Melbourne has a number of iconic sports venues which host international and domestic sporting events as well as concerts for leading entertainers such as Taylor Swift, Ed Sheeran and Adele. Event promoters (EP) who wish to hold an event at these iconic venues enter into arrangements with the venue operator (VO). The VO has a separate arrangement with a ticketing service provider (TSP) who is responsible for ticket sales to the public. VOs pay the TSPs a fixed administration fee for selling tickets to events at their venues (which the VO passes on to the EP). Ticket buyers separately pay a booking fee to the TSP. TicketSeller is a relatively small company with only 40 staff but it is the leading TSP in Melbourne. It sells approximately 50% of tickets to all events in Melbourne. Most of its ticket sales occur online via its website. TicketSeller’s website is regarded as the ‘go to’ website for customers wishing to buy tickets to upcoming events. TicketSeller also has ticket outlets strategically located in shopping centres, through which it sells approximately 15% of its total ticket sales. Less than 1% of its sales take place at the TicketSeller’s sales outlets located at the venues. In an attempt to streamline its sales processes and offer more certainty for ticket buyers, TicketSeller has insisted that its contracts with the VOs for the top 5 venues in Melbourne include an exclusivity provision, which requires tickets for all events to be held at those top 5 venues to be sold through TicketSeller. In return for agreeing to this provision, the VOs have insisted on a term which allows them to terminate the contract on 6 months’ notice. Following the insertion of this exclusivity provision into the VO contracts, TicketSeller raised its booking fees to ticket buyers by 50% to $3.00 which is higher than that of its only competitor, TicketSolutions. TicketSolutions is a global TSP based in California. It has recently established an Australian subsidiary that has quickly acquired 8% of the market in Melbourne. Elton John will soon be touring Australia and will be playing at the top 5 venues in Melbourne. However, ticket sales have been low and his EP has complained to the relevant VOs that tickets should be able to be sold through other online and in-store TSPs. (a) Provide advice to Elton John on whether the actions of Ticketseller could be successfully challenged under the current version of section 46 of the Competition and Consumer Act. (b) How would your advice have differed if the conduct of Ticketseller had taken place prior to the amendments to section 46 recommended by the Harper Review.
Melbourne has a number of iconic sports venues which host international and domestic sporting events as well as concerts for leading entertainers such as Taylor Swift, Ed Sheeran and Adele. Event promoters (EP) who wish to hold an event at these iconic venues enter into arrangements with the venue operator (VO). The VO has a separate arrangement with a ticketing service provider (TSP) who is responsible for ticket sales to the public. VOs pay the TSPs a fixed administration fee for selling tickets to events at their venues (which the VO passes on to the EP). Ticket buyers separately pay a booking fee to the TSP.
TicketSeller is a relatively small company with only 40 staff but it is the leading TSP in Melbourne. It sells approximately 50% of tickets to all events in Melbourne. Most of its ticket sales occur online via its website. TicketSeller’s website is regarded as the ‘go to’ website for customers wishing to buy tickets to upcoming events. TicketSeller also has ticket outlets strategically located in shopping centres, through which it sells approximately 15% of its total ticket sales. Less than 1% of its sales take place at the TicketSeller’s sales outlets located at the venues.
In an attempt to streamline its sales processes and offer more certainty for ticket buyers, TicketSeller has insisted that its contracts with the VOs for the top 5 venues in Melbourne include an exclusivity provision, which requires tickets for all events to be held at those top 5 venues to be sold through TicketSeller. In return for agreeing to this provision, the VOs have insisted on a term which allows them to terminate the contract on 6 months’ notice.
Following the insertion of this exclusivity provision into the VO contracts, TicketSeller raised its booking fees to ticket buyers by 50% to $3.00 which is higher than that of its only competitor, TicketSolutions. TicketSolutions is a global TSP based in California. It has recently established an Australian subsidiary that has quickly acquired 8% of the market in Melbourne.
Elton John will soon be touring Australia and will be playing at the top 5 venues in Melbourne. However, ticket sales have been low and his EP has complained to the relevant VOs that tickets should be able to be sold through other online and in-store TSPs.
(a) Provide advice to Elton John on whether the actions of Ticketseller could be successfully challenged under the current version of section 46 of the Competition and Consumer Act.
(b) How would your advice have differed if the conduct of Ticketseller had taken place prior to the amendments to section 46 recommended by the Harper Review.
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