A little more than two weeks ago, many concertgoers felt a disturbance in the force.
As announced Feb. 10, two giants of the live music industry, ticket juggernaut Ticketmaster and events promotion company and erstwhile ticket seller Live Nation, will be merging. As with any merger of two large companies, there has been considerable speculation as to how this move will affect the live music industry and the consumer. But is the sky of the ticket market truly falling, or is the general corporate-fearing public pulling a chicken little? As it turns out, the more pertinent question may be who the sky falls on, if it falls at all.
Prior to the merger, Ticketmaster functioned primarily as a ticket sales agent. A given venue can release a certain number of tickets for Ticketmaster to sell to the public, easing the burden of sales for those at the venue. Live Nation, on the other hand, up until now, was more of an events company, famous for its unique and trendsetting deals with musicians such as Madonna, Jay-Z and U2, and the company bought exclusive rights to produce live shows. Live Nation also owned exclusive ticket rights to certain venues, such as the Hollywood Palladium. Although both businesses sell tickets ““ Live Nation to a lesser degree ““ the move is seen more as vertical integration, with the as yet unnamed company controlling live shows’ productions as well as the tickets to said shows.
As expected, the announcement of this decision has been met with suspicion and apprehension from a variety of sources. In fact, Congress itself announced that its Antitrust Committee would look into the merger for unfair business practices. This has mainly been attributed to an incident in which people attempting to buy Bruce Springsteen tickets were referred to another aftermarket Web site after tickets sold out that was owned by Ticketmaster itself.
Concertgoers, too, have expressed some dismay. The term “Ticketmaster” for years has been near synonymous with the term “fees.” The infamous convenience and processing fees, collectively known as surcharges, have become one of the most loathed parts of the concert experience. Needless to say, this is where Ticketmaster turns a profit.
“The actual face value of the ticket is generated by the worth of the artist and capacity of the venue,” said Sean Healy, founder of Sean Healy Presents, a local independent promotions and booking company. “That’s what determines it. The fees on top of it and the additional stuff is where they do make their profit. The merger makes it easier to buy more tickets for more shows online, and that’s great. It’s a question of what is truly a convenience fee.”
Naturally, some consumers fear that the surcharges will increase post-merger as the new company seeks to increase profit.
“It would be nice if (the surcharges) stayed the same, since they control more of the business now,” said Rachel Alonso, a third-year history student. “But I doubt they will, because I don’t see them as very honest companies.”
Healy expressed a similar sentiment.
“I don’t see (the fees) going down, let’s put it that way,” he said. “Unless they can figure out a way, the merger doesn’t do a thing for the consumer.”
On the other hand, this merger has also been seen as just a continuation of the well-worn tradition of concertgoers paying well above the face value of the ticket.
“I really do (think it will maintain the status quo) for the consumer,” Healy said.
He surmises that despite the continuing effects on the consumer, the merger may potentially hit other targets as well.
“The people overall that will suffer the most will be the venues, because they won’t be as full and that kind of trickles down,” Healy said. “The artists might suffer as well and have shows canceled for soft ticket sales.”
Others have posited that this merger goes further toward empowering artists. Music writer Bob Lefsetz argues that this reduces “internal squabbling” in the ticketing business and helps shift power away from labels and toward the talent.
Still, Healy fears that the potential increase in surcharges may inhibit the ability of venues to fill up. Furthermore, he stipulates that it will be the mid-level venues that suffer the most of all, because concertgoers are more likely to attend bigger shows in spite of the surcharges.
“True concertgoers, they know that they’re going to buy a ticket at the door if it’s a mid-level artist that they’re just really into,” Healy said. “If you’re talking about Kanye West or Jay-Z, they’re going to buy them regardless.”
Others have echoed that sentiment.
“There are certain bands that I wouldn’t mind paying a premium for,” said Mike de Carlo, a fourth-year philosophy student.
In other words, arena tours won’t suffer, while midsize venues such as the Henry Fonda, Key Club and Echo might see a dip in sales.
As for promoters, some have spoken out against the merger, saying that it gives Live Nation, essentially a competitor to all promoters, access to the ticket sales lists that were previously shared only by promoters and Ticketmaster. Healy seems more at ease with that fact and with the merger in general.
“I am a Ticketmaster client. I put all of my shows on Ticketmaster, and they’ve been there on Ticketmaster for years. … As an independent promoter, we have a little bit more say, because we are renting the venues,” Healy said. “Certain venues, you have to use their ticketing systems. Most do use Ticketmaster.”
Healy has also been able to keep his independent business healthy by keeping a greater number of tickets to himself to sell at face value through his side project, The Backstage Pass. As an independent promoter, Healy hopes to have less of his tickets completely affected by surcharges, but advertises for the project mainly to previous clients.
Although the mere mention of Ticketmaster may arouse the ire of many young people and students (there are 14 groups that come up for the search terms “I Hate Ticketmaster” on Facebook), it remains to be seen how this marriage of ticket agent and promoter will affect consumers, venues and artists. Both companies have kept relatively mum regarding the details of the merger ““ a representative for Live Nation declined to comment for this story. Although this merger can conjure up images of skyrocketing fees, some believe that consumers won’t be affected as much as they may fear. So while the merger’s nuts and bolts are worked out, the fans, venues and artists await their consequences.