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Federal Trade Commission Comes Under Scrutiny Following Taylor Swift Ticketing Disaster

Senators are requesting info from FTC chair Lina Khan on enforcement efforts against illegal bots after billions are said to have infiltrated the Eras Tour presale.

Just a week after Ticketmaster’s disastrous presale for Taylor Swift‘s The Eras Tour, Sens. Richard Blumenthal (D-CT) and Marsha Blackburn (R-TN) are asking the chair of the Federal Trade Commission (FTC) how the agency plans to combat bots in the online ticketing marketplace.

In a letter sent Monday (Nov. 28), Sens. Blumenthal and Blackburn — chair and ranking member of the Senate’s Subcommittee on Consumer Protection, Product Safety and Data Security, respectively — are requesting information from FTC chair Lina Khan about what steps the FTC is taking to enforce the 2016 law known as the Better Online Ticket Sales (BOTS) Act, which was designed to crack down on the kind of illegal bots that have plagued online ticket sales for recent tours by Swift and other major stars. Both Blackburn and Blumenthal were early sponsors and champions of the bill.

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That law, which “prohibits the circumvention of a security measure, access control system, or other technological control measure used online by a ticket issuer” and the sale of tickets knowingly obtained through those means, grants the FTC and state attorneys general the authority to enforce violations, according to the letter. But since the BOTS Act became law, Blumenthal and Blackburn claim the FTC has taken only a single enforcement action despite numerous incidents involving the use of bots in online ticket sales.

“Given the numerous high-profile incidents in the online ticket marketplace, it would be helpful to understand how the FTC intends to act to address such conduct going forward,” the letter reads.

Monday’s letter follows Ticketmaster’s earlier claim that the Swift debacle was caused in part by tens of millions of uninvited users and billions of bots crashing the Eras presale, forcing the company to shut down the tour’s final onsale after more than 90% of ticketing inventory was snapped up.

In the wake of the fiasco, politicians including Sen. Amy Klobuchar — chair of the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights — and Rep. Alexandria Ocasio-Cortez suggested Ticketmaster and its owner Live Nation represent a monopoly and cried out for accountability, with the latter directly calling for the companies, which merged in 2010, to be broken up. Last week, Klobuchar and her counterpart on the Senate Judiciary Subcommittee, Sen. Mike Lee (R-UT), jointly announced they would be holding a hearing to examine the effects of consolidation on the ticketing industry. Live Nation and Ticketmaster are also reportedly under investigation by the Justice Department over whether the companies represent an illegal monopoly, though that probe is said to have predated the Swift incident.

In addition to the Swift debacle, in the letter Blumenthal and Blackburn point to various other recent online ticketing mishaps involving bots, including tours for Bob Dylan, Blake Shelton, Bruce Springsteen and Adele.

“While bots may not be the only reason for these problems, which Congress is evaluating, fighting bots is an important step in reducing consumer costs in the online ticketing industry,” the senators continued. They point out that the infiltration of bots, among other factors, creates an unfair environment that prevents regular fans from purchasing tickets, forcing them to resort to secondary sites where tickets are often marked up dramatically. “Some reports have found secondary ticket sales ranging from $1,000 (Bruce Springsteen) to $40,000 (Adele),” the lawmakers added.

Though Swift may benefit from Blackburn’s interest in addressing the ticketing bots issue, the two have not exactly gotten along in the past. The pop star made a rare-at-the-time political statement in 2018, denouncing Blackburn for her conservative voting record and urging voters to choose her opponent in the Senate race that year. She later called the lawmaker “Trump in a wig.” Last year, Blackburn addressed the tiff in an interview, arguing Swift would be the “first victim” in a “socialistic government.” (Blackburn’s office declined to comment further on the bad blood between the women.)

In addition to asking whether the FTC has any “pending enforcement matters before it” with respect to the BOTS Act, Blumenthal and Blackburn are asking why only a single enforcement action has been taken to date; whether there are “obstacles preventing” the FTC from enforcing the law; and whether there are “other solutions that Congress needs to consider” to prevent bots from operating in the future.

You can read the full letter below.

Dear Chair Khan:

We write to ask for information about the steps the Federal Trade Commission (FTC) is taking to combat the use and operation of bots in the online ticket marketplace. As you know, the Better Online Ticket Sales, or BOTS Act, became law in 2016. This law prohibits the circumvention of a security measure, access control system, or other technological control measure used online by a ticket issuer. It also prohibits the selling or offering of an event ticket obtained through a circumvention violation if the seller participated in, had the ability to control, or should have known about the violation. The BOTS Act gives the FTC and state attorneys general the authority to enforce violations as unfair and deceptive practices.

Recently, several high profile incidents arose where consumers encountered serious difficulties purchasing tickets through online ticket vendors, including Ticketmaster and AXS. While bots may not be the only reason for these problems, which Congress is evaluating, fighting bots is an important step in reducing consumer costs in the online ticketing industry. For example, consumers reported trying to purchase tickets to see Bob Dylan at the Ryman Auditorium in Nashville, only to be told the tickets in their shopping cart no longer existed. Similarly, 22,000 fans preregistered to buy tickets for Blake Shelton, but only a few hundred actually got tickets. Finally, Ticketmaster/LiveNation pointed to online bots as a reason why fans could not get Taylor Swift concert tickets, leading the ticket seller to shut down sales to the general public.

While some consumers opt to purchase tickets on the secondary market, most fans cannot afford to pay thousands of dollars for a single concert ticket. Some reports have found secondary ticket sales ranging from $1,000 (Bruce Springsteen) to $40,000 (Adele).3 Preventing this type of consumer harm is exactly why Congress chose to enact the BOTS Act six years ago and why we both chose to sponsor that bill.

We understand that, in January 2021, the FTC took its first enforcement actions under the BOTS Act. However, given the numerous high-profile incidents in the online ticket marketplace, it would be helpful to understand how the FTC intends to act to address such conduct going forward. We request answers to the following, which may be provided in a confidential briefing if needed:

  1. Does the FTC have any pending enforcement matters before it with respect to the BOTS Act?
  2. Why has the FTC only undertaken a single enforcement action to date using its BOTS Act authority?
  3. Are there obstacles preventing the FTC from exercising its authority under the BOTS Act that Congress should be aware of?
  4. Are there other solutions that Congress needs to consider in conjunction with the BOTS Act?

We appreciate your timely attention to this issue.

Sincerely,

Marsha Blackburn
Ranking Member
Subcommittee on Consumer Protection, Product Safety, and Data Security

Richard Blumenthal
Chair
Subcommittee on Consumer Protection, Product Safety, and Data Security