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And… it’s over. Hitsville’s complete Ticketmaster/Live Nation coverage is here.

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Hurwitz’ final statement: The play here is control.

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Key question: Could a major act, Bruce Springsteen, say, do a big tour without using Live Nation or Ticketmaster?

Michelson says no, on the amphitheater level, he couldn’t; indoor arenas, “I suppose.”

Ticketmaster, however, he notes, would be an impediment on that level.

__________

Mickelson is finally fed up with the LN line, particularly the contention that it only has 38 percent of the business.

His summation is the highpoint of the hearing thus far.

Mickelson quotes Pollstar: In 2000, the company had 150 of top 200 tours. In 2001, after Live Nation combined with SFX, it had 161 of the  top 200 tours.

He’s just getting going: “They dominate the arena level. They control and have all of the outdoor amphitheaters. They own 90 percent of the amphitheater market.” And with House of Blues [an LN subsidiary], they are taking over the lower-level theater business as well.

TM, he says, has contracts with 90 of the top 50 buildings, 80 percent of top 100 arenas.

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Rapino says he could establish a firewall to stop TM from passing on info to LN. That’s a comical assertion.

Rapino is forced to concede he got out of competing with Ticketmaster. Why would anyone else try to compete?, he is asked.  He dissembles and changes the subject.

He tries to say ticketing  a “low barrier” business to get into.

________

Hurwitz and Mickelson both point out that if the companies merge, he and other indie promoters would have to share all sorts of sensitive information with the behemoth—tickets sold, customer contact info and so forth. And they will make money on every ticket of his they sell, he points out.

Balto is smarter on these issues than anyone else there. “If vertical integration is necessary,” he says, “let them do it on their own. That’s the purpose of the anti-trust laws.”

________

Mickelson smacks Rapino down for saying acts can call around to other promoters. “U2 doesn’t call us. Shakira doesn’t call us. Coldplay doesn’t call us.”

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In fairness, there is something to Rapino’s point. The problem is that all these other parasitical companies are trying to make a buck on the backs of the artists.

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Klobuchar zeroes in how the companies are refraining from competing; the next step, she notes, is figuring out how difficult it will be or a new competitor to emerge. Ticketmaster’s long-term contracts, funded by kickbacks from fees, make that difficult. Balto, channeling Hitsville, says the “technology involved is not rocket science.”

Rapino points out that the true monopoly is the artist. “There is only one Aerosmith.” This is true in the physical but not aesthetic sense. Me, I stopped paying attention to Aerosmith when they hired Diane Warren to write songs for them, but whatever.

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Klobuchar is now going after Azoff, pressing him to admit that previous mergers haven’t lowered ticket fees. Azoff is now saying Ticketmaster “took the heat” for the big fees, which it got a “minority part” of. Where’d the rest go? “Credit card fees” (!) Then he mentions “rebates” to the venues, “sometimes to the artists, sometimes to the promoters.” Those are actually kickbacks. 

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A new euphemism for auction sales. “I would hope for a more transparent accurate primary, which wold do away with the need for secondary,” Azoff says. He’s saying he’d like a pure auction sale.

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Azoff says the “practice” of routing people to the resale site was “a practice I was going to do away with.” That’s not very credible.

Schumer wants a detailed explanation of how the Springsteen imbroglio happened, but doesn’t want Azoff to waste all of his questioning time. He wants it all in writing. “It’s under oath,” he reminds him.

Schumer wants Azoff to say that he should sell TicketsNow, the scalping site. Azoff is dissembling. He says he was asking around at the company why they got into the biz. The picture of himself as a wide-eyed new employee is kind of amusing.

Schumer doesn’t ask the obvious question: If the new company is losing money on tickets, it’s going to go where it can make more money—and where else but the reselling sites?

Schumer keeps cutting Azoff off, though. What’s his position on Tickets now? “I never would have bought it. I don’t have a position now,” Azoff replies.

Are you open to sell it? “You can make an offer, senator.”

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Schumer’s hammering Azoff on how the company patently makes more money reselling a ticket than selling it; Schumer keeps saying it’s $30 vs. $7. Azoff keeps demurring. Schumer says he wants an answer in writing.

As I noted in my list of questions yesterday, this would be a good time to say:

It’s hard to remember? Again, forgive me for quoting “Hit Men” again, but one person quoted there saying “He had total retention on every level.” Another is quoted as saying “Irving is as fast mentally as it gets.”

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C-Span is broadcasting the hearing as well, BTW:

http://www.c-span.org/Watch/C-SPAN3_rm.aspx

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Now Schumer is going after Azoff on the Springsteen issue.

———

Wow– more interesting facts. Rapino says he makes $14 per person on “ancillary.” Food, parking, merchandise, I guess. He says he loses $80M a year on tickets—or about 4 percent, as he says. That’s in keeping with other reporting I’ve seen.

He blames it all on the 18 wheelers the artists use. That’s bullshit. The artists make hundreds of millions on these tours.

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Third lie: “Every entertainer I represent would like to charge less for tickets.” (Azoff.)

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Sobering info about Jam: yearly shows down from 135 to 30.

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Kohl says, You didn’t address the question at all. “I’m disturbed by your unwillingness to discuss the main reason for the merger.” (He means makes more money.)

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Azoff opens his mouth … and lies as well. “We are actually complimentary businesses.” “Plenty of competition out there.”

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Kohl: What’s wrong with competition? You strain our common sense!

Rapino … lies. Says there’s a lot of competition. Cites Chicago—where he’s been trying to put Jam out of business

————

David Balto next. “I have a simple message. TM has kept its monopoly power not through better products and services but exclusionary arrangements to exclude its rivals.” Now, faced with a rival, it’s trying to merge with it.

There’s a competitively unhealthy market, he say. Wha’s needed:  1) Investigate the Springsteen incident 2) Look at past Ticketmaster aquisitions; 3) the key to the monopoly power; TM’s exclusivity agreements.

—————–

Hurwitz is magnificent; he’s giving a short history of the modern concert industry. He points out that Don Henley used to be opposed to Clear Channel! He’s trenchant and persuasive; he points out it’s the promoters’ fault. They tout the higher ticket prices as growth and hide losses as “investment.”

“When do they get told to stop? You can’t blame Live Nation at this point any more than you can blame a shark for eating people.”

He points out that a new ticket service would be an expensive proposition.

A great five minutes. This guy’s a star.

———-

Nice to see Jerry Mickelson; he’s a fighter and has been for decades. Jam has been grimly fighting off Live Nation for years.  “The new company has the ability to strengthen its hold on the entire industry.”

It will “suppress or eliminate competition” in every aspect of the music industry. “Vertical integration on steroids.” “A poster child of why this nation wants and needs antitrust laws.”

———-

Azoff is avoiding the particulars of the Springsteen imbroglio; he says there was a ticket malfunction “combined with the availability” of his reselling operation. I have to say, it hasn’t been established that TM actually *drove* fans to the reseller. It could be they just clicked on the (obfuscatory) button that said tix were available.

He’s the voice of doom as well.

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Azoff! He says he saw the Beatles at Comiskey Park. He says he serves artists and their fans. He headed west, he says, with Dan Fogelberg and REO Speedwagon.

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Amid a litany of woes, he says 40 percent of his seats go unsold. I hope a senator asks him why that doesn’t mean he runs a very inefficient company.

————-

I love music, love artists; saw Prince in Minneapolis, he says. It’s a decentralized business. “Local entrepreneurs.” He’s playing the “we supply countless jobs” card.

The decentralization contention is risible; this used to be called Clear Channel. He’s whining about the company’s stock price. He says he needs to merge, basically, to save the company.

“The record business is broken,” he says.

———–

Now it’s Minn. Sen. Amy Klobuchar namechecks Prince and Bob Dylan; she’s not a fan of the merger eitheMinn. Sen. Amy Klobuchar. She namechecks Prince and Bob Dylan; she’s not a fan of the merger either. Now they are swearing in the witnesses.

Rapino gets five minutes.

————–

Orrin Hatch to speak first– this will be a key sign of how deep the Republicans will be in LN’s pocket. He’s babbling about football now. He rambles on a bit… sounds suspicious of the merger but oesn’t show his hand.

———–

Rapino and Azoff are about to talk.

Apropos of nothing, I just thought about how Azoff said last week the merger would make for a “more level playing field.” I guess he meant “level” in the Carthanginan sense.

—————

Kohl is bashing them hard: “The burden will be on TM& LN”

Schumer is up next. He thanks Kohl. He says he made it clear to Azoff and Rapino in his office that morning he was against the merger.

TM took advantage of its reselling operation to charges many times the tickets’ value, he said. It’s more about “money-making rather than malfunction.” He wants specific answer as to how it happened. He says he doesn’t think the company should be in that business at all.

———–

Herbert Kohl, senator from Wisconsin, is speaking.

Great facts:

LM: Owns or operates 140 venues, 30 music festivals, 305 large arenas; plus deals with U2, Madonna, Jonas Bros.

TM: “nation’s dominant ticket seller”: 280 million tickets, $8.3 billion in ticket sales last year… 77 of the 100 largest venues.

Front Line: 200 artists

Kohl: “One company with a stranglehold on all aspects of the concert business.”

———

It’s underway.

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They are scheduled to start at 2:30 EST; the live webcast stream seems to be working.

Jim DeRogatis has some good information here.

The witnesses listed include Irving Azoff and Michael Rapino, who have yet-be-be-clarified positions at the top of the new company; Jerry Mickelson, head of Jam Productions, an independent outfit that has been fighting off Live Nation and its predecessors for more than a decade; David A. Balto, a senior fellow at the Center for American Progress in DC; and the just-added Seth Hurwitz, one of the owners of DC’s legendary 9:30 Club. I assume the last three will all speak against the merger, but I don’t know for sure about Hurwitz.