Selling Tickets in a Digital Age: Why Ticketmaster Will Fail

A recent court case involving the ticket distribution giant Ticketmaster (TM) and internet technology firm RMG Technologies, came to a completion two weeks ago as the judge involved in the case ruled in Ticketmaster's favor. The ruling grants the ticket-selling giant an injunction that, according to a personal statement on its website, stops “RMG Technologies from facilitating access to [their] ticketing system.” Digital Infrastructure, an internet technology website, claims that RMG systems was responsible for developing software that circumvented security systems, that the software was rented out to scalpers, and that this software allowed these scalpers to “barrage Ticketmaster's computers with requests for tickets to perform automated purchases, crowding out other buyers.” This is not the first time that the ticket seller has been compromised by scalpers who have the technology to obtain a large number of tickets from them illegally, and subsequently sell them at higher prices on online auction websites. In fact, the article by Digital Infrastructure further asserts that internet scalping is quickly becoming a major bane; an impedance that hinders honest fans from obtaining the tickets they deserve. A colleague of mine recently posted a blog post about Ticketmaster and the scrutiny it has come to face from many unhappy ticket buyers, such as the person who created the image to the left. She states that the ticket seller has “not done enough to keep its customers happy,” and that, “[c]onvenience fees on top of base ticket prices are getting steeper and steeper.” High convenience charges, comprised security ... is the ticket seller doing anything right these days? All of the facts suggest that, no, they are not providing a beneficial service to anyone save for making immense profit for itself and its affiliates. With the music industry in its current state and as people grow increasingly less fond of the ticket giant, it is important to find new ways of distributing and selling tickets in a fair manner in order to save the economic value of the live performance.

One way to avoid its unfair ticket sales is to flat out boycott Ticketmaster altogether and buy tickets from a ticket broker or reseller. A great resource for alternative ticket-selling websites is Concert Tickets.com, which has a list of all of the best brokers and resellers. The benefit of buying from one of these companies is that, through the networks of licensed brokers that each company operates under, one can potentially obtain high-demand tickets that sell out quickly, or that were never available for sale from TM due to their pre-sale giveaways to concert promoters. Consequently, true fans have a better chance of obtaining these high demand tickets through a reseller or broker than through the ticket giant. Through my own research, however, it appears that the ticket prices offered by these resellers are drastically higher than those offered by TM. For example, floor seating tickets for the November 8th Hannah Montana/Miley Cyrus show in San Diego are offered on TM for $66.00, while Ticket Liquidator offers a comparable ticket for $893.00! Therefore, while fans benefit by avoiding TM's low inventory and high convenience charges, the price of obtaining that special ticket from a broker or reseller may not be worth the effort. That said, however, according to its About Us section on its website, TM, believes that it is still the "world's leading ticketing company", and that because of this, high demand tickets sell very quickly and are often hard to obtain. For this reason, the ticket giant created Ticket Exchange, "the event-authorized ticket resale service provided by Ticketmaster", as noted by this press release on its website. The article further claims that, "fans looking for tickets may visit TicketExchange to purchase tickets that might not otherwise be available." Consequently, although fans are increasingly wary of the ticket giant, if one chooses to believe that they are sincere in their efforts then the corporation is taking steps to lessen the burden on ticket-buyers.

A very exciting, revolutionary way of selling tickets was recently brought to my attention by another music industry colleague. Her recent post focused on the band Led Zeppelin and its reunion concert taking place in London next month. In this post she mentions how Harvey Goldsmith (the band's concert promoter) devised a new method of selling tickets to fans for the concert. Essentially, Goldsmith's aim was to avoid using what he refers to in his blog as “parasite businesses,” who, through increased ticket prices, “prevent fans from supporting their artists.” The basic principle of his new ticket system is based around a lottery, which chooses winners at random. There is also a strict limit on the number of tickets one can obtain (two per person), and the credit card used to pay for the tickets must be under the name of the person chosen by the lottery. If these conditions are not met, then the ticket is withheld from the buyer. The benefits of this system are apparent when compared to the traditional Ticketmaster model-it makes ticket buying more fair by choosing winners at random, and it also blocks potential internet scalpers who are trying to automate purchases for large numbers of tickets.

With the increase in the number of unhappy ticket-buying consumers, a market for cheap, easy-to-obtain tickets is slowly being realized. Forward thinking people such as Harvey Goldsmith are taking advantage of this opportunity and are making better businesses by learning from others' mistakes. Taking it a step further, one can envision a future where artists, record labels, and their appointed promoters will set up private event websites that specifically cater to fans by offering cheap, fairly distributed tickets, much like Goldsmith's lottery. In this way, artists, concert promoters, and venue owners/operators will work together to produce concerts by bypassing the corporate giants such as Ticketmaster, saving everyone a lot of money and bringing back the magic of the live performance to whom it belongs-the fans (see image to the right).