Ticketmaster CEO Azoff On Scalping, Er, Dynamic Pricing
Having lost our Worst Company in America contest to AIG, Ticketmaster CEO Irving Azoff today accepted as his consolation prize an on-stage interview with The Wall Street Journal's Kara Swisher at the annual D conference. A long-time talent manager, Azoff was introduced via video by Eagle Joe Walsh who joked that Azoff has "a beautiful house that we bought him." Then things took a turn for the worse.
Azoff reiterated his oft-quoted comment that he wouldn't have purchased TicketsNow if he had been CEO at the time of the deal. His rationale: Artists don't get any money from resellers like TicketsNow. As Azoff sees it, "dynamic pricing" of tickets is fine, as long as musicians (and, presumably, their managers) are able to share in the take.
The CEO brushed aside complaints from artists such as Bruce Springsteen that Ticketmaster abuses its near-monopoly power over the concert-ticket business, saying that "everything we do revolves around what's good for the artist and what's good for the fan. That's our new model." Pushed for more details, Azoff made it clear who he thinks is really the boss: "I would say that Bruce is uninformed about the potential of what this could be for him."
"We haven't done enough dynamic pricing for tickets, and we should, and that will help make people happy," he said. We assume those happy people will include Irving Azoff and, oh, Irving Azoff. And, conceivably, anyone willing to pay a premium for tickets. The rest of us may just have to face a Tenth Avenue freeze out. Or worse. In response to one audience question, Azoff warned that "we have to keep the press from chastising artists that use dynamic pricing." Good luck with that.
Irving Azoff, CEO of Ticketmaster Entertainment [All Things D]
D7 Video: Ticketmaster CEO Irving Azoff and Kara Swisher
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(Photo: nerdy girl)
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Comments:
@emmpee9:
Absolutely nothing. Just don't bitch when it happens to your gasoline, prescriptions -- err -- nevermind. Already happening.
@emmpee9: Capitalism only works in a fair market. Ticketmaster (and to some extent LiveNation, yay merger) have a stranglehold. You don't want to use them? Your band can't go on tour.
Ticketmaster does NOT set the prices for events. Nor is it responsible for what people do with them once they are purchased. Ticketmaster also does not make set the amount for the fees per ticket, the artist does and the venue does. Regardless Ticketmaster DOES have to make money, its a business after all. They have employees to pay and costs to run it. So all this hate seems ridiculous to me. If someone doesn't like their "monopoly" they can go to the boxoffice directly or start their own ticket company. It's not TM's fault.
@xoxor: Surely you see the difference between price controls on prescription medications and concert tickets.
@emmpee9: The problem is that you can't pay market price if the tickets aren't there. If the artists reserve a block of tickets, then turn around and sell them after all the others have sold out, which they did quicker due to the diminished supply by reserving them, how is that "fair"?
@emmpee9: There isn't any competition, though. And most people can't or won't pay tons of money to go to a concert. Only rich people. So basically us normal folk will never get to see concerts. Yay. Not.
But, again, no competition means it's not capitalism.
@emmpee9: natural monopolies should be regulated when prices are much higher than average cost. err, or something...
@emmpee9: Does that have anything to do with what goes on backstage off a mirror and/or hooker's ass? Oh, wait, PRESCRIPTION medications. Nevermind.
@sweetnjoe: So how do you explain TicketMaster selling tickets to "sold out" events on a site they owned at inflated prices? Where did they get the tickets from?
@nakedscience: So rich people will pay more money to see a concert than you want to. What's wrong with that? Replace "see a concert" with "buy a BMW" and you might see where I'm going here.
@Darrone: You're not serious, are you?
I saw a band last week without having to pay Ticketmaster or LiveNation a cent. Therefore, bands can tour without these companies' permission.
I think that if ticket scalping is a serious problem, that's a good sign that they aren't charging enough for the tickets in the first place. If they charge enough that some people decide it isn't worth that much money, thus the amount of people trying to buy the tickets equals the amount of tickets available, then there would be no profit in ticket scalping, and it should not be so common.
Trying to get rid of ticket scalping by going after the ticket scalpers only changes the situation so that getting a ticket depends on luck and being among the first to try to buy it, thus making many people who really want to go simply unable to obtain tickets.
@TheFlamingoKing: Where did you see that band? At a bar, or small, out of the way venue? I know it wasn't a large venue, because almost all of them have exclusivity deals with Ticketmaster/LiveNation.
Ticketmaster has locked up all the most profitable venues and events. So, yeah, a band can tour without Ticketmaster, just like it's possible for me to walk from my home (near Detroit) to Florida. Just because it's possible doesn't mean that it's viable, or even a good option.
@GenerousHelpingOf_GitEmSteveDave: Market Price != "Price printed on the ticket".
As far as I'm concerned, the band/venue/ticketmaster (basically whoever is running the concert) can sell tickets in any quantity, manner, timeline, etc they want. After all, it's THEIR concert. Not yours. Don't like it? Vote with your wallet.
@emmpee9:
It's just the same old whiney class warfare angle again. Some people never get tired of it.
If there were no demand for the tickets, then ticketmaster couldn't sell them for the prices it asks. If oodles of tickets were unsold at the very end, that I would find troubling but as long as it's a packed house, market forces worked it out. Seeing as concert tickets might fall into the very definition of discretionary spending, it's almost obscene to see how much people whine about it.
@sweetnjoe: 1) many (probably most) venues don't have their own box offices anymore, and if they do, they are run by ticketmaster and you pay TM fees.
2) Many (most) venues have deals with ticketmaster so if your band wants to play a venue without ticketmaster, you are going to be playing at your friend's basement - and you may not be able to play a ticketmaster venue in another city later on.
3) Many (most) venues have a deal with ticketmaster so if you want to start your own ticket company, you are going to be selling tickets to your friend's basement.
Certainly, there are a few alternatives to Ticketmaster out there, but none of them are really feasible for a big name artist. And none of them ever will be, as long as Ticketmaster has a stranglehold on the available product.
@GenerousHelpingOf_GitEmSteveDave: Um, the artists...
Check the links in the article above.
[consumerist.com]
To be more clear: The artists are holding thousands of tickets and then selling them on ticket websites for more cash. Not really Ticketmaster's fault - more like they're helping the artists deceive the fans that love them so.
@emmpee9: Nothing's wrong with paying market price. The problem is that a monopoly (like TicketMaster, which sells all tickets for basically every large venue and a high proportion of smaller ones, and which also controls a good portion of the secondary market through StubHub) is nothing like market pricing in the first place. Market price isn't just whatever the seller feels like charging, it's the point where as many people want to sell tickets as want to buy them. Ticketmaster sets their prices higher than this point, then tacks on fees on the top of that. That means that fewer tickets are sold at a higher price than would otherwise be sold. Except for a few top acts, that means that bands play to half-empty halls and fans can't afford tickets. (Well, with top acts fans still can't afford tickets.) Bad for the bands, bad for the fans, good for TicketMaster though!
If I read correctly, artists are holding the tickets for their own shows, and then selling them via ticket websites to increase their income from each show.
If true, then Azoff is only stating that with enough PR, people can learn to like this behavior if they legitimized it rather than let it continue in the darkness.
In which case, commenters would be better served to bitch at the artists that rip off their own fans than the company that sells them the ticket.
But no one wants to believe their favorite band is trying to screw them out of money or only allow those rich enough to attend. Instead, it's the evil corporations fault! Let's get 'em!
@henwy: From an economic point of view, all spending is "discretionary". That doesn't make a difference. A surprising number of bands go on to half-full houses because their tickets are priced too high for their fans, and concert attendance has been falling steadily since the 1980s as ticket prices rise.
@emmpee9:
I do vote with my wallet, and hardly ever go to concerts anymore. It's a shame others won't do the same.
What's the problem with paying "market price"?!!! The problem is by paying that price, one helps contribute to the greed that has all but destroyed the concert industry and kept ticket prices so high.
No concert, by any band, should cost as much as what's being asked these days, and the excuses by the industry aren't adding up to the price of the ticket. They haven't for over a decade now.
The only way to stop it, is to somehow convince the morons who have no problem blowing over $100 a ticket for a concert, to stop. Sadly these people are just way too dense to see the logic behind such things.
@TheFlamingoKing: Where did u see them, a local bar? Ticketmaster has exclusivity deals with most major venues. If the venue is big enough for a national tour, then you can't play there without wetting Ticketmaster's beak. You're a stadium owner that wants to avoid Ticketmaster? well then, they won't let the bands they do business with play your venue. A fan who doesnt want to deal with TM? you're shit out of luck.
@Shaggy: Oh, I'm sorry. That was unclear. Darrone asserted that "your band can't go on tour" because of the Ticketmaster "stranglehold". That statement was proven false.
Now, if you want to put limits that say "If you're a top 50 RIAA artist and you want to play in specific large venues that are part of Ticketmaster's network" then you may be correct.
Also, at no point to you explain why the band must perform at the "most profitable venues and events", unless the whole thing is just to maximize profit - in which case, offering a band "dynamic pricing" is perfect. The band just wants to sell each ticket for as much money as they can because it's about the money, not the fans or the show.
Uh, explain this to me then. Why do I have to pay a fee to print out my tickets to U2 on MY printer using MY paper and MY ink, but they will mail them to me for free? Shouldnt it be the reverse, if its about covering their costs?
@Jesse: You mean Fleetwood Mac priced them at 150, and Fleetwood Mac was unloading them at a cheaper rate.
Need to have a balloting system as there is in Japan for the really big concerts. First you have to be a member of said artist's fan club (which some require a Japanese address), then you can enter your name for ticket balloting, if you get picked you can buy your ticket. This helps a bit however you can still buy tickets through second hand shops on the street and through online auction sites! But at least it ensures true fans have a fair chance at getting tickets.
@sweetnjoe: If you walk to the box office of the venue, you're still buying tickets from Ticketmaster. And you can't start your own ticket company. TM has exclusivity agreements with all of the major venues in the country. You can't mount a national tour in venues that hold more than about 2,000 people without going through Ticketmaster. It's simply not possible because TM has exclusive contracts with every single venue. Look into the Pearl Jam lawsuit in the last 90s. Pearl Jam, one of the biggest bands in the world at the time, tried to mount a national tour without Ticketmaster and couldn't do it. I honestly don't understand how they lost their suit, but I'd imagine it goes back to the money and power that TM has.
@TheFlamingoKing: It's not the artists selling the tickets on StubHub just minutes after the tickets go on sale. Google "Bruce Springsteen ticketmaster" for more info.
@kmw2:
That's just idiocy and a poor attempt of sophistry at that. There's a clear difference between discretionary and non-discretionary spending, though the edges might blur. Think of your classic Venn diagram if it helps. There's a good reason to keep some price controls on staples like say, course flour or milk, in order to avoid periods of glut/famine. To argue that concert tickets are in the same category is asinine.
@TheFlamingoKing: Not all artists are doing it. Look into the Bruce Springsteen issue where Ticketmaster took a bunch of tickets without his blessing and moved them over to StubHub just moments after the tickets went on sale. The extra margin from the StubHub sales went straight to Ticketmaster. It's some shady, shady shit.
@henwy:
That's just it. In most cities, larger tours aren't "packing the houses" anymore, but are still bringing just enough people in to justify putting on the tour, as well as give a reason why the tickets cost far more than they should.
A few major acts only truly "pack them in" anymore in the U.S., unless it's a show played in a major city. Sadly the major bands and promoters are reaming the fans. Look at the U2 arena tour. In Virginia, they are asking $250 a ticket for the floor. If anyone on this forum thinks that it's "o.k." to charge that much, I'll show you a sucker, or someone who is full of $hit.
It's obscene that anyone would defend these high prices and then clammer on anout how obscene it is that people "whine" about it. The backlash has to begin in some form, and it isn't "whining" for some, as much as it's trying to get more and more to understand and get involved with a full on boycott.
If "oodles of tickets" went unsold, it wouldn't be "troubling", it would be a thing of beauty. Consumers finally using their own power for a change, can never be "troubling".
This isn't "class warfare" either. Some of us are far more passionate about music than most of you are, and it's people like you that make us sick. I can afford to go to these overpriced shows, but I am just not that friggin' stupid, nor am I dumb enough to try and justify that it's right to ream the consumers who will pay the price all in the name of our corrupt capitalistic system.
What IS obscene, is the high cost of entertainment these days, and even worse, those who defend the cost as well as those who support it due to a lack of self controle. By some of your reactions towards the high price of concerts and such around here, it makes me wonder if I'm really at a consumer blog, or at a convention for media industry ball washers.
@emmpee9:
Ticketmaster is a monopoly. If a band doesn't want to follow Ticketmaster's dictates, it won't find a venue in which to play simply because there is no alternative.
You can't vote with your wallet in a one-party state.
What this means, that nobody wants to say, is that the average joe is going to walk away from the only other mode of support some artists have. A lot of artists could bear the loss of CD sales due to downloading because the amount they made off of them was largely negligible. Personally, I'd always rather see an artist live, but if I don't do that, it's possible the recording/music industry will never see a dime from me again. Most of the music I listen to I've already paid for, and new music I listen to on the radio. I don't buy overpriced merchandise, and now if I want to see an artist live, I'll watch a video of it if its available. Way to go, TM...help piracy along.
@NumberFourtyThree: And if the band decides that they'd rather play a concert in front of the sort of rabid fans who'd camp out for days to get a ticket, who are you to tell them "No, you should instead play to this crowd of monied jerks who paid 10 times face value"?
Bands on tour can actually have motives beyond just 'extracting the maximum profit possible'. Things like 'growing their fan base', for example, which isn't done by catering exclusively to people who can afford to pay $500 for mediocre seats.
And even if the idea is to extract the maximum profit possible, massive ticket prices can still hurt their bottom line. Consider that you're a venue owner and Metallica is coming to play your venue. You'll get some cut of the gate, as will the band and their record company. However, as the venue owner, you'll be selling concessions, and Metallica will be selling t-shirts, DVDs, CDs, and all sorts of other merchandise, some of them at incredibly marked up prices. Maximizing both your revenue stream and Metallica's revenue stream involves getting people to come to the concert with money in their pocket as they walk in the door.
And yet, the more expensive tickets are, the less money those consumers will have. So they decide not to drink your $8 beers, or to just have a bottle of water instead, or that they really don't need another Metallica tour t-shirt.
So, no, completely soaking the consumer for the maximum ticket price he's willing to pay is not always an optimal strategy, and by attempting to drive the market towards this, ticket scalpers can do damage to the business plan of the band and venue while adding absolutely no value to the experience.
@TheFlamingoKing: @TheFlamingoKing: What Ticketmaster does is that they sign exclusivity contracts with VENUES. You are locked out of hundreds of halls and stadiums if you do not agree to sell your soul to ticketmaster and screw your fans. Then the proceeds are split between the venue owners and ticketmaster leaving the fans and the artists out in the cold.
i would love to see bruce [or another artist of his magnitude] try to work out a deal with the venues directly, and sell the tickets through his & the venues' websites.
although i don't know if it's at all possible, being as that most large venues seem to be under ticketmaster/livenation's lock and key.
tell you what, though, he's pretty good about ticket prices. i saw simon and garfunkel a few years ago--$110 for tickets. identical seats for bruce? $60. nice.
If I were an artist like the Boss or anyone with any pull, I'd tell Ticketmaster to go fuck themselves. But then again, I don't make my living doing that sort of thing, while they do.
Blame the artists. They're just as responsible. No one is forcing them to do anything, they just do it anyway. That's why artists that do this need to be called out. The only way they'll know it's a problem is if their fans say it is, because let's face it, they're rolling in dough and don't give a shit. Hey, they should run for some sort of political office!
There is no such thing as market pricing for tickets. The only reason people are spending 200% - 1000% over face value is because they think they need to go to some event. Scalpers play off these feelings. You aren't missing anything by missing a hannah montanna or lady gaga concert. The recession should put a lid on people paying these prices.












What's wrong with paying market price for tickets, exactly? Capitalism and all that. If you don't like it, vote with your wallet.