Yesterday afternoon, news broke that the Department of Justice had settled with Live Nation on an investigation that people were just getting wind of this week.
The timing and the nature of the deal seem a little odd on the surface considering folks were just finding out about the investigation on Monday or towards the end of last week…and the deal was done on Thursday.
I’ll need some time to process this whole situation, but I have a few thoughts that immediately come to mind.
1. This deal doesn’t necessarily mean that Live Nation is in the clear:
I’m not an antitrust attorney and I’m no legal scholar, but it is unlikely that this deal eliminates the possibility that if Live Nation can now do whatever they want.
In fact, this might be a signal that the federal government is going to spend more resources on paying attention to the world of tickets. And, that more attention was part of the reason that Ticketmaster and Live Nation got off with a smaller than expected punishment.
2. The extension of the consent decree signals that there were some misdeeds going on:
You don’t find yourself under a consent decree without some cause or concern about the nature of your business.
And, you don’t find yourself under a publicly announced investigation without having done something that skirted or crossed a line that the government placed for you.
What is the nature of these misdeeds?
I don’t know for certain.
But what I do recognize is that these misdeeds were considered severe enough that the DOJ thought that they should continue to keep Live Nation under a decree for 5 years.
While I’m not sure that this will alter any potential misbehaviors from Live Nation, it could mean that understanding that the original decree wasn’t complied with as diligently as the government desired that the government will be much more likely to keep an eye on the company moving forward.
3. What will be the unintended consequences of this deal?
Every deal, no matter what sector it happens in, has unintended consequences.
What will be the unintended consequences of this deal?
Will the government be more willing to bounce the Viagogo and StubHub merger?
Will more companies try to consolidate as a way to gain a market advantage?
Will Live Nation become more aggressive in their business practices?
All kinds of unintended consequences could occur.
4. This deal sheds light on the ticketing ecosystem at large, warts and all:
What is the saying about sunlight being the best disinfectant?
I guess we will see if that is true.
There are tons of positives about the entertainment business like the number of tickets sold, advances in technology, and the way that entertainment and sports bring folks together in a way that many things don’t today.
But, just like customer service, we never really hear anything unless something goes wrong…the same goes for the world of tickets.
And, in this case, we are seeing that the way that the world of tickets is laid out isn’t working very well for consumers and consumers are starting to stay away.
We have seen situations where customers have been banned for reselling tickets, had tickets canceled due to shifting of ticket limits, had customers deal with burdensome tech issues and much more.
Combine this with fees, uncertain on-sale dates, more competition for entertainment dollars, and countless other factors and we see an industry that is ripe for disruption because the industry has some serious issues that need to be addressed like declining attendance, pricing out consumers, and more.
I’ll jot down some more thoughts over the next few days, but I think 3 takeaways that are going to stick with me are:
- It will pay to pay attention to what the government does in 2020. Tickets are an easy target in an election year.
- I’d be surprised if Live Nation is truly out of the woods.
- I’m going to keep an eye out for the unintended consequences likely to pop up due to this deal.
What do y’all think?
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