CEO Blames Bot Cyberattack For Website Crash In Congressional Testimony

Topline

Live Nation President Joe Berchtold told members of Congress that “industrial scalpers” and a “cyberattack” caused the Taylor Swift ticket sales meltdown last year in testimony before a Senate judiciary subcommittee on Tuesday–as lawmakers floated policy remedies, including restrictions on transferrable tickets to cut down on scalping and greater transparency surrounding ticket fees.

Key Facts

Senate Judiciary Committee Chair Dick Durbin (D-Ill.) suggested the Swift ticket debacle was directly tied to Ticketmaster’s outsize power in the industry since its 2010 merger with Live Nation, which he said “has consolidated [Live Nation’s] dominant position” and resulted in a “competition-killing strategy that has left artists and fans to pay the price.”

Berchtold, meanwhile, insisted that the ticket market is more competitive today than it was at the time of the merger due to the “enormous secondary ticketing market,” and disputed estimates that Ticketmaster’s market share is at 80%, instead estimating it is 50-60%.

Berchtold said that the industry’s problems are a “direct result of industrial scale ticket scalping,” and blamed the Swift ticket fiasco on an unprecedented amount of bots that attacked its site and forced the company to pause sales.

Berchtold acknowledged that “there are several things we could have done better,” in tandem with Congress, including increasing protections against targeted bot attacks and greater transparency “so fans can see the full cost of their ticket from the start.”

In addition to Berchtold, SeatGeek CEO Jack Groetzinger, Jam Productions co-founder Jerry Mickelson, musician Clyde Lawrence, Sal Nuzzo of the James Madison Institute think tank and Kathleen Bradish of the American Antitrust Institute also testified.

Crucial Quote

“I have to throw out in deference to my daughter Eliza one more Taylor Swift quote: ‘Karma is a relaxing thought. Aren’t you envious that for you it’s not?’ That’s all I’ve got to say,” Sen. Mike Lee (R-Utah) said in his closing statement.

Tangent

Sen. Richard Blumenthal (D-Conn.) advocated for passage of the “BOSS Act” he introduced in 2019 that would enhance transparency surrounding fees associated with ticket purchases, prohibit ticket resales by entities directly involved in the events and establish new protections to prevent multiple sales for the same seat at an event. Sen. John Kennedy (R-La.) raised the possibility of restricting ticket transfers to prevent scalpers from making mass purchases and stabilize ticket prices—an idea Sen. Josh Hawley (R-Mo.) cast skepticism on, expressing concerns that it could ultimately harm consumers.

Key Background

Ticketmaster’s site crashed in November following a pre-sale ticket-drop for Swift’s upcoming “Eras” tour, a debacle the company initially blamed on “historically unprecedented” demand. Outraged fans were faced with hours-long wait times, tickets were oversold and Ticketmaster temporarily suspended sales because of lack of inventory. Swift spoke out amid the outrage, assuring fans that she was promised that Ticketmaster “could handle this kind of demand.” Ticketmaster, for years, has faced criticism over its market pull. The Department of Justice in 2019 found Live Nation had violated the consent decree that facilitated its merger with Ticketmaster by retaliating against concert venues for using other ticket-selling platforms, and a federal court extended the decree for another 5 ½ years past its 2020 deadline as result.

Further Reading

Congress To Hold Antitrust Hearing On Ticketmaster Amid Taylor Swift Tour Mess (Forbes)

Klobuchar Slams Live Nation After Taylor Swift Chaos—As New Congress Threatens Future Of Antitrust Legislation (Forbes)

Ticketmaster Gives Some Fans Another Chance At Taylor Swift ‘Eras’ Tickets After Presale Fiasco (Forbes)