Live nation
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Earlier this week, hackers on a “dark web” site claimed to have stolen data from hundreds of millions of Ticketmaster user accounts — but a source with knowledge of the investigation into the attack says there is no evidence that Ticketmaster fan accounts were compromised or that private user data was stolen.
Officials at Ticketmaster’s parent company, Live Nation, acknowledged a breach Friday (May 31) in a Securities and Exchange Commission (SEC) filing, noting it had identified “unauthorized activity within a third-party cloud database environment containing Company data (primarily from its Ticketmaster L.L.C. subsidiary) and launched an investigation with industry-leading forensic investigators to understand what happened.”
The statement noted that the company was “cooperating with law enforcement” and that “as of the date of this filing, the incident has not had, and we do not believe it is reasonably likely to have, a material impact on our overall business operations or on our financial condition or results of operations.”
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According to the source, federal authorities are currently working to understand how a “dark web” site seized by the federal government was recaptured on Monday (May 27) by hackers with the group ShinyHunters and used to ransom 1.3 terabytes of private data allegedly stolen from Ticketmaster for $500,000. Investigators aren’t sure what, if any, Ticketmaster files are being held in the 1.3 terabyte file, the source adds.
The hack, the source tells Billboard, did not involve a breach of the core Ticketmaster system. Rather, company officials are looking at cloud hosting service Snowflake as a possible site of the hack. A hacker claiming to be involved in the attack told the website Bleeping Computer that they had breached Santander Bank and Ticketmaster after hacking into an employee’s account at Snowflake, which provides cloud hosting services for major companies. According to that report, Snowflake is disputing the claim. Billboard independently confirmed that Ticketmaster uses Snowflake’s cloud hosting service.
When reached for comment, Live Nation directed Billboard back to the SEC filing. Snowflake did not respond to a request for comment by press time.
Australian ticketing firm Ticketek also reported Friday that it had fallen victim to hackers, notifying customers that the names of some of its users, as well as their dates of birth and email addresses, may have been accessed in a data breach. In a statement on its site, Ticketet said the user information had been stored in a cloud-based platform hosted by a “reputable, global third-party supplier”.
“Ticketek has secure encryption methods in place for all passwords and no Ticketek customer account has been compromised,” company officials said in a statement. “Additionally, Ticketek utilises secure encryption methods for online payments and uses a separate system to process online payments, which has not been impacted. Ticketek does not hold identity documents for its customers.”
Live Nation’s share price has proven to be resilient following the U.S. Department of Justice’s lawsuit and effort to break up the company’s concert promotion and ticketing operations. Eight days into what is likely to be a multi-year journey through the court system, shares of Live Nation dropped 2.3% to $93.74 and have held steady after an initial drop the day of the DOJ’s announcement.
Live Nation shares closed at $101.40 on May 22, the day before the DOJ announced its lawsuit, and dropped 7.8% to $93.48 when the news broke the following day. Since the announcement, however, Live Nation shares are up 0.3%. Still, amidst the uncertainty surrounding the outcome of the lawsuit, Live Nation’s year-to-date gain has been pared to just 0.1%, while its 52-week gain has been reduced to 13.2%.
Regardless of the outcome, the mere existence of a protracted legal battle is enough to exert a drag on the stock. In lowering their price target for Live Nation to $116 from $126 this week, J.P. Morgan analysts said in a Wednesday (May 29) note to investors they doubt the DOJ will succeed in breaking up the company and its Ticketmaster ticketing arm, but noted the effect of a “sentiment overhang.” J.P. Morgan maintains its “overweight” rating on Live Nation and analysts “believe that continued execution on [adjusted operating income] growth should drive shares higher, with significant valuation upside should developments in the lawsuit break positive.”
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Music stocks were broadly down this week as the biggest companies in the Billboard Global Music Index lost ground. The index fell 2.3% to 1,799.07 as Spotify fell 3.8% to $296.53, Universal Music Group dropped 0.9% to 28.58 euros ($31.03), Warner Music Group sank 2.2% to $29.78 and HYBE dipped 0.2% to 200,000 won ($144.60). Ten of the 20 companies in the index were losers this week, nine gained ground and one was unchanged.
The index has gained 17.9% year-to-date on the strength of music streaming companies. Tencent Music Entertainment and Spotify lead all stocks with gains of 60.4% and 57.8%, respectively, through the end of May. Elsewhere, Hipgnosis Songs Fund has gained 39.7% due to the company’s pending sale to Blackstone, German concert promoter CTS Eventim is up 26.8% and Chinese music streamer Cloud Music has gained 22.7%.
Radio company iHeartMedia has the distinction of being the top-performing music stock of the week while carrying the worst year-to-date performance. Shares of the radio giant rose 6.4% to $0.926, marking a respite from a month-long free fall during which the stock has traded below $1.00 per share over the last seven trading days. Even after this week’s gain, iHeartMedia finished the month of May down 56% and has lost 65.3% year to date.
Reservoir Media shares gained 2.4% to $8.04 this week following the company’s fiscal fourth-quarter earnings release on Thursday (May 30). The company beat guidance for both revenue and adjusted EBITDA and its share price rose as much as 15.5% in the wake of the news. Following the earnings results, B Riley raised its price target for Reservoir to $11.50.
Music streaming company LiveOne fell 6.3% to $1.65 this week after fiscal year results on Thursday showed the company’s revenue grew 19% to $118.4 million. LiveOne shares are up 17.9% year to date.
Overall stocks were broadly down this week but performed better than the Billboard Global Music Index. In the United States, the S&P 500 dropped 0.5% to 5,277.51 and the Nasdaq composite fell 1.1% to 16,735.02. In the United Kingdom, the FTSE 100 fell 0.5% to 8,275.38. South Korea’s KOSPI composite index sank 1.9% to 2,636.52. China’s Shanghai Composite Index declined just 0.1% to 3,086.81.
AEG CEO Jay Marciano says Live Nation acts like a monopoly and agrees with the U.S. Department of Justice’s effort to break the concert giant and Ticketmaster up, according to an email Marciano sent out to employees on Friday (May 31). In the memo, the executive accuses the company of “preventing other businesses from competing” and “leaving consumers to suffer the consequences.”
In the two-page email, Marciano said the lawsuit was an important milestone for addressing alleged monopolistic behavior in the concert business, noting “the entire ecosystem of our industry” is at stake as the case winds its way through the U.S. legal system.
“Notwithstanding its claims about its profit margins or its market share, it is a monopoly, and it uses its monopoly power to impose its will on the live entertainment business,” wrote Marciano of Live Nation, later writing, “We strongly believe that DOJ’s lawsuit will succeed and ultimately bring sweeping changes.”
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Billboard obtained a copy of the email, which can be read in full below. An AEG spokesman did not respond to a request for comment regarding the letter. Live Nation had not responded to a request for comment at press time.
From: Office of Jay Marciano
No doubt all of you are closely following the ongoing media coverage in the wake of the Department of Justice lawsuit against Live Nation and Ticketmaster. As I mentioned in my note from last week, we spent the last 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 marketplace and uses that monopoly power to subsidize Live Nation’s content businesses, preventing other businesses from competing in those areas and leaving consumers to suffer the consequences. This lawsuit is not simply DOJ suing to break up a monopoly; at stake is the entire ecosystem of our industry, one that has long suffered from a badly broken ticketing model. 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 block competition and innovation and result in higher ticketing fees, denying artists the ability to choose who will ticket their shows and how much their fans should pay.
Following the DOJ filing, Live Nation issued several public comments in service of its ongoing strategy to maintain its dominance – unfairly blaming others for industry problems they have created, making false and misleading statements, and dismissing the significance of the case. Artists, venues, and brokers are not responsible for the broken live entertainment business model in this country – that responsibility lies with Live Nation. Notwithstanding its claims about its profit margins or its market share, it is a monopoly, and it uses its monopoly power to impose its will on the live entertainment business. Live Nation may claim that its margins on promotion are low, but that’s only because it deploys the excessive profits of its ticketing monopoly to outspend what the concert market can profitably sustain. Live Nation does this with the goal of removing competitors from the business and in turn using its continued control of content to preserve a stranglehold on ticketing through venue exclusives.
The DOJ’s case is serious and reflects widespread sentiment among 30 attorneys general from across the country, numerous media outlets, industry commentators, consumer groups, and antitrust experts that Live Nation’s conduct violates the law and harms competition and consumers. While it may take some time, we strongly believe that DOJ’s lawsuit will succeed and ultimately bring sweeping changes resulting in increased competition and more innovation and choice that benefits fans, artists, and ourentire industry. DOJ’s lawsuit means that artists will have a choice in who tickets their concerts, that the ticketing fees consumers pay will be lower, and ultimately that artists and fans will have access to what we all want: more and higher quality live entertainment experiences at a price that fans can afford. We look forward to each and every one of you helping us lay the groundwork now for the future of the industry.
Let’s not get distracted by Live Nation spin. Instead, let’s stay focused on continuing to execute at the highest level, and preparing for a future state of the industry: a world with more competition, more innovation, artist and consumer choice, lower ticketing fees, and more music.Jay
Sorry, kids — Live Nation’s antitrust issues have nothing to do with how hard it is to get Taylor Swift tickets. Those are expensive because there just aren’t enough for everyone who wants to see the show, and the antitrust lawsuit against Live Nation won’t change that — and it might not even change the cost of tickets. What it could do, though, is reshape the way the U.S. concert and ticketing businesses work — as well as how they work together.
The lawsuit, filed by the Department of Justice and more than two dozen states, alleges that Live Nation colluded with the venue management company Oak View Group, threatened potential rivals, locked venues into long-term agreements with Ticketmaster in a way that shuts out competitors, restricted promoters’ access to its venues, and acquired companies to reduce competition. There’s a lot there.
Live Nation, at least according to the lawsuit, operates less like a concert promoter than a live entertainment platform — one that uses its dominance in some sectors to secure or further its dominance in others by making it hard for other companies to separate out its services. The most relevant comparison, at least in legal terms, might be the Microsoft antitrust case. Almost all of the behavior described in the lawsuit takes place outside of public view, but the Department of Justice argues that it reduces competition, and indirectly raises ticket prices for consumers. The first of these seems very likely, at least based on the descriptions of company policy in the lawsuit, but the second is less clear. Based on the thriving secondary market, concert tickets still seem to be underpriced.
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The common complaint about Live Nation is that it controls too many venues, and that Ticketmaster has too large a share of the ticketing business, especially in ways that annoy the hell out of consumers. Those factors may be less important than they seem, though. Most areas only have so many venues, and it’s not entirely clear how much sense it might make to have more than one ticket retailer handle each show. (It’s far easier to argue that companies in the primary market shouldn’t enter the secondary market, and vice versa.) And since a share of Ticketmaster fees end up going to promoters or venues anyway, cutting them could just end up shifting costs to the face-value price of tickets. I hate the extra charges on budget airlines, but eliminating them would just make tickets more expensive.
The more serious issue is how Live Nation uses its market power. Ticketmaster signs long-term contracts with venues in exchange for exclusive ticketing rights, which has been an issue since Pearl Jam took on the practice three decades ago. But the most damning parts of the lawsuit, to which Live Nation will respond before the end of summer, involve issues that haven’t received as much attention. The Department of Justice alleges that Live Nation restricts artists from performing in its venues unless they also use the company as a promoter and presses venues to sign exclusive deals with Ticketmaster. This kind of behavior is an important part of what antitrust law is designed to prevent — wielding the leverage that comes from dominance in one market to gain an unfair advantage in others. The government would need to prove its case, though — and antitrust cases can be hard to win.
The lawsuit alleges that Live Nation works that way by design. It references a 2019 statement by CEO Michael Rapino that “we have to put the show where we make the most economics,” and that venues that use other ticketing companies could be at a disadvantage. (Under the terms of an antitrust consent decree, Live Nation has a court-appointed monitor tasked with preventing this.) The question is whether Live Nation operates this way, and whether what might be thought of as its platform is intended to do so.
Hence the comparison to Microsoft, which the Department of Justice sued in 1998 for trying to use its dominance in operating systems, and its resulting leverage over PC makers, to control the market for web browsers. (Microsoft lost in district court; that decision was partly overturned by the court of appeals; and the case was eventually settled.) In that case, though, the compatibility issues were intuitive and the harm to consumers was obvious.
For years, antitrust law focused on protecting consumers from higher prices, and it’s not entirely clear that tickets would get cheaper — or that there would be more or better concerts — if Live Nation were constrained or broken up. Some judges and scholars now take a broader view, though, and it’s easier to imagine that more competition would lead to more innovation.
Apart from the legal issues, the lawsuit portrays Live Nation as a minefield of conflict of interest, where the best side of a deal to be on is both of them. Thinking about the company means appreciating the significant synergies among its different businesses while somehow also believing that those different businesses can negotiate fairly with one another. Think of Live Nation’s talent management operation, where agents that represent artists sometimes negotiate deals for concerts against another division of the company. The artists must be satisfied with the service they’re getting, but you also have to wonder if the House always wins.
This is just the opening salvo in what’s likely to be a long conflict — antitrust cases tend to be long and complicated, and this one could have eras, like Swift. By the end of it, though, whichever side wins, Live Nation will either be constrained from having its various divisions work together in a way that disadvantages competitors or it will have to take more care that they don’t — and this can only be a good thing for the rest of the business.
A well-known hacking group claims to have breached Ticketmaster and is attempting to sell the personal data of 560 million Ticketmaster users, including their payment details, for $500,000, according to the website Hackread.
Alleged hacking group ShinyHunters has claimed credit for the break-in, resulting in the theft of 1.3 terabytes of stolen data that includes usernames, contact information, order info and partial payment details, like the last four digits of a customer’s credit card, expiration dates and even details designed to prevent fraud (i.e. mother’s maiden name).
Officials with Live Nation, which owns Ticketmaster, have not responded to requests for comment from Billboard or confirmed that the breach took place, but Australian officials with the country’s Department of Home Affairs told the Australian Broadcasting Company that it was aware of a cyber incident that was part of a data leak expected to impact millions of Ticketmaster customers globally.
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A spokesperson from the Department of Home Affairs told the ABC that the department is “working with Ticketmaster to understand the incident”.
“The data breach, if confirmed, could have severe implications for the affected users, leading to potential identity theft, financial fraud, and further cyber attacks,” the Hackread site explains. “The hacker group’s bold move to put this data on sale goes on to show the growing menace of cybercrime and the increasing sophistication of these cyber adversaries.”
The hack comes as Ticketmaster and Live Nation face attempts by the federal government to break the company up on antitrust grounds. Last week, the Department of Justice’s antitrust division sued Ticketmaster in New York’s Southern District, alleging that the company acted monopolistically. Company officials have vowed to fight the lawsuit.
ShinyHunters emerged on law enforcement’s radar in 2020 and has been linked to breaches affecting more than 60 companies. The group is known to use dark web forums to threaten to leak sensitive consumer information unless the affected companies pay an online ransom. Most breaches are carried out using sophisticated phishing pages that mimic their target’s login portals, tricking employees into entering account credentials and other sensitive data. Members of ShinyHunters then use the stolen credentials to log in to company systems and steal data and customer information.
In January, a U.S. District Court in Seattle sentenced alleged ShinyHunters member Sebastien Raoult to three years in prison and restitution of $5 million after Raoult pleaded guilty to conspiracy to commit wire fraud and aggravated identity theft. The 22-year-old French national was arrested in Morocco in 2022 and extradited to the United States in January 2023.
ShinyHunters is reportedly selling the Ticketmaster data on Breach Forums, an illegal marketplace that just two weeks ago had been seized by the FBI.
On May 13, FBI officials apprehended the site’s administrator and seized access to login credentials for the entire infrastructure of Breach Forums, including the backend, across its dark web and clear web sites.
“From June 2023 until May 2024, BreachForums was operating as a clearnet marketplace for cybercriminals to buy, sell, and trade contraband, including stolen access devices, means of identification, hacking tools, breached databases, and other illegal services,” FBI official said in a statement at the time.
But several days later, ShinyHunters allegedly contacted the domain registrar of Breach Forums and successfully regained access, according to Hack News, with the FBI seizure notice on the site replaced by a “Site Temporarily Unavailable” message. Earlier today, Breach Forums was updated again, this time with the alleged stolen Ticketmaster data posted on the site for sale.
The one remaining wrongful death lawsuit filed after 10 people were killed during a deadly crowd crush at the 2021 Astroworld music festival has been settled, an attorney said Thursday.
Jury selection in the lawsuit filed by the family of 9-year-old Ezra Blount, the youngest person killed during the concert by rapper Travis Scott, had been set to begin Sept. 10.
But S. Scott West, an attorney for Blount’s family, said a settlement was reached this week.
Blount’s family had sued Scott, Live Nation — the festival’s promoter and the world’s largest live entertainment company — and other companies and individuals connected to the event, including Apple Inc., which livestreamed the concert.
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“The family will continue its journey to heal, but never forget the joy that Ezra brought to everyone around him,” West said in an email.
Treston Blount, Ezra’s father, had said that during the Nov. 5, 2021, concert, his son was sitting on his shoulders when they were crushed by the crowd. Treston Blount lost consciousness and when he came to, Ezra was missing. A frantic search ensued until Ezra was eventually found at a Houston hospital, severely injured. The boy, who was from Dallas, died several days later.
The lawsuit filed by Blount’s family was one of 10 wrongful death civil suits filed after the deadly concert.
Earlier this month, lawyers had announced that the other nine wrongful death lawsuits had been settled in connection with the concert.
Terms of the settlements in all 10 lawsuits were confidential.
The settlement of the lawsuit filed by Blount’s family was first reported by the Houston Chronicle.
Attorneys for Live Nation, Scott and others have declined to comment in the case because of a gag order that limits what they can say outside court.
About 2,400 injury cases filed after the deadly concert remain pending. More than 4,000 plaintiffs filed hundreds of lawsuits after the Astroworld crowd crush.
During the crowd crush, attendees were packed so tightly that many could not breathe or move their arms. Those killed ranged in age from 9 to 27. They died from compression asphyxia, which an expert likened to being crushed by a car.
Earlier this month, state District Judge Kristen Hawkins, who is presiding over the litigation, had scheduled the first trial related to the injury cases for Oct. 15. That trial was set to focus on seven injury cases. It was not clear on Thursday if that trial date would remain or be moved up with the settlement in the Blount lawsuit.
So far, no lawsuit has gone before a jury. One wrongful death lawsuit — filed by the family of 23-year-old Houston resident Madison Dubiski — was days away from going to trial earlier this month before it was delayed and then settled.
Lawyers for the plaintiffs in the lawsuits have alleged in court filings that the deaths and hundreds of injuries at the concert were caused by negligent planning and a lack of concern over capacity and safety at the event.
Scott, Live Nation and the others who’ve been sued have denied these claims, saying safety was their No. 1 concern. They said what happened could not have been foreseen.
After a police investigation, a grand jury last year declined to indict Scott, along with five others connected to the festival.
The Department of Justice dropped a wide-ranging antitrust complaint against Live Nation on Thursday (May 23), highlighting more than a dozen examples of the company’s “anticompetitive and exclusionary” behavior in accusing it of operating live music’s largest monopoly.
The evidence looks particularly bad for Live Nation chief executive Michael Rapino, whose own emails are being used against him to document alleged threats made against competitors while the company was operating under a federal consent decree tied to its 2010 merger with Live Nation.
Under the arrangement, regulators with the government had the right to obtain company documents, including communications, without a subpoena. The most damaging evidence is an email exchange involving Oak View Group’s Tim Leiweke and mega music manager Irving Azoff, who co-founded the arena development and management company together.
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Leiweke was the CEO of AEG, Live Nation’s main rival in the concert business, until 2012, when he was fired by company owner Phil Anschutz. After a brief stint running the Toronto Maple Leafs and its sports and entertainment interests in Canada, he returned to the United States and eventually founded Oak View Group (OVG) in 2015.
The government claims Rapino tried to leverage his company’s partnership with OVG to pressure private equity firm Silver Lake to kill off a rival ticketing company that Rapino allegedly believed represented a major threat to Ticketmaster.
If true, the story could be a major problem for Rapino, underscoring the government narrative that despite Live Nation’s massive market share, the CEO operates the company like a paranoid pugilist, willing to cross ethical and legal boundaries to eliminate tiny threats.
Silver Lake has been OVG’s strategic investment partner since the company’s founding, investing $100 million to launch it. Today, it has more than $2.5 billion tied up in OVG development projects. Silver Lake also owns TEG, an Australian concert promotion company that operates Ticketek, a large Australian ticket provider with more than 130 clients.
According to the 120-page complaint filed Thursday in federal court, “In 2021, Live Nation’s CEO complained to Oak View Group’s co-founder that TEG was ‘[f]ull on competitors.’ Oak View Group, in turn, conveyed to Silver Lake that Live Nation was ‘not happy.’” The complaint adds that Rapino then escalated his complaints to Silver Lake directly, stating: “I am all in on [Oak View Group] where the big play lies with venues – why insult me with this investment in ticketing/promotions etc.’”
According to the lawsuit, “Rapino threatened to pull its support from Oak View Group and instead back an Oak View Group competitor unless TEG stopped competing with Live Nation in the United States,” the complaint alleges.
“I can assure you the OVG investment is a much bigger win then T[E]G,” Rapino wrote in an email to an unnamed Silver Lake executive that’s included in the lawsuit. “It’s been a huge win for both sides– we have over 20 global arenas in development that neither could do without the other … do you really want LN backing [AEG’s venue development and management company]…? Seems like a dumb trade off??”
To aid in the pressure campaign, Azoff “reportedly refused to allow TEG to promote any of his large roster of artist clients,” the complaint alleges. It further states that Azoff told Rapino “that he was going to demand that Silver Lake sell TEG. [To which] Live Nation’s CEO replied ‘Love ya.’”
“Silver Lake now seems ‘intent on dumping teg’ and has asked, through the founder of Oak View Group, whether Live Nation would be interested in purchasing TEG,” the complaint reads in describing the back-and-forth.
Live Nation did not purchase TEG, but in early 2023, a deal was brokered for Silver Lake to sell the company to investment companies Blackstone and KKR. That deal collapsed in October over disagreements over the valuation of the company, which is now being readied for an IPO in Australia.
Live Nation issued a statement on this allegation, stating that the “claim reveals not only a disregard for the facts, but also deep hypocrisy.”
“The current DOJ and FTC have been vocal critics of private equity companies making multiple investments in the same industry because of competitive ‘entanglements,’” the statement continues. “So was Live Nation CEO Michael Rapino when, after it had already made an investment in OVG, Silver Lake Partners decided to invest in the Australian live entertainment company, TEG. Rapino’s complaint was fundamentally the same as the DOJ/FTC concern with private equity rollups: it created a conflict between OVG, which had become a close partner to Live Nation, and TEG. So, in December 2021 when a TEG employee wrote to say that it did not intend to compete with Live Nation in the U.S., Rapino replied to Silver Lake’s management that he did not care about TEG, but still had a problem with Silver Lake’s decision to make multiple conflicting investments in the industry.”
The statement also claims that “there is no truth that this brief exchange had anything to do with Silver Lake’s decision to sell its stake in TEG.”
In addition to the allegations around TEG, the government’s complaint further alleges that OVG, when it was first founded in 2015, was “particularly well-suited to be a real competitor to Live Nation in the United States concert promotion business” but changed its model to avoid competing with Live Nation.
The evidence from the time, however, shows that OVG and Live Nation had long billed themselves as partners. A November 2015 press release announcing OVG’s launch includes a quote from Rapino endorsing Leiweke’s business model, stating, “Both Tim and Irving are friends of Live Nation as well as personal friends. The concept of creating an economic model for both arena’s and touring artists that creates new revenue streams and develops an ‘anchor’ type of platform for music is one we share.”
The DOJ claims that Live Nation initially identified OVG as one of its “Biggest Competitor Threats” but that over time, the two firms morphed “from competitors into partners who found it easier and mutually beneficial to work together rather than compete.”
According to the government, OVG in fact operates as “a self-described ‘pimp’ and ‘hammer’ for Live Nation, with Leiweke once telling Rapino ‘[j]ust like I tell our folks we 100% always protect you and LN on your lanes.’”
In 2016, “after learning that Oak View Group offered to promote an artist Live Nation had previously promoted, Live Nation’s CEO immediately emailed Oak View Group, warning that such competition would only lead to artists demanding more compensation,” reads the complaint. It further includes an email in which Rapino wrote of the artist: “Whats up? We have done his [touring] and vegas[.] Let’s make sure we don’t let [the artist agency] now start playing us off.”
As outlined in the complaint, Leiweke immediately responded, “Our guys got a bit ahead. All know we don’t promote and we only do tours with Live Nation.”
Azoff later chimed in, writing “Growing pains,” subsequently noting that OVG executives “should never discuss comp [for artists],” and that OVG’s talent buyers would work for Live Nation.
The government argues that this discussion is an example of Leiweke and Azoff colluding with Rapino to limit the competitive bids sent to an artist in order to keep artists fees low. In another example cited in the complaint from 2022, Rapino admonished Leweike for making a direct offer to an artist to play an OVG venue instead of asking Live Nation to promote the show for OVG.
“Who would be so stupid to do this and play into [the artist agent’s] arms”? Rapino asked Leiweke in the email. Leiweke responded, “We have never promoted without you. Won’t,” before later writing, “[m]ore than happy to do these deals thru LN as I have always been aligned,” and that “I never want to be competitors.”
The complaint also alleges that Live Nation “exploits its long-term relationship with Oak View Group to flip venues to Ticketmaster, further cementing Ticketmaster’s power.”
According to the DOJ, in 2022, Live Nation and OVG signed an unspecified agreement that resulted in OVG recognizing “it has a significant financial interest in maintaining existing Ticketmaster contracts at its venues and converting other venues to Ticketmaster.”
At some point, according to the lawsuit, Leiweke told Rapino that the deal “allows us to tie up all owned and operated facilities to 10 year deals, develop a standard A and B market deal for all future projects and to convert all OVG 360 deals to TM now or as they expire for 10 years… Appreciate the consideration and partnership and all of us will work diligently on this so we are always aligned with TM.”
Live Nation responded to this claim in a statement: “The theory is that the contract gave Ticketmaster an unfair advantage in securing the business of independent venues that were managed by OVG because it creates financial incentives for OVG to ‘advocate for’ Ticketmaster. But there is nothing remotely anticompetitive about that. Commercial arrangements that involve incentive or marketing payments are common throughout this industry (and many others).” The statement adds, “Ticketmaster competed and won the contract on the merits because OVG determined it was the best ticketing system available.”
The U.S. Department of Justice and a group of 30 states on Thursday filed a long-awaited antitrust lawsuit against Live Nation, accusing the concert giant of market dominance and demanding that it and Ticketmaster be broken up. “It is time to break it up,” said Attorney General Merrick Garland at an announcement of the suit on Thursday.
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The lawsuit, filed in Manhattan federal court, claims that Live Nation has abused its huge market power to stifle competition, including through the use of exclusive ticketing contracts that lock venues into using Ticketmaster for all events. As part of its case against Live Nation, Garland said the government will present evidence taken from emails between Live Nation chief executive Michael Rapino and Oak View Group chief Tim Leiweke, as well as communications between Rapino and the head of powerful equity firm Silver Lake capital.
“We allege that Live Nation has repeatedly wielded its powers to keep its rivals from expanding in the U.S. concert promotions market through threats and retaliation,” Garland said. In his remarks, he alleged that in 2021, Live Nation threatened to retaliate against Silver Lake unless it divested from TEG, one of its portfolio companies. According to Garland, Live Nation chief Michael Rapino told Silver Lake that he “failed to understand why [the equity firm] continued to invest in a business that competes with Live Nation.”
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Garland added: “The threats ultimately succeeded and Silver Lake has tried to sell TEG altogether. We allege that Live Nation does not maintain its dominance in the live industry by staying ahead of its competition on the merits. It does so by unlawfully eliminating its competition. We allege that Live Nation controls the live entertainment industry in the United States because it is breaking the law.”
To address the alleged violations, the DOJ argues that Live Nation must divest ownership of Ticketmaster – effectively undoing a controversial 2010 merger that was approved by federal regulators despite fears that it would give the company too much power over live music.
“Today’s complaint alleges that Live Nation-Ticketmaster have engaged in anticompetitive conduct to cement their dominance of the live concert market and act as the gatekeeper for an entire industry,” said Deputy Attorney General Lisa Monaco during today’s press conference. “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.”
Live Nation has long faced criticism over its market share, but scrutiny of the company increased dramatically following the disastrous November 2022 rollout of tickets for Taylor Swift’s 2023 Eras Tour, which saw widespread service delays and website crashes.
The DOJ had already launched an investigation into the company’s practices earlier in 2022, prior to the Swift incident. But the botched presale sparked Congressional hearings, civil antitrust lawsuits, and calls to break up the company. Lawmakers like Sen. Amy Klobuchar (D-Minn.), the chair of the Senate subcommittee for antitrust issues, warned that Live Nation’s power “insulates it from the competitive pressures that typically push companies to innovate and improve their services.”
According to the 120-page complaint filed by the government, Live Nation-Ticketmaster has “unlawfully maintained monopolies in several concert promotions and primary ticketing markets and engaged in other exclusionary conduct affecting live concert venues, including arenas and amphitheaters.”
The complaint specifically takes aim at Live Nation’s “flywheel model,” which it describes as a “self-reinforcing business model that captures fees and revenue from concert fans and sponsorship, uses that revenue to lock up artists to exclusive promotion deals, and then uses its powerful cache of live content to sign venues into long term exclusive ticketing deals, thereby starting the cycle all over again.”
Live Nation has rejected such accusations. In a blog post last month, the company’s top antitrust lawyer argued that claims about “monopolies” were designed to “rile up fans against Live Nation and Ticketmaster.” As recently as Tuesday, company president Joe Berchtold said that the company’s practices were “fully defensible” and that a settlement with the DOJ was still possible.
“The DOJ’s lawsuit won’t solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows,” a statement from Live Nation reads. “Calling Ticketmaster a monopoly may be a PR win for the DOJ in the short term, but it 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. Our growth comes from helping artists tour globally, creating lasting memories for millions of fans, and supporting local economies across the country by sustaining quality jobs. We will defend against these baseless allegations, use this opportunity to shed light on the industry, and continue to push for reforms that truly protect consumers and artists.”
When Live Nation and Ticketmaster merged in 2010, the DOJ approved the deal but imposed a so-called consent decree designed to prevent the company from abusing its position. Those restrictions were set to expire in 2020, but they were extended by five years after the DOJ accused Live Nation of repeatedly violating the decree.
A Department of Justice lawsuit against Live Nation for violating U.S. antitrust laws is imminent and could be filed as soon as Thursday (May 23), a source with knowledge of the DOJ’s plans tells Billboard.
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The lawsuit is rumored to charge that Live Nation has a monopoly on event ticketing through Ticketmaster and that it illegally uses its monopoly power to grow its business and stifle competition. The DOJ has been investigating Live Nation for more than two years. With that investigation now wrapped, company president Joe Berchtold recently said he was that he was hopeful his company would avoid a legal showdown with the DOJ’s top antitrust lawyer, Jonathan Kanter.
“These are always serious discussions. We wouldn’t get to this point if they didn’t have concerns, but the good news is we’re still talking and they’ve said they have an open mind,” Berchtold told attendees at the J.P. Morgan Global Technology, Media and Communications conference in Boston on Tuesday (May 21).
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“Without getting into the real details of the conversation, I think it’s fair to say I continue to believe that we fundamentally have business practices that are fully defensible,” Berchtold added, before continuing: “We’re also open to figuring out common ground in order to get this settled and moved on. But we don’t know exactly what they want at this point still.”
Live Nation declined to comment for this story.
The Department of Justice’s case is believed to be centered around Ticketmaster’s use of exclusive ticketing contracts when signing up venues for its ticketing services. Typically, Ticketmaster pays venues an advance on the revenue that it generates from the fees it charges consumers as part of the ticket-buying process. The longer the contract, the larger the advance Ticketmaster can pay out.
DOJ officials don’t like the practice, arguing that it locks out new companies from competing in the ticketing space. Ticketmaster officials, however, argue that they are open to working with non-exclusive contracts — both the Greek Theatre in Hollywood and Red Rocks in Denver are open facilities where promoters use the ticketing provider of their choice — but that venues often rely on exclusive deals to meet their capital needs.
While Ticketmaster holds more exclusive ticketing contracts than any other company, it isn’t the only one to make use of them: Every major competitor pays upfront advances in exchange for exclusive ticketing agreements with venues and sports teams.
That includes SeatGeek, which reportedly paid $10 million in 2021 for exclusive rights to ticket events at the Barclays Center in Brooklyn for a seven-year term. Two years into the agreement, Billboard reported at the time, Barclays Center and BSE Global chief executive Sam Zussman threatened to publicize SeatGeek’s tech problems and breaches of contract if it didn’t immediately agree to terminate the deal.
SeatGeek eventually agreed to wind down its relationship with Barclays Center and was replaced by Ticketmaster. DOJ officials reportedly scrutinized the incident during its investigation of Live Nation.
Officials with the Department of Justice’s Antitrust Division plan to sue Live Nation after they wrap up a two-and-a-half-year investigation into the company, according to two high-level sources with knowledge of the matter.
The lawsuit will take aim at Ticketmaster’s use of exclusive venue contracts for its ticketing services, the sources say. Last week, Live Nation officials met with attorneys from the Department of Justice to discuss the case, including DOJ Assistant Attorney Jonathan Kanter, but neither the DOJ nor Live Nation commented on the meeting’s details. There’s no clear timeline on when the DOJ plans to officially close its investigation or file suit, and the two sides could meet again to discuss the case. Both The Wall Street Journal and Politico have previously reported that the DOJ planned to sue Live Nation in published reports earlier this year.
Live Nation officials are continuing to cooperate with the investigation, company president Joe Berchtold indicated on a May 2 earnings call. Based on the issues the DOJ has raised with Live Nation, Berchtold said he believes the lawsuit is related to “specific business practices at Live Nation” and “not the legality of the Live Nation/Ticketmaster merger.”
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That’s both good and bad for Live Nation officials. On the one hand, if the merger isn’t central to the government’s case, then ending the merger and splitting the company up probably isn’t on the table — at least according to Berchtold. Alternatively, if the government believes that the company’s use of exclusive ticketing contracts with venues is monopolistic, it could propose an even harsher penalty.
That’s because politicians like Senator Amy Klobuchar (D-Minn.), who chairs the anti-trust subcommittee in the Senate, have zeroed in on Ticketmaster’s 70-80% market share of the top 100 highest-grossing theaters, arenas and stadiums in North America. Klobuchar has repeatedly said she believes Ticketmaster uses exclusive contracts to lock up market share. In contrast, Ticketmaster attorneys and industry advocates have argued before that the exclusive nature of these contracts benefits venues because it simplifies the ticket-buying process for consumers and generates important revenue for venues that they would not earn without an exclusive agreement.
DOJ officials are also expected to argue that Live Nation has illegally abused its power in the concert business to drive up ticket prices over the last decade, in part through additional fees that can add as much as 30% to ticket prices.
But officials from Ticketmaster, which Live Nation controls, have long argued that artists set their ticket prices, not Ticketmaster, and that only a small percentage of the fees collected above face value go to the ticketing company, with the vast majority of those funds going to venues to help cover the costs of a concert.
The government also bears the burden of proving why its proposed remedies — like forcing Live Nation to sell its stake in Ticketmaster — would benefit consumers.
Simply being named in an antitrust lawsuit filed by Kanter has the potential to significantly damage Live Nation reputationally and financially. A detailed lawsuit against it could galvanize the company’s critics behind a narrative that alleges the concert conglomerate acts monopolistically and abuses its power, undoing the company’s efforts in recent years to improve its image and destigmatize its business model.
A lawsuit will also likely have a negative impact on the company’s share price and serve as a major distraction for Live Nation when it would otherwise be focused on strategic expansion following its most successful fiscal year ever, with revenue up 36% from the previous year and an impressive $1.8 billion in adjusted net income.
Instead, Live Nation may face the full weight of America’s top law enforcement agency, which this year has taken on companies like Apple and Google with market capitalizations that are each 100 times larger than Live Nation’s. While Kanter’s efforts against these companies have been applauded by powerful allies including Senator Amy Klobuchar (D-Minn.), who has vowed to “make antitrust sexy again,” Kanter’s efforts so far have been unsuccessful, with the DOJ losing the bulk of the major antitrust cases it has filed. In December 2022, a judge dismissed the DOJ’s efforts to block a merger between security firms Booze Allen Hamilton and Everwatch as well as mergers between UnitedHealth Group and Change Healthcare, U.S. Sugar Corp and Imperial Sugar, Meta and Within, and Microsoft and Activision.
Kanter also lost a major ruling in the DOJ’s antitrust case against Google earlier this year when a judge struck down a request to bar the tech giant from offering up evidence that activities the government had deemed anti-competitive also had positive qualities that improved the product and generated positive consumer feedback.
“If the government can tip the scales and prevent courts from considering pro-competitive effects, the government could win every case by default,” wrote Sean Heather, a senior vp at the U.S. Chamber of Commerce, in a recent paper on the Google case.
The Google litigation, which deals with ongoing business practices at the company as opposed to a merger, could be a litmus test for a yet-to-be-filed Live Nation suit. In the Google case, the government alleges that the company controls 90% of the online search advertising market by paying out billions of dollars each year to companies like Apple and Samsung to be the default search engine on their computers and smartphones.
While Live Nation officials are confident they can prevail in the looming antitrust case, they will do so with far fewer resources than other companies hauled before the Justice Department in recent years. Live Nation’s market cap currently sits at $22 billion, whereas Google and Apple’s combined market cap is $6.7 trillion, making Live Nation one of the smallest companies in recent decades to be the subject of such a lawsuit.
Live Nation declined to comment for this story. The Department of Justice did not respond to requests for comment.