August 13, 2013
Live Nation Entertainment and its Ticketmaster subsidiary will now offer tickets to be sold by resellers via its new TM+ feature. In order for the new platform to succeed, Live Nation and Ticketmaster must convince resellers, rather than competitors, to use it. The two companies have been looking to boost their role in the $4 billion per year concert ticket reselling market, currently dominated by scalpers and brokers that buy tickets at face value, then resell them for a profit on sites such as eBay’s StubHub.com.
TM+, currently in beta, merges the ticket resale business with its main ticketing service. The venture lowers the boundaries between the face value and secondary ticket markets.
Ticketmaster has been unsuccessful in several attempts to compete against resellers and StubHub. TicketExchange and an acquired site, TicketsNow, both failed. Ticketmaster also attempted a joint venture with several large ticket resellers, but it failed after a limited trial.
“Live Nation and Ticketmaster officials testified before a congressional subcommittee in 2009 about the evils of scalping and how it should be kept separate from the primary marketplace, if not outlawed altogether,” explains The Wall Street Journal. “Now, the combined company says it is committed to making resale ‘fan friendly’ — a way to give ticket buyers as many options as possible.”
TM+ informs users when tickets are a resale, ensures their legitimacy and offers immediate download. Consumers have the convenience of buying tickets at a single source, and it may reduce speculative selling, where tickets are scalped for inflated prices with vague locations. Fees will be a major revenue source of TM+.
“Live Nation is able to reap fees three times on such tickets: a percentage that is tacked on to the original purchase price, a resale commission and a final fee, the latter two from the consumer purchasing the resale tickets,” describes WSJ. “It also collects fees from brokers who opt to use its new reselling software.”
The merging of the ticket market could reduce the supply of face value tickets, suggests some economists and scholars. Ticket brokers also criticize the new venture, saying that it will give Live Nation unfair pricing control over tickets.