Suing Ticketmaster and Live Nation for "monopolizing" concert markets, Justice Department alleges threats to Barclays Center, which ended SeatGeek deal.

A new federal lawsuit against Ticketmaster and concert promoter Live Nation could lead to lowered ticket costs for fans at venues like the Barclays Center, as well as increased revenues for those venues.

Let's back up. In early 2023, the New York Times broke the news (link) that Barclays, barely 15 months into a 7-year contract with ticketing partner SeatGeek, the Barclays Center would return to its original one, Ticketmaster, the industry leader.

Less than two weeks later, a Senate hearing focused on the reputed ill effects of Ticketmaster's huge market share, given its shared ownership with the concert promoter Live Nation.

At the hearing, SeatGeek CEO Jack Groetzinger revealed that Barclays had sought to keep SeatGeek--an upstart company that prides itself on innovations like 3-D views from seats and a mobile-first approach--to ticket Brooklyn Nets games while returning to Ticketmaster for concerts, a strong suggestion that they believed restoring the connection was needed to book shows.

That didn't happen. An alternate take, from Billboard, cited problems in selling tickets to certain concerts.

Billboard suggested that the Department of Justice would be looking into the Barclays switch in its analysis of the Ticketmaster-Live Nation merger.

New lawsuit

Indeed, that shoe dropped May 23, as DOJ announced,

The Justice Department, along with 30 state and district attorneys general, filed a civil antitrust lawsuit against Live Nation Entertainment Inc. and its wholly-owned subsidiary, Ticketmaster LLC (Live Nation-Ticketmaster) for monopolization and other unlawful conduct that thwarts competition in markets across the live entertainment industry. The lawsuit, which includes a request for structural relief, seeks to restore competition in the live concert industry, provide better choices at lower prices for fans, and open venue doors for working musicians and other performance artists.

“The live music industry in America is broken because Live Nation-Ticketmaster has an illegal monopoly,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “ 

Here's a press release from New York State Attorney General Letitia James, which notes that Live Nation "owns, operates, or has exclusive booking rights for hundreds of venues nationwide, including New York’s Madison Square Garden, Radio City Hall, Barclays Center, and other venues across the state."

The upshot of a successful lawsuit could mean lower ticket prices for fans, more revenue for venues, more revenue for performers--and less for ticketing companies/promoters.

Behind the charges

The complaint cites, among other things, the company's "longtime relationship with Oak View Group, a potential competitor-turned-partner that has described itself as a 'hammer' and 'protect[or]' for Live Nation; retaliating against potential competitors. Other grounds include:

• Threatening and Retaliating Against Venues that Work with Rivals
• Locking Out Competition with Exclusionary Contracts
• Blocking Venues from Using Multiple Ticketers

Live Nation, unsurprisingly, disagrees. But they'll face a jury trial in a generally hostile environment.

Anti-monopolist writer Matt Stoller, in Antitrust Enforcers to Break Up Ticketmaster and End the "Ticketmaster Tax", noted that "Everyone hates Ticketmaster," from both sides of the aisle. (Read Stoller for the backstory on the "obviously terrible 2010 merger of Live Nation and Ticketmaster.")

Here's a good breakdown on the case from Vulture.

The Live Nation "flywheel"

According to the complaint, "Live Nation uses its concert promotion business—the core of its 'flywheel'—to feed its other high margin businesses, including Ticketmaster’s ticketing business, Live Nation’s network of venues, as well as Live Nation’s sponsorship and advertising business."

In other words, its leadership/monopoly in concert promotion, though a lower margin business, allows control over content that feeds those other higher margin businesses, according to the DOJ.

From Department of Justice complaint

Drilling down to Barclays

A New York Times follow-up, The Emails at the Heart of the Government’s Ticketmaster Case, notes "eye-opening emails that it says were written by Live Nation’s chief executive, Michael Rapino, and other high-powered figures in the concert world."

One example involves “threatened commercial retaliation” against a potential rival. Another involves
Oak View, which called itself a “pimp” and a “hammer” for Live Nation.

And another involves the SeatGeek controversy at Barclays. Though the Brooklyn arena was not named, its identity was confirmed by a Live Nation executive.

DOJ charge: threats to Barclays

From the DOJ complaint (also at bottom), I've excerpted the relevant sections:

For example, in 2021, Live Nation threatened retaliation against a venue that had decided to switch from Ticketmaster to SeatGeek for primary ticketing. That venue had decided to switch, in part, because SeatGeek offered to share a greater percentage of the fees associated with secondary ticketing. 

Upon learning about the potential switch, a senior Live Nation executive texted a not-so-subtle warning to the venue’s CEO: “Apparently seatgeek are telling [nearby venue] and others that they have a contract deal with you guys already?? Anyways should think about bigger relationship with LN not just who is writing a bigger sponsorship check [smile].” A few days later, Live Nation’s CEO emailed the venue’s owner that Live Nation “will be very concerned that seatgeek a secondary provider will be selling our LN artist tickets when not authorized by the artist.”

So SeatGeek apparently offered Barclays a better cut of revenue, but then Live Nation threatened the arena CEO, who was then John Abbamondi. And then Live Nation escalated to the "venue's owner"--er, the owner of the operating company---Joe Tsai.

DOJ charge: re-routing concerts

From the complaint:

Once the venue switched to SeatGeek, Live Nation followed through on its threats, re-routing concerts to other venues. Live Nation’s promotions business also demanded that the venue disable secondary ticketing on SeatGeek’s platform for all Live Nation-promoted concerts, depriving the venue and SeatGeek of secondary fee revenue. 

Note that there's some murkiness to this charge, which would need to be developed with more detail. Yes, the new UBS Arena in Nassau County, farther from the city, got shows that might have gone to Barclays, but another reason might have been the novelty effect of a new arena, plus easier load-in.

Note that Live Nation told the Times, “We categorically deny that any concerts were rerouted to retaliate against their decision to go to SeatGeek.”

DOJ charge: Barclays $ for Live Nation

From the complaint:

Live Nation eventually relented and allowed the venue to enable secondary ticket sales—but only after (a) the venue agreed to split its share of secondary fee revenue (sourced through SeatGeek) with Live Nation, and (b) SeatGeek agreed to change its ticket-buying interface to make it conform, in some respects, to Ticketmaster’s without regard to whether that was what fans or the venue preferred. In particular, Live Nation demanded that SeatGeek change the way it distinguished primary and secondary tickets (to make it more like Ticketmaster) and limit the use of its fan-friendly tool called “DealScore.” Given all of Live Nation’s complaints, which it directed to the venue, it is unsurprising that within about a year, that venue returned to Ticketmaster. 

Yes, Barclays returned to Ticketmaster.

Deal Score, according to SeatGeek, "is a fancy algorithm we created that tells you exactly how good a deal you're getting." It does sound fan-friendly.