There is a lot of frustration out there in the ticket buying world as thousands of fans virtually line up at primary sites like Ticketmaster.com for tickets to hot shows and, for a variety of reasons, come away empty handed. For many, that frustration increases exponentially when they see those tickets on secondary sites, often at prices several times face value.
Artists, fans, venues, promoters and ticketing companies like Ticketmaster blame certain ticket resellers for gumming up the works by hammering the primary ticketing sites with automated bots that cut “line” and shut out fans; selling “spec” tickets on secondary sites that they don’t even have and might never get; and/or joining artist fan clubs or other pre-sale avenues to get choice tickets artists intend to go to fans and reselling those at a price much higher than the artist intended.
We spoke with Michael Rapino, CEO of Live Nation Entertainment, which owns Ticketmaster, about the problems concert fans are facing in buying tickets, and what his company is doing about it.
Billboard.biz: When it comes to fans buying tickets these days, what’s the problem as you see it?
Michael Rapino: This isn’t just a Madonna problem, this is a general problem on all levels of shows. If you put a Kid Rock in a House Of Blues they end up on [secondary] sites. This is a technology challenge. There is this incredibly sophisticated network of scalpers or ‘bots’ as we call them, around the world who have figured out the price of a ticket may have a higher value on the secondary exchange. That’s the over-riding economics driving the problem.
The core challenge is the bots are hitting the systems of all ticket buyers and all ticket companies and all shows and have been able to reserve seats and buy seats and put them on the exchange. If Kid Rock wants a $79 ticket going to a fan in a fair, direct manner, there’s still going to be an immense amount of demand for that ticket, and a lot of consumers still may not end up getting a seat, but we’d like to make sure that the even if you couldn’t buy a ticket, you had a damn good shot at getting a ticket and you were not competing against bots.
For certain shows, there is enough demand without the bots where a lot of fans come away empty-handed, at least for the best seats.
Unfortunately we’re in an industry that, unlike any other industry, we do not just run pricing of a product directly in correlation to market demand at all times. In any other industry if [a business] figures out a product can be sold at a certain level, they price it at that level. But we are in an industry where we work for the artist, and an artist has varying views, and balances the economics versus what he believes is the right price for his fan to pay, and that sets the price.
Whether we believe it should be a bit higher or not, that’s the price the artist wants to deliver his fans, so our job is to figure out the most secure, legal, environment where their fans have a shot to get that ticket. The front row isn’t five miles long, so we’re not going to make everybody happy. But we’ve all learned that in life if you feel you have a fair shot at the lottery, if you don’t win, you walk away disappointed, but at least believing you have a shot next time. Right now, all the illegal bots and the speculative selling are getting in the way of the artist-fan relationship and creating this whole new layer of a pissed off consumer that doesn’t feel he had a shot at a ticket.
Continue reading the rest of the story on Billboard