Canadians could enjoy the benefits of a United States Senate committee’s work if it results in changes being forced upon Ticketmaster, says one expert.
A Senate Judiciary Committee in Washington is looking into the ticket-vending giant’s dominance in the industry, with some suggesting the U.S. government force the company to split up, 13 years after Ticketmaster and concert promoter Live Nation merged.
“The fact of the matter is, Live Nation/Ticketmaster is the 800-pound gorilla here,” said U.S. Sen. Richard Blumenthal said during a hearing Tuesday. “This whole concert ticket system is a mess, a monopolistic mess.”
Ticketmaster is the world’s largest ticket seller, processing 500 million ducats each year in more than 30 countries. Around 70 per cent of tickets for major concert venues in the U.S. are sold through Ticketmaster, according to data in a class-action lawsuit filed by consumers last year.
Fans and artists have alleged that the company’s comfort as the dominant player in its industry has resulted in it taking customers for granted and exploiting entertainers.
If the U.S. government takes action to clean up the alleged “mess” it could pay off for Canadian customers, said Vass Bednar, the executive director of the master of public policy in digital society program at McMaster University.
The benefits could include more transparency in ticket purchases, paying less for tickets and fewer opportunities for ticket scalpers, Bednar suggested.
“If there ends up being significant changes to the structure of the company or their business practices, that would have spillover effects to Canada,” she said. “I can’t see how any changes would be limited to the U.S.”
The committee was sparked last November when Ticketmaster’s site crashed during a presale event for the upcoming Taylor Swift tour. According to the company, bots attempting to buy tickets to resell them and a rush of fans led to a malfunction which resulted in thousands of people losing out on tickets after they had waited hours in an online queue.
Live Nation’s president and chief financial officer Joe Berchtold apologized for the incident and promised to improve service. The company said it has already spent $1 billion over the last decade on security enhancements.
Berchtold also agreed that the industry should be more transparent about fees and said authorities should concentrate more on fraudulent practices, such as resellers offering tickets that haven’t officially gone on sale yet.
But senators weren’t in the mood to praise the company efforts. Republican Marsha Blackburn said banks and power companies are also frequent targets of bots but don’t suffer service meltdowns.
“They have figured it out but you guys haven’t? This is unbelievable,” Blackburn said during the hearing. “We’ve got a lot of people who are very unhappy with the way this has been approached.”
Other senators talked about fees charged by the company, which are sometimes as high as 75 per cent of the ticket’s face value and average 27 per cent their value.
Ticket reselling was also an issue raised during the hearing. In 2018, a Star-CBC joint investigation revealed Ticketmaster was looking to do business with those reselling tickets rather than actually making concerted efforts to stop them.
The company was also made to pay $4.5 million penalties and costs in 2019 after a Canadian Competition Bureau investigation about misleading prices.
A competitor of Ticketmaster’s, SeatGeek CEO Jack Groetzinger, told the committee even if Live Nation doesn’t own a venue, it stymies competition by signing arenas and concert halls to multi-year contracts to provide ticketing services; if those venues don’t agree to use Ticketmaster, Live Nation may withhold the acts it’s promoting.
“The only way to restore competition is to break up Ticketmaster and Live Nation,” Groetzinger said.
Ticketmaster did not reply to a request from the Star for comment and details regarding its Canadian operations Tuesday.
Bednar said it’s encouraging to see U.S. officials taking a look at the company and “regulators are asking whether Live Nation has abused its power over the live music industry and whether they have a ticketing monopoly,” she said.
Meanwhile in Canada, an appeal court decision upheld on Tuesday the $26-billion Rogers and Shaw merger, striking down an effort by the competition bureau to stop the telecoms’ nuptials.
Bednar said the committee in Washington is an example of how Canada often piggybacks on foreign governments’ decisions on such competition issues. She added that Canadians seem to be getting fed up with this country’s long history of letting big Canadian companies rule the roost.
“We’re having more of a moment for competition in Canada where people aren’t accepting our lack of dynamism as part of our heritage any more,” she said. “People are angry, more angry at the grocery stores and telecoms, but the lack of competition in Canada goes beyond grocery, telecom, banking, airlines.”
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