How Australia’s music cartels are driving up the cost of live shows

Australia’s competition watchdog has given the strongest indication yet that it has the giants of the music industry in its sights, as the concentration of ownership is leading fans to pay up to 20 per cent more than they ought to for live events.

While declining to reveal details, Scott Gregson, chief executive of the Australian Competition and Consumer Commission, said the regulator was keeping a close eye on the antitrust case launched against Live Nation by the US Department of Justice in April.

Festivalgoers at Splendour in the Grass in 2023.Credit: Bianca Holderness

“We do see some consistency in behaviours that are part of that DOJ investigation and action with the type of things we hear in Australia,” Gregson told an inquiry into the challenges and opportunities facing Australian live music in Canberra.

“We don’t comment on matters that might be under investigation, but if your question is, do we receive similar issues, do we look, are we watching the DOJ action, yes is the answer to all of those.”

Live Nation is the world’s largest music promoter and pioneered the “360-degree model” through which it extracts revenue from every aspect of the performance sector via its interests in events, artist management, venues, ticketing and merchandise. Its revenues in 2023 totalled $US22.7 billion.

In Australia, the company has acquired smaller promoters, festivals (including Falls and Splendour in the Grass, both of which were cancelled this year), and venues. It also has exclusive contracts with several non-owned venues through its subsidiary Ticketmaster.

It is not unique in having embraced vertical integration, with major rival TEG Dainty – which is a major shareholder in Laneway Festival and owner of Ticketek – having pursued a similar strategy locally and internationally.

But that strategy is potentially at odds with the pro-competition and pro-consumer remit of the ACCC.

“We’re familiar with concerns about concentration and vertical integration in the market, in particular booking, promotion, ticketing and venue event sectors,” Gregson said. “We’re aware of concerns of restrictions that might apply, for example [that] venue festival operators might impose on artists. We’re familiar with issues that may arise in connection with markets for ticketing or promotions and exclusivity arrangements.

“When you start to have highly concentrated markets … it flows through in terms of choice and prices for consumers … and that’s where you’ve got to then look at misuse of market power.

“Where those restrictions are in place, they go to lessening of competition, which inevitably restricts choice, increases prices [and] leads to inefficient outcomes.”

The ACCC’s general manager Richard Fleming, also speaking at the inquiry, likened the Australian market to a cartel situation, with a direct inflationary impact for consumers.

“It ranges between 10 to 20 per cent, is generally the rule of thumb,” he said. “[If] you’ve got smaller artists trying to negotiate with those larger venues and larger ticket providers, and some of those ticket providers provide exclusive arrangements to venues for sometimes multiple years, I think that all leads to the restrictions that we’re talking about.”

But that view was disputed by TEG Dainty managing director Tim McGregor in his evidence to the inquiry on Friday morning.

“I think it’s a misconception that somehow the ticketing company or the promoter have any significant influence on the pricing of tickets,” he said.

Claiming the biggest factors on ticket price were artist minimum guarantees and prices being paid by other promoters, he said, “there’s very little influence we have”.

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