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Ticketmaster Joins Scalpers

If you can’t beat them, join them. That’s the angle that Live Nation and Ticketmaster are taking in regards to scalpers, as the companies are making another attempt at the aftermarket ticketing business. According to

“Live Nation and Ticketmaster for years have been seeking ways to boost their participation in the $4 billion-a-year business of reselling concert tickets, currently dominated by scalpers and brokers who buy tickets at face value and attempt to flip them for a profit via websites like eBay Inc. and Concert promoters, ticketing companies and even artists have expressed frustration that they don’t see any financial benefit as those speculators charge many times face value for the best seats to hot shows. Of course, scalpers also can mitigate risk for those presenting concerts: If demand for a show doesn’t meet expectations, the scalpers can end up holding unsold tickets or unloading them for below face.”

“Finding a palatable way to participate in the aftermarket has proven elusive for Ticketmaster and Live Nation, which merged in 2010. Ticketmaster failed in its attempt to create a StubHub rival, TicketExchange, and it bought another resale site, TicketsNow, which also struggled. At one point Ticketmaster even considered forming a joint venture with several of the nation’s biggest ticket resellers. That experiment fell apart after a limited test run.”

The new project will merge tickets for resale alongside face value tickets, but will sell clearly marked tickets—alerting customers that they are not purchasing regularly priced tickets.

This is an interesting experiment for Live Nation and Ticketmaster. The main reason for them to get into the business is the $4 billion left on the table after market tickets, and surely they want a piece of that. But my concern is that it doesn’t benefit the customer. Ticket prices have skyrocketed over the last couple of years. What Ticketmaster really needs to do is prevent people from using software to instantaneously buy large quantities of tickets before the average person, to whom they turn around and sell tickets at higher prices.

Ticketmaster has tried this experiment before, and failed. And this time around may not be that different as customers and scalpers already have strong brand loyalty to sites like


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