In recent years, there has been growing public frustration over the high prices and fees charged by major concert ticket companies. Prices keep rising while fees seem increasingly dubious, leading many to accuse the dominant players in the industry of monopolizing the market at the expense of fans. This article will examine which company has established an effective monopoly over concert tickets, how they achieved this position, and the impacts on consumers.
The Main Players
There are two major companies that dominate the market for concert tickets in the US and Canada:
Live Nation Entertainment
Live Nation Entertainment is the largest player in the live music industry. Formed in 2005 after Clear Channel Communications (now iHeartMedia) spun off its live events division, Live Nation owns Ticketmaster, the biggest primary ticket seller for concerts. According to Pollstar, Live Nation sold 117 million tickets in 2019 through Ticketmaster and controlled 69% of the primary ticket market that year.
Beyond Ticketmaster, Live Nation also owns over 200 venues and has exclusive booking rights for hundreds more. The company promotes over 30,000 events per year across dozens of countries. Other Live Nation properties include events promoter Live Nation Concerts, ticketing platform Universe, and artist management company Front Line Management Group.
AEG Presents
The other major player is AEG Presents, a subsidiary of the Anschutz Entertainment Group. AEG Presents is the second largest concert promoter in the world, responsible for over 10,000 events annually including major global festivals like Coachella.
While not as dominant as Ticketmaster, AEG owns ticketing platforms AXS and AXS Ticketing, which are used by their owned/operated venues. AEG Presents also has exclusive booking agreements with venues like the O2 Arena in London, Staples Center in Los Angeles, and Barclays Center in New York.
Together, Live Nation and AEG control around 80-90% of the major US concert venues. They also dominate tour promotion, ticketing services, and related assets. This duopoly allows them to exert enormous influence over the live music sphere.
How Did This Near-Monopoly Arise?
Live Nation and AEG built their dominant position through aggressive expansion and consolidation of assets in the live music industry. Their rise was fueled by:
Vertical integration
Live Nation and AEG have pursued vertical integration, controlling all aspects of concert promotion. They own venues, sell tickets, manage artists, host festivals, and more. This captures value across the industry pipeline without reliance on outside vendors.
Acquisitions
The companies have systematically acquired competitors and adjacent businesses. Prime examples are Live Nation merging with Ticketmaster and AEG operating AXS Ticketing. This strategy eliminates rivals and brings more assets under their umbrella.
Exclusive agreements
By locking down exclusivity deals with venues, festivals, and managers, Live Nation and AEG make it extremely difficult for competitors to gain a foothold. Even mega artists like U2, Madonna, and Jay-Z tour exclusively with Live Nation.
Lobbying
Both companies spend millions lobbying local governments to fund and approve venue projects. They secure public backing for construction that further cements their market control.
| Company | Est. Lobbying Spend (2021) |
|---|---|
| Live Nation | $1,000,000 |
| AEG | $2,321,500 |
Economies of scale
Their huge size allows bulk discounts and leverage over suppliers. Smaller competitors cannot match their operational efficiency and pricing power.
Impacts of the Concert Ticket Monopoly
While Live Nation and AEG have been hugely successful businesses, their effective duopoly has been controversial for its harms to consumers and artists. Criticisms of the consolidated market include:
Higher fees
Fans bear more costs in fees, which can add 25-30% to already pricey tickets. Live Nation was even fined $20 million in 2020 for threatening venues over ticket fees.
Higher prices
With negligible competition, Live Nation and AEG can charge higher prices. Ticket prices for major tours now average $92 versus $26 in 1996.
Reduced innovation
The lack of market competition removes incentive for improving services, interfaces, and features. Ticketing platforms remain dated and frustrating for users.
Anti-competitive behavior
Critics argue Live Nation and AEG exploit their power to squash rivals and engage in anticompetitive practices like locking up exclusive artist deals. The Government Accountability Office found Ticketmaster abused this power as early as 1994.
Reduced bargaining power for artists
Mega stars like Swift, Grande, and Bieber may have negotiating leverage. But less-established artists have little choice but to accept Live Nation or AEG’s promoter terms. Their share of revenue is squeezed.
Limited consumer choice
Fans rarely have alternatives to Ticketmaster or AXS for major concerts and festivals. The options are use them or don’t attend.
What Can Be Done?
There are no easy solutions for curbing the market dominance of Live Nation Entertainment and AEG Presents. Some measures that could potentially improve competitiveness include:
Stricter antitrust enforcement
Regulators could be more aggressive in blocking anti-competitive mergers and exclusivity deals. However, Live Nation and AEG are already extremely consolidated.
Venue ownership limits
Capping the number of venues controlled by a single company may open up space for independents. But Live Nation and AEG would fight hard against such regulation.
Fee caps
Some jurisdictions limit how much can be charged in fees above face ticket value. This protects consumers but squeezes promoter margins.
Support ticket resale
A thriving secondary market gives fans alternative ticket sources and puts price pressure on primaries. However, promoters dislike resellers cutting into their sales.
Investigate dynamic pricing
Live Nation has been accused of manipulating supply and variable pricing to maximize revenue. More transparency and oversight could help.
Develop artist unions
Collective bargaining power could help artists negotiate better deals with promoters and avoid exclusivity clauses. But organizing such unions is an uphill battle.
Conclusion
Through aggressive consolidation of venues, promotions, ticketing and adjacent assets, Live Nation Entertainment has established an effective monopoly over the concert industry in North America. With its Ticketmaster subsidiary selling around 70% of primary tickets, Live Nation has the power to charge high fees and prices that have doubled the costs for fans over the past 25 years.
Along with AEG Presents, this duopoly controls virtually all large concerts and squeezes artists into restrictive deals. Fans, artists, and consumer advocates have grown increasingly vocal over the harms from this lack of competition. However, Live Nation and AEG’s deep pockets and lobbying power make dismantling their dominance extremely difficult. Until the market structure changes, the live music industry will remain firmly under the control of these two behemoths.
