LOS ANGELES (CelebrityAccess) — Jay Marciano, the chairman and CEO of AEG Presents, reportedly agrees with the Department of Justice’s contention that Live Nation operates like a monopoly in the live entertainment industry. Shocker, right?
According to Variety’s Jem Aswad, Marciano’s remarks came in an internal memo circulated to AEG’s employees on Friday, where he reportedly said: “AEG has long maintained that Ticketmaster has a monopoly in the U.S. ticketing marketplace and uses that monopoly power to subsidize Live Nation’s content businesses, preventing other businesses from competing in those areas and leaving consumers to suffer the consequences.”
In the memo, Marciano took issue with Live Nation’s public defense of the government’s claims of monopoly, suggesting that the allegedly low-profit margins the company realizes from its promotion business are a symptom of the promoter’s monopoly.
“Live Nation may claim that its margins on promotion are low, but that’s only because it deploys the excessive profits of its ticketing monopoly to outspend what the concert market can profitably sustain. Live Nation does this with the goal of removing competitors from the business and in turn using its continued control of content to preserve a stranglehold on ticketing through venue exclusives,” Marciano said, per Variety.
Marciano also highlighted Live Nation’s exclusive ticketing contracts with a “vast majority” of major North American venues as a key factor in the company’s influence in the live events industry in the region.
“These agreements block competition and innovation and result in higher ticketing fees, denying artists the ability to choose who will ticket their shows and how much their fans should pay,” he reportedly wrote in the memo.
According to Marciano, he believes the Department of Justice will likely prevail in its lawsuit against Live Nation.
“The DOJ’s case is serious and reflects widespread sentiment among 30 attorneys general from across the country, numerous media outlets, industry commentators, consumer groups, and antitrust experts that Live Nation’s conduct violates the law and harms competition and consumers. While it may take some time, we strongly believe that DOJ’s lawsuit will succeed and ultimately bring sweeping changes resulting in increased competition and more innovation and choice that benefits fans, artists, and our entire industry,” he reportedly stated in the memo.
In a response provided to Billboard’s Dave Brooks, Dan Wall, Live Nation’s executive vice president for corporate and regulatory affairs, said: “This is why antitrust protects competition, not competitors trying to use the courts to advance their own interests. AEG supports this case — indeed, begged DOJ to file it — because it doesn’t want to pay artists market rates or convince venues to adopt its second-rate ticketing system exclusively. Its complaints about service charges are hypocritical since it could lower AXS service charges today if it really cared about that. Self-serving arguments like these are common in antitrust cases, but rightly ignored.”
