(Illustration by Ray Bartkus)
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.
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Billboard.biz: When it comes to fan club presales, I hear a lot of complaints of resellers just joining the fan club to get those tickets.
Michael Rapino: I agree. We have created a lot of easy entry doors for scalpers to access the show.
This is like the record business bitching about piracy back in the day, but nobody in the record business went out and figured out how to go out and create iTunes. There's going to be a lot of bitching, but it's not going to go away. It's going to be solved by some great technology ideas about how to better deliver selling on the onsales. We at Ticketmaster are the only ticketing company, I believe, that has anywhere near the R&D and investment in how we're going to create better rules, how we're going to develop anti-bot software, which we're spending millions on, how we're going to scrub IP addresses to kick bad IPs off the onsale and let the consumer in. There's a lot of people trying to figure out how to sell tickets at an onsale or process a ticket; to me that battle is long over. Finding a software that works is the easy part. The tough part is getting to the level of sophistication that Ticketmaster has gotten to now in terms of having a chief security officer that's spending night and day looking at IP addresses coming in, kicking out bad IP addresses, doing research and algorithims to figure out where all the bad IPs coming from, is there a trend here on bots, can we move them out.
We're going to continue to spend a lot of money on our security system to keep the bots from breaking into the bank, as well as product development, Fans First, seat locks, better tools for the artists to go on sale in a secure manner. We've got to be smarter and faster and more technology-savvy to solve this.
Some of your detractors have said Ticketmaster's efforts here are about controlling the secondary market, do you care to respond to that?
We work for the artist. We want to do whatever is right for the artists and his view of selling tickets to his fans. And the artists have different views of how they want to sell tickets, and through which channels and price points. An artist may say, "I only want to charge a certain price, I don't want to do $750 tickets, I don't want to do platinum seats, VIPs, any presale, I just want to make sure it's a low price and fair ticket," and we want to deliver that for them. And to deliver that for means you have to have incredible controls and protection around that ticket so it doesn't get sold and resold at prices the artist doesn't want.
If an artist says, "I want to figure out how to dynamically price and I want to participate in some of the higher-end revenue so I can have a lower end ticket price," we have to deliver that in our various sales channels. We're not looking to control anything, but we're absolutely looking to deliver what the artist wants for his fans and to make those two pieces come together in the right way. If that means going paperless to limit a Bruce Springsteen ticket from being sold at a higher price, then we want to deliver that to Bruce Springsteen. If it means an artist wants a $750 ticket in a platinum series, then we want to be able to offer that price point on our platform or others. It has nothing to do with control.
It could mean an artist may want to sell tickets on StubHub. If that's the case, should that be transparent?
They should be transparent, but I'd look at it differently. If you look at the rest of the world, there are not a lot of industries that have the infrastructure to market, buy, sell, promote a product, then have an adjacent industry disconnected from the factory selling just the premium products. It doesn't exist. Most industries try to price their product at whatever price point they have within their control, and then participate in all of the revenue.
We truly believe that ultimately the greatest experience for the consumer is [when] he comes to look for a ticket to a show and all the options are there for whatever price points. He doesn't have to go on a scavenger hunt to figure out if there's other ways to buy it, they're all in one place, and let the artist participate in all of that revenue. That's our job. There's no reason if that artist wants to participate in that high ticket price that he wouldn't want to control and be a part of that full sales process where all of his tickets are.
What we have to figure out as an industry is the more we can help the consumer feel like there's one shopping experience for the concert, versus multiple markets going on, the better we can build that trust again that 'I understand all the price points.' We think that ultimately the artist should be in control of all of his tickets and participate in all of the revenue, and probably have them in all in one marketplace.