Ticketmaster backs CA proposals to curb speculative sales – CalMatters

from Kayla MichalovichCalMatters

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Earlier this year, tickets to SZA’s performance at Los Angeles’ Crypto Arena sold for $600 the day before they officially went on sale at $35 a piece. In San Francisco, tickets to see Sam Smith at the newly renovated Castro Theater went on sale for $120, only to be quickly snapped up by scalpers and resold for over $600.

These are some of the stories California lawmakers are citing as they develop two plans to change the ticketing landscape. One limits the extent to which distributors can mark up the original price of a ticket, while the other prohibits distributors from selling tickets they don’t already own.

Democratic Assembly members Isaac Bryan of Culver City and Democrat Matt Haney of San Francisco are carrying bills they say would protect consumers from fraudulent and fraudulent ticket sales.

Both measures are backed by dominant ticket market seller Live Nation, which owns Ticketmaster. His supporters have some worried that the bills will help the company crush its competitors and raise prices. A federal jury in New York this week found that the company illegally acted as a monopolist in a victory, among others, for California Attorney General Rob Bonta, who with colleagues from other states sued the company two years ago and continued after federal prosecutors settled. Live Nation now expects penalties.

Despite these headwinds, ticket bills are sailing through the Legislature.

Supporters say the legislation has nothing to do with the antitrust case against Live Nation and helps consumers. Opponents disagree.

“The state legislature should really stand up for consumers instead of proposing bills that are there to help a monopoly that has been captured calling his fans stupid and bragging about robbing them blind” said Jose Barrera, national vice president for the Far West Region at the League of United Latin American Citizens, a civil rights group.

Ticketmaster’s competitors in the online resale market are lobbying against the measures, a sign that they see the proposals as a threat to their business.

Jack Stern, StubHub’s head of political communications, wrote to CalMatters saying, “Passing laws that give more power to the Ticketmaster monopoly and don’t actually make tickets more affordable is the last thing California’s leaders should be doing.”

But Steven Parker, executive director of the National Independent Venue Association, which co-sponsored the bills, argued they would regulate the market to better protect fans by limiting price gouging and encouraging the exchange of tickets at or below par.

“At the end of the day, that’s what these bills are going to do, in addition to ensuring that the tickets are indeed genuine,” he said. “It’s a good thing for California consumers. It’s a good thing for artists, and it’s a good thing for these small businesses and nonprofits that make up the independent scenes across the state.”

A spokesperson for Live Nation said in a statement to CalMatters: “The resale lobby is constantly trying to change the subject by pointing the finger at Ticketmaster, even though it has less than 25% of the resale market. This has nothing to do with anyone’s monopoly, but rather to protect fans from scalpers and the resale sites that cater to them.”

The company has spent approximately $165,000 on lobbying efforts this legislative session, including supporting Bryan’s bill.

“Unlikely Allies”

Brian’s Assembly Bill 1349 will prohibit the sale of speculative tickets – or tickets that are not owned or owned by the people listing them online. In an April hearing, Bryan said the bill protects consumers from predatory markups.

“This bill is so important that it has brought together unlikely allies since its introduction,” Bryan said, according to CalMatters Digital Democracy database. “In fact, this bill brought the Giants and the Dodgers together, the National Association of Independent Venues and Live Nation together. It brought Kendrick Lamar and Kid Rock together. It brought Isaac Bryant and Donald Trump together.”

Several secondary ticket sellers are fighting the measure, including StubHub, SeatGeek and Vivid Seats. The three companies have spent an estimated $1.1 million on lobbying efforts this legislative session, which includes opposing Bryan’s bill.

Opponents, including Robert Herrell, executive director of the Consumers Federation of California, say the bill strengthens Live Nation Ticketmaster’s grip on the ticketing and live entertainment industries. They say the measure would give Live Nation full control over the ticket even after it’s been purchased — meaning, for example, that consumers could lose the ability to sell or give it away.

“There is no consumer choice in the matter,” Herrell said. “They can keep people out of shows if they want. There have been situations where if you’ve bought a ticket on the secondary market, you’ve been denied entry to a show.”

Supporters say Herrel and other opponents are wrong. They say they are not trying to prevent transfers, but rather want to protect fans from speculative spending.

“We want those rooms to be full,” said Ron Gubitz, executive director of the Music Artists Coalition, which co-sponsored both bills. “So you have to be able to transfer a ticket. We just want it to be in a way that’s safe, reliable and doesn’t create this movement in the market that exists now.”

Gubitz pointed to a recent Bruno Mars concert where tickets were on StubHub for $400 to $2,000 before going on sale through Ticketmaster.

“It’s crazy,” he said. “This is a speculative ticket that Bryan’s bill is trying to stop. This shouldn’t be happening. It’s not fair to anyone but the secondary (market). It looks great for them.”

Free market price ceilings

Haney’s Assembly Bill 1720also known as the California Fans First Act, would place a 10% cap on event ticket resale allowances, including ticket fees. In other words, the distributor cannot charge more than 10% more than the original price of the ticket.

In an interview with CalMatters, Haney said that artists, independent venues and centers are currently being “screwed and exploited” by scalpers and brokers.

“We cannot allow the status quo to continue if we want to ensure that Californians have access to affordable tickets to see their favorite artists, or if we want independent venues or the broader community of musicians and artists to thrive in our state,” he said.

Haney rejected the idea that his bill would strengthen Live Nation Ticketmaster’s monopoly, saying the company is one of the largest operators and earners of the secondary ticket market and therefore would be subject to the same restrictions as any other platform or broker.

“I don’t think it’s a free market to let people come in and buy all these tickets and then create a shortage and then now you have to buy your ticket at a much higher price from someone who has nothing to do with the event,” he said. “It’s not something we would ever allow for plane tickets or even dinner reservations.”

The bill was criticized by opponents such as Diana Moss, vice president and director of competition policy at the Progressive Policy Institute, who said price caps proverbially distort the market, describing them as “anti-consumer, anti-competitive and anti-artist.”

“If you shut down the resale market with price caps, then guess what? Ticket buyers have nowhere to go but straight back to Ticketmaster,” Moss said. “If (Live Nation) succeed in destroying the resale market, then they drive millions upon millions of fans back to their own ticketing platform where they charge monopoly ticket fees and where fans are held hostage to their bogus online platform and all their data, privacy and security concerns that we always hear about in the news.”

Those concerns didn’t stop the bill from passing the Assembly Arts, Entertainment, Sports and Tourism Committee last week by a 6-1 vote. The bill also passed the Privacy and Consumer Protection Committee on Thursday by a 9-4 vote.

Kayla Michalovich is a contributor to California Local News.

This article was originally published on CalMatters and is republished under Creative Commons Attribution-NonCommercial-No Derivatives license.