Opinion: Should Ticketmaster and Live Nation be allowed to reach the altar?
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If I were one of the most hated brands in America, I don’t think I’d tee myself up as the first test of the Obama administration’s antitrust division. And yet, that’s just what Ticketmaster Entertainment did when it agreed this week to merge with Live Nation. The Justice Department quickly announced that it had begun to review the deal, a move whose alacrity came as no surprise -- as a candidate, Barack Obama had sharply criticized the Bush administration for not taking a harder line on antitrust enforcement.
But would this deal increase either company’s clout in the music industry or deter competition? That’s the question I’ve been struggling with as my colleagues and I on the Times editorial board ponder whether to weigh in. Granted, the public would cheer lustily any move to make life more difficult for Ticketmaster (my suggestion to the DOJ: demand that the companies submit documents electronically, but when they log into the government’s servers, make their sessions time out repeatedly in mid-transmission). But the public’s sentiment doesn’t matter under the law; what matters is the potential impact on commerce and competition.
Many of the concerns voiced about this deal are really just complaints about Ticketmaster and its, ahem, heavy-handed approach to the secondary market for tickets (which it does not dominate) (yet), as well the often outrageous fees it charges on top of a ticket’s face value. And on its surface, this deal would appear to remove a badly needed competitor in the market for ticket sales. But Live Nation has tried to sell tickets only for events at some of its own venues, and it’s had notably poor results. The combination also would bring two powerful artist-management firms together, but there doesn’t seem to be a shortage of alternatives in that field.
In short, although I’m no expert on the live music industry (OK, to pre-empt the obvious Larry Solters retort, I’m not an expert in anything, really), I see only one potentially thorny problem here: by combining Live Nation’s venues with those that Ticketmaster has under exclusive contract, it would make it even harder for a new ticketing company to gain a foothold, let alone compete effectively. Is that reason enough for the DOJ to say no? Are there other issues I’m missing? Or is this really a sheep’s deal in wolf’s clothing? Tell us what you think!
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