Ticketmaster's Practices Come Under Scrutiny
Thursday, February 12, 2009
It's been a rough couple of weeks for Ticketmaster, the nation's largest ticket-seller.
The company's handling of ticket sales for Bruce Springsteen's upcoming "Working on a Dream" tour quickly turned into a public-relations nightmare when fans complained that they had been unable to buy tickets from Ticketmaster's Web site but were offered tickets, at a considerable markup, from a Ticketmaster subsidiary, TicketsNow.
The attorneys general in New Jersey and Connecticut opened investigations.
A congressman, Rep. Bill Pascrell Jr. (D-N.J.), demanded a federal inquiry.
Springsteen and his manager lashed out publicly, writing in a blistering letter that "the abuse of our fans and our trust by Ticketmaster has made us as furious as it has made many of you."
Then, Ticketmaster chief executive Irving Azoff issued a public apology -- and the beleaguered company began to issue some refunds.
Yesterday, the Justice Department launched an investigation into Ticketmaster's proposed $2.5 billion merger with concert-promoting behemoth Live Nation. (The potential marriage of the two entertainment giants was announced Tuesday.) The Justice Department "is committed to vigorous enforcement of the merger antitrust laws and will conduct a thorough investigation," agency spokeswoman Gina Talamona said.
The agency routinely examines mergers of this size. A Ticketmaster spokesman said that the two companies "welcome the opportunity to fully discuss the agreed-upon merger with the government and look forward to cooperating with any review of the deal."
In a letter to U.S. Attorney General Eric H. Holder Jr. yesterday, Sen. Charles E. Schumer (D-N.Y.) and Pascrell, the congressman from New Jersey, expressed their opposition to the merger, citing anti-competitive concerns "and past allegations about Ticketmaster's actions."
Ticketmaster has long been a target of fan and musician criticism, mostly for the fees the company adds to every ticket purchase. A spoof headline posted this week on Fark.com played up the percolating unhappiness with how the company does business: "Live Nation to acquire Ticketmaster for $2.5 billion, plus $700 million in convenience charges." (Never mind that the proposed deal is an all-stock merger and not an acquisition.)
A Ticketmaster spokesman declined to comment on the company's public image, but Chairman Barry Diller said during a conference call Tuesday that "Ticketmaster is never perceived to be on the side of the angels."
Ticketmaster is under investigation in New Jersey and Connecticut, where the attorneys general launched separate inquiries last week into the company's handling of tickets to Springsteen's concerts in New Jersey and New York.