Taylor Swift, Ticketmaster, and Chokepoint Capitalism with Cory Doctorow

Episode Summary

Executive Summary: Bethany McLean and Luigi Zingales interview Corey Doctorow about Chokepoint Capitalism, using Taylor Swift/Ticketmaster, Audible, Amazon, and digital advertising to argue that concentrated corporate power and weak antitrust let firms sit between creators and consumers, extracting value, suppressing competition, and enabling fraud. They debate regulation, regulatory capture, and whether the problem is capitalism itself or its corrupted practice.

Main Topics: Chokepoint capitalism vs. ordinary market power (Priority: 5/5): Doctorow defines chokepoint capitalism as concentrated buyer power and intermediary control that makes creators dependent on a few firms. Copyright and contract protections are weakened when sellers must pass through monopolistic gatekeepers. Taylor Swift, Ticketmaster, and live entertainment concentration (Priority: 5/5): The episode uses Ticketmaster/Live Nation and the Taylor Swift ticket debacle as a vivid example of market concentration failing consumers and artists, with alleged secondary-market manipulation and inability to manage demand. Creator compensation and unfair contracts (Priority: 4/5): The discussion focuses on royalty audits, nondisclosure agreements, and state-law reforms that could improve bargaining fairness for authors, musicians, and other creators without defining a perfect wage benchmark. Amazon, Audible, and platform lock-in (Priority: 5/5): Doctorow argues that Audible’s dominance, DRM lock-in, and app-store commissions make it hard for rivals to compete and enable opaque royalty clawbacks from authors. Online advertising as a fraud-prone duopoly (Priority: 4/5): The speakers examine Google and Facebook’s dominance of search/display ads, auction manipulation, fake metrics, and publisher revenue erosion, showing how opacity and concentration enable extraction. Antitrust, regulation, and regulatory capture (Priority: 4/5): The conversation contrasts consumer-welfare antitrust with older anti-monopoly traditions, while also debating how regulation can be captured, as in GDPR enforcement and the history of the DMCA. Capitalism, competition, and long-term value (Priority: 3/5): The exchange closes by questioning whether these are failures of capitalism or failures of competition, with emphasis on the need for simple, enforceable rules and pluralistic markets.

Key Arguments: Doctorow argues that in concentrated creative markets, giving creators stronger copyright is often ineffective because buyer power and gatekeepers can still seize most of the value. A fairer system does not require perfectly defining a 'fair wage'; instead, it should rebalance bargaining power and eliminate rules like mandatory NDAs around royalty corrections. Ticketmaster’s Taylor Swift failure is not just mismanagement: it reflects decades of antitrust forbearance that allowed a vertically integrated monopoly over venues, promotion, and ticketing. Audible is harmful to consumers not merely because of price or convenience, but because platform lock-in and app-store policies prevent rivals from offering better services. Digital advertising is described as fundamentally compromised because Google and Facebook dominate both the market and the auction infrastructure, enabling self-dealing, fake impressions, and publisher undercutting. The DMCA’s anti-circumvention rules are presented as a regulatory mistake that criminalized interoperability tools and entrenched platform control. Regulation is necessary, but anti-capture design matters: simple, enforceable rules, pluralism among regulators, and transparency are better than assuming regulation is futile. McLean and Zingales agree that much of the damage comes from weak enforcement and fragmented oversight, but they are less certain that every example is best explained by market power alone.

Data Points: Decline in creator income share: More than half since the Great Financial Crisis - Doctorow’s discussion of author advances and royalties in the publishing/music industries News publisher ad revenue share: As little as 30 cents on the dollar - Money from ads on content shifting away from news publishers Book/record-label audit finding: Tens of thousands of audits over decades; every instance but one favored the label - Accounting errors found by a Los Angeles firm auditing record-label contracts Ticketmaster market share: About 90% of the ticketing market - Described after mergers with Ticketron and Live Nation Audible market share: About 90% of the market - Doctorow’s explanation of Audible’s dominance in audiobooks Display advertising concentration: North of 80% controlled by Google/Facebook - Discussion of digital ad market dominance Search advertising concentration: North of 90% controlled by Google/Facebook - Discussion of digital ad market dominance App store commission: 30% - Apple and Google commission on in-app file sales Retail margin on audiobooks: 20% - Doctorow’s example of selling audiobooks directly versus through app stores DMCA anti-circumvention penalty: 5 years in prison and a $500,000 fine for a first offense - Doctorow’s explanation of Section 1201-style anti-circumvention enforcement Copyright treaty history: 1998 DMCA; 1996 information superhighway hearings - Timeline for the anti-circumvention regime and its legislative roots Taylor Swift concert timing: A year's notice - Ticketmaster had advance knowledge of demand for the tour

Pivotal Quotes: "If you have to go through five publishers or four movie studios or three record labels to reach your audience, giving you more copyright is like giving a bullied kid extra lunch money." — Corey Doctorow: Explaining why copyright is weak in monopsonistic creative markets "We have to intervene by making sure the market really is competitive." — Luigi Zingales: Framing the debate over antitrust and the appropriate role of government intervention "I don't think that markets are useless. I do think that in the absence of state intervention to ensure that firms don't grow to dominate their markets, that markets always fail." — Corey Doctorow: Summarizing his view that competition requires active public enforcement

Implications: Listeners are left with a strong case for antitrust enforcement, interoperability, and simpler rules that creators can actually use. The episode suggests that platform dominance, not just greed, is reshaping culture, media, and consumer choice.