For years there has been one company which has had a strong grip on all primary ticket sales for events across the country. But now that company, Ticketmaster, is beginning to see its hold on the market begin to slightly weaken. Venues are beginning to cut ties with Ticketmaster, and turn to companies like Live Nation, which late last year announced it will be starting its own ticketing outlet when its contract with the ticketing giant expires in 2009. The two companies will continue to work together at some venues.
Currently representing more than 15 percent of Ticketmaster’s $1 billion annual revenue, Live Nation is the largest concert promoter in the country and is looking to get bigger. Major performers and major money makers U2 and Madonna signed highly publicized long term exclusive deals with Live Nation, and Jay-Z is reportedly negotiating with the company. As the months go on, Live Nation will be looking to add more performers and more venues to its repertoire.
As venues start to end relationships with Ticketmaster here and there, the sticking point for many of them are complaints about the additional service fees that are tacked onto ticket prices. According to a story in the Chicago Sun-Times, concert hot-spot Metro in the windy city was one of the latest to drop its contract with Ticketmaster due to what it explained were “customer requests and technological advances.”
Ticketmaster CEO Sean Moriarty called his company, “one of the most misunderstood well-known companies out there,” at the South by Southwest music conference adding that service fees are a necessity just like ones added for amenities like cable television and ATMs.
Even if that is the case, Live Nation is making strides to separate itself from the stigma attached to the service fees with its subsidiary House of Blues selling tickets at their box offices with no service fees at all. Whether or not Live Nation will follow a similar policy, when it officially splits from the ticket giant in 2009, remains to be seen.
As Live Nation and other ticket services begin to chip away at the profits of Ticketmaster and provide more competition, how tickets are sold could begin to change. The secondary market continues to grow and now Ticketmaster has been making strides to take a stranglehold over it as well. They have already completed a deal for the secondary market company TicketsNow.com and are lobbying to change laws to only allow the original seller of the ticket to resell that ticket.
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I will agree with Moriarty on the misunderstood part. Ticketmaster’s minimum service fee is around $8. They make no money from the face value (its not like a retail store where they pay a wholesale price for the ticket and then mark it up to retail). Do the service fess suck? Yes. Are they high? Yes. But the rest of the money in the ticket price, service fee and the “Facility”, “Convenience”, “Parking” and other fees go to the promoters, venues and artists. Ticketmaster is a convenient whipping boy. Think about that the next time fees are $15 – 20 per ticket on a $400 ticket…the high ticket price and the outrageous fees are because the promoters overpay and the artists demand too much money. The bitching is justified but get the facts straight. A year from now, when you have a few quarters of Live Nation in the ticketing business, then look at the net result. Don’t think your TOTAL TRANSACTION price will be lower for LiveNation.com tickets…the fees will simply be in the face value, buried in the auction or VIP package price, etc. And if they are in the face value that’s even worse for you because the face value is SUBJECT TO SALES TAX, unlike most service fees SO YOU WILL BE PAYING MORE. Service fees will be “gone” and it will still be more expensive than ever to go to shows.
You’ll see.
too bad the public hasn’t noticed that Live Nation doesn’t charge service fees but instead, prices the “prime seats” at such a premium the service fee is not as noticable – sheep in wolf’s clothing I guess. Sign the biggest acts and then mask your profit. Cool.
Artist’s greed being hidden or the over the top guarantee that Live Nation offered?
It aint the live nation profit being hidden, it is the artist’s greed
It still amazes me on how many brokers have their complete inventories, their COMPLETE FINANCIAL WELL BEING, THEIR ENTIRE LIVES, listed on TicketsNow. Ticketmaster’s sole goal is to have complete control of the primary and secondary markets.
“lobbying to change laws to only allow the original seller of the ticket to resell that ticket”
Anyone catch that? I think brokers need to read that and realize what Ticketmaster’s end game is…..that don’t want to “work with you” – they want to put your business 6-feet under. Open your eyes.
For the average ticket buying consumer? You think having a Ticketmaster monopoly for both markets will be good for consumers?? Hahahah, good one !!! 🙂
Ok – Take a look at this. At the Metro for Rev. Horton Heat:
Price Conv. Fee Total
4/18/08 9:00 PM The Reverend Horton Heat $23.00 State Tax $0.15
Convenience Fee $5.81
Ticket Fee $0.00
$28.96
Delivery Fee
$0.00
Order Fee
$0.00
$28.96
$5.81 CONVENIENCE FEE – That’s 25% of the face!!!!!!! That’s fucked