Ticketing
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After warning fans in a tweet spree earlier this week that Ticketmaster’s “Verified Fan” system was “far from perfect,” The Cure singer Robert Smith continued his Twitter rant on Thursday after his band’s 30-date Shows of a Lost World North American tour went on sale.
“I AM AS SICKENED AS YOU ALL ARE BY TODAY’S TICKETMASTER ‘FEES’ DEBACLE,” Smith raged in his latest all-caps broadside against Ticketmaster. “TO BE VERY CLEAR: THE ARTIST HAS NO WAY TO LIMIT THEM. I HAVE BEEN ASKING HOW THEY ARE JUSTIFIED. IF I GET ANYTHING COHERENT BY WAY OF AN ANSWER I WILL LET YOU ALL KNOW.”
Smith’s tweet came as fans complained that despite the band offering reasonably priced tickets for the outing and making sure the tickets will be non-transferable to minimize resale and keep prices at face value, in some cases the added-on service fees, facility charges and order processing fees added up to more than the cost of entry.
By making the tickets non-transferable, scalpers will be unable to purchase tickets and then resell them for a profit since the original owner will have to be present to enter the venue. For fans who purchase tickets but can’t make it to the event, they will be able to resell the ticket on a face-value ticket exchange.
Before the VF onsale, Smith assured fans that he was doing everything he could to alleviate ticketing pain points, including avoiding platinum packages and dynamic pricing, referring to those practices as “a bit of a scam.” But when he saw the complaints about the service charges during Thursday’s onsale, the singer could not hold back; at press time a spokesperson for Ticketmaster had not returned Billboard‘s request for comment.
Following up on his “scam” tweet, on Wednesday (March 15), Smith explained, “I HAD A SEPARATE CONVERSATION ABOUT ‘PLATINUM’, TO SEE IF I HAD MISUNDERSTOOD SOMETHING… BUT I HADN’T! IT IS A GREEDY SCAM – AND ALL ARTISTS HAVE THE CHOICE NOT TO PARTICIPATE… IF NO ARTISTS PARTICIPATED, IT WOULD CEASE TO EXIST.”
If nothing else, Smith implored his fans to avoid buying tickets secondhand from scalpers, writing, “I HAVE BEEN TOLD: StubHub has pulled listings in all markets except NY, Chicago, Denver (IE. CITIES IN STATES THAT HAVE LAWS PROTECTING SCALPERS). PLEASE DON’T BUY FROM THE SCALPERS – THERE ARE STILL TICKETS AVAILABLE – IT IS JUST A VERY SLOW PROCESS… I WILL BE BACK IF I GET ANYTHING SERIOUS ON THE TM FEES… IN THE MEANTIME, I AM COMPELLED TO NOTE DOWN MY OBVIOUS RECURRING ELEPHANT IN THE ROOM THOUGHT… THAT IF NO-ONE BOUGHT FROM SCALPERS… THEN.”
The Cure’s efforts to combat resale ticketing comes after a season of in-demand tours facing astronomical price increases due to dynamic ticketing and scalpers. Ticketmaster is currently facing government inquiries into its handling of the disastrous Taylor Swift Eras Tour presale, which left many fans outraged when service delays and website crashes (caused in part by bots) prevented many of them from securing tickets.
See Smith’s tweets below.
I AM AS SICKENED AS YOU ALL ARE BY TODAY’S TICKETMASTER ‘FEES’ DEBACLE. TO BE VERY CLEAR: THE ARTIST HAS NO WAY TO LIMIT THEM. I HAVE BEEN ASKING HOW THEY ARE JUSTIFIED. IF I GET ANYTHING COHERENT BY WAY OF AN ANSWER I WILL LET YOU ALL KNOW. X— ROBERT SMITH (@RobertSmith) March 16, 2023
WHAT I MEANT BY THIS BIT WAS… I HAD A SEPARATE CONVERSATION ABOUT ‘PLATINUM’, TO SEE IF I HAD MISUNDERSTOOD SOMETHING… BUT I HADN’T! IT IS A GREEDY SCAM – AND ALL ARTISTS HAVE THE CHOICE NOT TO PARTICIPATE… IF NO ARTISTS PARTICIPATED, IT WOULD CEASE TO EXIST X https://t.co/Kj7hjkRGn1— ROBERT SMITH (@RobertSmith) March 15, 2023
I HAVE BEEN TOLD: StubHub has pulled listings in all markets except NY, Chicago, Denver (IE. CITIES IN STATES THAT HAVE LAWS PROTECTING SCALPERS). PLEASE DON’T BUY FROM THE SCALPERS – THERE ARE STILL TICKETS AVAILABLE – IT IS JUST A VERY SLOW PROCESS… X— ROBERT SMITH (@RobertSmith) March 16, 2023
Robert Smith is explaining the serious measures The Cure is taking to avoid outrageous ticket prices for their upcoming North American tour. In a shot across the bow at re-sellers, when the tickets for the 30-date run of Shows of a Lost World Tour went on sale Wednesday morning (March 15) to those who pre-registered using Ticketmaster’s Verified Fan system, will be non-transferrable in order to minimize resale and keep prices at face value.
The singer went on a tweet spree on Tuesday (March 14) in which he explicitly described how and why the veteran goth rockers decided to go their own way on this outing. “TM HAVE JUST TOLD ME ‘ALL tickets for The Cure Shows Of A Lost World Tour will be made available during tomorrow’s Verified Fan Sale,’” Smith tweeted, adding, “SEEMS THE RESPONSE TO REGISTRATION HAS BEEN PRETTY OVERWHELMING – THANKS! HOWEVER, I REALISE THERE ARE PROBLEMS, SOME MORE REAL THAN OTHERS…”
He then noted that the group had “final say” in all the ticket pricing for the tour, with Smith determined that those prices would not be “INSTANTLY AND HORRIBLY DISTORTED BY RESALE.” Smith referred to touts as being part of a “sophisticated business” expert at acquiring tickets and reselling them on marketplaces such as Vivid, Stubhub and Seatgeek.
Smith also revealed that the Cure were told that TM’s Verified Fan platform “has been used more than 400 times to qualify buyers and reduced the % of tickets on the secondary market” and that using VF has regularly reduced scalping by 80%, with less than 5% of tickets typically ending up on the secondary market.
By making the tickets non-transferable, scalpers will be unable to purchase tickets and then resell them for a profit since the original owner will have to be present to enter the venue. For fans who purchase tickets but can’t make it to the event, they will be able to resell the ticket on a face-value ticket exchange.
“WE WERE CONVINCED THAT TICKETMASTER’S ‘Verified Fan Page’ AND ‘Face Value Ticket Exchange’ IDEAS COULD HELP US FIGHT THE SCALPERS,” Smith wrote. “(WE DIDN’T AGREE TO THE ‘DYNAMIC PRICING’ / ‘PRICE SURGING’ / ‘PLATINUM TICKET’ THING… BECAUSE IT IS ITSELF A BIT OF A SCAM? A SEPARATE CONVERSATION!).”
When the band announced the world tour earlier this week, they established that “there will be no ‘Platinum’ or ‘Dynamically Priced’ tickets on this tour,” which includes stops at Hollywood Bowl in Los Angeles, Moody Center in Austin, Madison Square Garden in New York and State Farm Arena in Atlanta.
The singer also tweeted that though TM’s Verified Fan is a “far from perfect system,” the reality is that if there aren’t enough tickets on sale, some fans will miss out no matter what system the Cure use. “At least this one tries to get tickets into the hands of fans at a fair price,” he said. In the final comment in the Twitter run, Smith noted he’d been told that TM will continued to sell tickets to Verified users “until there are no more tickets to sell.”
The Cure’s efforts to combat resale ticketing comes after a season of in-demand tours facing astronomical price increases due to dynamic ticketing and scalpers. Ticketmaster is currently facing government inquiries into its handling of the disastrous Taylor Swift Eras Tour presale, which left many fans outraged when service delays and website crashes (caused in part by bots) prevented many of them from securing tickets.
See Smith’s tweets below.
TM HAVE JUST TOLD ME “ALL tickets for The Cure Shows Of A Lost World Tour will be made available during tomorrow’s Verified Fan Sale” SEEMS THE RESPONSE TO REGISTRATION HAS BEEN PRETTY OVERWHELMING – THANKS! HOWEVER, I REALISE THERE ARE PROBLEMS, SOME MORE REAL THAN OTHERS…— ROBERT SMITH (@RobertSmith) March 15, 2023
WE HAD FINAL SAY IN ALL OUR TICKET PRICING FOR THIS UPCOMING TOUR, AND DIDN’T WANT THOSE PRICES INSTANTLY AND HORRIBLY DISTORTED BY RESALE – WE WERE TOLD “In North America the resale business is a multi-billion $ industry.— ROBERT SMITH (@RobertSmith) March 15, 2023
The touts are sophisticated businesses that are expert at acquiring tickets, and the major marketplaces like Vivid, Stubhub and Seatgeek spend tens of millions of dollars on marketing. The touts get an unfair share of tickets and resell them on these marketplaces.”— ROBERT SMITH (@RobertSmith) March 15, 2023
WE WERE TOLD “Ticketmaster’s Verified Fan platform has been used more than 400 times to qualify buyers and reduce the % of tickets on the secondary market.— ROBERT SMITH (@RobertSmith) March 15, 2023
Using Verified Fan scalping is regularly reduced by 80%, with typically fewer than 5% of tickets on the secondary market after a Verified Fan campaign. Listed below are a few of the artists who have effectively used VF to limit resale.”— ROBERT SMITH (@RobertSmith) March 15, 2023
WE WERE CONVINCED THAT TICKETMASTER’S “Verified Fan Page” AND “Face Value Ticket Exchange” IDEAS COULD HELP US FIGHT THE SCALPERS— ROBERT SMITH (@RobertSmith) March 15, 2023
(WE DIDN’T AGREE TO THE ‘DYNAMIC PRICING’ / ‘PRICE SURGING’ / ‘PLATINUM TICKET’ THING… BECAUSE IT IS ITSELF A BIT OF A SCAM? A SEPARATE CONVERSATION!)— ROBERT SMITH (@RobertSmith) March 15, 2023
WE KNOW IT IS A FAR FROM PERFECT SYSTEM – BUT THE REALITY IS THAT IF THERE AREN’T ENOUGH TICKETS ONSALE, A NUMBER OF FANS ARE GOING TO MISS OUT WHATEVER SYSTEM WE USE; AT LEAST THIS ONE TRIES TO GET TICKETS INTO THE HANDS OF FANS AT A FAIR PRICE…— ROBERT SMITH (@RobertSmith) March 15, 2023
The Cure is taking serious measures to avoid outrageous ticket prices for their upcoming tour dates. The band, which announced a 30-date run of shows earlier this week, took to social media Friday (March 10) to let fans (and scalpers) know that tickets for their Shows of a Lost World Tour dates will be non-transferable.
“We want the tour to be affordable for all fans, and we have a very wide (and we think very fair) range of pricing at every show,” the message said. “Our ticketing partners have agreed to help us stop scalpers from getting in the way; to help minimise resale and keep prices at face value, tickets for this tour will not be transferable.”
By making the tickets non-transferable, scalpers will be unable to purchase tickets and then resell them for a profit since the original owner will have to be present to enter the venue. For fans who purchase tickets but can’t make it to the event, they will be able to resell the ticket on a face-value ticket exchange.
Three states in the U.S. have outlawed non-transferable tickets, making it illegal for The Cure to uphold the practice for shows in New York, Illinois and Colorado. For those dates, the band encourages fans to only purchase tickets from face-value exchange platforms like Twickets and Cash or Trade.
“Fans should avoid buying tickets that are being resold at inflated prices by scalpers, and the sites that host these scalpers should refrain from reselling tickets for our shows,” the message reads.
The band went on to explain that any tickets listed as of today (March 10) on secondary ticketing sites are not legitimate. Scalpers will post tickets onto secondary ticketing platforms prior to a tour’s on-sale via a practice called speculative ticketing. When a fan pays for the “speculative ticket”, the scalper will acquire a ticket at a lower price once tickets actually go on sale and pocket the difference. The Cure has stated that they will work with Ticketmaster to cancel any tickets obtained via this method.
When the band announced the world tour earlier this week, they established that “there will be no ‘Platinum’ or ‘Dynamically Priced’ tickets on this tour,” which includes stops at Hollywood Bowl in Los Angeles, Moody Center in Austin, Madison Square Garden in New York and State Farm Arena in Atlanta.
Fans looking to secure tickets to The Cure’s 2023 tour should register with Ticketmaster’s Verified Fan program. Registration is open through Monday (March 13). After registering, fans will be entered into a lottery system to try to purchase tickets for their preferred date and location.
The Cure’s efforts to combat resale ticketing comes after a season of in-demand tours facing astronomical price increases due to dynamic ticketing and scalpers. Ticketmaster is currently facing government inquiries into its handling of the disastrous Taylor Swift Eras Tour presale, which left many fans outraged when service delays and website crashes (caused in part by bots) prevented many of them from securing tickets.
After weeks of strategizing how to salvage Ticketmaster’s reputation in the wake of last November’s Taylor Swift presale debacle and Live Nation president/CFO Joe Berchtold’s January grilling by the Senate Judiciary Committee, the ticketing giant’s parent company has settled on an approach that will ramp up lobbying to hit back at scalpers while educating consumers about ticketing fees.
Despite breaking two company records with the Nov. 15 The Eras Tour presale — the most tickets ever sold in a single day (2.4 million) and, according to the company, keeping 95% of those tickets off secondary sites like StubHub and SeatGeek — Ticketmaster found itself cast as the villain and Live Nation as a monopoly after a cyberattack disrupted over 100,000 transactions.
The outcry has led to a mixture of disbelief and self-reflection at Live Nation’s global headquarters in Beverly Hills, Calif. “The company enables music fans to connect with the world’s greatest artists through concerts and events that often become the cornerstone moments of people’s lives,” says a Live Nation executive who was not authorized to speak on the record. “Why the fuck do people hate us so much?”
Although the controversy over the Swift presale had to do with ticket availability rather than price — the prime complaint of Ticketmaster’s July 2022 Verified Fan sale of tickets to Bruce Springsteen’s 2023 tour — the executive says that Live Nation has determined that redeeming itself with consumers “starts with the fees,” which can add over 30% to the final price of a concert ticket.
“We’ve got to now go out and do a much better job so policymakers and consumers understand how the business operates,” Live Nation president/CEO Michael Rapino said during the company’s most recent investor call. “We’ve historically not had a big incentive to shout out loud that venues are charging high service fees or artist costs are expensive. But I think now [that] education is paramount.”
Ticketmaster’s main source of revenue comes from the fees it charges to process ticket transactions. A ticket’s face value goes to the artist, while the ticketing giant shares the fees it collects with the venues that contract for its services.
Ticketmaster typically keeps $2 to $5 per ticket for processing costs and a small portion of the fees it collects to recoup any loans, advances or bonuses it may have paid the venue to win its ticketing contract. Contracts for large venues can be worth millions of dollars. The balance of the fees collected goes to the venue, which uses the money to cover the cost of the show.
Traditionally, promoters book venues for artists, pay rent to use the space and hire its staff. What’s left over as profit is divvied up with the act, which typically receives 80% to 85% of that amount.
But as competition to book top-shelf headline talent has increased over the last decade, venues have reduced the rent they charge and promoters have agreed to take a smaller percentage of base ticket sales — sometimes as little as 5%.
As Rapino said on the investor call: “The artist takes most of that ticket fee base. So the way that the venue, the promoter or the ticketing company [earns its] revenue fees is through that extra fee.”
The increasing costs of concert production, which are borne by the promoter, have also wid- ened the gap between a ticket’s face value and the final amount charged after fees, which can induce sticker shock when two $100 tickets can end up costing $265. While it has been very profitable for Ticketmaster to cover more of a concert’s costs through these fees, it has helped turn ticket buyers against the company.
Ticketmaster executives are hoping a simple fix can solve the problem — showing the total cost of a ticket, face value plus fees, at the be- ginning of the checkout process. That method is already used in New York, where it is mandated by state law.
“We all want to know what is the true cost to see the show when we start shopping,” Rapino said on the call. “We wish that would be mandated tomorrow across the board [because] that would relieve a lot of the stress [and] the consumer’s perception that there’s this magical extra fee added on” that isn’t part of the overall show cost.
Ticketmaster and other ticketing companies have long debated whether to abandon what’s known as a “drip pricing” model but haven’t pulled the trigger because studies show that fans are more likely to make a purchase if the fees that are tacked onto the face value of a ticket don’t appear until checkout. Secondary-market ticketing companies have also adopted the practice, advertising tickets at prices below those sold on the primary market, then hitting consumers with a 35% to 45% markup at checkout.
In a move more closely tied to the Swift situation, Ticketmaster has also decided to target scalpers through legislation and proposed legislation called the FAIR Ticketing Act that would outlaw drip pricing and grant artists the ability to ban scalper websites from reselling their tour tickets. Support for the initiative includes all four major talent agencies, Universal Music Group and a number of management companies.
Pro-ticket scalping groups have proposed their own counter-legislation, effectively banning Ticketmaster from using its proprietary technology to stop scalpers. Neither bill has a congressional sponsor in either chamber of Congress, however, and unless that happens, neither has any chance of passing.
Ticketmaster does appear to have some serious muscle in its corner when it comes to the scalp- ing issue. In a February interview with Billboard, Gregg Perloff, founder and CEO of independent promoter Another Planet Entertainment, which produces San Francisco’s Outside Lands festival, said: “My question for [Congress] is, ‘Why are you picking on Ticketmaster and Live Nation when you should be outlawing brokers?’ They are the ones who screw up everything. Does every promoter take a few tickets? Does every venue have a few tickets? … Sure. But it’s the scalpers that make it so no one can get a decent seat except the rich. The Senate didn’t do the research they should have done before they started pontificating and acting like they knew what they were talking about.”
In addition, Perloff suggested that touring artists were partially responsible because they “really want to go on sale for the whole tour at once because they can advertise the whole tour at once and make a bigger splash.” Regarding Swift’s tour, he said, “There’s no system in the world — and this is where I have to defend Ticketmaster — that could have handled the onslaught.”
Also in February, at the Pollstar Live conference in Los Angeles, music mogul Irving Azoff and Madison Square Garden Entertainment chairman James Dolan took on pro-scalping journalist-podcaster Eric Fuller when he argued that scalping made tickets cheaper, citing discredited media reports of bargain bin-priced tickets available for Springsteen’s North American tour dates.
“It’s about a half-hour conversation, but you’re dead wrong,” Azoff told Fuller, who also operates a consulting business in ticketing.
“You got to take your hat off to this paid lobbying group that’s working for the scalpers,” Dolan chimed in. “These guys are pretty good. Maybe we should hire them.” In response, Fuller says Dolan’s comments are “grossly inaccurate.”
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Ticket fees have been called everything from “exorbitant” (Sens. Richard Blumenthal and Amy Klobuchar) to “completely bats—” (Last Week Tonight with John Oliver). And they can increase the price of a concert ticket by an average of 27-31%, according to a 2017 study by the U.S. Government Accountability Office.
Unfortunately for ticket buyers, those fees aren’t going anywhere quickly. They may change or disappear completely, but consumers won’t reap any savings in the end, Live Nation CEO Michael Rapino explained during Live Nation’s fourth quarter 2022 earnings call on Thursday.
Say, for example, a venue is prohibited from charging fees on top of a ticket’s face value. “Well, then the venue would say, ‘Okay, artists, the rent isn’t $50,000 anymore. It’s $100,000,’” Rapino said.
The ticket fee is a surcharge that helps cover a venue’s costs. Rapino’s point is that the venue needs to cover its costs, so it’s going to collect money to cover them, no matter what. In a normal scenario, the consumer helps cover those costs by paying a surcharge directly to the venue.
If fees were eliminated, artists — who are the final authority on primary ticket prices — would be forced to raise them to cover the additional cost. The surcharge may have disappeared, but that cost would still exist in the form of a higher face value. Regardless of the approach, the consumer’s expense and the venue’s revenues would be unchanged.
“The true cost of going to a show and making the show happen is the full price all-in,” said Rapino. The concept is apparent to anybody who has pondered how airlines set prices. If airlines charged an all-in fee that encompassed all its costs, ticket prices would be dramatically higher. Legislation that banned fees for checked baggage could result in higher prices for everything from flight themselves to in-flight beverages. Airlines that previously allowed free carry-on bags might start imposing fees on those. They could also charge more to change your travel plans (which used to cost the consumer nothing).
Rapino acknowledged that Live Nation, which owns and operates venues, would do the same. “If tomorrow someone said, ‘You know, you can’t charge 20% service fees on your amphitheater, you have to [charge] 10%.’ Well, then the $75,000 house rent that we charge artists would be $100,000,” he said as an example. Live Nation couldn’t simply absorb the cost, he explained. Since the company requires money to pay staff and operate the venue, it would find a way to recoup the lost fees.
While what consumers pay won’t change, they may get more transparency. In the wake of Ticketmaster’s disastrous Taylor Swift Eras Tour pre-sale, President Joe Biden unveiled an initiative to limit, among other types of fees, mandatory, back-end fees that “often hide the full price” of a good or service. The White House pointed to research that found hiding the full price encourages consumers to spend more than they would have otherwise.
Live Nation has also come out publicly — and forcefully — against hidden fees. On Thursday, Rapino called numerous times for the industry to adopt all-in pricing that show the ticket buyer a single price at the beginning of the transaction. Also on Thursday, Live Nation issued a press release that encouraged lawmakers to introduce legislation that includes, among other things, mandatory all-in pricing.
The uproar against Live Nation and Ticketmaster over ticket fees is just one of many criticisms to gain momentum in recent months. Some members of Congress have called Live Nation a monopoly that limits competition in the touring business and harms consumers by charging high prices and leaving some unable to purchase tickets for in-demand concerts like Swift’s Eras tour. Many inside and outside of Washington have called for the Department of Justice to break up the company’s concert promotion and ticketing operations. On Thursday, Sens. Klobuchar and Mike Lee sent evidence of the Jan. 24 Senate hearing on the ticketing market to the Department of Justice and encouraged its antitrust division “to take action if it finds that Ticketmaster has walled itself off from competitive pressure at the expense of the industry and fans.” Others have suggested Ticketmaster improve its security practices to deal with the bot attacks that derailed Swift’s pre-sale.
Ticketmaster may be most reviled for its fees, though. And as Rapino pointed out, those aren’t going away anytime soon.
Live Nation’s 2022 was record-breaking across basically all key metrics — revenue, concert attendance, gross transaction value and sponsorships were all at all-time highs — and the company expects 2023 to top that.
As the company reported Thursday (Feb) with its fourth quarter earnings, total revenue reached a record $16.7 billion in 2022 — up 44% from the pre-pandemic era of 2019. That growth was spread across a number of factors: more fans, more concerts, more spending per fan, higher average ticket prices and a greater number of large sponsors.
Adjusted operating income improved 49% to $1.4 billion over the year, and operating free cash flow rose nearly four-fold to $1.8 billion.
Concert revenue in 2022 was $13.49 billion, up 43.1% from 2019 and 185.8% more than 2021. Concert attendance reached 121 million fans in 2022, up 24% from 2019 and a 246% increase from 2021, a year Live Nation began to recover from the pandemic but was not yet at full strength. The concerts division put on 43,600 events in 2022, up 153.2% from 2021 and up 8.4% from 2019. Attendance for Venue Nation, the venues operated by Live Nation, reached almost 50 million.
Ticketing revenues of $2.24 billion was up 44.9% from 2019 and up 97.4% from 2021. Fee-bearing ticket volume rose 28% from 2019 to 280 million. Fee-bearing gross transaction value grew to $28 billion, up more than 50% from 2019.
The average ticket costs were higher in 2022, too. With more tickets priced dynamically to true market value, Live Nation estimates $700 million was shifted to artists (and, presumably, away from the secondary market). That said, the average entry price for tickets remained below $35 in the U.S.
Even though consumers felt the pinch of high inflation throughout 2022, music fans didn’t shy away from spending money at Live Nation concerts. Ancillary per-fan spending rose at least 20% across all venue types from 2019 levels.
Sponsorship revenue reached $968 million, up 64% from 2019 and 135% greater than 2021. Live Nation had 120 large sponsors globally, up 32% from 2019. Last year, the company added PayPal, GoPuff, Hulu and Snap as sponsors. They and other new, large sponsors accounted for 80% of sponsorship’s revenue growth in 2022.
Live Nation points to a number of leading indicators that suggest 2023 will be even stronger than 2022. As of mid-February, event-related deferred revenue — tickets sales for concerts that have not yet occurred — was up $400 million to $2.7 billion. Also through mid-February, ticket sales are up 20% and fee-bearing gross transaction value of tickets sold is up 33%.
Just a week after Ticketmaster’s disastrous presale for Taylor Swift‘s The Eras Tour, Sens. Richard Blumenthal (D-CT) and Marsha Blackburn (R-TN) are asking the chair of the Federal Trade Commission (FTC) how the agency plans to combat bots in the online ticketing marketplace.
In a letter sent Monday (Nov. 28), Sens. Blumenthal and Blackburn — chair and ranking member of the Senate’s Subcommittee on Consumer Protection, Product Safety and Data Security, respectively — are requesting information from FTC chair Lina Khan about what steps the FTC is taking to enforce the 2016 law known as the Better Online Ticket Sales (BOTS) Act, which was designed to crack down on the kind of illegal bots that have plagued online ticket sales for recent tours by Swift and other major stars.
That law, which “prohibits the circumvention of a security measure, access control system, or other technological control measure used online by a ticket issuer” and the sale of tickets knowingly obtained through those means, grants the FTC and state attorneys general the authority to enforce violations, according to the letter. But since the BOTS Act became law, Blumenthal and Blackburn claim the FTC has taken only a single enforcement action despite numerous incidents involving the use of bots in online ticket sales.
“Given the numerous high-profile incidents in the online ticket marketplace, it would be helpful to understand how the FTC intends to act to address such conduct going forward,” the letter reads.
Monday’s letter follows Ticketmaster’s earlier claim that the Swift debacle was caused in part by tens of millions of uninvited users and billions of bots crashing the Eras presale, forcing the company to shut down the tour’s final onsale after more than 90% of ticketing inventory was snapped up.
In the wake of the fiasco, politicians including Sen. Amy Klobuchar — chair of the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights — and Rep. Alexandria Ocasio-Cortez suggested Ticketmaster and its owner Live Nation represent a monopoly and cried out for accountability, with the latter directly calling for the companies, which merged in 2010, to be broken up. Last week, Klobuchar and her counterpart on the Senate Judiciary Subcommittee, Sen. Mike Lee (R-UT), jointly announced they would be holding a hearing to examine the effects of consolidation on the ticketing industry. Live Nation and Ticketmaster are also reportedly under investigation by the Justice Department over whether the companies represent an illegal monopoly, though that probe is said to have predated the Swift incident.
In addition to the Swift debacle, in the letter Blumenthal and Blackburn point to various other recent online ticketing mishaps involving bots, including tours for Bob Dylan, Blake Shelton, Bruce Springsteen and Adele.
“While bots may not be the only reason for these problems, which Congress is evaluating, fighting bots is an important step in reducing consumer costs in the online ticketing industry,” the senators continued. They point out that the infiltration of bots, among other factors, creates an unfair environment that prevents regular fans from purchasing tickets, forcing them to resort to secondary sites where tickets are often marked up dramatically. “Some reports have found secondary ticket sales ranging from $1,000 (Bruce Springsteen) to $40,000 (Adele),” the lawmakers added.
Though Swift may benefit from Blackburn’s interest in addressing the ticketing bots issue, the two have not exactly gotten along in the past. The pop star made a rare-at-the-time political statement in 2018, denouncing Blackburn for her conservative voting record and urging voters to choose her opponent in the Senate race that year. She later called the lawmaker “Trump in a wig.” Last year, Blackburn addressed the tiff in an interview, arguing Swift would the “first victim” in a “socialistic government.”
In addition to asking whether the FTC has any “pending enforcement matters before it” with respect to the BOTS Act, Blumenthal and Blackburn are asking why only a single enforcement action has been taken to date; whether there are “obstacles preventing” the FTC from enforcing the law; and whether there are “other solutions that Congress needs to consider” to prevent bots from operating in the future.
You can read the full letter below.
Dear Chair Khan:
We write to ask for information about the steps the Federal Trade Commission (FTC) is taking to combat the use and operation of bots in the online ticket marketplace. As you know, the Better Online Ticket Sales, or BOTS Act, became law in 2016. This law prohibits the circumvention of a security measure, access control system, or other technological control measure used online by a ticket issuer. It also prohibits the selling or offering of an event ticket obtained through a circumvention violation if the seller participated in, had the ability to control, or should have known about the violation. The BOTS Act gives the FTC and state attorneys general the authority to enforce violations as unfair and deceptive practices.
Recently, several high profile incidents arose where consumers encountered serious difficulties purchasing tickets through online ticket vendors, including Ticketmaster and AXS. While bots may not be the only reason for these problems, which Congress is evaluating, fighting bots is an important step in reducing consumer costs in the online ticketing industry. For example, consumers reported trying to purchase tickets to see Bob Dylan at the Ryman Auditorium in Nashville, only to be told the tickets in their shopping cart no longer existed. Similarly, 22,000 fans preregistered to buy tickets for Blake Shelton, but only a few hundred actually got tickets. Finally, Ticketmaster/LiveNation pointed to online bots as a reason why fans could not get Taylor Swift concert tickets, leading the ticket seller to shut down sales to the general public.
While some consumers opt to purchase tickets on the secondary market, most fans cannot afford to pay thousands of dollars for a single concert ticket. Some reports have found secondary ticket sales ranging from $1,000 (Bruce Springsteen) to $40,000 (Adele).3 Preventing this type of consumer harm is exactly why Congress chose to enact the BOTS Act six years ago and why we both chose to sponsor that bill.
We understand that, in January 2021, the FTC took its first enforcement actions under the BOTS Act. However, given the numerous high-profile incidents in the online ticket marketplace, it would be helpful to understand how the FTC intends to act to address such conduct going forward. We request answers to the following, which may be provided in a confidential briefing if needed:
Does the FTC have any pending enforcement matters before it with respect to the BOTS Act?
Why has the FTC only undertaken a single enforcement action to date using its BOTS Act authority?
Are there obstacles preventing the FTC from exercising its authority under the BOTS Act that Congress should be aware of?
Are there other solutions that Congress needs to consider in conjunction with the BOTS Act?
We appreciate your timely attention to this issue.
Sincerely,
Marsha BlackburnRanking MemberSubcommittee on Consumer Protection, Product Safety, and Data Security
Richard BlumenthalChairSubcommittee on Consumer Protection, Product Safety, and Data Security
Some of Taylor Swift’s fans want you to know three things: They’re not still 16, they have careers and resources and, right now, they’re angry. That’s a powerful political motivator, researchers say.
Look what Ticketmaster made them do.
It started Nov. 15, when millions crowded a presale for Swift’s long-awaited Eras Tour, resulting in crashes, prolonged waits and frantic purchases. By Thursday, Ticketmaster had canceled the general sale, citing insufficient remaining tickets and inciting a firestorm of outrage from fans. Swift herself said the ordeal “really pisses me off.”
Ticketmaster apologized but the bad blood had already been sowed. And now fans — and politicians — have started acting on it.
U.S. Rep. Alexandria Ocasio-Cortez directed Swifties to where they could make U.S. Department of Justice complaints. Multiple state attorneys general — including in Pennsylvania and Tennessee, key states in Swift’s origin story — have announced investigations.
Stephanie Aly, a New York-based professional who has worked on community organizing for progressive politics, for years has thought mobilizing fandoms for social progress could be beneficial. “Fandoms are natural organizers,” said the 33-year-old Swiftie. “If you find the right issues and you activate them and engage them then you can effect real change.”
In 2020, for instance, K-pop fans organized to back the Black Lives Matter movement and sought to inflate registration for a Donald Trump rally. Aly and Swifties from different industries — law, public relations, cybersecurity and more — have joined forces to create Vigilante Legal, a group targeting Ticketmaster by creating email templates to petition attorneys general and providing antitrust information. Thousands have expressed interest in helping or learning more.
“The level of anger that you’ve just seen in the country around this issue is astounding,” said Jean Sinzdak, associate director for the Center for American Women and Politics at Rutgers University. “People are really sharing their feelings about that and building a movement about that online, which I really think is quite fascinating. It’s certainly an opportunity to engage people politically. Whether it lasts is hard to say, but it certainly feels like a real opportunity.”
In one way, said Sinzdak, this is giving Swift’s large following of younger people a direct line to seeing how policy takes shape. It’s also targeting a demographic that is seldom courted by politicians during election season.
“Nobody goes out and thinks, ‘Let’s target young women,’” said Gwen Nisbett, a University of North Texas professor who researches the intersection of political engagement and pop culture. “Be it about abortion or student loans, that age group is super mobilized and young women are super mobilized.”
Fan culture and community has boosted that tendency toward mobilization. Nisbett was studying parasocial relationships — when fans have strong one-way relationships with celebrities — in 2018, when the previously apolitical Swift posted an endorsement of Democratic candidates to social media. Nisbett found that while such posts may not determine fans’ votes, they still led to the increased likelihood fans would look for more information about voting — and actually vote.
For the record: AP VoteCast, an extensive survey of the U.S. electorate, showed about a third of Tennessee voters in 2018 said they had a favorable opinion of Swift, and among them, a large majority — about 7 in 10 — backed Democrat Phil Bredesen in the Senate contest. That was in clear contrast to the roughly third of voters who had an unfavorable opinion of Swift and overwhelmingly backed Republican Marsha Blackburn.
For Swifties, the ire for Ticketmaster is not just about a ticket: “It’s the fact that you can’t participate in your community and your fandom and it’s part of your identity,” Nisbett said.
This isn’t even the first time a fandom or an artist has targeted Ticketmaster. Pearl Jam took aim at the company in 1994, although the Justice Department ultimately declined to bring a case. More recently, Bruce Springsteen fans were enraged over high ticket costs because of the platform’s dynamic pricing system.
“It’s not just about getting vengeance for Swifties. It’s not about getting an extra million Taylor Swift fans tickets, or all of us going to a secret session,” said Jordan Burger, 28, who is using his law background to help the cause. “It’s about fundamental equality. And when you have a monopolist like that, it’s just so representative of the class structure of a society where there isn’t equality anymore, there isn’t fairness.”
The sheer power and size of Swift’s fandom has spurred conversations about economic inequality, merely symbolized by Ticketmaster. Aly noted that quite a few of the members of the group did get tickets; the issue is is bigger than Ticketmaster, she said.
“We’ve gotten some feedback that, ‘This is too big, let the government handle it.’ Have you seen the U.S. government? The government only functions when the people push it to and when the people demand that it function and the people are involved,” she said. “Even when something seems too big to fail or too powerful to fail, there are always enough of us to make a difference. Your involvement may be the thing that pushes it over the edge that forces the government to act.”
Aly says many grown-up Swifties have 10-15 years’ experience of being bullied for liking the singer — but what fans have in mind might be better than revenge.
“We have thick skin and nothing to lose, really,” Aly said.
Maybe Live Nation chairman Greg Maffei’s statement that Taylor Swift and promoter AEG “chose” to work with Ticketmaster for her calamitous onsale earlier this week should have come with an asterisk.
On Thursday (Nov. 17), Maffei attempted to correct criticisms about Ticketmaster and its owner Live Nation operating as a monopoly by pointing out that Swift’s 2023 Eras Tour “is not actually a Live Nation promoted concert” but rather “promoted by one of our largest competitors.”
Maffei — who is also the president of Live Nation’s largest shareholder Liberty Media — continued: “AEG who is the promoter for Taylor Swift, chose to use us because, in reality, we are the largest and most effective ticket seller in the world. Even our competitors want to come on our platform.”
The thing is, AEG says it’s essentially forced to work with Ticketmaster because of the stranglehold it has over the touring business. “Ticketmaster’s exclusive deals with the vast majority of venues on the Eras tour required us to ticket through their system,” an AEG spokesperson told Billboard in a statement. “We didn’t have a choice.”
The debacle centers around Swift’s presale Tuesday for her Eras Tour, which initially crashed shortly after launch as 14 million fans and billions of bots flooded the site, causing service disruptions. The ticket crash caught the attention of Capitol Hill. Rep. Alexandria Ocasio-Cortez and Sen. Amy Klobuchar, both of whom criticized the outage at Ticketmaster and doubled down on claims that the Live Nation-owned ticketing service was a monopoly. The Justice Department is now reportedly investigating Live Nation, though the investigation reportedly pre-dated the Swift debacle.
AEG and Live Nation have a complicated relationship built around intense competition and steady cooperation going back decades. While AEG’s facility group relies on Live Nation for programming, AEG Presents, the company’s concert promotion wing, competes directly against Live Nation’s global touring team and has its own preferred ticketing system, AXS.
While AEG Presents prefers to use AXS, their partner in the Eras Tour, Louis Messina (Messina Touring Group is a 50-50 joint venture between AEG and Messina), is basically agnostic when it comes to ticketing systems — he will work with any ticketing company, based on where the show takes place. In North America, that means working with Ticketmaster, which is especially dominant in the NFL as it provides tickets to 27 of the NFL’s 32 teams. By choosing to stage her show in NFL stadiums – really, in choosing to tour stadiums in the U.S. — Swift and her partners at AEG and Messina Touring Group are effectively forced to use Ticketmaster due to its supremacy in North America.
In that sense, Maffei’s argument that AEG chose to work with Ticketmaster is misleading, but it would also be inaccurate to describe Swift or AEG’s relationship with Ticketmaster as one built upon coercion. Historically, it’s been more mutually beneficial.
AEG’s venue management company ASM Global — formed following the merger of AEG Facilities and SMG in 2019 to become the biggest such company in the country — expanded its partnership with Live Nation in 2021, allowing the use of Ticketmaster for any of the shows the promoter brings to ASM’s 300 clients. In this arrangement, both sides win, since AEG relies on Live Nation to bring content to its buildings and grants the company incentives to entice shows to their facilities.
Swift has worked very closely with Ticketmaster over the years — for her Reputation stadium tour, the COVID-19-canceled Lovers Fest and now the Eras Tour, building an entire fan verification and Taylor Swift-branded ticketing platform together. While Swift might have preferred to have had more options to sell tickets to her fans, she did partner with the company in a way that few artists have in the past.
Perhaps Ticketmaster and Swift will mend their relationship once they start counting how much money they made together. Or maybe, they’re never, ever, ever, ever getting back together.
The Ledger is a weekly newsletter about the economics of the music business sent to Billboard Pro subscribers. An abbreviated version of the newsletter is published online.
Is Ticketmaster a monopoly that treats customers unfairly? Problems with Taylor Swift’s record-breaking The Eras Tour onsale this week has created choruses of complaints around the ticketing giant that have now led to a reported Justice Department investigation.
On Thursday, Sen. Amy Klobuchar sent an open letter to Live Nation CEO Michael Rapino detailing her “concerns about the state of competition in the ticketing industry and its harmful impact on consumers.” The problem, wrote Klobuchar, is a lack of competition “that typically push[es] companies to innovate and improve their services. That can result in dramatic service failures, where consumers are the ones that pay the price.”
Breaking up Live Nation and Ticketmaster wouldn’t necessarily have prevented this problem. It’s likely that any ticketing platform would have struggled with such a high level of demand. StubHub crashed in 2018 after University of Georgia fans flooded the site to purchase tickets to see their team play in the NCAA football national championship game — and that was just one game.
Ticketmaster blamed the outage on a surge of unregistered fans and billions of bots. According to the company, over 3.5 million people pre-registered for Swift’s Verified Fan credentials, the largest registration in its history. Typically, only a fraction of registered fans show up to buy a ticket. This time, “a staggering number of bot attacks as well as fans who didn’t have invite codes” resulted in 3.5 billion total system requests — four times the previous record number.
One could argue Ticketmaster could have been better prepared for such a high level of demand. Perhaps the company should Swift-proof the platform in anticipation of a flood of speculators and unregistered fans — Swift said Friday (Nov. 18) that her team “asked them, multiple times, if they could handle this kind of demand and we were assured they could.” Overall, problems on the platform are relatively rare given Ticketmaster’s volume of business, but we talk about them because they happen with high-profile concerts that attract large numbers of customers. Those attract the most attention and complaints online, which in turn attracts politicians. Ticketmaster is one of the few non-partisan issues in America in 2022.
Some observers have conflated the issues surrounding Ticketmaster’s market power, though. Rep. David Cicilline, chairman of the House Judiciary Committee’s Antitrust, Commercial and Administrative Law Subcommittee, wrote about the Swift on-sale that “excessive wait times and fees are completely unacceptable … and are a symptom of a larger problem.” It’s fair for Cicilline to suggest that Ticketmaster does not invest enough in its platform to avoid the technical issues and wait times Swift fans recently experienced. That’s debatable, but it’s a defensible argument.
Fees are, however, an entirely different issue. Ticketmaster is a pioneer in the area of ticket fees but does not have a monopoly on the ability to charge them. More competition in ticketing would not prevent venues and promoters from adding to the face value of tickets. The ticket purchase is an opportunity for all parties involved to capitalize on fans’ demand for live music. As Bruce Springsteen’s controversial leap into dynamic pricing showed, leaving money on the table is an increasingly uncommon strategy in the modern music business.
Ticket prices occasionally get dragged into the argument, too. Politicians and consumers seem to want a form of price competition that doesn’t exist. Prices for an in-demand concert ticket won’t necessarily become more affordable if they’re sold at, say, StubHub rather than Ticketmaster. The laws of supply and demand say that prices for in-demand, scarce objects like a Swift concert ticket are going to be high no matter who’s selling them.
So, what tangible results might come from the calamitous The Eras Tour on-sale? Sen. Klobuchar’s letter points to customers’ desire for fair access to concert tickets. She asked Rapino, “Generally, what percentage of high-profile tour tickets are made available to the general public compared to those allocated to pre-sales, radio stations, VIPs, and other restricted opportunities?”
Klobuchar wants to know what percentage of tickets the average person has a realistic shot at getting without being the customer of a particular credit card, without buying high-priced VIP packages, without winning a radio station contest or without being a member of an artist’s fan club. In this case, Capital One is a sponsor of the Eras tour and offered a pre-sale to its customers.
But how do lawmakers regulate access? Do they establish rules that dictate what kind of marketing partnerships artists can and cannot establish? Would they tell American Express to stop giving such long-standing perks as pre-sale access and dedicated tickets to its credit card holders? If Congress really wanted to create a more level playing field for fans, they could do what the lawmakers in Victoria, Australia, did in 2021: pass a law that limits the resale value of a ticket to 110% of its face value. That could lower the number of resellers and bots clogging up Ticketmaster’s system for high-traffic on-sales like the Eras Tour. At the very least, price limits would bring a much-desired sense of fairness to the secondary market. Whether the U.S. Congress has the stomach to establish price controls on private companies remains to be seen.
A more likely outcome of the Eras Tour debacle is increased transparency. New York State legislators passed a law in June that improves transparency by requiring all-in pricing and prohibits revealing the ticket’s total cost — face value plus fees — after multiple clicks in a check-out process. The bill could have gone further: a requirement to disclose the percentage of tickets made available to pre-sales and VIPs was in an early form of the bill but not the final version.
But, again, are lawmakers willing to mandate such disclosures from private businesses? This would more likely be a voluntary disclosure done at the behest of the artist – Swift is exactly the kind of powerful artist who could persuade ticket sellers to reveal this information. Transparency wouldn’t immediately translate into greater access for the average fan, but it could fuel a larger conversation about how fans get access to concert tickets. That wouldn’t ease the pain of many Swift fans, but it would be a step forward.