Ticketmaster parent company Live Nation Entertainment
What Happened: Live Nation, one of the world's largest entertainment companies, owns Ticketmaster, operates hundreds of global music venues, and manages artists.
Those divisions combined along with attention put on the company for its high fees and consumers not being able to get tickets to Swift's "The Eras Tour" have led to an investigation by the Department of Justice.
A lawsuit by the Department of Justice against Live Nation could be filed as soon as next month, according to a report from the Wall Street Journal.
The potential lawsuit could put pressure on the leading entertainment company over concerns of having too dominant a position in the ticketing market.
Ticketmaster has faced anticompetitive concerns from members of Congress and several state attorneys general, according to the report.
Ticketmaster's website crashed during a fan presale for tickets for Swift's tour, which led to increased attention to the company's ticketing process. The concerns over fans not being able to get tickets to the tour may have led to increased attention by the Department of Justice.
For its part, Live Nation has defended its practices and said that it does not have a monopoly. The company's head of corporate affairs Dan Wall recently said Ticketmaster prices are set by artists and their teams and not Ticketmaster. He added that the majority of the fees go to venues, a crucial detail given Live Nation's ownership of many such venues, which could become a focal point in the DOJ lawsuit.
When counting the largest venues in the U.S., Ticketmaster has around an 80% market share for primary ticket sales according to the report, which includes in many cases exclusive ticketing contracts.
Why It's Important: Live Nation and Ticketmaster merged together in 2010 to form Live Nation Entertainment.
The Department of Justice did not challenge the merger in 2010 according to the report, which served as a surprise to some at the time.
Representative Alexandria Ocasio-Cortez (D-NY) was among those who called out the merger when discussing the concerns over ticket problems for Swift's tour in 2022.
"Daily reminder that Ticketmaster is a monopoly, its merger with LiveNation should never have been approved, and they need to be reigned in," Ocasio-Cortez tweeted on Nov. 15, 2022.
Competition could become a key point in the potential lawsuit.
"Ticketmaster has more competition today than it has ever had, and the deal terms with venues show it has nothing close to monopoly power," a Ticketmaster spokeswoman said, as shared by the Journal.
As part of the 2010 merger, a settlement was reached that prevented the combined company from retaliating against artists or venues that chose to use other ticketing services. The settlement that was set to expire in 2020 was extended through 2025.
The investigation by the DOJ may have found violations of the revised settlement.
The popularity of Swift and her record-breaking tour have thrust Ticketmaster into the spotlight, often casting it in a negative light for many. Country artist Zach Bryan added to the attention with his 2022 live album titled "All My Homies Hate Ticketmaster."
Ticketmaster is trending on social media Tuesday, with many quick to celebrate a potential breakup of the company or rules that will lower the fees that many concert goers have been paying for years.
LYV Price Action: Live Nation shares are down 7% to $92.81 on Tuesday, versus a 52-week trading range of $64.96 to $107.24.
