turn leverage its continued control over content to maintain control of ticketing through venue exclusivity.
The serious nature of the DOJ’s case reflects the widespread view from 30 attorneys general across the country, as well as numerous media outlets, industry commentators, consumer groups and antitrust experts that Live Nation’s actions violated the law and harmed competition and consumers. While it may take some time, we have no doubt that the Department of Justice’s lawsuit will be successful and ultimately lead to sweeping changes that will lead to increased competition, more innovation and choice, benefiting fans, artists and our entire industry. The DOJ lawsuit means artists will be able to choose who buys their concert tickets, consumers will pay less for tickets, and ultimately artists and fans will be able to get what we all want: more at a great price , a higher quality live entertainment experience that fans can afford. We look to each of you to help us lay the foundation for the future of our industry.
Let’s not get distracted by Live Nation’s spin. Instead, let’s stay focused on continuing to perform at the highest level and prepare for the future state of the industry: a world with more competition, more innovation, more artist and consumer choice, lower ticket prices, and more music.
Jay Marciano
AEG Chairman and CEOglobal music business
