Ticketmaster raises white flag to scalpers
A new platform called TM+ merges original and resale tickets, giving customers the option to buy either.
Ticket scalpers are unlikely to be friends with such big businesses as Live Nation (LYV) and Ticketmaster.
But a new ticket-selling platform may indicate that the big guys are ready to get along with resellers, Bloomberg reports. The TM+ platform merges primary and secondary ticket sales, giving customers the option to buy original-issue tickets or ones being resold.
"It's . . . bringing your enemies closer to . . . manage that process a little bit, and it all comes down to dollars," said Paul Sweeney, the U.S. director of research for Bloomberg Industries. "Ticketmaster wants to get a cut of the fees that the scalpers are now getting."
There are several ways Ticketmaster will benefit from reseller sales on TM+, according to The Wall Street Journal. Scalpers will pay a fee with the original purchase and a fee to use the reselling software. Customers will have to pay a resale commission and a final fee with their purchase.
Ticketmaster and Live Nation merged in 2010. The combined company is responsible for 80% of the live event ticket market in the U.S. Ticketmaster sold more than $143 million in tickets last year, according to the report.
Reselling concert tickets is a $4 billion-a-year business.
Scalpers are a rising problem for normal ticket buyers. Their ability to bypass Ticketmaster's online security allows them to buy large blocks of seats quickly, oftent blocking casual fans, according to Sweeney. After the concert is sold out, many fans turn to resellers like StubHub for seats.
Tickets from resellers will be clearly marked on TM+. Resellers interested in the platform will have to be verified by Ticketmaster.
In order for TM+ to work, resellers will have to buy into the idea. They have a history of friction with Ticketmaster and Live Nation officials, who have failed in their attempts to quash scalping. Ticketmaster has also tried to create rival websites to StubHub.
"I think what's really different this time is they are actually inviting the ticket scalpers . . . on to the Ticketmaster platform," Sweeney said.
TM+ would prevent tickets from being sold for less than face value. The Wall Street Journal reported that brokers criticized the amount of pricing control that gives Ticketmaster. They also accused the company of holding back tickets for VIPs and corporate sponsors.
It's going to be tough for Ticketmaster to compete with established resellers like Stubhub, according to Porter Bibb, a managing partner at Mediatech Capital Partners.
"The consumer reaction is going to be it just costs me more if Ticketmaster comes into the picture," he said.
Dallas, TX Sold out show for "Book of Mormon" Well not really.. All the tickets are on Stub Hub at DOUBLE face value. Suck it scalpers, not paying you to be a fat middle man.
(Stub Hub is a eBay owned company)
RE: TM+ would prevent tickets from being sold for less than face value.
So that means if you bought a ticket in good faith then could not attend the event, you couldn't use Ticketmaster to sell it?
Sounds like price fixing.
Every time I tried to buy tickets thru Ticketmaster I felt like I was being scammed. Just can't do business with them and feel good about it. At least when you buy from a scalper they admit they are scalping you!
Wow - Re-selling beats the crap out of Ticketmaster - who knew. Consider these two quotes from above:
"... responsible for 80% of the live event ticket market in the U.S. Ticketmaster sold more than $143 million in tickets last year..."
and of course:
"Reselling concert tickets is a $4 billion-a-year business. ."
Since virtually ALL concerts are live events, and Ticketmaster's 80% share only came to $143 million, yet the scalpers got $4 billion -Ticketmaster must be giving away tickets!
... and not only do greedy Ticketmaster and other re-sellers like StubHub get commission from both the buyer and seller, their percentage is based on the total price of the re-sell transaction, not just on the amount that is above the original buyer's purchase price.
Sounds like the Ticketmaster CEO has gotten in bed with the Cedar Fair CEO. Ticketmaster-Scalping Not Allowed, Pay a Fee now it is OK. Cedar Fair-Line Jumping Not Allowed at our Amusement Parks, Pay a Fee and go ahead to the Front of the Line. Corporate Greed never ceases to Amaze me.
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The company has made at least 4 acquisitions in the space, and few people have paid any attention.
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