    [Senate Hearing 118-31]
    [From the U.S. Government Publishing Office]

                                                             S. Hrg. 118-31

                          THAT'S THE TICKET: PROMOTING
                           COMPETITION AND PROTECTING
                        CONSUMERS IN LIVE ENTERTAINMENT

    =======================================================================

                                    HEARING

                                   before the

                           COMMITTEE ON THE JUDICIARY
                              UNITED STATES SENATE

                        ONE HUNDRED EIGHTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                JANUARY 24, 2023

                                   __________

                               Serial No. J-118-1

                                   __________

             Printed for the use of the Committee on the Judiciary

                           COMMITTEE ON THE JUDICIARY

       [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                 U.S. GOVERNMENT PUBLISHING OFFICE
     52-250 PDF           WASHINGTON : 2023

                       RICHARD J. DURBIN, Illinois, Chair
    DIANNE FEINSTEIN, California         LINDSEY O. GRAHAM, South Carolina,
    SHELDON WHITEHOUSE, Rhode Island             Ranking Member
    AMY KLOBUCHAR, Minnesota             CHARLES E. GRASSLEY, Iowa
    CHRISTOPHER A. COONS, Delaware       JOHN CORNYN, Texas
    RICHARD BLUMENTHAL, Connecticut      MICHAEL S. LEE, Utah
    MAZIE K. HIRONO, Hawaii              TED CRUZ, Texas
    CORY A. BOOKER, New Jersey           JOSH HAWLEY, Missouri
    ALEX PADILLA, California             TOM COTTON, Arkansas
    JON OSSOFF, Georgia                  JOHN KENNEDY, Louisiana
    PETER WELCH, Vermont                 THOM TILLIS, North Carolina
                                         MARSHA BLACKBURN, Tennessee
                 Joseph Zogby, Chief Counsel and Staff Director
          Katherine Nikas, Republican Chief Counsel and Staff Director

                                C O N T E N T S

                                  ----------

                          JANUARY 24, 2023, 10:04 A.M.

                        STATEMENTS OF COMMITTEE MEMBERS

                                                                       Page

    Durbin, Hon. Richard J., a U.S. Senator from the State of
      Illinois.......................................................     1
    Graham, Hon. Lindsey O., a U.S. Senator from the State of South
      Carolina.......................................................     2
    Klobuchar, Hon. Amy, a U.S. Senator from the State of Minnesota..     3
    Lee, Hon. Michael S., a U.S. Senator from the State of Utah......     5

                                   WITNESSES

    Witness List.....................................................    55
    Berchtold, Joe, president and chief financial officer, Live
      Nation Entertainment, Beverly Hills, California................     8
        prepared statement...........................................    56
    Bradish, Kathleen, vice president for legal advocacy, American
      Antitrust Institute,Washington, DC.............................    14
        prepared statement...........................................    72
    Groetzinger, Jack, chief executive officer, SeatGeek, New York,
      New York.......................................................     9
        prepared statement...........................................    80
    Lawrence, Clyde, singer-songwriter, Lawrence, New York, New York.    16
        prepared statement...........................................    91
    Mickelson, Jerry, chief executive officer and president, Jam
      Productions, LLC, Chicago, Illinois............................    11
        prepared statement...........................................    95
    Nuzzo, Sal, senior vice president, The James Madison Institute,
      Tallahassee, Florida...........................................    13
        prepared statement...........................................   114

                                   QUESTIONS

    Questions submitted to Joe Berchtold by:
        Senator Booker...............................................   116
        Senator Padilla..............................................   117
        Senator Grassley.............................................   121
        Senator Lee..................................................   122
        Senator Cruz.................................................   124
        Senator Tillis...............................................   127
        Senator Blackburn............................................   130
    Questions submitted to Kathleen Bradish by:
        Senator Booker...............................................   132
        Senator Padilla..............................................   133
        Senator Grassley.............................................   134
        Senator Cruz.................................................   135
        Senator Tillis...............................................   137
    Questions submitted to Jack Groetzinger by:
        Senator Booker...............................................   138
        Senator Padilla..............................................   139
        Senator Cruz.................................................   140
        Senator Tillis...............................................   142
    Questions submitted to Clyde Lawrence by:
        Senator Booker...............................................   143
        Senator Padilla..............................................   144
        Senator Grassley.............................................   145
        Senator Tillis...............................................   146
    Questions submitted to Jerry Mickelson by:
        Senator Booker...............................................   147
        Senator Grassley.............................................   148
        Senator Cruz.................................................   149
        Senator Tillis...............................................   151
    Questions submitted to Sal Nuzzo by:
        Senator Grassley.............................................   152
        Senator Cruz.................................................   153
        Senator Tillis...............................................   155

                                    ANSWERS

    Responses of Joe Berchtold to questions submitted by:
        Senator Booker...............................................   164
        Senator Padilla..............................................   177
        Senator Grassley.............................................   170
        Senator Lee..................................................   171
        Senator Cruz.................................................   166
        Senator Tillis...............................................   186
        Senator Blackburn............................................   158
    Responses of Kathleen Bradish to questions submitted by:
        Senator Booker...............................................   191
        Senator Padilla..............................................   193
        Senator Grassley.............................................   195
        Senator Cruz.................................................   197
        Senator Tillis...............................................   200
    Responses of Jack Groetzinger to questions submitted by:
        Senator Booker...............................................   209
        Senator Padilla..............................................   205
        Senator Cruz.................................................   202
        Senator Tillis...............................................   208
    Responses of Clyde Lawrence to questions submitted by:
        Senator Booker...............................................   211
        Senator Padilla..............................................   213
        Senator Grassley.............................................   215
        Senator Tillis...............................................   216
    Responses of Jerry Mickelson to questions submitted by:
        Senator Booker...............................................   219
        Senator Grassley.............................................   223
        Senator Cruz.................................................   226
        Senator Tillis...............................................   233
    Responses of Sal Nuzzo to questions submitted by:
        Senator Grassley.............................................   239
        Senator Cruz.................................................   240
        Senator Tillis...............................................   244

                    MISCELLANEOUS SUBMISSIONS FOR THE RECORD

    Submitted by Chair Durbin:

        Future of Music Coalition, et al., statement.................   246
        Live Nation Entertainment, letter, January 31, 2023..........   251
        Nagle, Patrick, letter, January 18, 2023.....................   258
        ``Taylor Swift's Eras Tour on Track to Sell $590M in
          Tickets,'' Billboard, December 16, 2022....................   259
        Vivid Seats, statement, January 22, 2023.....................   262
        ``You're either Beyonce or you're working class,''
          MarketWatch, January 3, 2023...............................   268

    Submitted by Senator Klobuchar:

        Break Up Ticketmaster Coalition, statement...................   277
        Coalition for Ticket Fairness, statement, January 24, 2023...   281
        National Association of Ticket Brokers, statement............   285
        Sports Fans Coalition, statement, January 24, 2023...........   289
        WorkMoney, letter, January 30, 2023..........................   292

    Questions for Joe Berchtold, Live Nation Entertainment, Beverly
      Hills, California, letter via email correspondence from Senator
      Klobuchar and Senator Lee, February 2, 2023....................   295
    Responses of Joe Berchtold, Live Nation Entertainment, to
      combined questions submitted by Senator Klobuchar and Senator
      Lee, excerpted pages 16 to 18 from Mr. Berchtold's original
      responses in the Answers section...............................   297

                          THAT'S THE TICKET: PROMOTING

                           COMPETITION AND PROTECTING

                        CONSUMERS IN LIVE ENTERTAINMENT

                                  ----------

                           TUESDAY, JANUARY 24, 2023

                                  United States Senate,
                                    Committee on the Judiciary,
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 10:04 a.m., in
    Room 216, Hart Senate Office Building, Hon. Richard J. Durbin,
    Chair of the Committee, presiding.
        Present: Senators Durbin [presiding], Whitehouse,
    Klobuchar, Blumenthal, Hirono, Booker, Ossoff, Graham, Cornyn,
    Lee, Cruz, Hawley, Cotton, Kennedy, Tillis, and Blackburn.

              OPENING STATEMENT OF HON. RICHARD J. DURBIN,
               A U.S. SENATOR FROM THE STATE OF ILLINOIS

        Chair Durbin. This hearing of the Senate Judiciary
    Committee will come to order.
        I would like to welcome everyone to today's hearing. It is
    the first Committee hearing of the 118th Congress. Allow me the
    opportunity to share some good news about the Committee.
        Last Congress was productive. We reported nearly 40
    bipartisan bills, including bills that were ultimately signed
    into law to protect survivors of sexual assault and harassment,
    protect the safety of Federal judges and their families, invest
    and support law enforcement, and more. We restored the
    Committee's oversight role over the Justice Department,
    Department of Homeland Security, and the FBI, and held numerous
    bipartisan hearings on topics ranging from the fate of the
    Federal Bureau of Prisons to the FBI's mishandling of the Larry
    Nassar investigation, to holding war criminals accountable in
    our country. We worked in a successful fashion to fill
    vacancies on the Federal court, the Justice Department, the
    Sentencing Commission, and more.
        We did all this despite the challenges of an evenly divided
    Committee and Senate. Although he is not here at the moment, I
    want to thank Senator Chuck Grassley of Iowa for his service as
    Ranking Committee Member in the last Congress. He was a real
    partner in ensuring the business of this Committee was done.
        And I would like to welcome the new Ranking Member, my
    friend, Senator Lindsey Graham. He and I have worked together
    on many issues over many years, and I look forward to working
    with him again and all the Members of the Committee during the
    next 2 years.
        I would now like to turn to the subject of today's hearing,
    which focuses on competition in the ticketing and live
    entertainment industry. Live event ticketing garnered a lot of
    attention toward the end of 2022. Most notably in November,
    when Ticketmaster's systems failed during the presale for
    Taylor Swift's new tour, leaving millions of fans stuck in
    virtual queues for hours waiting to buy tickets.
        While Ticketmaster and its parent company, Live Nation
    Entertainment, have offered explanations for these issues,
    these issues are symptomatic, I think, of a larger problem. The
    ticketing and live entertainment markets lack competition, and
    they are dominated by a single entity, Live Nation.
        Live Nation merged with Ticketmaster in 2010 in a deal that
    joined the country's largest ticketing company with its largest
    event promoter. The Justice Department and attorneys general
    from many States, including Illinois, sued to block the merger.
    The plaintiffs ultimately allowed the merger to go through but
    put in place a consent decree with a set of conditions and
    divestitures designed to ensure competition in ticketing and
    live entertainment markets.
        Unfortunately, that consent decree does not appear to have
    been effective. In the decade plus since the merger, Live
    Nation has consolidated its dominant position in the ticketing
    and live entertainment markets, and the result is a
    competition-killing strategy that has left artists and fans
    paying the price.
        Before turning to Senator Graham, I would like to thank
    Senator Klobuchar, who has brought competition policy to the
    forefront of our national conversation as Chair of the
    Subcommittee on Competition Policy, Antitrust, and Consumer
    Rights. And also thank her Ranking Member, Senator Mike Lee of
    Utah.
        Senator Klobuchar and Senator Lee asked for this hearing
    and have led the effort in putting it together. They have
    assembled an expert panel of witnesses who will discuss how
    ticketing and live entertainment markets became so concentrated
    to the detriment of consumers, the impacts of that
    concentration, and the steps we need to take to bring
    competition back.
        I am going to turn to Senator Graham for opening remarks.
    Then Senators Klobuchar and Lee will speak. Then I will welcome
    and swear in the six witnesses and at that point hand the gavel
    to Senator Klobuchar to continue.
        Senator Graham.

              OPENING STATEMENT OF HON. LINDSEY O. GRAHAM,
            A U.S. SENATOR FROM THE STATE OF SOUTH CAROLINA

        Senator Graham. Thank you, Mr. Chairman. We are in a new
    Congress, a chance to start over and move forward hopefully in
    a productive fashion.
        I think this hearing today represents the best of the
    Committee. I want to thank Senator Lee and Senator Klobuchar
    for coming together, bringing us together over a matter that
    matters to a lot of Americans. I think sort of the big theme
    here today is consolidation of power in the hands of few can
    create problems for the many.
        Competition is a good thing, and we will determine today
    what happened. How did the system fail so spectacularly? What
    can we do in the future? But I think this hearing, and maybe
    the fruits of this hearing, represents sort of the better
    nature of the Judiciary Committee. We have a reputation of
    fighting among ourselves, which is okay because we have
    differences of what should happen in the country. But we also
    have a reputation of being able to solve problems for the
    Nation, and I intend to do both.
        Senator Grassley was a great Ranking Member. I know our
    Chairman well. I admire Senator Durbin. He is a man can fight,
    but he can also find consensus.
        And social media seems to be one of the areas that the
    Congress and the public is desirous of us doing something.
    These companies are the most powerful on the planet. They have
    almost unlimited money. They cannot be sued, and there is no
    real regulatory environment. So, Mr. Chairman, if you are
    looking for something to do together, I think dealing with the
    problem of social media would be something the Committee should
    focus on.
        I look forward to working with you in this hearing today as
    a sign that the Judiciary Committee is in business early on in
    the new Congress. And out of this hearing, I hope we can make a
    better experience for the consumer being able to buy tickets to
    things that you want to see without such a debacle.
        So thank you very much.
        Chair Durbin. Thanks, Senator Graham.
        Senator Klobuchar.

                    STATEMENT OF HON. AMY KLOBUCHAR,
               A U.S. SENATOR FROM THE STATE OF MINNESOTA

        Senator Klobuchar. Thank you very much, Chair Durbin,
    Ranking Member Graham, for holding this hearing and working
    with Senator Lee and myself.
        This is clearly a bipartisan endeavor. We have interest
    from both sides of the aisle. And I think you all know, as
    Senator Durbin mentioned, that competition policy is very
    important to me. I believe in capitalism, and to have a strong
    capitalist system, you have to have competition. You cannot
    have too much consolidation, something that, unfortunately for
    this country--as an ode to Taylor Swift--I will say we know
    ``all too well.''
        In over 75 percent of our industries ranging from
    agriculture to pharmaceuticals, to tech, to live events, a
    smaller number of large companies now control more of the
    business than they did 20 years ago. At the end of last year, I
    worked with Members of this Committee and our bipartisan
    partners--particularly, I want to mention Senator Grassley, and
    over in the House--Neguse, Cicilline, and Buck--to finally
    update our merger fee statute that had not been updated for
    decades. That is going to bring in $100 million a year for our
    enforcement agencies from the Justice Department to the FTC. It
    is really important.
        We also passed a key bill that Senator Lee has been
    advocating for on venue with the tech companies and allowing
    the State AGs to keep the cases in the States where they bring
    them. I think you are going to see more cases and more
    investigations coming out of the Justice Department. Watch for
    it. And I think that is going to be very important.
        But why am I here today and have taken this on? I love
    music. So I grew up in the suburbs. In high school, I remember
    loading into Johnny Royer's van with my friends and going off
    to see Led Zeppelin and the Cars and Aerosmith. And now I do
    not think it is very easy for high school kids to make their
    money at Baker Square Pie Shop on the weekend and buy tickets
    to these major concerts.
        My State also has made more than its share of contributions
    to music, from Prince to Bob Dylan to Lizzo. And in fact, First
    Avenue, the iconic event space where Prince got his start and
    was made famous in the movie ``Purple Rain,'' is a point of
    pride for the people in our State, and it is one of the reasons
    Senator Cornyn and I worked so hard to pass the Save Our Stages
    bill, which was the biggest investment in the arts in the
    history of America.
        So whether it is for fans, performers, promoters, or venue
    operators, we need to make sure we have competition to bring
    prices down and bring innovation in and stop the fiascos.
    Today, Live Nation does not just dominate the ticketing--it is
    about 70 percent of the big concert market--but also they own
    many of the major venues. And for the venues that they do not
    own, they tend to lock in on 3-, 5-, 7-year agreements, which
    means that the competitors that are out there are not able to
    even compete when it comes to the ticketing. Finally, they
    dominate the promoting.
        So we have talked to many venues--some of which are not
    willing to come forward, unlike one of them that is here
    today--but that say even if they are not out there threatening
    them, they are afraid to go to someone else because then they
    are not going to get the acts that they want. This is all a
    definition of monopoly. Because Live Nation is so powerful that
    it does not even need to exert pressure, it does not need to
    threaten, because people just fall in line.
        They continue to expand. Ticketmaster has gotten into the
    ticket resale game so they can charge fees when the ticket is
    first sold and then additional fees on the resale of the same
    ticket.
        The live event experience has become increasingly out of
    reach for so many fans. One GAO study found that 27 percent of
    the ticket price was the fees. A recent study found that for
    some tickets, it is as high as 75 percent of face value.
        And we also know it affects service. As millions of Taylor
    Swift fans found out last fall, there are few consequences for
    failing to deliver the service. But Taylor Swift--I think it is
    important for our colleagues and all to note--is just one
    example. Whether it is Bruce Springsteen or BTS or Bad Bunny
    or, in the past, Pearl Jam or the Pixies, fans, artists, and
    venues are facing real issues with Live Nation.
        I am hopeful this can be a constructive hearing. The
    purposes of the hearing, one, so the public can find out what
    is happening. Sometimes that on its own gets change. Second,
    investigations are reportedly going on--we have not had that
    confirmed--out of the Justice Department. This is helpful for
    them. And the third reason is that our colleagues on a
    bipartisan basis can work together on legislation.
        Senator Blumenthal has been involved in this issue for many
    years, and we can do something not just to strengthen our
    antitrust laws, which we must do generally, but also
    specifically in the ticketing industry when it comes to
    transparency and resale and the like.
        Restoring competition to our markets is about making sure
    that fans get fair prices and better service. Concert-goers
    today should be able to have the same experiences I had when I
    was in high school, when it did not cost very much to just be
    able to go see a band and remember it forever.
        Thank you.
        Chair Durbin. Thank you, Senator Klobuchar.
        Senator Lee of Utah.

               OPENING STATEMENT OF HON. MICHAEL S. LEE,
                 A U.S. SENATOR FROM THE STATE OF UTAH

        Senator Lee. Thank you, Mr. Chairman, and thank you,
    Chairwoman Klobuchar.
        I am really looking forward to my ongoing service on the
    Antitrust Subcommittee, along with Senator Klobuchar as Chair.
    To be honest, I had hoped, as of a few months ago, to get the
    gavel back. But once again, ``She's cheer captain, and I'm on
    the bleachers.'' So it was nice of----
        Senator Klobuchar. You are a little more than that.
        Senator Lee. Nice of Taylor Swift to have written a song
    about this very situation.
        But all joking aside, this hearing for me is not only about
    the latest ticketing disaster that has made headlines. My
    daughter Eliza might disagree, but there are much bigger issues
    involved than this one event, although that one event is not to
    be discounted and is itself significant.
        The ticketing market in the United States is a complex
    industry involving artists, agents, promoters, venues, primary
    and secondary ticketing companies, and of course, fans, many of
    whom we see outside of our buildings today. As I was driving up
    this morning, I could not help but notice I had never seen more
    smiling and happy demonstrators than I saw today. I think
    Swifties have figured something out. They are very good at
    getting their message across.
        Their messages have come across in many forms over the last
    couple of months, including a letter I received from a young
    woman named Erin Harding in Utah, a young woman who is only 16
    years old. She sent me a letter and an accompanying PowerPoint
    presentation. I think Erin Harding has a bright future ahead of
    her, perhaps as an antitrust lawyer or perhaps in a number of
    other fields as well, but it has been an impressive response.
        We have got to remember that for those who follow antitrust
    policy, the ticketing space in the last few years has also
    offered a natural experiment for evaluating both the efficiency
    claims of merging parties and the Federal Government's efforts
    to protect competition using antitrust laws. Back in 2010, the
    Obama Justice Department Antitrust Division concluded an
    investigation into the then-proposed merger of Ticketmaster,
    the Nation's largest and dominant ticketing provider, and Live
    Nation, the country's largest concert promoter. In a complaint
    alleging that the merger violated the Clayton Act, the
    Department argued that it would eliminate recent, but quickly
    growing head-to-head competition in the marketplace for
    ticketing services.
        However, instead of just stopping the merger, the Obama
    Justice Department in 2010 said that the Department would
    approve it if, and only if, the parties agreed to a proposed
    consent decree. The consent decree that was entered into by
    Ticketmaster and Live Nation addressed two additional concerns.
        First, that the combination of the two companies would
    allow the merged firm to tie the provision of ticketing
    services and concert promotion. In other words, that Live
    Nation could force venues to use Ticketmaster in order to get
    concerts and vice versa. And second, that it might retaliate
    against venues that did not comply with this arrangement.
        Now Ticketmaster will tell you that the settlement
    agreement was something that they were willing readily to enter
    into. They were not bothered by the consent decree at all
    because this would, according to them, essentially be the
    functional equivalent of their offering the sleeves off of
    their vest, and Ticketmaster and Live Nation readily agreed not
    to engage in behavior that the merged firm had no incentive and
    no intention of undertaking. And yet here we are almost 13
    years later faced with a flotilla of allegations and complaints
    that the merged entity has done exactly what it said would
    never happen.
        There are news reports that the Justice Department has
    opened a new investigation into Ticketmaster's conduct, but
    Congress has an important role to play here as well. While DOJ
    undoubtedly wants to know whether Ticketmaster is violating the
    consent decree, Congress should be asking whether the consent
    decree was the right decision in the first place.
        Was the divestiture sufficient to ensure competitive
    pressure on the combined entity of Ticketmaster and Live
    Nation? Were the behavioral remedies capable of preventing that
    very kind of abuse? If the allegations that we are likely to
    hear today are true, if they can be proven, they raise very
    serious doubts about the sufficiency of the DOJ's efforts and
    arguably counsel in favor of a new approach going forward.
        With all that in mind, today is the perfect opportunity to
    do what this Committee is supposed to do--exercise oversight
    over the executive branch's law enforcement efforts and
    consider whether, to what extent, in what ways new legislation
    or perhaps just better enforcement of existing laws might be
    needed to protect the American people.
        I am glad that we are here today, and I look forward to
    hearing from each of our witnesses.
        Thank you.
        Chair Durbin. Thanks, Senator Lee.
        Let me welcome the six witnesses whom I will introduce. Joe
    Berchtold serves as Live Nation Entertainment's president and
    CFO. In this role, Mr. Berchtold oversees finances of the
    world's largest live entertainment and ticketing company. Prior
    to joining Live Nation, Mr. Berchtold was president of
    Technicolor Creative Services at Technicolor and a partner with
    McKinsey and Company, leading their West Coast media practice.
        Jack Groetzinger, co-founder and CEO of SeatGeek, a mobile-
    focused ticketing platform. The company originally launched as
    an aggregator of resale ticket listings but now operates as
    both a primary ticket outlet and secondary marketplace for
    sports teams and live event venues. Prior to co-founding
    SeatGeek, Mr. Groetzinger was an associate counsel with Bain &
    Company.
        Jerry Mickelson is the co-founder of Jam Productions of
    Chicago, a Chicago-based concert promotion agency and one of
    the largest independent producers of live concert entertainment
    in the country. This is a return trip for Mr. Mickelson. He
    testified before the Antitrust Subcommittee in February 2009 at
    a hearing on the then- pending merger of Ticketmaster and Live
    Nation. At the time, he warned us of anticompetitive effects
    the merger could have, stating, quote, ``It is my belief this
    merger is vertical integration on steroids,'' end quote. I look
    forward to hearing an update on his views.
        Sal Nuzzo, senior vice president of the James Madison
    Institute, or JMI, a Tallahassee-based think tank focusing on
    free market economics in Florida. In that role, Mr. Nuzzo
    oversees JMI's policy operation, coalition building, and
    strategy development. His writings have been published in the
    Wall Street Journal, National Review, the Hill, and Newsweek.
        Kathleen Bradish serves as the American Antitrust
    Institute's vice president for legal advocacy. Ms. Bradish,
    prior to joining AAI, worked as counsel for Cleary Gottlieb and
    was an attorney in the Department of Justice's Antitrust
    Division. While at the Department of Justice, she represented
    the Antitrust Division in trade issues, including leading the
    negotiations of competition chapters in the U.S.-Mexico-Canada
    Agreement and in the Transatlantic Trade and Investment
    Partnership.
        Clyde Lawrence is a leader of the band Lawrence and a
    musician, composer, and producer. In December, Mr. Lawrence
    wrote an op-ed in The New York Times titled, ``Taylor Swift's
    Live Nation Debacle Is Just the Beginning.'' In it, Mr.
    Lawrence explained how Live Nation's market dominance
    negatively impacted artists like himself. I look forward to
    hearing his perspective today.
        After I swear in the witnesses, each will have 5 minutes to
    make an opening statement and then turn to Senators' questions.
    As I mentioned, after I have administered the oath, I will pass
    the gavel to Senator Klobuchar to preside over the remainder of
    the hearing.
        First, could all of the witnesses please stand to be sworn
    in?
        Do you affirm the testimony you are about to give before
    the Committee will be the truth, the whole truth, and nothing
    but the truth, so help you God?
        [Witnesses are sworn in.]
        Chair Durbin. Let the record reflect that all of the
    witnesses have answered in the affirmative.
        And before I ask Mr. Berchtold to give his opening
    statement, the ceremonial handing of the gavel.
        Senator Klobuchar. Thank you, sir.
        Chair Durbin. Mr. Berchtold?

       STATEMENT OF JOE BERCHTOLD, PRESIDENT AND CHIEF FINANCIAL
     OFFICER, LIVE NATION ENTERTAINMENT, BEVERLY HILLS, CALIFORNIA

        Mr. Berchtold. Chair Durbin, Ranking Member Graham,
    Senators Klobuchar and Lee, and other Members of the Committee,
    I am Joe Berchtold, president and chief financial officer of
    Live Nation Entertainment. I thank you for the invitation to
    appear today to address these important issues in the live
    entertainment industry so we can together work to make things
    better.
        For almost 20 years, Live Nation has operated in the United
    States and around the world with an ``artist first'' business
    model that is focused on helping put artists on stage and
    connecting them with their fans. We believe that the artist-fan
    connection is the foundation of the live entertainment
    industry, the source of nearly all commercial value, and the
    number one thing that public policy should protect.
        Over this period, we have helped the industry grow rapidly.
    In 2022, live music was a $12 billion industry in the United
    States, 4 times what it was in 2005. To fuel this growth, Live
    Nation has invested billions of dollars funding artists
    globally, $9 billion in 2022 alone.
        Given our level of investment in artists, it is also
    critical for Live Nation to have the most effective platform
    possible for selling tickets. Since our 2010 merger with
    Ticketmaster, we have invested over $1 billion in capital to
    improve the Ticketmaster system. Much of this was on
    technologies to eliminate fraud and to get tickets to fans
    instead of ticket scalpers using bots, a prime example of which
    is our Verified Fan service.
        Today's Ticketmaster is best in class in conducting large
    on-sales, marketing concerts, preventing frauds, and getting
    tickets into the hands of real fans.
        I do want to take a moment to address some confusion about
    what Ticketmaster and other primary ticketing platforms do and
    do not do. Primary ticketing companies, including Ticketmaster,
    do not set ticket prices. We do not decide how many tickets go
    on sale and when, and we do not set service fees. Pricing and
    distribution strategies are determined by the artists and their
    teams.
        Service fees, even if they are called ticketing fees, are
    retained mainly by the venues. And their portion of the service
    fee that Ticketmaster retains has been falling steadily over
    time. This leads to the topic of today's hearing, competition
    in ticketing markets.
        We hear people say that ticketing markets are less
    competitive today than they were at the time of the Live
    Nation-Ticketmaster merger. That is simply not true. In 2009,
    the Department of Justice alleged that Ticketmaster's market
    share was over 80 percent. It is a different story today. The
    most obvious change is the emergence of the enormous secondary
    ticketing market in which Ticketmaster has a modest market
    share and many strong competitors.
        But also in primary ticketing, the Ticketmaster of 2010 did
    not face the level of competition that we face today with new
    competitors highly capitalized, including SeatGeek, AEG's AXS,
    and Eventbrite, along with established competitors, including
    Tickets.com and Paciolan. Ticketmaster has lost, not gained,
    market share since the merger. And as I mentioned, today's
    competitive bidding process with numerous credible alternative
    ticketing companies results in getting less of the economic
    value in a ticketing contract every year.
        There are problems in the ticketing industry, problems we
    believe can and should be addressed through legislation. Many
    are the direct result of industrial-scale ticket scalping that
    goes on today, a $5 billion industry in concerts alone in the
    United States fueled by practices that run counter to the
    interests of artists and their fans.
        The recent on-sale experience with Taylor Swift, one of the
    world's most popular artists, has highlighted the need to
    address these issues urgently. We knew bots would attack that
    on-sale and planned accordingly. We were then hit with three
    times the amount of bot traffic that we had ever experienced,
    and for the first time in 400 Verified Fan on-sales, they came
    after our Verified Fan password servers as well.
        While the bots failed to penetrate our systems or acquire
    any tickets, the attack required us to slow down and even pause
    our sales. This is what led to a terrible consumer experience,
    which we deeply regret. We apologize to the fans. We apologize
    to Ms. Swift. We need to do better, and we will do better.
        Ticketmaster learned valuable lessons from this on-sale. In
    hindsight, there are several things we could have done better,
    and let me be clear that Ticketmaster accepts its
    responsibility as being the first line of defense against bots
    in our industry. It is an ever-escalating arms race. But in
    this forum, where we are here to discuss public policy, we also
    need to recognize how industrial scalpers using bots and cyber
    attacks to unfairly gain tickets has contributed to this awful
    experience.
        There are many things we can and should accomplish
    together. We should enlarge the scope of the BOTS Act and
    increase enforcement. We should enact categorical prohibitions
    on fraudulent ticket practices, including deceptive URLs and
    offering for-sale tickets before they are on sale on the
    primary. We should mandate all-in pricing so that fans see the
    full cost of their tickets from the start.
        We share your goal of making the live entertainment
    industry better for artists, teams, and fans alike, and it is
    in that spirit that I sit before you today to work with you to
    make the fan experience better.
        I look forward to answering your questions.
        [The prepared statement of Mr. Berchtold appears as a
    submission for the record.]
        Chair Durbin. Mr. Groetzinger?

        STATEMENT OF JACK GROETZINGER, CHIEF EXECUTIVE OFFICER,
                      SEATGEEK, NEW YORK, NEW YORK

        Mr. Groetzinger. Good morning, Chairman Durbin, Ranking
    Member Graham, Senators Klobuchar and Lee, and Members of the
    Committee.
        My name is Jack Groetzinger. I am the co-founder and CEO of
    SeatGeek. And like so many millions, I am a fan. I grew up in
    Cleveland, Ohio, and my happiest childhood memories are going
    to see Cleveland Crunch games with my dad. That is an indoor
    soccer team. Seeing Cavs games with friends.
        My co-founders and I started SeatGeek because we believe
    profoundly in the power of live events as these magical things
    that create incredible moments and yet believe that the
    experience of actually buying tickets is very much the
    opposite--antiquated, ripe for innovation. I have spent the
    last 13-plus years working in this industry, and there are 3
    things that are clear to me and are clear to many others who
    work in live entertainment.
        Number one, a lack of robust competition in our industry
    meaningfully stunts innovation, and consumers are who suffer.
    Number two, venues fear losing Live Nation concerts if they do
    not use Ticketmaster. And number three, the only way to restore
    competition in this industry is to break up Ticketmaster and
    Live Nation.
        Some quick background on SeatGeek. We started the company
    in 2009, and initially, as was mentioned, we were a search
    engine that allowed users to search across a lot of sites. The
    company evolved. It grew over time, and importantly to this
    discussion, in 2016, we entered the primary ticketing market.
        Throughout our evolution, we have maintained intense focus
    on consumers. We have launched many industry-first features
    that make it easier and more affordable for fans to go to
    events. I am super proud of all of the work that we have done
    at SeatGeek, but I also recognize the ongoing challenges that
    face our industry, some of which have recently been front page
    news.
        The best way to address those challenges is to ensure there
    is robust competition where businesses and consumers can select
    the best products and services based on their merits. That does
    not happen today. It does not happen because Live Nation
    controls the most popular entertainers in the world, routes
    most of the large tours, operates the ticketing systems, and
    even owns many of the venues.
        This power over the entire live entertainment industry
    allows Live Nation to maintain its monopolistic influence over
    the primary ticketing market. As long as Live Nation remains
    both the dominant concert promoter and ticketer of major venues
    in the U.S., the industry will continue to lack competition and
    struggle.
        As discussed, Live Nation Entertainment is the product of
    the 2010 merger of Ticketmaster and Live Nation, and as also
    mentioned, they entered into a consent decree, which banned
    Ticketmaster from threatening or retaliating against venues by
    withholding Live Nation concerts. That did not work. It has not
    worked at all.
        The DOJ's 2009 investigation confirmed that Live Nation had
    violated the consent decree repeatedly almost since its
    inception. The DOJ identified numerous examples of Live Nation
    threatening and retaliating against venues that did not
    contract with Ticketmaster.
        Today, Ticketmaster's estimated market share is over 70
    percent of the U.S. primary ticketing market. Ticketmaster is
    the primary ticketing provider for more than 80 percent of the
    NBA, NHL, and NFL teams. Live Nation is also the largest
    promoter of major concerts in the world, promoting more than 73
    percent of the top 25 tours in the U.S. in 2021.
        It is no mystery why no other company has significantly
    penetrated the primary ticketing market. Major venues in the
    U.S. know that if they move their primary ticketing business
    from Ticketmaster, they risk losing revenue they earn from Live
    Nation concerts. They know this because Live Nation has told
    them so, directly and indirectly, through its public
    pronouncements, private communications, and subsequent
    retaliation against venues that have signed deals with a
    competitor.
        The DOJ found that as a consequence of Live Nation's
    conduct, quote, ``Venues throughout the United States have come
    to expect that refusing to contract with Ticketmaster will
    result in the venue receiving fewer Live Nation concerts or
    none at all,'' unquote.
        Our industry provides a cautionary tale about how
    behavioral remedies cannot solve the problems inherent in an
    anticompetitive merger. The only effective remedy now is a
    structural one, the dissolution of the common ownership of
    Ticketmaster and Live Nation. To improve our industry, we must
    restore competition. At SeatGeek, we deeply care about the live
    event industry and believe it is time to give fans, teams,
    artists, and venues alike the choices they deserve.
        It is a privilege to be included in this discussion. Thank
    you so much for your time and attention.
        [The prepared statement of Mr. Groetzinger appears as a
    submission for the record.]
        Senator Klobuchar [presiding]. Thank you very much, Mr.
    Groetzinger.
        And next up, we have with us Mr. Mickelson. Thank you, and
    thank you for your work you do with the Palace in St. Paul,
    Minnesota.

       STATEMENT OF JERRY MICKELSON, CHIEF EXECUTIVE OFFICER AND
           PRESIDENT, JAM PRODUCTIONS, LLC, CHICAGO, ILLINOIS

        Mr. Mickelson. Thank you, Senator. Thank you, Chairman
    Durbin, Ranking Member Graham, Senator Klobuchar, and Senator
    Lee, along with all the other Members of the Senate Judiciary
    Committee, for allowing me to appear before you today.
        I am here to speak on behalf of my colleagues, fellow
    promoters, and most importantly, the concert fans. My
    appearance before you is based on my 50 years of experience in
    the live entertainment industry. For the record, my name is
    Jerry Mickelson, CEO and president of Jam Productions, a
    company that has produced and promoted events since 1972.
        As a primer for those who may not know, let me briefly talk
    about the job of promoters. We work with agents and managers to
    route tours into markets across the country. We make guaranteed
    payment to artists, contract with the venue to hold the event,
    market the show, put tickets on sale, and produce the show. We
    pay all the costs and assume all the risks.
        When Live Nation loses money on a concert, they can make up
    for that with operating income from ticketing and sponsorships.
    We cannot do that. We do not have those. Pepsi does not earn
    money from Coke, but our competitor Live Nation earns money
    from selling tickets to our concerts.
        In 2009, I appeared in front of the Committee to testify
    about the proposed merger of Live Nation and Ticketmaster. At
    that hearing, I stated the unification of these two goliaths
    would create a business with extraordinary market power and
    clout unlike any that I have ever seen in my lifetime.
        I testified that if this merger was allowed to produce--
    proceed, the combined entity would have the ability to suppress
    or eliminate competition in many segments of the industry.
    Today, we know with certainty that this merger is vertical
    integration on steroids, using dominance in one market to
    expand its power and dominance in another, cutting out the
    competition and harming the consumers.
        From my vantage point, the arena-level concerts used to be
    Jam's most profitable segment of the business because that is
    where we earn our money. In 1996, Jam produced 100 concerts in
    arenas, but in 2011, 1 year after the merger, that decreased to
    46 concerts. And in 2022, we only produced 14 arena concerts.
    Live Nation went after the arena business, and they succeeded
    in driving us and other independent promoters out of that
    sector.
        Live Nation effectively eliminated competition for indoor
    arena shows by utilizing the following methods: purchasing
    national indoor tours in arenas and for their outdoor
    amphitheaters; threatening financial penalties on a tour deal
    if the artist wanted to work for Jam; paying a band 100 percent
    or more of the gross ticket sales; and Live Nation-managed
    artists typically only perform for Live Nation-promoted shows
    at the arena level.
        Now Live Nation is going after music theaters and clubs of
    all sizes in an effort to control the entire live music
    industry from the top to the bottom. From 2010 to 2021, Live
    Nation added 61 theaters and 41 clubs to their already large
    arsenal of venues. The near complete domination of arenas
    because of the merger could soon happen in theaters and clubs
    in every community in the country.
        On a 2016 Live Nation earnings call, Michael Rapino, their
    president and CEO, said one of the company's biggest goals was
    to convince artists to agree to integrate the primary and
    secondary ticket markets to grow Live Nation's share. Rapino
    stated, and I quote, ``Artists, the more they get comfortable
    with seeing primary and secondary together, our market share
    grows.'' With that statement, Rapino acknowledged that they are
    not serving artists. They are serving themselves.
        There are two antitrust decisions I would like to bring to
    your attention where vertical integration played a prominent
    role in restricting competition. The 1948 Supreme Court
    decision in the U.S. v. Paramount led to the abolishment of
    block booking and forced the movie studios to sell off their
    theater chains. An excerpt from the Eastman Kodak case states,
    ``the Court has held many times that power gained through some
    advantage can give rise to liability if a seller exploits his
    dominant position in the market to expand his empire into the
    next.''
        Every time that Live Nation or Ticketmaster blames anybody
    else for the significant issues and increasingly high fees,
    remember that many times they are the venue, the promoter, and
    the manager of that artist. By controlling ticketing and
    promotion, the artist's management company, they are choking
    off competition that would offer an alternative to the broken
    system we see today. This was most acutely seen in Taylor
    Swift, and it is playing out across the live music industry
    every day and generating fan outrage and despair.
        Thank you for your time, and I look forward to answering
    your questions.
        [The prepared statement of Mr. Mickelson appears as a
    submission for the record.]
        Senator Klobuchar. Thank you very much, Mr. Mickelson.
        Next up, Mr. Nuzzo.

       STATEMENT OF SAL NUZZO, SENIOR VICE PRESIDENT, THE JAMES
                MADISON INSTITUTE, TALLAHASSEE, FLORIDA

        Mr. Nuzzo. Madam Chairwoman, Members of the Committee, I
    would like to thank you for the honor and the opportunity to
    appear before you this morning.
        My name is Sal Nuzzo, and I serve on the policy team at the
    James Madison Institute in Tallahassee, Florida. We are a
    nonprofit economic policy think tank that focuses on the policy
    issues impacting Florida's 22 million residents.
        Fresh out of college and starting a career in policy, I
    dreamt of one day testifying before the United States Senate on
    an issue of profound importance, maybe international monetary
    policy or perhaps a Supreme Court nomination. But as my 14- and
    13-year-old daughters informed me last night, ``Dad, nothing
    you speak on in your career will be as important as what you
    say today. Don't mess this up.''
        So here we go. Florida is home to 13 major sports teams, 15
    Major League Baseball spring training facilities, NASCAR, F1,
    the PGA, LPGA, college, and numerous other sports venues. I say
    that because most of those venues serve as concert sites when
    they are not in use during their respective seasons. In
    Florida, sports and live entertainment is a $6.5 billion
    market, a sizable share of the Nation's $133 billion economic
    impact in this area.
        So this issue is important to Floridians not just with
    respect to primary ticketing, but also the secondary ticket
    market, which I would like to open with. I would like to offer
    our perspective by way of a brief analogy.
        Because I am an employee of a nonprofit organization, I
    drive a 15-year-old Volvo with 200,000 miles on it. God bless
    the Swedes. I purchased it from a private seller in 2015, and
    much to my kids' dismay, it is still going strong.
        Volvo did not place a single restriction on the automobile
    when I purchased it, and with and when I decide to sell it,
    they will likely have no role in the transaction. In fact, I do
    not think they have a clue what has happened to the car since
    it left their dealership. This is true for just about every
    auto manufacturer. Consequently, our auto market is a robust,
    thriving, and diverse industry largely adhering to the forces
    of supply and demand.
        The same could be the case for the market governing the
    selling, marketing, and resale of tickets to sports
    competitions and concerts. It could be, but it has not
    occurred. There is, as we have spoken about, one dominant
    market player approaching 80 percent of the primary market.
    This does allow them the ability to leverage that dominance
    through service fees, exclusivity requirements, and other
    practices that are ultimately borne by consumers.
        At its core, a debate is occurring over what a person
    actually obtains when they purchase a ticket. Some would argue
    that the purchaser is simply leasing or renting a space in a
    venue and that the lease is subject to terms and conditions. In
    our opinion, that logic rests on a misguided assumption that
    the commodity is the venue.
        Ask anyone attending a Jaguars game, or a Harry Styles
    concert for that matter, where they are going, and they will
    reply, ``I am going to the Jags game,'' or ``I am going to take
    my daughters to see Harry Styles.'' They would not reply with,
    ``Oh, I am going to TIAA Bank Field this afternoon,'' or ``Just
    taking my kids to Amway Arena tonight.''
        The stadium may have a life span of 50 years, but an
    individual purchases a commodity with a much more limited life
    span, a couple of hours. This distinction, in our opinion, is
    vital to the debate over the issues within the event ticketing
    space.
        Over the last several years, we have heard the term
    ``consumer welfare standard'' uttered much more frequently.
    Questions over whether the standard is still applicable in
    today's innovation economy, whether it should be replaced with
    some other form of subjective measure, and in the age of tech
    platforms what consumer welfare even means. I would ask you all
    today as we conduct this hearing to set that principle aside.
    In this area, we would contend that consumer welfare is very
    clearly defined and reflective of the issues and challenges
    within this industry.
        Those representing the dominant player in the market would
    contend that their growth has allowed them to innovate and make
    advances that greatly benefit consumers. A few million Taylor
    Swift fans would respond, ``This is why we can't have nice
    things.''
        To be clear, from our perspective the issue is not the
    Taylor Swift crash, per se. That merely revealed how a lack of
    competition over time has corroded innovation and distorted the
    market. I would ask, suppose a robust, vibrant, and competitive
    market for ticketing had been allowed to evolve and innovate
    over the last 20 years, would the Taylor Swift crash have
    occurred? It is a hypothetical, of course, but absolutely one
    worth considering.
        I will conclude my remarks with a call to you as
    policymakers. On this topic, in this arena, consumer welfare is
    very clear to define, and there are actual harms to consumers
    from anticompetitive practices.
        Thank you to all, and I appreciate the opportunity to be
    before you today.
        [The prepared statement of Mr. Nuzzo appears as a
    submission for the record.]
        Senator Klobuchar. Thank you very much, Mr. Nuzzo.
        And next up, Ms. Bradish.

        STATEMENT OF KATHLEEN BRADISH, VICE PRESIDENT FOR LEGAL
         ADVOCACY, AMERICAN ANTITRUST INSTITUTE, WASHINGTON, DC

        Ms. Bradish. Thank you, Chairman Durbin, Ranking Member
    Graham, Senators Klobuchar and Lee, and Members of the
    Committee.
        It is an honor to be here today to lend the American
    Antitrust Institute's perspective to the issue of competition
    in live entertainment. AAI applauds Senate lawmakers for
    turning their attention to a serious competition issue that
    hurts concert-goers, artists, and smaller competitors across
    the live entertainment industry. There are a few major points
    and policy recommendations that I would like to highlight
    today.
        First, Live Nation-Ticketmaster is an example of, on one
    hand, a very traditional monopoly in the mode of Standard Oil
    and, on the other, a 21st century digital player like other
    online platforms dominating an ever-widening swath of its
    industry. Its dominance in markets up and down the live
    entertainment supply chain creates the incentive and the
    ability to limit competition to protect its market position.
        On the concert side, this includes excluding smaller or
    independent concert promoters and venues. In digital ticketing,
    this includes excluding ticket resellers and brokers who
    provide important competition via the secondary ticketing
    market.
        Customers pay the price for these monopolistic acts with
    higher ticket prices and fees, lower quality, less choice, and
    less innovation. Artists who lack the blockbuster power of a
    Swift or a Springsteen lose out. Smaller rivals in the supply
    chain also lose out.
        Second, we should learn from the failure of the conduct
    remedies that were a condition of the DOJ's clearance of the
    2010 merger of Live Nation and Ticketmaster. A lengthy DOJ
    investigation concluded in 2020 that Live Nation-Ticketmaster
    repeatedly violated the requirements of the consent decree.
    Unfortunately, rather than seeking an effective structural
    remedy, DOJ simply amended some of the language in the consent
    decree and extended the decree for another 5\1/2\ years. The
    amended decree did nothing to change Live Nation-Ticketmaster's
    anticompetitive incentives.
        This current DOJ has recognized the ineffectiveness of
    behavioral remedies that run counter to a company's incentives.
    DOJ should pursue new enforcement action to obtain effective
    structural relief. This could be through a consummated merger
    challenge under Section 7 of the Clayton Act or a
    monopolization case under Section 2 of the Sherman Act.
    Separating ticketing from promotion and venues would eliminate
    the incentives to stifle competition, and reducing the market
    share of Ticketmaster through spinoffs would address
    Ticketmaster's incentives to limit competition in secondary
    ticketing.
        Protecting consumers, artists, and smaller rivals from Live
    Nation-Ticketmaster's harmful conduct will require multiple
    policy tools, including strong antitrust enforcement against
    Live Nation-Ticketmaster and legislative action. AAI urges
    enforcers and lawmakers to consider three major features of a
    multipronged approach to the Live Nation-Ticketmaster monopoly
    problem.
        First, consider standards that enable the agencies to
    challenge vertical mergers as effectively as horizontal
    mergers. The incipiency standard in Section 7 of the Clayton
    Act is designed to prevent all mergers that may enhance market
    power and lead to anticompetitive effects.
        We currently have a structural presumption for horizontal
    mergers. We badly need a presumption for vertical mergers
    either through legislative action or new antitrust guidelines
    that get adopted by the courts.
        Second, support more vigorous antitrust enforcement with
    legislation designed to strengthen and clarify the U.S.
    antitrust laws. Senator Klobuchar's proposed Competition and
    Antitrust Law Enforcement Reform Act is a leading example. The
    bill would, among other things, update legal standards for
    mergers and strengthen the standard for prohibiting
    exclusionary conduct by dominant firms. Such reforms would
    reduce the formidable burdens on the Government for bringing
    monopolization and merger cases.
        Finally, consider the merits of an oversight regime to
    facilitate access to and transparency in ticketing. Dominant
    digital platforms can engage in practices designed to sell
    preference, such as steering music fans to Ticketmaster's
    proprietary ticketing services. Solutions to these problems may
    well require establishing rules of the road or codes of conduct
    for digital ticketing platforms. Such legislation has been
    proposed at both the State and Federal level.
        Thank you for the opportunity to testify today, and I look
    forward to your questions.
        [The prepared statement of Ms. Bradish appears as a
    submission for the record.]
        Senator Klobuchar. Thank you very much.
        And last, but not least, is Clyde Lawrence of the band
    Lawrence. And I will say looking at your testimony ahead of
    time, Mr. Lawrence, I particularly enjoyed the line that
    perhaps you will repeat that while you are so proud of your
    band, ``We are not artists yet on the level of acts like Taylor
    Swift or Bruce Springsteen, though we do hope one day to be big
    enough to crash a ticketing website.''
        With that, I turn it over to you, Mr. Lawrence.

     STATEMENT OF CLYDE LAWRENCE, SINGER-SONGWRITER, LAWRENCE, NEW
                             YORK, NEW YORK

        Mr. Lawrence. Thank you. I hope it will get as big a laugh
    when I say it as when you just did.
        Good morning, Senators, and thank you for inviting us today
    to the most unique gig we have had in years.
        My name is Clyde Lawrence, and this is Jordan Cohen. We are
    two of the eight members of Lawrence, a soul-pop band from New
    York City.
        Before telling you more about who we are, it is important
    to clarify who we are not. We are not lawyers or economists
    with expertise in antitrust policy. And as Senator Klobuchar
    said, we are also not artists on the level of acts like Taylor
    Swift or Bruce Springsteen, though we do hope to one day be big
    enough to crash a ticketing website.
        What we are, however, are seasoned artists who have toured
    extensively over the last 7 years, starting with empty bars,
    then working our way up to headlining sold-out shows for
    thousands of people, and seeing our music chart on Top 40
    radio. While we became musicians because of our passion for
    making music, we realized early on that we needed to embrace
    the entrepreneurial aspects of pursuing careers as artists.
        Ever since we started touring, we have tried to be vocal
    about the lopsided deal mechanics we were facing, even
    including the lyric ``Live Nation is a monopoly'' in our latest
    album. Whether or not it meets the legal definition of a
    monopoly is someone else's call to make. We are here just to
    tell you what we have observed.
        While Jordan and I discuss those dynamics in depth in our
    written testimony, most of the issues we face stem from the
    fact that Live Nation-Ticketmaster often acts as three things
    at the same time--the promoter, the venue, and the ticketing
    company. Let us imagine we just played a sold-out show at a
    venue Live Nation owns and operates. When an artist plays these
    venues, they are required to use Live Nation as the promoter.
        Far from simply advertising, the promoter coordinates and
    pays the upfront cost to put together a concert, such as
    renting and staffing a venue and striking a deal with the
    performer. Since both our pay and theirs is a share of the
    show's profits, we should be true partners aligned in our
    incentives: Keep costs low while ensuring the best fan
    experience. But with Live Nation not only acting as the
    promoter, but also as the owner and/or operator of the venue,
    it seriously complicates these incentives.
        At the end of the show, costs will have eaten into most of
    the money made that evening, and due to Live Nation's control
    across the industry, we have practically no leverage in
    negotiating them. If they want to take 10 percent of the
    revenues and call it a facility fee, they can and have. If they
    want to charge $30,000 for the house nut, they can and have.
    And if they want to charge us $250 for a stack of 10 clean
    towels, they can and have.
        Once these costs, some of which went to Live Nation
    subsidiaries, are taken into account, the remainder is split
    between Live Nation and the band. In a world where the promoter
    and the venue are not affiliated with each other, we can trust
    that the promoter will look to get the best deal from the
    venue. However, in this case, the promoter and the venue are
    part of the same corporate entity, so these line-items are
    essentially Live Nation negotiating to pay itself. Does that
    seem fair?
        The tickets were listed at $30, and our pay ended up
    shaking out to about $12 of each ticket. But in this
    hypothetical show, the fan did not pay $30 for that ticket. The
    fan paid $42 because Ticketmaster tacked on a 40 percent fee.
    And for the record, we have had them go as high as 82 percent.
        As with promotion, if an artist plays at a Live Nation
    venue, the artist has no choice but to have the show ticketed
    by Ticketmaster. And to be clear, we have absolutely zero say
    or visibility in how much these fees will be. We find out the
    same way as everyone else, by logging on to Ticketmaster once
    the show already goes on sale. And in case you are wondering,
    no, we the artists do not get a cent of that fee.
        So of the $42 a fan spent on a ticket, we receive $12. But
    whereas Live Nation's costs were already covered at this point
    in the calculation, we still need to pay for our touring costs.
    In our case, roughly 50 percent of our earnings is used to
    cover expenses. So that leaves us with $6 for an 8-piece band
    pretax, and we also have to pay our own health insurance.
        To be fair, many of the issues we have addressed here are
    not exclusive to Live Nation-Ticketmaster, and we have had a
    number of positive experiences with parts of Live Nation. Their
    venues are often filled with hard-working and passionate
    people, and most importantly, we love that all of their venues
    have one consistent Wi-Fi network and password. That one is a
    real game-changer.
        Jokes aside, we truly do not see Live Nation as the enemy.
    They are just the largest player in a game that feels stacked
    against us as artists and often our fans as well.
        Ultimately, when looking at the current state of the
    industry, we are left with lots of questions. Why is it that
    all of Live Nation's costs get recouped before the show hits
    its profit point, yet ours, the artists', don't? Why is there
    so little transparency as to what line-items, such as facility
    fees, actually go towards?
        Why is it standard for Live Nation to take a 20 percent
    commission on our merchandise sales while we never receive a
    cent of their ancillary revenues like concessions, alcohol, and
    parking? Finally, why is Live Nation allowed to freely set
    exorbitantly high ticket fees without any transparency or input
    while in other industries the Government has mandated caps on
    various types of junk fees?
        We look forward to seeing these questions get some answers.
    Thank you for your time, and we hope to see some of you at one
    of our band's concerts. If you would like to come, let me know,
    and I will throw you on the guest list to help you avoid the
    ticket fees.
        [The prepared statement of Mr. Lawrence appears as a
    submission for the record.]
        Senator Klobuchar. Thank you very much, Mr. Lawrence. I
    think we are willing to pay, but we really appreciate your
    testimony.
        [Laughter.]
        Mr. Lawrence. It is on us.
        Senator Klobuchar. Okay. With that, I am going to turn it
    over for the first round of questioning to our Chair, Senator
    Durbin.
        Chair Durbin. Thanks, Senator Klobuchar.
        Mr. Lawrence, I am going to stick with you for a minute
    because you made it clear that you do not set the ticket price,
    and Mr. Berchtold said he does not have anything to do with the
    ticket price. Who does set the ticket price?
        Mr. Lawrence. That is an excellent question. That was
    actually the thing I was most surprised to hear in Mr.
    Berchtold's speech because we definitely have absolutely no
    say. And if we actually ask the venues in advance, which we
    often do, they say that is a Ticketmaster thing. So the fees, I
    mean.
        We actually do set, sorry, the ticket prices. The base
    price the artist does have a say in setting for sure. But those
    added Ticketmaster service fees we have absolutely no say, and
    the venues claim that it is a Ticketmaster thing.
        Chair Durbin. Mr. Berchtold, do you want to add anything to
    that?
        Mr. Berchtold. Thank you. Yes.
        As Mr. Lawrence said, the band sets the ticket price. The
    service fee level is set by the venue. I----
        Chair Durbin. You control the venue.
        Mr. Berchtold. In----
        Chair Durbin. Do you not?
        Mr. Berchtold. Of approximately----
        Chair Durbin. Live Nation?
        Mr. Berchtold. Of approximately 4,000 venues in the United
    States, per Pollstar, Live Nation operates approximately 200.
    So roughly 5 percent of the venues in the country.
        Chair Durbin. Are they the biggest?
        Mr. Berchtold. No, sir. They are generally not, not the
    biggest. The biggest tend to be the sports venues, the arenas,
    the stadiums controlled by the sports teams or the owners of
    the sports teams.
        Chair Durbin. Mr. Groetzinger, you had an experience at
    Barclays, did you not, in terms of an opportunity for your
    company to take over a venue that had been controlled by
    Ticketmaster. How did that work?
        Mr. Groetzinger. The New York Times reported a few weeks
    ago how once we took over ticketing for the Barclays Center in
    Brooklyn, the Barclays Center saw a marked decrease in the
    number of concerts from Live Nation that were sent to that
    venue versus historical averages. So earlier, last year, the
    Barclays Center management came to us and said we would like to
    keep using you for ticketing our basketball, but we want to be
    able to use Ticketmaster to ticket concerts. And we looked into
    it and could not get the economics to work. So we said to them,
    listen, let us just part ways amicably, and we did.
        Chair Durbin. So they used their power of the marketplace
    to diminish the number of acts at that venue, and the venue
    decided they had to go back to Ticketmaster?
        Mr. Groetzinger. There was certainly, as Pollstar public
    data shows, a marked increase in the number of shows Live
    Nation played at that venue after the venue decided to move
    away from Ticketmaster.
        Chair Durbin. Mr. Berchtold, is that true?
        Mr. Berchtold. I believe, Senator, that what The New York
    Times indicated was that another venue opened in the
    marketplace. So you now had two venues vying for the shows that
    were not going to Madison Square Garden and that the number of
    shows going to Barclays from all the major promoters went down
    as a result of that increased competition. I have not heard of
    any allegations that we changed in any way our booking of
    concerts for that venue.
        It is a matter that I watch very closely, given the profile
    of the New York market. I understand every decision about every
    show, where it was placed and why. We have records determining
    that in no cases was there any retaliation against Barclays in
    the placement of shows.
        Chair Durbin. Mr. Groetzinger, last word on Barclays?
        Mr. Groetzinger. I do not have more to add specifically on
    retaliation there. I would note that the DOJ report in 2019
    found numerous instances of Live Nation threatening and
    retaliating against venues once they had moved away from
    Ticketmaster. In one case, the Live Nation president told the
    venue that they would, quote, unquote, ``go nuclear'' if they
    left.
        So the threat is real. It has been documented. It happens
    across many venues.
        Chair Durbin. Mr. Mickelson, Mr. Berchtold defended his
    market position in one element, saying it was the battle of the
    bots. Have you run into that phenomena?
        Mr. Mickelson. A ticketing company's--one of the things
    they are supposed to do is have solutions to bots. And for the
    leading ticket company not to be able to handle bots is, for
    me, pretty--an unbelievable statement. But you cannot blame
    bots for what happened to Taylor Swift. There is more to that
    story that you are not hearing.
        Chair Durbin. Ms. Bradish, you probably heard Mr.
    Berchtold's suggestions and read in his testimony three things
    he thinks need to be done, which included all-in pricing on the
    tickets, fighting deceptive URLs as an example, and creating a
    civil action under the BOTS Act. Any reaction from you to those
    suggestions?
        Ms. Bradish. Well, none of those suggestions goes to the
    core of what we have been talking about today, which is the
    antitrust problem, the fact that Live Nation-Ticketmaster,
    because of its market power, has the incentive to do things to
    exclude competition in all of its markets up and down the
    supply chain for live entertainment.
        So I appreciate those suggestions. Many of them may be good
    ideas, but it does not change the fact that Live Nation-
    Ticketmaster is a monopoly and will act because that is its
    incentive to exclude competition.
        Chair Durbin. Thank you, Madam Chair.
        Senator Klobuchar. Thank you very much, Senator Durbin.
        Next up, Senator Lee.
        Senator Lee. Thank you, Madam Chairman.
        Ms. Bradish, I would like to start with you. Back in 2010,
    the antitrust complaint filed by the Department of Justice
    against the proposed merger between Ticketmaster and Live
    Nation alleged, among other things, that Ticketmaster had at
    the time an 83 percent market share with no competitor, no
    single competitor having more than 4 percent of the market. It
    also alleged that Live Nation, for its part, was Ticketmaster's
    biggest customer and was the leading concert promoter at the
    time, of course.
        It also alleged that Live Nation had begun competing
    directly with Ticketmaster for ticketing services, rising over
    a very short period of time to 16 percent of the market share,
    in just 2 months, a kind of a meteoric rise. So with that in
    mind, why, in your view, did the Department of Justice settle
    what seems to be a strong case that appears to involve the
    elimination of head-to-head competition with a monopolist? And
    would you agree that what we have here is not a shortcoming
    necessarily of our antitrust laws, but error, perhaps gross
    negligence in enforcing them?
        Ms. Bradish. Well, I think that there are two elements to
    why the DOJ would take a consent decree rather than pursue a
    case in court. Obviously, a case in court involves risk, and
    the fact is that to pursue a vertical merger in court--and
    recent experience backs that up--is difficult. It is very
    difficult for DOJ to win a vertical merger case.
        Senator Lee. You mean post-Dr. Miles?
        Ms. Bradish. Mm-hmm.
        Senator Lee. Yes.
        Ms. Bradish. Yes, so that it is hard, given the current
    state of the law, for DOJ to pursue a vertical merger case. So
    that will make them in many cases hesitant to do that.
        Senator Lee. Right.
        Ms. Bradish. The second issue I think that comes up here is
    the need for witnesses in a court case. And in a situation
    where there is a pervasive fear of the dominant firm, where
    venues and promoters and other independent rivals have--will
    potentially suffer consequences--and history since then
    suggests that that is the case--they would have to testify in
    court. And to get someone to take that risk is not an easy ask.
        Senator Lee. The point about Dr. Miles and Leegin is
    interesting, although if I am not mistaken, they pitched this
    as a horizontal merger, did they not? Did not the complaint
    identify it as a horizontal, not a vertical?
        Ms. Bradish. Well, there is a horizontal component as well
    as a vertical component. The remedy--the conduct remedy part of
    it clearly goes to the vertical part of the issue.
        Senator Lee. Now the consent decree includes a divestiture
    and also prohibitions on tying--on tying the ticketing services
    and the concert promotion. You want to say anything about how
    those have worked in practice and why?
        Ms. Bradish. Well, obviously, the investigation that
    culminated in the 2020 modification to the consent decree
    showed that, in fact, this was repeatedly violated. The DOJ
    described six instances but also pointed to a pervasive
    environment of fear of retaliation. And as a result, it shows
    that when a company has incentives to act in a particular way,
    a consent decree is not necessarily going to stop them from
    doing that.
        Senator Lee. Right. Mr. Berchtold, do you want to respond?
        Mr. Berchtold. Yes. I absolutely acknowledge, Senator, that
    the Department of Justice alleged six issues in 2019, which led
    to our decision with them to extend the consent decree. We did
    not feel it made sense to be seen as defending the theories of
    retaliation or threats. It is not our business practice. It
    goes against our fundamental focus on alignment with the
    artist, the idea that we would ever put our interests ahead of
    theirs. So we were comfortable extending the consent decree.
        As she mentioned, there were several things that changed
    because we had different interpretations, and one of the things
    that we have done is, is in instances where venues are seeking
    to tying a ticketing and a content--and a concert agreement
    into an overall deal, we have eliminated those so that there
    cannot be any instance where there is the perception of threats
    or retaliation associated with that bundling done at the
    venue's request. So we have simply eliminated that from our
    service set, along with the establishment of monitors to make
    sure that any venue employee or others could confidentially
    report any issues.
        Senator Lee. Is it accurate to say that at a minimum, that
    Live Nation at a minimum was a motivated and capable
    potentially, if not likely, competitor?
        Mr. Berchtold. I am sorry? I----
        Senator Lee. At the time of the merger.
        Mr. Berchtold. Oh, oh.
        Senator Lee. Is it accurate to say that at the time of the
    merger, Live Nation was an emerging nascent competitor and
    likely a very capable potential competitor?
        Mr. Berchtold. I would say, Senator, that Live Nation at
    the time was finding that it was very difficult to build its
    own ticketing system, that one of the driving motivations to
    the Ticketmaster merger was the feeling that it was not going
    to successfully build its own system, and it sought to find one
    that could more effectively serve its needs of selling tickets
    for fans.
        Senator Lee. Yes. I am out of time, but you know, they had
    sold 6 million tickets, and they did rise to a pretty prominent
    position in the marketplace in 2 months. So that is not
    nothing. We will get to that later.
        Thank you, Madam Chair.
        Senator Klobuchar. Thank you very much.
        I will start with you, Ms. Bradish. As a former antitrust
    attorney who studied these markets, do you agree that the
    ticketing market was more competitive when Ticketmaster was
    competing with Live Nation as separate companies?
        Ms. Bradish. Certainly. And especially where you have a
    potential--a new entrant that is showing the ability to
    increase its market share rapidly and with great success, that
    is precisely the kind of pressure that you would want to have
    on a dominant player to make sure that they act in a
    competitive fashion. The loss of that is the loss of
    competition.
        Senator Klobuchar. Exactly. Mr. Berchtold, we have heard
    serious concerns from artists, promoters, venues that Live
    Nation's dominance in the concert tour promotion can pressure
    venues to use Ticketmaster's primary ticketing service
    exclusively. How else would you explain the fact that
    Ticketmaster has 80 percent of major venues contracts in the
    U.S.?
        Mr. Berchtold. It is absolutely our policy to not pressure,
    threaten, or retaliate against venues by using content as part
    of the ticketing discussion.
        Senator Klobuchar. Mr. Mickelson, have you seen Live Nation
    leveraging its power as the leading concert promoter to
    pressure venues to use Ticketmaster for primary ticketing? How
    are they able to do that?
        Mr. Mickelson. When speaking with people that either own or
    manage venues, their biggest fear is if they leave
    Ticketmaster, they will lose content. So whether it is said or
    not, it is implied that if I do not use Ticketmaster, I am not
    going to get all the shows that I would like to have.
        Senator Klobuchar. I get it.
        Mr. Mickelson. And by the way, if you look at the
    difference between the Target Center in Minneapolis and the
    Xcel Energy Center in St. Paul, the Target Center is ticketed
    by AXS. The Xcel Energy Center is ticketed by Ticketmaster.
    Look at the number of shows that play Xcel, and you will see
    they far exceed the number of shows that play Target. And when
    you look at and break it down a little farther, you will see
    that most of the shows that play Xcel are Live Nation shows,
    and they bring very few to the AXS-controlled venue, the Target
    Center.
        Senator Klobuchar. Okay. Thanks for that local reference.
        Mr. Berchtold, one way that Live Nation eliminates
    competitive pressure is by locking venues into multiyear
    contracts, whether they are 3 years, 5 years, 7 years. If you
    have tied up 80 percent of major concert venues with multiyear
    contracts, where is there room for one of your competitors to
    get in the door?
        Mr. Berchtold. Yes, Senator. First, I would note that the
    80 percent reference, I believe, is from a 2008 Department of
    Justice study, and we believe that our market share is
    substantially lower than that. I will----
        Senator Klobuchar. How much lower?
        Mr. Berchtold. We would--a variety of ways of estimating
    the market share in the industry. Depending on what you
    include, we believe our market share would be somewhere between
    the 50 and 60 percent range.
        Senator Klobuchar. Keep going.
        Mr. Berchtold. Yes, I will absolutely acknowledge that it
    is the standard practice of venues in the United States who own
    ticketing rights to maximize the value of the ticketing rights
    they own by having long-term exclusive agreements with primary
    ticketing companies. Those ticketing contracts tend to last 3
    to 5 years on average.
        I would note a very specific indication of the high level
    of competitiveness is, first, that with almost every contract
    renewal we have over the past decade, more of the money gets
    accrued to the venues as opposed to the primary ticketing
    provider, which would be one indicator of a very competitive
    marketplace.
        Second, I would note the success that SeatGeek had between
    2018 and 2022. Adding roughly 15 percent of the NFL and the NBA
    teams as primary ticketing clients showed the level of movement
    of these clients.
        Senator Klobuchar. Okay. Ms. Bradish, do these type of
    exclusive contracts, do they shut out competitors? To me, like
    if you cannot go to anyone else, what are you going to do?
        Ms. Bradish. Exactly. And I think it is a standard given in
    antitrust law that the longer the exclusivity in a contract,
    the greater the risk of a competitive effect. And the fact that
    they are able to get this length of contract indicates
    something about their market power.
        So, of course, it makes it much harder for a--particularly
    a newer entrant to get into the market if everybody is already
    tied up.
        Senator Klobuchar. And Mr. Groetzinger, do you think that,
    to go to another topic, that Live Nation's concert promotion
    business, the fact that they are combined, has made it harder
    for you to compete for primary ticketing with Ticketmaster?
        Mr. Groetzinger. Yes, absolutely it has. Typically, we will
    go to a prospective client. We will show them our technology.
    They will get excited. They will get excited about how it is
    going to make the experience better for their fans and allow
    them to run their business better. And then they will start to
    think about the concert threat, and they will talk, and
    discussions will often close at that point because they have
    heard or have been explicitly threatened in a way that they
    know they will lose concerts if they move away from
    Ticketmaster.
        And one other thing I would note that I think particularly
    is scary on that last topic is in response to some of the
    oversight and poking that has happened recently, we have seen
    Ticketmaster moving from 5 years, which used to be the standard
    length for a contract in our industry, to 10 in many cases.
    They are trying to lock things down so that if there is more
    pressure, they have at least signed a lot of these decade-long
    deals.
        So there is not a lot of time. If we want competition in
    this industry, it is already going to be very hard to change.
    Longer contracts make that even harder, and that is what they
    have been pushing for recently.
        Senator Klobuchar. Exactly. Last, Mr. Lawrence, what was
    the amount you said the percentage of your tickets, some of the
    highest ones you have had recently that were fees?
        Mr. Lawrence. Typically with Ticketmaster, we will see a 40
    percent-ish or closer to 50 percent fee added on top. We have
    seen really outlandish numbers like we had a show last spring
    where there was an 82 percent fee on top of the base price. And
    again, we have no say--or we do not even know what it is going
    to be until it goes on sale.
        Senator Klobuchar. Mr. Berchtold, you heard Mr. Lawrence.
    With Ticketmaster's market power, which we all know exists--we
    would be kidding ourselves if we said it did not exist--why
    have you not done more to reduce fees?
        Mr. Berchtold. As I noted in my comments, Senator, the fees
    are set by the venues. The Live Nation venues have fees that
    are consistent with the other venues in the marketplace and
    cover the costs of the operation of those venues.
        Senator Klobuchar. Mr. Lawrence wants to reply.
        Mr. Lawrence. We definitely ask venues before almost every
    show what is the ticket fee going to be, both venues that Live
    Nation owns and ones that they just operate, and they always
    certainly do not take responsibility for the fees. So I am
    not--I do not know who is doing the fees, but we ask that
    question to the venues, and they say not only do we not choose
    what it is, we do not even know what it is. We cannot even tell
    you what it is going to be. So I do not know where the answer
    lies, but no one is taking responsibility.
        Senator Klobuchar. Okay. Last word, Ms. Bradish.
    Transparency would be helpful to know what the fees are. Is
    that right?
        Ms. Bradish. Yes, absolutely. The market cannot work well
    without transparency.
        Senator Klobuchar. Okay. Clearly, there is not transparency
    when no one knows who sets the fees.
        Okay. With that, Senator Cornyn.
        Senator Cornyn. Thank you very much.
        Appreciate all the witnesses being here, and this obviously
    is a concerning status quo. I just want to reflect a couple
    years back during the height of the pandemic, we wondered
    whether any of these venues would--many of these venues would
    survive, including in my State in Texas. And it is great to see
    that the work that Congress did with Save Our Stages and other
    support that Senator Klobuchar and I led had a positive impact
    on preserving many of these especially smaller venues and
    making it possible for many of the small businesses, which, Mr.
    Lawrence, I guess you would qualify as a small business, can
    continue to provide entertainment in these venues.
        I think what we have heard today does cry out for some
    response by Congress, but candidly, I am not sure that the
    antitrust laws are the best tool in our toolbox. But that is
    something that we will be talking more about in the near
    future.
        Mr. Berchtold, I am intrigued by a couple of your
    statements. You said that you have an ``artist first'' business
    model, and then you later said you would never put your
    interests ahead of theirs. Is that your testimony?
        Mr. Berchtold. Yes, Senator, that is the approach of our
    business. Culturally, we believe that it is all about getting
    that artist on stage, letting them connect with their fans. And
    we believe if we support that and consistently act that way,
    then we will have a long and successful business working with
    artists and providing them services.
        Senator Cornyn. I guess without the artists, you would not
    have a business?
        Mr. Berchtold. That is correct, sir.
        Senator Cornyn. Mr. Lawrence, has that been your
    experience, that Live Nation never puts their interests ahead
    of the artist and that they have an ``artist first'' business
    model?
        Mr. Lawrence. I think, generally, when we show up to play a
    show, the people that work for Live Nation at the venue
    absolutely, you know, try to be partners to us in putting on
    the best concert. I think that the places where sometimes maybe
    you could feel like it is not ``artist first'' is just in the
    structure of the way--some of the deals with the artists.
        When you look at the settlement sheet at the end of the
    night, where--which breaks down who gets paid what, some of
    those line-items where we have no say in setting any of the
    prices of those things, yet some of them are Live Nation
    directly setting the price for things that they are paying to
    other entities that they might own, which directly impacts the
    profit pool from which the artist pay is being derived. Those
    are the moments where I would not say it is not ``artist
    first''--I mean, who is to say--but like those are the moments
    where it feels like we are not truly aligned in our incentives.
        Senator Cornyn. Well, for your band to make 6 bucks out of
    a $42 ticket price----
        Mr. Lawrence. Yes, that does not feel great.
        Senator Cornyn [continuing]. Does not strike me as ``artist
    first.''
        Mr. Lawrence. I would agree with that.
        Senator Cornyn. Mr. Berchtold, you talked about how many--
    how few venues that Live Nation actually owns, but the truth is
    that you have these--I think you alluded to this, sir--you have
    these long-term exclusive rights contracts with many venues
    that you do not actually own or that you have some sort of
    partial ownership where you have effective at least contractual
    control over those venues. Is that correct?
        Mr. Berchtold. Senator, if I could differentiate on the
    ticketing side and the ticketing contracts, as opposed to on
    the promotion side. So on the promotion side of the business,
    which Senator Klobuchar was asking about, there are roughly
    4,000 venues in the United States. Roughly 200 of them we
    operate, often do not own the underlying business, but operate
    the buildings. And then we have roughly 40 more buildings with
    which we have an exclusive promoter relationship.
        So it is a very--that is a very small portion of the market
    for venues.
        Senator Cornyn. Whether or not you actually own the venue,
    you do have effective influence and maybe in some cases
    outright control over what the venue charges in terms of the
    ticket price. Correct?
        Mr. Berchtold. In roughly 240 buildings, or 5 or 6 percent
    of the market, sir, yes.
        Senator Cornyn. Mr. Mickelson, why is it so hard for the
    average consumer to get access to tickets, and who benefits
    from less consumer access? It's not the artist, I assume?
        Mr. Mickelson. That is a good question, Senator. Let us
    take the Taylor Swift fiasco as an example.
        The fans had to sign up through Verified Fan to be able to
    even buy a ticket. Ticketmaster knew that the demand was
    enormous, bigger, larger than most any other show. And when
    they set the tickets up for sale, there are two ways you can do
    that. You can set the tickets so that they are best available,
    which means that you will sell more tickets because the fans do
    not have a choice, or you can do pick-a-seat, where it slows
    the process down.
        The process, when it is slowed down, increases the money
    that Ticketmaster makes because they make money on fees. And as
    ticket prices go up due to dynamically priced tickets,
    Ticketmaster makes more to that. So it is to their advantage to
    slow the process down and to do pick-a-seat so that it created
    the frenzy that drove the prices up, which again they are
    getting--Ticketmaster is getting a percentage of that fee. And
    the higher the ticket price, the higher the fee. So I think
    that it was driven by the corporate bottom line in the Taylor
    Swift fiasco, Ticketmaster's bottom line.
        Senator Cornyn. I see my time is up. Thank you.
        Senator Klobuchar. Thank you very much, Senator Cornyn.
        Senator Whitehouse.
        Senator Whitehouse. Thanks, Senator Klobuchar.
        Let me start off by offering a Rhode Island welcome to Mr.
    Lawrence.
        Mr. Lawrence. You have seven out of the eight members of
    our band went to Brown University. So we have a lot of Rhode
    Island pride.
        Senator Whitehouse. That is pretty impressive. What were
    your favorite venues?
        Mr. Lawrence. We played at a local venue called AS220 a
    bunch.
        Senator Whitehouse. Oh, yes.
        Mr. Lawrence. But honestly, we mostly played at like house
    parties on campus. That was kind of where we got our start. We
    also played recently a bunch at Fete Music Hall.
        Senator Whitehouse. Well, AS220 is a great organization,
    and I am proud to have you in the middle of this. This is a
    group that emerged from our terrific Brown University.
        Mr. Lawrence. Thank you.
        Senator Whitehouse. You mentioned in your testimony today
    that when artists like you play a Live Nation venue, you
    typically are also required to use Ticketmaster and a Live
    Nation-owned promoter. If that were not the expectation, what
    would the difference, do you think, be for your band and your
    fans?
        Mr. Lawrence. Well, if we had the ability to weigh
    different offers, then we would just be able to see a more
    apples-to-apples comparison of what kind of deals we could get
    in a given venue. But you are correct in saying that, yes, when
    we pick a given venue, if it is a venue that Live Nation is
    either the exclusive promoter or the operator or the owner of,
    there is no opportunity but to just receive a deal that we have
    no ability to negotiate from Live Nation.
        And yes, the tickets have to be ticketed by Ticketmaster.
    There is a--you know, it would be great to be able to find out,
    oh, if it was this ticketing company, it might be a different
    fee, or I know Mr. Berchtold is saying that the venue sets the
    fee, which has not been our experience. But you know, ideally,
    we would be able to see, oh, if it was this company, it would
    be this, or whatever.
        Senator Whitehouse. Could you say a little bit more about
    how that has not been your experience?
        Mr. Lawrence. It has 100 percent not been our experience.
    Yes. There has literally not been a single time in our career
    when we have played at a Live Nation venue where we had any
    opportunity to not have Live Nation be the promoter or not have
    Ticketmaster be the ticketing company.
        Senator Whitehouse. Have you heard of any other artists who
    have been able to figure out a way around that, or do you think
    that all artists are up against the same wall that you have
    described of inevitability?
        Mr. Lawrence. Yes. As far as I am aware, no one has had a
    different experience than me. I know at the highest levels of
    playing like stadiums or arenas, there might be an opportunity
    to have a certain promoter come in and do that arena, but I do
    not--that is not my area. In terms of----
        Senator Whitehouse. In time, Mr. Lawrence. In time.
        Mr. Lawrence. Yes, hopefully. Hopefully.
        [Laughter.]
        Senator Whitehouse. Well, thanks very much. I appreciate
    you being here.
        And thank you, I guess it is Acting Chair Klobuchar, for
    the hearing.
        Senator Klobuchar. All right. Thank you very much, Senator
    Whitehouse.
        And I noticed, Mr. Nuzzo, that Mr. Lawrence has been
    getting a lot of the questions, and I know your daughters are
    watching. So Senator Lee and I promise we will ask you a
    question on a second round if no one else does. That is a
    little cue for you guys.
        Next up, we have Senator Blackburn.
        Senator Blackburn. Thank you, Madam Chairman. And thank you
    to you all for being here.
        In Tennessee, this has been an issue where there has been a
    lot of conversation about it. And Mr. Berchtold, thank you for
    your time yesterday to talk about this. As I told you, we have
    got a lot of people that are very unhappy with the way some of
    this has been approached. And there is frustration. We talked
    yesterday about the bots and how they impact Ticketmaster's
    operations and that you have blamed bot attacks on causing the
    crash during the Taylor Swift ticket sales, and ticket vendors
    seem to view bot attacks as normal to their operations.
        And Chair Durbin had mentioned and, of course, we all know
    the BOTS Act is something when I was in the House that got
    passed, signed into law. Senator Schumer had carried that over
    in the Senate. The FTC has only enforced this once, and they
    have had the authority to do this since 2016.
        So this is an unacceptable situation. Senator Blumenthal
    and I are going to do some more work on this at Commerce, at
    the Commerce Committee, at the Consumer Protection
    Subcommittee.
        But I do have a couple of questions. I have got about four
    questions, Mr. Berchtold, and I want to move quickly through
    this. So do not try to just run the clock out on me, which I do
    not appreciate that.
        So the data that you collect. Now there is a 2019 report
    that showed that Ticketmaster's app has more downloads and more
    active users than any of its competitors. And I bet if I went
    down, everybody would shake their head yes that that is
    correct. And you have the most monthly active user growth that
    anyone is seeing. So--and I want you to submit the answers to
    this to me in writing.
        But let us take the Orange Bowl app, which I downloaded
    last month taking my grandsons to the Orange Bowl. Go Vols! A
    big win there. That app is powered by Ticketmaster.
        Now when you use that app, you can purchase parking,
    official merchandise, access travel sites. So you are getting a
    lot of consumer data and consumer information. So I want to
    know what are you doing with that data?
        Now you told me yesterday you block about 90 percent of the
    bot attacks that you get, but that is a failing grade, and we
    know that because--and there ought to be people you can get
    some good advice from. Because our critical infrastructure in
    this country, whether it is utilities--electric, water, power--
    banking services, credit card processors, payment processors,
    healthcare companies, you know what, they get bot attacks every
    single day by the thousands. By the thousands. And they have
    figured it out, but you guys have not? This is unbelievable.
        You ought to be able to get some good advice from some
    people and figure this out. So what are you doing with the
    information as you get this bot attack? Are they coming in here
    and scooping up consumer information?
        When consumers buy tickets from StubHub and they are
    required to return to Ticketmaster to have their order
    fulfilled, are you getting their data? And what are you doing
    with it? Are you then sharing it with these other vendors? What
    kind of protections are around it? How are you safeguarding
    this?
        So I would like a response to that in writing from you
    because that is going to determine how we move forward. The FTC
    has the responsibility. They have the authority, but you, sir,
    are responsible to the consumers. You are controlling 70
    percent, 80 percent of the ability of consumers to access
    tickets to sporting events, to concerts.
        And when I run into an entertainer--and Mr. Lawrence, you
    need to come to Nashville. We are going to have to----
        Mr. Lawrence. We have been there. We just played a couple
    months ago.
        Senator Blackburn. Come on back. Make it your home.
        Mr. Lawrence. Sure thing.
        Senator Blackburn. People love Tennessee. But you know, we
    need to have an answer to this. Yes, the FTC has the authority.
    Yes, the legislation was signed into law. I agree that they are
    not exercising it, but how many times have you called the FTC
    and said we need your help?
        Mr. Berchtold. Yes, Senator. We will submit in writing the
    answers to your questions that you requested.
        Senator Blackburn. How many times have you called the FTC
    and say, help me with this?
        Mr. Berchtold. We worked with the FTC on an investigation I
    believe it was late 2019 or 2020. We obviously post--during
    COVID shut down.
        Senator Blackburn. So you called them once? You called them
    once and said help me out?
        Mr. Berchtold. That was the time that we were able to have
    the information, work with them to get prosecution.
        Senator Blackburn. Why is it that you cannot identify a bot
    attack? You told me yesterday you have a hard time
    distinguishing between a bot attack and a consumer. But the
    local power company down here that is not the billion-dollar
    company you are, they can tell when they have got a bad actor
    in their system. They have figured out how to define a bot in
    their system, but you cannot?
        Mr. Berchtold. Yes, Senator----
        Senator Blackburn. Do we need to make certain you have
    better people around your IT team?
        Mr. Berchtold. Yes, Senator. It is absolutely an ever-going
    arms race in terms of fighting the bots. These are bots that
    are not trying to generally break into our system. They are
    bots that are trying to impersonate people to get tickets on an
    automated basis faster and putting true fans at a disadvantage.
        Senator Blackburn. It is American consumers, true fans.
    Yes, American consumers.
        Madam Chairman, I have one other question if we do a second
    round.
        Senator Klobuchar. Okay. That will be good. We will do a
    second round because we also want to get to solutions here, and
    I appreciate your questions, Senator Blackburn.
        Next up, Senator Blumenthal.
        Senator Blumenthal. Thanks so much, Chairman Klobuchar, and
    thank you for your great work on this issue and so many others
    involving antitrust. And my thanks as well to Senator Lee.
        Thank you to everyone for being here today.
        Mr. Berchtold, I want to congratulate and thank you for an
    absolutely stunning achievement. You have brought together
    Republicans and Democrats in an absolutely unified cause, and
    may I suggest respectfully that, unfortunately, your approach
    today in this hearing is going to solidify that cooperation
    because as I hear and read what you have to say, it is
    basically ``It is not us. It is everyone, but us.''
        And the fact of the matter is that Live Nation-Ticketmaster
    is the 800-pound gorilla here. You have clear dominance,
    monopolistic control. This whole concert ticket system is a
    mess. It is a monopolistic mess, and the numbers refute many of
    your arguments. That is the reason we have had two--count them,
    two--consent decrees and why the Justice Department is now
    investigating violations of that second consent decree.
        Ticketmaster had the temerity to imply that the debacle
    involved in pre-ticket sales was Taylor Swift's fault because
    she was failing to do too many concerts. And may I suggest
    respectfully that Ticketmaster ought to look in the mirror and
    say, ``I'm the problem. It's me.''
        And the reason is quite simply that you are the ones
    ultimately responsible for the astronomically rising prices,
    the exorbitant hidden fees, the sold-out shows, the bots, and
    scalpers. We just had an exchange with Senator Blackburn. You
    have reported once, over this entire history once, an incident
    involving bots.
        I agree with Senator Blackburn that there needs to be
    stronger enforcement by the FTC. It has taken almost no action
    against the bots, despite our support for the BOTS Act, and
    that is the reason why I am supporting legislation talking
    about remedies, legislation called the BOSS Act, which would
    require transparency, accountability for hidden fees, for bots.
    Will you support the BOSS Act?
        Mr. Berchtold. Yes, Senator. We absolutely agree that----
        I am sorry. Senator, we absolutely agree there are a lot of
    problems in this industry, and as the leading player, we have
    an obligation to do better. If I----
        Senator Blumenthal. Will you support the BOSS Act?
        Mr. Berchtold. I do not know all of the specific elements.
    I know there are many elements that we agree upon. I believe
    there are some issues that we have some differing views, and we
    have offered to discuss those. We would like to continue to
    discuss those going forward.
        Senator Blumenthal. Will you support legislation to require
    complete transparency all-in to provide stronger enforcement
    powers against bots and scalpers?
        Mr. Berchtold. We absolutely support all-in pricing. We
    absolutely support greater enforcement, greater penalties, and
    expansion of the prohibition on bots.
        Senator Blumenthal. You know, the FTC has failed in some of
    its enforcement duties, but that is because Live Nation-
    Ticketmaster has failed to do the reporting that is required to
    enable enforcement, and I think that really betrays the
    contention that you have been active against it. And I think
    that consumers and artists and venues are all fed up with the
    system that exists right now.
        And I think to the people who are fed up, I would say
    continue your criticism if you are angry and frustrated. You
    have the power to demand action, and we should act with new
    legislation.
        If the Department of Justice establishes violation of the
    consent decree, unwinding the merger ought to be on the table.
    If the Department of Justice establishes facts that involve
    monopolistic and predatory abuses, there ought to be structural
    remedies, such as breaking up the company. We will see what the
    Department of Justice finds.
        And to the FTC, we owe the duty of providing resources that
    are needed for more effective enforcement and the incentive and
    the kind of encouragement and support for action in this area.
        Let me ask you, will you support other kinds of legislation
    that would enable more transparency in this area?
        Mr. Berchtold. As a general concept, absolutely. We support
    more transparency. And I also commit that if you pass harder
    laws on bots with greater enforcement that I will commit that
    we will do our part to support them.
        Senator Blumenthal. And will you take action against the
    bots?
        Mr. Berchtold. If we get the laws that are going to be
    enforced and supported and have real teeth and penalties
    against people, we will do our best----
        Senator Blumenthal. Well, you have the power right now to
    take action. Why have you not done it?
        Mr. Berchtold. We have a limited level of power on
    something that has not been consistently enforced.
        Senator Blumenthal. You have unlimited power to go to
    court. Under the current BOTS Act, which we have supported, we
    have given you the right of action. You are the only ones who
    have the resources and the knowledge to take effective action
    right now. Why have you not done it?
        Mr. Berchtold. Well, we would love the support of further
    laws, of working with the FTC, getting other information on the
    actual sale of the bot-generated tickets on the various
    secondary platforms.
        Senator Blumenthal. Now if you are concerned about artists,
    consumers, venues, and about the public interest, you would
    take action under current law. You have the right of action.
    You have the resources, and you have the kinds of legal
    authority to do it. And so that is why I come back to where I
    began. Your approach seems to be it is everyone else who is
    responsible here, not us, and I hope that that approach will
    change in the future.
        Thank you, Madam Chair.
        Senator Klobuchar. Thank you. Thank you, Senator
    Blumenthal.
        Next up, we have Senator Kennedy and then Senator Hirono.
        Senator Kennedy. Mr. Berchtold, am I saying that right?
        Mr. Berchtold. Yes, Senator, thank you.
        Senator Kennedy. Mr. Berchtold, I am not against big, per
    se. I am against dumb. And the way your company handled the
    ticket sales for Ms. Swift was a debacle, and whoever in your
    company was in charge of that ought to be fired.
        Number two, I hear two things today. I hear some of you
    saying that we have an antitrust situation here, and that is
    wrong from an academic perspective and a consumer protection
    perspective. I hear others of you saying Live Nation is making
    too much money, and we want some of it. Okay? But I hear all of
    you saying you care about the consumer, and I take you at your
    word.
        So how would you feel about adopting a rule which it seems
    to me would satisfy the bot situation. Let us just adopt a
    rule--well, strike that. I do not want to make it a suggestion
    because I want to think it through more. But let me ask you
    your opinion. You are the experts.
        What if we adopt a rule that said tickets to a Taylor Swift
    concert or Mr. Lawrence's band's concert are nontransferable?
    Now you are not going to have a problem with bots, okay? If you
    have got a scalper trying to buy 2,000 tickets, they do not
    want 2,000 tickets. They want a profit. And it will hold down
    ticket prices. Why do we not do that?
        Don't everybody jump in at once.
        Mr. Lawrence. I mean, I think whether it was that or only
    transferable at face value. I am not an expert on the secondary
    ticketing market, so all I can tell you is that from the
    artist's perspective, we would not make a dollar less if that
    were implemented.
        Senator Kennedy. Yes, but Mr. Lawrence, if you care about
    the consumer--and I hear you say that you do--I will tell you
    what the consumer is concerned about. The consumer is not
    concerned about how many lawyers can dance on the head of a pin
    and whether this is an antitrust violation or not of the FTC.
    The consumer is concerned about the price.
        Mr. Lawrence. Yes. So I am saying I think----
        Senator Kennedy. So would you support nontransferability or
    you can only transfer it at face value?
        Mr. Lawrence. I mean, I think it is a really interesting
    question. I am not an expert on it.
        Senator Kennedy. How about you, Ms. Bradish?
        Ms. Bradish. Well, I think nontransferability is making a
    judgment in lieu of what a customer would make.
        Senator Kennedy. I understand what it means. Would you
    support that?
        Ms. Bradish. No.
        Senator Kennedy. Okay. How about you, Mr. Nuzzo?
        Mr. Nuzzo. I would respectfully not support such a rule.
        Senator Kennedy. Okay. How about you, Mr. Mickelson?
        Mr. Mickelson. Mickelson, but that is good.
        Yes, Senator, a good question. Totally support
    nontransferability, totally.
        Senator Kennedy. Okay, thank you. Next, sir?
        Mr. Groetzinger. I respectfully think transferability is
    important for consumers.
        Senator Kennedy. You think it is important? Is it important
    for consumers or for the middleman?
        Mr. Groetzinger. Like let us say I am going to a show with
    Jerry, and I buy the tickets. I want to be able to send that
    ticket to Jerry so that we can go together.
        Senator Kennedy. That is the exception rather than the
    rule.
        Mr. Groetzinger. Yes, I mean, certainly I think there is
    interesting ways we could use----
        Senator Kennedy. A few people may have to eat the ticket.
    They get sick. They cannot go. But most people will think about
    that before they buy the ticket.
        Now if you want to hold down prices, cut out the middlemen
    and the middlewomen, you want to cut out bots, make it
    nontransferable or transferable only at price, at face value.
    Couldn't a major artist, couldn't a Bruce Springsteen say--
    whose music I love--couldn't he say, Look, I have got market
    power. I am going to set this price for the ticket, I am going
    to set this price for the service fee, and it is going to be
    nontransferable.
        Couldn't an artist do that with market power?
        Mr. Groetzinger. Yes, for sure. Yes, I think it is an
    interesting idea, and some artists----
        Senator Kennedy. Problem solved.
        Mr. Groetzinger. Some artists have done that----
        Senator Kennedy. Problem solved.
        Mr. Groetzinger. For sure.
        Senator Kennedy. How about that, Mr. Berchtold?
        Mr. Berchtold. Yes, Senator. We would fully support an
    artist's right to make their shows nontransferable.
        Senator Kennedy. I did not ask that. Do you support--do you
    support nontransferability or not?
        Mr. Berchtold. We would support nontransferability, yes.
        Senator Kennedy. Well, then why--a big part of the problem
    is just solved. Okay? If you care about the consumer, you are
    going to hold the price down. You are going to cut out the
    middleman.
        Now we still have the problem of some of your colleagues
    say you are making too much money. Some of them say, I hear
    them say you are making too much money, and we want some of it.
    I hear others saying you are making too much money, and that is
    hurting the consumer because those fees get passed on.
        If you care about the consumer, cap the price. Cut out the
    bots. Cut out the middle people. And give--if you really care
    about the consumer, give the consumer a break. Not every kid
    can afford whatever it is, $500, to go see Taylor Swift.
        And I would like to see Ms. Swift or Mr. Springsteen or
    some of the other major artists step up and say you know what,
    we are going to support nontransferability, and we are going to
    cap the fees that are added on here, and we are going to make
    sure that the artist is paid a fair price. Everybody else can
    make a profit, but you cannot make an obscene profit,
    especially the scalpers.
        If we do that, now we've done something. Now we've gone
    beyond how many lawyers can dance on the head of a pin and
    whether the FTC ought to be involved. And we know fully well
    that'll happen sometime in the next century. And whether
    something is a technical violation of the antitrust law, which
    we have to go litigate.
        Senator Klobuchar. Okay.
        Senator Kennedy. My work here is done.
        Senator Klobuchar. Senator Hirono. Thank you, Senator
    Kennedy.
        Senator Hirono. Thank you, Madam Chair.
        I think that, Mr. Nuzzo and Ms. Bradish, you just responded
    that you would not support nontransferability. Very briefly,
    could you explain why not?
        Ms. Bradish. Well, I think it goes to a regulatory solution
    to something that should be a competition issue. If there were
    competition, if we solve the competition issue here, then
    customers will get what they want. So I think this is--it does
    not get to the heart of the matter, essentially.
        Senator Hirono. Mr. Nuzzo?
        Mr. Nuzzo. Yes, thank you very much, Senator.
        It is a good question, and ultimately, we would look at it
    in a couple of ways. One is a property rights issue. As an
    individual purchasing a ticket, I should have the ability to
    transfer that ticket at a market rate.
        Second, I would point to a statistic--I believe it was from
    a GAO report--that close to, if not a majority of the tickets
    on the resale market are going for under the market value. So
    while I would contend that I am not going to pay $500, let
    alone $5,000, to go see Taylor Swift, the secondary market
    allows artists like the band Lawrence, who are selling to
    smaller venues and are growing, the ability to fill those
    venues, especially when those cases come where an individual is
    unable to use their ticket.
        Senator Hirono. So isn't Ticketmaster also in the secondary
    market?
        Mr. Nuzzo. I believe the largest secondary market is
    StubHub, but I do believe Ticketmaster is either building or
    growing a secondary resale market.
        Senator Hirono. Yes. So I am surprised that Mr. Berchtold
    says that he would definitely support nontransferability.
    Nothing is simple.
        Mr. Lawrence, as you sit here, can you tell me what you
    hope will happen after this hearing?
        Mr. Lawrence. Yes, it is a great question. I think that we
    have a few specific things that we would just love to see
    change in the industry how ever--how ever we are able to get
    there. To list a few, I think that dealing with this whole
    inconsistency around ancillary revenues, which is something
    that we are not talking about as much today, the idea that Live
    Nation or, frankly, most promoters typically take 20 percent or
    more of our gross merchandise sales from the night under the
    idea that they are providing the real estate, but we are
    providing all the customers.
        As Mr. Nuzzo was talking about, you say you are going to
    see a Harry Styles show. You are not going to XYZ arena. So how
    come we do not get any of their bar sales? That is one example.
    I could keep listing more.
        Expansion of off-platform ticketing or ticketing choice.
    Caps on fees like we are talking about. Greater transparency on
    the settlement sheets that we receive at the end of the night.
    That is a whole other conversation that I could list 10 things
    about the way those are formatted and broken out in a way that
    feels not totally ideal or fair to artists.
        I could go on and on.
        Senator Hirono. So there are a number of things that we can
    do, do these kinds of things for you to be able to probably
    negotiate better.
        Now, Ms. Bradish, do we have to change any laws in order to
    enable an artist like Mr. Lawrence to do what he wants to be
    able to do?
        Ms. Bradish. Well, I think we need to support strong
    antitrust enforcement. We have to give the agencies the
    resources and the legislation, the clarity of legislation that
    will enable them to attack practices like this. So, yes, we
    need to support and give resources to the existing antitrust
    agencies and the existing laws, and we should consider other
    laws, like Senator Klobuchar's law, that would clarify and
    strengthen those antitrust laws.
        Senator Hirono. Also the BOSS Act, which I--Senator
    Blumenthal's bill, which I signed on to, which creates greater
    transparency.
        You testified, Ms. Bradish, that there should be a
    presumption for vertical mergers as we do for horizontal
    mergers. What would that presumption be for vertical mergers?
        Ms. Bradish. Well, for vertical mergers, we can look at--we
    can obviously look at the share in a particular market. We can
    look at their ability, the ability of the monopolist to
    exercise power in another market downstream or upstream. There
    are a number of ways to get at the same problem, but the idea
    is that you give the DOJ or FTC a foothold in order to be able
    to bring the case before a court, a foothold to be able to say
    this is illegal, presumptively illegal.
        Senator Hirono. Do we need to amend the Sherman Act to
    create such a presumption for vertical mergers, or do we need
    to strengthen the Clayton Act, Section 7?
        Ms. Bradish. Well, I think that the current Clayton Act and
    Sherman Act do not have the presumptions for horizontal
    mergers. Those come from the case law. So we do not necessarily
    need to change the fundamental contours of the Clayton Act and
    the Sherman Act. In fact, I would suggest that the Clayton Act
    already has built this in.
        Senator Hirono. The Live Nation-Ticketmaster merger has
    already occurred. I am interested in what we can do to prevent
    this kind of market share capture in other vertical mergers.
        And I just want to mention that we have been talking a lot
    about the debacle, I would say, of the Taylor Swift situation,
    and back in 2018, thousands of people in Hawaii tried and
    failed to get Bruno Mars tickets, and similar kinds of
    occurrences happened in Hawaii. And I heard Mr. Berchtold say
    that after the merger they spent $1 billion to improve the
    Ticketmaster system so that what you had in 2018, quite a few
    years after the merger, you had the similar kind of situation
    with Bruno Mars, and then you have Taylor Swift. So I am just
    wondering what kind of improvements to the Ticketmaster system
    that is actually being followed.
        Thank you very much.
        Senator Klobuchar. Thank you very much, Senator Hirono, for
    using that example.
        Next up, we have Senator Hawley.
        Senator Hawley. Thank you, Madam Chair. Thanks to the
    witnesses for being here.
        Mr. Berchtold, if I could just start with you? Your company
    is currently under a consent decree with the Justice
    Department. Is that correct?
        Mr. Berchtold. Yes, Senator, we are.
        Senator Hawley. Running through 2025. Is that right?
        Mr. Berchtold. Yes, Senator.
        Senator Hawley. This is because the Justice Department says
    that your company repeatedly conditioned and threatened to
    condition Live Nation's provision of live concerts on a venue's
    purchase of Ticketmaster's ticketing services. Is that correct?
        Mr. Berchtold. The Department of Justice alleged there were
    six instances in 2019 that they thought were violations. We
    agreed to extend the decree rather than to debate it in court
    because we had no interest in being perceived as defending the
    notion of threatening or retaliating.
        Senator Hawley. Yes. Well, kind of extraordinary to have a
    consent decree running for such a long period of time and have
    you not even fight it in court.
        Let us talk about what your company is doing to try to
    control the resale market. You have been pushing something
    called SafeTix, which, as I understand, it is a digital
    ticketing system. You need your phone for it, right? There is
    an app. It generates a bar code that then regenerates every few
    seconds. You cannot print it off. You have got to use the app
    for it.
        Is that basically correct? Do I have the basics right
    there?
        Mr. Berchtold. Yes, Senator. One of the major investments
    we have made over the past decade has been shifting ticketing
    from a paper ticket or PDF to a on-the-phone digital ticket as
    a major issue toward security and to eliminate fraud. These----
        Senator Hawley. Yes, I want to come back to that, but just
    so I understand the way the system works. So once you have got
    the app, somebody has got a ticket on the app can digitally
    transfer that ticket to another app user, but they cannot print
    it off and resell the ticket on StubHub, for instance. Is that
    correct?
        Mr. Berchtold. Yes, Senator. They cannot print it off
    because the notion of printing it would open susceptibility to
    fraud and duplication of that ticket.
        Senator Hawley. So you could only--let me just be clear
    about the way this works. You could only resell it through the
    Ticketmaster ecosystem. Is that right?
        Mr. Berchtold. No, Senator. Those tickets are often resold
    on StubHub, SeatGeek, and other secondary ticketing platforms.
        Senator Hawley. Okay. So let me just ask you about the
    counterfeiting question here. I mean, what kind of scale are we
    talking about here? I mean, how many percentage--what
    percentage of tickets sold on the secondary market do you think
    are counterfeit?
        Mr. Berchtold. Well, I think given today's digital ticket,
    the counterfeit ticket has been all but eliminated. We still
    have a large issue with speculative tickets being sold, where
    the seller does not actually own the right to the ticket but is
    selling it to the fan, who is unaware of that. But the old
    issue of having a PDF photocopied multiple times and resold has
    been eliminated.
        Senator Hawley. How does the resale of the SafeTix, how
    does the resale with another entity, let us say StubHub just
    for illustrative purposes, how does that work? How can I--if I
    had a SafeTix ticket, how could I resell it on StubHub?
        Mr. Berchtold. You could list your ticket on StubHub. There
    would be a buyer. The buyer would buy the ticket. You would
    transfer that ticket to the recipient's Ticketmaster account if
    it were a concert. If it were an NFL ticket, to their StubHub
    account.
        Senator Hawley. Do you have any plans to restrict the
    resalability of digital tickets through third-party entities
    like StubHub or others?
        Mr. Berchtold. We have no plans to restrict that
    transferability. We do believe that the artist should have the
    right to set the rules, as we were discussing earlier, in terms
    of the nature of the transferability. We believe there should
    be no difference between the rules that we, Ticketmaster,
    follow and what any of the other platforms can do.
        Senator Hawley. So let me just ask you about the
    transferability question. Why is it good for consumers to limit
    transferability? I heard your exchange with Senator Kennedy. I
    do not understand why it is a good thing for the ticket buyer
    to not be able to resell her tickets or his tickets.
        Mr. Berchtold. Yes, Senator. I think tickets, and concerts
    in particular, are a unique animal in that those tickets are
    often underpriced by the artist because they want to deliver
    value to the fans. And that creates the opportunity, a $5
    billion a year opportunity in the United States, for the
    industrial scalping of tickets using bots to unfairly gain
    possession of those tickets, illegally gain possession of those
    tickets and resell them on the secondary.
        So the transferability comes into play as part of the
    discussion or this comes into the discussion on transferability
    given that illegal activity that is enabled by ease of
    transfer.
        Senator Hawley. But are there other examples of markets,
    ticket markets where we limit transferability in that way?
        Mr. Berchtold. Senator, I am not aware of other markets
    where you have such a substantial arbitrage in the value.
        Senator Hawley. Yes, it just--I mean, you cannot do it,
    obviously, with movie tickets, let us say. I mean, those are
    freely transferable. I just worry about the effect on consumers
    and prices. If you tell a consumer who buys her ticket that she
    cannot then turn around and sell it, I mean you talk about a
    market intervention, that is a pretty significant one.
        I understand why the artists would like it, and I certainly
    understand why you would like it. It is not clear to me why it
    is good for consumers.
        Mr. Berchtold. Yes, Senator. I think we believe it is good
    for consumers because it would mean that the consumers could
    buy all of those tickets rather than having what is often 20 to
    30 percent of concert tickets purchased by scalpers using bots
    and put on the secondary market directly.
        Senator Hawley. Let me just--Madam Chair, I know I am over
    time, and Senator Cruz wants to ask questions. Let me just
    really quickly here ask Ms. Bradish if I could. I want to come
    back to this consent decree extension that is now running out
    through 2025.
        What DOJ alleged in 2020 was pretty significant. They said
    that there had been violation of the earlier consent decree,
    that Live Nation had retaliated, that they violated the plain
    language of the decree. It is not normal, is it, for antitrust
    consent decrees to get extended like this after violations are
    identified. Am I correct?
        Ms. Bradish. That is correct.
        Senator Hawley. So what do you think is going on here?
        Ms. Bradish. Well, I think it certainly shows that the
    problem that they anticipated in 2010 is--actually has come to
    pass in 2020. It means that Ticketmaster-Live Nation is a
    monopolist whose conduct needs to be supervised.
        I do not think that this changes their incentive. So it
    makes it very difficult in the long run for DOJ to actually
    supervise it.
        Senator Hawley. You do not think it changes Live Nation's
    incentives you are saying?
        Ms. Bradish. Right. I mean, their incentives are still to
    bully others.
        Senator Hawley. Right. What should happen then, in your
    view?
        Ms. Bradish. A structural remedy. There should be a
    spinoff. There should be disintegration of the vertical
    integration.
        Senator Hawley. Very good. Thank you, Madam Chair.
        Senator Klobuchar. Very good. Thank you, Senator Hawley.
        Before Senator Cruz, Senator Tillis was here first. Thank
    you, Senator Tillis.
        Senator Tillis. Thank you, Senator Klobuchar.
        Mr. Lawrence, ``Don't Lose Sight,'' ``Do You Wanna Do
    Nothing With Me?'' and let's see, what is the other one? Oh,
    ``It's Not All About You.'' Sounds like you have been
    eavesdropping on conversations among Senators as an inspiration
    for those songs.
        [Laughter.]
        Mr. Lawrence. Thank you.
        Senator Tillis. I also just want to point to the fact we
    are looking at, I think--at the time, anyway--the youngest
    member of the Songwriters Guild after you helped your dad
    figure out how to do the Miss America pageant or revise it for
    the purposes of that movie?
        Mr. Lawrence. Something like that, yes.
        Senator Tillis. Let me ask you, first off on the issue of
    transferability, I am a Ticketmaster user. I am a season ticket
    holder for the Carolina Panthers. It seems to me that I like
    the idea of an artist being able to do that. Maybe that is what
    Taylor Swift should have done because it would have probably
    avoided the situation we had there. But I think a broad brush
    policy on nontransferability has all kinds of problems, to the
    point that Senator Hawley made, and I could think of other
    ones.
        I also think when we talk about scalpers, there are
    scalpers out there. But there are also people that are
    speculating on the market being able to demand a higher price.
    That sounds like a free market principle I do not want to get
    too far ahead of. So I think we have to be very careful when we
    talk about things like that.
        Mr. Berchtold, I am trying to--clearly, Ticketmaster and
    Live Nation are in the crosshairs. So can you give me two
    things? I was also prompted by the discussion you had with
    Senator Blumenthal. One, tell me what you are doing to address
    what you think--whether or not you believe they are valid, you
    can see forces working against you. What specifically is
    Ticketmaster and Live Nation doing to prevent Congress from
    doing something to you?
        Mr. Berchtold. Well, thank you, Senator.
        I think that, first, we are here today. We would like to
    engage in a discussion about what are the policy changes that
    can be made that can make this a better consumer experience. We
    believe all-in pricing makes a lot of sense. It simply is clear
    up front what price you are paying.
        We believe that there are absolutely deceptive practices
    that take place today in ticketing. I could give an----
        Senator Tillis. If I may?
        Mr. Berchtold. Yes.
        Senator Tillis. Because I am going to stick to time.
        Mr. Berchtold. Yes, sorry.
        Senator Tillis. I think that it would--and I am sure you
    are already thinking about it. But it is getting ahead of
    something that is probably but for good-faith efforts on you
    all's part, you may get a congressional prescription that is
    not--that is going to have some bad side effects.
        Mr. Lawrence--and this back to you also, Mr. Berchtold--is
    there a mechanism now where Mr. Lawrence knows exactly what the
    underlying transaction for a given performance or given
    production resulted in? In other words, can he get--at the end
    of the day, he charged, I think they set a price at $30 for one
    venue. Is there any sort of backend reporting to a performer
    saying this is how it all stacked up, and this is how everybody
    in the mix actually benefited from it?
        I mean, do you have that sort of transparency today?
        Mr. Lawrence. At the end of the day, we are given a
    settlement sheet, but that settlement sheet gives us the base
    price. So it would be that $30. But I would also add that I
    mentioned earlier about a thing called facility fees, where not
    only does the settlement sheet not show the extra $12 that
    might bring it to $42, it will sometimes even say like $27,
    even though the base price was $30 because the venue is also
    just sort of arbitrarily taking an additional $3.
        So the sheet we get says the tickets were sold for $27
    rather than $30 or even $42, which feels a little bizarre to
    me.
        Mr. Berchtold. Yes, I believe that the general notion of a
    settlement is correct. If Mr. Lawrence and others are not
    getting the rate cards on the service fees up front and having
    that made available to them, that is a problem on our end that
    I will look into coming out of this.
        Senator Tillis. It seems like that needs to be there on the
    front end.
        Mr. Berchtold. I agree with that, and I think that there
    should be total transparency that Mr. Lawrence has. If there is
    a facility fee, he should know what that is. I think that is
    fairly standard practice. Again, we represent a minority of
    venues, but I think that the full transparency should be
    available to Mr. Lawrence and others in his position.
        Senator Tillis. Mr. Nuzzo, in the remaining 20 seconds,
    what do you want to say?
        Mr. Nuzzo. I think transferability is extraordinarily
    important. I think to your point about there are far more
    externalities and side effects to completely excluding
    transferability, and that is something that kind of underscored
    the first part of my remarks this morning.
        Senator Tillis. I think as we go through that, I, for one,
    love hypercompetitive market forces. Where we get into the rub
    is to what extent has it gone from hypercompetitive to
    anticompetitive? And I think that this hearing and subsequent
    discussions are going to be helpful to strike the right
    balance.
        I am probably somewhere in the middle, not necessarily
    pulling for either team. But I do think that there is work that
    we need to do here. Some of it has to be self-regulation from
    the entities playing in this space.
        Thank you, Madam Chair.
        Senator Klobuchar. Thank you very much, Senator Tillis.
        Senator Cruz.
        Senator Cruz. Thank you, Madam Chair. Thank you to each of
    the witnesses for being here.
        I think this is an issue that impacts a great many
    families. Whether you go to sporting games--I go to a lot of--a
    lot of sporting activities--or whether you go to concerts or
    whether you go to plays, families enjoy going out. They enjoy
    entertainment. And going through the process of getting a
    ticket can sometimes be gratifying and a lot of times really
    frustrating.
        I start from the principle that free markets are good, that
    if you want to have goods and services delivered to consumers
    that free and competitive markets are the most effective way to
    do so at the most price-competitive levels. I also start from a
    principle that monopolies are bad. That monopolies historically
    have hurt consumers, driven up costs, reduced options, and made
    the consumer experience markedly worse.
        I also would make an observation that in the Big Tech
    sphere in particular, we have seen monopolies being willing to
    be particularly abusive. I want to start with a question for
    the witnesses, and Mr. Groetzinger, I am going to start with
    you and just ask, in your judgment, is Ticketmaster a monopoly?
        Mr. Groetzinger. Unequivocally.
        Senator Cruz. Mr. Mickelson?
        Mr. Mickelson. Yes, sir. Without a doubt.
        Senator Cruz. Mr. Nuzzo?
        Mr. Nuzzo. Yes, absolutely.
        Senator Cruz. Ms. Bradish?
        Ms. Bradish. It is certainly acting like a monopoly.
        Senator Cruz. Mr. Lawrence?
        Mr. Lawrence. I am not sure.
        Senator Cruz. Okay. So, Mr. Berchtold, do you agree with
    the other witnesses on this panel?
        Mr. Berchtold. We absolutely believe the ticketing business
    has never been more competitive. We believe that fact is
    demonstrated by every venue renewal that has multiple credible
    offers in a bidding process.
        Senator Cruz. So are they just making it up? Why does
    everyone else perceive you as a monopoly? Where is that coming
    from?
        Mr. Berchtold. I cannot speak to all of their motivations
    on their points of view, but I think that if you simply look at
    what is the market power exercised by venues, which is perhaps
    not fully understood in our business.
        Senator Cruz. How about on the ticketing side, what percent
    of the market do you all have?
        Mr. Berchtold. I would estimate, depending on how you want
    to count what is in the market, between 50 and 60 percent.
        Senator Cruz. Fifty and 60? And depending on how you count
    it, does anyone have a markedly different measure of that?
        Mr. Mickelson. Yes, sir. Yes, Senator.
        Senator Cruz. Okay.
        Mr. Mickelson. They have 87 percent of the ticketing
    contracts at the NBA and the NHL arenas. They have 93 percent
    of the ticketing contracts at the NFL stadiums. Those are the
    most important venues. You cannot include--if he is including--
    he is including--it is yes. I will stop there.
        Senator Cruz. And can I fairly blame Mr. Berchtold for the
    Texans having such a lousy season, and the Rockets having such
    a lousy season, and the Cowboys just losing? I mean, it has
    been--but the Astros did win the World Series. So I have
    something to cheer about. But I guess I cannot blame you for
    that, but I recognize the frustration.
        Let me ask you, Ticketmaster's dominant position in the
    marketplace, how does it hurt consumers? Mr. Groetzinger?
        Mr. Groetzinger. Most fundamentally by eliminating
    competition. There is not a vibrant group of dozens of
    companies out there competing to build the best consumer
    experience.
        Senator Cruz. And what does that mean if you want to go, go
    see a game? What does that mean for a consumer? How is life
    worse because there is not a more effective competition in the
    marketplace?
        Mr. Groetzinger. It means you are beholden to whatever
    Ticketmaster-Live Nation gives you, and they have an incentive
    to not innovate and to maintain the status quo because the
    status quo benefits them versus having a vibrant group of
    competition that is working to do what is best for consumers,
    artists, venues, all of the stakeholders in this industry.
        Senator Cruz. Mr. Mickelson?
        Mr. Mickelson. It is a bigger question than just
    Ticketmaster because when you combine Live Nation with
    Ticketmaster, it is the different question.
        Senator Cruz. Well, answer it that way then, the two
    together.
        Mr. Mickelson. Yes. Look, the combination of the two
    provides them with a different business model than the rest of
    us independent promoters. We have to make money at putting on
    concerts. They do not because they make more money from
    ticketing and from sponsorship than they do from concerts. And
    concerts is basically a loss leader for them to bring more
    talent and bring more content to the arenas that they are
    servicing to get the ticketing contracts.
        Senator Cruz. So your testimony is they are essentially
    undercutting the competition in the live performance market and
    subsidizing it using the ticket revenue. Is that right?
        Mr. Mickelson. Ticket revenue and sponsorship revenue, yes.
        Senator Cruz. Okay. Mr. Nuzzo?
        Mr. Nuzzo. And here is how it looks to the consumer. A
    friend of mine sent me a screen shot of a ticket purchase she
    made for I believe it was a Shania Twain concert in Orlando,
    and the tickets were $227 each. But when she got to the final
    screen where she had to actually hit the button to make the
    order, they turned into $291 a piece. That works out to a 30
    percent bump on the very last screen of the transaction.
        She had no choice at that point but to accept that bump in
    price. That is how it looks to a consumer.
        Senator Cruz. Ms. Bradish?
        Ms. Bradish. Well, I think Sal brings up a great point with
    choice. It reduces the choice. Not just of consumers who have
    to pay higher ticket fees, but also of artists like Mr.
    Lawrence. They do not have a choice of what venues to go to,
    what ticketing businesses that they will be dealing with. And
    for others all up and down the supply chain in live
    entertainment, these kind of behaviors reduce choice.
        Senator Cruz. And Mr. Lawrence, finally, for artists what
    is the impact?
        Mr. Lawrence. The impact is that we have very little say or
    transparency or choice in a lot of aspects of how the
    financials of our deals are put together and no say or choice
    or visibility in what our fans experience when buying our
    tickets.
        Senator Cruz. And if the Chair will give me the indulgence
    of one very quick final question?
        Senator Klobuchar. Sure.
        Senator Cruz. Which is one of the things that has come up
    has been all-in ticketing, both for consumers and/or
    transparency for artists. Do any of the witnesses disagree with
    the proposition that that would be a good idea and a material
    improvement from where we are today?
        Mr. Mickelson. No disagreement from Jam as an independent
    promoter, none.
        Senator Cruz. Okay. Well, some area of agreement. That is
    always a good thing. Now if you could help the Texans, that
    would be appreciated.
        Senator Klobuchar. All right. Thank you, Senator Cruz.
        And I just want to clarify, Senator Cruz had some good
    questions about the market percentage of you, Mr. Mickelson,
    and you brought them up. And because I think people need to
    hear these numbers. So according to your testimony, 87 percent
    of Billboard's Top 40 tours in 2022 were performed at venues
    ticketed by Ticketmaster. Is that right?
        Mr. Mickelson. That is correct, 80--yes, 87 percent.
        Senator Klobuchar. Eighty-seven percent.
        Mr. Mickelson. Yes, correct.
        Senator Klobuchar. And do you disagree with that, Mr.
    Berchtold?
        Mr. Berchtold. I do not know the numbers that he is talking
    about. I have not done the analysis. So I could not comment on
    it.
        Senator Klobuchar. Okay. Well, we will do that in writing,
    but it seems to me like that is a lot.
        Okay. And then, second, another thing that he brought up,
    you brought up, Mr. Mickelson, in answer to Senator Cruz.
    Today, 87 percent of NBA teams, 87.5 percent of NHL teams, and
    93 percent of NFL teams--I assume including the Vikings--have
    exclusive ticketing agreements with Ticketmaster. Is that
    right?
        Mr. Mickelson. That is correct. And the teams are broken
    down in my testimony that I provided.
        Senator Klobuchar. Okay. Dispute?
        Mr. Berchtold. That seems inconsistent, Senator, with the
    information that I indicated about SeatGeek taking between 2018
    and 2022, 15 percent of the NFL and the NBA market.
        Senator Klobuchar. Okay. Well----
        Mr. Berchtold. I would say that I do acknowledge we
    absolutely have the leading share in those because--there is no
    mystery--we have the best product, and we have a product that
    is particularly suited to the very----
        Senator Klobuchar. Okay. We were just doing----
        Mr. Berchtold [continuing]. Complex requirements----
        Senator Klobuchar. We were just doing facts here. So, but I
    understand your answer.
        Mr. Groetzinger, do you want to reply to that?
        Mr. Groetzinger. Yes. I wholeheartedly disagree with the
    assertion around product. I think we do not know who has the
    best product because there is not competition. There is only
    one real choice that a venue can make.
        Senator Klobuchar. Okay. And then, in 2020, the DOJ
    confirmed that Ticketmaster has been the, quote, ``largest
    primary ticketing service provider for major concert venues in
    the United States for at least three decades.'' I do not think
    we doubt that. Anyone?
        Okay. Next, Live Nation revenue grew from $5 billion to
    over $11.5 billion from 2010 to 2019. Is that correct, Mr.
    Berchtold?
        Mr. Berchtold. I do not have the exact numbers, but that
    sounds right.
        Senator Klobuchar. Okay. Then we have--I am just going to
    quote from a New York Times article, 2018, that said this. And
    if it is wrong, you tell me. And maybe it has changed a bit
    because it is 2018: ``Ticket prices are at record highs,
    service fees are far from reduced, and Ticketmaster, part of
    the Live Nation empire, still tickets 80 of the top 100 arenas
    in the country. No other company has more than a handful. No
    competitor has risen to challenge its preeminence.''
        Mr. Berchtold. As I indicated in my comments--I believe you
    said that was 2018. Between 2018 and 2022, SeatGeek in
    particular has been very effective in winning major NFL and NBA
    clients.
        Senator Klobuchar. Okay, but do you know, Mr. Groetzinger,
    if we are like 5 off for the number of arenas or what we are
    here?
        Mr. Groetzinger. I think we are debating small percentages.
    The--my data that our team polled was that Ticketmaster is the
    primary ticketing provider for more than 80 percent of the NBA,
    NHL, and NFL teams. I would also note----
        Senator Klobuchar. More than? Say it again.
        Mr. Groetzinger. More than 80 percent.
        Senator Klobuchar. Eighty percent.
        Mr. Groetzinger. Yes. And that was around the same
    percentage back in 2009, when we were first looking at this.
        Senator Klobuchar. Yes. I just want to dispel this notion,
    Ms. Bradish, that this is not a monopoly, and then we can go
    from there about solutions. So, so let us talk about that.
        Ms. Bradish, you talked about the need to update our
    antitrust laws. Senator Lee and I have had numerous hearings.
    We have made headway, as I noted, at the end of the year to
    focus to help our antitrust enforcers so they are not taking on
    the biggest companies the world has ever known with duct tape
    and band-aids, when we know the number of people that work at
    these agencies are in some cases less than it was during the
    Nixon administration, and yet these companies have grown bigger
    and bigger. So I appreciate the support of the United States
    Senate on this front, Democrats and Republicans.
        Now we have to go to the next step, which is albeit harder.
    We have some specific things we are all working on--on tech
    when it comes to issues like ticket prices. But the issue here
    is that we have seen a narrowing of our antitrust laws, and
    that is why I think for both discriminatory conduct and
    mergers, we need to step back a bit, as a number of us have on
    this Committee, and look at some changes. They do not have to
    be exactly the changes each person wants, but could you talk
    about the importance of making it easier to enforce these
    antitrust laws when we have seen 75 percent of the industries
    in our Nation, from cat food to caskets, see more
    consolidation?
        Ms. Bradish. Yes. I mean, in particular with respect to
    vertical mergers and monopolization Section 2 cases, case law
    has narrowed and narrowed and narrowed the window for the
    enforcers to go after this kind of conduct. So anything that
    will open that window, that will give an opportunity for the
    enforcers to actually get at this conduct and this kind of
    merger activity is going to be what we need to restore
    competition.
        Senator Klobuchar. Okay. Anyone want to add to that?
        Okay. Some of today's witnesses we know have raised--and we
    really appreciate all of you--concerns about ticketing,
    especially you, Mr. Lawrence, with some very practical things.
    It would be great if some of these kind of smaller things that
    are difficult for you to deal with just got resolved after this
    hearing. We love that. Shows we did something for the day for a
    change.
        [Laughter.]
        Senator Klobuchar. So that is great. But I think we all
    know, as Ms. Bradish has been pointing out and as Mr. Mickelson
    and Mr. Groetzinger and Mr. Nuzzo have been pointing out, these
    things are sometimes bigger than that. And let us get what we
    can right now, but there are bigger things.
        So one of the things we have heard complaints about is so-
    called drip pricing, when the consumer does not see the full
    price of the ticket, including fees, up front and has to wait
    until near the end of the transaction process to get the final
    price. This is what was just pointed out, right, Mr. Nuzzo?
        Mr. Nuzzo. Yes, correct.
        Senator Klobuchar. Okay, very good. Should Congress mandate
    all-in pricing on ticketing platforms so that the full ticket
    price is disclosed up front?
        Mr. Nuzzo. I would stipulate that there is likely an
    interstate commerce reason for Congress to act in this
    capacity. I live in north Florida. There are a lot of people
    from south Georgia that come to Tallahassee occasionally when
    the Florida State Seminoles are having a winning season. And so
    from the extent and the nexus of interstate commerce, I would
    stipulate there is probably a window for Congress to act, even
    though I would also like to state on most issues I am a States
    person.
        Senator Klobuchar. I just guessed it.
        [Laughter.]
        Senator Klobuchar. Okay. Anything anyone wants to add to
    that? I noticed you were consulting with--I would like to say
    your lawyer, but it is your bandmate, Mr. Lawrence----
        Mr. Lawrence. Yes.
        [Laughter.]
        Senator Klobuchar [continuing]. In answer to this question.
    It was very----
        Mr. Lawrence. He doubles as the saxophonist----
        Senator Klobuchar [continuing]. Very impressive. All right.
    Go ahead.
        Mr. Lawrence. I just wanted to say I think while the spirit
    of the all-in pricing thing is a great idea, a concern that I
    have is if artists continue to have no say in the----
        Senator Klobuchar. Got it.
        Mr. Lawrence [continuing]. On-top portion of the fees.
        Senator Klobuchar. Yes.
        Mr. Lawrence. Then like while, as we talked about, I do
    have a say in setting the base ticket price, all of a sudden if
    I set a ticket price of $30, but then they are just seeing an
    all-in fee of $50, at least in the current system, fans know
    which is the base ticket price and which is the fee.
        So even if the drip pricing were eliminated, it would still
    be great to know----
        Senator Klobuchar. You want to do something up front to--go
    ahead.
        Mr. Lawrence. If there was something on that first screen
    that still said these are the added Ticketmaster fees.
        Senator Klobuchar. Agree.
        Mr. Lawrence. So that the fans know.
        Senator Klobuchar. That was my second question.
        Mr. Lawrence. Yes.
        Senator Klobuchar. Like you should be a Senator, I think.
        [Laughter.]
        Senator Klobuchar. So what you are saying is you want to
    have the--you want to know, differentiate on the fees, and then
    you also want to deal with this pricing thing at the end.
        Mr. Lawrence. What I really want is for artists to have a
    say in those fees and for them to be lower. But in the
    current--under the current system where we have absolutely no
    say or transparency in the fees, yes, I would not want to have
    to take any responsibility of those to our fans.
        Senator Klobuchar. Okay. We have--anyone on this?
        Okay. We also have heard about sellers offering to sell
    tickets they do not even have. That is speculative ticket sales
    when they do not have it. Is that something that Congress
    should prohibit?
        Mr. Mickelson?
        Mr. Mickelson. Definitely. I mean, you go on--you go online
    on any high-demand show, and they are selling tickets that they
    do not have. Absolutely. And Mr. Berchtold could certainly
    opine about that, but that needs to be banned somehow.
        I do not know whether it is Congress or by State by State,
    but something needs to be done. It is deceptive and just not
    right.
        Senator Klobuchar. Okay. Then we--I know you, Ms. Bradish,
    talked about this idea of spinning off companies. We have all
    seen that as a remedy that would most likely be coming from the
    Justice Department. So all we can do here is put forward the
    evidence, and these are sworn testimonies back and forth under
    law so that the Justice Department can look at this discussion.
    But clearly, this is something that could be looked at.
        Because I think we can legislate on some of these things
    about pricing, but if you truly have a situation where you have
    a monopoly on these--this three corners of this triangle,
    right, which is--which is this combo of the ticketing and the
    promotions and then the arenas, or not all arenas are on the
    long contracts--long-term contracts on the arenas. That is also
    an issue that we--that creates this problem for us where the
    customers are basically trapped in the middle.
        So anything anyone wants to comment about that, and how
    that would aid you in competing, Mr. Groetzinger or Mr.
    Mickelson?
        Mr. Mickelson. Thank you.
        Again, when I look back at history, which always guides us,
    I look back at the Paramount case, U.S. v. Paramount in the
    late 1940s, where the movie studios contracted and controlled
    the actors. They made the films. They had the distributor, and
    they had the movie theaters that those played in. The
    Government broke that up, and then it became fairer for
    everybody else to compete. So I think that is a solution you
    need to look at.
        I think another solution might be maybe no exclusive
    ticketing contracts at buildings. In Europe, in the UK, they do
    not have exclusive ticketing contracts.
        Senator Klobuchar. That is what my last question was going
    to be.
        Mr. Mickelson. Sorry.
        Senator Klobuchar. And we will count that answer--no, it is
    interesting. So they do not have that----
        Mr. Mickelson. Right.
        Senator Klobuchar [continuing]. in Europe? Okay. All right.
    Anything more?
        Mr. Groetzinger. Oh, sorry. I was just going to mention
    another difference between the Europe and U.S. market is that
    for Europe soccer teams, for EPL teams, they typically do not
    have concerts. So they are not worried about this whole concert
    threat that we have been talking about.
        Senator Klobuchar. Mm-hmm.
        Mr. Groetzinger. And as a result, you see a markedly
    different market outcome where those venues actually make the
    ticketing decision based on the merits of the product, what is
    actually best for their fans and best for their business.
        Senator Klobuchar. Mm-hmm.
        Mr. Groetzinger. And we have been talking about the 80
    percent or so market share that Ticketmaster has here in the
    U.S. among major sports teams. That is only 20, 20 percent of
    EPL teams. Where SeatGeek is fortunate, due to a stronger
    product, they have about 10 of the 20 EPL teams there.
        Senator Klobuchar. Okay. Senator Lee is deferring to
    Senator Blackburn. Thank you.
        Senator Blackburn. And thank you, Madam Chairman.
        Let me just say we do appreciate you all being here, and we
    need--Music City USA needs you all to be successful. And this
    is an issue of fairness. Whether it is the consumer, whether it
    is the artist, whether it is the production manager, this is an
    issue of fairness. And right now, we have a system that is not
    fair.
        Now I want to pick up on the issue of spec tickets. And Mr.
    Berchtold, you and I discussed this a little bit yesterday, and
    you mentioned the Madonna tour that already there are tickets
    available on the secondary market. This is presale, pre the
    window opening. You have Zach Bryan, who is not working with
    you, but on his tour. But you said the secondary market has
    those tickets.
        Well, as I thought about this last night and thought about
    our discussion and worked on my questions, I thought why is it
    that these secondary markets are so brazen that they would go
    ahead and put these tickets up for sale? It does not make
    sense, does it?
        But you know what does, what it does is raise the question
    is it that the bots have become so aggressive and so certain
    that you are not going to do anything to them, that you are not
    going to shut them down, that they just move forward and
    advertise things they have not yet purchased because they have
    figured out you will not call the FTC. You will not report
    them. You have not built the kind of cyber safeguards that are
    necessary to protect the consumer, and you are building a
    treasure trove of information on these consumers.
        I bet you even have a marketing arm that takes all that
    data. You know somebody is partial to some certain type tours,
    and then you are marketing back to them, sending them
    notifications. But let us talk about this. Why is it that you
    believe these sites have moved forward with advertising tickets
    that they have not yet purchased? Why are they so confident?
        Mr. Berchtold. Senator, I agree with your assessment that
    those markets that put up----
        Senator Blackburn. Okay, you agree with my assessment, sir.
        Mr. Berchtold. Yes. Yes.
        Senator Blackburn. So what are you going to do about this?
    Are you going to strengthen your protections so that these bots
    cannot get in there?
        You know, you told me yesterday--let us talk about this a
    little bit. You told me yesterday that you have a difficult
    time deciding what is a bot and what is a consumer. So why is
    it that you have not developed an algorithm to sort out what is
    a bot and what is a consumer? Why is it that the bank can do
    it? As I said earlier, why is it the local power company can do
    it, but you cannot?
        Mr. Berchtold. Yes, Senator. We are continually investing
    in advance bot detection. It is an arms race. There is so much
    money at stake.
        Senator Blackburn. Well, how much have you invested, and
    what is your timeline for securing your site so that consumers
    know their data is secure with you? When are you planning to
    have this done?
        Mr. Berchtold. Yes. We have invested over $1 billion over
    the past decade. In addition to specific technology to stop
    bots, we have developed products such as Verified Fan, which is
    intended----
        Senator Blackburn. Okay. As we talk about Verified Fan, why
    is it that that data is not protected to the point to prohibit
    these incursions and these hacks coming in to that information?
    And as you have precleared these individuals and pass them as
    Verified Fans, then what are you doing to protect their
    information? How do they know that their information is secure
    on your site?
        Mr. Berchtold. Yes, Senator. Using Verified Fan, the bots
    have not gotten in. But that does not stop them from attacking
    the system.
        Senator Blackburn. Well, you told us that with the Taylor
    Swift instance, that it was the Verified Fan that was a
    problem. So is Verified Fan safe, or is Verified Fan not safe?
    I mean, which--what are we looking at here?
        Mr. Berchtold. Verified Fan was effective in making sure
    that the tickets that were sold were sold to fans. It was
    successful in that we are compliant with CCPA, with GDPR in
    terms of data security. It was an issue of the load on the
    system from the combination of bots pretending to be humans to
    try to get in.
        Senator Blackburn. Oh, so you were underestimating the
    popularity of a Taylor Swift concert and ticket.
        Now let me ask you about this. This is another thing I
    thought about from our conversation yesterday. You said that
    the only course of action for Ticketmaster in identifying a
    buyer is a bot is after the transaction is completed. You said
    you could not tell until after.
        Because I discussed with you how some fans will have
    tickets in their cart, and then during the checkout process,
    the tickets leave the cart. And I asked why you would not empty
    the cart of the bot. And you said, well, it is hard to figure
    this out until the transaction is completed.
        So why is it that you can only do that? Why can't you
    algorithmically flag these suspicious transactions during the
    sale process? Because once they have got that, then the
    consumer cannot get that ticket. Once they are into somebody's
    cart and you are processing that card, then that is not
    available to the consumer.
        So, sir, with all due respect, you have not solved your
    problem by saying, well, we flag it at the end. The issue is
    you have got to beef up your systems, your verification
    systems. You have to strengthen your cyber protections. Sounds
    like you need to some good advice on how to follow some of the
    protections that are there for financial institutions and
    credit card processors and healthcare institutions and
    utilities.
        And we are hopeful that you are going to be able to do
    that. As I said, we need all of you to be successful and to be
    fair.
        And by the way, Mr. Lawrence, come to Nashville. Be happy
    to have you there.
        Thank you, Madam Chairman.
        Mr. Lawrence. Absolutely.
        Senator Klobuchar. There you go. A good invitation.
        Senator Lee.
        Senator Lee. Thanks so much.
        We have had a lot of talk in the last few rounds about
    restrictions on the ability of a consumer, a purchaser of a
    ticket, being able to sell it to someone else. A lot of people
    seem to think that is somehow a solution. I think it is a
    ``nightmare dressed like a daydream.'' I do not think we ought
    to go there. There are a lot of complaints about doing this.
        Look, no one is particularly fond of scalpers, generally
    speaking. But this is not about scalpers. This is about the
    purchasers of the tickets themselves. They may have perfectly
    legitimate reasons, whether it is a change of plans or
    otherwise, to resell tickets that they have already purchased.
        In a number of States, including New York, Illinois, and my
    home State of Utah, we have laws that restrict these sorts of
    things. In Utah specifically, the Ticket Transferability Act in
    place in my State requires that at least 90 percent of tickets
    for an event be transferrable.
        And so, Mr. Nuzzo, we will start with you on this one. Do
    you think Federal policymakers ought to take a similar approach
    with this, or is this particular issue best left to the States?
        Mr. Nuzzo. Thank you, Senator.
        And I would reiterate the comment I made earlier about
    there being a nexus with interstate commerce. In any State, you
    are going to have folks from out of State purchasing tickets to
    an in-State concert event, sports stadium. So there is a role
    for the Congress to play in this.
        Senator Lee. Is it one that needs to be played? I mean, you
    are not suggesting that there would be a dormant commerce--I
    could not resist----
        Senator Klobuchar. Oh, no.
        Senator Lee [continuing]. Would not be a dormant commerce
    problem with the States doing it?
        Mr. Nuzzo. No. No, I do not. But I do recognize the
    efficiencies by a Federal solution, as opposed to a 50-State
    patchwork, in this realm.
        Senator Lee. That makes sense.
        Ms. Bradish, the most common justification that we hear
    when this sort of thing comes up about ticket transferability
    is that artists want it. And now the artists, as the argument
    goes, want to stop scalpers and help their friends, help their
    followers, their biggest fans. But why should artists be able
    to tell their fans what to do with a ticket purchased from the
    venue?
        Does that really sound like something that you would do in
    defense of the very same people you want to buy your ticket is
    tell them if you have got a change in plans you are out of
    luck, or does it sound more like Ticketmaster and certain other
    actors, including in some cases artists, are simply sharing
    monopoly rent?
        Ms. Bradish. Exactly. And I think what this points out is
    that when an industry suggests its own cures, we also have to
    look at the possibility that it has another effect, which is in
    this case perhaps to keep customers within the Ticketmaster
    ecosystem.
        Senator Lee. Right. Right.
        Mr. Groetzinger, sticking to the issue of ticket
    transferability, it seems to be that impairing transferability
    might also harm competition and, therefore, consumers, by
    preventing legitimate secondary ticketing companies from
    gaining any traction. And the logic there is that if you are
    stopping legitimate secondary ticketing companies from gaining
    any traction, you are also forestalling would-be future nascent
    competitors who could rise up through the marketplace and
    potentially challenge Ticketmaster. Do you share this concern?
        Mr. Groetzinger. I think that is exactly right, and I think
    this industry already lacks competition. Reducing
    transferability just exacerbates that problem. A related issue
    is if the incumbent were to allow transferability, but only on
    its own platform or only allow fulfillment on its own platform,
    it is a way to force all consumer data and all transaction fees
    onto that platform.
        Senator Lee. Right. Now, Mr. Berchtold, if I purchase a
    ticket on Ticketmaster, is that my ticket? And if it is my
    ticket, is that not my property to use or dispose of or
    transfer as I deem fit?
        Mr. Berchtold. Senator, I think this discussion on
    transferability exists simply because of the volume of
    industrial scalping that takes place, the harvesting of those
    tickets that disrupts the relationship between the artist and
    the fan. And as we submitted, one of the notes was a letter
    from Garth Brooks, who is well known for being one of the
    leading advocates of providing a great show and a great value
    for his fans, who called out very specifically that it is the
    scalping that takes place that is the origin of the problems
    that we have, and everything else is a derivative issue.
        Senator Lee. Well, there are other issues, of course. And
    that may be his view, but he is not--I do not think he is
    necessarily considering the consumer welfare standard or the
    Sherman Act or the Clayton Act when making that statement.
        So I am going to ask you this. Will you, on behalf of
    Ticketmaster, commit right now to offering fair, reasonable,
    nondiscriminatory API access to legitimate secondary ticketing
    services to facilitate the safe and easy transfer of tickets
    without limiting customers to the Ticketmaster app? And if not,
    why not?
        Mr. Berchtold. Senator, first, we believe that the artist
    does have the right to set the rules by which ticket transfer
    takes place in today's environment with the high volume of
    scalping. Second, with digital tickets, there needs to be the
    maintenance of a digital right master that is held centrally.
    And as part of fraud prevention, we are not going to put that
    out in the wild to enable fraud.
        Senator Lee. I would like to get Mr. Groetzinger's response
    to that and also ask Mr. Groetzinger to just talk about how
    competition with Ticketmaster has impacted innovation in the
    ticketing space.
        Mr. Groetzinger. The NFL provides a great counter example
    to that, where the NFL has created an ecosystem where
    ourselves, Ticketmaster, and StubHub all compete. Those APIs
    exist, and it works really well for NFL fans. There is no
    technical reason, there is no master manifest reason that could
    not exist in other venues. It is just a business reason that it
    does not. And I am sorry, I forgot your other question.
        Senator Lee. Just tell me how competition with
    Ticketmaster, how has competition with Ticketmaster impacted
    innovation in the ticketing space?
        Mr. Groetzinger. I think it has severely stunted it. Like I
    mentioned earlier, I would love to have a ton of brilliant,
    vibrant developers and companies trying to make better
    solutions, trying to--I would love that this bot issue we have
    not been talking about for a decade because so many people have
    been competing to build a better mousetrap that it did not
    exist anymore.
        Senator Lee. Right.
        Mr. Groetzinger. And unfortunately, that is not----
        Senator Lee. So the absence of competition has stunted it.
    To the extent you were able to see some developing semblance of
    competition, how does or how will or how would that impact
    innovation in the ticketing space?
        Mr. Groetzinger. Yes, what makes it really hard for us is
    we are trying our darnedest to build the absolute best
    ticketing software on Earth and make tickets more accessible to
    fans, get more people to go to events. We believe we have that.
    We will then go to a venue and try to bid competitively, and
    they make a choice against what is the best technology because
    they are afraid of losing concerts if they do not choose
    SeatGeek. And I think while that underlying reality exists, it
    is going to be very, very hard, if not impossible, to have a
    fair, vibrant, competitive market.
        Senator Lee. Thank you. I see my time has expired.
        Thank you, Madam Chair.
        Senator Klobuchar. Very good. Senator Hawley.
        Senator Hawley. Thank you, Madam Chair.
        Mr. Berchtold, if I could just come back to you. You told
    me in our last exchange that a safe ticket, a digital ticket
    with Ticketmaster, could be sold elsewhere. On StubHub, for
    example, right? Am I remembering correctly?
        Mr. Berchtold. Yes, Senator.
        Senator Hawley. But what you did not say, but which is I
    think deeply relevant here, is that in order to get that
    digital ticket, the person who buys it has to come inside the
    Ticketmaster ecosystem. Correct? They have got to get the
    Ticketmaster app because it is a digital Ticketmaster ticket.
    Yes?
        Mr. Berchtold. Yes. That is the same standard if I buy a
    ticket on a--from a venue that SeatGeek is the primary
    ticketing provider for. If I want to buy a ticket on Vivid, I
    then have to have a SeatGeek app in the same way.
        Senator Hawley. Well, this is a huge advantage to you,
    though, is it not? Because if you are forcing any buyer--and we
    are talking about the resale market here, just to be clear. In
    the resale market, you are forcing any purchaser to come into
    your ecosystem to sign up. And I notice, by the way, that you
    advertise--this is from your own website. You advertise that
    one of the advantages of the safe ticket digital ticket is that
    it will allow event owners to communicate directly with event
    attendees, including those who buy their ticket through resale,
    and allow them to engage with the attendees after an event is
    over.
        In other words, you are talking about data. You are
    selling, effectively, the data of all of these people who have
    not bought direct from you. They want to buy on the resale
    market, but they have got to come into your ecosystem and give
    you their data in order to get this ticket. That is tremendous
    advantage to you, no?
        Mr. Berchtold. It is--Senator, it does not quite work that
    way. It is our policy that if an account is established solely
    for the purposes of receiving a ticket, we do not use that data
    for purposes of marketing.
        Senator Hawley. So, wait a minute. They cannot
    communicate--when you say on your website that anybody who has
    a safe ticket, that the event owner will be able to engage with
    them once the event is over, will be able to offer personalized
    food and beverage and merchandise offers, that is not true?
        Mr. Berchtold. In the context of the event itself, I
    believe there is some ability to reach out to connect with
    those fans----
        Senator Hawley. Once the event is over, you say.
        Mr. Berchtold. Ticketmaster does not use that data for
    marketing to individuals.
        Senator Hawley. Well, how do they contact them once the
    event is over?
        Mr. Berchtold. That copy may not be accurate, sir.
        Senator Hawley. This is on your website.
        Mr. Berchtold. Yes, I will have to look at it and----
        Senator Hawley. This is how you are advertising your
    digital ticketing to folks who--to event owners.
        Mr. Berchtold. Yes. I will have to take a look at that. It
    does not sound accurate.
        Senator Hawley. Well, what it sounds like is a data
    industrial complex. I mean that you, a monopoly, are now
    forcing--in the resale market, you are using your monopoly on
    the front end to create a monopoly in the resale market, where
    you are forcing everybody in the resale market to come into
    your ecosystem, effectively. Of course, you also have your own
    resale platform.
        So, I mean, basically they are going to have to come into
    your ecosystem anyway to get a ticket that they bought on
    StubHub. Why even go to StubHub or anywhere else? Why not just
    come to you directly, right?
        I mean, this is how monopolies work. You leverage market
    power in one market to get market power in another market, and
    it looks like you are doing that in, frankly, multiple markets.
    You are doing it in the resale market. You are doing it with
    data.
        Mr. Groetzinger, you are nodding your head. Am I right
    about this?
        Mr. Groetzinger. Yes. Very much agree.
        Senator Hawley. Just explain to everybody why that is
    significant. Because you commented on this just a second ago.
    You said that if you had a player who could force everybody
    onto one platform and all consumers to put their data into one
    person's platform, we would have a big problem. Is that not
    what Ticketmaster is doing, effectively?
        Mr. Groetzinger. Exactly. And it stifles competition
    completely. We were giving the StubHub example earlier. Mr.
    Berchtold gave the example of the StubHub seller having to then
    transfer on Ticketmaster. The reality is that recipient needs
    to create a Ticketmaster account, download the app, sign in.
    Basically, they are forced to sign up to Ticketmaster just to
    receive the ticket that they bought on StubHub.
        Senator Hawley. Yes, when you think about it, it is really
    something. You are forcing everybody who just wants to get this
    ticket on the resale market who has not bought from you, Mr.
    Berchtold, to begin with. You are forcing them to become your
    customer in order to take possession of this ticket.
        I mean, that is--that is really something. I mean, hats off
    to you, I guess, for being innovative and using your monopoly.
    But I have to tell you, from a competition standpoint, this
    really, really worries me because this looks like a way to,
    again, further leverage your market power in one market to
    expand it into other markets. And I just do not see how
    consumers win out of this exchange.
        Thank you, Madam Chair.
        Senator Klobuchar. Very good. Thank you. Well said, Senator
    Hawley.
        Do you want to have a closing statement here, Senator Lee?
    I think we end, as we always do, with the two of us. Please go
    ahead.
        Senator Lee. This has been a really helpful hearing. I
    appreciated each of your comments and insights. It is the first
    time we have ever held an antitrust hearing with a band member
    rather than a lawyer accompanying a witness, and so thank you
    for coming as well.
        This is an important issue, and it relates to a lot of
    things that we confront on this Subcommittee from time to time.
    It deals with the intersection of consumer rights, consumer
    welfare, and our antitrust laws. And so it is very important
    that we maintain fair, free, open, and even fierce competition
    in this as in every other space.
        And the reason we focus on that is because when there is
    competition, it does two things, both of which are very
    valuable to the average American. It increases quality, and it
    reduces price. We want those things to happen, and so that is
    why we focus as we do on this.
        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 is all I have got to say. Thank you.
        Senator Klobuchar. Well, thank you, Senator Lee.
        I throw out one other one, and that is when I believe she
    said to you if you do not do a hearing on this, I am going to
    call Amy Klobuchar directly. Is that possible?
        [Laughter.]
        Senator Klobuchar. Okay, very good.
        All right. So I want to thank all of our witnesses. I think
    this was a good hearing because we had Senators on both sides
    of the aisle making very valid points about competition. It may
    have been a coincidence it was the first hearing of the entire
    Congress, but maybe not.
        Because, one, it was bipartisan. Good sign for the Senate.
    Two, it was about competition and our economy that goes way
    beyond the ticketing industry. As I have pointed out, 75
    percent of the industries in this country we have seen more and
    more consolidation.
        We have an active Justice Department now and FTC. We have
    provided them funding because we actually know they bring money
    in when they do their job. But mostly, this has also been
    reflected in so many of my colleagues' comments about fans. It
    is about those events that bring us together, and especially as
    we come out of this pandemic and come out of our 300 million-
    plus silos, people have loved going to see live music again, to
    see live concerts, to be part of that experience.
        And one of our goals here, regardless of what State people
    are from or what party that they belong to, is to give them
    that experience. Mr. Lawrence, to make them feel part of a fan
    base and part of something that makes them feel good or makes
    them think about the lyrics to a song or makes them just
    rejoice in being part of our arts and part of our culture. So
    that is why you have seen this tremendous turnout here.
        We are very interested in actually doing something and not
    just throwing popcorn. I think you know we have been respectful
    throughout this hearing, and I think part of that is our desire
    to actually move on this issue.
        As I have noted, even getting the public's attention on
    this--and we know, we thank the fans that may be still outside,
    we hope still watching on C-SPAN. I thank them for keeping this
    alive, and I thank all of you for your work in this important
    industry.
        But the solutions are there for the taking. Some of them
    are smaller things that can be done right away. Some of them
    are things that the Justice Department may order as either part
    of their oversight with the consent decree or new
    investigations or new outcomes, some of which have been
    discussed here. Some of them are things that we can do right
    here. And of course, we are always going to have some
    disagreements in this body, I do not think you are surprised,
    over what the best course is, but there is some general
    agreement on some of these ideas when it comes to pricing and
    transparency and the like.
        And finally, our job is oversight and making sure that our
    agencies that actually do the work are funded so they can do
    it. And I am proud of the work we did at the close of last year
    to do that.
        So, with that, we are going to keep the record open for a
    week. I want to thank our staff for their work on it, and in
    particular, Marc and Avery and Keagan, who are behind me, and
    also Senator Lee's staff for their work on this, as well as
    Senator Grassley's staff over the many years on this issue, and
    Senator Durbin for allowing us to have this hearing when we do
    not even have the Subcommittees formed yet so we can get
    working on this right away.
        So, with that, the hearing record is going to remain open
    for 1 week until January 31, 2023.
        Thank you very much. The hearing is now over and adjourned.
        [Whereupon, at 12:51 p.m., the hearing was adjourned.]
        [Additional material submitted for the record follows.]

                                A P P E N D I X

                  Additional Material Submitted for the Record

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                      Prepared Statement of Clyde Lawrence

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    Responses of Jack Groetzinger to Questions Submitted by Senator Booker,
               Senator Padilla, Senator Cruz, and Senator Tillis

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