Jay Marciano, CEO of AEG Presents, told his company that Live Nation is a monopoly that will likely be broken up as a result of the Department of Justice’s antitrust lawsuit filed in May, according to an internal memo published by Variety. At stake, Marciano says, “is the entire ecosystem of our industry, one that has long suffered from a badly broken ticketing model.”

“AEG has long maintained that Ticketmaster has a monopoly in the U.S. ticketing marketplace and uses that monopoly power to subsidize Live Nation’s content businesses, preventing other businesses from competing in those areas and leaving consumers to suffer the consequences,” reads the memo, in part.

“As you know, the cornerstone of Live Nation’s monopoly is Ticketmaster’s exclusive ticketing contracts with the vast majority of major concert venues in the United States,” it continues. “These agreements block competition and innovation and result in higher ticketing fees, denying artists the ability to choose who will ticket their shows and how much their fans should pay.”

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AEG being in favor of the DOJ breaking up its dominant competitor is not surprising, given the history of its public statements on the matter. It was central to a major 2018 report in the New York Times implying that Live Nation regularly threatened venues who didn’t use Ticketmaster for their shows – which is a core complaint that continues through to the 2024 DOJ antitrust lawsuit.

More recently, AEG publicly pushed back against Liberty Media CEO Greg Maffei implying that the company purposefully chose Ticketmaster for Taylor Swift’s Eras Tour in the wake of that disastrously botched ticket sales mess. Due to the exclusive ticketing contracts in place for most of the large venues in the U.S., AEG had no choice but to use the ticketing operation owned by its competitor.

FURTHER READING | AEG: Exclusive Contracts Left Swift “No Choice” But Ticketmaster

Naturally, Live Nation’s antitrust czar Dan Wall centered his reply on the fact that AEG would reasonably stand to benefit significantly from a potential breaking of his company’s business model.

“This is why antitrust protects competition, not competitors trying to use the courts to advance their own interests. AEG supports this case — indeed, begged DOJ to file it — because it doesn’t want to pay artists market rates or convince venues to adopt its second-rate ticketing system exclusively,” Wall told Variety. “Its complaints about service charges are hypocritical since it could lower AXS service charges today if it really cared about that. Self-serving arguments like these are common in antitrust cases, but rightly ignored.”

No such condemnation or push for the DOJ to press on with its lawsuit has come from the other major player in live events in the North American market- Oak View Group. That company, which is run by former Ticketmaster/Live Nation head Irving Azoff and former AEG head Tim Lieweke, has not responded in any way to the blockbuster lawsuit that could re-shape the live events business ecosystem since it was filed two weeks ago.

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Oak View Group is not targeted by the lawsuit itself, but there are explosive allegations among the multiple allegedly monopolistic practices outlined by the DOJ’s complaint implying that it has largely grown through colluding with, rather than competing against, Azoff’s former company.

FURTHER READING | DOJ Alleges Oak View Group Colluded With Live Nation in Lawsuit

Azoff actually started AEG Live as a competitor of Live Nation (then known as SFX) alongside Lieweke, with backing from billionaire Philip Anschutz. But Ticketmaster’s purchase of Azoff’s Front Line Management business led to him being appointed the CEO of Ticketmaster, where he became the architect of the merger between the ticketing giant and the promotional giant, shepherding it through a contentious governmental approval process.

From an exhaustively reported piece by American Prospect outlining Azoff’s massive influence in the business and key role in both Live Nation and Oak View’s current status:

At a congressional hearing to discuss the anti-competitive implications of the deal, Azoff promised the public that partners “would most certainly leave” Ticketmaster if the merger went through. “AEG has notified us by letter that they believe they have the right to terminate our agreement in connection with this merger. If that’s not competition, I don’t know what is.” But AEG had not at that point invested any funds in developing their own ticketing software, and its CEO Randy Phillips said he’d been completely blindsided by the merger. Azoff’s “testimony is completely disingenuous,” he told the Associated Press.

AEG launched its own ticketing startup – AXS – in 2011, but that company has struggled to land major ticketing contracts, due in large part to both Ticketmaster and Live Nation’s use of long and exclusive contracts for ticketing with major venues, and fear of retaliation from the promoter should venues use AXS to ticket their events. Azoff left Ticketmaster within three years of the merger’s approval, but has apparently continued to work behind the scenes to support it while building Oak View Group’s complimentary operations and serving as the primary backer of the so-called “Fix The Tix” coalition, which largely echoes Live Nation’s legislative agenda.

The machinations of the giants atop the entertainment industry will likely continue to churn over the next several years as the DOJs case against Live Nation and Ticketmaster plays out.

AEG’s full memo is included below:

No doubt all of you are closely following the ongoing media coverage in the wake of the Department of Justice lawsuit against Live Nation and Ticketmaster. As I mentioned in my note from last week, we spent the last few days carefully reviewing the DOJ filing, as well as Live Nation’s subsequent response to the complaint.

AEG has long maintained that Ticketmaster has a monopoly in the U.S. ticketing marketplace and uses that monopoly power to subsidize Live Nation’s content businesses, preventing other businesses from competing in those areas and leaving consumers to suffer the consequences. This lawsuit is not simply DOJ suing to break up a monopoly; at stake is the entire ecosystem of our industry, one that has long suffered from a badly broken ticketing model. As you know, the cornerstone of Live Nation’s monopoly is Ticketmaster’s exclusive ticketing contracts with the vast majority of major concert venues in the United States. These agreements block competition and innovation and result in higher ticketing fees, denying artists the ability to choose who will ticket their shows and how much their fans should pay.

Following the DOJ filing, Live Nation issued several public comments in service of its ongoing strategy to maintain its dominance – unfairly blaming others for industry problems they have created, making false and misleading statements, and dismissing the significance of the case. Artists, venues, and brokers are not responsible for the broken live entertainment business model in this country – that responsibility lies with Live Nation. Notwithstanding its claims about its profit margins or its market share, it is a monopoly, and it uses its monopoly power to impose its will on the live entertainment business. Live Nation may claim that its margins on promotion are low, but that’s only because it deploys the excessive profits of its ticketing monopoly to outspend what the concert market can profitably sustain. Live Nation does this with the goal of removing competitors from the business and in turn using its continued control of content to preserve a stranglehold on ticketing through venue exclusives.

The DOJ’s case is serious and reflects widespread sentiment among 30 attorneys general from across the country, numerous media outlets, industry commentators, consumer groups, and antitrust experts that Live Nation’s conduct violates the law and harms competition and consumers. While it may take some time, we strongly believe that DOJ’s lawsuit will succeed and ultimately bring sweeping changes resulting in increased competition and more innovation and choice that benefits fans, artists, and our entire industry. DOJ’s lawsuit means that artists will have a choice in who tickets their concerts, that the ticketing fees consumers pay will be lower, and ultimately that artists and fans will have access to what we all want: more and higher quality live entertainment experiences at a price that fans can afford. We look forward to each and every one of you helping us lay the groundwork now for the future of the industry.

Let’s not get distracted by Live Nation spin. Instead, let’s stay focused on continuing to execute at the highest level, and preparing for a future state of the industry: a world with more competition, more innovation, artist and consumer choice, lower ticketing fees, and more music.

– Jay