Senators are working to get the Federal Telecommunications Commission to enforce a 2016 law called the Better Online Ticket Sales (BOTS) Act, which is meant to prevent and penalize those who run automated bots when purchasing tickets from online sales platforms.
Members of the Senate Judiciary Committee on Tuesday questioned and strongly criticized Joe Berchthold, president of Live Nation Entertainment—parent company of Ticketmaster—for its failed rollout of tickets for a Taylor Swift concert tour.
In November, Ticketmaster canceled a planned ticket sale to the general public for Swift’s tour after more than 3.5 billion requests from fans, bots, and scalpers overwhelmed its website.
Committee members also brought up antitrust issues, with the company representing the most sales of any ticketing platform over its competitors.
Chairman Dick Durbin (D-Ill.) criticized the company and its explanations for the issues, saying they are symptomatic of a larger problem.
“The ticketing and live entertainment markets lack competition and they are dominated by a single entity—Live Nation,” he said. “Live Nation merged with TicketMaster in 2010 in a deal that joined the country’s largest ticketing company with its largest event promoter.”
Durbin added that the Department of Justice (DOJ) and attorneys general from many states sued to block the merger. The merger ultimately went through, but the DOJ put in place a consent decree with conditions and divestitures to ensure competition in ticketing and live entertainment markets.
“Unfortunately, that consent decree does not appear to have been effective,” Durbin said. “In the decade-plus since the merger, Live Nation has consolidated its dominant position in the ticketing and live entertainment markets, and the result is a competition-killing strategy that has left artists and fans paying the price.”
Ticketmaster’s Point of View
In his testimony to the committee, Berchtold said that since the 2010 merger, the company has spent over $1 billion in capital to improve Ticketmaster’s system, including eliminating fraud by bots and ticket scalpers.
“We hear people say that the ticketing markets are less competitive today than they were at the time of the Live Nation–Ticketmaster merger—that’s simply not true,” he said. “Ticketmaster has lost, not gained, market share since the merger.”
He added that the company anticipated bot attacks for the Swift tour, but they were hit with “three times the amount of bot traffic” the company had ever experienced. He added that the attack did not penetrate their system, but slowed down and shut down traffic. He said the company apologized to Swift and fans but that it needs “to do better.”
Berchtold himself said the BOTS Act should be expanded in scale and enforced.
Blackburn and Blumenthal Team Up
Sen. Marsha Blackburn (R-Tenn.) and Sen. Richard Blumenthal (D-Conn.) both called for the FTC to better enforce the BOTS Act, which Blumenthal co-sponsored in the Senate and Blackburn sponsored in the House as a representative, prior to her election to the Senate.
In the committee hearing Tuesday, Blackburn said the FTC has only enforced the BOTS Act once even though it’s had the authority to do so since 2016, adding that she and Blumenthal plan on doing more work on the Senate Commerce Committee’s Consumer Protection Subcommittee to alleviate the problem for consumers.
Blackburn spoke of her own experience in December downloading a ticketing app owned by Ticketmaster to take her grandsons to see the University of Tennessee football team play in the Orange Bowl. Blackburn said the app not only offered the tickets, but offered parking, general merchandise, and travel options.
“You are getting a lot of consumer data and consumer information, so I want to know, what are you doing with that data,” she said. “Now you told me yesterday you block about 90 percent of the bot attacks that you get, but that’s a failing grade, and we know that, because—and there ought to be people you can get some good advice from—because our critical infrastructure in this country, whether it is utilities, electric, water, power, banking services, credit card processors, payment processors, health care companies—you know what, they get bot attacks every single day by the thousands. By the thousands. And they have figured it out, but you guys haven’t? This is unbelievable.”
Blackburn focused her ire on the FTC and Ticketmaster, stating while the FTC has the responsibility and authority, Berchtold was responsible to consumers.
In her questioning, Blackburn asked if the company had called the FTC for help with bot attacks. Berchtold pointed to one cooperating scenario with the FTC, when his company asked for the agency’s assistance in an investigation in 2019.
Blumenthal did not mince words to Berchtold either, thanking him for bringing Republicans and Democrats together in an “absolutely unified cause.”
“May I suggest, respectfully, that unfortunately your approach today in this hearing is going to solidify that cooperation, because as I hear and read what you have to say, it’s basically, ‘It’s not us, it’s everyone but us,'” Blumenthal said. “And the fact of the matter is that Live Nation–Ticketmaster is the 800-pound gorilla here. You have clear dominance, monopolistic control. This whole concert ticket system is a mess. It’s a monopolistic mess.”
Music Industry Workers ‘Frustrated’
In an interview on CNBC, Blumenthal and Blackburn furthered their case, speaking of privacy, antitrust issues, and consumer protections.
“When I am out and about in Nashville, I hear from tour managers, I hear from business managers, talent agents, how frustrated they are with what is happening with Live Nation, with Ticketmaster, and they feel it’s appropriate for us to step in,” Blackburn said in the interview. “In 2016 when I was in the House, Senator Schumer—at that point—and I passed the BOTS Act, which gives the FTC the authority to move in and to go after these bots, to work with these ticketing platforms. And the FTC has not exercised that authority.”
While she criticized the FTC, she also said the ticket platforms need to get the information to the FTC when they become aware of bots in their systems so they can be blocked from the sites.
“So fans, whether they’re fans of the Grand Ole Opry or Taylor Swift or any of the other ones that are out there, they can get the tickets for the shows that they want,” she said.
Blumenthal in the interview and hearing even brought up the idea of exploring breaking up the company if necessary, noting if the Justice Department found the company violated earlier consent decrees, “unwinding the merger ought to be on the table.”
The hearing lasted nearly three hours, and more work is expected out of the committee and others related to antitrust and consumer protections.
Reuters contributed to this report.