From Broadway Syndicates to Ticketmaster: New Book Traces a Century of Live Entertainment Market Power

On August 31, 1896, six of the most powerful men in American theater sat down for lunch at New York’s Holland House Hotel and signed an agreement that would reshape the live entertainment business.

Abraham Lincoln Erlanger, Marc Klaw, Charles Frohman, Al Hayman, Sam Nixon and Fred Zimmerman brought together their theater holdings and booking operations as the American Theatrical Syndicate, agreeing to centralize bookings and pool profits from a growing national network of venues.

Exactly 130 years later, antitrust scholar Spencer Weber Waller sees that meeting as the beginning of a recurring story about who controls the gateways between performers and audiences — one he argues now runs directly through Live Nation and Ticketmaster.

Waller, the Justice John Paul Stevens Chair in Competition Law at Loyola University Chicago, explores that history in his forthcoming book, “Power and Greed: Monopolies, Mergers, and Cartels on the American Stage.” The book traces nearly a century of cartels and monopolies in theater and vaudeville before turning to contemporary competition concerns on Broadway and in the concert industry.

Speaking with TicketNews ahead of the book’s October 15 publication, Waller said the technology and individual companies have changed dramatically since the Gilded Age. What has proved remarkably persistent, he argues, is the economic importance of controlling the bottleneck that artists, producers or venues need to reach their audiences.

“If you can figure out where the bottleneck is and you control that, you don’t have to own all the theaters,” Waller said.

Control the Bottleneck, Control the Tour

In the late 19th century, that bottleneck was theater booking.

The expansion of the railroad system had transformed theatrical touring into a national business. Producers could make considerably more money by taking successful New York productions on lengthy tours, but doing so required assembling efficient routes through a patchwork of large cities and smaller markets.

The Syndicate offered a solution. Its booking network could string together theaters from market to market, cutting costly railroad jumps and providing both producers and venue operators with more predictable schedules.

The problem came as the network became increasingly difficult to avoid.

At its height, Waller recounts, the Syndicate controlled booking across a vast network of theaters through a combination of ownership, leases and exclusive booking arrangements. Producers working within the system gained access to efficient routes. Those who resisted could find themselves struggling to piece together viable tours through inferior venues and inefficient travel schedules.

Waller said the underlying economics remain recognizable today.

Live entertainment carries high fixed costs with highly variable revenues, while successful national tours depend on a network of venues and services. That creates powerful incentives to reduce risk — but also opportunities for whoever controls an essential piece of the network to gain leverage over the rest.

“It’s not all mustache-twirling Gilded Age villains,” Waller told TicketNews. “These are industries that have relatively high fixed costs … and variable revenues.”

The history gets more complicated with the rise of the Shubert brothers.

Initially small theater operators in upstate New York, the Shuberts were themselves customers of the Syndicate. When relations deteriorated and access to Syndicate theaters became difficult, they responded by buying, leasing and building venues of their own.

They eventually built a genuine competing network and broke the Syndicate’s grip. Then the challenger became the gatekeeper.

When the Upstart Becomes the Monopoly

Once the Shuberts overtook their former rival, Waller writes, they increasingly relied on many of the same tools they had once fought against: exclusive booking, control of theater routes and the integration of production, booking and presentation.

By the 1930s, the Shubert organization had become the dominant national theatrical operation, controlling Broadway theaters as well as the United Booking Office that connected touring producers to venues around the country.

That history is important to Waller because it complicates the idea that introducing a challenger is necessarily enough to create lasting competition.

The Justice Department finally sued to break up the Shubert organization in 1950, alleging that the company used its combined power in production, booking and theater ownership to compel producers to use its booking system, exclude competing bookers and favor its own productions.

After a Supreme Court ruling allowed the antitrust case to proceed, a 1956 consent decree forced the Shuberts to divest their United Booking Office interest and dispose of theater holdings in several major markets. It also restricted the company’s involvement in ticket agencies where it operated theaters.

The breakup helped new and existing competitors expand. Jujamcyn acquired former Shubert properties, while the Nederlander organization grew beyond its regional base and became a major Broadway operator.

Waller argues that what followed was a substantially healthier competitive environment — and, not coincidentally in his view, a period of enormous artistic success.

“The best thing that ever happened to the theater industry, and it’s not perfect, but the best thing that ever happened was the Shuberts were broken up,” he said.

That history informs his view of the antitrust fight currently unfolding around Live Nation and Ticketmaster.

From Pearl Jam to Live Nation

Waller’s involvement with Ticketmaster predates the company’s 2010 merger with Live Nation by more than a decade.

He appeared on CNN as an antitrust expert during Pearl Jam’s 1994 fight with Ticketmaster, when the band attempted to build a tour outside Ticketmaster’s dominant network while keeping ticket prices and fees low.

Pearl Jam ultimately struggled to assemble a viable national tour without using Ticketmaster-affiliated venues and eventually returned to the platform.

For Waller, the episode echoes the practical difficulties independent theatrical producers faced generations earlier: competition can theoretically exist, but that matters considerably less if a competitor cannot assemble the network necessary to reach customers at scale.

Ticketmaster subsequently expanded and in 2010 merged with Live Nation, combining the dominant primary ticketing provider with what was already the country’s largest concert promoter and a major venue operator.

The Justice Department allowed the merger under a consent decree containing structural and behavioral restrictions, including provisions intended to prevent Live Nation from retaliating against venues choosing another ticketing company. DOJ returned to court in 2019, alleging Live Nation had repeatedly violated the decree, resulting in stronger anti-retaliation requirements, independent monitoring and financial penalties under an amended judgment entered in 2020.

That history makes the government’s decision this year to settle its latest monopolization case without separating Ticketmaster from Live Nation particularly difficult for Waller to accept.

“The Schubert case shows that the best remedy — not the only remedy, but the best remedy — is to break them up so they lack the incentive and the power to misbehave,” he said.

The Justice Department reached its latest settlement with Live Nation days after trial began in March. The proposed final judgment again leaves Live Nation and Ticketmaster under common ownership while creating new rules around ticketing exclusivity, third-party primary ticket distribution, amphitheater access and other company practices. Live Nation agreed to the settlement without admitting wrongdoing.

Most of the state attorneys general involved in the case rejected the federal agreement and continued to trial. On April 15, a jury found Live Nation and Ticketmaster liable on the antitrust claims that remained, including findings that Ticketmaster unlawfully maintained monopoly power in primary ticketing markets and that Live Nation maintained monopoly power in the market for large amphitheaters used by artists.

The states are now seeking substantially stronger remedies, including divestiture of Ticketmaster and enough Live Nation amphitheaters to restore competition. Live Nation disputes the verdict and has asked U.S. District Judge Arun Subramanian to overturn it or grant a new trial.

Subramanian heard arguments on Live Nation’s post-trial motions on July 31 but had not ruled as of the end of August. The federal settlement separately remains subject to his review under the Tunney Act.

For Waller, that leaves the court with a rare opportunity to address the structure of the industry rather than impose another round of rules governing how an integrated company behaves.

“This is a company that’s proven to have market power,” Waller said. “The merger made it worse, and they made a series of promises that were supposed to make it better. They’ve never kept those promises. And enough is enough.”

Where Does Ticket Resale Fit?

Waller’s historical research also produces a less obvious parallel with the modern ticket business: fights over the secondary market are hardly new.

The book recounts theater owners and producers campaigning against independent ticket speculators more than a century ago, even as the Shuberts developed or acquired licensed brokerage operations of their own. Waller writes that strong demand for hit productions repeatedly created a market for tickets above their original box-office price despite repeated attempts to suppress it.

Asked by TicketNews how today’s independent resale marketplaces fit into his broader competition analysis, Waller was careful not to treat every form of resale as inherently beneficial.

“The answer is complicated,” he said.

But Waller noted that dominant companies in other industries have also historically tried to limit secondary markets for used or recycled goods because those alternatives can constrain the original supplier’s pricing power.

“I think a healthy, functioning, non-deceptive secondary market is generally pretty good for competition and consumers,” Waller said. “But it all depends.”

That does not resolve debates over deceptive ticket listings, bots or other resale practices. But it does suggest, in Waller’s view, that policymakers considering restrictions on independent resale should also account for the competitive role an alternative distribution channel can play when the primary market itself is concentrated.

The broader lesson of “Power and Greed” is not that Live Nation and Ticketmaster are identical to a theatrical cartel created in a Manhattan hotel dining room 130 years ago.

The technology is different. The companies are different. The legal environment is radically different.

The recurring issue, Waller argues, is what happens when control of enough critical pieces of a live entertainment network gives one organization the ability to determine how others reach the market.

“This has all happened before. It’s all going to happen again,” Waller said. “The technologies are different.”

“At the end of the day, it’s the structure of the industry that determines how competition works,” he added. “And if you get the structure right, you don’t have to worry about the behavior.”

“Power and Greed: Monopolies, Mergers, and Cartels on the American Stage” is scheduled for publication October 15 by Methuen Drama/Bloomsbury and is currently available for preorder.