Found this article posted today on www.cnnmoney.com. Everyone complains about TM's excessive service charges.... and with reason.
http://money.cnn.com/2007/10/11/pf/raw_deal_ticketmaster/index.htm
NEW YORK (CNNMoney.com) -- Hankering for some live music or sports this fall? Be prepared to shell out some cash. Above and beyond the rising face value of tickets is a heaping helping of service fees.
Nearly anyone who has ever ordered a ticket through Ticketmaster will say the charges, which can be as much as 40 percent above the face value depending on the event, are excessive.ticketmaster.03.jpg
The company claims it's the cost of doing business, but consumers are tired of paying through the nose for nose-bleed seats, and even some politicians are considering capping the fees levied by ticketsellers.
There is no doubt that Ticketmaster has mastered the ticket-selling business. The company, which is a division of IAC InterActive Corp. (Charts, Fortune 500) has 9,000 clients (mainly arenas, stadiums and theaters) in 20 countries and exclusive rights to sell tickets through its Web site, retail outlets and call centers.
Last year the West Hollywood, Calif.-based company sold more than 128 million tickets with a face value of over $7 billion and raked in the service fees.Post your thoughts and see what others think
On top of the face value of a ticket, which is determined by the promoter, venue or artist, Ticketmaster levies a convenience charge that covers the costs of providing tickets at local ticket outlet locations, staffing call centers and ongoing maintenance of its Internet-based system. But ticket buyers must pay this charge regardless of how they purchase their tickets, be it on the phone, online or in person.
In addition to the convenience charge, there is also an order processing fee which covers taking and maintaining the order, arranging for shipping or coordinating with the box office will call. And in almost all cases, additional delivery prices may be charged based on the delivery method.
Standard mail and will call are usually, but not always, free, although other delivery options, like FedEx, UPS and even email cost extra.
There can also be a facility charge, which varies depending on the location and goes directly to the venue, not Ticketmaster.
So say you purchase a $35 ticket through Ticketmaster for an upcoming event, there could be a convenience charge of $8.35 (per ticket) in addition to a $3.15 order processing fee and $1.75 fee for an e-ticket. That adds up to a whopping 38 percent premium over the face value of the ticket price.
"Like any business, we have every right to seek a fair return on our investment and efforts," the company said in a statement.
Even artists have complained that the company's anticompetitive practices result in unfair markups of their concert tickets. In 1994, the rock band Pearl Jam attempted to sue Ticketmaster for refusing to lower its service fees for the band's tickets. But because Ticketmaster had exclusive contracts with so many large venues, Pearl Jam had no alternative but to cancel their tour.
Mass. Senator Michael Morrissey, co-chairman of the Legislature's Consumer Affairs and Professional Licensure Committee, said he is looking into legislation that would address the initial sale of tickets through Ticketmaster.
"We, in the Senate, might try to deal with a cap on charges," Morrissey said. Legally, he explained, the restrictions on administrative charges are a gray area but a greater level of transparency should exist as to what the charges cover specifically, in addition to a limitation on how high they can go.
"We are going to try to do something to reduce some of the burden on the public," he said.Tell us about another raw deal
Until then, and aside from appealing to the Antitrust Division of the Department of Justice, as Pearl Jam unsuccessfully attempted to do, what is an average concert goer to do?
The best solution is to circumvent Ticketmaster altogether by purchasing tickets directly from venue box offices. When this option is available, there is generally no convenience charge levied.
There are also a number of online competitors, like Tickets.com, that have popped up in recent years hoping to take a bite out of Ticketmaster's business. Sometimes, an act's fan club will provide tickets to a show on its own Web site via a rival ticketing agent with lower fees and charges.
But in many cases when the venue isn't offering advanced ticket sales and no other Web sites are selling them, the consumer has few choices: cough up Ticketmaster's fees, or try to purchase from a secondary seller (reselling is restricted in some states).
And if you do end up scoring some sought after seats through Ticketmaster, at least you can appreciate the fact that that "convenience" charge means that you didn't have to camp out in a folding chair all night.
This kind of reminds me of the Wal-Mart issue. Nobody likes Wal-Mart because they are bigger, better, and make more money than everyone else, causing small shops to close down. Well, you have to admit, TM is bigger, better, and makes more money than everyone else. The only difference is that Wal-Mart has real competition (Target etc.) and doesn't use monopolistic strategy (Walmart doenst go around buying up mom and pop shops, and they dont raise their prices at a store just because its the only store in town). People shop at Wal-Mart because Wal-mart has lower prices than competitors. People 'shop' at ticketmaster because they have exclusive (cough cough monopolistic) agreements to be the ONLY ticket seller for a majority of venues.
Personally, I don't complain about TM's service fees because what I pay for a ticket is what I pay.... would be nice to not pay the service fees but I'm still happy to pay that price for the ticket. The problem is, they are making so much money that their customer service should be top of the line, and it isnt. Oh well, its not like everyone is going to stop buying tickets from ticketmaster soon. Ticketmaster knows they don't need to charge as much as they do, and they know other ticket services can do what they do for cheaper (ticketweb... ticketwest... livenation tickets..) and thats why TM buys them out. It is just a matter of time before these competitors wise up and realize they can take market share away from TM, and don't have to join them.
Thursday, October 11, 2007
Wednesday, October 10, 2007
AHHHHHH HANNAH MONTANA!!!
Everyone knows that Hannah Montana, aka future president of the USA, is the hottest thing in town, and will be at least for the next few months. Ticket brokers agree that this is the HOTTEST tour EVER. Which is saying a lot. Asking brokers when the last time they saw a tour do so well for brokers and they scratch their heads.... not even U2 generated demand like Hannah Montana for tickets on the secondary market. So what is it about her? Is she super talented? Does she have the best writers writing her TV show and her music? Nope! She simply appeals to the most powerful age group in America like nobody else has done before. For example, look at what this mom (and her husband lawyer) are doing just to get Hannah Montana tickets. Ridiculous and wrong on so many levels.
http://www.ticketnews.com/North-Carolina-Parent-Sues-TicketsNow0100807
North Carolina Parent Sues TicketsNow Over “Hannah” Prices
Mon, 10/08/2007 - 3:13pm — TicketBuzz
By Alfred Branch, Jr.
It was only a matter of time.
Disgruntled North Carolina parent Lyn Peraldo, upset over the price she paid for Hannah Montana/Miley Cyrus tickets, filed suit against TicketsNow last week alleging the company and others essentially conspired to rig the system.
Peraldo was allegedly shut out when she tried to buy tickets last month for the Nov. 25 Montana show at the Greensboro Coliseum, and went onto TicketsNow.com and bought four tickets for more than $1,000 as part of a birthday gift for her six-year-old daughter. She then filed the lawsuit.
The lawsuit alleges that TicketsNow and others in the “ticket brokering industry” possess “a sophisticated system and the means (internet, telephone, pre-purchase and in person) to purchase at face value a number of the tickets identified herein in such quantities that Plaintiff and many others had no realistic opportunity to purchase said tickets from the ‘Greensboro Coliseum’ for face value, it being the specific business plan, intent and goal of Defendant to acquire and immediately resale as many of said tickets as possible at grossly inflated prices, which in this case it did to Plaintiff.”
"I watched parents with little girls, bursting into tears, walking back down toward me, saying they'd sold out," she told North Carolina TV station WGHP. The lawsuit is seeking in excess of $10,000 in damages.
According to a copy of the lawsuit, provided by WGHP, Peraldo claims she bought four tickets from TicketsNow.com for $225 a piece, despite the face value of the tickets being $56. She also allegedly paid a service charge of $135 and a shipping fee of $14.95.
Neither Peraldo nor a representative for TicketsNow returned messages at press time seeking comment.
Details of the lawsuit aside, what is really interesting here is the question of the legitimacy of ticket reselling. Hannah has brought out some very passionate parents (ok, and sometimes very mean parents) which has led brokers to passionately defend themselves. So who is right? Do parents have the right to be pissed at ticket brokers? Are ticket brokers wrong for selling tickets above face value?
There are some things being said in this debate that I would like to comment on:
1) "Ticket brokers are exploiting parents and the children who want to see Hannah"
Wrong. Selling tickets is not a trick. Brokers do not trick parents into buying tickets. It is not a scam. There is a product and a price, and parents choose to pay that price for the product, just like going to the grocery store and paying $5 for a case of Pepsi. The origination of the product is irrelevant to the sale of the product. So are Pepsi Distributors exploiting parents? They are making a profit that PepsiCo, the producers, don't see.
2) "Ticket brokers do nothing but take money away from those that really deserve to be making money"
Wrong again. Ticket brokers provide a service. Ticket brokers provide a means for fans to get tickets when they are unable to beat the masses on ticketmaster.com to get tickets. If reselling tickets was illegal and ticket brokers did not exist, would parents be happier then? Not if you ask the thousands of parents that paid the fair market price for tickets on the secondary market and made their children happy. Also, its not like Hannah, the promoters, or anyone else involved in making the tour happen is losing money when TicketsNow makes a sale.
3) "Ticket brokers cater to the rich"
True. Actually, lets think about it. Brokers provide a means for wealthy people to get the seats they want for the shows they want to go to. But what you never hear about... because nobody complains about this.... is that brokers allow the less wealthy fans to buy tickets often at a huge discount for less popular events. Season ticket holders to any baseball, basketball, or hockey team practicaly give tickets away for a lot of games, giving people without a lot of money a chance to see their favorite team at a huge discount.
4) "Ticket brokers are not good people, they simply make a living by leaching off the work done by promoters who make the event happen"
Wrong. Ticket brokers are good people. They are sales people and smart businessmen/women. If they were dirty low lifes, they wouldn't make it as a ticket broker. Believe it or not, there is a lot of competition and not every broker makes money. More importantly, ticket brokers provide a service and in the case of a lot of broadway shows, can provide financing for the show itself.
In the end, this is really about a bigger problem.... kids are spoiled and parents are so confused and so clueless as to how to make their kid happy that they spend $800 for one night of entertainment.
http://www.ticketnews.com/North-Carolina-Parent-Sues-TicketsNow0100807
North Carolina Parent Sues TicketsNow Over “Hannah” Prices
Mon, 10/08/2007 - 3:13pm — TicketBuzz
By Alfred Branch, Jr.
It was only a matter of time.
Disgruntled North Carolina parent Lyn Peraldo, upset over the price she paid for Hannah Montana/Miley Cyrus tickets, filed suit against TicketsNow last week alleging the company and others essentially conspired to rig the system.
Peraldo was allegedly shut out when she tried to buy tickets last month for the Nov. 25 Montana show at the Greensboro Coliseum, and went onto TicketsNow.com and bought four tickets for more than $1,000 as part of a birthday gift for her six-year-old daughter. She then filed the lawsuit.
The lawsuit alleges that TicketsNow and others in the “ticket brokering industry” possess “a sophisticated system and the means (internet, telephone, pre-purchase and in person) to purchase at face value a number of the tickets identified herein in such quantities that Plaintiff and many others had no realistic opportunity to purchase said tickets from the ‘Greensboro Coliseum’ for face value, it being the specific business plan, intent and goal of Defendant to acquire and immediately resale as many of said tickets as possible at grossly inflated prices, which in this case it did to Plaintiff.”
"I watched parents with little girls, bursting into tears, walking back down toward me, saying they'd sold out," she told North Carolina TV station WGHP. The lawsuit is seeking in excess of $10,000 in damages.
According to a copy of the lawsuit, provided by WGHP, Peraldo claims she bought four tickets from TicketsNow.com for $225 a piece, despite the face value of the tickets being $56. She also allegedly paid a service charge of $135 and a shipping fee of $14.95.
Neither Peraldo nor a representative for TicketsNow returned messages at press time seeking comment.
Details of the lawsuit aside, what is really interesting here is the question of the legitimacy of ticket reselling. Hannah has brought out some very passionate parents (ok, and sometimes very mean parents) which has led brokers to passionately defend themselves. So who is right? Do parents have the right to be pissed at ticket brokers? Are ticket brokers wrong for selling tickets above face value?
There are some things being said in this debate that I would like to comment on:
1) "Ticket brokers are exploiting parents and the children who want to see Hannah"
Wrong. Selling tickets is not a trick. Brokers do not trick parents into buying tickets. It is not a scam. There is a product and a price, and parents choose to pay that price for the product, just like going to the grocery store and paying $5 for a case of Pepsi. The origination of the product is irrelevant to the sale of the product. So are Pepsi Distributors exploiting parents? They are making a profit that PepsiCo, the producers, don't see.
2) "Ticket brokers do nothing but take money away from those that really deserve to be making money"
Wrong again. Ticket brokers provide a service. Ticket brokers provide a means for fans to get tickets when they are unable to beat the masses on ticketmaster.com to get tickets. If reselling tickets was illegal and ticket brokers did not exist, would parents be happier then? Not if you ask the thousands of parents that paid the fair market price for tickets on the secondary market and made their children happy. Also, its not like Hannah, the promoters, or anyone else involved in making the tour happen is losing money when TicketsNow makes a sale.
3) "Ticket brokers cater to the rich"
True. Actually, lets think about it. Brokers provide a means for wealthy people to get the seats they want for the shows they want to go to. But what you never hear about... because nobody complains about this.... is that brokers allow the less wealthy fans to buy tickets often at a huge discount for less popular events. Season ticket holders to any baseball, basketball, or hockey team practicaly give tickets away for a lot of games, giving people without a lot of money a chance to see their favorite team at a huge discount.
4) "Ticket brokers are not good people, they simply make a living by leaching off the work done by promoters who make the event happen"
Wrong. Ticket brokers are good people. They are sales people and smart businessmen/women. If they were dirty low lifes, they wouldn't make it as a ticket broker. Believe it or not, there is a lot of competition and not every broker makes money. More importantly, ticket brokers provide a service and in the case of a lot of broadway shows, can provide financing for the show itself.
In the end, this is really about a bigger problem.... kids are spoiled and parents are so confused and so clueless as to how to make their kid happy that they spend $800 for one night of entertainment.
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