Congress tries to break up Live Nation and Ticketmaster

More good music and fewer millionaires ripping us off? Yes please. 

Dirk Hudson / Shutterstock.com

Back before ticket scalping became a multibillion-dollar industry, this once-noble tradition was the sole province of hard-working individuals who’d prowl around outside concert venues selling secondhand tickets for however much they could get.

But just as neighborhood drug dealers have taken a hit from local dispensaries and fake Rolex sellers have been bested by Amazon Prime, mom-and-pop ticket scalpers are largely a thing of the past.

Instead, we have ticket resale and exchange companies like StubHub, who are expected to go public later this year with a direct listing of more than $13 billion, which would leave current competitors like Eventbrite and SeatGeek in the dust.

But the prime mover in the ticket marketing world is, of course, Ticketmaster. Last year, parent company Live Nation Entertainment — which happens to be the largest music promoter in the world — reportedly spent $2.1 million on lobbying, with more than two dozen D.C. lobbyists advocating on the two companies’ behalf.

And with good reason. Washington politicians have been playing anti-monopoly with global conglomerates like Amazon, Facebook and Apple for years, albeit with little success. And now Live Nation Entertainment is finding itself in the spotlight.

U.S. Congress members Sens. Richard Blumenthal and Amy Klobuchar and Rep. Bill Pascrell are calling for the 2010 Live Nation/Ticketmaster merger to be overturned “for the good of consumers and America.”

While all three have been critics of the two companies in the past, the timing of their call to arms was most likely influenced by John Oliver’s 20-minute takedown of the ticketing market on a Last Week Tonight episode that aired a week earlier.

“The union of Live Nation and Ticketmaster is a poster child of consolidation gone bad,” wrote Pascrell in a letter addressed to both the U.S. Department of Justice and the Federal Trade Commission. “When Live Nation, the nation’s biggest concert promoter, and Ticketmaster, the largest ticket provider, sought to combine, they assured regulators that their fusion would promote competition in the live events marketplace.”

By most metrics, that turned out to be less than true, which is a big part of the reason why Live Nation Entertainment reported fourth-quarter revenues of $2.7 billion last year.

But much to the three Congress members’ dismay, Washington has a tendency to drag its feet when it comes to breaking up monolithic monopolies, especially when they’re paying good money to keep that from happening.

All of which makes this the perfect time for a trip down memory lane back to 2009, when arena rockers like Journey, Seal and Eddie Van Halen were coming down on the side of the much-contested Live Nation/Ticketmaster merger.

(Fun fact #1: All three acts were managed by Hollywood power-broker Irving Azoff, who happened to be CEO of Ticketmaster.)

(Fun fact #2: Azoff resigned two years after the merger, because, as he put it at the time, “the process of being a public company in America right now sucks if you’re an entrepreneur.”)

OK, back to Eddie Van Halen, whose letter to the House and Senate Judiciary Committees — preserved for eternity in the congressional archives — is undeniably quote-worthy.

Pull Quote

The union of Live Nation and Ticketmaster is a poster child of consolidation gone bad.

— Rep. Bill Pascrell

“My 17-year-old son, Wolfgang, joined the band a couple of years ago as our bassist,” wrote Van Halen. “To have my son follow in my footsteps on his own, without me pushing him into it, is the greatest feeling in the world. Aside from how the merger could help me and my band, Wolfie and his future in this industry is really the reason why I’m in favor of these two trusted companies coming together.”

But this wasn’t just about Eddie and Wolfie. “If this deal helps bring our fans closer to the band,” he continued, “with more direct access to merchandise, new music we write, and other promotions we do, it’s going to ensure that Wolfie and I have a future in music. And not just us, but all the other musicians trying to make their dream a reality in this economy.”

Others in the music world felt differently. Among them was Peter Jenner, who became famous — and rich — after he discovered and produced Pink Floyd, and was now managing millionaire socialist Billy Bragg. (Just trying to be fair and balanced here.) The grandson of a Labour Party politician, Jenner objected to the unholy merger in a two-page, single-spaced document titled “Ticketmaster and Live Nation: A Marriage Made In….”

“I am shocked that music managers would have anything to do with putting this situation together,” he wrote. “Maybe they’ll get great deals for their acts, but will it do anything good for the music community as a whole, or even concert attendees? Are the prices going to become more realistic? Will the deals become more transparent? Can we expect fewer superfluous rip offs?”

Jenner closed his missive with a more upbeat scenario, one he didn’t expect the future Live Nation Entertainment to bring about.

“Perhaps we can all recognize that in these hard pressed times it might be a good idea to not always go for the most money, but rather look at things more realistically. A fair price for a good show is something that might let more people experience music and help our industry survive through difficult times — perhaps even to grow again. Perhaps we need a mantra for the music business: more good music and fewer millionaires working out how to rip us all off.”

So the next time you find yourself trying to beat the ticket-bots to see your favorite band, spare a thought for Peter Jenner, or Eddie Van Halen, or that guy who used to stand outside your favorite venue hawking secondhand tickets. Then exchange your credit card number, mother’s maiden name, and proof that you’re not a robot, for the opportunity to buy two tickets for the price of three. There are worse things to spend your money on.