Day 7: Ticketmaster's "Velvet Hammer"
The head of U.S. Concerts for Live Nation and the CEO of its biggest rival detail controversy over Zach Bryan's tour, ticketing and amphitheaters.
“We’re blocked because of [Ticketmaster’s] exclusive ticketing agreements.”
That was how Jay Marciano, CEO of AEG Presents and COO of AEG, described what he sees as the consequence of Live Nation’s dominance over major concert venues. After a week-long pause, the historic antitrust trial resumed on Monday in full force.
AEG is the closest thing Live Nation Entertainment has to a full-scale rival. Like Live Nation, AEG has a promotion arm (AEG Presents) and a ticketing arm (AXS). And though it is Live Nation’s biggest competitor, Live Nation still dwarfs the company. Live Nation’s promotion business is roughly three times the size of AEG Presents and Ticketmaster is more than ten times that of AXS.
Marciano testified that Live Nation’s long-term exclusive contracts with venues prevents AXS from competing on equal footing. In most major U.S. venues, he said, AEG is required to hand ticketing operations to Ticketmaster, its direct competitor.
“We produce the show… we put together a promotion campaign,” he said. “And then in most major venues in the United States we’re required to turn the ticketing over to our direct competitor, which is Ticketmaster.”
Zach Bryan’s Ticketmaster-Free Tour
Marciano pointed to Zach Bryan as an example of Live Nation/Ticketmaster’s dominance. In 2023, Bryan wanted to build a tour around venues that didn’t have exclusive Ticketmaster contracts. Bryan didn’t like Ticketmaster, and, being promoted by AEG Presents, he asked the company to book tour venues that did not have these exclusive Ticketmaster agreements. AEG followed through, and the tour largely, though not entirely, avoided Ticketmaster venues.
In 2024, Bryan returned to working with Live Nation and Ticketmaster for parts of his next tour, which Marciano said “exceed[ed] the profitability” of the 2023 tour. The moral of the story, he implied, was that artists may want alternatives, but to mount a successful tour, they must continue to use Ticketmaster. If fans are frustrated with the numerous issues he suggested they regularly encounter with Ticketmaster, they also have nowhere else to go to purchase their tickets.
This conjure might be an example of monopoly power or simply a reflection of how the industry operates in America.
AEG is more international than Live Nation and Ticketmaster. Marciano supports some of the “open-room” systems offered throughout Europe, in which venues are not locked into long-term exclusive agreements.
The idea of open-room agreements is so unpopular in the United States, however, that despite multiple proposals, no venues have agreed to this type of contract from AXS.
The Success of Live Nation Amphitheaters
The jury next heard from Robert Roux, who has overseen Live Nation’s U.S. concert division since 2010, including its amphitheaters. Live Nation owns or exclusively books over 60 of the top 100 amphitheaters in the U.S. The states’ argue that Live Nation conditions venue access on signing with the company as a promoter.
Emails shown to the jury detailed how Live Nation pushed to expand its amphitheater ownership. Those it owns have also grown more profitable over time. A slideshow shown to the court pointed to a 46 percent increase in per-fan profitability at amphitheaters from 2019 to 2022.
Either We Are Together or We Are Competitors
Three amphitheaters Live Nation exclusively books were previously under deals with Red Mountain Entertainment, a small regional promoter in the south. Live Nation bought the promoter and its venues in 2018.
When Roux was first made aware of Red Mountain, in 2016, he wrote that he would make sure territorial managers develop plans to “mitigate any expansion,” that Live Nation could not “get complacent and let small guys encroach from the edges.”
Two years later, Red Mountain was exploring a potential sale, and Live Nation expressed interest in acquiring it. Rapino expressed concern to Roux about continuing to host Live Nation shows at Red Mountain venues while the company’s future relationship with Live Nation was still uncertain.
Roux then told Red Mountain executives, “Either we are together or we are competitors.” He told Rapino at the time that this message “seemed to work as [Red Mountain has] three venues, two festivals and another venue coming online in [2018] and want the content flow on artists where we have touring rights in the U.S. Velvet hammer.”
Alignment with Live Nation preserved access to its touring artists; independence relinquished that access.
Live Nation promotes 90 percent of concerts at its own amphitheaters. Roux acknowledged instances in which the company declined proposals from outside promoters, even when those deals would have generated substantial revenue. In one case, Live Nation rejected an event proposal from Disney, despite an estimated financial upside of $400,000-500,000, seemingly due to concerns about allowing other promoters into its venues. The states argue that such decisions amount to exclusionary acts designed to limit competition.
Roux’s testimony wrapped earlier today. And the states will continue their case.