Live Nation Entertainment blamed bots for the Taylor Swift ticket fiasco. Is it a legitimate explanation or just an excuse? by Cody Mello-Klein January 25, 2023 Share Facebook LinkedIn Twitter When Ticketmaster opened up presale tickets for Taylor Swift’s first tour since 2018, fans were quickly overwhelmed by bots swooping into scoop up tickets. But Northeastern University cybersecurity and antitrust experts say Ticketmaster should have been better equipped to handle the issue. AP Photo by: Rolf Vennenbernd Music industry monolith Live Nation Entertainment, owner of Ticketmaster, faced a united front of political opposition during a Senate Judiciary Hearing this week, as Democrats and Republicans criticized the company for its mishandling of Taylor Swift ticket sales last fall. During the three-hour hearing, senators from across the political spectrum grilled the company’s president and CFO, Joe Berchtold, questioning the company’s bullish business practices and monopolization of the music industry. In some cases, senators even called for the dissolution of the 2010 merger between Live Nation and Ticketmaster. “This is all the definition of monopoly,” said Sen. Amy Klobuchar, a Democrat from Minnesota, during the hearing. “Live Nation is so powerful that it doesn’t even need to exert pressure, it doesn’t need to threaten, because people just fall in line.” Berchtold acknowledged Ticketmaster’s botched presale of tickets for Taylor Swift’s “Eras Tour,” the artist’s first tour since 2018. Fans who had waited for hours in a digital queue were frustrated when they faced either exorbitant fees or, more commonly, couldn’t even get tickets at all. Even Swifties in Ticketmaster’s Verified Fan program, who were able to get in early for the presale, were out of luck. In his attempts to explain what went wrong, Berchtold said Ticketmaster has been the target of a large-scale cyberattack by bots. These programs carry out automated action online in a way that appears human-like and are often deployed by scalpers to crowd out real fans, scooping up large amounts of tickets and reselling them for well above fair market price. William Robertson, an associate professor of computer science at Northeastern University, says that Berchtold’s characterization of the Taylor Swift debacle is fair. Bots are a prevalent issue in ticket sales, and a bot invasion was clearly part of the problem in this case. But that’s not the whole story, he says. “Ticketmaster’s statement seems to imply that this cyberattack is somehow unexpected when in fact this attack is and has been a known, core threat to their business for a long time now,” Robertson told Northeastern Global News. “The only aspect of this incident that is perhaps unprecedented is the scale of the attack.” The most common defense against bots is a CAPTCHA, a test that determines whether a web user is a human or a program. But scalpers have become very good at fooling these tests, Robertson says, to the point where there is an entire segment of the cybersecurity industry focused on this very issue. Robertson admits it’s “unreasonable to expect that Ticketmaster can stop all bot attacks.” However, the brutal efficiency with which bots penetrated Ticketmaster’s system last November is indicative of a bigger issue that was the focus of this week’s hearing: the company’s monopoly on the concert industry and the merger that helped it secure that position in the first place. “It’s clear that they should be doing more and, without strong competition or regulatory action, it would seem they do not have enough incentive to invest in this part of their business,” Robertson says The concerns cited by Klobuchar and her fellow senators are not new. They date back to the 1990s, when Pearl Jam tried and failed to stand up to Ticketmaster. And the same arguments were brought up during the U.S. Department of Justice’s 2010 settlement that allowed the merger to go through. John Kwoka, Neal F. Finnegan distinguished professor of economics at Northeastern, says even at the time, there was a strong case for an antitrust challenge to the $889 million deal. Kwoka served as an economic consultant for a working group established by a group of state governments that conducted their own parallel investigation of the 2010 merger that formed Live Nation Entertainment. “Most of us who read the consent order, which was a piece of paper that represented that agreement, objected because it seemed unenforceable, and I think history has proven that to be true,” Kwoka says. “The very things that the consent order was supposed to prevent––conditioning sale of one thing and the purchase of another, retaliation against those who did not choose to use Ticketmaster’s services––all of those happened right away.” And in the 13 years since the merger, those behaviors haven’t stopped. From venue management to ticket services, Live Nation Entertainment is now a dominant player in most stages of live music production. The bot attack in the Taylor Swift case highlights how that level of dominance is still problematic, Kwoka says. “The question of whether it rises to a legally actionable failure on Ticketmaster’s part is something yet to be determined, but my point is that leaving a project like this in the hands of the same company that’s dominated the business for 30 years is eventually a prescription for trouble,” Kwoka says. “It faces no pressure from a new competitor or a small competitor to improve its systems and stay ahead of the attacks.” Whether the furor of Swifties and the interest of the Department of Justice can help change that is another story. During the hearing, Sen. Richard Blumenthal, a Democrat from Connecticut, said “unwinding the merger ought to be on the table” if the Department of Justice can prove Live Nation Entertainment has violated its consent decree. Although it would be a radical move, Kwoka says it’s not without precedent. In 1984, the government forced AT&T to break up into eight smaller companies––although they have since come back under the AT&T banner. A lot of it comes down to how the company is structured and the priorities of those in power. Live Nation Entertainment has relatively discrete operations between promotion, ticketing and venues, which Kwoka argues would make it easier to dissolve the merger. More importantly, Kwoka says Merrick Garland, the U.S. attorney general, and Lina Khan, chair of the Federal Trade Commission, are trying to usher in “a new era in competition policy.” Kwoka, who currently serves as Khan’s chief economic adviser, says the Taylor Swift case is hitting at the perfect time, when the U.S. is primed to take action on antitrust policy. “It’s a historic moment,” Kwoka says. “It’s not been true for decades that both agencies have been headed by people equally interested or determined to take a hard look at some of these issues.” Cody Mello-Klein is a Northeastern Global News reporter. Email him at email@example.com. Follow him on Twitter @Proelectioneer.