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The US Senate has issued a subpoena to Ticketmaster and parent company Live Nation Entertainment after the ticket-selling giant refused to cooperate with an investigation about the company's pricing, Vice reported.
The government didn't announce the investigation, but it follows incidents over the last year such as the ticketing debacle for Taylor Swift's Eras Tour when tickets sold on the company's website were so high that most customers weren't able to afford them.
The chairman of the Senate Permanent Subcommittee on Investigations (PSI) Richard Blumenthal wrote in a letter to Live Nation that the subpoena “seeks records related to Line Nation/Ticketmaster's failure to combat artificially inflated demand fueled by bots in multiple, high-profile incidents, which resulted in consumers being charged exorbitant ticket prices.”
Ticketmaster's dynamic pricing
Vice's Motherboard reported about Ticketmaster's issue with ticket brokers and bots. This stems from the company's dynamic pricing. Also known as surge-, demand- or time-based pricing, an algorithm increases ticket prices based on the demand. This is what happened to the ticket prices for Inter Miami's Leagues Cup final a few month ago.
When bots buy tickets as soon as they're released, the algorithm responds to the quick sales as high demand. This causes the prices to rise to astronomical levels, which then leaves customers to pay thousands of dollars for the ticket or buy them from resellers.
FAIR Ticketing Act
After the outcry from both fans and politicians for how Ticketmaster failed in handling the ticket sales for Taylor Swift's concert, Live Nation Entertainment proposed the FAIR Ticketing Act in February. The proposal aims to fight against bots and ticket scalpers. There has been no update on the act yet.
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Sen. Blumenthal (D-CT) told Live Nation Entertainment CEO Michael Rapino in the letter that the subpoena was “in connection with [the committee's] inquiry into Live Nation/Ticketmaster's business practices, including the prices and fees for tickets to live events sold by Live Nation/Ticketmaster,” which started almost eight months ago.
The letter continued, “PSI first wrote to Live Nation/Ticketmaster on March 24, 2023, seeking documents and information in connection with this inquiry. Despite nearly eight months and extensive efforts to obtain voluntary compliance, Live Nation/Ticketmaster has failed to fully comply with PSI’s requests, including refusing to produce certain documents critical to the Subcommittee’s inquiry.”
In an emailed statement to Motherboard, a Live Nation spokesperson said, “Live Nation has voluntarily worked with the Subcommittee for many months, and we’ve already provided over 10,000 documents and held several meetings with staff. The subcommittee is seeking additional information about how artists set prices and venues determine fees, but we do not feel comfortable sharing this information without standard confidentiality measures. Thus far the Subcommittee has refused to provide such assurances, but if and when those protections are in place we will provide additional information on these topics.”
However, Blumenthal rebutted in a thread on X (formerly twitter), “Live Nation has egregiously stonewalled my Subcommittee’s inquiry into its abusive consumer practices—making the subpoena necessary. American consumers deserve fair ticket prices, without hidden fees or predatory charges. And the American public deserves to know how Ticketmaster’s unfair practices may be enabled by its misuse of monopoly power.”
In January, a Senate Judicial Committee hearing cast the merger of Live Nation and Ticketmaster in 2010 as a monopoly. The company could be facing an antitrust lawsuit.
