Outbox Technology, the Montréal-based computerized ticketing firm, announced today the appointment of Fred D. Rosen as CEO of its newly created U.S. entity, Outbox Enterprises LLC.
The appointment was made by Jean-Françoys Brousseau, founder and CEO of Outbox Technology. Rosen is best known as the architect of Ticketmaster’s rapid growth in the late 1980s through the 1990s to become the dominant ticketing company in the world. Rosen left his post as CEO of Ticketmaster in 1998.
As CEO of Outbox Enterprises, Rosen will collaborate with Brousseau to manage Outbox’s business operations in North America and expand the company’s presence in event ticketing worldwide. He will be based at the company’s new offices in Los Angeles.
The Outbox ticketing model is based on a “white-label” solution that allows the venue to brand its own ticketing operation and own more flexibility on how tickets are sold. “The buildings have control of setting service charges when they go on sale,” says Rosen. “The real issue here underneath it all is you have two people who have extensive knowledge in ticketing, both from marketing and operations viewpoint, who know how to scale a business and know how to operate a business.”
The Outbox platform manages and processes multi-language and multi-currency worldwide ticket sales for Cirque du Soleil, as well the Montréal Canadiens, the Bell Centre in Montréal, and the Kodak Theatre in Los Angeles.
Brousseau was founder and president of Microflex and Admission Network in Canada, and led those companies until their sale to Ticketmaster. He founded Outbox Technology in 2005, in partnership with Cirque du Soleil, to develop tools and services designed to bring facilities and promoters closer to ticket buyers.
Launched five years ago, Broussard says Outbox was conceived with “the idea that an alternative, more modern solution to ticketing was something that the niche players in the industry were looking for, some of the promoters and venues that have special needs.” With the success of the Cirque du Soleil partnership, Outbox became the ticketing company for the 21,500-capacity Bell Centre in Montreal, home of the NHL’s Canadiens.
“Jean-Francois and I had been talking for five months before we did this, so this is not something we did overnight but something we approached very carefully in terms of determining whether we wanted to be in business, looking at the competitive landscape, and looking at the guys who are out there,” says Rosen. “If you look at all the other ticketing companies, the truth of the matter is there is one dominant ticketing company and everybody else is still around the fringes.”
Ticketmaster merged with Live Nation in a deal that was consummated earlier this year (and includes Irving Azoff’s Front Line Management firm), and Rosen says Ticketmaster has evolved from when he steered the company and built a model where the venues were the clients and service fees were created to offer rebates to the buildings, turning ticketing from a cost-center to a revenue stream.
“Ticketmaster was created in a manner where the buildings were the clients and the company clearly was in position to protect the building,” Rosen says. “In all of the different deals that have evolved today, Ticketmaster’s role is significantly different. It is much more on the side of the acts. The smartest guy in the music business is Irving [Azoff], he’s the best manager in the business. But Ticketmaster’s role as a protector of the buildings has clearly shifted.”
Like most ticketing companies, including “white label” companies that are branded with the venue, Outbox operates on a revenue-sharing model with the venue clients. “This is a very hard business with serious business disciplines attached to it, and very few of these companies that are doing white label solutions are making any money,” Rosen says.
The key, according to Rosen, is for fans to be able to buy tickets at the venue website. “The fact is when buildings discover that they can do transactions on their own websites, it makes all their websites significantly more valuable,” he says. “Because when you do transactions within a website, you’re keeping that customer. When I say the ‘middle man model is dead,’ it’s not dead for Ticketmaster yet, but it’s dead for anybody to show up and say ‘I’m creating Marvin’s Ticketing Company.’ There’s not going to be another brand created, that’s over.”
It is true that technology has eliminated many of the barriers to entry that once existed, primarily in the means of e-commerce and distribution. Rosen believes Outbox is positioned to seize the opportunity for growth.
“We don’t expect it to be easy but we do believe the business is ripe for change, that people are open to change, and that the Internet has disintermediated the old outlet/telephone model, where you needed big distribution systems to survive and compete,” Rosen says. “When you look at the experience the two of us have, I think we’ll be involved with marketing with people, we can bring a level of expertise both in the front and the back that no other ticket company can deal with. It goes back to that old business of ticket companies being Switzerland, not to take sides, the client is the client, and the client in this case are the facilities or the theaters. You wear one hat.”