The UK Competition Commission (CC), after giving the matter a second review, has decided to again approve the Ticketmaster/Live Nation merger.
In a report filed late last week, the CC said it believes the merger of the world’s largest event ticketing company and the largest concert promoter “would not result in a substantial lessening of competition in the market for live music ticket retailing or in any other market in the UK, including live music promotion and live music venues.”
The commission first approved the merger in December of last year, reversing its preliminary findings from a couple of months earlier. Following the December approval, rival ticketing company CTS Eventim lodged a complaint to have the CC reconsider the decision because the company believed it had not been given an adequate chance to file its concerns.
A spokesperson for CTS Eventim did not immediately reply to a message seeking comment. The company believed the merger could harm its chances to compete in the UK ticketing market, in part because Eventim was concerned that a UK ticketing contract it had signed with Live Nation prior to the merger could be affected.
“After taking into account further submissions from the parties and reconsidering the evidence, we have reconfirmed our original decision that the merger will not have a significant effect on the success or otherwise of Eventim in entering and expanding in the UK ticketing market,” Christopher Clarke, Deputy Chairman and Chairman of the CC’s Inquiry Group, said in a statement.
“The agreement with Live Nation, to which both parties have stressed their commitment, will provide Eventim with a foothold in the UK but no more than that, as it requires Live Nation to supply only a relatively small number of tickets to Eventim for Eventim to sell. We found that, in the absence of the merger, Live Nation’s priority was very clearly to sell its own tickets and to use Eventim’s system to do so. Following the merger, Live Nation does have the incentive to restrict the number of tickets it allocates to Eventim, but we found that its ability to do so was limited by the agreement. We did not believe that, in the absence of the merger, Live Nation would have allocated significantly more of its tickets to Eventim or sponsored or supported Eventim’s entry into the UK as a ticket retailer in any other way,” he added.
Live Nation and Eventim have had a rocky relationship since the two signed a ticketing contract in late 2007, a partnership deal that called for Eventim to help create Live Nation’s own ticketing operation. The two spent a year building the operation, but experienced problems with it soon after the launch, which helped lead to Live Nation’s decision to discontinue using Eventim, yet continue paying them, and replace them with Ticketmaster in North America.
Unlike the U.S. Department of Justice (DOJ) decision to approve the merger, neither of the CC’s decisions called for any conditions, or concessions, from Live Nation and Ticketmaster to allow the deal to move forward. The DOJ required the newly formed Live Nation Entertainment to sell its Paciolan primary ticketing division to rival Comcast-Spectacor, promises that it would not retaliate against entities that stopped working with the company and a deal to license Ticketmaster’s ticketing software to another rival, Anschutz Entertainment Group.
Michael Rapino, President and CEO of Live Nation Entertainment, said in a statement that the company was pleased by the new ruling. “We applaud this decision by the U.K. Competition Commission and are pleased to have the matter resolved. Our focus is on the future and continuing to execute on our goals of driving innovation across the live event experience and strengthening the artist-to-fan connection.”
In addition, the CC also said that “although Live Nation’s incentives have changed as a result of the merger, the scope for the merged entity to affect Eventim’s expansion in the UK was limited.”
Live Nation and Eventim will continue their business arrangement in the UK. “The CC has also reiterated that, while the merged entity might have the ability to use its position as a ticket retailer, promoter and venue operator to harm its competitors in different parts of the supply chain, either by reducing the supply of its services or by supplying its services on worse terms, it would not have the financial incentive to do so. Specifically, the CC has found that, if the merged entity tried to harm its competitors in these ways, it would suffer significant short-term losses in pursuit of very uncertain long-term gains,” the commission said.
In the U.S., several concert promoters have complained about the merger to the DOJ, as part of a public comment period following the January approval, and the Justice Department will issue a response to those complaints at some point in the near future.
“If Eventim is to establish itself in the UK market as a large-scale ticket retailer, in keeping with its presence in other countries, this will depend on its own efforts and abilities in attracting consumers and obtaining tickets from other promoters and venue operators, and will not be affected significantly by the merger,” Clarke said, concerning the CC’s decision. “We have taken into account that there have been a number of disputes over the terms and operation of the agreement between Live Nation and Eventim, but we found that these disputes did not undermine materially our analysis of the impact of the merger.”
