How Concert Prices Got Jacked (video)

Competition between concert promoters was once a stabilizing force on ticket sales. Multiple concert promoters bid against each other to secure talent for large and small venues. But when only one company owns all the large venues, they can dictate prices to everyone except the big acts which they gladly pay for their fielty. This keeps emerging concert promoters from being able to get into the market because new concert promoters can’t afford to pay what Live Nation shells out to a touring artist. Live Nation does not pay an act (a performer) because the act is good per se, they pay in order to secure them as a commodity to keep them out of the hands of other concert promoters. Live Nation’s business model has no long term prospects for gain because the costs for squashing competition steal any revenue for growth or investors. Which is why Live Nation stock is a terrible investment. Live nation’s business practice has more to do with control than profit. Though they they try to recoup through astronomical fees that even the most apolitical fans are rising up against. Culturally concerts become an activity only for the rich and the middle lower income folk see fewer concerts. This hurts the artists that are not yet famous because they get less exposure.

How do we get competition back into the live events industry?  The Department of Justice needs to file an antitrust lawsuit against Live Nation and force the divestiture of 75% of their venues.  Does this seem like too much?  It’s not.  When the monopoly of Bell telephone was broken up they ended up split into 7 companies.  By that metric Live nation would be forced to divest of 85.71% of their assets.  Live Nation will argue that they are not a complete monopoly because there are still some promoters out there.  This is true, but they are a “Functional Monopoly”, meaning they have enough ownership of the market to dictate the terms to everybody else.

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