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

Taylor Swift’s tour promoter did not mince words in placing blame on the disastrous Eras Tour ticket sale with Ticketmaster, telling CNBC it had “no choice” but to use Live Nation Entertainment’s ticketing company due to the massive number of exclusive contracts it has with venues in the United States. The statement from Messina Touring’s parent AEG Presents strongly contradicted arguments made by Liberty Media CEO Greg Maffei that AEG “chose to use us” for the massive tour.

“Ticketmaster’s exclusive deals with the vast majority of venues on the ‘Eras’ tour required us to ticket through their system,” AEG said in response to an interview given by Maffei, whose company is Live Nation Entertainment’s largest shareholder, followed closely by the Saudi foreign investment fund. “We didn’t have a choice.”

Ticketmaster was the primary ticketing agency for just under 50 shows on the tour, with the remaining shows handled by SeatGeek. Both vendors forced the use of Ticketmaster’s “Verified Fan” pre-registration system for presales, which collapsed under the immense traffic, drawing major criticism and political pressure to take a hard look on Live Nation/Ticketmaster as a monopoly. The required usage of the ticketing vendor due to the exclusive contracts involved came despite AEG Presents being the corporate parent of its own ticketing company, AXS.

Maffei had pointed to that fact – that AEG used the ticketing service of its competitor – as proof that Ticketmaster was a superior product while defending the company against an attack by prominent democratic congresswoman Alexandra Ocasio-Cortez launched as the Swift sale imploded.

“Though AOC [a common nickname for Ocasio-Cortez] may not like every element of our business, AEG, our competitor who is the promoter for Taylor Swift, chose to use us because we are, in reality, the largest and most effective ticket seller in the world. Even our competitors want to come on our platform,” Maffei said in an interview.

Clearly, that competitor wanted to set the record straight.

In the wake of the Taylor Swift ticketing debacle, Live Nation and Ticketmaster have been on the defensive, fending off criticism of their business model and technological capabilities by claiming that no technical system could have withstood the traffic spikes caused by “swifties” searching for tickets to the stadium tour. Live Nation published a rare statement specifically outlining why it doesn’t consider itself to be monopolistic, contradicting much of the commentary coming from elected officials who quickly pointed at the failed sale as an example of monopolistic companies having no incentive to improve their product due to competition.

Swift herself has spoken out against the ordeal her fans faced, though she did not call out Ticketmaster or Live Nation directly.

“It goes without saying that I’m extremely protective of my fans,” the statement begins. “It’s really difficult for me to trust an outside entity with these relationships and loyalties, and excruciating for me to just watch mistakes happen with no recourse.”

“I’m not going to make excuses for anyone because we asked them, multiple times, if they could handle this kind of demand and we were assured they could,” the statement continued. “It’s truly amazing that 2.4 million people got tickets, but it really pisses me off that a lot of them feel like they went through several bear attacks to get them.”

A U.S. Senate subcommittee has already announced plans to hold hearings on the nature of the Live Nation/Ticketmaster merger, with an eye towards the possibility of initiating a process that could undo the paired businesses, which were merged with DOJ approval in 2010.