This is super sleezy and I think Ticketmaster is one of the most awful companies in the world. But given the ridiculous levels of scalping that goes on every day (including all the companies that attempt to normalize it, like StubHub), doesn't it all imply that the fair market price of a lot of tickets is way higher than what they sell for? Obviously demand is way outstripping supply or people wouldn't pay $500-$1000 for $100 tickets on a daily basis.
By making all event tickets available at exactly the same time for an effectively-lower-than-market price, of course professional scalpers are going to snap up almost all of them and normal people without scripts won't be able to compete. I wonder what would happen if tickets went on sale for a really high price (like $500 each) and then the prices kept dropping automatically every hour until they were all sold. That would kill a lot of advantage that the scalpers have.
I guess customers would hate it and promoters would hate it, but I wonder if there isn't some other kind of sales model that would make this kind of sleezy self-scalping less profitable. Because with market forces this strong, companies are going to do anything that is legal-ish to get a piece of it. If Ticketmaster doesn't figure out a way to get a piece of the massive resell market, they are essentially just giving away free money to StubHub (from their point of view).
Ticketmaster provides a valuable service for the associated acts:
Reputation shield
If artists started charging fair market prices for their tickets the fans would go ballistic and the artists' reputations would be severely damaged. By ostensibly selling the tickets below, even if normal people never get to buy them at face value, they outsource the reputation damage to Ticketmaster. Since Ticketmaster already has a detestable reputation, they are well-equipped to provide this service with minimal damage to their brand. In exchange, Ticketmaster pays a portion of their revenues to the promoters and their associated acts. It's a win win: artists get more money without damaging their credibility with their fans.
I'm confused, so like an artist would be paying 80% of his potential revenue ($100 vs. $500) in return for reputation shield? That's how valuable this service is?
Artists' reputations may take a hit if they price their tickets overly high, as it's seen as gouging fans. Instead, Ticketmaster charged multiple hidden fees for each ticket, often including a venue fee, service fees, and other interestingly named fees that are different based on the event, venue, and tour (although all events in some tours might have a similar fee, some some venues might have a similar priced venue fee across all events...).
Some of these are collected and go right back to the artist, promoter and venue. Fans are unhappy about this, but they place the blame on Ticketmaster, not the artist or venue. This is the reputation shield Ticketmaster offers. They take the blame for higher prices while passing a lot of those fees back to the artist and venue. They take a cut for processing the order, and probably a higher than normal cut for taking the negative PR, but both Ticketmaster and the artists and venues make more money in the end.
The kickbacks go mostly to the venues who then write Ticketmaster into their contracts, making it really hard for artists to find somewhere to play without Ticketmaster being the manditory ticketing provider.
On a $50 ticket there is usually $20 in added “Ticketmaster” fees that go to the promoter and artist. That 40% increase is what Ticketmaster protects - the scalping sites mostly make money for scalpers, and also to unscrupulous venues who hoard tickets.
Is it possible that charging fair market value would torpedo a performer's reputation so badly that they can't sell tickets at all anymore? The industry is very competitive, so maybe they're afraid fans would abandon them for some other performer?
If so, then 20% of something is better than 100% (or any percentage) of nothing.
Or maybe they are looking at the total revenue picture, of which concert ticket sales are only one part, the others being record sales, private shows (at corporate events), TV appearances, and springboarding from musician into other entertainment roles like acting. Losing some money in one area out of all those might be cheap insurance to protect the others.
Before Ticketmaster, you could go to or call the box office and reliably get tickets to shows in your own city. Now I have to buy them from scalpers in Canada. Ticketmaster artificially expanded the market and used its leverage to force venues into exclusive deals. It's got nothing to do with "market price".
Edit: Also artists get a cut of the bar and to sell their merch. Also also, there is a massive range of costs of tickets already. It's really not a market price issue for tickets.
> That's like saying an author gets royalties from a used book store.
It's like saying an author gets royalties from a "used" book store that is able to sell a pristine version for no extra cost for every resale it makes, but it requires opt-in from the author.
TM+ doesn't just resell tickets, It's opt-in only and artist and venue opt in, it actually reissues new tickets, with new barcodes, to the purchaser with a guarantee.
It would not surprise me at all if the resale system gave a percentage of the profit back to those who opt in, to incentivize them to do so.
I always thought was to maximize ticket sales and leave fewer empty seats. (Not all concerts sell out). You have people that can pay for the convenience of buying later paying more. But the true fans get their tickets early.
It was noted by me when shooting an aerosmith concert that the first 2 or 4 rows were reserved for fan club members.
If you are seeing primary market prices of $1k for a VIP package, you can be assured these same packages are going for $3-4k direct to brokers, and $5k+ on secondary markets to buyers.
Those are separate things. The VIP/Premium tickets are a way to do dynamic pricing without looking like you're proving too many price levels. The extra fees are a way to show lower prices and let the fallout for the end price fall on another group. I outlined a lot of this with real data in another comment here. Just search for "mccartney" in the comments here.
They are - but, where, say, 5-10 years ago VIP might only be the front couple of rows, for some tours now it might entire sections, especially on the floor.
Yes. But it's not the artists who are in control. It's the event promoters, yes? That is, the band names it's price. A promoter books the band, picks the venue, markets the event, and sets the ticket price. If the tickets are underpriced it's the event promoter who is getting hurt the most.
But when the artist demands a certain payout, and the only way the promoter can make the numbers work is to set a "face value" $X, offer 15% of inventory at $X on the open sale, and then offload everything else directly to ticker brokers at various tiers of price points at several multiples of X, you have to start to put at least _some_ of the blame on the artists for knowingly participating in a "don't ask don't tell" style industry...
Perhaps. But then where do the bands make money? From their Spotify streaming royalties? That's not enough to buy coffee.
In other words, free (or historically close to it) music comes at a price. If you calculate what is __not__ being spent on listening to music, I suspect you'll see that decline made up for via touring / ticket prices.
But that's not the start in my scenario. It's the end. It's a symptom. It's the result of what happens upstream in the broader biz model of being a band / musician.
With their revenue streams limited (read: streaming doesn't pay anything close to the way physical media did) they're all but forced to require a larger payout. If they don't get it there, then where? When?
Think of it this way, every time you stream a song for free the cost of that band's live concert ticket goes up a bit.
Promoters are well aware that they sell tickets for less than they could get but I think it's unlikely to change. There are essentially 2 ways to distribute things. A free market model where the highest bidder gets to buy. Or a price control model where only some people get to buy based on some arbitrary selection model, usually first come first serve. And everybody else is SOL. When people think (emotionally) of what is "fair" they typically think of the price control model, which is why we have rent control, price gouging laws, and people get pissed off at Uber surge pricing. So if promoters try a more market based strategy like the one you mention it will probably cause a backlash from fans for charging $500 for a ticket. Unlike the promoters, scalpers have no perceived connection to the artists, so they (or Ticketmaster) can take the public outrage in exchange for profits without risking future ticket sales.
I'm a big fan of the system that the sneaker companies have slowly adopted. Interested people sign up ahead of time with a registered account. You get a notification right before the release that you have to confirm. Then a raffle takes places where the winner gets charged immediately. It's about a ten mInute investment, which with how sneaker quality has gone down in recent years (especially Nike) is about all the time it is worth it to me anymore.
Only issue I can see is that with sneakers there is almost no reason to get more than one pair unless you're reselling. Buying multiple tickets for a concert makes more sense. There could possibly be some increasing fee charged over a certain number, that could suck profit away from scalpers. The fee only occurs if the tickets are all presold.
This is effectively the system used by the popular festivals in the UK, particularly Glastonbury. You need to pre-register for tickets, which involves uploading photos. When it goes on sale, only pre-registered users can buy, and the photos are checked on entry. Other festivals do the simpler thing of checking the names on the booking against ID. Many allow a secondary market in tickets, but only at or below face value for those who are unable to go. This shows what can be done if they really do want to stop scalpers.
Non automatable hoops to jump through can definitely be a good way to determine who “deserves” the tickets. There’s technological ways to do that, but it’s a magic sauce that would make a company a lot of money.
The problem is when all tickets sell out in a couple minutes (at the unrealistic list price), limited only by the IT infrastructure handling the orders. In this case only "professional scalpers" can win the race to be "first". OK, now we're caught up to present day, is there any way we can make this system less silly and have less of the money end up in the hands of middlemen ...
>less of the money end up in the hands of middlemen
This is the deceit of the whole system though. This system isn't just about "middlemen" extracting value. The _artists themselves_ directly profit from the multi-tier selling system. A performer like Bieber or Adelle is actually directly selling large blocks of premium seats directly to ticket brokers ("scalpers") _at a premium over face value already_.
I think there's less of that happening, and more of either agents on behalf of the artists are selling directly on the exchanges, or there's a profit sharing agreement with select brokers. Whether there's a difference between those two things is up to you to decide. But yes, often large chunks of inventory seem to never become available on the primary market, for whatever the reason.
>either agents on behalf of the artists are selling directly on the exchanges, or there's a profit sharing agreement with select brokers
This is just mental gymnastics to absolve performers of economic responsibility for the market in which _they_ are the source of all value in play. The artists are directly complicit because they want to get famous and make the big bucks. The ones who don't play that game are the bands you might see touring local venues and working out a $10-$20 cover charge with the bar they play at.
>often large chunks of inventory seem to never become available on the primary market, for whatever the reason
I worked at a secondary ticket marketplace company and I am trying to explain to you what is _actually happening_ in the real world every day in this industry, from my direct experience. I'm not hypothesizing here...
Edit: can't reply to you again, but I think we're on the same page :)
> This is just mental gymnastics to absolve performers of economic responsibility
I'm fully putting blame on the artists for this behavior. I'm just wording it slightly differently because I think it's less of a "broker approaches artist with a good deal" situation than a "artist decides they want to have their cake and eat it too and quietly sell on the secondary market for more money." That's not definitive though, I'm sure there have been plenty of brokers that have approached everyone in the entertainment industry in the past.
> I worked at a secondary ticket marketplace company and I am trying to explain to you what is _actually happening_ in the real world every day in this industry, from my direct experience. I'm not hypothesizing here...
I work in it currently, and have for years. Everyone in the industry believes that, but few will outright say they have access to that definitively (for obvious reasons). If you have direct knowledge that it was happening at your company or direct knowledge of another company doing so, I'm happy to have confirmation. I just didn't want to be overly assertive about something I didn't know as fact, and wanted to express what I saw as the general industry consensus ("it happens, there's no proof"). :)
Sure. That'd probably work. That's why the article is so explosive... it shows that TM will never implement anything to make its service fair to the actual fans.
My comment applies to situations where the ticket price is massively different than the market clearing price. If a ticket is priced close to the market clearing price then it isn't really a price control situation. I'm guessing that this is probably closer to the situation for the symphony.
If the symphony was an auction system, tickets might sell for $110 each. It fills up with a $100 each first-come system, most people who want tickets can get them, tickets are sold at only a $10 discount of auction value, and it "feels fair." The first-come-first-serve system works well for the symphony.
If the pop-star concert was an auction system, tickets might sell for $999 each. With first-come-first-serve and a set $100 price, each ticket is sold at a $899 discount of auction value. Moreover, most people who want tickets cannot get them directly as they sell out instantly because of the relatively steep discount (90% discount vs 9% discount).
The first-come-first-serve system only works well when prices are set near a market-clearing value, like with the symphony. As stated elsewhere in the thread, people would get super upset at $999 tickets. They would think "those greedy pop-stars price tickets way too high, it's so unfair." So pop-stars are unwilling to set prices at the high market-clearing value, and use the first-come-first-serve with way underpriced tickets (getting some money back by having agreements with scalpers or Ticketmaster).
Demand way exceeds supply, tickets sell out instantly (mostly to scalpers). Most fans never get to see the concert at the "fair-seeming" $100 price and are upset at "those nasty scalpers" and pay near $1000 to see the concert anyways. But the scalpers (or Ticketmaster) are the ones whose reputations are harmed, saving the artists' reputations.
The purpose of a pricing strategy is to maximize the capture of value from a given market. Auction pricing works when:
1) It is a single event-based POS
2) Every member of audience has the same level of knowledge of what is being sold
For a symphony, the audience is smaller and more homogeneous than a pop-star concert. Symphony attendees are typically repeat buyers, who share similar knowledge of what they're seeing, and will know well in advance if they are going to attend.
Pop-star audience goers will make the decision to buy and will need to confirm purchase at different time points before the event. They also have varying degrees of knowledge as to how much the ticket price really should be, meaning they are not going to be good at bidding and won't fully participate.
First come first serve doesn't work for most concerts and live sporting events because the true market value, meaning the rate at which "the market" will bear a price-point and still relatively easily sell out all the supply (seats), or at least enough to cover costs for the venue/act/promoter, is well above what is printed on the physical ticket as "market value." I would guess that Symphony tickets on the secondary market simply don't fetch enough _margin_ to justify the type of extensive secondary inventory sales infrastructure that pop concerts and pro sports games do. You're starting to see this change though, with NYC broadway at least, with shows like Hamilton and The Importance of Being Earnest fetching just as large secondary market margins as any pop concert.
If you want data to illustrate this point, there's an article on The Ringer site a few years back that was written by a guy who was the CEO of ticketmaster for several years. He said "If you add up the face value for every seat in the venue, that total number is _less_ than what most popular artists are paid out for that show in just the artist appearance fee." This should show you how fake the entire idea of "face value" is...
> So if promoters try a more market based strategy like the one you mention it will probably cause a backlash from fans for charging $500 for a ticket. Unlike the promoters, scalpers have no perceived connection to the artists, so they (or Ticketmaster) can take the public outrage in exchange for profits without risking future ticket sales.
Yeah, which is why the promoter should just present itself as a scalper, "selling out" 100% of its tickets to a subsidiary, which then does a reverse auction like in the GP's comment. Fans won't care, because nothing has really changed from their perspective; the promoter will make more money (that the artist can demand be passed on to them); actual scalpers, economic parasites that they are, will make less money; the market will clear more efficiently; economists will be satisfied. Everyone wins.
Everyone except for—as can be seen in the OP article—non-economically-versed journalists, and those that they manage to incense with their rhetoric.
> actual scalpers, economic parasites that they are
Scalpers/brokers aren't economic parasites, they provide a function to artists and promoters by offloading risk, and they also provide liquidity to fans.
If if it comes down to selling out 50% of a venue immediately and the other 50% over the next 2-3 months, or selling out 100% of a venue in one day, I imagine most promoters and artists would like that money now so they can utilize it. Brokers trade use of money over time for risk. Sometimes they make money, sometimes they lose money because it's overbought, they misjudged the market, or more supply was provided (a date added at that location). For example, see here[1], where resale tickets are under the cost of primary market tickets, $36.50 instead of $39.50, and that's before Ticketmaster/Stubhub takes 5-10% of the sale price from the seller. On Stubhub[2], the same tickets are going for $27.
> If if it comes down to selling out 50% of a venue immediately and the other 50% over the next 2-3 months, or selling out 100% of a venue in one day, I imagine most promoters and artists would like that money now so they can utilize it.
If you have revenue figures to indicate that it's pretty much guaranteed you'll sell out your stock of something eventually, and you want short-term liquidity, you can just issue commercial-paper securities, and people will buy them.
Sure, if you don't have people clamoring to buy you tickets immediately anyway that will provide you that money at no interest, that would make sense. In what way is that system advantageous to the current one, given the other incentives that exist to not raise price (public relations, mostly)? Also, given that I suspect brokers are worse at getting this right, since they don't get to see all the data, and you can make quite a lot from brokers on events that undersell...
Because it provides an accurate value indication. Whether brokers or fans are reselling, it's going to happen. I don't imagine.moat fans are going to be keen on making sure their inventory is priced multiple times a day, much less multiple times an hour.
This also helps fans that decide they don't want to (or can't for some reason) go. They get a good indication of what their tickets are worth.
That said, i was also using liquidity as a stand in for increased availability. The fact that the market is liquid allows people a fair level of confidence that in the worst case they can recoup the cost of their tickets (give or take some percent) if they don't go.
Really, how is this any different than investing in an IPO? Those are mispriced all the time too.
You can buy a ticket knowing that if something comes up you will get your money back. You can decide to go to an event last minute and tickets will be available.
But they would be available anyway if the scalpers hadn't bought them all up. And if legitimate fans had bought all the tickets (sold out early), you wouldn't be getting a ticket either way, right?
I'm a legitimate fan and willing to pay a fair price for a ticket, but due to my job I usually can't buy the moment the ticket is released. So if it weren't for the "scalpers" I'd never get to see a show.
Offload it straight onto the consumer. If I pay 2x the TM price from a scalper and the event is cancelled and TM offers "full refunds " I'm out the difference.
No, you usually aren't. Both Stubhub[1] and Ticketmaster (through their TM+[2] resale platform) offer full refunds. If the reseller has already been paid, the amount is either deducted from the next payment to the reseller for sales, or taken out of the linked bank account or credit card. If the reseller hasn't been paid yet (they generally get paid on delivery, not on sale), they just don't get paid.
Even if for some reason the exchanges can't recoup the refund cost, they'll just eat it. Exchanges live and die by their reputations, which is also why they punish resellers heavily for delivery problems or invalid tickets.
Who do you think is selling on the resale marketplaces? The nice name is broker, but multiple people here, and the article these comments are on, use the term scalper. The vast majority of inventory resold by people that purchased with the intent to resell is sold on Stubhub, TM+, or Vivid Seats. The majority of inventory on those platforms is from brokers. Who bothers buying direct from an individual anymore?
The article in question is actually about scalpers (brokers) using Ticketmaster's resale platform (TM+) and Point of Sale for managing inventory (Tradedesk).
I feel like the New York Comic Con has a done a good job preventing scalpers from ruining the experience for its customers with Fan Verification. Since it was implemented I haven't had to worry about tickets being sold out in minutes.
That's an interesting approach. San Diego Comic Con takes the approach of making you jump through so many hoops that only obsessives can make it through the processes.
To buy a ticket, you have to create an account to buy a ticket before the ticket sale date is announced. Once the date is announced, you are no longer allowed to create a new account for that year's sales. Then you get assigned an hour-long time slot in the far future during which you have to be actively present online to enter a lottery to see if you have the chance to even buy a ticket. Then you have to buy the kind of ticket you want before that batch sells out.
And if you went the previous year, there's a whole different set of rules to figure out of how to maintain your eligibility to buy a ticket the next year with it's own different set of dates and forms to fill out.
All of this is incredibly hard to figure out if you don't spend your life trying to figure out how to buy Comic Con tickets. There are multiple dates you have to plan around and you have to show up during your 1-hour purchase window even if it's in the middle of the night for your location.
So while it prevents most scalping effectively, I personally think it's a crappy experience and a crappy solution.
I just don't get it. For almost any event I can barely gather the enthusiasm to raise myself from my rather pleasant sofa, cope with the trauma of travel and missing that night's TV not to mention the "oh god how do I get home again" nightmare.
I guess it’s a choice between watching show X in comfort or standing in line for 6 hours for a chance to spend 10 seconds with an actor/actress from show X. Probably not even the main star as they have better things to do. Put it like that and it’s a no-brainer.
Knowing ticketmaster, they would milk such a verified fan program for all it's worth. They'd want full access to the user's social media information for instance.
> The most elaborate (and controversial) example of this so far was Swift’s choice to offer “boosts” that could be procured by buying her album several times (on her website, from Walmart, from Target, from iTunes), buying merchandise, engaging with sponsors on social media, or watching her music videos. The boosts supplement Verified Fan and sort fans into a line, with the most dedicated — measured both in time and money — bumped to the front.
Swift’s choice to offer “boosts” that could be procured by buying her album several times
I am really shocked and disappointed, Tay-Tay always seemed so nice. Whereas you would expect it from, say, Metallica, who take contempt for their fans to a new level
There's usually more than one perspective. How else do you identify real fans from people that sign up to get presale codes? Rewarding those that are part of a fan community is pretty easy if you have that info. The fact that you can easily track all that is a little disturbing, though.
Making fans buy more than one copy of the same album is pretty low. If it was just “buy all the singles” then at least you would get the B-sides or remixes too. I am a big fan of T-Swizzle but I like her a bit less now.
If that's true, yes, it's pretty crappy. It could also be an unintended loophole brokers discovered that allows higher likelihood of getting a verified fan code, which wouldn't surprise me.
Are you only thinking about her public marketing image? I feel like any amount of digging into who she is as a person makes this "nice girl" thing way more complicated...
Are you only thinking about her public marketing image?
Sure, I am aware of that, but making fans buy multiple copies of the same album to be in with a chance of spending even more money on a concert ticket is part of that image too.
Hardly. As someone that works for a broker, it is exceedingly hard to get verified fan to work at scale, and you burn that account and work put into it after it's used. I know a broker that was buying access to gmail accounts that had been around a long time, facebook accounts with lots of activity, and using AT&T phones to get the verified fan SMS. The cost was about $40 for the gmail/facebook accounts, not including the phones. According to him, both accounts and the phone number are basically unusable for verified fan afterwards. That's not a system that scales easily for brokers, and even if they scale costs them a lot to implement, which means it's only useful on things you're sure will go up quite a lot in value.
In short, it's not what I would call a lottery for scalpers.
Combined with Amex's new tour limits for amex presales (not on all tours), where they limit you to two purchases per tour per person owning an amex (doesn't matter if you have 10 cards, two orders total), and the fact that they heavily fingerprint to identify and and wedge up brokers by putting in waiting rooms, and I find the idea from the article that the primary market department of Ticketmaster is actively working with brokers at any scale laughable. It's an arms race between the people that are entirely willing to ignore the AUP and TOS (there's a spectrum here) and Ticketmaster, and has been for years.
Presumably the ticket is tied to the purchaser's id in some way (picture, name, or payment info) and at the event ticket holders need to present such information. It'd be a trade-off against people who can't make it to the event being out of luck (no way to resell), but stopping more of the scalper's bad behavior. You could alleviate the trade-off by tying the ticket to a second factor like a CC that you could entrust to a friend for the event, or allowing more refunds before a certain date.
If you throw the entire event yourself, you get to sell tickets however you want. Some bands that use TM have enough leverage to do presales or lotteries for their fans before the main sale on TM.
Most acts, at most venues, are forced to use Ticketmaster/Livenation/StubHub, because That's Just How It Works.
Louis CK made a splash a few years ago by completely avoiding ticketmaster. While a live band is very different than a stand up, I feel like if bands cared they could try something very similar.
> You win if FanDuel ever pays this bettor the full $82,610 – whether due to public outcry or any action by relevant legal authorities. I win if the bettor accepts a settlement for less, such as the tokens-of-apology that FanDuel has already offered.
They could try, but Ticketmaster owns a greater portion of the venues suitable for live band shows of any size than of those suitable for stand-up comedy, so they’d probably be a lot less successful with it. Especially if multiple touring bands tried to do it at the same time.
There's the price people are willing to pay before something is "sold out" and exclusive, and the price people are willing to pay to get access to an experience they can't otherwise get.
It's the fact that someone can press a button and get summoned to a show that they wouldn't otherwise have access to that provides some kind of dopamine rush that isn't the same as waiting in line on a website madly refreshing a page hoping for a ticket.
I agree that is one factor at work, but performers have caught onto this in the last couple of years and have started to offer a lot of exclusive VIP packages to try to capture this price-insensitive market.
I'm thinking more about mass scalping for events like Hamilton where every single ticket is bought up instantly by bots for the next four months. There is essentially no way to reliably buy the tickets at normal prices. I tried to buy tickets for Hamilton's touring show and there were hundreds of resell tickets listed on StubHub while I was still trying to get through the process of even seeing if I could find tickets myself. It was completely absurd. A significant percentage of the total available seating must have been scalped.
I've done a little work in this space tangentially in the past. The resale market is highly developed with a lot of money at stake and inventory is readily available at every price level and ticket type.
Have you ever noticed how every resale site has more or less the same tickets for sale? There are a few middlemen companies that provide the ticket inventory for any reseller to sell instantaneously via API feeds. Stubhub is in both businesses - selling to customers and acting as a middleman to other sellers. It's way more developed than most people think.
> performers have caught onto this in the last couple of years and have started to offer a lot of exclusive VIP packages to try to capture this price-insensitive market.
Artists/promoters have also started using dynamic pricing. Ticket prices might raise or lower after some presales depending on demand. Wednesday the cheapest ticket to the venue might be $49, while on Friday they've raised the price on existing unsold inventory to $69.
> I'm thinking more about mass scalping for events like Hamilton where every single ticket is bought up instantly by bots for the next four months.
It sucks that the situation is happening, but it's also very easy to fix. Either increase supply, or do something to reduce demand (like raise the price).
> I tried to buy tickets for Hamilton's touring show and there were hundreds of resell tickets listed on StubHub while I was still trying to get through the process of even seeing if I could find tickets myself.
Some of the is spec listings, where they don't have inventory yet but plan to get some, some of that is brokers/people listing items they've reserved but haven't finalized the process of buying, and some may very well be brokers, or even the venue or promoters themselves listing on Stubhub. If you're an artist, venue of promoter and you want to make more money but don't want to look likeyou're gouging your customers, and you have access to inventory you're allowed to sell yourself, what would you do? That's what they're doing.
> I've done a little work in this space tangentially in the past. The resale market is highly developed with a lot of money at stake and inventory is readily available at every price level and ticket type.
I've done, and am doing, work in this market. It's like any other, except that the ratio of good actors to those acting a bit excessively is a bit skewed for historical reasons.
> There are a few middlemen companies that provide the ticket inventory for any reseller to sell instantaneously via API feeds.
It's not that they sell instantaneously via API feeds, they just help push inventory to multiple exchanges, and help sell out the inventory in the point of sale when it sells on an exchange and remove it from the other ones. I'm sure there's software that does something similar for Amazon and Ebay too.
I've written about this before here[1], and there's some more detail in that. Specifically, I think the secondary market performs a useful function, as much as it's vilified, as explained in that link.
Iron Maiden require that the credit card and matching ID used for the original ticket purchase be presented, in order to enter the show venue. There's no scalping of Iron Maiden tickets.
Kid Rock, much as I dislike him in other ways, also has a sound strategy - "just keep adding shows until supply outstrips demand". Eventually the scalpers get tired of buying tickets that won't be sold, and his fans get face value tickets.
Now they rarely bother even trying, because they know it's the strategy that will be employed.
Wow, having worked in the ticket industry, I'm fairly impressed. This is a _real_ way for an artist to impact supply and actually fight for the ticket prices they want to be known for to their fans.
That was my impression when I first heard about it too (through a Planey Money podcast episode, which has actually covered the industry mostly fairly a couple times).
Garth Brooks is also known for playing enough at a location to usually meet demand, including adding dates. He'll start out with a single date (maybe two) where he plays two times in a day (who else does that?!), and add dates two times a day as demand indicates. In 2017 seemed to average 3 days (but 6 events) per location. That's dedication.
Scalpers solved this _immediately_ by buying Visa prepaid cards, put only the total purchase price amount on the card, buy the tickets with the card, then mail that physical card to the secondary ticket buyer...
Edit: Sorry, didn't see at first glance that you mentioned ID as well. Maybe that does close this loophole?
And the companies that do it like this almost always have a “sell it back to us if you can’t go, and we’ll sell it back on” policy. It’s hard to lose if you’re an honest fan.
The above was downvoted, but I thought of the same issue (tickets as a gift) immediately. Before I was 18, my father let me use his credit card to orders tickets for all the shows I went to. Imagine if he had to come to the venue with his credentials to get me in every time.
I also have donated my tickets to friends when a show that was scheduled three months out becomes unappealing due to illness or other unpredictable factors.
> But given the ridiculous levels of scalping that goes on every day (including all the companies that attempt to normalize it, like StubHub), doesn't it all imply that the fair market price of a lot of tickets is way higher than what they sell for? Obviously demand is way outstripping supply or people wouldn't pay $500-$1000 for $100 tickets on a daily basis.
Scalpers are the ones choking off supply by monopolizing huge numbers of tickets. A market with too few sellers gives those sellers price control. If Ticketmaster put a stop to the practice, prices would likely drop.
>Scalpers are the ones choking off supply by monopolizing huge numbers of tickets
The only way this would actually have any effect on "supply" is if scalpers were just eating tickets and leaving empty seats in the venue. The number of seats at the venue is more the "supply" than the number of tickets outstanding on the sales markets.
If a scalper was able to buy 100% of the tickets for an event, and then sell all of them at 3x "face value", then that means that the market was able to bear a price of 3x. The scalper did not change "supply" here...
> A market with too few sellers gives those sellers price control.
There isn't a set amount of supply. Artists could (and do) easily add dates, increasing supply. Many events are bought by brokers and then end up selling below cost because a date was added, and there's just not enough demand to be able to charge premiums on the face value (which is almost never the purchase cost, because of additional fees during checkout).
People usually overestimate how much the brokers affect the ability to get tickets, and how many events that happens on. There are many things that contribute to low supply and high demand, but brokers are convenient villains to point to. Artists have full control over this, and they can often easily solve the problem by playing larger venues or multiple dates, but they don't because that might cut into profits if the venue doesn't sell out.
> This is super sleezy and I think Ticketmaster is one of the most awful companies in the world. But given the ridiculous levels of scalping that goes on every day (including all the companies that attempt to normalize it, like StubHub), doesn't it all imply that the fair market price of a lot of tickets is way higher than what they sell for? Obviously demand is way outstripping supply or people wouldn't pay $500-$1000 for $100 tickets on a daily basis.
Yes, and this is the entire reason Ticketmaster exists. Artists and venues don't want to look like they're gouging their fans, so they post lower prices (with hidden fees). These then get resold on the secondary market.
How about everyone that wants to buy a ticket enters a free lottery and at the end of the week, winners are randomly selected and they then get to buy tickets. Any unsold tickets are then made available to the general public after the winners had a chance to look.
This is how the London 2012 Olympics worked, and it meant you didn’t have to try be refreshing your browser like mad the minute the tickets were released.
You need to show ID when entering the event that matches the ticket.
This is how a popular music festival does it in Germany to prevent scalping. There is no way to transfer tickets to other persons. Instead you can refund tickets up to a week before the festival which then go back into the lottery.
I mean artists are free to reserve discounted tickets for fans and sell them fcfs but they would be intentionally losing money by doing so. Sometimes this is a good choice because you don't want to make your fans mad.
It's just a system where people are incented to pay the most they're willing to. Pay before your price and you lose money, pay after your price and you risk the show being sold out.
Except it wouldn't be intentionally losing money. Long term fans are what make a band the most money - they buy tickets and merch, and albums (games, movies, etc). By cashing in on big gigs and maximizing the sales for those tickets an artist would potentially be giving up a lot more long tail revenue, and possibly killing their fan base altogether.
Maximizing long term profitability is often not the same as maximizing short term revenue.
There's an easy way to charge market prices and have them be lower. You can raise supply by playing more shows. And if a band values its long term fans, they should have an interest in getting as many people into their shows as possible. Just stay an extra night or two and play another show.
No. Rich people can allready afford a scalpers price, and dont really care if their tickets are 500 dollars or not.
In capitalism, high demand and limited stock means that you (as a seller) should set the price as high as you can, while selling all stock. If you set your price lower, you're loosing potential income
that's what makes this so shitty - promoters are setting the prices initially and ticketmaster is trying to remove their choice by removing all the stock and reselling it at the maximum possible price
What if there was a "cash back" rebate available inside the venue? So TM sells each ticket for $1000, and you get $500 back once you get inside? This would make it very expensive for scalpers to be left with extra tickets. There would still be the problem of preventing people from claiming multiple rebates but I think that's solvable.
You're right that people are willing to pay more than the current face value, but we shouldn't take the scalper prices as the fair market value either because the true demand is dramatically skewed by a group whose only goal is to raise the price to the highest number people will pay, and they do that by reducing the supply. They can buy hundreds of tickets and only list a few at a time.
I've paid $500/ticket before, so I'm part of the problem too... but sometimes we do unreasonable things when we're unreasonably big fans of a particular band, comedian, performer, etc. There's no easy solution, but it would be cool if there was a way to offer reasonably priced tickets to true fans.
>They can buy hundreds of tickets and only list a few at a time.
I don't think ticket brokers really ever do this... It wouldn't _always_ increase their profits, and would substantially increase their risk (of not selling all inventory). Not all events increase in secondary market price as the event date approaches, you just hear about when it happens for really popular events. The price is set by the demand of the fans, and with the supply of the number of shows the performer is willing to put on.
>reasonably priced tickets to true fans
Yeah, I mean, this kind of idea sounds nice in theory, but it doesn't really match up to the way capitalism works in the real world in this industry. Say you started with an environment where every event was priced "reasonably" and every seller/promoter used the same scale to evaluate "true fans" and decided equally who were "true fans". Any single company could increase their own profits over competitors by marginally reducing the acceptance bar of "true fans" they sell to, and then increasing the price point to match the increased demand they've just created (remember, supply is fixed unless the performer adds more shows). This is a unilateral action by that company, they don't need to gain the cooperation of any other entity in the marketplace, and it increases profits.
This means that the system is _not_ in a Nash equilibrium, and, without accounting for regulations or any other outside forces, the industry will naturally shift over time towards an equilibrium where no single company could financially benefit from reducing restrictions on buyers and increasing the price point. At this point they probably lose _more_ in the hit to their reputation than they _make up_ in the increased profits. So they shift towards "gouging fans" just enough to increase profits without being bad enough to reduce demand for their product and shift market price point below costs (unprofitable).
Also, thanks to lobbying from me. If I buy tickets to something and later find out I can't attend, I want to be able to give or sell those tickets to a friend.
Then require the purchaser to provide high-resolution scans of identity documents (both sides, and all pages for multi-page documents) with nothing blocked out at the time of purchase. If the scans don't match your physical documents, you are made to leave the premises.
If they are a US citizen, they must scan both driver's license/state ID/passport/military ID and social security card. If not a US citizen, they must scan their home country's passport and if they come from a country that requires one, their visa.
Also, require the purchaser to type in (not check a box, but actually type the words and disable the browser's paste function) "I swear under penalty of perjury that I will not transfer this ticket to anyone else and that I will do everything I am physically capable of to not let anyone do so on my behalf".
This is evil. Browsers should not even permit basic UI functions like paste or context menu to be overridden by arbitrary sites. Fortunately, it's not difficult to put together a script that simulates typing in the contents of the clipboard, which is my go-to solution for sites that disable paste. (Ctrl-V doesn't work? Just press Ctrl-Shift-V instead. It takes a few milliseconds longer but gets the same result.)
> If they are a US citizen, they must scan both driver's license/state ID/passport/military ID and social security card. If not a US citizen, they must scan their home country's passport and if they come from a country that requires one, their visa.
A single decent image of an official photo ID, checked at the gate, should be more than sufficient to prevent unauthorized ticket transfers. However, I would only apply this system to a small minority of discounted promotional tickets; non-promotional tickets should be sold at the fair market-clearing price, freely transferable, and usable by any bearer with no ID verification required.
> Also, require the purchaser to type in (not check a box, but actually type the words and disable the browser's paste function) "I swear under penalty of perjury that I will not transfer this ticket to anyone else and that I will do everything I am physically capable of to not let anyone do so on my behalf".
I don't understand what this is meant to accomplish.
Blizzard Entertainment has a conference every year and the height of their popularity demand for tickets far outstripped the capacity of any venue they could reasonably get.
I recall in the first years hearing of friends or acquaintances who sat up in a group and spammed the server right after tickets were posted. In later years I heard they went with a lottery system. You had a window to sign up that gave their servers a break and at the end you either got a ticket or you didn't.
Where a convention differs from a concert is that you can show up at a convention without a ticket and still participate in some fashion. You can hang out at off-site events that are affiliated, and it's common (if not entirely legal) for people to timeshare a pass, going for a few hours and then letting a friend or coworker go for the rest of the day.
The scalpers could still of course flood a lottery system, but if you make sure that only 4 tickets go to the same human (via ID or some other means) then the scalpers are limited to how many people they can get to agree to pretend to be the purchaser, and they open themselves up to identity fraud and/or theft charges if they get caught faking it.
8. Darf ich die Karte teurer als zum Normalpreis verkaufen?
Ja, der Weiterverkauf von Karten zu einem erhöhten Preis ist nicht verboten. Eine Grenze stellt diesbezüglich lediglich der sogenannte Wucher nach § 138 Abs. 2 BGB dar, bei welchem sich jemand unter Ausnutzung einer Zwangslage eine Gegenleistung sichern lässt, die in einem auffälligen Missverhältnis zur eigenen Leistung steht.
Nun könnte man annehmen, dass bei einem Weiterverkauf einer Eintrittskarte ein zehnfach überhöhter Preis nach gesundem Menschenverstand in einem auffälligen Missverhältnis zum tatsächlichen Fussballspiel oder zum tatsächlichen Konzert von Helene Fischer, den Rolling Stones oder anderen Künstlern steht und damit unzulässig ist. Dies ist aber gerade nicht der Fall, weil keine Zwangslage vorliegt, die ausgenutzt werden könnte (vgl. OLG Köln, OLGE 93, 193, 194f., wonach der um das Zehnfache erhöhte Preis für eine Eintrittskarte für ein Fussball-WM-Endspiel mangels Ausnutzung einer Zwangslage keinen unzulässigen Wucher darstellte).
Im Ergebnis kann jeder frei entscheiden, wieviel ihm der Zutritt zu einer bestimmten Veranstaltung wert ist.
but if you can cite something else I'd be interested.
There is an economics research paper that shows that ticket auctions on Ticketmaster can reduce the arbitrage profits of scalpers (https://faculty.chicagobooth.edu/eric.budish/research/Ticket...) They compared the primary auction price to the ebay resale price and found they were about the same. It's unclear why ticket auctions never took off, although it may be that the only work well for shows with high demand.
You would end up massively favoring the wealthy fans, who have a lot of disposable income, leaving less fortunate fans with basically no chance to get tickets.
The solution is to either make tickets non-transferable or make it illegal to sell tickets above face value.
Not everything needs to hit a perfect profit ratio.
Exactly, it's not always about maximizing profit. Artists also to play for their fans. This is one of the main reasons artists have fan club email lists, to let actual fans get first go at tickets before the public sale date. Of course, there's nothing stopping scalpers from signing up.
I mean couldn't you just solve all this by tying a ticket purchase to a name, and make them non-transferable? Can't sell a ticket if the buyer will have to provide your ID.
I think the ticket should be matched to a government ID or passport. Drivers licenses have barcodes on them. Sell cheap tickets that rewire ID and sell "unlocked" tickets for 2x as much.
Paying $500 for a ticket is conspicuous consumption, and I have no problem at all with Ticketmaster, or anybody else, gouging people as much money as they possibly can.
The problem I have, is that most of these facilities are publicly owned, while the team is a for-profit adventure, and thus heavily subsidized under the fake notion that it's good for the community, when in fact the community is being screwed over. If this were really anything approaching free market, there'd be none of that. But the massive public subsidy is why there's downward pressure on ticket prices and why you see scalping.
I suggest looking for junior clubs, college games, or one of many pro sports leagues you've never heard of (lacrosse, rugby, arena football). I pay $35/game for 4th row from the glass seats at one of the best college hockey teams in the country, and it's way more interesting than NHL hockey where that same ticket would cost $250.
Right, it's not conspicuous consumption to pay more vs less for the ticket, since almost no one observes the purchase. Now, attending the event is conspicuous consumption, but the specific amount you paid is irrelevant to that, except to the extent that people in general know you have to pay a lot for the tickets.
Freakonomics did a great deep dive [0] into the complexity of ticket markets. The short of it is that incentives are mixed and spread through the following parties: sellers, venues, promoters, artists, and fans.
Artists don’t want to look like they gouge their fans.
Promoters take a cut and need to hit volume milestones.
It's kind of unfortunate. I am perfectly willing to allow the artist to gouge me. If 2000 people want to see the concert and there are 1000 seats, what choice do they have? Sure, next time book a bigger venue, but this time... you just have to let people bid on the tickets and sell them to the 1000 highest bidders.
I feel like I've always gotten a good deal on the secondary market. Every so often I am in Japan in late August and like to attend a 3 day anime song concert. The tickets are sold way in advance, and are $60 (ish) for a randomly selected seat in Saitama Super Arena. This means your $60 may get you a front row seat or one on the upper balcony behind a pillar, you don't know. And you have to physically buy the thing from a convenience store in Japan 6 months in advance. So the primary market is just bad. I end up just buying tickets on Yahoo Auctions and for $200 I get a front row seat. Would I have been just as happy to give that $200 directly to the people running the event? Yup! But they don't let me, so they lose out on $240. Multiply that by thousands of tickets sold, and you wonder whether or not any of these people ever attended business school.
Similarly, you can get reverse gouged on unpopular events. My brothers are big basketball fans. Whenever they visit New York, we go see the Nets play. The Nets are historically terrible and never fill up the arena, but apparently they sell a lot of tickets for corporate events. These tickets end up on the secondary market for reasonable prices, and that's what I buy. The list price can be something like $1000 and yet we buy them for $100. (I also enjoy the banter with the coworkers of the people that sold us their tickets. Every time, it's "I can't believe so-and-so sold their tickets!" But people are drinking and you can't take yourself too seriously and be a Nets fan, so it's all in good fun.)
Anyway, kind of wandered off topic... but the only way to make demand meet supply is to gouge people, so that supply falls to exactly meet demand. The artist deserves the money, not middlemen.
> If 2000 people want to see the concert and there are 1000 seats, what choice do they have? Sure, next time book a bigger venue, but this time... you just have to let people bid on the tickets and sell them to the 1000 highest bidders.
They do have some choices, at least when venues will cooperate and the government doesn't interfere on behalf of businesses with competing incentives. If the performer wants to make sure every fan has the same chance of purchasing a ticket at the list price, then checking ID when picking up tickets is probably the easiest policy. This has downsides, of course, like preventing sales if someone gets sick or has last-minute scheduling conflicts.
Perhaps a better idea is to have a ticket lottery with measures to prevent bots from flooding it and nabbing most of the tickets for resale. Ideally, each human who is interested (whether they want to attend the event or resell the ticket) would have the same chance of being able to purchase a ticket. I believe sites like Ticketmaster make some attempt at implementing this, but I have no idea how effective it is. It's probably effectively impossible to detect bots.
Personally, I won't bother going if I have to wait in line for my ID to be checked. At that point, it's a chore, not something fun to do. Maybe I'm the only one.
The real strategy is to just change your name to "John Smith" to maximize the probability that you can sell your ticket to someone, at least until they start checking your birthdate and TSA Known Traveller Number.
Right? This whole thing comes down to the most basic of economic questions: "How do we distribute a scarce resource where demand is greater than supply?"
We have an amazing system for this - a market. Why don't we just accept that price is based on supply and demand and let the market (secondary markets included) determine the price freely.
So? If artists want to control the experience perfectly, don't sell on an open market. There are ways to prevent the majority of resale (will call, purchasing credit card required at gate, etc).
If artists really care, they would do more than lip service (some do!). When they don't, the message is clear. They might care, but they care about money more, because let's be clear, brokers buying out a venue within a day that might take a few months to sell out is good for the artist, promoter and venue. They get to offload risk to a broker, for the cost of possibly some more money in the long run, and they get all their money up front and can do what they want with it for that time.
Uh there are many reasons. Artists desires are typically mediated through a promoter or a promoter and a venue and the contractual obligations of both. For instance if the only appropriate sized venue is a live nation venue then you're using ticketmaster! if it's one that has an exclusive contract with ticketmaster same thing. You often can't just "get a different venue" because for various sizes of venue there are only so many in a city, even fewer that are correct for your show, and that are available.
> for various sizes of venue there are only so many in a city, even fewer that are correct for your show, and that are available.
"Correct for your show" is what I'm talking about. It's realative based on what your goals are. If you want to make sure fans get cheap tickets, you make sure supply isn't too far under demand. That can be adding a date, or playing a larger venue. That's risky, because if you misjudge demand, you might actually lose money (based on venue minimum costs).
So, artists and promoters like to ensure they are sold out whenever possible. To achieve this, they play it conservative, but that leaves value on the table. Brokers capitalize on this. If the artist or promoter was more willing to increase supply and take that risk, fans would benefit. Usually, they aren't. Sometimes, they are. Kid Rock and Garth Brooks are notable here. Garth Brookes will play a venue three days in a row, twice a day. Kid Rock might just book 6-7 days.
Assuming artists could predict demand and supply (versus spending time creating music), if they become popular, with this simplified logic they should only play large venues (which Live Nation controls) on back-to-back nights in primarily big cities. And if they were mainly concerned about money (which some are) then they'd only play the largest cities every year. There are only so many tour days in a year, how would they split their time?
That's not a music culture I'd want to be part of.
> Assuming artists could predict demand and supply (versus spending time creating music)
I assume they pay people that are good at this to do it for them.
> they should only play large venues (which Live Nation controls)
Not all of them. Most, but not all.
> And if they were mainly concerned about money (which some are) then they'd only play the largest cities every year.
For the most part, I think you just described the concert industry as it currently exists. Usually, the only thing indicating whether an artist will book theaters, arenas or stadiums is how likely they are to sell it out. Only the biggest artists can do stadium tours.
This is not about maximizing profit, it is about distributing a scarce resource. The simple fact is that not everyone who wants to go to the concert is going to be able to. How do you decide who gets to go and who doesn't?
How would you design a system to do this? All of them have a ton of flaws, but I have yet to hear a system that can beat a market.
Given how frequently they ran out of 65,000 tickets for <enter_any_big_ticket_event> within seconds (which would pop up under resale with > 200% markup minutes later), glad this is out in the open.
Also, Fenway Park is the worst. Had a terrible experience earlier this year while trying to book Pearl Jam tickets. Presale went live at 10:00 AM on February 10th (for shows in Sept) and they ran out of tickets at 10:01 AM, are you kidding me? Suddenly I see spike on StubHub an hour later with ridiculous markups.
Fortunately my Uber driver pointed out and suggested that I wait until day of the event (as fenway park puts up unsold scalper tickets back online at market price). I followed his advice and snagged couple of tickets on day of the event at market price as he suggested.
The whole experience was mind numbing.Can't wait for Amazon tickets to disrupt this space and drive 'em out.
Edit : When I said 65,000 tickets - I'm counting Pre-sale tickets as well including Verified Fan scheme they had going this year.
I've noticed sometimes during the rush, the Ticketmaster app will report no seats available, but the website (sometimes after a few refreshes) will have seats, and vice versa. I had to refresh for probably 30 minutes the last time I bought Dave Matthews Band tickets, and ended up with pretty good seats.
> Given how frequently they ran out of 65,000 tickets for <enter_any_big_ticket_event> within seconds (which would pop up under resale with > 200% markup minutes later), glad this is out in the open.
Well, a lot of that is because more and more tickets are sold during presales (passworded or not, such as Amex presales). Sometimes there's less than 10% of inventory available on the regular sale. Sometimes there's more, but they hold back a few thousand to drop on the market to sell later.
The majority of stuff you see on Stubhub within minutes might have been listed on Stubhub for a day or two, or been primed to be pushed to stubhub at that moment for a day or two, since they were bought previously.
It's not hard to get access to most presales. If you have an Amex, you're already qualified for one of the earliest presales they have on most events. Same for Citi for some venues. Other than that, you can sign up for fan clubs to get passwords, or just search around.
> Presale went live at 10:00 AM on February 10th (for shows in Sept) and they ran out of tickets at 10:01 AM, are you kidding me?
Alternatively to what I said above, sometimes very little is released in a presale. It's a crap shoot, and depends on the tour strategy.
Yes, brokers will buy. Sometimes they over-buy too, and you can get tickets cheaper (this can be fairly common, actually). I'll tell you this, regardless of what this article says, Ticketmaster is always rolling out new mechanisms to make it easier for fans and harder for brokers. Recently they started using new queue systems for some sales, and a new ticket buying interface, as well as much more complicated bot detection heuristics.
Ticketmaster has multiple divisions. The secondary market division (TM+, their new Point of Sale offering) might not necessarily want brokers excluded, but the rest of the company must put a lot of engineering effort into it, given what I've seen. That they don't go seeking out accounts makes sense to me, because there are legitimate reasons to buy a lot of tickets (corporate bonus gifts, a concierge service, etc), and inaccurately targeting one of those will cause a lot of trouble, and maybe even a court case (if I was a concierge service with a few hundred tickets in their system, and they cancelled them all, I would consider a lawsuit because they've had my money for months and been able to capitalize on it, and if the alternative is a crippled business...)
> The whole experience was mind numbing.Can't wait for Amazon tickets to disrupt this space and drive 'em out.
It's a market, with supply and demand. If you think a new entrant will change anything, I'm sorry, but I think it's unlikely. There's already multiple ticketing companies, Ticketmaster is just the largest. AXS ticketing does some large venues as well.
I bought 1 concert ticket from Ticketmaster that cost $45. My final total was $72. They charged me 60% extra in 'processing fees' for something I could have just printed out. How much 'processing' does it take to display information on a web page?
They also don't let you just print the ticket. I had to pay extra to have a physical ticket snail mailed to me.
Paying 60% of the cost of the product just to help the company continue to justify their existence is freaking ridiculous.
Part of Ticketmaster's purpose is to allow the artist, promoter and venue to charge extra but in a way that shifts blame to Ticketmaster. They are wildly successful in that, as evidenced by the number of people that bring up this exact point.
If you look at the fees, often there's a "venue fee" and other ones. They are different per event, but often are similar per tour and per venue... which means it's being set by artists, promoters and venues. It's trivial to show all-in pricing (some events have it turned on, so it's what you actually see on the main page). They don't do so on purpose.
I hear this a lot, and it might just be me, but I'd feel better about a $50 purchase where the $50 dollars all go to the artist/venue, vs a $50 purchase where $30 goes to the artist and $20 purportedly goes to Ticketmaster.
Except a vanishingly small number of tickets for popular events are even going for $50 any more, and how do you feel with the ticket costs $95 but you're actually paying over $20 extra for it? Sticker shock is real. Avoiding a $115 ticket price helps avoid some of that outrage. Here's a case study:
The last couple weeks Paul McCartney went on sale in a few places. At PNC Arena[1], the the prices for standard tickets were as follows[2]:
That doesn't look too bad, until you consider that the lowest price offer, which is just over $41 all said and done, but there were only about 250 tickets at that price level releases, for a venue that holds about 20,000 people. That's just over 1% of capacity.
Less than 1,000 tickets of the $65.50 price level were released (and you had to pay $84 to get them). Less than 3,000 of the $95 price level (almost $116 for those) were released.
Now, I'm not sure exactly how you interpret that, but I suspect I know why they put put in a very low price level but didn't stock it with much inventory, and it wasn't to make sure deserving fans got a chance. It does conveniently allow them to to say that brokers grabbed all the cheap inventory in the beginning though...
That's not to say every artist does this. Some provide quite a large amount of low priced tickets, but the trend on that is down, not up, from what I've seen.
We tried to buy tickets to Some Big Thing earlier in the year, and they’d sold out. They were, however, available on Ticketmaster Resale.
In addition to the bumped cost of the ticket, there was a AU$50 - FIFTY FKN DOLLAR - Ticketmaster fee! They’ve sold it, and now to help a scalper sell it again “officially” they’re putting a $50 fee on!
There’s no way I’m giving those dirty thieves that money. I didn’t, and I wrote to my MP to say that something should be done. It’s a fucking disgrace.
To make this worse, in all likelihood the scalper was fake and it was not sold out. Ticketmaster will routinely pretend a venue is sold out when it's not and they're not shy of impersonating a third party either.
A percentage of those fees still go to the artist/band/show, it's just another way of hiding the true costs behind these services and what their take is.
I wonder when we are going to see a startup do to ticketmaster what Uber did to cabs. They are asking for it with their escalating shitty rent seeking behavior. Unfortunately, due to their stranglehold on most venues in the country, they seem to enjoy more power over their industry than even the taxi lobby did.
The difference is that people disliking Ticketmaster is actually a feature of their brand. The vast majority goes to the artist, but Ticketmaster takes a lot of blame for high prices, and everyone wins.
I would say less on the artist side and more on the sports side. Artists at minimum pay lip service to prevent scalping and some appear to at least try and avoid scalping (by requiring cardholder to be present for example)
Edit: also want to add that no one thinks Lebron James is having a hand in setting ticketing policies whereas Taylor Swift probably has someone asking for her input
Eh, I don't know how much of a say artists have either. Back in the '90s, Pearl Jam tried to get the price on their tickets down and ended up canceling the tour and pursuing antitrust charges against Ticketmaster.
It's more of an open secret, like the way certain terms are obscured by EULAs. The information is there for anyone who wants to look into it, but most people don't care or don't have the incentive to investigate. The important thing is to have a buffer to make certain details less obvious to the majority of customers without appearing dishonest.
Ticketmaster has exclusivity contracts with venues. You cannot bypass them unless the venue and ticketmaster want you to. The very nature of the exclusivity contract prevents your startup idea. Unless they are also scalpers in good graces with ticketmaster, there's no tickets for them in the first place.
In the UK TicketMaster own many venues. They even own the companies that run the concerts too.
For example in Scotland the main company that runs all the 'big' events is DF Concerts & Events who are owned by LiveNation who themselves are partially owned by TicketMaster. They also host festivals like 'T(ennents) in The Park' and 'TRNSMT' and own their own venues like 'King Tuts Wah Wah Hut'.
LiveNation also own many venues around the country.
Basically you're stuck with them.
I find it's relatively easy to get tickets though. Presales (through Spotify, DF concerts themselves ('gigsinscotland.com' and Spanish/Telefonica owned telecom company O2) or just being fast on the website is normally good enough.
There are other companies in the UK that run ticketing sales too. SeeTickets is quite big and the Ticketmaster owned TicketWeb. Both give better chances of getting tickets.
That's part of the issue but the bigger than venues, was the merger between LiveNation and Ticketmaster, that congress decided to approve.
LiveNation is the promoter of every major artist and tour. When that merger happened Ticketmaster gained the ability to basically block any Arena Size artist of going on tour if they weren't using Ticketmaster.
The thing is, that the concertgoer isn't Ticketmaster's customer really as they see it. The venue is who they see as the customer as they are the ones who pick which ticketing agency will be used. And venues actually tend to like Ticketmaster overall.
EDIT: Also, I'm going to throw out there that I've heard rumors in the industry where if a venue doesn't get the percentages they're looking for from the artist, they'll scalp the tickets themselves obfuscated slightly.
Competitors show up once in awhile. If they see anyone with improved technology, they buy them. Otherwise, they have the market power to box competitors in.
The only way they will ever lose is if some sort of regulatory action made it impossible to get exclusivity agreements.
Taxis are the most overrated cartels. In most geographies taxis were just conduits for Medicare/Medicaid money who also gave rides to drunks and to the airport. Ticketmaster has more control of the market, and has it on a national scale.
I hope it happens, but there's been more than one startup out to take on the ticket resales issue that ends up drowning in their own obscurity. Some Stanford 20-something who's been robbed on a markup or some exorbitant fee inevitably shouts "BLOCKCHAIN!" in the same sentence as "ticketing" and nothing comes of it.
ticketswap is a start. Most ethical ticket platform I've ever experienced and for multiple transactions.
Granted it's for reselling but to me it's the same because approx 4 out of 5 times, I have waited to buy tickets expecting to be able to buy them reasonably priced there and succeeded. I like to think of it as other fans selling them there but I could be wrong. Just seems like people trying to recoup the face value +/- 20%. Never seen more of a markup than that.
It's more likely to cause government and society pushback if a startup can't compete against the disliked behaviour, shooting themselves in the foot in the long-term for short-term gain.
I think you need to use basic supply/demand economics; the original sales price needs to be near the limit people are willing to pay scalpers. There's no secondary market if the scalper needs to pay near the maximum value of the seat. The entire legit reseller market is just TicketMaster trying to get a piece of the pie that the promoter left on the table.
There's a misalignment of incentives for most events. The performer gets paid for the show regardless if there's one attendee or it's a sell-out (some acts do share in gate and/or merch). They want the lowest ticket prices. The promoter is on the hook for a lot of fixed costs so they need to sell enough tickets to break-even; everything beyond that is profit from selling more tickets or higher prices. The venue gets rented but then TM "offers" them a per-seat fee in exchange for exclusivity. Then TM gets big processing and assorted fees for every act. Then resellers, legit or not, buy blocks of tickets that they resell in a dynamic market, prices floating based on demand and timing. Now we have TM coming back and saying "we'll offer you a marketplace and make it easier for you to secure supply (via bots and other shady processes)".
Tickets are associated to a name at purchase; you are then required to provide corresponding ID upon admission at the event. Very similar to non-refundable airline tickets (which was designed to kill the secondary market for airline tickets [1]). If you cannot attend, your ticket expires worthless.
Trent Reznor of Nine Inch Nails fame has been doing this as part of his fan club for over a decade, and is a vocal opponent of scalpers [2].
Add a marketplace for resells to same place face value tickets are sold. Would be same site, but could be different pages or w/e. Cap resells at face value, removing incentive to flip.
Then to prevent resells, would need an app with ticket barcode that changes over time, like most 2 factor auth apps. This should help prevent resells via printing and screen shots. I expect that's not foolproof, but could prevent the easiest alternative market. This would work offline too which is a plus since service at big events is generally bad. Could also make transfers as easy as venmo through the app.
The whole idea is to remove incentives from resells and make it easy as possible for people to transfer legitimately.
I know that they did this in the United States. But one of the interesting things that is helpful for investigative journalism in Canada, the entire country is a one-party consent jurisdiction for recording of phone calls, and recording of conversations in person. investigative journalists in Canada have taken advantage of this fact for many years, and exposed a great deal of corruption.
I enjoyed reading the email chain linked from the article. Ticketmaster sent CBC the usual PR statement, CBC replied saying "we are going to say you declined to comment if that's your answer to our questions" and Ticketmaster replied that that's unfair and they were perfectly happy answering all the questions... off the record. Wow.
It's amazing how long this ticketing scam has continued, and so blatantly. Everyone knows it's a scam!
They even managed to make settling a class-action lawsuit into a huge fucking scam. It's infuriating. I feel like they should be sued for the way they settled the lawsuit.
What do you mean ticketing scam? Scalping? If so, I'm confused on how you might stop it without allowing people who can't go last minute to resell their ticket. This feels like a damned if you do, damned if you don't situations.
Also which class action lawsuit are you talking about
This is a professional reseller program. It's not about individuals reselling tickets last minute. This is specifically about squeezing more money out of average customers using scalping methods.
Sorry for being vague about the lawsuit/settlement, it's just enraging that ticketmaster has been so shitty for so long... yet my options are still generally:
1. use ticketmaster
2. don't get tickets
The settlement was: http://settlement.livenation.com/ — in which Ticketmaster ended up giving tons of borderline _unusable_ vouchers to customers in settlement (the lawsuit was over fees and took a decade to reach settlement).
You have to sit and watch their site for specific availability to generally lower-tiered events and hope you're fast enough to actually get the available slots (you're competing against millions of people who also have vouchers).
Hey at least I could use the IOMega voucher, I used to go to a lot of shows so I have like 50 worthless Ticketmaster vouchers from the lawsuit. Sometimes I get like $2 off a ticket, but the vast majority of them will go unused.
When I see ticketmaster selling tickets for an event, I know it's not going to be worth my time, money or effort trying to go.
There are a ton of venues and artists out there. If you're put off by this action, understand that this action is taken by TM, the venue and the artist, and vote with your wallet. Spend your entertainment dollars elsewhere and support artists and venues that are more honest. Find a club that sells tickets with some other company or where you can buy tickets at the door.
Why aren't ticket sales an auction? That would allow Ticketmaster and the promoters (and hopefully artists) to extract maximum value for each ticket. It would simultaneously take all the profit out of scalping. Tickets could be exchanged at face value, but if the maximum value the market will pay is already extracted there will be no margin left for resellers.
Because many performers want their concerts to be accessible to their broad fanbase, and this is probably better for their bottom line in the long run, since there is sure to be animosity towards a popular performer once fans discover that only very rich people can attend their concerts.
If that's the goal, then active measures to deter reselling tickets should be used. Thom Yorke succeeded at this when I saw him earlier this year. All tickets were Will Call and you had to enter immediately after ticket pickup. Selling tickets in a way that puts fans in direct competition with well-resourced resellers doesn't help fans either.
I worked for Ticketmaster back in the early 2000s and helped build an auction platform for them. Some artists did use it for the highest quality seats, and a few even did it for the entire venue, but many artists were afraid of it because they felt like they would then be the responsible party for 'squeezing' their fans. Perhaps the idea that they would get the money along with other people running the event, as opposed to scalpers didn't resonate. I wasn't around when the platform was decommissioned so I can't say for sure all the factors at play but, for sure many artists didn't like the idea.
I had no idea Ticketmaster had such a reputation for being consistently sleazy until I read all the comments here. They scammed me once and I thought it was an isolated screw up that they just didn't want to own up to.
One would think that review sites, etc. or the BBB might do something about companies like this, but even companies I always have good experiences with have some disgruntled former employees or customers trashing them online, and I've never known the BBB to do much. What's one to do? Are there sites for feedback on companies like this where it's not just paid shills and disgruntled people?
This doesn’t hurt ticket buyers as much as it hurts artists and producers. It’s they who get payed less from Ticketmaster, the consumer would have to pay market value anyway.
What they should really do to get market value ethically is simple, have an auction for the tickets. The going price would be transparent to buyers, artists/producers and Ticketmaster wouldn’t have the ability to doubly collect fees without paying the artists/producers their real cut in the end. Of course you could argue Ticketmaster would have the ability to benefits from resellers anyway, but in reality the price difference the second time would not be big enough to be benificial for scalpers and Ticketmaster.
If the band/artist want to give more to dedicated fans, just set a side a set of tickets for their fan club and let them buy for a flat fee or from a private auction.
anyone else get a bunch of free tickets from ticket master in that lawsuit a few years back but then realize that basically none of the concerts are eligible ?
Maybe this will finally get the FTC to pay attention to ticketmaster/livenation. It's been one of the most abusively anticompetitive companies out there for decades, blacklisting venues that don't use it for everything and setting ticket price requirements (and then of course charging bigger fees because of it).
It's insanely bad monopolistic behavior the FTC never appears to care about, I dunno, maybe because it's just entertainment or something.
This industry can only exist because labels and artists are not willing to sell tickets at the market clearing price, since they would be seen as exploitative by their own fans. So they sell the tickets are significantly discounted prices, in the hopes that at least some of them end up in the hands of the fans, saving face but creating a niche for a super-sleazy industry.
The solution I believe is to directly engage the fans and include with the price of the ticket benefits that only have value for fans. For example, when purchasing a ticket the market price is $100, out of which $40 is the price of the ticket and $60 is the "anti-scalping deposit" that fans get back when purchasing from their account with the band's site. So you would get $60 back in your account that you can use to purchase items valuable for fans such as limited edition CD, merchandise or even other tickets in the future (this is a bit tricky since scalpers can automate it, but exposes them to a major risk of detection and loosing the deposit, unlike the automation of the single ticket purchase, which either works or is risk free).
Providing this service seems like a nice idea to build a company on.
LiveNation often offers the artist guarantees for the tour up front. This is great for artists as the risk it transferred to LiveNation. LiveNation then extorts the fans via Ticketmaster.
Ticketmaster becomes the scapegoat, but since they're a near monopoly with a one of the worst public images it makes no difference to them. The artists also take a piece of those "convenience charges" that often make up a large percentage of the face value of a ticket. Again Ticketmaster takes the heat and everyone wins except the fans.
>> "This is going to be a public relations nightmare."
Lol. Does anyone think tickermaster cares one iota about its public image? They have been hated for decades, by fans and artists alike. The survive on their ins with venues, bulk purchasers, and CC companies.
So, my problems with this article, as someone that works in the industry:
1. It's not a secret. It's Ticketmaster's secondary market division, TM+. They may not advertise where people out of the industry would see it, but that's nothing special. They may not want to draw attention to themselves, for reasons such as this article, where they are portrayed very unflatteringly and given little chance to provide their own context. Tradedesk, their new POS offering, is new, and has been somewhat buggy (most might be worked out now), so they've targeted known brokers, but it's a free tool, so they would probably be happy to have anyone that buys and sells more than 1-2 sets of tickets a month (there are a LOT of people that do this as a little extra income, or to pay for their concert habit).
2. Ticketmaster has multiple divisions. The division responsible for proving primary market tickets and the division for running Ticketmaster's secondary market are sometimes at cross purposes. I can tell you from experience though, Ticketmaster does a LOT to prevent the more egregious use of bots, to the point where it can bleed over to regular fans. Every few months there's some new site feature that makes bots harder to utilize. Recently it's a new queuing system and new purchase mechanism, where you select seats off the map (which they've had for a long time, but not during sales).
3. Distinguishing a broker account with 100 purchases on it and a corporate account for bonus gifts or a concierge service may not be as easy as it sounds. It's also not that hard for a broker to just use an account for a few purchases. If I was running a concierge service and Ticketmaster cancelled hundreds of purchases all of a sudden, I would be a bit peeved that they took my money (credit, most likely) for months and then basically killed my business because they incorrectly identified me as a broker account. Also, artists/venues/promoters may not actually want to you cancel tickets and put them back on the market. Being sold out has it's own benefits (and nobody wants to return cash they've already gotten).
4. One of Ticketmaster's main purposes is to offload anger about pricing from artists, promoters and venues to a separate entity. There's a reason why there are often over 50% additional fees per ticket (and they are higher for higher costing seats, how interesting...). It's because many of those are set and received by the artist, promoter and venue. It allows for pricier tickets which is hidden up-front, and the blame goes to Ticketmaster. Ticketmaster of course tacks on their own fees for this service.
5. I believe the secondary market provides a useful function (otherwise I would seek other employment). It helps artists, promoters and venues offload risk (up-front usable money now, instead of little by little as the tour goes on), it helps spread tickets to those that have more money than time (people that devote time still often get tickets, brokers very rarely get everything), and it allows fans to get tickets well below original cost in some (fairly common) cases, such as when a tour is overbought or demand lessens as it goes on. I could find any number of events with secondary market tickets under primary market cost at any moment.
In the end, it's a market. There are tried and true ways to alter it if that's what you want, but for the most part, I think most people are happy with how it works, and happy being able to complain about the time is doesn't as well. Fix and/or make an example of the market participants that are too greedy (such as the broker that got in trouble for buying ALL the Hamilton tickets), and it mostly functions in a way that people expect and find useful. I'll tell you this, getting rid of brokers (if you could) wouldn't result in much cheaper tickets. A lot of the money left on the table would just shift to other market participants, and I doubt it would be the fans.
This argument is repeated over and over again, but i just cant imagine that being right. This is not usually how efficient markets operate, taking into account all the subjective brand appreciation. I can believe that Ticketmaster can shame any artist outside ticket master, or some other network effect, but not that hating ticketmaster, and deteriorating the user experience, is the economically efficient way to do it.
> This is not usually how efficient markets operate
Efficient markets assume clear information that is known by all parties, which make rational decisions. We're talking about a luxury entertainment purchase based on subjective taste in music, and how people feel about those performing that music.
> I can believe that Ticketmaster can shame any artist outside ticket master, or some other network effect, but not that hating ticketmaster, and deteriorating the user experience, is the economically efficient way to do it.
Either you didn't understand what I was saying, or I'm not understanding what you're saying. It's not about Ticketmaster shaming artists, it's about artists not wanting the negative attention and feeling that high ticket prices attract, and offloading some of the price to a third party (by having them collect additional fees) to manage this.
> it's about artists not wanting the negative attention and feeling that high ticket prices attract, and offloading some of the price to a third party (by having them collect additional fees) to manage this.
I'll try to rephrase. This would only work if the artist selling the ticket by themselves could only sell it lower than Ticketmaster. That is, Ticketmaster can extract MORE money out its customers because they hate Ticketmaster.
That is the idea I contest: people pay more on satisfaction, not on dissatisfaction. Yes, the artist save themselves some hassle, but they dont reduce it, they increase it. I would believe Ticketmaster has some leverage we are not considering.
A thought experiment: lets say artists now sell their tickets on platform independent and simultaneous to Ticketmaster, at the same total price. Would people buy on Ticketmaster because they prefer to hate it than to hate the artist?
> That is, Ticketmaster can extract MORE money out its customers because they hate Ticketmaster.
This is what's happening. People want to see the artist they like, so they see Ticketmaster as a necessary evil. If those feeling were transferred to the artist, the artist may alienate fans, which not only affects that specific concert, but future reputation and events as well. This should not be looked at one event at a time in isolation, reputation persists, and pays of in a myriad of ways (album sales, word-of-mouth, etc), so it makes sense to look at it over time, If an artist is able to cultivate a reputation for caring about fans, it helps to have a partner able to take any blowback for actions fans do not like.
More established artists often just charge a lot for tickets. They can get away with it. Having to pay $100+ for the cheapest Rolling Stones tickets isn't going to phase most Rolling Stones fans at this point (and a lot are at a stage in life where they can support it, and much more expensive tickets). The same might not be true of a newer artist, which is still trying to grow their fan base.
> people pay more on satisfaction, not on dissatisfaction.
Generally, yes, but it's also skewed by how often the item in question is purchases, have they purchased it before, etc. No matter how much I enjoy a new car, I still hem and haw at the price when I an seriously considering buying one. Expensive luxury purchases are like that (at this point I do pay for satisfaction in cars - to a degree - but it wasn't always that way, by necessity and by my current state of knowledge).
> lets say artists now sell their tickets on platform independent and simultaneous to Ticketmaster, at the same total price. Would people buy on Ticketmaster because they prefer to hate it than to hate the artist?
Is the artist advertising a similar face value and adding fees on to create a higher purchase price, like Ticketmaster? If not, then I expect the vast majority would probably end up at Ticketmaster because of a lower advertised price, even if it's the same at checkout.
In the end though, some fans may be upset at the pricing and treatment, and that may prevent a future album or concert ticket purchase. Fans are fickle, and there's a relationship between artists and fans, and that's essentially why it's not a rational market. There's emotion in there.
> Is the artist advertising a similar face value and adding fees on to create a higher purchase price, like Ticketmaster? If not, then I expect the vast majority would probably end up at Ticketmaster because of a lower advertised price, even if it's the same at checkout.
Lets try to ceteris paribus it. I have no doubt the price shennanings Ticketmaster does have an extractive effect, but given the same price for TM and the artist, who would choose TM? And if the artist is cheaper because there is no middleman?
Of course TM would punish any artist doing that, thats why I say they must have leverage.
In the end I might be wrong about this, but deception is a poor substitute for economic efficiency. The day one artist collects more money with no fuss, the house of cards falls down.
I could be, but then again, I think that audience then doesn't really understand what's going on, and how it's not as clear cut as they think. For one example of that, see this[1].
Ticketmaster is also largely pushing behind the scenes for digital only / digital first ticketing.
The experience of being gifted tickets for an event is no longer the same.
A side effect of this is that Ticketmaster alternatives (Stubhub) etc, are also better frozen out of the secondary ticket market, and ironically, Ticketmaster takes their place through their fan-to-fan resale platform.
TM has acquired Stubhub as well, so there are likely other competitors/targets they are targeting too.
One of the few blockchain companies I actually see the value in is https://guts.tickets Their technology prevents reselling tickets for anything other than the original price, among other things.
(Disclaimer: I just happen to know one of the founders from a past endeavor, I do not own any of there token)
This is exactly why we built rystband! We're an all digital ticketing company so we can do what the big companies can, but better. We sell tickets with $0 service fees, forever. Check us out! https://www.rystband.com
Artists/celebrities keep using it (i'd even want to say endorse it). Customers keep buying from it. Unless politicians pick this up and do something like condemn this practise and threaten regulations, nothing will happen.
The dark side of this is how they damage the total sales in their "explorations". The actual performer doesn't get a cut. They don't get to know their market value, or how bad the pricing hurts the fan experience.
If Favorite Artist comes to town to play, you will buy a ticket because you love the artist. Whether the ticket handler is a piece of shit is inconsequential.
excuse my ignorance but why can't artists just setup a stripe page and collect money from fans and set up a location and date? why are market makers needed in tickets market that create incentives for scalpers?
It's because the venues are the ones partnered with these types of companies. Unless the artist themselves own a venue, they usually have to go through the ticketing of whatever that venue itself uses. The artists sadly don't get that much control on that type of thing, esp the average artist that doesn't have the type of "klout" to demand X Y Z happen for them to play that venue.
I bought my son a ticket for a music festival that was sold out within hours of ticket release from ticketmaster's reseller site seatwave and paid triple the price to some guy with an Indian name who I'm fairly sure never had any intention of attending.
By making all event tickets available at exactly the same time for an effectively-lower-than-market price, of course professional scalpers are going to snap up almost all of them and normal people without scripts won't be able to compete. I wonder what would happen if tickets went on sale for a really high price (like $500 each) and then the prices kept dropping automatically every hour until they were all sold. That would kill a lot of advantage that the scalpers have.
I guess customers would hate it and promoters would hate it, but I wonder if there isn't some other kind of sales model that would make this kind of sleezy self-scalping less profitable. Because with market forces this strong, companies are going to do anything that is legal-ish to get a piece of it. If Ticketmaster doesn't figure out a way to get a piece of the massive resell market, they are essentially just giving away free money to StubHub (from their point of view).