A US court has handed down a decision that could change the way the industry operates in the long term concerts. After several years of audience complaints about high ticket prices and additional fees, the jury found that the Live Nation and Ticketmaster companies abused their dominant position and practically established a monopoly over large concert venues in United States of America.
A federal jury in New York found that Ticketmaster charged customers in 22 states about $1,72 more per ticket, AP writes, which a judge could order to be refunded. Such a decision could cost Live Nation hundreds of millions of dollars. Although the individual sum appears to be negligible, its cumulative effect on the millions of tickets sold reveals the extent of systematic overpayment that significantly affected a large number of customers.
"The jury found what we've long known to be true: Live Nation and Ticketmaster are breaking the law and costing consumers millions of dollars in the process," New York Attorney General Lettisha James said in a statement, according to Reuters.
"The verdict of the jury is not the last word in this case," the company Ticketmaster quickly responded.
For millions of music fans, this sounds like a long-awaited victory. However, the reality is somewhat more complex - tickets will not get cheaper immediately, nor will the additional fees disappear overnight. The ruling is just the first step in a process that could take years.
Photo: Pixabay/ActivediaA US court has made a decision that could change the way the concert industry works in the long run
Vertical integration
The crux of the problem lies in the way the entire industry is organized. Live Nation, which still denies that it has a monopoly position, not only organizes tours of leading artists and manages a large number of concert facilities, but through its Ticketmaster platform it controls the sale of tickets in more than 200 halls in the USA, which practically covers the entire chain - from performers to the audience.
Economists call this model aggressive vertical integration, because it combines different stages of the same business process into a single corporate structure. In this case, it's not just a partnership, but a powerful company, Live Nation Entertainment, created by the merger of these two giants in 2010.
This company has a strong and widespread influence on the European live music market as well, with control over the organization of the biggest concerts and festivals, as well as the sale of tickets for key concert venues throughout the United Kingdom, Germany, Italy and other parts of the continent. As far as our country is concerned, when big international artists (often under management or on tours organized by Live Nation) perform in Serbia, tickets are usually sold through local platforms and distributors.
No realistic alternative
The lawsuit against the giant, originally launched by the former US administration of Joe Biden, accused Live Nation of stifling competition and preventing concert venues from using multiple different ticket sellers. The court has now found that such a practice did indeed restrict competition. Event organizers often had no real alternative, while consumers were left facing ever-higher prices and unclear additional costs.
The so-called "dynamic pricing" model, in which the price of tickets changes in real time depending on demand, caused particular frustration among fans. In practice, this means that the same ticket can increase in price multiple times within a few minutes, which many see as a hidden way to extract the maximum amount of money from the audience, without clear rules and transparency.
What follows will be a key part of the process. The court has yet to decide on penalties, which could include huge financial penalties, but also more serious measures – such as forcing the company to sell part of its business or even separating Ticketmaster from its parent company. Such a move could change the market the most.
Live Nation estimates that the damages it would have to pay in this case would be "less than 350 million dollars", and in a statement, reported by Reuters, it states that it believes that the final outcome "will not be significantly different" from the settlement it reached during the trial with the US Department of Justice. The company previously announced that it had already set aside $280 million for a settlement with the federal states.
If the monopoly is broken or Ticketmaster's dominance in the market weakens, the door would be opened for tougher competition. Platforms like SeatGeek, Eventbrite or AXS could gain a bigger role in ticket sales for major events, which could lead to lower fees and more transparent pricing in the long run. In media analysis, it is often pointed out that this case is not only a question of ticket prices, but also a broader question of control of the cultural market and the concentration of power in the entertainment industry.
A precedent in the entertainment industry
However, experts warn that the price of tickets does not depend only on sales platforms. A large part is determined by the contractors themselves, and there are also the costs of production, marketing and space rental. Therefore, a dramatic drop in prices is not expected, but a fairer system is expected in which the audience would know exactly what they are paying for.
This ruling has wider significance outside the music industry. It sends the message that large companies that control entire markets will come under increasing scrutiny. At a time when a few players dominate various sectors of entertainment and technology, decisions like these may set a precedent for some future cases. For now, fans of concerts and music can breathe a sigh of relief - only symbolically.
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