Ticket scalping: My commentary on Trent Reznor’s post

It dates from 2009 March, but I just recently found a nin.com forum post where Trent Reznor rants a bit about ticket scalpers. Trent really explains everything that’s wrong with the current system of Ticketmaster, Live Nation, and the venues they partner with.

Loaded or not, I’m using the word “scalpers” to refer to ticket resellers. I believe ticket resale above face value is bad for the fans of artists who just want to see the show and is inherently an evil and greedy practice.

I’m going to quote bits and pieces of the post here and add my thoughts:

NIN decides to tour this summer. We arrive at the conclusion outdoor amphitheaters are the right venue for this outing, for a variety of reasons we’ve throughly considered*. In the past, NIN would sell the shows in each market to local promoters, who then “buy” the show from us to sell to you. Live Nation happens to own all the amphitheaters and bought most of the local promoters – so if you want to play those venues, you’re being promoted by Live Nation.

This smacks of anti-competitive behavior. Except for the fact this appears to primarily be occurring on a local level, I’m surprised the DOJ hasn’t stepped in to stop these shenanigans. Maybe they still can.

Now we get into the issue of secondary markets for tickets, which is the hot issue here. The ticketing marketplace for rock concerts shows a real lack of sophistication, meaning this: the true market value of some tickets for some concerts is much higher than what the act wants to be perceived as charging. For example, there are some people who would be willing to pay $1,000 and up to be in the best seats for various shows, but MOST acts in the rock / pop world don’t want to come off as greedy pricks asking that much, even though the market says its value is that high. The acts know this, the venue knows this, the promoters know this, the ticketing company knows this and the scalpers really know this. So…

As usual in the music business, the actual artists are the good guys here. The venue, promoters, and ticketing company who also know this are the ones that see nothing but dollar signs. How many of you would honestly pay a $500 to $1,000 face value plus fees (the latter of which I have ranted about before)?!

“Market value” is a rather touchy subject. I believe the so-called market value does not always represent a truly fair deal for everyone. The scalpers love being able to resell tickets at markups approaching 80% of face value, or beyond in some cases (that is, $250 for $50 tickets, where the markup is 80% of the scalper’s price). In fact, a 95% markup for scalpers is not entirely unheard of.

The venue, the promoter, the ticketing agency and often the artist camp (artist, management and agent) take tickets from the pool of available seats and feed them directly to the re-seller (which from this point on will be referred to by their true name: SCALPER). I am not saying every one of the above entities all do this, nor am I saying they do it for all shows but this is a very common practice that happens more often than not. There is money to be made and they feel they should participate in it. There are a number of scams they employ to pull this off which is beyond the scope of this note.

Note Trent’s use of the word “scams.” I think that more than adequately summarizes what is going on here, but of course, the real devil is in the details because that’s where we figure out what can be done about it.

Here’s the rub: Ticketmaster has essentially been a monopoly for many years – certainly up until Live Nation’s exclusive deal ran out. They could have (and can right now) stop the secondary market dead in its tracks by doing the following: limit the amount of sales per customer, print names on the tickets and require ID / ticket matches at the venue.

So we know there’s a solution. Ticketmaster has the power to make the concert ticket buying experience a much better and fairer one for fans who are honestly getting screwed by the current system.

We know this works because we do it for our pre-sales. Why don’t THEY do it? It’s obvious – they make a lot of money fueling the secondary market. TicketMaster even bought a re-seller site and often bounces you over to that site to buy tickets (TicketsNow.com)!

So, it’s not enough for Ticketmaster to make their money by being in cahoots with the scalpers these days. They now own some of the scalpers too! Can you say “greedy?”

NIN gets 10% of the available seats for our own pre-sale. We won a tough (and I mean TOUGH) battle to get the best seats. We require you to sign up at our site (for free) to get tickets. We limit the amount you can buy, we print your name on the tickets and we have our own person let you in a separate entrance where we check your ID to match the ticket. We charge you a surcharge that has been less than Ticketmaster’s or Live Nation’s in all cases so far to pay for the costs of doing this – it’s not a profit center for us. We have essentially stopped scalping by doing these things – because we want true fans to be able to get great seats and not get ripped off by these parasites.

I assure you nobody in the NIN camp supplies or supports the practice of supplying tickets to these re-sellers because it’s not something we morally feel is the right thing to do. We are leaving money on the table here but it’s not always about money.

The NIN camp is doing a commendable thing here. It’s not always about money. To be fair, even Ticketmaster, in the months since this was written, appears to have rolled out paperless ticketing at least for some shows. I’d like to think this is not just a passing fad.

The bitter irony here is that the arts scene (orchestra, ballet, opera, etc.) has always fought the perception of being expensive. The most expensive ticket for a SPA (Society for the Performing Arts) show this season is $65; it wouldn’t surprise me if something somewhere goes into triple digits ($100+) per ticket, but I’d expect that to be rather rare.

On the other hand I’m pretty sure $100 for a rock concert ticket is frighteningly common.

My guess as to what will eventually happen if / when Live Nation and Ticketmaster merges is that they’ll move to an auction or market-based pricing scheme – which will simply mean it will cost a lot more to get a good seat for a hot show. They will simply BECOME the scalper, eliminating them from the mix.

I certainly hope this doesn’t happen. This would be a truly bad thing for the fans. I believe tickets should be available at a fair, fixed, affordable price.

I don’t see arts organizations ever doing this. You rock concert guys want to go to auction-based pricing? Fine. I’ve always wanted to see the Wortham Center and similar venues sell out for a ballet or opera. And it’s not to say that most of the younger set will suddenly dump rock for Bach. It certainly wouldn’t be a bad thing, however, for the evil concert cartel to shoot themselves in the foot and for a few in the younger set to wind up really getting some culture in the process (and I don’t mean a fad yogurt diet, either).

The ultimate way to hurt scalpers is to not support them. Leave them holding the merchandise.

I feel for the artists that will play to half-empty venues because the fans that just want to pay a fair price to see the show are unable to because the scalpers have bought up all the tickets, and refuse to support a system that is so corrupt it almost makes the Mafia look squeaky clean.

In summary, I wish Trent and NIN the best of luck in the good fight, and hope that Ticketmaster is truly serious about stopping scalpers instead of just making a token effort to try to shut up people like me. My regular readers should know by now how I feel about censorship and insincerity; if I encounter either, this won’t be the last rant about the industry.

The shell game played by ticketing service providers

Two recent posts I’ve read, this one from Jeff Balke and this one from TicketStumbler (Edit 2021-06-14: archived version), got me curious about the fees that Ticketmaster charges.

Very telling indeed are quotes like these from Jeff:

But, $8.60 PER TICKET for “convenience charges???” What the hell is convenient about that?

and this one from the TicketStumbler article:

But, this isn’t all Ticketmaster’s fault. Ticketmaster has tried switching to a pricing model where all or most of the convenience fees are built in to the face value ticket price. The end price would be the exact same, but the ticket buying experience would be significantly more transparent and mostly spared of backloaded fees. Unfortunately, this sort of pricing structure has been met with opposition from the artists and venues who don’t want to raise prices, or rather don’t want the appearance of raising prices. When the face value cost is lower, it’s much easier for the artists and venues to shift blame towards Ticketmaster for “excessive fees” even if the artists and venues are getting a cut.

I’m not sure where the blame really lies here. It seems like a huge finger-pointing game between Ticketmaster (or Live Nation, etc), the artists, and the venues. Ticketmaster tries transparency, and the artists and venues cry foul because it looks like the prices went up, even though it always cost in the neighborhood of $40-42 to buy what is labeled a $30 ticket.

It’s sad to say, but the only answer here may be truth-in-advertising legislation, to level the playing field for everyone. I can understand why people avoid some concerts; this is a shell game that ticketing agencies should not be allowed to play. I would deem one of two solutions to be more acceptable and fair (and I’m using a generic “Provider” to include Ticketmaster, Live Nation, and similar services for neutrality):

  1. Roll the fees everyone pays no matter what into the ticket’s face value, and allow Provider to show a separate line-item convenience fee specifically for their service. Ideally, this would be labeled “Provider’s convenience fee” (or whoever is doing the ticketing) with a full disclosure to include wording similar to “Provider charges a convenience fee for their service, and this is the only amount Provider keeps. The face value of the ticket goes to the artist and venue.” This fee would include what is today charged as part of the convenience fee and order-processing fee (if the graphic in the TicketStumbler post is taken as truth).

  2. Roll all fees into the ticket’s face value, and offer discounts off of this for multiple ticket orders or venue box office transactions. In this case a full disclosure would read along the lines of “The ticket price includes convenience and processing fees charged by Provider. Ticket prices may be lower through the venue’s box office or other services.”

Either way, fees like the TicketFast fee are outrageous and should be barred by law. This actually saves Ticketmaster and others that offer a similar option money by allowing one to print one’s own tickets at one’s own computer.

(I have heard of the convenience fee being charged even to those buying tickets at the venue, but was unable to locate a specific example. If anyone knows of one, please do comment or send me a message via the contact form.)