US Senate to Investigate Live Nation’s ‘Dominant Market Position’ After Taylor Swift Ticket Fiasco

Since Ticketmaster’s sales system buckled under the weight of millions of Taylor Swift fans last week, new calls have circulated among fans and politicians alike for the company to face the music over its cornering of the ticket sales market.

US media reports that the Senate would soon hold a hearing on monopoly practices by Live Nation Entertainment, the parent company of Ticketmaster, were confirmed on Tuesday by US Sen. Amy Klobuchar (D-MN).

"The high fees, site disruptions and cancellations that customers experienced shows how Ticketmaster’s dominant market position means the company does not face any pressure to continually innovate and improve," Klobuchar, who chairs the Senate’s antitrust committee, told reporters.

"That’s why we will hold a hearing on how consolidation in the live entertainment and ticketing industry harms customers and artists alike,” Klobuchar added. She did not provide a date or a list of witnesses.

The senator is one of several lawmakers who have spent the last week calling for such a hearing, and urging the US Department of Justice (DOJ) to open a new antitrust probe of Live Nation. Reports began circulating on Friday that a probe had been opened, but the DOJ has not confirmed its existence.

In a Monday letter to Attorney General Merrick Garland and Jonathan Kanter, head of the DOJ’s antitrust division, Sens. Klobuchar, Richard Blumenthal (D-CT), and Edward Markey (D-MA) urged the DOJ to divorce the two companies.

“While we are encouraged by recent reports that the Department is already investigating Live Nation’s conduct, an investigation alone does nothing for the stakeholders already harmed by Live Nation’s market dominance and seemingly ongoing anticompetitive behavior,” the senators wrote.

“If the investigation reveals that Live Nation has continued to abuse its dominant market position notwithstanding two prior consent decrees, we urge the Department to consider unwinding the Ticketmaster-Live Nation merger and breaking up the company. This may be the only way to truly protect consumers, artists, and venue operators and to restore competition in the ticketing market,” they added.

Bungled Tour Sale

The fiasco began last Tuesday, when tickets to singer Taylor Swift’s forthcoming “The Eras Tour” went on presale for “Verified Fans.” Overloaded with unexpected volume by fans excited for Swift’s first tour in four years, the site became clogged and many fans waited for hours. Then, on Friday, Ticketmaster canceled the release of Eras tickets for sale to the general public, citing the problems with the Tuesday event.

Swift took to Instagram to respond, saying “it really pisses me off” that Ticketmaster assured her it could handle the sales volume and that her beloved fans would receive easy and fast service.

Fury over the debacle has also driven Swifties - Taylor Swift’s enthusiastic fan base - into action as well, with groups like Vigilante Legal and Break Up Ticketmaster seeking to help attorneys general make the case for the company’s cornering of the market.

Longstanding Monopoly Accusations

It isn’t the first time Ticketmaster has been accused of monopoly practices. Grunge band Pearl Jam sued the company in 1994, but the DOJ declined to take up the case. When Live Nation moved to buy Ticketmaster in 2010, reports of its anti-market activities resurfaced, but the DOJ was satisfied with pledges by Live Nation not to abuse its market position.

Taylor Swift performing during "Taylor Swift's reputation Stadium Tour" at Papa John's Cardinal in Louisville.

© AP Photo / Invision/Amy Harris

Among the accusations of monopoly practices are claims that Ticketmaster has arbitrarily increased ticket prices, added abundant fees to its sales, and that it corners the market by forcing venues to sell tickets exclusively through their website.

In the wake of the botched sale, Ticketmaster tried to pass the blame on to AEG Presents, Swift’s tour promoter, by saying they chose to work with Ticketmaster. But on Tuesday, AEG pushed back.

“Ticketmaster’s exclusive deals with the vast majority of venues on the ‘Eras’ tour required us to ticket through their system,” AEG said in a statement to CNBC. “We didn’t have a choice.”

Live Nation controls 60% of the market for promotion of major concerts and is the exclusive provider for tickets at 80 of the top 100 performance arenas in the United States.