Feds, states put mark on Ticketmaster merger

Nick Rees Jan. 25, 2010, 2:00pm

WASHINGTON (Legal Newsline) - The U.S. Department of Justice has been joined by 17 state attorneys general in an effort to protect consumers during the Ticketmaster and Live Nation merger.

The newly combined company must make significant changes to its merger agreement, including taking steps to ensure that competition in primary ticketing services for events in the United States is preserved. Primary ticketing services include the maintenance of websites and call centers where tickets can be purchased initially for a venue event.

Ticketmaster, which had 80 percent of the primary ticketing services market in 2008, announced plans to merge with Live Nation, its primary source of competition, in February. The merger, as originally proposed, threatened to lessen competition in the primary ticketing service market, leading to higher prices and less innovation for consumers, the states and feds said.

The Department of Justice and 17 state attorneys general, after reviewing the proposed merger, decided that, to protect competition, divestitures and anti-retaliation provisions were necessary. Those measures included providing access to one of its major technology platforms and selling Paciolan, a Ticketmaster-owned Delaware-based corporation that provides ticketing services throughout the United States.

Ticketmaster, as a result, will provide AEG Worldwide, the second largest concert promoter in the United States, with its technology platform. This will allow AEG to provide both primary ticketing and concert promotion services to venues.

Comcast, the likely buyer of Paciolan, is expected to become a stronger competitor for primary ticketing services, the AGs say. By acquiring the divested asset, it is believed the company will have the tools needed to become an effective competitor in primary ticket servicers.

The newly merged company has also agreed that it will not retaliate against a venue that contracts with or is contemplating contracting with another company for ticketing services.

In addition, the merged firm cannot require venues uses its concert promotion services or artists as a condition for the use of its primary ticketing services. The company is also not allowed to use collected concert ticketing data for the benefit of its non-ticketing businesses or share that data with others.

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