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Ticketmaster
American ticket sales and distribution company

Ticketmaster Entertainment, LLC is an American ticket sales and distribution company headquartered in Beverly Hills, California. In 2010, it merged with Live Nation to form Live Nation Entertainment. Ticketmaster operates fulfillment centers in Charleston, West Virginia and Pharr, Texas for both primary and secondary ticket markets. The platform has faced multiple controversies, including scrutiny from the United States Department of Justice over fees and alleged antitrust violations. Following the 2022 Taylor Swift pre-sale controversy, the DOJ launched a formal investigation and, in May 2024, filed an antitrust lawsuit against Live Nation and Ticketmaster, joined by 40 states.

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History

Ticketmaster was founded in Phoenix, Arizona in 19764 by college staffers Peter Gadwa and Albert Leffler, Gordon Gunn III, as well as businessman Jerry Nelson.56 The company originally licensed computer programs and sold hardware for ticketing systems. Its first ticketed concert was Electric Light Orchestra, held at the University of New Mexico.78

In 1982, Fred Rosen was appointed CEO of Ticketmaster and moved the company to Los Angeles to be closer to the live entertainment industry. The move enabled the company to build contracts with many well-known venues including the LA Forum. Rosen drove investment into the company and led the switch to computerized ticketing.9 By 1985 the company had operations in the U.S., Canada and Europe.10 Under Rosen, the company moved into publishing and set up a travel agency and acquired rival Ticketron in 1991, making it the market leader.1112

In November 1993, Microsoft co-founder Paul Allen acquired an 80% stake for more than $325 million.1314

InterActiveCorp years

In 1998, USA Networks Inc., later named InterActiveCorp (IAC), purchased a majority stake in Ticketmaster.15 That same year, the company merged with CitySearch and was renamed Ticketmaster Online-CitySearch.16 In May 2000, Ticketmaster Online-CitySearch acquired TicketWeb Inc., a ticket vendor that sold tickets online and over the phone.17 In 2003, IAC repurchased the remaining Ticketmaster stock that it had previously sold off.18

In September 2006, Ticketmaster President Sean Moriarty told NPR that Ticketmaster had lobbied several states to enact laws that would limit the ticket resale market to authorized companies. Economists worried these laws would harm competition, but Moriarty expressed the need to reduce corrupt scalpers and counterfeit tickets.19

In January 2008, Ticketmaster acquired Paciolan Inc., a developer of ticketing system applications and hosted ticketing systems, after litigation over the potential breach of antitrust laws.20 Also in January, Ticketmaster acquired the UK-based secondary ticket marketplace, Getmein.com.21 And finally, in that same January, Ticketmaster acquired TicketsNow, a ticket reseller in the United States, for $265 million.22

IAC spun off Ticketmaster as its own company in the summer of 2008.23 Later in 2008, Ticketmaster acquired Front Line Management, an artist management firm that worked with artists such as Aerosmith, Christina Aguilera and Jimmy Buffett.24 Front Line CEO Irving Azoff became CEO of the new company, which was renamed Ticketmaster Entertainment.25

Live Nation merger

In February 2009, Ticketmaster entered into an agreement to merge with event promoter Live Nation to form Live Nation Entertainment.26 The deal was cleared by the U.S. Justice Department in January 2010 under the condition that the company sell Paciolan to Comcast Spectacor or another firm, and license its software to Anschutz Entertainment Group (AEG), its biggest competitor.27 The new company, which would be called Live Nation Entertainment, would also be subject to provisions for 10 years that prevented it from retaliating against venues that partnered with competing ticketing firms.28 When the DOJ planned to bring court proceedings against the company in 2020 for six violations to these provisions, Live Nation agreed to a settlement that extended them an additional fine years to 2025.29 Live Nation CEO Michael Rapino was named CEO of the new company.30

One year after merging, Live Nation settled a previous class action lawsuit against Ticketmaster which alleged that the company had misled plaintiffs in its descriptions of delivery and processing fees.31

Growth and acquisitions

In 2015, Ticketmaster acquired Front Gate Tickets, a music festival ticketing service that provided services for festivals including Lollapalooza and Austin City Limits.32 The same year, the company acquired Universe, a DIY ticketing platform,33 and Two Toasters, a mobile app developer.34 In 2017, TicketWeb, Ticketmaster's self-service ticketing platform, acquired Strobe Labs, a marketing platform that allows users to market to fans through social media.35 In 2018, Ticketmaster acquired UPGRADED, a company which converts physical tickets into digital ones, utilising blockchain.36 In 2020, Ticketmaster acquired Taiwan's Tixcraft (拓元售票) for entering the Asian market.37

Products and services

Ticketmaster sells tickets that its clients make available to it.38 In 2009, Ticketmaster released a digital ticketing system that required customers to prove their identity prior to purchase. The company believed this would help circumvent brokers and scalpers.39

In 2016, Ticketmaster released a statement in favor of the Better Online Ticket Sales Act (BOTS Act), which banned the use of ticket bots to buy large amounts of tickets online and resell them at inflated prices.40 The following year, the company filed a lawsuit against the ticket broker Prestige Entertainment after the company used bots to buy more than 30,000 tickets to the Broadway play "Hamilton".41

The company reported nearly 500 million tickets sold for 400,000 events in 2018.42

In November 2020, Ticketmaster announced it will check the COVID-19 vaccination status of ticket buyers before issuing passes when live events return in 2021. Fans that either failed to verify their vaccination status or tested positive would be denied access to the event.43

Pricing

The face value of Ticketmaster tickets is determined by the artist or client.44 In addition to the face value price, venues and Ticketmaster add fees to pay for their services.45

Typically, fees added to a ticket's face value have included:464748

  • Facility charge – Charge added by the venue.
  • Delivery fee – Charges added dependent on the ticket delivery method and credit card processing fees.
  • Service fee – Sum of charges added based on the "agreement with each client (artists)" and the order processing fee. Ticketmaster "may earn a profit on the order processing fee".49

As the Los Angeles Times has explained, "the 'service fee' is intentionally kept separate from the list price for two reasons: to make the base price of a ticket appear more affordable, and to create the impression that only Ticketmaster pockets that fee."50 In other words, "Ticketmaster is effectively paid to be a punching bag" for consumer frustration with opaque add-on fees, and then some of the fees find their way back to the artist or venue.51 Utilizing such subterfuge to extract additional revenue from fans without arousing direct backlash towards themselves has become increasingly important for artists. The collapse of record album sales after the year 2000 means that as of the 2020s, 95 percent of artist income comes from concert tours.52

Fee amounts vary between events and are dependent on the venue, available delivery methods, and preferences of the artist.53 Some economists and activist groups have claimed that high ticket prices are due to a lack of competition within the music industry.5455

In 2013, the jam band The String Cheese Incident gave fans money to purchase 400 tickets to one of its shows in order to resell them on its own site with fewer fees. The band said they were protesting Ticketmaster's ticket fees, while Ticketmaster argued that the band was taking revenue from venues and promoters.5657

As of 2016, ticket resale was Ticketmaster's fastest growing business.58

In 2022, Ticketmaster was experimenting with a demand-based, dynamic pricing which would vary the ticket price based upon demand. The new system is touted to give artists a higher share of the revenues that would otherwise be coming through resale ticket sales.59

Criticism and controversies

Anti-competition claims

In May 1994, the grunge band Pearl Jam filed a complaint with the U.S. Department of Justice claiming Ticketmaster had cut the group out of venue bookings in a dispute over fees.60 The investigation was closed without action in 1995, though the Justice Department stated it would continue to monitor the developments in the ticket industry.6162 Chuck Philips, a reporter who covered the issue,63646566 was told by sources close to the case that the investigation was closed due to a combination of a shortage of resources and the case being difficult and having uncertain prospects.67

In a 2009 article by the CBC, Ticketmaster argued that legislation was needed in Ontario to protect fans from scalpers and unauthorized ticket brokers saying, "You and I both know there is a thriving ticket-broker industry ... so the law is really a fiction ... We very strongly feel the law needs to be modernized to reflect the reality of internet commerce. By keeping a price cap in place, you're really just driving the [resale] business into the shadows."68 That same year, musician Bruce Springsteen complained of a conflict of interest between Ticketmaster and TicketsNow after fans were directed to TicketsNow once tickets to his concert sold out on Ticketmaster.com. Irving Azoff, Ticketmaster CEO at the time, released an apology and stated that the TicketsNow link would no longer be shown for Springsteen's concerts.6970 In 2018, the United States Department of Justice began reviewing complaints by AEG that claimed the company had engaged in anti-competitive practices. As of April 2018, the Department of Justice had not released comments on its investigation.71

In 2020, the Department of Justice fined Ticketmaster $3 million for violating a consent decree resulting from the Live Nation merger. The consent decree is extended through 2025 and is required to enforce its own compliance with the decree with a penalty of $1 million for any future violations.72

On May 23, 2024, the DOJ and a coalition of 29 states formally launched an antitrust suit against Live Nation and Ticketmaster.73 The lawsuit contends that Live Nation, which owns Ticketmaster, abused its unrivaled power in the concert and ticketing industry to eliminate competition, lessening consumer choice and resulting in rising prices.74

Rewards program monthly fees

In May 2013, Ticketmaster agreed to pay up to $23 million for enrolling customers into a rewards program that charged $9 per month. Ticketmaster made $85 million in fees, from customers who took about eight months on average to cancel their enrollment in the program. 1.12 million customers were eligible to claim up to a $30 refund.75

Secret partnership with scalpers

Ticketmaster has secretly partnered with scalpers to drive up prices for consumers.767778 Economists characterize the secondary market in tickets as socially wasteful rent-seeking.7980 In the mid-2000s, Ticketmaster engaged in primary market auctions that reduced the rents involved in secondary market scalping – however, Ticketmaster ended these primary market auctions, opting instead to enter into the secondary market.81

In September 2018, the Toronto Star reported that Ticketmaster was not enforcing ticket limit rules on its resale platform, TradeDesk.82 Ticketmaster denied the allegations, saying it would examine its resale policies on TradeDesk, and that it "never allows ticket scalpers to buy tickets ahead of fans."83 One month later, a group of customers filed a class action lawsuit against Ticketmaster.84

In July 2019, a report by Billboard revealed a strategy by Live Nation, Ticketmaster's parent company, to secretly bypass placing certain tickets for sale on the primary market and instead, place them directly on resale sites "without giving fans a chance to buy them through normal channels at face value."85 The company acknowledged it has "facilitated the quiet transfer of concert tickets directly into the hands of resellers through the years, though only at the request of the artists involved."

Data breaches

In June 2018, Ticketmaster notified 40,000 U.K. customers that it had identified a hack caused by malicious software on a third-party customer support product it contracted. The company stated that customers who bought tickets between February and June 2018 may have had data compromised.86878889

Between April 2 and May 18, 2024, an "unauthorized third party obtained information from a cloud database hosted by a third-party data services provider" that exposed personal information including payment-card details. Ticketmaster identified customers whose data may have been affected by the breach on May 23, 2024, but only notified them of this a month later in a June 22 letter.90

On May 20, 2024, Ticketmaster’s suffered a breach from their database hosted by Snowflake Inc. as part of a mass Snowflake customer data breach. Ticketmaster's parent company, Live Nation, revealed the breach on May 31, with Australian authorities confirming they were working with the company on the incident.91 Further investigation revealed that the hackers were able to access Ticketmaster's Snowflake database by using credentials stolen from EPAM, a 3rd party business process outsourcing firm.92

As part of the stolen data, hackers leaked customer information and event barcodes for more than 70,000 Ticketmaster events, including Taylor Swift 'Eras Tour' and hundreds of other events. 9394

Deceptive pricing

A class action lawsuit was filed against Ticketmaster in 2003, alleging that it did not fully disclose UPS and order processing fees added to tickets sold online. The case settlement was approved in 2015 and Ticketmaster issued vouchers and discount codes to fans who purchased tickets online between 1999 and 2013.9596 In a related case, Ticketmaster filed suit against its liability insurance carrier, Illinois Union Insurance Company, a subsidiary of ACE Limited, in 2010 for failing to aid in its defense in the 2003 suit.97

In June 2019, Canada's Competition Bureau fined Ticketmaster $4.5 million dollars ($3.44 million US dollars) as part of a settlement after it was discovered that Ticketmaster "topped advertised costs by more than 20% -- and sometimes as much as 65%." In addition to the required payment, Ticketmaster signed a consent agreement to ensure its advertising policies abide by Canadian law.98

Competitor computer hacking

In December 2020, Ticketmaster "entered into a plea agreement with federal prosecutors" and agreed to pay a $10 million fine after being charged with illegally accessing computer systems of a competitor.99 According to FBI Assistant Director-in-Charge Williams Sweeney, "Ticketmaster used stolen information to gain an advantage over its competition, and then promoted the employees who broke the law."100 The allegations were first reported in 2017 when a former CrowdSurge top executive hired by Ticketmaster hacked into his former employer's database.101

Dynamic pricing and "platinum" tickets

Ticketmaster and Live Nation has faced backlash for their dynamic pricing system and "platinum" tickets when tickets for Bruce Springsteen's and Blink-182's 2023 tours went on sale in July and October 2022 respectively, which saw fans of both acts criticize prices for random seats across the venue going for hundreds or thousands of dollars during pre-sales or right when tickets went on sale for the general public.102103 In March 2023, Robert Smith criticized the model and announced that the Cure would not be allowing Ticketmaster to sell dynamically-priced or platinum tickets for the band's upcoming North American tour.104 Smith priced tickets for the Cure's concerts for as low as $20, but Ticketmaster charged fees that equalled more than the price of the base ticket. After Smith expressed his outrage, Ticketmaster refunded a portion of the fees to the purchasers.105

Taylor Swift tour pre-sale crash

Further information: Taylor Swift–Ticketmaster controversy

On November 15, 2022, the first day of pre-sale of tickets to verified fans for the US leg of the Eras Tour (2023) by American singer-songwriter Taylor Swift,106 Ticketmaster's official website crashed following "historically unprecedented demand with millions showing up", halting the pre-sale.107 In less than an hour of availability, the ticketing platform's servers were "unable to answer", with users "either completely logged out or in a queue 2,000-plus people strong that appeared frozen." Ticketmaster immediately published a statement saying they are working to fix the issues "as the site was unprepared to accommodate the sheer force of hundreds of thousands of Swift fans",108 and subsequently reported that "hundreds of thousands of tickets" had already been sold and rescheduled the remaining onsales to a different time, including the Capital One onsale to November 16.109

Fans and customers online widely criticized Ticketmaster for a flawed ticketing model that obstructed them from purchasing tickets. The word "Ticketmaster" was trending number one worldwide on various social media platforms such as Twitter and TikTok.110 Several US lawmakers took notice of the issue. US congresswoman Alexandria Ocasio-Cortez tweeted that Ticketmaster is a monopoly and that it must be unmerged from Live Nation Entertainment. Congressman Bill Pascrell, who had previously petitioned US Attorney General Merrick Garland in support of "strong antitrust enforcement by the Biden Administration" and criticized the merger of Ticketmaster and Live Nation, stated that he attempted to purchase tickets but was placed on the waitlist.111 The Tennessee Attorney General, Jonathan Skrmetti, began an investigation into "consumer complaints about chaos during the presale of tickets" to the tour. He said in a press conference on November 16 that "a lack of competition [for Ticketmaster] has led to a poor experience and higher prices for consumers."112 Following investigations initiated by the Tennessee Attorney General113 and the North Carolina Attorney General on the grounds of consumer rights violations,114 the federal Department of Justice began an investigation into Live Nation Entertainment and Ticketmaster on November 18.115

Swift released a statement on November 18, 2022, via her Instagram story; she asserted that she is protective of her fans and wanted to assure a quality experience for them, but found it difficult to "trust an outside entity with these relationships and loyalties". She said that she was "not going to make excuses for anyone because we asked [Ticketmaster], multiple times, if they could handle this kind of demand and we were assured they could." She concluded that she is taking the necessary measures to resolve the issue and resume the sale.116

In December, a group of Swift's fans, called "Swifties," filed a lawsuit against Ticketmaster and its parent company Live Nation, accusing them of fraud, anti-trust violations, and price-fixing. In the lawsuit, fans demanded $2,500 for each violation, which could potentially amount to several million in total.117

Cloned and invalid Bad Bunny concert tickets

On December 9, 2022, the day of Bad Bunny's first concert of his World's Hottest Tour in Mexico City, an unprecedented number of tickets were cancelled, affecting a considerable group of concertgoers, whose tickets were confiscated and destroyed.118 Because of this, Ticketmaster received a great amount of criticism because many of the attendees who were denied entry were accused of having counterfeit or cloned tickets, even though those attendees presented proof of payment or their ticket had not even been previously scanned. The procurator of Office of the Federal Prosecutor for the Consumer, described on Twitter that the agency had already requested a report from Ticketmaster Mexico on what happened at the Estadio Azteca and asked affected consumers to formalize their complaints under the terms of the law.119 Due to the criticism, Ticketmaster Mexico released a statement through their social networks apologizing and saying that "the inconveniences in the accesses were a consequence of the presentation of an unprecedented number of fake tickets, which caused an out of the ordinary agglomeration of people and an intermittent operation of our system". They also offered refunds for the full cost of the tickets.120 However, PROFECO ordered that those affected not only be refunded the full cost of the ticket, but an additional 20%.121

United States Senate committee hearing

On January 24, 2023, a three-hour hearing by the Senate judiciary committee,122 titled "That's the Ticket: Promoting Competition and Protecting Consumers in Live Entertainment", to analyze "the long-simmering dissatisfaction over the 2010 consent decree governing the merger of Ticketmaster and Live Nation", was held at 10:00 am EST in the Hart Senate Office Building, Washington, D.C.123 The hearing was telecast live. Various media outlets reported that both the Democrat and Republican senators "grilled" Ticketmaster's representative, Joe Berchtold, the company's chief financial officer. The senators questioned Berchtold over Ticketmaster's monopolistic practices, policies, ticket costs, lack of transparency, lack of defense against bots, and insensitivity to music artists. Berchtold, despite apologizing for the debacle, denied accusations of monopoly and fraud, but accepted that "there are several things we could have done better—including staggering the sales over a longer period of time and doing a better job setting fan expectations for getting tickets" and continued to blame "industrial-scale ticket scalping" and "unprecedented number of bots" in Swift's tour debacle. The witnesses prosecuting Ticketmaster included Jerry Mickelson, the president of JAM Creative Productions; and Jack Groetzinger, co-founder of SeatGeek.124125 Live Nation cited several letters of support within its testimony, including one from American country singer Garth Brooks.126 Free Britney America, a D.C. organization that was part of the Free Britney movement, protested outside the U.S. Capitol during the hearing "in support of ending Ticketmaster-Live Nation's monopoly over the live event and ticketing industry."127

Zach Bryan scalpers and Drake tour misinformation

On December 26, 2022, American country singer Zach Bryan criticized Ticketmaster for his Burn Burn Burn tour (2023) and listed out non-transferrable tickets to stop scalpers.128 He went on to release a live album, entitled All My Homies Hate Ticketmaster.129130

In March 2023, fans of Canadian rapper Drake also filed a class action lawsuit against Ticketmaster in the Superior Court of Quebec, alleging intentional deception and fraud. Plaintiffs claimed that the on-sale for the It's All a Blur Tour, a co-headlining concert tour by Drake and 21 Savage, "intentionally misleads consumers for [Ticketmaster's] own financial gain" by concealing information about additional show dates to drive demand and ticket prices.131132 The suit seeks $300 in punitive damages per customer and compensatory damages covering the difference between the "Official Platinum" ticket prices and the regular cost for the seats.133

Eurovision 2023 on-sale crash

For the Eurovision Song Contest 2023 in Liverpool in May 2023, the European Broadcasting Union (EBU) and the host broadcaster BBC partnered with Ticketmaster.134 Prior to the ticket booking platform going live, many users complained that the Ticketmaster website had crashed with a 500 error.135 Tickets for the contest's final sold out in 36 minutes, with the remaining available shows selling out around an hour later.136 Following this, tickets were available on third-party resale platforms such as Viagogo, with a general admission standing ticket for the final, originally priced at £380, being sold for up to £11,800.137138139

Coronation concert ballot misinformation

Ticketmaster was heavily criticised for their handling of the tickets for Coronation Concert of Charles III and Camilla. After two rounds of ticket balloting for guaranteed tickets, remaining unclaimed tickets were released on a first-come, first-served basis to those who had previously applied to the ballot. Despite tickets being fully claimed, thousands of emails were sent to those unsuccessful in the ballot incorrectly informing them that they won tickets.140141 As a result, many people rushed to book travel, accommodation and time off work for the event.142 Ticketmaster was criticised and the email was labeled "misleading".143

Oasis dynamic pricing scrutiny

On 31 August 2024, Oasis announced a live reunion tour for 2025. However, many fans criticised the sales process and prices. Many fans sat for hours trying to get tickets, only to be faced with sitting in queues, or worse, the website would crash, losing fans their place. Other fans reported sitting in a queue for a queue. If fans were able to get tickets, the tickets would change from £135 to more than £350.144 It has been confirmed that these prices, and the demand-induced increase in pricing, would have been set and approved by the band themselves, by Jonathan Brown, chief executive of the Society of Ticket Agents and Retailers145 The band said in a statement, however, that they "leave decisions on ticketing and pricing entirely to their promoters and management" and that they had "at no time had any awareness that dynamic pricing was going to be used".146 The dynamic pricing system used by Ticketmaster is something artists could choose to opt into, with artists such as Robert Smith of The Cure highlighting this in 2023.147

On 5 September 2024 the UK Competition and Markets Authority (CMA) announced it was launching an investigation into Ticketmaster over Oasis concert ticket sales. The CMA said its investigation would include how so-called dynamic pricing may have been used and would scrutinise whether the sale of the tickets may have breached consumer protection law. The investigation would consider whether the firm had engaged in unfair commercial practices, if people were given clear and timely information to explain that the tickets could be subject to dynamic pricing, and if consumers were put under pressure to buy tickets within a short period of time – at a higher price than they understood they would have to pay.148

Ticket transfer hacking

In fall 2024, Ticketmaster customers began noticing tickets were being incorrectly removed from accounts. Despite thousands of customers taking to Ticketmaster's social media accounts over a period of months, the platform initially ignored the comments and released a statement in October 2024 indicating that affected customers were "victims of hackers" taking advantage of the platform's ticket transfer feature.149 Despite this, Ticketmaster did not replace missing tickets or pull its ticket transfer feature pending an investigation into the hacking. This issue continued in November 2024 for fans attending an Usher concert, with the tickets only being refunded after fans complained to the Better Business Bureau. Due to Ticketmaster's lack of information and action, social media users and fans questioned if the organization was in on the scam itself.150

Partners

Ticketmaster has partnerships with venues, professional sports leagues and teams, college and universities, musical acts and theatre tours151152153 and target corporation in the United States and internationally.154 Ticketmaster has partnered with musical acts such as Taylor Swift,155 and the Trans-Siberian Orchestra,156 and theatre productions such as Hamilton and Harry Potter and the Cursed Child.157158

Ticketmaster has been the ticketing provider for the National Football League (NFL), National Hockey League (NHL) and the National Basketball Association (NBA).159160161 In 2008, Ticketmaster entered into an agreement with the National Football League (NFL) to manage its resale market on NFL TicketExchange.162 Ticketmaster also works with wrestling promotions World Wrestling Entertainment (WWE) (1994) and All Elite Wrestling (AEW) (2019)

In 2017, Ticketmaster announced it would open the TicketExchange platform to allow the sale and validation of tickets on third-party websites, including StubHub.163 Ticketmaster has also partnered with the United States Tennis Association,164 Tennis Canada,165 and the PGA Tour.166

See also

References

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  2. Michaels, Dave; Steele, Anne (May 23, 2024). "Justice Department Sues to Break Up Live Nation-Ticketmaster". The Wall Street Journal. Retrieved May 24, 2024. https://www.wsj.com/business/media/ticketmaster-live-nation-sued-justice-department-monopoly-d9442a75 ↩

  3. "Ten Additional States Join Justice Department's Suit Against Live Nation-Ticketmaster for Monopolizing Markets Across the Live Concert Industry". United States Department of Justice. August 19, 2024. Retrieved August 19, 2024. The department, and its now-expanded group of 40 co-plaintiffs, filed an amended complaint in the Southern District of New York. https://www.justice.gov/opa/pr/ten-additional-states-join-justice-departments-suit-against-live-nation-ticketmaster ↩

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