Taylor Swift Gets Ticketmaster to Delist Resale Tickets for First Leg of Reputation Tour in Final Sales Push

Jay Z & Taylor Swift
Getty Images; Design by Jessica Xie

Jay Z & Taylor Swift

A lack of sellouts for tours led by Swift and Jay-Z highlights a growing competition between artists and scalpers.

When Taylor Swift's team negotiated with Ticketmaster last fall to power the Taylor Swift Tix platform for her Reputation Tour, there was a sticking point, sources tell Billboard: Her camp didn't want the ticketing giant to display tickets resold by scalpers alongside her primary tickets when she put them on sale to the public.

But Ticketmaster, which reaps bigger margins from secondary sales on its platform than it does on primary sales, argued that showcasing resale seats out of the gate would increase traffic and lead to more primary ticket sales, prevailing on a deal point that ultimately allowed season ticket holders, brokers and fans with early ticket access to resell thousands of seats on the same platform where Swift would sell tickets to fans who hadn't participated in her music- and merchandise-boosted presale.

Having buyers visit Ticketmaster's website, only to find a show is sold out with no ticketing inventory available, is akin to "putting up a Closed sign and telling them to go to StubHub," said Michael Rapino, CEO of Ticketmaster parent Live Nation, in a January interview with Billboard.

But as Swift gears up to take the stage at University of Phoenix Stadium in Glendale, Ariz., on May 8, none of her shows have sold out, with thousands of tickets still available in some locations. Under pressure from her team, Ticketmaster reversed course on April 27, turning off the resale ticket listings for her first nine shows and reducing prices in many markets as part of an effort to sell remaining inventory. The tour has since seen a significant lift in primary ticket sales, sources tell Billboard. (Ticketmaster, tour promoter AEG and Swift's camp declined to comment.)

The reversal comes as Live Nation faces increasing scrutiny over its market power as the world's largest concert promoter; its Ticketmaster unit has steadily increased its share of North American music ticketing, inking a deal on April 30 with venue operator SMG Europe's U.K. venues including Manchester Arena, the site of the May 2017 attack on an Ariana Grande concert. An April 1 New York Times article alleging possible antitrust violations sent Live Nation's stock tumbling 13 percent, prompting a race between attorneys to certify a class-action lawsuit on behalf of shareholders. (Live Nation denied the allegations, and in a blog post, Ticketmaster president Jared Smith said that his company's dominance "is the result of Live Nation's ongoing commitment to invest hundreds of millions of dollars into Ticketmaster.")

As for Swift, her 51-date stadium run will still be one of the top tours of 2018 and the highest-grossing one of her career, with more than $240 million worth of tickets already sold and $300 million projected to sell in total. But the lack of sellouts has given other artists pause about utilizing a similar strategy, highlighting the growing competition between acts and scalpers on the same seating charts.

"Artists are seeing the money Taylor is bringing in, but they're also seeing the negative headlines," one national promoter tells Billboard. "If it's a choice between making more money or avoiding bad press, some artists will take less just to ensure tickets quickly sell out and there isn't any chatter about soft demand."

JAY-Z faced such chatter on his 4:44 Tour in December 2017, with high-priced tickets generating record grosses for the rapper, but no sellouts -- likely a product of scalpers skipping the show because they couldn't make a profit. JAY-Z and Beyonc√©'s upcoming On the Run II Tour also is seeing some softness in the stadiums it's playing this summer, with plenty of tickets still available for the tour's U.S. opening in Cleveland (July 25) and thousands of seats still up for sale for second-night shows in cities with two performances, including New York, Chicago and Washington, D.C.

Artists have tried a range of tactics in recent years to get their tickets directly into the hands of fans before scalpers, who make the most money when the demand for tickets outweighs the supply of tickets available to the public. Garth Brooks often plays enough shows at each venue to exhaust demand, believing that if there's always a ticket available on the primary market, fans won't have to buy from brokers to attend. Bruce Springsteen, Harry Styles, Dead & Company and Ed Sheeran all recently utilized Ticketmaster's Verified Fan platform to reduce the resale of their tickets; Eric Church has his managers at Q Prime regularly comb ticket-sale reports to identify and cancel tickets believed to be held by scalpers.

Live Nation has increasingly tried to contain the profits of companies like StubHub and bought Tickets Now in 2008, eventually rebranding it TM+ as a way to increase its share of the $8 billion secondary market, and Ticketmaster and Live Nation have been lumping primary and resale tickets together. Often, when consumers log into an on-sale, they immediately find tickets listed by brokers, season ticket holders and others with early access to tickets.

But Live Nation's listing of secondary inventory on Ticketmaster when primary tickets are still available has irritated some promoters, who take a financial hit if the primary seats don't sell, and worry that resale tickets could cannibalize sales to their events. (Live Nation can mitigate losses on tours it promotes with the resale fees that it charges on Ticketmaster.)

Artists don't earn money directly from the reselling of seats, but in an April meeting with Billboard, Smith said that some of the income generated from secondary tickets was used for search engine optimization, which lifts primary ticket sales. Because margins are so small in primary ticketing, he said, the only revenue available for marketing tickets comes from the fees the company charges for secondary tickets. Secondary sales also offset the costs of Verified Fan, slowing ticket sales over multiple days to root out scalpers and resellers. Monitoring sales transaction by transaction takes significant resources, said Smith.

David Marcus, who oversees Verified Fan, said in January that the goal of the program was not for a Swift show to sell out seconds after going on sale, "but to sell the last ticket to her concert when she takes the stage each night." Whether her tour will be able to achieve that goal now remains to be seen.

This article originally appeared in the May 5 issue of Billboard.

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