Merger of viagogo and StubHub raises competition concerns*
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.