Live Nation's Bid for a Mexican Concert Promoter Could Bring Big Changes to Region's Ticketing Biz

Soy Luna Live
El Universal/ZUMA Press

Soy Luna Live, one of OCESA’s top-grossing shows of the past year, according to Billboard Boxscore.

In late July, Live Nation announced that it intends to acquire a controlling stake in the Mexican concert promoter OCESA from Grupo Televisa and Corporacion Interamericana de Entretenimiento in a $445 million deal that could change the North American touring business.

Control over OCESA would strengthen Live Nation's lock on North America, giving it a touring map that stretches 5,500 miles, from the Mile One Centre in St. John's, Newfoundland, to the Estadio Beto Avila in Cancún, Mexico.

Now the deal needs approval from regulators in Mexico and Colombia where OCESA's South American headquarters are located. The U.S. Department of Justice's antitrust division has yet to block a Live Nation acquisition, however, and since Live Nation and OCESA have co-promoted concerts for a decade, the deal would change little in the short term.

The ticketing business in Mexico could undergo major changes, though, if Live Nation's Ticketmaster takes control of Ticketmaster Mexico, of which it now owns just one-third. (Ticketmaster Mexico has operated like a franchise since 1991, licensing its parent company's technology to the brands Venta de Boletos por Computadora and ETK Boletos.)

Mexico has become one of the strongest live-music markets in the world: The country's 129 million residents bought 37 million tickets from Ticketmaster Mexico in 2018, and venues like Auditorio Nacional in Mexico City frequently top Billboard Boxscore's venues chart. The OCESA transaction would position Ticketmaster for rapid growth in Mexico, especially when it comes to its data strategy. "Ticketmaster has a wealth of data on its customers, but as a licensee, Ticketmaster Mexico may not have that same flexibility to share data," says Gigi Johnson, founder of the Center for Music Innovation at the University of California, Los Angeles. "Having all of the data under the same hood would allow Ticketmaster to gain a massive competitive advantage fairly quickly."

What Ticketmaster sees as an advantage could be an issue for regulators, however. Live Nation's purchase would follow the close of a two-year antitrust inquiry by Mexico's Federal Competition Commission, which resulted in a settlement barring OCESA from forcing venues to exclusively license Ticketmaster software. (Ticketmaster can still pay advances in exchange for exclusivity.)

The Mexican settlement took effect toward the end of the term of the U.S. settlement that Live Nation made in 2010, when it merged with Ticketmaster -- which bars the company from withholding shows from venues that use other ticket vendors. It expires in July 2020, at a time when regulators, politicians and even presidential candidates are taking a greater interest in competition policy -- especially in the technology business. In July, Rep. Bill Pascrell, D-N.J., called for the breakup of Live Nation, testifying before the House Committee on Energy and Commerce that "they have sway over everything, including the peanuts you buy," and criticizing the 2010 consent decree as ineffective.

Ticketmaster now has a larger share of the ticketing market than it did 10 years ago, thanks to Live Nation's dominance of the concert pipeline and its acquisitions of independent promoters. So far, at least, other ticketing companies have had a hard time executing consistently at an arena-level scale. "Ticketmaster executives don't like to gloat when one of their competitors has problems -- it looks bad to regulators," says one high-level ticketing executive. "Instead they just shrug their shoulders and say something like, 'Ticketing is hard.'"

This article originally appeared in the Aug. 24 issue of Billboard.

Editor's note: This article has been updated to correct two mistatements. For the record, Live Nation does not need regulatory approval from U.S. officials. Secondly, the consent decree expires in July, not January as Billboard previously reported.