Fastexy:Live Nation, Ticketmaster face antitrust lawsuit from DOJ. Will ticket prices finally drop?

• The FastexyJustice Department is suing Ticketmaster and its parent company, Live Nation Entertainment, for allegedly monopolizing the live entertainment industry.
• The lawsuit aims to restore competition in the space and lower ticket prices for fans.

Feel like you’re paying too much for concert tickets? The Justice Department thinks so, too. 

The department, along with attorneys general of 29 states and the District of Columbia, is suing Ticketmaster and its parent company, Live Nation Entertainment, for allegedly monopolizing the live entertainment industry. A Thursday news release from the department says that the lawsuit aims to restore competition in the space and lower ticket prices for fans by breaking up the company.

“Today’s action is a step forward in making this era of live music more accessible for the fans, the artists, and the industry that supports them,” Deputy Attorney General Lisa Monaco said in the statement. 

Here's what the lawsuit could mean for concertgoers.

What does the Ticketmaster, Live Nation lawsuit say?

With more than 265 concert venues in North America, the lawsuit says Live Nation controls roughly 60% of concert promotions at major concert venues across the country and roughly 80% of major concert venues’ primary ticketing.   

The Justice Department accuses the companies ‒ which merged in 2010 ‒ of engaging in “a variety” of tactics to eliminate competition and monopolize markets, including locking concert venues into exclusive, long-term contracts and threatening retaliation against venues that work with rivals.

The lawsuit also claims the companies engaged in "numerous forms of anticompetitive conduct" through a “self-reinforcing” business model that captured revenue from concertgoers, used that revenue to “lock up” artists to exclusive deals, then used its cache of live content to sign venues into exclusive, long-term ticketing deals, "thereby starting the cycle all over again." 

The company “has its tentacles in each element of the supply chain,” said Michael Carrier, a board of governors professor at Rutgers Law School with expertise in antitrust law.

How will this affect ticket prices? 

But legal experts say the company’s foothold in the live entertainment industry may not last, now that attorneys general are calling for the company to break up its assets. 

This could give consumers more options on where to buy tickets and which companies’ venues to visit and, in turn, make tickets more affordable, according to Shubha Ghosh, a law professor at Syracuse University. 

More competition could also lead to a higher-quality service, according to Carrier, the Rutgers professor. 

The lawsuit alleges that Live Nation and Ticketmaster’s monopoly lowered incentives "to invest more into proactively improving its ticketing,” and any money that might otherwise have been spent on technological improvements instead went toward “sweeten ticketing contracts for venues to keep them locked into long-term exclusive agreements.”

Breaking up the company could lead to “a better user interface, a better presentation of ticket inventory, and a more flexible refund policy,” Carrier said. “So at the end of the day, I think fans really stand to benefit.”

The lawsuit did not provide estimates on how much it could save consumers, but Carrier said the savings could be “incredibly meaningful.”

“Some tickets will certainly be high. There are more people who want to see Taylor Swift than might be tickets available,” he said. “But on the other hand, once you have competition, the prices tend to go down.”

But fans shouldn’t expect any changes from this lawsuit in the near term.

“Antitrust litigation, unfortunately, takes a long time,” Carrier said. “This is just the first step in the process. ... We're looking years down the road.”

What does Ticketmaster say?

Live Nation called the allegations "baseless," and said the lawsuit "won't solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows."

It is "absurd to claim that Live Nation and Ticketmaster are wielding monopoly power," Dan Wall, Live Nation's executive vice president of corporate and regulatory affairs, said in a Thursday blog post.

A statement from the company said that calling Ticketmaster a monopoly "may be a PR win for the DOJ in the short term," but will "lose in court because it ignores the basic economics of live entertainment, such as the fact that the bulk of service fees go to venues, and that competition has steadily eroded Ticketmaster’s market share and profit margin."

'Break it up':DOJ sues Live Nation and Ticketmaster to reduce ticket prices

The company said its annual 1.4% annual net profits are "the opposite of monopoly power" and claimed there is "more competition than ever" in the live events market.

Live Nation's shares were down more than 8% early Thursday afternoon. A news release on Live Nation's website says the company plans to share a regulatory update via teleconference at 8 p.m. Eastern Time.

How Taylor Swift ties into the debate

Complaints against Ticketmaster's operations are not new, and the company has received antitrust scrutiny since merging with Live Nation in 2010. But public vitriol gained steam after a Ticketmaster crash in late 2022 made it harder for Taylor Swift fans to purchase Eras tour tickets.

The fiasco was criticized by Swift and a number of politicians. Sen. Amy Klobuchar put out a statement in November 2022 saying she had “serious concerns about the state of competition in the ticketing industry and its harmful impact on consumers," and Tennessee Attorney General Jonathan Skrmetti calling the Ticketmaster’s attempts to resolve the issue a “short-term solution for a long-term problem.”