So, my problems with this article, as someone that works in the industry:
1. It's not a secret. It's Ticketmaster's secondary market division, TM+. They may not advertise where people out of the industry would see it, but that's nothing special. They may not want to draw attention to themselves, for reasons such as this article, where they are portrayed very unflatteringly and given little chance to provide their own context. Tradedesk, their new POS offering, is new, and has been somewhat buggy (most might be worked out now), so they've targeted known brokers, but it's a free tool, so they would probably be happy to have anyone that buys and sells more than 1-2 sets of tickets a month (there are a LOT of people that do this as a little extra income, or to pay for their concert habit).
2. Ticketmaster has multiple divisions. The division responsible for proving primary market tickets and the division for running Ticketmaster's secondary market are sometimes at cross purposes. I can tell you from experience though, Ticketmaster does a LOT to prevent the more egregious use of bots, to the point where it can bleed over to regular fans. Every few months there's some new site feature that makes bots harder to utilize. Recently it's a new queuing system and new purchase mechanism, where you select seats off the map (which they've had for a long time, but not during sales).
3. Distinguishing a broker account with 100 purchases on it and a corporate account for bonus gifts or a concierge service may not be as easy as it sounds. It's also not that hard for a broker to just use an account for a few purchases. If I was running a concierge service and Ticketmaster cancelled hundreds of purchases all of a sudden, I would be a bit peeved that they took my money (credit, most likely) for months and then basically killed my business because they incorrectly identified me as a broker account. Also, artists/venues/promoters may not actually want to you cancel tickets and put them back on the market. Being sold out has it's own benefits (and nobody wants to return cash they've already gotten).
4. One of Ticketmaster's main purposes is to offload anger about pricing from artists, promoters and venues to a separate entity. There's a reason why there are often over 50% additional fees per ticket (and they are higher for higher costing seats, how interesting...). It's because many of those are set and received by the artist, promoter and venue. It allows for pricier tickets which is hidden up-front, and the blame goes to Ticketmaster. Ticketmaster of course tacks on their own fees for this service.
5. I believe the secondary market provides a useful function (otherwise I would seek other employment). It helps artists, promoters and venues offload risk (up-front usable money now, instead of little by little as the tour goes on), it helps spread tickets to those that have more money than time (people that devote time still often get tickets, brokers very rarely get everything), and it allows fans to get tickets well below original cost in some (fairly common) cases, such as when a tour is overbought or demand lessens as it goes on. I could find any number of events with secondary market tickets under primary market cost at any moment.
In the end, it's a market. There are tried and true ways to alter it if that's what you want, but for the most part, I think most people are happy with how it works, and happy being able to complain about the time is doesn't as well. Fix and/or make an example of the market participants that are too greedy (such as the broker that got in trouble for buying ALL the Hamilton tickets), and it mostly functions in a way that people expect and find useful. I'll tell you this, getting rid of brokers (if you could) wouldn't result in much cheaper tickets. A lot of the money left on the table would just shift to other market participants, and I doubt it would be the fans.
This argument is repeated over and over again, but i just cant imagine that being right. This is not usually how efficient markets operate, taking into account all the subjective brand appreciation. I can believe that Ticketmaster can shame any artist outside ticket master, or some other network effect, but not that hating ticketmaster, and deteriorating the user experience, is the economically efficient way to do it.
> This is not usually how efficient markets operate
Efficient markets assume clear information that is known by all parties, which make rational decisions. We're talking about a luxury entertainment purchase based on subjective taste in music, and how people feel about those performing that music.
> I can believe that Ticketmaster can shame any artist outside ticket master, or some other network effect, but not that hating ticketmaster, and deteriorating the user experience, is the economically efficient way to do it.
Either you didn't understand what I was saying, or I'm not understanding what you're saying. It's not about Ticketmaster shaming artists, it's about artists not wanting the negative attention and feeling that high ticket prices attract, and offloading some of the price to a third party (by having them collect additional fees) to manage this.
> it's about artists not wanting the negative attention and feeling that high ticket prices attract, and offloading some of the price to a third party (by having them collect additional fees) to manage this.
I'll try to rephrase. This would only work if the artist selling the ticket by themselves could only sell it lower than Ticketmaster. That is, Ticketmaster can extract MORE money out its customers because they hate Ticketmaster.
That is the idea I contest: people pay more on satisfaction, not on dissatisfaction. Yes, the artist save themselves some hassle, but they dont reduce it, they increase it. I would believe Ticketmaster has some leverage we are not considering.
A thought experiment: lets say artists now sell their tickets on platform independent and simultaneous to Ticketmaster, at the same total price. Would people buy on Ticketmaster because they prefer to hate it than to hate the artist?
> That is, Ticketmaster can extract MORE money out its customers because they hate Ticketmaster.
This is what's happening. People want to see the artist they like, so they see Ticketmaster as a necessary evil. If those feeling were transferred to the artist, the artist may alienate fans, which not only affects that specific concert, but future reputation and events as well. This should not be looked at one event at a time in isolation, reputation persists, and pays of in a myriad of ways (album sales, word-of-mouth, etc), so it makes sense to look at it over time, If an artist is able to cultivate a reputation for caring about fans, it helps to have a partner able to take any blowback for actions fans do not like.
More established artists often just charge a lot for tickets. They can get away with it. Having to pay $100+ for the cheapest Rolling Stones tickets isn't going to phase most Rolling Stones fans at this point (and a lot are at a stage in life where they can support it, and much more expensive tickets). The same might not be true of a newer artist, which is still trying to grow their fan base.
> people pay more on satisfaction, not on dissatisfaction.
Generally, yes, but it's also skewed by how often the item in question is purchases, have they purchased it before, etc. No matter how much I enjoy a new car, I still hem and haw at the price when I an seriously considering buying one. Expensive luxury purchases are like that (at this point I do pay for satisfaction in cars - to a degree - but it wasn't always that way, by necessity and by my current state of knowledge).
> lets say artists now sell their tickets on platform independent and simultaneous to Ticketmaster, at the same total price. Would people buy on Ticketmaster because they prefer to hate it than to hate the artist?
Is the artist advertising a similar face value and adding fees on to create a higher purchase price, like Ticketmaster? If not, then I expect the vast majority would probably end up at Ticketmaster because of a lower advertised price, even if it's the same at checkout.
In the end though, some fans may be upset at the pricing and treatment, and that may prevent a future album or concert ticket purchase. Fans are fickle, and there's a relationship between artists and fans, and that's essentially why it's not a rational market. There's emotion in there.
> Is the artist advertising a similar face value and adding fees on to create a higher purchase price, like Ticketmaster? If not, then I expect the vast majority would probably end up at Ticketmaster because of a lower advertised price, even if it's the same at checkout.
Lets try to ceteris paribus it. I have no doubt the price shennanings Ticketmaster does have an extractive effect, but given the same price for TM and the artist, who would choose TM? And if the artist is cheaper because there is no middleman?
Of course TM would punish any artist doing that, thats why I say they must have leverage.
In the end I might be wrong about this, but deception is a poor substitute for economic efficiency. The day one artist collects more money with no fuss, the house of cards falls down.
I could be, but then again, I think that audience then doesn't really understand what's going on, and how it's not as clear cut as they think. For one example of that, see this[1].
1. It's not a secret. It's Ticketmaster's secondary market division, TM+. They may not advertise where people out of the industry would see it, but that's nothing special. They may not want to draw attention to themselves, for reasons such as this article, where they are portrayed very unflatteringly and given little chance to provide their own context. Tradedesk, their new POS offering, is new, and has been somewhat buggy (most might be worked out now), so they've targeted known brokers, but it's a free tool, so they would probably be happy to have anyone that buys and sells more than 1-2 sets of tickets a month (there are a LOT of people that do this as a little extra income, or to pay for their concert habit).
2. Ticketmaster has multiple divisions. The division responsible for proving primary market tickets and the division for running Ticketmaster's secondary market are sometimes at cross purposes. I can tell you from experience though, Ticketmaster does a LOT to prevent the more egregious use of bots, to the point where it can bleed over to regular fans. Every few months there's some new site feature that makes bots harder to utilize. Recently it's a new queuing system and new purchase mechanism, where you select seats off the map (which they've had for a long time, but not during sales).
3. Distinguishing a broker account with 100 purchases on it and a corporate account for bonus gifts or a concierge service may not be as easy as it sounds. It's also not that hard for a broker to just use an account for a few purchases. If I was running a concierge service and Ticketmaster cancelled hundreds of purchases all of a sudden, I would be a bit peeved that they took my money (credit, most likely) for months and then basically killed my business because they incorrectly identified me as a broker account. Also, artists/venues/promoters may not actually want to you cancel tickets and put them back on the market. Being sold out has it's own benefits (and nobody wants to return cash they've already gotten).
4. One of Ticketmaster's main purposes is to offload anger about pricing from artists, promoters and venues to a separate entity. There's a reason why there are often over 50% additional fees per ticket (and they are higher for higher costing seats, how interesting...). It's because many of those are set and received by the artist, promoter and venue. It allows for pricier tickets which is hidden up-front, and the blame goes to Ticketmaster. Ticketmaster of course tacks on their own fees for this service.
5. I believe the secondary market provides a useful function (otherwise I would seek other employment). It helps artists, promoters and venues offload risk (up-front usable money now, instead of little by little as the tour goes on), it helps spread tickets to those that have more money than time (people that devote time still often get tickets, brokers very rarely get everything), and it allows fans to get tickets well below original cost in some (fairly common) cases, such as when a tour is overbought or demand lessens as it goes on. I could find any number of events with secondary market tickets under primary market cost at any moment.
In the end, it's a market. There are tried and true ways to alter it if that's what you want, but for the most part, I think most people are happy with how it works, and happy being able to complain about the time is doesn't as well. Fix and/or make an example of the market participants that are too greedy (such as the broker that got in trouble for buying ALL the Hamilton tickets), and it mostly functions in a way that people expect and find useful. I'll tell you this, getting rid of brokers (if you could) wouldn't result in much cheaper tickets. A lot of the money left on the table would just shift to other market participants, and I doubt it would be the fans.