Can Ticketmaster’s Hold on Online Tickets Ever Be Broken?
The Internet has changed a lot of things, including the way we buy tickets to rock concerts, sporting events and Broadway shows. But one thing hasn’t changed much at all: Ticketmaster’s iron-fisted grip on the ticket-sales industry.
Even online, ticket-selling competition is a hard thing to come by. So can Ticketmaster’s hold on online ticket sales ever be broken?
History
Based in California, Ticketmaster first started selling tickets in 1976. The company, now a subsidiary of Live Nation Entertainment, typically contracts with event promoters and sells their tickets. To pay for its role in the transaction, Ticketmaster charges a service fee on top of the price of the ticket, rather than taking any part of the ticket price itself. This practice has drawn intense controversy, since it often drives up the price of tickets sharply.
Competition
On top of which, Ticketmaster has little if any competition in most of the markets it serves, leaving consumers little choice but to pay the service fees. Here and there independent ticket agents offer alternatives, but because Ticketmaster negotiates exclusivity agreements with most of its clients, such competition is rare.
Buying online may impact the amount of the service fee one pays Ticketmaster, but so far at least, it hasn’t impacted whether one has to pay the fee in the first place. So how likely is it that this will change as time goes by? At least in the near future, it is not very likely.
Exclusivity
Ticketmaster is a behemoth, but the key problem isn’t size but rather exclusivity. As long as Ticketmaster and its clients can legally agree that the clients won’t use any other ticketing agents, Ticketmaster can shut out competition. And since Ticketmaster is the big kid on the block when it comes to handling ticket sales, promoters are likely to choose Ticketmaster over smaller competitors who don’t have the same track record and facilities. Ticketmaster has also spent the last decade and more buying up smaller competitors, making the field even barer.
Exclusivity has been the name of the game since the early 1980s for Ticketmaster, and it has become so standard that most promoters simply go along and agree to use Ticketmaster exclusively for all their events. This, together with the imposition of service fees, has led to high-profile complaints of monopolistic behavior, including a famous 1990s spat between Pearl Jam and Ticketmaster that went to the Justice Department. Pearl Jam attempted to circumvent Ticketmaster and organize a concert set entirely at venues that didn’t use the ticket giant. As in most such cases, Ticketmaster won out.
Future
There are no signs of impending change now that Internet sales dominate the market. Ticketmaster’s computer models have adapted well to online sales models, and the Web hasn’t threatened to ease the grip of exclusivity agreements, or to chip away at service fees. In 2008 Ticketmaster was allowed to buy a company with related applications despite antitrust concerns, and in 2010 the company was allowed to merge with a concert-promotions company, both signs the government is unlikely to step in and break Ticketmaster’s hold on online ticket sales.
And with the consumer’s options usually buy through Ticketmaster or don’t go to the show, protesting with your wallet isn’t even an option. Any worthwhile competitors quickly fall victim to the buy-out so you can expect to see Ticketmaster in charge for a long time to come.
Frank Anderson works with exchange hosting and other hosting related fields. He also is a writer and blogger for technology and marketing blogs.
Posted in Social Networking. Tags: niche social networking, tickets
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