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WSJ: Azoff tried and failed to make a major move into the secondary ticket market
Thu, Aug 27th 2009 11:37 pm EDT
By Alfred Branch Jr.
Under the codename "Project Showtime," Ticketmaster Entertainment CEO Irving Azoff reportedly tried to drive potential merger partner Live Nation out of the ticketing business by aggressively courting several major secondary ticket companies, according to The Wall Street Journal.
The brokers Azoff reportedly met with during the summer of 2007 – about the time Live Nation was announcing its intention to break away from Ticketmaster as a client – are a who's who of the leadership of the National Association of Ticket Brokers (NATB): the owners of Ace Ticket; Barry's Tickets; Gold Coast Tickets; Total Tickets; Elite Ticket Service; and Alliance Tickets. Ticketmaster was looking to buy the six brokerages for about $25 million each.
Also included in the discussions were representatives from Madison Square Garden (MSG) and AEG Live, according to the Journal, but the deal fell apart due to "mutual distrust."
Azoff had yet to officially join Ticketmaster at the time, but his company, Front Line Entertainment, was partially owned by the ticketing giant, and the thought was that with a contingent of big-time ticket scalpers on its side Ticketmaster could vanquish Live Nation. Almost a year later, Live Nation and MSG flirted with teaming up for ticketing, which sent Ticketmaster into a tizzy. The matter came up because MSG's contract with Ticketmaster was coming up, but MSG quickly resigned with the company.
As soon as Ticketmaster and Live Nation announced their plans to merge earlier in the year, Azoff began trashing the secondary ticket market, even going so far as to say he never would have bought Ticketmaster's own ticket scalper, TicketsNow, had he been at the helm when the company made the $265 million acquisition.
In the fall of 2007, before the deal fell apart, the brokers were reportedly part of the scheme to scalp Van Halen tickets, according to the Journal, which was a major story that year. As part of the deal, the brokers were given hundreds of premium seats to sell, and then split the proceeds with Van Halen and Ticketmaster. The band is one of Azoff's clients, and the plan reportedly led to Van Halen making at least an extra $1 million on that tour.
The reported deal with the brokers paints a sobering picture of the lengths Azoff and Ticketmaster would go to in its quest to remain the world's dominant ticketing company, and also shines a light on just how much power the company could have if it also hooks up with the world's largest concert promoter, Live Nation.
Critics have said that the proposed merger could have a devastating effect on the secondary ticket market because the two could potentially shut out brokers at will.
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Comments represent the opinions of users and do not necessarily reflect the views of TicketNews.OK DOJ, heres the nail in the coffin,DO NOT ALLOW THIS MERGER. Theres no way this merger happens if this story is true. Looks like our industry is saved by this evidence
I'm not sure how this really hurts the merger. All Azoff was trying to do was tap into the profitable secondary market. He wasn't even CEO of Ticketmaster when it happened. I definitely agree it exposes him as a hypocrite, which should come as no surprise, but I think it's a stretch to say this will really affect the merger.
Thats a lot of money to turn down, the article seems to slant that these guys as NATB members were doing something wrong, we should be standing up and applauding them for staying on there own. They turned down more $$$ than any of us would. Thanks to keeping us brokers and this business alive! These guys are industry leaders and damn smart, Who wouldnt want to be Barry or Jimmy?
It wasnt that much and they didnt turn it down! It wasnt going thru becasue it didnt make sense
Ticketmaster's board should fire Irving Azoff immediately, if this news is true. And the DOJ must now end any discussion of allowing this merger.
Why should Ticketmaster fire Azoff? And the DOJ 'must' not do anything. Ticketmaster purchased TicketsNow, which I can guarantee you would have been a great investment had Sean Moriarty's vision for the company been brought to fruition. The only reason TicketsNow is suffering is because Azoff has hung it out to dry in order to get the merger to go through. All this article shows is that Azoff's vision for the future of ticketing is no real different than Moriarty's was - and that included Ticketmaster owning secondary market assets. Azoff may be saying otherwise in order to appease Congress, but if the merger does not go through, I'm willing to bet Azoff (or whoever is in charge of TM at that point), rebrands TicketsNow and turns it into an even bigger player on the secondary market.
As for the DOJ, this really doesn't affect anything. If they question Azoff on why he tried to purchase these companies, he can easily just say that, although he has such disdain for the secondary market, the truth is that they are profitable and he was exploring the idea of tapping into that market. This likely will not have any significant impact on the merger.
Means Nurture A Ticketmaster blowout
If true it means Azoff lied under oath to the Senate committee and should be punished like anyone else who lies under oath.
Lied to what question?
He clearly stated that TM did not give brokers or Ticketsnow access to the best seats in the house.
He didnt lie about this. Ticketmaster did not give the tickets to brokers, read the article, Frontline gave the tickets. You need to dig deeper.
Frontline is part of Ticketmaster. Same company.
It wasn't back then. The article says this was all back in 2007. Didn't the TM/Frontline deal just happen late last year?
No, Frontline is its own company that is owned by Ticketmaster. If your wife committed a crime, the police couldn't arrest you just because you're married to her. Considering you come off as a broker (or a wannabe broker), you really don't seem to understand simple business concepts, like that a company can be owned by another and still operate autonomously.
when you're the ceo of both companies it's an issue
Hmmm, well when this was all happening, Ticketmaster and TicketsNow each had separate CEO's, which is typical for companies that are owned by other companies. Like I stated before, just because a company is owned by another doesn't mean they are necessarily 'run' by that other company. Seems like the concept may be a bit too heavy for you to understand.
Follow up to my last comment.
Watch http://judiciary.senate.gov/webcast/judiciary02242009-1430.ram
what time in the video does he make the comment about not giving tickets to ticketsnow or other brokers?
The question is asked at 1:04
It is interesting that he does say that he "believes resale should be illegal." Funny.
Absolutely he committed perjury. He knowing lied to the questions that were asked. The TM board of directors have to fire him. It's time for Ticketmaster to take a new direction.
i wonder what schummer would say