September 28, 2009
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Washington, DC — Several national consumer organizations have written to the Department of Justice opposing the Ticketmaster-Live Nation merger, arguing that it would turn the “already questionable ticket selling industry into an even less competitive environment for consumers.”
The three groups signing the letter – the National Consumers League, Consumer Federation of America and Consumer Action – are concerned that the companies individually already own extremely large shares of the sectors in the live entertainment event industry, and that the merging of these two giants should be closely and skeptically reviewed under anti-trust law. This could turn the already questionable ticket selling industry into an even less competitive environment for consumers.
“Buying tickets to live performances in today’s marketplace is fraught with pitfalls for consumers. Tickets are put on the secondary market routinely – and marked up two to three times their value before consumers ever have a chance to buy them at face value. There is no transparency in the market, and this merger would only make the problem worse,” said Sally Greenberg, Executive Director of the National Consumers League.
“If allowed to merge, these firms would control so much of the music marketplace that no one could stop them from raising ticket prices and service fees, meaning fans would pay,” said Linda Sherry, Consumer Action director of national priorities. “No single company should have that much control over access to live entertainment.”
The letter opposes the merger on two grounds:
First, the groups say the merger would create a “virtual monopoly in the ticketing industry.” Some industry experts estimate that Ticketmaster, which has secured its place in the market through long-term contracts with its clients, controls up to 70 or 80 percent of all concert ticket sales. Live Nation, which entered the ticket-selling market in early 2009, “has already demonstrated its potential to become Ticketmaster’s only significant competitor.”
Second, the letter states that the merger would “create a massive entertainment giant, Live Nation Entertainment, which would hold significant market shares in the artist management, venue operation, event promotion, ticketing, and secondary ticketing sectors of the live entertainment event industry.”