Bombshell Report Sent To US Senate Accuses Ticketmaster & Live Nation Of Negotiating Increased Rates With Vendors To Decrease Artist Payouts

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In case you didn’t know, all my homies hate Ticketmaster.

The ticketing giant has come under a lot of fire over the last year or so after botched onsales for major tours like Taylor Swift, Tyler Childers and Beyonce, with accusations that Ticketmaster and parent company Live Nation hold a monopoly in the entertainment industry that’s unreasonably increasing prices for fans.

The controversy over Ticketmaster’s fees and business practices led to executives being dragged in front of Congress last year for a contentious hearing that may have been the only time in recent memory that both Democrats and Republicans were truly united.

It’s safe to say that everybody hates Ticketmaster.

And a recently-released report may shed more light on why.

Congressman Bill Pascrell of New Jersey recently sent a report to Senator Richard Blumenthal, who is the chair of the Senate Permanent Subcommittee on Investigations, which lays out what the report alleges are some pretty shady business practices on the part of Ticketmaster and Live Nation – business practices that help to line their own pockets at the expense of artists and, ultimately, fans.

The report was filed in 2019 in a lawsuit between Live Nation Entertainment and New Jersey-based promoter Juice Entertainment, LLC, and was written by Richard Barnet, a professor emeritus at MTSU who formerly served as chairman of the university’s Department of Recording Industry. His resume also includes time spent as a festival manager for a music festival, and a booking agent.

Barnet served as an expert witness in the case in which the promoter accused Live Nation of anti-competitive business practices, which ultimately resulted in their being fired as the promoter of the New Jersey State Fair. And his report contains some eye-opening allegations into the business practices of Ticketmaster and Live Nation.

In the report, which Live Nation fought to keep from being admitted as evidence, Barnet alleges that Live Nation and Ticketmaster would negotiate third-party expenses directly with vendors, such as venues, in exchange for “rebates” that went not to artists or promoters, but directly back to Ticketmaster/Live Nation.

The result of these negotiations would mean higher costs to promote and produce an event – which means that when it came time for an artist to “settle up” after a show, it would look like the event actually brought in less profit than it did, meaning a smaller payout to artists, agents or promoters.

Essentially, an artist would agree to perform a show for a certain amount of the profit, minus the cost of putting on the show. Ticketmaster and Live Nation would then artificially inflate the cost of putting on the show by negotiating higher contracts with vendors. This means the artists were making less money, because more was coming out of their pay for the expense of these contracts negotiated by Live Nation. Then, once everything was paid up with the artist, Ticketmaster would get a “rebate” on the costs of the contracts, unbeknownst to the artist, their agents or promoters.

According to the report:

“Higher third-party expense means an event may be more expensive to produce and promote for all involved including agents, artists, and co-independent promoters within the contingency contracts that Live Nation/Ticketmaster uses…

Some shows indicate a “loss” or “very low profit” on public statements presented to artists, agents, managers and co-independent promoters, but a “profit” after factoring in the “rebates” in the internal accounting documents of Live Nation/Ticketmaster.”

To put that in language that everybody can understand: It’s shady as hell.

Several bills have already been introduced in Congress that take aim at Ticketmaster and Live Nation’s business practices, including the BOSS and SWIFT Act, which would, among other things, require ticket sellers to disclose the full price of tickets upfront and prevent them from changing the price of tickets during the sale process without notifying the buyer.

And another, the Unlock Ticketing Markets Act, would prevent Ticketmaster and Live Nation from locking venues into restrictive, multi-year contracts that eliminate competition in the marketplace.

I don’t think anyone would argue that something doesn’t need to be done. At this point, the only question is what, and whether it actually gets done.

But if the allegations made in this new report are true, it only makes the need for action that much stronger.

You can read the full report here if you’re interested.

@whiskeyriff On the street with Whiskey Riff: Do all the homies hate Ticketmaster? // #whiskeyriff ♬ original sound – Whiskey Riff

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