Senators question Ticketmaster over monopoly concerns, botched Taylor Swift ticket sale

Transcript

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Geoff Bennett: The U.S. Senate has bad blood with Ticketmaster after the company botched ticket sales for Taylor Swift's upcoming tour.

In a hearing today, the Senate Judiciary Committee hammered Ticketmaster not just for the ticketing debacle, but also for its near monopoly in the live music industry.

The Senate Judiciary Committee today tore into Ticketmaster after the fiasco last fall over Taylor Swift tickets, some senators unable to resist references to her songs.

Sen. Richard Blumenthal (D-CT): Ticketmaster, auto look in the mirror and say, I'm the problem. It's me.

Sen. Mike Lee (R-UT): A lot of people seem to think that's somehow a solution. I think it's a nightmare dressed like a daydream.

Geoff Bennett: The committee called the hearing following public outrage over ticket sales for Taylor Swift's upcoming concert tour.

Thousands complained about being unable to get Ticketmaster site to load. Others couldn't access tickets even though they had a presale code. Ticketmaster ultimately canceled sales to the general public, leaving lots of fans ticketless and angry.

Woman: I have never been more mad at a company than I am at Ticketmaster right now.

MAN: Tickets in the sections that I was trying to get tickets for are now on StubHub being resold for thousands of dollars.

(SINGING)

Geoff Bennett: Ticketmaster blamed the 3.5 billion requests for tickets they received from fans, bots, and scalpers.

Joe Berchtold, President, Live Nation Entertainment: This is what led to a terrible consumer experience, which we deeply regret. We apologize to the fans. We apologize to Ms. Swift. We need to do better, and we will do better.

Geoff Bennett: Critics say the company wields too much control over the live music industry.

Testimony today from Clyde Lawrence, a singer/songwriter in the band Lawrence.

Clyde Lawrence, Singer/Songwriter: Due to Live Nation's control across the industry, we have practically no leverage in negotiating them. If they want to take 10 percent of the revenues and call it a facility fee, they can and have.

Geoff Bennett: Ticketmaster and Live Nation merged in 2010, combining ticketing, artist management, and venues under one single powerful company.

Some Democrats advocated for breaking up the company, saying it violates antitrust laws. You

Sen. Richard Blumenthal: You have clear dominance, monopolistic control. This whole concert ticket system is a mess. It's a monopolistic mess.

Geoff Bennett: While Republicans called Ticketmaster out for subpar service.

Sen. John Kennedy (R-LA): If you care about the consumer, you're going to hold the price down. You're going to cut out the middleman.

Sen. Marsha Blackburn (R-TN): Why is it that you have not developed the algorithm to sort out what is the bot and what is a consumer? Why is it that the bank can do it? As I said earlier, why is it the local power company can do it, but you can't?

Geoff Bennett: Taylor Swift, for her part, has called the ticket buying experience excruciating.

Senator Amy Klobuchar led today's hearing and joins us now live from the Capitol.

It's great to have you here.

And during the hearing today, you said that Ticketmaster, with its parent company, Live Nation, that they are the definition of a monopoly. As you see it, what problems does Ticketmaster's unchecked industry dominance create?

Sen. Amy Klobuchar (D-MN): Well, first of all, you saw it. And it's not just Taylor Swift. And we appreciate her fans being out there with us and making antitrust sexy again.

But it is not just her concerts. It's Bad Bunny's fans. It is Harry Styles' fans. It is Springsteen's fans. Many, many artists and bands throughout time, way back to Pearl Jam, have brought this issue to the forefront.

The other piece about it is ticket prices. A government study found that 27 percent average -- and this was even a few years ago -- were these fees. In the testimony we got today, sometimes, it's 75 percent, 80 percent of the ticket price.

And as you heard from Clyde Lawrence, from a band called Lawrence, that has said maybe one day he will also freeze the Internet, he said that he literally gets only six bucks for an eight-member banned from a lot of these ticket sales.

What's the answer? That's what we were focused on today. And I don't think you could tell if it was Democrats or Republicans asking the questions, because there was so much unity on taking on a company that has a monopoly on ticketing, 70 to 80 percent, depending on how you look at it, does the promotions and, the third part of the triangle, owns the arenas or makes them take three- to five- to seven-year contracts to get their services, acing out any competition.

Geoff Bennett: Well, on that point, you mentioned the dominance that Ticketmaster and Live Nation have.

Should that company be broken up?

Sen. Amy Klobuchar: That is clearly one option here.

And it worked with AT&T. We got better long distance rates and a brand-new cell phone industry that brought people's prices down. It could work here. 2010, I voiced concerns about this merger back then. And it's something that Justice Department, I'm sure, will be looking at.

The other pieces of this will be legislation to at least make sure that we have transparency on these fees, and that the fan experience doesn't involve getting on the site, and then the price ticks up as they get to the end of purchasing their ticket, speculative tickets that people are trying to sell that aren't even there.

But for Ticketmaster and Live Nation just to blame everyone else, whether it's the bots or whether it's a cyberattack, makes no sense, when they have this extreme monopoly power.

And the purpose of this hearing, I think we accomplished it, get the public some knowledge, get some under-oath testimony from both people who want to see change and Ticketmaster for the Justice Department to use, and find some bipartisan support with our colleagues to move forward.

Instead of just throwing popcorn at CEOs, I think it's time for action.

Geoff Bennett: Ticketmaster came to today's hearings -- hearing with some suggestions for how to improve the ticketing marketplace. They say they want better enforcement of existing anti-bot legislation. They want to ban speculative selling. They want to ban Web sites that deceive consumers.

They want to mandate all-in pricing, so that fans can see the full cost of their tickets. Why is that insufficient, from where you sit?

Sen. Amy Klobuchar: Well, first of all, there was a lot of support for some of these changes. And I think they have also intimated that they'd make some changes, at least the band member that was one of the witnesses

That aside, of course, it's not enough, because they still have this monopoly. Arenas have told us and we heard testimony today that they're actually afraid to use other competitive services, because then they won't get the acts.

And you also have the fact that we still have the fan experience of having to pay for all these fees and the fiasco when there is no one else to go to. So that's why the Justice Department is reportedly investigating this. Our information will help them greatly in that investigation.

And it's also why we need to look at legislation beyond this. I believe we need to strengthen our antitrust laws overall; 75 percent of American industries, we have seen more consolidation, from caskets to cat food. And if we are just to accept these conservative court decisions that narrow the use of the antitrust laws, we're going to just see this happening over and over again.

There are some simple things we can do to put the burden on merging companies or a company engaging in discriminatory conduct to actually prove that it doesn't hurt competition, as opposed to putting it all on the government. We have just successfully given a major shot in the arm to the antitrust enforcers when it comes to resources with a bill Senator Grassley and I and Cicilline, Neguse, and Buck worked on over in the House that we passed to up the merger fees by about $100 million a year.

And that is on companies, big companies, not little ones, that will help to fund the enforcers. They can't take on the biggest companies, whether it's Google or Facebook or Amazon. They can't take on the biggest companies a world has ever known with duct tape and Band-Aids.

They're literally a shadow of what they were under the Nixon administration.

Geoff Bennett: Yes.

Well, I want to draw you out on that, because there are people who will watch this interview and wonder, why should Congress concern itself with this, that the free market is crippled by too much government intervention, too much government regulation, and that the reason why Ticketmaster is dominant is because it's best of brand.

Sen. Amy Klobuchar: Hmm.

I don't think all the fans would agree that we shouldn't have any competition. So, first of all, we have a bunch of conservatives supporting this. You heard from them today. They believe that, if you're going to have capitalism that works -- and I believe this too -- you need to have antitrust enforcement.

You go back to the founding of this country, and Adam Smith, who was the godfather of capitalism, he said, watch out for the unbridled standing army of monopolies. Fast-forward to Senator Sherman, who was a Republican. Fast-forward to Roosevelt, when he rode his horse into the White House on busting up the trust. That was a Republican senator.

Over time, it's been Democrats and Republicans working together to take on monopolies. Back then, it was a railroad trust, and now it is big tech ticketing what we're seeing right now. We simply can't say it's all OK, and we're not going to do anything since the advent of the Internet on all of this. We can't do that.

We have to take some action. So, I was heartened by today's hearing. And I believe that, if you believe in capitalism, and competitive responses to things, you have to unleash competition and not allow monopolies to dominate a market. And that is exactly what's happening right now in ticketing.

Geoff Bennett: Senator Amy Klobuchar.

Senator, I will tell you, we watch a lot of congressional hearings around these parts. And today's was a really interesting one. So, thanks for being with us.

Sen. Amy Klobuchar: Thank you. That's a good PBS adjective.

(LAUGHTER)

Sen. Amy Klobuchar: I very much appreciate it. I just want to see action. Thank you.

Geoff Bennett: And you can watch the full Senate hearing about Ticketmaster online at PBS.org/NewsHour.