The proposed Ticketmaster / Live Nation merger moved closer to becoming reality today as the U.S. Department of Justice announced it will approve the union with concessions.
Comcast-Spectacor has the opportunity to buy the Paciolan ticketing system from Ticketmaster in the next 60 days and has already signed a letter of intent.
“The Department of Justice’s proposed remedy promotes robust competition for primary ticketing services and preserves incentives for competitors to innovate and discount, which will benefit consumers," said Christine Varney, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. "The proposed settlement allows for strong competitors to Ticketmaster, allowing concert venues to have more and better choices for their ticketing needs, and provides for anti-retaliation provisions, which will keep the merged company in check."
Also, the merged company would be barred from retaliating against any venue owner that uses another company’s ticketing or promotional service, Reuters said. Additionally, the company will need to license its primary ticketing software to AEG.
Live Nation CEO Michael Rapino said in a statement: "This is a good and exciting day for the music business, and we are close to finalizing the creation of a new company that will seek to transform the way artists distribute their content and fans can access that content. The Department of Justice was thorough and aggressive in their analysis and their remedies, and we are confident that with this resolution the playing field is competitive and broader as a result of this transaction. We believe that this merger will now create a more diversified company with a great selling platform for artists and a stronger financial profile that will drive improved shareholder value over the long term."
Irving Azoff, CEO of Ticketmaster, said, "We appreciate the Department of Justice's effort. Their resolution is a great win for fans. The entertainment industry needs innovation and we are ready to deliver. I'm truly excited that as this new company goes forward, we will be able to create more choices for family entertainment, sports, artists, teams and other rights holders."
Some key points from the DOJ decision:
"Under the proposed settlement, Ticketmaster must license ticket software and divest ticketing assets to two different companies —Anschutz Entertainment Group (AEG) and either Comcast-Spectacor or another buyer suitable to the department, respectively —allowing both companies to compete head-to-head with Ticketmaster."
"Ticketmaster must license a copy of its primary ticketing software to AEG, the nation’s second-largest concert promoter and operator of some of the most important concert venues in the country. With a copy of the Ticketmaster software, AEG will be able to market a ticketing system that is an attractive choice to venues. "
"Within five years, AEG can purchase the Ticketmaster ticketing software, decide to create its own software, or partner with a ticketing company other than Ticketmaster. The department said that this remedy enhances short and long term competition in the primary ticketing market."
"Ticketmaster must divest Paciolan Inc., a ticketing company that it currently owns, within 60 days to either Comcast-Spectacor, which has already signed a letter of intent to purchase the assets, or some other buyer suitable to the department. "
"Under the settlement, the merged firm will be forbidden from retaliating against any venue owner that chooses to use another company’s ticketing services or another company’s promotional services, including restrictions on anticompetitive bundling."
"The merged firm must also allow any client that leaves and chooses to use another primary ticketing service to take a copy of the ticketing data related to that client’s sales. The settlement also sets up firewalls that protect confidential and valuable competitor data by preventing the merged firm from using information gleaned from its ticketing business in its day-to-day operations of its promotions or artist management business."
Click here for today’s complete statement from the U.S. Department of Justice regarding the Ticketmaster / Live Nation merger.