The Ticketmaster Scandal: Definitely/Maybe a Breach of Competition Law?

The UK competitions watchdog, the Competition and Markets Authority (CMA), announced on 5 September 2024 that it had begun investigations into Ticketmaster following criticism from consumers who have been paying hundreds of pounds above original ticket prices.

Ticketmaster’s pricing practices have been under intense focus this week following complaints by fans seeking to purchase Oasis Reunion concert tickets.

Reports in the press have referenced the use of “dynamic pricing” by Ticketmaster in their ticket sales which is reportedly responsible for the high prices that fans have been required to pay for tickets.

What is dynamic pricing?

The demand-based system was introduced by Ticketmaster in 2022. It said it was brought in to stop touts and ensure more money goes to the artists.  

Essentially, when Ticketmaster determines there is a lot of demand for tickets, and limited supply, the price can go up.

Dynamic pricing, used by Ticketmaster for Oasis ticket sales, meant that prices of tickets sold would rise and fall in line with an algorithm assessing demand. This has led to prices of tickets for Oasis increasing by more than £200.

Is “dynamic pricing” illegal?

No, but lack of transparency for the customer around this issue may engage potential breaches of competition and consumer law which the CMA are now investigating.

A letter from the CMA to Culture Secretary Lisa Nandy and Business Secretary Jonathan Reynolds have said that dynamic pricing was not unlawful but that the practice must be transparent and not mislead consumers.

Why should I take notice?

Ticketmaster, which claims to be the world’s biggest entertainment ticketing platform is now being investigated by the Competitions and Markets Authority (CMA). The investigation will look at whether they have breached consumer protection law following widespread criticism of dynamic pricing over the past week from Oasis fans.

Although Ticketmaster claims to be one of three official sellers for the Oasis shows, an investigation by the BBC has found that all three promoters for the Oasis reunion tour have links to one company: Live Nation, a US multinational which owns Ticketmaster.

Ticketmaster also says it was artists and promoters which set the ticket pricing policy. However, the band has hit out at the system noting that they left decisions on ticketing and pricing entirely to their promoters and management.

The CMA has said it will also consider whether it is appropriate to investigate the conduct of anyone else in relation to the matter.

The government has promised to look into dynamic ticket pricing following the selling of the inflated Oasis tickets. It has also been reported that a spokesperson for the European Commission has confirmed that it was looking into the use of dynamic pricing for concert tickets amid growing concerns among parliamentarians in Brussels.

Lawsuits against Live Nation/Ticketmaster in the US

Leigh Day is also aware of a US lawsuit against Live Nation/Ticketmaster where the US Justice Department, along with 30 state and district attorneys general, filed a civil antitrust lawsuit against Live Nation Entertainment Inc. and its wholly owned subsidiary, Ticketmaster LLC (Live Nation-Ticketmaster) for monopolisation and other unlawful conduct that thwarts competition in markets across the live entertainment industry.

There are also class actions in different provinces in Canada including claims of monopolisation in the primary and/or secondary ticket sales markets and various consumer claims against Live Nation/Ticketmaster practices.

What about the UK?

There is a question about defining the market in which Ticketmaster operates and whether it is dominant in that market. As the main seller of the tickets, was Ticketmaster the market maker? Did it have significant market power? Competition law requires market players who are dominant to behave absolutely by the rules in place.

There are many questions about the manner in which the sale was conducted. Has Ticketmaster created a perception of scarcity that led to people paying more for tickets than they would otherwise have done? Are there mechanisms in place within the algorithm that could lead to a market distortion? Are any protective systems in place? We do not know, as the operation of the algorithm is proprietary. There is a lack of transparency about how the system operates.

If there was a breach of competition rules, fans of the band could in principle be entitled to bring a joint claim under competition law at the Competition Appeal Tribunal. However, claims of this type require very significant recoveries to be viable, and the threshold is unlikely to be met as regards the Oasis tickets alone.

Subject to further investigation a claim under the Consumer Right Act 2015 may also be viable. 

Further updates will follow.