Taylor Swift and the Ticketmaster monopoly, explained

There’s something deeply wrong in Taylor Swift’s America.

Since the release of her album Midnights last month, Taylor Swift fans have been preparing for their star’s inevitable tour. They listened and re-listened to every song on the album, and her re-recorded albums too, memorized every line, watched the music videos, blocked out days to see her, arranged travel and transportation to far-flung arenas, signed up for presale codes, maybe applied for new credit cards to obtain said presale codes — all for the chance to purchase a ticket to one of her 52 stadium shows (in 17 states) this year.

Over the past week, that giddy anticipation liquefied into bleak, resentful disappointment as tickets became increasingly difficult to purchase.

According to Ticketmaster, there were approximately 14 million users on the site at once during the presale push, and the company sold 2.4 million presale tickets. The fans that got through — via a system of presale codes and designated purchase times — ran into numerous malfunctions, some being told to wait hours to be able to spend hundreds of dollars on seats.

Ticketmaster said on November 17 that it would not even be selling tickets to the general public. Millions of devoted fans were shut out of buying tickets altogether.

On the surface, the problem looks like a classic case of Ticketmaster not being able to keep up with the demand. Swift issued a statement on social media saying that she and her team asked Ticketmaster repeatedly if they could handle the volume and intensity of her fandom, and compared the ragged experience to “several bear attacks.”

Krista Brown, a senior policy analyst at the American Economic Liberties Project (AELP), explained to me, this Swift failure is a symptom of a bigger problem. The AELP is a nonprofit, non-partisan organization that focuses on dismantling monopolies and lobbies to assert antitrust laws. It’s part of a coalition of organizations called “Break Up Ticketmaster” that seeks to undo the 2010 merger between Ticketmaster and concert promotion company Live Nation. Brown explains that merger gave Ticketmaster a virtual monopoly over ticket-buying consumers, artists like Swift, and the venues where they play.

This week, the New York Times reported that the Department of Justice is reportedly going to open an antitrust investigation into Ticketmaster. In 2019, Ticketmaster’s parent company Live Nation agreed to settle with the DOJ over antitrust violations and extend terms of its regulatory decree (basically, a set of antitrust agreements that the DOJ made Live Nation promise to abide by in order to allow the merger happen).

Thanks to a web of exclusivity contracts with artists and venues, consumers usually have to go through Ticketmaster to see the artists they want to see. Artists face limits too, as many arenas and stadiums have Ticketmaster exclusivity deals wherein playing at a venue means using Ticketmaster as their vendor. Usually, a company doesn’t just go around upsetting its base with website crashes, absurd ticket pricing and fees, and being shut out of tickets; consumer loyalty matters to most corporations. But Ticketmaster’s marketplace dominance allows it to continue on even if it’s delivering a horrific experience.

“We don’t go back to bad restaurants. If you have a bad restaurant experience, you leave because there’s 20 others that you can go to,” Brown told me. “But when you go to Ticketmaster, you prepare for a horrible experience. And you are also prepared to have to do it again and again.”

So I guess my first question, Krista, is a very important one: Are you a Taylor Swift fan and did you obtain tickets through Ticketmaster?

I am a distant fan. I was never attempting a ticket. But I will say my colleague was and had the most frustrating sales experience. She never ended up with a ticket and spent the entire day in queues. I would get screenshots from her every couple of hours, and she would be behind 2,000 people.

Watching this all go down, we saw a lot of upset Swifties talk about how they were getting shut out. Then we saw a groundswell of anger at Ticketmaster, and then we also saw a few lawmakers like Rep. Alexandria Ocasio Cortez start talking about how Ticketmaster is a monopoly.

When I hear that, the consumer in me just sort of assumes that tickets are hard to get. But I know it’s more than that, right? Ticketmaster has an unusual stranglehold on ticket sales. When someone says “Ticketmaster is a monopoly,” what does that mean?

As a fan, the first thing is that [dealing with a monopoly] is going to be a bad service and a bad experience. Obviously, the Taylor Swift fans can speak to that. Ticketmaster’s control of the market makes them a single supplier. Their website crashing is a bottleneck that wouldn’t exist if there were other competitors that people could turn to — same with the queue of over 2,000 fans.

Taylor Swift at AT&T Stadium in 2018 during her Reputation tour. To get a ticket to her tour this year, one would have to go through Ticketmaster.
Matt Winkelmeyer/TAS18/Getty Images for TAS

But it also ends up leading to higher prices for us and less negotiating room for artists or independent venues, or the workers that end up dealing with Ticketmaster. That’s generally the piece that as customers we don’t think about as much. Because it’s just Ticketmaster’s ability to leverage their power and say, “we have deals with almost all of the largest venues and the venues that will fit Taylor Swift fans, we can pretty much demand whatever we want.”

And that’s not to say that artists hate them. I think the biggest artists probably have pretty good contracts. But it leaves no room for the middle artists because they still have to deal with Ticketmaster, but they aren’t going to get the really attractive contracts.

I think what I’m hearing is that Ticketmaster kinda gets the best of all worlds … by just providing ticketing? Like they cash in on artists. They cash in on fans. They cash in on venues. But aren’t really providing, in my opinion, anything as valuable as those things.

They, you know — they have the ticketing software.

Oh well, thank god for ticketing software!

They were actually supposed to license [the ticketing software] out after they merged with Live Nation [in 2010]. But it is crazy that that merger happened because it allows them to be the biggest ticket seller, biggest concert promoter, and have exclusivity with the majority of the high-capacity venues.

They can extract money from every angle, and they do.

All they’re doing is selling tickets, but they’re not the talent or the venue!

And they sell those tickets badly!

You mentioned Live Nation, which I think is important for normies or anyone who doesn’t really understand where this industry power came from. Ticketmaster has always, to me, been this shitty service. But I think that merger is where Ticketmaster went from a shitty service to a monopoly.

Can you explain why that merger with Live Nation is important?

Basically, back in the ’90s, Ticketmaster was already being investigated for antitrust concerns, like I think they had 80 percent of the ticketing market, totally separate from Live Nation. Live Nation also had a probe, the Department of Justice investigated them in the early 2000s for buying up all these regional concert promoters. Both separately had a ton of power, but they weren’t like an integrated service.

Prior to the merge, there were probably a lot of behind-the-scenes discussions of how to not actually compete with each other. [That solution] was “let’s just all be on the same side and merge.”

Ticketmaster, the bane of Taylor Swift fans’ existence.

What a lot of fans don’t think about is that they created a really vertically integrated system where the service that we use for ticketing not only owns the majority of that market, they have exclusive contracts with at least 70 percent of the sports arenas that we go to, like the NFL stadiums. They have contracts with the biggest artists that we all love, many of them they promote.

Can I stop you there and just ask what these contracts entail?

Of course, all those contracts all look different. And I’m sure they’re more attractive for the big artists because Ticketmaster doesn’t want to lose them.

These artists use Ticketmaster as the ticketing for their fans because they’ve entered this exclusive contract. The venues they go to are also under exclusive contracts.

And that merger allowed the company to push out what would be any other competition, at any of those levels.

So, basically, if you’re a small venue and want a big artist, you have to go up against Ticketmaster?

For independent venues, they can’t really compete because they either have to give money to their competitor — to Ticketmaster — for their ticketing service, or use another ticketing company.

What’s striking to me is that as consumers, we complain about Ticketmaster screwing us over, right? Like, no customer has had a good experience with Ticketmaster. But from talking to you, it seems like Ticketmaster can assert its dominance on the artist side.

Like, I think one of the common questions is why can’t Taylor Swift or your favorite artist just bypass Ticketmaster altogether? And the answer seems to be, okay, they can try, but good luck with that. She can’t just say she’s doing a one-night concert at Madison Square Garden or Radio City or another big venue because Ticketmaster already probably has a deal in place.

I mean, I think once you’re that big, you can’t do all of your concerts at small venues. Like you cannot fit every fan in a small venue.

The second that she enters the sphere of high-capacity venues, those venues are in exclusive contracts. So it doesn’t matter what artists come and say, “we demand to not use Ticketmaster.” Ticketmaster has the venue and the venue has its hands tied.

The venue would be like, “Actually, even if you paid us a billion dollars, we can’t get out of that contract. So you can’t perform here.”

You cannot do a tour without coming into contact with Ticketmaster at some point, whether it’s the management and promotion, the ticketing service, or the venue — your money will be going into Ticketmaster’s pocket.

We’ve gone over how much power Ticketmaster has. I think the sensible question is what can regular people do about the monopoly? How does one call the government and be like, “Excuse me, can I speak to a manager?”

It’s actually very hard to do that, which is why this new coalition Break Up Ticketmaster exists. It simplifies the process of expressing your harms. Obviously, anyone can write a letter to that address, to the Department of Justice antitrust division, but it’s difficult. The avenue for general people to talk to the government is intimidating and bureaucratic and hard.

We launched Break Up Ticketmaster to help people to say, “This company is horrible.” Our argument is that they have too much market share. And they therefore are a monopoly. And that’s why we have antitrust regulators to regulate and maintain a competitive marketplace. We created a form to automatically send these emails to the DOJ.

The Federal Trade Commission is also a regulatory agency that deals with antitrust. They have this law, Section Five, that allows them to enforce antitrust laws, and they have public comment openings often throughout the year.

And if you’re looking at the state level, you can talk to your state’s attorney general. Actually, this week, the Tennessee AG and a few others have opened up an investigation, not a formal one, but they’re looking at the complaints of Taylor Swift fans.

Okay, so let’s say we get our wish. The DOJ said they would be investigating Ticketmaster, what’s the best-case scenario?

In an ideal scenario, the Department of Justice would file a formal complaint and allege a Sherman Act violation, which is just accusing Ticketmaster of monopolization. And that would then go to court. I think Ticketmaster would probably try and settle. And that has been how a lot of cases go.

Ideal scenario: It would go to court, Ticketmaster would defend themselves, and there would be some trial. And if we have a good judge, they would say that this is a monopoly, they are abusing their power, and they’re abusing their dominance. And thus, we will unwind this merger, because the integration of their power with Live Nation attached to Ticketmaster is just too much for the marketplace.

The result would be a spinoff to two separate companies again. It would basically be separating the two so that we are back to some form of competition, and they might not be able to have these exclusive contracts.

And what does that look like for a consumer? Why is competition good for consumers who are looking to buy tickets?

From what I can glean, there would be a much more flourishing venue scene. Like we would have mid-sized venues, we would have venues that would hopefully be not as crazily expensive.

It would decrease the fees that we see on all of our tickets, it would also likely decrease the price of the face-value ticket. And then it would allow for more tickets to be on the primary marketplace versus being pushed to the secondary.

You would probably see higher wages for the people that are actually working within that sphere. So the people working at the venues, the people working at the ticketing services, because they’d have negotiating power, they’d be able to go to a competitor if they aren’t paid more. Currently, they don’t have that leverage.

Taylor Swift accepts the “Tour of the Year” award in 2019.
Kevin Mazur/Getty Images for iHeartMedia

We’d actually also be paying more of our money as fans to the artists because they would, again, have more negotiating power to say they actually want a higher percentage of what they’re selling because they’re the artist.

And, baseline, we just would get better services. There would be a pressure on Ticketmaster to continue to invest in the infrastructure so that there aren’t these random crashes. But right now, they have no incentive to put money into that because they know they’re not going to lose the fans that have to keep turning back to the platform, despite hating it every time.

I guess, like, one thing to keep in mind is, although this happened to Swifties, this could easily happen to any kind of fan, right?

It’s not a one-off instance with Taylor Swift. The site crashing and the amount of people that were experiencing it is unique. But the failures on Ticketmaster’s part happen every day.

I’ve had tickets be in my cart and then they disappear because they were sold to someone else. I shouldn’t have that bad experience where I’ve committed a certain level of my attention to trying to buy this thing. And then extra fees are tacked on or the [high price of the] ticket. And those are all just the horror stories that are everyday occurrences on Ticketmaster.

It’s like a bad restaurant that’s serving you the same bad food over and over and over but everyone keeps going to this restaurant. And you’re all competing for one seat at this bad restaurant.

And we’re also paying so much for this terrible food or terrible time.

Awful.

If we didn’t have monopolies, that wouldn’t be the case.

Just give us the option to get less terrible food somewhere else.

We would have better food, it would be cheaper. We would actually have a good experience because they would probably be paying their people well, so they’d have happier employees. All of it would be better!

Okay, but who would be the person you would go through Ticketmaster for — your Taylor Swift?

Maggie Rogers! And she’s already come out and said, “Fuck Ticketmaster.”

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