Joined: 12 Aug 2003 Posts: 1695
Location: Houston, Texas
Posted:
Fri Sep 05, 2003 8:07 am
Fed up with watching ticket scalpers and brokers rake in the huge bucks for prime seats at their venues, Ticketmaster plans to debut an online auction program for choice seats to selected concerts and sports events later this year, according to The New York Times. "...With no official price ceiling on such tickets, Ticketmaster will be able to compete with brokers and scalpers for the highest price a market will bear."
Do you think this is a good move for the concert industry?
I have still not seen this on the TM site. What is the deal?
Jarrod Vrazel Executive Producer
Joined: 12 Aug 2003 Posts: 1695
Location: Houston, Texas
Posted:
Thu Jan 08, 2004 8:08 am
Ticketmaster Auction Will Let Highest Bidder Set Concert Prices
September 1, 2003
By CHRIS NELSON, NY Times
Three years after Ticketmaster introduced ticketFast, its online print-at-home ticketing service, consumers have so embraced it that the company now sells a half-million home-printed tickets for sporting and entertainment events each month in North America. Where ticketFast is available, 30 percent of tickets sold are now printed at home, said the company, which is by far the nation's largest ticket agency.
But consumers - many of whom have complained for years about climbing ticket prices and Ticketmaster service charges - may be less eager for the next phase of Ticketmaster's Internet evolution.
Late this year the company plans to begin auctioning the best seats to concerts through ticketmaster.com.
With no official price ceiling on such tickets, Ticketmaster will be able to compete with brokers and scalpers for the highest price a market will bear.
"The tickets are worth what they're worth," said John Pleasants, Ticketmaster's president and chief executive. "If somebody wants to charge $50 for a ticket, but it's actually worth $1,000 on eBay, the ticket's worth $1,000. I think more and more, our clients - the promoters, the clients in the buildings and the bands themselves - are saying to themselves, `Maybe that money should be coming to me instead of Bob the Broker.' "
EBay has long been a busy marketplace for tickets auctioned by brokers and others. Late last week, for example, it had more than 22,000 listings for ticket sales.
Venue operators, promoters and performers will decide whether to participate in the Ticketmaster auctions, Mr. Pleasants said. In June, the company tested the system for the Lennox Lewis-Vitali Klitschko boxing match at the Staples Center in Los Angeles. The minimum bid for the package - two ringside seats, a boxing glove autographed by Mr. Lewis and access to workouts, among other features - was $3,000, and the top payer spent about $7,000, a Staples Center spokesman, Michael Roth, said.
Once the auction service goes live, Ticketmaster will receive flat fees or a percentage of the winning bids, to be decided with the operators of each event, said Sean Moriarty, Ticketmaster's executive vice president for products, technology and operations.
Along with home printing, auctions are central to "a new age of the ticket," Mr. Pleasants said. In the second quarter of this year, tickets sold online, with or without home printing, represented 51 percent of Ticketmaster's ticket sales. The rest were sold by phone or at walk-up locations.
Ticket Forwarding allows season ticket holders for several sports teams (including the New York Knicks, Rangers and Giants) to e-mail extra tickets to other users, with Ticketmaster charging the sender $1.95 per transaction.
TicketExchange provides a forum for season ticket holders to auction tickets online. The seller and buyer pay Ticketmaster 5 percent to 10 percent of the resale price, a fee the company splits with the team.
In the case of the ticketFast home-printing service, buyers pay an additional $1.75 to $2.50 per order, with the fee set by the event operator. Home printing has won converts among people who want tickets immediately, instead of receiving them by mail or a delivery service or having to stand in line at a will-call window.
One satisfied customer is Brian Resnik, 29, of Tampa, Fla., who says the home-printing fee is a bargain compared with the $19.50 that Ticketmaster charges for two-day shipping through United Parcel Service.
But some other users, who praised the convenience of home printing, objected to being charged an extra fee.
"It's kind of mind-boggling to me," said Joe Guckin, 41, of Philadelphia, who used ticketFast to buy tickets for a Baltimore Orioles home game last season. "You're printing up the ticket, on your printer at home, your paper, your ink, etc. - and you have to pay for that?"
The company replies that home-printing consumers are helping to pay for the technology that makes the service possible.
Ticketmaster has spent $15 million to $20 million to outfit almost 700 stadiums, arenas, theaters and concert halls in this country and Canada with bar-code scanners that read and authenticate the tickets and computers that capture information such as which seats are filled and which doors have the most traffic, Mr. Moriarty said. In 2003, the company has sold 400,000 to 600,000 ticketFast tickets each month.
Some ticketFast customers, like Diane DeRooy, 52, of Seattle, complain that Ticketmaster assesses a lot of fees even before levying the print-at-home charge. A ticket to see Crosby, Stills & Nash on Friday at the PNC Bank Arts Center in Holmdel, N.J., for example, carries $13.80 in venue, processing and convenience fees, plus a $2.50 charge for the home-printing option. Without the fees, a ticket costs $30.25 to $70.25.
Many of those customers are skeptical about Ticketmaster's plans to auction the best seats to concerts.
"The band's biggest fans ought to have the best seats, not the band's richest fans," said Tim Todd, 47, of Kansas City, Mo., who used ticketFast recently to buy tickets for a concert by the rock group Phish. Ticketmaster would be, in essence, official scalpers, Mr. Guckin said, voicing a sentiment expressed by some other customers.
Industry watchers agree that auctions will affect all concertgoers. Prime seats are undervalued in the marketplace, said Alan B. Krueger, a professor at Princeton University's Woodrow Wilson School of Public and International Affairs, who has studied ticket prices. He predicts that once auctions begin revealing a ticket's market value, prices as a whole will climb faster.
Gary Bongiovanni, editor of the concert industry trade magazine, Pollstar, predicted that all ticket prices would become more fluid. After a promoter assesses initial sales from an auction, remaining ticket prices could be raised or lowered to meet goals.
The notion of ticket auctions is annoying, Mr. Resnik said, but he is resigned to them.
"I guess the capitalist inside me would say, `Hey, if that's what they can get for tickets, I guess that's just something I can't afford, like a yacht and a Learjet.' "
Jarrod Vrazel Executive Producer
Joined: 12 Aug 2003 Posts: 1695
Location: Houston, Texas
Posted:
Thu Jan 08, 2004 8:15 am
Ticketmaster to Launch Ticket Auction
September 6, 2003
Pollstar
Fed up with watching ticket scalpers and brokers rake in the huge bucks for prime seats at their venues, Ticketmaster plans to debut an online auction program for choice seats to selected concerts and sports events later this year.
The move may drive up the price of front row seats when they start going to the highest bidder, but some analysts say the impact would likely be minimal since the best tickets for the hottest shows are already costing a fortune on the secondary ticketing market.
In fact, for some harder-to-sell ducats, such as shed lawn tickets, auctioning could actually result in lower-than-face-value ticketing in some instances.
But what this likely means is that for smaller events, frequently touring mid-level artists and those with particularly loyal fans who attend several shows a year, the ticket auction may not be as viable an option as it would be for, say, a tour by The Rolling Stones.
The idea gains a lot of traction when one considers the vast amount of tickets sold through the secondary market, including over the Internet, for many times over face value.
One problem TM hopes to reduce, if not eliminate, is counterfeit or otherwise illegitimate tickets being sold through online auctioneering.
"There's a lot of issues with legitimacy and making sure the fans are buying legitimate tickets," a TM spokesperson told POLLSTAR. "That really comes into play with online auction houses where you don't know. Also, with sporting events or concerts, there's no way of predicting when it might get canceled."
In the event of cancellations, one big advantage of bidding for tickets through TM is that the buyer will be eligible for a refund, unlike most tickets purchased on the secondary market.
"(If) the ticket's no good, there's no recourse to get your money back (in the secondary market). ... It's our ticketing and it's our technology that enables refunds. So, basically, what we are providing the client is the safety and security in knowing that if they choose to use the service, that their consumers will automatically have legitimate tickets."
With TM conducting some of the sales by auction over its ticketmaster.com site, it signals an attempt by the music industry to regain control over the dollars it considers rightfully its own to begin with.
"Ticketmaster is more a business-to-business store than a consumer one. We've developed the technology more out of a need from our clients," the spokesperson explained, noting that venues and promoters approached TM with the idea.
"I think more and more, our clients - the promoters, the clients in the buildings and the bands themselves - are saying to themselves, `Maybe that money should be coming to me instead of Bob the Broker,'" TM President/CEO John Pleasants told The New York Times.
Some artist managers and promoters are cautiously supportive of TM's idea, and some of that support is coming from surprising quarters.
A rep from Madison House, the management and booking arm of The String Cheese Incident - which is currently suing TM in a dispute over the release of large blocks of tickets to artist fan clubs for direct sale - said that while the band likely wouldn't participate, the plan could work well for others.
"Our understanding right now is that there would be a conversation between the artist and the promoter and venue," Madison's Carrie Lombardi told POLLSTAR. "As long as that's the case, more power to them."
TM confirmed that indeed will be the case.
"Unless our clients - being the promoter, the venue, sporting team, the band - are in agreement they want to do this with their tickets, we wouldn't do it. We just have the system in order to enable it," TM's spokesperson said.
Princeton University economics professor Alan B. Krueger, who has studied ticket prices for POLLSTAR, called the open auction a "positive development."
"For the top artists, tickets are still sold below what the market would bear, even though prices have shot up over the last six years," Krueger told POLLSTAR. "This is especially the case for the best seats in the most expensive cities.
"If the auction is widely used, I suspect price variability will increase; we will see greater dispersion in prices across artists, across cities and seats for the same artist, and across venue types. Performances in large stadiums, which have not been selling out, may well see their prices drop if most tickets are distributed in an auction."
Krueger also noted that economic factors won't be the sole force at play when it comes to open-auction ticketing; social forces will be a factor, as well.
"Some artists ... like to give back value to their fans in the form of below-market prices," Krueger said.
"Interestingly, my survey of scalping suggests that Bruce Springsteen succeeds in this regard, as most of his fans hold on to their tickets rather than re-sell them through scalpers for higher prices. I suspect that artists who believe it is important to keep their prices affordable for most fans will continue to do so by continuing to distribute most tickets at fixed prices, or by distributing tickets at reduced prices to their fan clubs.
"In the post-Ticketmaster-auction era, I hope artists will also find other creative ways to give back value to society. For example, they can commit to donate X percent of the revenue they raise from selling their tickets in an auction to charity or to a political cause - or maybe for scholarships for low-income children to attend a college or university," Krueger explained.
TM successfully tested the system, which has been about 18 months in development, in June for a Lennox Lewis fight at the Staples Center in Los Angeles, according to TM, with a package of tickets, autographed gloves and other perks going for $7,000.
Once the auction service goes live, TM will receive flat fees or a percentage of the winning bids, to be decided with the operators of each event, Sean Moriarty, TM's executive VP for products, technology and operations, told the Times.
Jarrod Vrazel Executive Producer
Joined: 12 Aug 2003 Posts: 1695
Location: Houston, Texas
Ticketmaster Auctions
On behalf of the venues, promoters and artists for whom we work, we offer a system that allows for the pricing and sale of tickets based upon the fans' level of interest. Through this system, venues, promoters, and artists at their option can offer consumers a safe, secure, credible and convenient way in which to purchase tickets. Fans can be assured that the dollars they pay actually go to the venues, promoters and artists that present the live event, and in the case of a cancelled event, they will be eligible to receive a refund.
Our auction product allows venues, promoters, and artists to sell tickets directly to fans at a fair market price. Traditionally, the reselling of tickets has been done by third parties in an aftermarket that is often insecure, potentially fraudulent, and may provide poor value to consumers.
TeamExchange
With TeamExchange, season ticket holders can make the most of their season ticket investments. Through the team website, season ticket holders can post the tickets they can't use for sale. Fans can then view and purchase these premium tickets safely and securely.
Jarrod Vrazel Executive Producer
Joined: 12 Aug 2003 Posts: 1695
Location: Houston, Texas
a few interesting components of the auction terms:
You understand and acknowledge that when you acquire tickets through an Auction you may pay higher ticket prices than you would pay had you acquired those tickets through another means, such as another auction or a traditional "fixed price" sale via a venue box office, telephone call center or the Tickemtaster.com web site, and that it is possible that identical or different tickets may be obtained before, during or after that Auction at the same price or a different price via a means other than that Auction.
TICKETMASTER RESERVES THE RIGHT TO REFUSE TO ACCEPT HIGH OR WINNING BIDS.
TICKETMASTER IS NOT OBLIGATED TO ENFORCE THESE AUCTION TERMS AGAINST ANY OTHER BIDDER.
When you bid, Ticketmaster may run an authorization on your credit card for $1 (and may run subsequent authorizations at later times for $1 or the total amount you bid). Your credit card will not actually be charged unless you have a valid winning bid at the end of an Auction.
You acknowledge that ranking seats from best to worst is inherently subjective. If auction rules contemplate establishing any such best to worst rankings, then Ticketmaster and the event providers may call on their industry experience and venue knowledge in establishing any such rankings. However, because of the subjective nature of such rankings (i.e., different people may have different opinions about what is a "better seat"), you acknowledge and agree that if you ultimately disagree with any best to worst seat rankings used in an Auction, you will not contest such rankings and will accept the seats assigned to you.
You acknowledge that this means that it is possible that an auction winner that pays less money per ticket may win seats that, in your opinion, are superior to those seats that you win.
Jarrod Vrazel Executive Producer
Joined: 12 Aug 2003 Posts: 1695
Location: Houston, Texas
Posted:
Thu Jan 08, 2004 9:21 am
atexas wrote:
I have still not seen this on the TM site. What is the deal?
With virtually no news in four months since the announcement and only a mention on the TM site, it seems to be either vaporware, TM wishing they were a broker, or perhaps the perceived conflict of interest has delayed things.
Quote:
Fans can be assured that the dollars they pay actually go to the venues, promoters and artists that present the live event
So in essence, TM would be partnering with the venues, promoters, and artists to scalp tickets. Sound like fans can be assured they will be getting screwed all the way around.
Quote:
Traditionally, the reselling of tickets has been done by third parties in an aftermarket that is often insecure, potentially fraudulent, and may provide poor value to consumers.
Interesting that Ticketmaster makes the statement of resellers providing poor value to consumers. With consumers already fed up with TM service charges and customer service, one can only imagine the TM customer experience expanding into the secondary market.
Quote:
TICKETMASTER RESERVES THE RIGHT TO REFUSE TO ACCEPT HIGH OR WINNING BIDS.
Whoever pays the most gets the tickets. Unless TM decides it doesn't like you, then your winning bid is a loser.
