viagogo’s purchase of StubHub raises competition
concerns in the online secondary ticketing market in the UK, a CMA
investigation has found.
The Competition and Markets Authority (CMA) is concerned that the
loss of competition brought about by the merger could result in
customers who buy and resell tickets losing out as a result of
higher prices and fewer options.
viagogo purchased StubHub in February 2020. Both companies have a
significant presence in the UK’s secondary ticketing market.
Together, they have a combined market share of more than 80% and
are the number 1 and number 2 players respectively in the UK.
After completing its initial Phase 1 investigation, the CMA found
that viagogo and StubHub are close competitors in an already very
concentrated market with limited alternatives. It is particularly
concerned that the merger would raise the prices for customers,
including fans, who resell and buy secondary tickets to live
events.
As part of its investigation, the CMA undertook extensive market
testing and looked at evidence from a number of third-party
stakeholders including consumer groups, customers and
competitors. It also examined the companies’ internal documents.
The CMA is mindful of the heavy impact that the Coronavirus
(COVID-19) is currently having on the live events industry.
However, it anticipates viagogo and StubHub will remain important
competitors in the online secondary ticketing market in the
longer term. The CMA has seen no evidence that either company
would be more adversely affected by the current market climate in
comparison to other competitors.
Andrea Gomes da Silva, CMA’s Executive Director for Markets and
Mergers said:
viagogo is already the largest secondary ticketing company in
the UK by some considerable margin and has purchased an
established rival, with no other significant competitors in the
market. We are therefore concerned that this transaction could
lead to customers losing out through higher prices, less
innovation and a lack of real choice.
viagogo now has 5 working days to address the CMA’s concerns by
offering remedial undertakings in lieu of a reference to a ‘Phase
2’ investigation. For the CMA to accept undertakings, viagogo
would need to deliver a clear-cut solution that will preserve
effective competition in the UK market. If viagogo is unable to
do so, the deal will be referred for an in-depth (Phase 2)
investigation.
For more information, visit the case page.
