SXSW 2011: Live Nation-Ticketmaster merger, a year later
AUSTIN, Texas -- So how's that Live Nation-Ticketmaster merger working out? Representatives of the music industry, including Ticketmaster CEO Nathan Hubbard and an attorney for the Department of Justice, showed up Friday at the South by Southwest Music Conference to discuss the biggest music business story of the last decade.
In general, the discussion was low-key and free of invective, even though a number of panelists had reason to feel otherwise, including independent promoters whose livelihoods are threatened by a Live Nation Entertainment conglomerate that dominates music ticketing, arena and stadium-level concert promotion, and manages some of the top acts on the circuit. Despite all signs pointing to a monopoly that could raise ticket prices, and ruin or at least undermine countless independent businesses, the Ticketmaster-Live Nation merger was approved last year.
Though ticket prices have not skyrocketed and independent promoters such as Chicago-based Jam Productions and Los Angeles-based Mitchell Frank, who were represented at the panel, are still in business, it's too early to gauge the merger's impact, Chicago booking agent David Viecelli of the Billions Corporation said. "The threat of consolidation has yet to be realized," he said. "There are a lot of people in the industry who want to get their hands on ticket fees and surcharges, and it's not a good situation. The concert industry needs to be stripped down and rebuilt" rather than consolidated.
The slumping economy has forced promoters to tow the line on ticket prices, but that may not last as Ticketmaster moves to an open-market pricing model where ticket prices rise or fall depending on demand. The system will reinforce a hierarchy where only the wealthiest fans will be able to afford the best seats, Hubbard acknowledged.
But the Ticketmaster CEO insisted that the merger has been good for consumers in that it has allowed the company to build in greater efficiencies in the way it sells tickets. "Ticketmaster satisfaction is at an all-time high," he said, bringing chuckles from more than a few in the audience. He also deflected concerns that Ticketmaster is now able to share information about competitors with Live Nation by saying, "We talk to the Department of Justice every week about this issue, and we take it very seriously."
John Read, a Justice department attorney, confirmed that his department monitors compliance of the merger terms daily, which suggests an enormous amount of resources are being expended to make sure Live Nation Entertainment isn't gaining a competitive advantage.
"We haven't seen the big disaster" that some merger critics predicted, Read said. "Ticket prices have not gone through the roof. It's still early but so far things are OK."
Read also said that the Justice department has received "several complaints" about how Live Nation Entertainment does business, and each is being investigated. "We have not sued them yet for contempt," he said. Looking up at the audience he added, "The key to this (working) is to get information from you all" on how Live Nation does business.
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