Ticketmaster is a major ticket sales and distribution company that sells tickets for various live entertainment events. They have exclusive contracts with many major venues and stadiums to sell tickets to events held at those venues. This gives them significant control over ticket sales for concerts, sports games, and other live events. Many people wonder about the details of these venue contracts and what level of exclusivity Ticketmaster has.
Overview of Ticketmaster
Ticketmaster is the largest primary ticket outlet in the United States. The company merged with Live Nation in 2010 to become Live Nation Entertainment, which is a global entertainment company that specializes in ticket sales, promotion of live events, operation of venues, and artist management.
Some key facts about Ticketmaster:
- Founded in 1976
- Headquartered in Beverly Hills, California
- A subsidiary of Live Nation Entertainment since the 2010 merger
- Serves over 30,000 clients worldwide
- Sells tickets for over 500,000 events each year
- Operates in over 40 countries
Ticketmaster sells tickets through their website, mobile apps, ticket outlets, and phone centers. They have a dominant position in the primary ticket sales market.
Ticketmaster’s Venue Contracts
Ticketmaster frequently signs exclusive contracts with major venues and stadiums to sell tickets to all events held at that location. This means that for any concert, sporting event, or other performance at that stadium or venue, the tickets must be sold through Ticketmaster.
These exclusive ticketing agreements typically last for 3-5 years. According to reports, Ticketmaster may pay millions of dollars to secure these exclusive venue deals. Having the exclusive rights at major venues allows Ticketmaster to control ticket distribution for the most popular live events.
Some major venues that reportedly have had exclusive ticketing agreements with Ticketmaster include:
- Madison Square Garden (New York)
- Staples Center (Los Angeles)
- United Center (Chicago)
- TD Garden (Boston)
- AmericanAirlines Arena (Miami)
In addition to locking down exclusive venue deals, Ticketmaster also signs agreements to be the official ticketing partner or preferred ticketing platform for specific sports leagues and teams. For example, Ticketmaster has had long-term partnerships with the NFL, NBA, NHL, and MLB. This grants them exclusive rights to distribute tickets for each league’s championship games and other playoff matchups.
Benefits for Venues in Ticketmaster Contracts
There are some key benefits that venues and stadiums get by signing exclusive ticketing agreements with Ticketmaster rather than selling tickets on their own.
Wide Reach and Established Platform
Ticketmaster sells tickets through an array of channels – their website, mobile apps, ticket outlets, and phone centers. They have a powerful branding and marketing engine. Venues can leverage Ticketmaster’s huge reach to maximize ticket sales and fill as many seats as possible for their events. It takes time, money, and expertise to build distribution channels of that scale.
Advanced Ticketing Technology
Ticketmaster offers venues advanced ticketing software and analytics tools to optimize ticket inventory and pricing. Their data and technology capabilities help venues enhance ticket sales. Venues may lack the resources to develop comparable ticketing technologies on their own.
Protection from Ticket Brokers and Scalpers
Having an exclusive deal with Ticketmaster allows venues to circumvent ticket brokers and scalpers selling marked-up tickets on secondary resale sites. This enables venues to retain more control over pricing.
Upfront Revenue in Contracts
The contract fees and revenue guarantees that Ticketmaster offers venues provide guaranteed income. Reports indicate these venue deals can be worth mid-seven figures for a single year. This gives the venue financial certainty.
Reduced Labor Costs
With Ticketmaster handling ticketing logistics and sales, venues can reduce their labor costs in their box office and ticketing departments.
Benefits for Ticketmaster in Venue Contracts
Ticketmaster also gains some key advantages by signing exclusive ticketing contracts with major venues and stadiums.
Control Over Ticket Inventory
Having exclusive ticketing rights at venues means Ticketmaster controls the supply of tickets for events at that location. This grants them enormous sway over the primary ticket market. They can steer inventory to their own resale platform, for example.
Revenue From Fees and Upsells
As the exclusive ticketer, Ticketmaster earns revenue from all the convenience fees, processing fees, and upsell offers applied during the ticket buying experience. They have full ability to leverage these revenue streams at venues where they have exclusive rights.
Consumer Data
With so many customers forced to use Ticketmaster for venue events, their platform sees extremely high traffic volume. This provides Ticketmaster with very rich consumer behavioral data that they can use for targeted advertising and personalized upsells.
Competitive Advantage
By locking down deals with premium venues, Ticketmaster solidifies its competitive moat. It becomes the only ticketing option for the most popular concerts, games, and performances. This exclusivity strategy makes it harder for competitor ticketing platforms to encroach on their market share.
Brand Awareness
Widespread venue deals reinforce Ticketmaster’s brand dominance in the minds of consumers. Ticketing exclusivity at stadiums constantly exposes fans to the Ticketmaster brand.
Anti-Competitive Concerns
Ticketmaster’s extensive venue contracts and dominant market position have also drawn criticism and anti-competitive concerns over the years. Some key issues that have been raised:
Lack of Consumer Choice
Fans have no ability to shop around or choose an alternative ticketing platform when Ticketmaster has the exclusive rights at a given venue. This lack of consumer choice enables Ticketmaster to impose higher fees.
Barriers to Entry for Competitors
By locking up deals with the most popular venues, Ticketmaster makes it extremely hard for competitors to gain market share. New ticketing platforms have no access to premium event inventory due to Ticketmaster’s exclusivity.
Antitrust Violations
Ticketmaster has faced accusations of violating antitrust laws through anti-competitive practices. Their exclusivity agreements and aggregated market power raise concerns about monopolistic behavior.
Unfair Pricing
Some perceive Ticketmaster’s extensive service fees and charges to be unfair and excessive pricing enabled by their market dominance. Fans have complained about exorbitant fees tacked onto ticket prices.
Retaliation Against Venues
There have been reports of Ticketmaster retaliating against venues that choose to use other ticketing services, making it risky for venues to go against them.
Year | Anti-Competitive Concern |
---|---|
1994 | Pearl Jam complained about Ticketmaster’s excessive fees and antitrust violations. They refused to use Ticketmaster for their tour. |
2009 | Ticketmaster and Live Nation’s proposed merger was initially opposed on anti-competitive grounds before being allowed to proceed with antitrust conditions. |
2013 | Ticketmaster signed a new deal with the NFL that required teams to use Ticketmaster, shutting out competitors. |
2017 | Some venues complained that Ticketmaster was threatening retaliation for using rival ticketing services like AXS. |
Government Scrutiny of Ticketmaster
Given the anti-competitive issues, Ticketmaster’s practices and venue contracts have drawn scrutiny from government regulators over the years.
Pearl Jam vs. Ticketmaster in 1994
In the early 1990s, the rock band Pearl Jam took issue with Ticketmaster’s high service fees. They refused to use Ticketmaster for their concert tour in 1994. The band testified before Congress that Ticketmaster was a monopoly engaging in anti-competitive behavior through exclusive contracts with venues. However, no major government action resulted at the time.
Live Nation Merger Review in 2009
When Live Nation and Ticketmaster proposed merging in 2009, the U.S. Department of Justice conducted an in-depth review to assess the competitive impacts. Initially, the DOJ opposed the merger on anti-competitive grounds.
Eventually, the DOJ allowed the Live Nation-Ticketmaster merger to proceed in 2010, but only subject to certain antitrust conditions. These included:
- 10-year anti-retaliation provision banning retaliation against venues that use other ticket companies.
- Ticketmaster must sell a subsidiary that provides ticketing services to venues.
- Fair AXS Act provisions banning exclusive contracts longer than 5 years.
Bruce Springsteen and Anti-Trust Complaints in 2021
In 2021, Bruce Springsteen and his team filed an antitrust complaint against Ticketmaster. They accused Ticketmaster of abusing its power through coercive tactics in venue contracts. This complaint is still pending litigation.
The Boss claimed Ticketmaster’s exclusivity agreements lock out competitors, leading to higher fees and poor service. This spurred new scrutiny of Ticketmaster’s anti-competitive practices.
Conclusion
Ticketmaster does indeed have extensive exclusive ticketing contracts with many major venues and stadiums that grant them control over ticket sales for events held there. This ticket distribution dominance provides benefits for both Ticketmaster and the venues in terms of sales reach, revenue guarantees, and advanced technology capabilities. However, it has also led to anti-competitive concerns, government scrutiny, and consumer dissatisfaction over limited choice and high fees. Despite past attempts to rein in Ticketmaster’s power, the company still largely maintains its grip over primary ticketing services at premier live event venues.