Ticketmaster is sent to the principal's office

From Lefsetz:

And we thought it was all about the fees...

But it turns out it's about process and transparency.

The public can't figure out ticketing, and neither can the government. And that's exactly the way the music business wants it.

There are pre-sales, holdbacks, platinum... And on the general on-sale there can be fewer than a thousand tickets available in an arena. And you wonder why the public is frustrated?

There are going to be fees on the Zach Bryan tickets. Ten to twenty dollars. And honestly, that's not cheap, that's not bupkes. But you know what they are, you're not going to be surprised with a crazy number when you go to check out on the ticketing site.

Zach can't get rid of the fees, because that's promoter profit, and the buildings get a piece, and of course the ticketing company gets a piece... Because the acts take all the rest. The fees were created to establish a pile of money that the acts couldn't commission.

And the ticketing company, which does not get all of the fees, as per the above, is paid to take the heat, so the act looks good. Without the fees, the whole business does not work. Or would have to be restructured, and good luck negotiating with agents to do this.

So that's the fees.

Per Lefsetz:

This makes me crazy. I was just on a radio show about ticketing. Of course they gave most of the time to the college professor economist, who understood the facts but missed the point.

How come every business is seen as professional except for ticketing? People don't understand medicine, nor do they understand Wall Street finance, those are seen as professional businesses, but ticketing? Oh, those are inexperienced idiots, we could do it better.

We can delineate the splits of the fees, which most people still don't understand, but they don't get to the heart of the business, the history, and the fact that THE ACTS TAKE ALL THE MONEY!

But in order to make the business work, there must be promoters to pay them. So how do those promoters get paid?

You see the acts commission the monies. Never mind that they get steep advances. The fees are outside the commission base. That's where promoter profit is. Get rid of the fees, and you've got no concert business.

As for including the fees in the overall price... Stubhub did this and sales went down. Because fans are cheap and delusional. They buy Spirit Airlines tickets and then are surprised when they have to pay for overhead baggage space. Try to protect these people and they complain, they think they're being ripped-off.

But there are no miracles. A new Mercedes-Benz doesn't cost $10,000, why should every concert ticket be $50? Why is someone, why is EVERYONE, entitled to such a deal? THEY'RE NOT! So you've got uninformed people who are convinced they are right bloviating loudly. Just like politics!

I'll make it simple, don't go! No one is forcing you to.

So the act only has one career, they don't want to look bad. But they're pissed because scalpers are getting all the uplift. So either they charge more or they give up all that profit. But charging what the tickets are worth? A no-no! People spend $100 bucks for dinner, but for a concert, too much! And they've got to tip, otherwise the waiters wouldn't make a living, but even worse, they wouldn't show up to work!

And how come Taylor Swift is skating here? How come there's no press that no one had attempted a sale of this scale previously? First time always takes risks. And the reason no one took on a sale of this magnitude is because they were worried about exactly what happened, the system being overwhelmed. As for Ticketmaster saying they could do this... Try saying no to a superstar act, good luck.

And why did all the tickets have to be sold at the same time? So Swift could spew it all over the press, the number of tickets sold, the cash generated, that's the only reason. And is that worth the risk? OF COURSE NOT!

And everybody in the business knows Verified Fan is flimsy. Sure, it weeds out some bad actors, but tons are left. But the public thinks it's gonna get a good ticket and at a good price which is just b.s.

So everybody has dirty hands. But, once again, the focus is only on Ticketmaster. Because the acts can't be guilty, even if you tell the fans they don't believe it. And the government is looking after duplicitous fans? Come on.

The fans are never happy. And a very small minority is making most of the noise, the delusional ones.

So let's go back to the on-sale. The goal is to create mania to make the dates go clean, i.e. sell out. Yes, you hear tickets are going for a grand and you think you'd better buy yours now. And sometimes this mania works, and sometimes it does not. There's hoopla for a day or two, and then...tickets go unsold and they never sell. Maybe they were priced too high to begin with. But everybody thinks good tickets are gone and they don't even go back to the ticketing site. And the tickets are not sold and the promoter, who works on less than a 5% margin, may end up losing money. Apple works on 30% margins, but concert promoters, who guarantee the acts the money, huge sums, far, far in excess of record company advances, are the bad actors here? Just like the bozos believe Spotify is the devil. No, the label is taking most of the money. But it's preferable to hate on Spotify, because Daniel Ek is young and rich and the musicians are not. Musicians whose music isn't listened to much to begin with.

As for starting musicians...

They've got someone wet behind the ears testifying in Congress. Because he wrote an opinion piece in the "New York Times." Yes, all you people who think the "Times" doesn't count, the joke is on you. This guy went from nowhere to D.C. almost immediately.

But where is the club owner testifying? Who takes all the risk, just in opening the doors. Yes, there's a ladder. At the bottom, the deals are worse, when you become a household name, the deals are better. They call this leverage. And club business is so good...that most of them went out of business. Been to the Bottom Line recently? Those clubs existed because the labels supported them, bought tickets and drinks, which they no longer do. As for what the industry calls "clubs' today...many are what were previously labeled "theatres," they hold thousands of people. But this guy testifying in Congress can't sell that number of tickets. Where are the people who can? Who are getting good deals? Why should leverage work everywhere but the concert business?

And how about the people who love scalpers? Because they can buy good tickets at the last minute. And it's not only the rich, the superfans do this too.

And the fans want to scalp the tickets they purchased so they can go free, or at a profit. You can make tickets cheap and get rid of resales by going paperless, but the fans HATE THIS, because they can't scalp.

But even worse, the fans don't understand that scalping is a professional business. You can't compete against the pros the same way you can't play in the NBA.

And the dirty little secret is...

Everybody can get a ticket. Taylor Swift is playing stadiums! Just show up before the show, there will be tons of tickets available, people who got caught up in the mania and bought four when they only needed two, not realizing no one is going to overpay to sit in the upper deck.

Any arena show it's the same thing. You can almost always get a ticket.

But no, Ticketmaster is the enemy.

Furthermore, the consent degree extension has nothing to do with all this, it's got to do with Ticketmaster strong-arming venues to sign up with Ticketmaster in order to get shows.

Wow, never have so many known so little.

Meanwhile, Taylor Swift and the acts end up smelling like a rose, when they're the ones generating all the problems.

You want to improve the situation? Have multiple sellers of tickets like in Europe. But then what happens to the payments to the venues, all that money from Ticketmaster that goes straight to their bottom line as payment to be exclusive? The government is just going to take that away?

But I'll go even further. If you're not on the Ticketmaster site, good luck people knowing about your show. That real estate is the most valuable in concertdom. Getting the word out is impossible. You can't reach everybody. Ticketmaster is actually providing a service here. Never mind their e-mail list. You want to use Ticketmaster!

Oh, there could be change in the sphere, but someone would have to suffer.

Acts could charge what the tickets are worth, but fans would pay more.

Acts could keep tickets cheap, but fans wouldn't be able to resell them.

The fees could be rolled into the deal... But then the promoter would get screwed or the act would have to take less.

This system didn't happen by accident, there was evolution. And it's not only about Ticketmaster. In fact, most of the innovation came from Ticketmaster. Picking your own seat...you couldn't do that with Ticketron.

So Amy Klobuchar grandstands and the fans rail against Ticketmaster and what happens?

NOTHING!

Unless Lina Khan gets involved and then...

Someone's going to suffer.

Some thoughts:

The venue should be satisfied with the money they make from parking, food, drink & alcohol sales. There shouldn’t be a “Fan Fee” for renting your seat in the venue. The ticketing agency should be able to charge a $3-$5 service fee for operating online servers, processing credit cards, paying customer service staff, etc… and the venue should be able to charge the same to pay the clean up crew, vendors, etc… there should not be a 40% on a ticket because of after cart fees.

Bands need to take responsibility & make demands on the industry. Without the acts playing the venues, the venues sit empty, so all the muscle is with the artist if they flex it right. They need to demand that all tickets be made NON-RESELLABLE, put names on tickets linked to accounts and make people show ID at the door. That puts scalpers outta business tomorrow. If that’s the goal, then there’s an east answer. Bands should all follow the Phish model and demand to be able sell half the ti lets on their own through own website and either have the venue waive the fees or have the band eat them out as their cut.

This isn’t some mysterious problem without a solution. It doesn’t require hearings, Congress, laws, or some sorta magic to fix it. It needs Bands with balls like Pearl Jam & String Cheese, a well funded alternative and fans willing to boycott those who don’t play ball.

I refuse to believe that there can’t be a competitive company to challenge TM/LN. If Ryan Cohen can start Chewy, take on Amazon and eat their lunch in that market then why can’t a company challenge TM. For the last 20 years The WWF has dominated Sports Entertainment/Pro Wrestling and had zero competition but during the pandemic the Jaguars owner’s son Tony Kahn started AEW and he competes with the WWF after a year… maybe you can’t challenge TM across the board, maybe it takes a genre to do it. I doubt Jam Bands have that kinda pull, but Nashville does. If Nashville walked away, played college, high schools, state fairs and mall parking lots turned into venues then that could move the needle. I just see people bitch and whine about this problem but no one ever offers solitons or does shit about it at the artist level, gov’t level, fan level or the competitive business world.

This is one industry where scale does not create many economies of scale. LiveNation just bought The Ritz here in Raleigh. They will jack up fees, but it takes effectively the same number of people to make a show happen. Therefore the extra money is just about paying the additional overhead at LN headquarters, or more profit, or to cover for a less profitable venue elsewhere. Break that fucker up.

I much agree with nershit. I would gladly get behind theses ideas.

AXS took over the Norva and National here, and what we see are fees from a few dollars to 50% of the ticket, plus big fees for mailing each ticket.  And they have a work-around for some--you can go to the box office in person any Friday and buy a ticket with only a $3 fee, which for DSO is 10%. But they are a 1500 venue with smaller shows.

When I was talking to the manager about the high fees, he said that's the only way he (meaning the venue) can make money. AXS provides a ticketing service, and consumers pay for it. Sure, a band could volunteer to cover it, so your $30 ticket costs $30, but the band now gives up 10-50% of the gate, and they will plead poverty along with everyone else.

For perspective, the hue and cry is over mega artists like Swift and Springsteen. The "distressed inventory" of the ordinary shows is huge. Like music by Wagner, it's not as bad as it sounds.

I suspect that the bands that go to venues that are too small are not for the "listening room" experience but to assure the vibe of a sell-out and capitalize on panic buying and the publicity it brings.

Because Lefsetz is so garalous I'm breaking down his "solutions" post, because I think he is also well informed, mostly:

<<Let's start with the fees. Everybody wants them baked in, except for the acts. Ironically, even those acts complaining about the fees!

Everybody on the inside knows the real price of the ticket is the face price plus the fees, otherwise the whole concert promotion paradigm doesn't work. The promoter needs those fees to make a profit.

But here's where Ticketmaster takes the blame once again. The hate is focused on the ticketing company when it's really the fault of the act! The act can ask for an all-in price, Ticketmaster has no problem with this, but so many acts don't want this.

Let's use an example. A club show. $25 face value plus $25 in fees. The act can side with the fan, you're getting ripped-off! But the truth is the ticket really costs $50. It's just by making half of it fees, the act looks like it's not overcharging, that it's on the fans' side, when this is not the truth.

Of course there are acts that would go to all-in pricing, but unless there's uniformity, there is no solution, no happiness.

Never mind all the other industries, like hospitality, that survive on fees.>>

I need to verify with my source his view about the visible price structure being solely the doings of the acts. On a counterpoint, the big acts price their tickets below market; the secondary market reveals the true price or value to the buyers.

He says:
<<Here's the bottom line. When people rail against Ticketmaster it's because supply exceeds demand. People are inherently left out. And unhappy. And, inherently those tickets that are available will either be worth more than the face price or end up being very expensive.

And you know who is responsible for that? THE ACTS! They want you to blame Ticketmaster as opposed to themselves. Oh, they could price the tickets at what they're worth, but you'd call them greedy, and they are uber-protective of their image. The Stones price their tickets at what they're worth, but there's not a lot of runway left in their concert career, and they are the STONES!

Which brings me back to the fact that the fans are delusional. They believe they are entitled to be in the building, in a good seat at a low price. And oftentimes that's literally impossible!

And, of course, there are all those shows that aren't instant sellouts, where the promoter is at risk... So it's not hard to get a ticket and people don't complain, except for the fees. And, once again, the fee problem was generated by the acts!>>

My view: One thing that separates a concert ticket from a consumer good like a fancy car or expensive dinner, is the feeling that music is art, and art should be available to the masses. No one needs a Ferrari and can go 55 mph in a 15 year old Camry. But Springsteen is Springsteen and a tribute bar band won't do (to most).

But all that priceless wall art available to the masses for free or nominal amounts at the big museums? Someone is paying big bucks to put it there and make it accessible--rich benefactors and yes, your tax dollars. Same with symphonies, opera, theater, and many historical, ethnic, jazz and folk live music shows--that is, the ones that are not commercially viable but are seen as somehow culturally important or valuable. However, they seldom have the sell-out pressure: the supply exceeds the demand.

So maybe the complaints about the ticketing process, levied against Ticketmaster, is simply the reality that can't be manipulated: people with more money get to have nicer things.

not sure what you mean. what I see here is exactly as it appeared in the original text.

But i use a computer screen not a "smart"  phone

ETA I tried posting to "BB CODE" and nothing happened.  It may be because these texts are coming from emails, not hyperlinks on a web page, and I just copy/paste. I don't see any extraneous markings on my screen.

sorry doing the best I can

No worries. Maybe it's because I'm reading on my phone screen. I'm just sharing some tech tips...

All good points.

Some people, buying a car, just want to know the final price, take it or leave it. Others want to see all the components; maybe some can be negotiated, but at least he knows where his money goes. All in v Dynamic is the same quandary, and from the experts above, the marketing guys say dynamic is better, painful as it is.

Here's the hook, which I hate: I see that SCOTS is playing for $30 GA; I'd pay that much but not $45. But once I "get in line" the ticket comes to $45. I begrudgingly pay it, and try to wash away the bitter taste with overpriced beer inside. But the process got me heading in at the first "bait and switch" step.

And personally, I oppose laws regarding these things, but that's a whole 'nother conversation for another day.