Ticket scrambles, scalping, unsavory characters, and disheartened music fans have been around for a long time, but the Ticketmaster/Live Nation merger added a layer of complexity to what was already a Godfather-esque state of affairs, in what has to be the dirtiest corner of the uber-sketchy music business.
The Springsteen Debacle (Ticketmaster vs. NATB)
During the recent Bruce Springsteen ticket sale, fans who logged onto Ticketmaster found themselves locked out of the system. Yet brokers had seats selling for hundreds of dollars– by some reports, before the public sale began. Everyone pointed fingers. Ticketmaster said their system froze due to unscrupulous scalpers using illegal “bot” software. They of course promised a full investigation (said the fox, concerning all those missing chickens). The National Association of Ticket Brokers claimed that the real problem was the limited number of tickets put on sale. This isn’t the first time Ticketmaster got in trouble with a Springsteen show. In 2009, fans were shuttled over to the higher-priced secondary seller TicketsNow (owned by Ticketmaster), while regularly priced seats were still available. Responding to widespread complaints, Rep. Bill Pascrell (NJ) stepped in and proposed the aptly named B.O.S.S. Act (Better Oversight of Secondary Sales and Accountability in Concert Ticketing), advocating full disclosure and transparency. With venues, promoters, sponsors, ticket sellers, and artists all staking claim on tickets before they go on sale, it’s a wonder there are any left at all.
How Does It All Work?
Trying to sort out this mess isn’t easy. There are so many entities trying to cash in on high-demand concerts, it’s mind numbing. In response to his own fans’ frustration, Trent Reznor gave an enlightened, highly detailed view of how the industry works. Blocks of seats are often “pulled” before the public sale by the ticket sellers, promoters, venues, sponsors, and artists, though it isn’t clear who the gatekeeper is. Promoters and artists set the ticket prices, but they don’t want to be seen as charging an exorbitant amount for premium seats, even though there are fans willing to pay. As a result, some artists will scalp their own tickets on the secondary market, so they can get a portion of the profits. Other tickets are yanked for presales, VIP packages, and sponsors. It’s a complex storyline with multiple subplots and nefarious characters, worthy of a spy novel. But all this confusion and deceit breeds mistrust. In an industry where 40% of its product goes unsold (due to less desirable seats priced too high), they can’t afford to alienate any of their customers.
Live Nation Entertainment’s Power Grab
In retrospect, granting Ticketmaster and Live Nation permission to merge back in 2010 probably wasn’t a great idea. As it stands now, Ticketmaster controls the majority of the primary market, and are at work to secure the secondary market. They own TicketsNow, and have introduced paperless tickets for many of their shows, effectively thwarting outside brokers. With TicketExchange, they’ve addressed fans’ complaints of not being able to resell paperless tickets they can’t use, but it’s a closed system, keeping everything under the Ticketmaster roof. They’ve also introduced dynamic pricing, in much the same way that hotels and airlines handle it, changing the prices of tickets based on various market factors. With dynamic pricing and multiple “price points,” they’re moving toward a time when primary and secondary ticketing are merged together, eliminating the secondary market altogether.
Live Nation Entertainment recently entered into a partnership with Groupon, to help sell those less desirable unsold tickets at (presumably) reduced prices. In addition, they own TicketWeb, a Ticketmaster-powered self-service online ticketing and marketing site for independent venues and promoters (meaning the ones they don’t yet own). And VIP Nation, another Live Nation company, is a service that offers high-priced VIP packages, which include premium tickets to shows. They have their concert promotion business, and they also own many clubs (i.e. the House of Blues franchise), concert halls and amphitheaters, meaning artists must use Ticketmaster to play at these venues, or find non-affiliated venues to perform in. Here in Boston, between Ticketmaster and TicketWeb, they control ticket sales for every significantly sized venue in town, from T.T. the Bear’s Place and O’Brien’s Pub, on up. Live Nation Entertainment is also in the artist management and merchandising business.
The Battle of the Grassroots Campaigns (Live Nation Entertainment vs. eBay)
After their merger with Live Nation was approved in January 2010, Nathan Hubbard, who previously ran artist-to-fan ticket and merchandise seller Musictoday and set up then rival Live Nation’s ticket selling operation, was named as Ticketmaster CEO. Since then, he has taken steps to put a friendlier, more “fan loving” face on the much-reviled company, while simultaneously seeking world domination of the concert business.
Ticketmaster’s battle with main competitor StubHub (a division of eBay), over the $4 billion secondary ticket market and to win fan support, has created highly amusing rival PR campaigns, thinly disguised as “fans’ rights” advocacy groups. In March of last year, the Fan Freedom Project was established, largely financed by StubHub. Two months later, the Fans First Coalition appeared, financed by Live Nation Ent. Not surprisingly, many artists dependent upon Ticketmaster’s services and Live Nation venues have signed on. No doubt they wish to avoid being blacklisted and relegated to gigs at shopping malls and amusement parks (though Live Nation may one day own those as well). The good news, however, is that while they disagree over paperless ticketing and dynamic pricing, they do agree on the need for transparency. This is something we should all rally around. Before we can sort out this mess, we need to see exactly what is going on.
Where is the artist in all of this?
Since it is the artist people are paying to see, they should by rights get a significant portion of the profits from those marked-up tickets. It should also be up to the artist and their management how tickets are allocated. Without them, the entire industry would instantly disappear, while the same cannot be said of any of the other involved parties.
Some artists take advantage of the secondary market, selling their ticket allocations so that they can at least see some of the money that brokers get for those premium seats. Fans may be more likely to purchase from a secondary seller (or pay higher prices for better seats from the primary seller) if they at least know the artist will see some of this money. In the case of TicketsNow, the artist does get a percentage, though it’s not clear how much.
Savvy artists try to make ticket purchasing less treacherous for their fans by offering presales on their own sites (using will-call tickets, to thwart scalpers), and there’s increasing popularity of “VIP packages” that include choice seats along with other benefits, such as exclusive merchandise, access to soundchecks, and meet & greets. These types of deals are of great value to the fan, and something that ticket brokers not affiliated with the artist can’t offer. Which begs the question: Should anyone but those directly involved in the event and the marketing of that event be making any money from the sale of concert tickets?
If artists wish to completely avoid Ticketmaster, there are a few alternatives such as TicketFly, Topspin Media, and most recently, AEG Live’s Axs Ticketing, but Ticketmaster is for now the market leader.
Understanding The Lay of the Land
Much of the frustration lies in being kept in the dark concerning the true nature of the ticket marketplace. For a popular band, one can spend hours trying to get onto Ticketmaster’s site, while seats pop up for crazy prices all over the internet. The situation is so confusing that a new “cottage industry” has sprouted up – that of the ‘concert ticket aggregator’ (i.e. TiqIQ) that gathers all the tickets available for that event from all corners – eBay, StubHub, TicketsNow, etc. Wouldn’t fans rather pay the artist more for those choice seats, rather than some dodgy middleman?
I remember the good ol’ days, when fans turned up to the venue the night before tickets were to go on sale, armed with sleeping bags, for a shot at some decent seats (and I also recall that they usually got them). Those days are long gone. For better and for worse, we now have the internet. But we can use the technology to make ticket purchasing fair and reasonable again.
Let’s Start with Full Transparency
Airlines use interactive maps to show which seats are available on their planes, and customers can choose exactly which seat they want. Ticketmaster, partnered with Facebook, already has this ability with their Interactive Seat Map (currently used for selected events), and it even shows where your Facebook friends are sitting. This detailed map should be available before the public sale begins, and it should display every block of seats that has been pulled, and by whom (band presale, VIP ticket packages, secondary market, etc.). It will then be clear just how many tickets are really available, and where particular sections are being sold, so fans can have the widest choice at variable pricing.
Hopefully this full disclosure will put an end to all the ‘smoke and mirrors’ tactics. After being forbidden for a year from linking to their TicketsNow site from event pages (as a result of the Springsteen mess in 2009), Ticketmaster has once again reintroduced the link. According to a report on ticketnews.com last August, “Ticketmaster clients can decide whether they want sold out tickets to their events to also be available to fans through TicketsNow… This will provide fans more ticket options and in the process clients will participate in the revenue generated from the resulting ticket resale transactions.” Sold out tickets? Doesn’t “sold out” mean that there are no more tickets? How did TicketsNow suddenly get hold of choice seats immediately after the show became sold out? They didn’t, of course; those tickets were pulled before they ever went on sale and given a higher price-point. For the love of god, just do it up front! Or at least clearly state which seats have been pulled, and where they can be purchased. Don’t waste the fans’ time, when everyone knows damn well what’s going on.
People want to know where their hard-earned dollars are going. They want immediate access to higher-priced premium seats (if they can afford them); otherwise, they want reasonable prices for the less-desirable tickets. And they want this without confusion, frustration and anxiety. If the situation doesn’t change soon, they might just stay home and watch the show on TV.
For Further Reading
The traps of shopping for concert tickets, USA Today, June 15, 2007
Novel ways to put tickets in fans’ hands, USA Today, June 15, 2007
TR thoughts on ticket re-sellers / scalping (Trent Reznor explains the ticketing industry), NIN Forum, March 15, 2009
Can Ticketmaster CEO Nathan Hubbard Fix The Ticket Market?, Forbes, February 18, 2011
Young CEO Seeks to Reset Ticketmaster With Tech and Transparency, Wired, March 17, 2011
Ticketmaster CEO Nathan Hubbard On Groupon-Live Nation Deal, Fast Company, May 11, 2011
Ticketmaster: Rocking The Most Hated Brand In America, Fast Company, June 21, 2011
Scalping Battle Putting ‘Fans’ in the Middle, New York Times, July 20, 2011
Ticketmaster launches new TicketsNow ticket resale initiative, Ticket News, August 22, 2011
Ticketmaster Teams With Facebook So You Can Sit Next To Your Friends, Fast Company, August 23, 2011
Scalper ‘Assault’ Caused Website Jam for Bruce Springsteen Ticket Sales, Ticketmaster Says, Billboard, January 27, 2012
Rep. Pascrell’s Statement In Reaction to Today’s Problems with Online Ticket Sales To Upcoming Bruce Springsteen Concerts, The Paramus Post, January 27, 2012
Definitely NOT Dynamic: Ticketmaster ‘Assaulted’ by Scalpers on Springsteen Sale, Digital Music News, January 28, 2012
Live Nation deals with more Springsteen ticket issues, while AEG discusses the roll out of its Ticketmaster rival, Complete Music Update (CMU), UK, January 31, 2012
National Association of Ticket Brokers (NATB) Urges Transparency for Sales of Entertainment Tickets, PR Newswire, February 1, 2012
TiqIQ Announced Series A Round, Private Equity Hub (peHUB), February 13, 2012
Live Nation Entertainment’s ticket resale may violate Ontario anti-scalping law, Ticket News, February 21, 2012
‘Fan Advocacy Groups’
Fan Freedom Project (StubHub/eBay)
Poll Shows Confusion, Lack Of Transparency In The Ticket Market, July 14, 2011
Ticketmaster Blog Post Attacking Resellers Riddled With False Claims, August 17, 2011