February 10 th , 2009

1. February 10th, 2009 Ticketmaster Live Nation

2. The Players • Ticketmaster • Largest primary ticketing provider in the U.S. (80%) • Host, Paciolian, Frontline Management • Live Nation • Largest concert promoter in the U.S.

3. Merger Case 11.5 months long 250 interviews 2.5 million documents 12 CID’s to merging parties and third parties

4. Horizontal & Vertical Issues • Horizontal • Ticketmaster’s contract with Live Nation ends in Dec 31st, 2008 • Live Nation does not renew the contract for primary ticketing with Ticketmaster • Dec 2008, Live nation purchases European CTS software and enters the market for primary ticket sales • Ticketmaster profits fell 78% in first quarter • Feb 10th, 2009 Live Nation agrees to merge with Ticketmaster Vertical • Vertical • Control over all aspects of the live entertainment industry

5. Market Definition Product Level: the sale of primary ticketing services to major concert venues Geographic Level: venues with the U.S.

6. Market Concentration Ticketmaster dominated primary ticketing for the last 20 years Other players in the market: Tickets.com, New Era Tickets, and Front Gate Tickets All rivals have less than 4% share of the market

7. Pre-Live Nation Entry

8. Post-LiveNationEntry

9. HHI Market for primary ticketing to major concert venues is highly concentrated Pre-Merger HHI: 4,710 Post-Merger HHI: 6,900 Post-Merger increase of 2,190 points

10. Theories of Harm • Major concert venues most affected • Classic market power • Lessens competition in market for primary ticket sales as Live Nation was beginning to be only viable competitor • Lessens incentive for innovation • Exclusionary market power • High barriers to entry • Merged firms potential ability to bundle all aspects of concert going experience and exclude competitors

11. Efficiencies • Defendant argued for: • Efficiencies created by vertical integration • Price will pass to the consumer • Plaintiff argued for: • U.S. does not fully credit this claim • Same efficiencies can be achieved without the merger

12. Entry • Ticketmaster has dominated the market for over two decades • Existing ticketing companies do not have the qualities required to compete in the market. • New entry is costly and time-consuming • A substantial amount of money and over two years would be required to develop similar qualities to Live Nation Entertainment • Not likely to occur in a timely or sufficient basis on a scale that would raise competition

13. Final Judgment • Structural remedies • AEG’s entry to primary ticket sales market • Ticketmaster Host Platform for 5 years with royalties to Ticketmaster • Option to license their own copy of host for a fee • Divestiture of Paciolian to Comcast-Spectator • Behavioral remedies • No exclusionary conduct • 30 day notification for new aquisitions

14. Opinions/Conclusions Live Nation was beginning to compete when merger occurred Same vertical integration efficiencies could be achieved without merging as they were both beginning to verticaly integrate anyway Entry will be too difficult post-merger