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Lawmakers ask Department of Justice to investigate Warner Bros. Discovery merger

Four Democratic lawmakers have written to the Department of Justice to investigate Warner Bros. Discovery and launch an inquiry into alleged anti-competitive behavior. Democratic representatives Elizabeth Warren, Pramila Jayapal, David Cicilline and Joaquin Castro wrote that the merged company has harmed workers and reduced consumer choice. Warner Bros. Discovery was formed after WarnerMedia merged with Discovery Inc. in April 2022.
“We respectfully urge the Justice Department to investigate the state of competition in affected labor and consumer markets following consummation of this merger, which appears to have enabled Warner Bros. Discovery (WBD) to adopt potentially anticompetitive practices that reduce consumer choice and harm workers in affected labor markets,” the lawmakers wrote in the letter.
Warner Bros. Discovery did not respond to TechCrunch’s request for comment.
The lawmakers argue that Warner Bros. Discovery’s new ownership is “hollowing out an iconic American studio.” The letter outlines that many projects were cancelled by Warner Bros. Discovery not long after the merger, including “Batgirl,” which was canceled even though filming for the movie had already been completed. The letter also refers to the cancellation of popular shows like “Gordita Chronicles” and “The Time Traveler’s Wife.”
In addition, the lawmakers note that Primetime Emmy Award winner J. J. Abrams is now shopping elsewhere for a home for his TV show “Demimonde” which was initially picked up by HBO and then canceled before production began on the project.
The letter notes that consumers will likely never be able to watch shows purchased then cancelled by the company, and that Warner Bros. Discovery’s conduct amounts to a “catch and kill” practice that limits consumer choice.
The lawmakers also outline that the company’s actions are leaving workers with fewer choices for employment and advancement.
“Shortly after the merger was finalized, WBD began realizing a number of cost synergies that were used to justify the merger in the first place—including cuts to hundreds of jobs for working people,” the letter reads. “First, WBD cut the streaming platform CNN+. The CNN+ cut affected about 350 employees, and four months later, CNN laid off an additional 400 employees. WBD also enacted 100 layoffs in its company’s ad sales department as another cost-cutting effort related to the merger. In total, the aforementioned cuts affected thousands of people. Notably, WBD still has $3.5 billion in planned cuts—which does not bode well for workers.”
The letter ends by asking the Department of Justice to take another look at the transaction and take into consideration the actions that the company has taken since the merger was finalized a year ago. The lawmakers write that they hope the guidelines for the merger are updated to ensure they reflect the needs of workers, consumers and content creators in the media and entertainment industry.
The letter comes as Warner Bros. Discovery is expected to hold a press event sometime this week regarding its new direct-to-consumer streaming plan.

Warner Bros. Discovery continues to lose money despite success of ‘The Last of Us’ and ‘Hogwarts Legacy’

Lawmakers ask Department of Justice to investigate Warner Bros. Discovery merger by Aisha Malik originally published on TechCrunch
Lawmakers ask Department of Justice to investigate Warner Bros. Discovery merger

Google gets antitrust attention in Spain over news licensing

Google can add another antitrust investigation to its stack. This one has been opened by Spain’s competition authority, the CNMC, which said today it’s concerned about possible anti-competitive practices related to the licensing of news content by local publishers.
In a press release it said it is investigating “a series of practices that could involve an abuse of Google’s dominant position vis-à-vis the publishers of press publications and news agencies established in Spain” [NB: We’ve translated the text from Spanish with machine translation].
“In particular, these practices would consist the possible imposition of unfair commercial conditions on the publishers of press publications and news agencies established in Spain for the exploitation of their content protected by intellectual property rights,” it also wrote. “On the other hand, the investigated behaviors would also include practices that would constitute acts of unfair competition that could distort free competition and affect the public interest.”
The competition authority said it is acting following a complaint by the Spanish Center for Reprographic Rights (aka, Centro Español de Derechos Reprográficos or CEDRO).
We’ve reached out to all concerned.
News licensing is an area where Google has faced severe sanction in Europe already. Back in July 2021, France’s antitrust authority fined the tech giant over half a billion dollars for breaching an order to negotiate copyright fees with news publishers for reuse of their content. That followed the EU a copyright reform, agreed back in 2019, that extended IP to snippets of news content — requiring platforms like Google to negotiate with publishers.

Google fined $592M in France for breaching antitrust order to negotiate copyright fees for news snippets

Spain transposed the EU reform into its national law in November 2021, paving the way for a return of Google News to the country.
Google’s news aggregation service had closed in Spain in 2014 after the country passed a law that aimed to force Google to pay a collective licensing fee for the news snippets. The EU copyright reform replaced the prior fee regime with a requirement to negotiate with individual publishers — and Google News duly reopened in Spain in June 2022.
At the same time, the company also announced it would launch its News Showcase product in the country. Google’s News Showcase product was spun up by the tech giant in fall 2020 as lawmakers in Europe and elsewhere were zeroing in on making it pay for news content reuse — creating a licensing vehicle it could use in the looming, inexorable negotiations with publishers.
It’s not immediately clear whether the Spanish probe will focus on Google’s News Showcase licensing arrangements or on copyright fees talks — or both.
While it remains to be seen what Spain’s investigation of Google’s news licensing practices will finally determine — the authority has up to 18 months to conduct the probe — it said its preliminary information-gathering phase found “indications of possible infringement”.
Germany’s antitrust authority, meanwhile, has already pushed back over Mountain View’s practices in this area after starting to scrutinize its news-related fine print in summer 2021. The regulatory attention on Google from the German FCO — which is currently armed with beefier powers to tackle Big Tech than other European countries (thanks to a 2021 update to competition law squarely targeted at digital giants) — has led to Google offering a series of concessions over how it operates News Showcase locally, including an offer not to include the showcasing of licensed content in general search results (which is one trigger for antitrust concerns).
The News Showcase product provides the prospect of raised visibility for participating publishers, since the offer is for Google to feature participants’ content to users across a number of touchpoints. However that could create a disadvantage for publishers who don’t pay Google (i.e. if it leads to their content being less visible in Google’s general Internet search, given its continued dominance of the Internet search and content discovery market).
Google has also sought to co-mingle negotiations with publishers over News Showcase with what are, under the pan-EU reform, legally required talks over copyright fees — something France’s watchdog slapped down in its hefty enforcement in mid 2021.

Google offers not to put News Showcase into search results in Germany as antitrust probe rolls on

Google users not given sufficient choice over its data processing, says German antitrust watchdog

Google gets antitrust attention in Spain over news licensing by Natasha Lomas originally published on TechCrunch
Google gets antitrust attention in Spain over news licensing

Google rolls out tests that block news content for some users in Canada

Google has launched tests that block access to news content for some users in Canada in response to the Canadian government’s online news bill. Bill C-18, or the Online News Act, would require platforms like Facebook and Google to negotiate deals that would pay news publishers for their content. The bill is currently before the Canadian Senate for debate.
The company told TechCrunch that the tests impact “a small percentage” of Canadian users. The tests limit the visibility of Canadian and international news, and affect all types of news content.
“We’re briefly testing potential product responses to Bill C-18 that impact a very small percentage of Canadian users,” a spokesperson for the company told TechCrunch in an email. We run thousands of tests each year to assess any potential changes to Search. We’ve been fully transparent about our concern that C-18 is overly broad and, if unchanged, could impact products Canadians use and rely on every day. We remain committed to supporting a sustainable future for news in Canada and offering solutions that fix Bill C-18.”
Canadian Heritage Minister Pablo Rodriguez said on Twitter that Canadians won’t be intimidated by the tests and that tech giants need to be more transparent and accountable.

It’s disappointing to hear that Google is trying to block access to news sites. Canadians won’t be intimidated. At the end of the day, all we’re asking the tech giants to do is compensate journalists when they use their work. (1/2) https://t.co/11iRMA9jpL
— Pablo Rodriguez (@pablorodriguez) February 23, 2023

“It’s disappointing to hear that Google is trying to block access to news sites,” Rodriguez said in a tweet. “Canadians won’t be intimidated. At the end of the day, all we’re asking the tech giants to do is compensate journalists when they use their work. That’s why we introduced the Online News Act. Tech giants need to be more transparent and accountable to Canadians.”
Last year, Facebook threatened to block the sharing of Canadian news content unless the government amended legislation that would force digital platforms to pay news publishers. In 2021, Facebook briefly restricted users in Australia from sharing or viewing news links on the platform due to similar legislation. Google is now borrowing from the Meta-owned company’s playbook.
The move from Google doesn’t mark the first time that the company has opposed Canadian legislation. Last year, Google expressed concerns with Bill C-11, or the Online Streaming Act. The bill would force platforms like Google-owned YouTube to more prominently feature Canadian content. Google argued that the bill would negatively affect creators and viewers, and limit content discoverability. The Canadian Senate recently passed the bill with dozens of amendments, and it will be reviewed by the House of Commons.
A few months ago, U.S. Trade Representative Katherine Tai issued a statement noting that the online news and streaming bills discriminate against American businesses. The U.S. government has also raised concerns about the trade implications of the bills.
Google rolls out tests that block news content for some users in Canada by Aisha Malik originally published on TechCrunch
Google rolls out tests that block news content for some users in Canada

Senate questions Live Nation president amid Taylor Swift ticketing debacle

“May I suggest respectfully that Ticketmaster ought to look in the mirror and say, ‘I’m the problem, it’s me,’” Senator Richard Blumenthal (D-CT) said on the Senate floor Tuesday, referencing Taylor Swift’s latest hit “Anti-Hero.” In a hearing on consumer protection and competition in live entertainment, senators grilled Live Nation CFO and president Joe Berchtold over concerns that the company, which bought Ticketmaster in 2010, may be a monopoly.
In November, the “verified fan” presale for Swift’s highly anticipated Eras tour went horribly wrong. In an unprecedented move, Ticketmaster halted sales due to overwhelming demand, stating that the site experienced 3.5 billion system requests, or more than four times its previous peak, due to bot attacks. A month later, Mexican regulators fined Ticketmaster when thousands of fans were turned away from a Bad Bunny concert, despite holding tickets purchased on Ticketmaster (regulators said the company oversold tickets, but Ticketmaster said these were fake tickets).
After years of paying hidden fees and losing tickets to scalpers, fans and regulators alike have had enough. Making yet another of many Swift references, Senator Amy Klobuchar (D-MN) said that music and sports fans now understand the risks of corporate consolidation “all too well.” And as Federal Trade Commission chair Lina Khan said at the time of the Swift ticketing fiasco, the incident “converted more Gen Z’ers into antimonopolists overnight than anything I could have done.”
When the government investigated the merger of Ticketmaster and Live Nation over twelve years ago, the Justice Department reported that the combined company would control 80% of major concert venues. When questioned under oath on Tuesday, Berchtold said he believes the company actually controls around 50% to 60% of that market, due to the rise of secondary resale markets on sites like SeatGeek (whose founder and CEO, Jack Groetzinger, testified at the hearing as well). Still, Ticketmaster sells tickets for 80 of the top 100 arenas in the country, while Live Nation can sometimes operate as the promoter, owner and operator of that same venue.
The arrangement is bad for fans, who might watch as their favorite artist sells out an arena show in seconds, only for thousands of bot-purchased tickets to be immediately reposted for double the price. But it also harms the musicians.
Testifying before the Senate, independent musician Clyde Lawrence said, “In a world where the promoter and the venue are not affiliated with each other, we can trust that the promoter will look to get the best deal from the venue; however, in this case, the promoter and the venue are part of the same corporate entity, so the line items are essentially Live Nation negotiating to pay itself.” Lawrence added that artists get no cut of ticketing fees, coat checks, parking passes or bar tabs, while Live Nation takes 20% of their revenue from merch sales. If he plays a show where tickets cost $42, including fees, Lawrence said his band would get $12. After putting half of that toward touring costs, the band receives $6 per ticket in profit, which is split up among all of its members, pretax.
The Justice Department had approved this merger in 2010 with the condition of a consent decree, which was intended to prevent Live Nation and Ticketmaster from acting too much like a monopoly. But in 2019, Justice officials alleged that the company violated the agreement, since Live Nation had pressured venues to sign contracts with Ticketmaster. As a result, the decree — which was set to expire that year — was extended to remain in effect until 2025, including some modifications.
Now, in light of the Swift snafu, the department is investigating Live Nation again.
“If the Department of Justice establishes facts that involve monopolistic and predatory abuses, there ought to be structural remedies, such as breaking up the company,” Blumenthal said at Tuesday’s hearing. “We’ll see what the Department of Justice finds.”
Some senators proposed potential solutions to the problem.
Passed under the Obama administration in 2016, the Better Online Ticket Sales Act (aptly named, the BOTS Act) gives the FTC license to crack down on bot-driven ticket resale firms. Senator Blumenthal and Senator Marsha Blackburn (R-TN) argued that, in the same vein, the FTC needs to pressure Live Nation to figure out its bot problem.
“There ought to be people you can get some good advice from, because our critical infrastructure in this country — whether it is utilities, electric, water, power, banking services, credit card processors, payment processors, healthcare companies — you know what, they get bot attacks every single day, by the thousands and thousands, and they have figured it out but you guys haven’t,” Senator Blackburn said.
The BOTS Act has only been enforced one time since 2016, when the FTC charged three ticket brokers with over $31 million in penalties in 2021.
“We have a limited level of power on something that hasn’t been consistently enforced,” Berchtold testified.
Senator Blumenthal retorted, “You have unlimited power to go to court.”
Senator John Kennedy (R-LA) suggested that Live Nation make tickets nontransferable in order to prevent bot resales. The witnesses were quiet for a moment, and Kennedy said, sarcastically, “Don’t all jump in at once.” The proposal might make simple conveniences difficult, like buying two tickets and sending one to a friend, or selling a ticket if you get sick before a show; plus, it could encourage sales of fraudulent tickets. Groetzinger, who operates a major resale site, said he would not support such a policy; Berchtold said he would.
The committee’s path forward to hold Live Nation accountable is unclear, but the Department of Justice’s investigation of Live Nation is ongoing.

Ticketmaster faces antitrust scrutiny after Taylor Swift ticket chaos

Mexican regulators are fining Ticketmaster after Bad Bunny concert fiasco

Senate questions Live Nation president amid Taylor Swift ticketing debacle by Amanda Silberling originally published on TechCrunch
Senate questions Live Nation president amid Taylor Swift ticketing debacle

Ticketmaster faces antitrust scrutiny after Taylor Swift ticket chaos

Ticketmaster is facing more scrutiny from politicians after its chaotic presales for tickets to Taylor Swift’s tour. Tennessee attorney general Jonathan Skrmetti said he is looking into whether Ticketmaster violated consumers’ rights and antitrust regulations. Skrmetti is the latest politician who has called attention to Ticketmaster and Live Nation’s hold on the ticketing market.
This comes as Ticketmaster cancelled its public sales for Swift’s tour, called Eras. In a tweet, Ticketmaster said the cancellation was due to “extraordinarily high demands on ticketing systems and insufficient remaining ticket inventory to meet that demand.”
The public sale would have been for tickets left over from the site’s troubled presales, which started on Tuesday for members of its Verified Fan program. Many fans experienced technical glitches and hours-long wait times, with many ultimately unable to buy a ticket.
According to The New York Times, Ticketmaster said in a now-deleted post that 3.5 million people registered for the Verified Fan program. Around 1.5 million were given a special access code, and the rest were put on a waiting list. “Never before has a Verified Fan on sale sparked so much attention—or uninvited volume,” Ticketmaster said.
Skrmetti said he had received complaints from fans who tried to purchase tickets for Eras. In a tweet on Thursday, the attorney general said that other state attorney generals are also looking into the matter: “Ticketmaster’s decision to cancel sales underscores the important need for accountability. Fans deserve a fair chance to buy a ticket. I’m encouraged by other state AGs who are taking this issue serious as well.”
The Washington Post reports that Skrmetti said Ticketmaster should have been better prepared for the high demand and questioned whether “because they have such a dominant market position, they felt like they didn’t need to worry about that.”
In another tweet before the sale was canceled, the attorney general’s office said Skrmetti “is concerned about consumer complaints related to @Ticketmaster’s pre-sale of @taylorswift13 concert tickets. He and his Consumer Protection team will use every available tool to ensure that no consumer protection laws were violated.”
TechCrunch has contacted Ticketmaster and Skrmetti’s office for comment.
Eras is Swift’s first tour in four years and comes after the release of her new album “Midnights.”
Other politicians have raised concerns over the combined company of Ticketmaster and Live Nation, which merged in 2010, including Representative Alexandria Ocasio-Cortez, Representative David N. Cicilline and Representative Bill Pascrell, Jr.
Representative Ocasio-Cortez said in a tweet on Tuesday that “Ticketmaster is a monopoly, its merger with LiveNation should never have been approved, and they needed to be reigned in. Break them up.”
Representative Cicilline tweeted on Wednesday that Ticketmaster’s “excessive wait times and fees are completely unacceptable, as seen with today’s @taylorswift13 tickets, and are a symptom of a larger problem. It’s no secret that Live Nation-Ticketmaster is an unchecked monopoly.”
And Representative Pascrell, Jr., who was among the millions of fans put on a waitlist for Swift tickets, tweeted “The Ticketmaster-Live Nation monopoly should never have been allowed to merge and must be broken up.”
Consumers are also pushing for a breakup of Ticketmaster and Live Nation. An alliance of consumer rights groups, including antitrust nonprofit American Economic Liberties Project, launched a campaign last month called Break Up Ticketmaster, saying that Ticketmaster’s “market power over live events is ripping off sports and music fans and undermining the vibrancy and independence of the music industry.”
Ticketmaster faces antitrust scrutiny after Taylor Swift ticket chaos by Catherine Shu originally published on TechCrunch
Ticketmaster faces antitrust scrutiny after Taylor Swift ticket chaos