Taylor Swift Ticketmaster Meltdown the Topic on Capitol Hill This Week
Ticketmaster and its partner Live Nation, Inc. came under fire this week as lawmakers grilled a top executive for the company in a hearing on Capitol Hill. Live Nation president and CFO Joe Berchtold appeared in front of Congress to answer questions regarding the massive meltdown when tickets for the Taylor Swift “Eras” tour went on sale last November. Here are a few things to know about the debacle and what came out of the hearing.
Why is Ticketmaster Being Questioned?
The three-hour hearing came about after millions of Swift fans were shut out of tickets for the upcoming tour, set to kick off this March. Tickets first went on sale to those holding a special pre-sale code that had been distributed to select verified Ticketmaster users. However, despite holding a code, hordes of fans were unable to secure tickets after the Ticketmaster site could not handle the demand. The site repeatedly crashed during the middle of transactions and even canceled some purchases.Read More »
This week’s hearings were also prompted by dozens of Swift fans that went so far as to sue Live Nation for “unlawful conduct,” saying that the ticketing retailer violated the nation’s antitrust laws.
Ticketmaster Puts Blame on Bots
During his testimony this week, Berchtold put the blame on the high number of bots that flooded the system during the initial pre-sale. According to Berchtold, the site experienced three times the highest amount of bot traffic previously seen by the retailer. This immense activity necessitated that Ticketmaster slow down and even stop the sale of the tickets, triggering widespread disruptions to consumers trying to secure their coveted seats.
Those questioning Berchtold pushed back on his blame on the bots. For instance, Republican Senator Marsha Blackburn said that Live Nation needs to boost its cyber protections in order to protect the site from bot infiltrations. Republican Senator John Kennedy also strongly criticized the company’s handling of the Swift tour ticketing, suggesting that whoever was in charge should be fired.
Berchtold also used his time on Capitol Hill to defend the practices of Ticketmaster. He reminded lawmakers that the company does not set specific prices nor does it determine how many tickets will be sold for each event. Berchtold also said it is the individual venues that determine the service and ticketing fees.
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The company has continued to defend against accusations that Live Nation’s dominance of the industry gives it freedom to set prices at will. Berchtold told lawmakers that Live Nation only controls approximately 200 venues across the country, equating to about 5% of the market. He added that the Live Nation venues set fees that are in line with what competing venues set.
The Bottom Line
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Despite the three hours of questioning, there were no real solutions offered to the growing problem. Democratic Senator Amy Klobuchar pointed out that many of the issues could be solved with the right legislation that breaks up these monopolies. However, it will be up to the U.S. Department of Justice (DOJ) to decide if Live Nation is a monopoly by pressing for an antitrust suit.
In addressing the group gathered at the hearing, Kathleen Bradish, vice president for legal advocacy at the American Antitrust Institute, reaffirmed that it was the customers who pay the price for these monopolies. These prices come in the form of higher fees and ticket prices paired with less choice and a lower quality product.
What was most notable to many political watchers is that the issue brought together both Democrats and Republicans. Both parties are in agreement that there needs to be better oversight to prevent these ticketing debacles from happening again.
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