Following an in-depth investigation, the Competition and Markets Authority (CMA) has provisionally found that the completed merger of viagogo and StubHub will reduce competition.
The CMA found that viagogo and StubHub are close competitors in an already very concentrated market with no significant additional competitors. They are the only two companies of material size in the UK’s secondary ticketing market with a combined market share of more than 90%.
viagogo purchased StubHub in February 2020 and the CMA started its in-depth ‘Phase 2’ investigation in June after finding concerns during an initial probe.
As part of its Phase 2 inquiry, the CMA has provisionally concluded that viagogo’s purchase of StubHub is likely to result in a substantial lessening of competition in the online secondary ticketing market. The CMA is concerned that the merger could lead to increases in fees for customers, including fans, who resell or buy secondary tickets to live events. The CMA also found that the merger could result in a lower quality of service and reduced innovation in the sector.
In reaching this provisional decision, the CMA analysed a wide range of evidence regarding how closely these firms compete, including examining the extent to which resellers use both companies’ platforms, the prices and fees charged for resold tickets and the companies’ internal documents. It also engaged with customers, competitors, and other stakeholders to inform its findings.
The CMA is mindful of the significant impact that the coronavirus pandemic is currently having on the live events industry. However, the evidence is that viagogo and StubHub would remain important competitors for the foreseeable future without the merger.
The CMA has set out potential options for addressing its provisional concerns, which include requiring viagogo to sell all or part of StubHub. Views are invited on the provisional findings by 12 November 2020 and 5 November 2020.
Stuart McIntosh, Chair of the CMA inquiry group, said: “The evidence we’ve seen so far consistently points in the same direction – that viagogo and StubHub have a market share of more than 90% combined and compete closely with each other. We are therefore concerned that their merger could lead to secondary ticketing customers facing higher fees and lower quality services. We’re now inviting comments on our provisional findings and possible remedies.”