The US Department of Justice (DOJ) has filed a competition lawsuit against Live Nation.
The civil case will challenge the Ticketmaster parent company over its impact on competitors and customers, including allegations that it weakened choice and pushed up prices.
According to a statement by Merrick Garland, US attorney-general, “fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters get squeezed out, and venues have fewer real choices for ticketing services It is time to break up Live Nation-Ticketmaster.”
The federal government’s civil case will be accompanied by action at the state level.
It follows a lengthy investigation into the live music giant’s business practices by the DOJ’s anti-trust division.
The company has faced criticism from artists and fans over ticketing fees, while Live Nation had to apologise during a Senate Judiciary Committee for the Taylor Swift Eras Tour ticketing debacle.
“The live music industry in America is broken because Live Nation-Ticketmaster has an illegal monopoly,” said Jonathan Kanter, head of the DoJ’s antitrust unit.
In a lengthy statement, Dan Wall, executive vice president, corporate and regulatory affairs, Live Nation Entertainment, claimed that there had been "intense political pressure on DOJ to file a lawsuit, and a long-term lobbying campaign from rivals and ticket brokers seeking government protection for themselves".
"It is also absurd to claim that Live Nation and Ticketmaster are wielding monopoly power," added the statement from Wall. "The defining feature of a monopolist is monopoly profits derived from monopoly pricing. Live Nation in no way fits the profile. Service charges on Ticketmaster are no higher than elsewhere, and frequently lower. And even accounting for sponsorship, an advertising business that helps keep ticket prices down, the company’s overall net profit margin is at the low end of profitable S&P 500 companies."
Live Nation Entertainment was created by the merger of the promoter with Ticketmaster in 2010. The deal was passed by the DOJ despite concerns about competition.
Following news of the expected legal action, shares in Live Nation fell by more than 6% in after-hours trading.
