Corruption
in the Music Industry
I consider myself to be a fan of all types of music and I like to
stay involved with the music world. Music is such an integral part
of society in so many different aspects. Music defines time periods,
brings back childhood memories, educates, relaxes as well as
inspires. Stop and think for a moment if the music stopped, what
would the world be like? A sudden silence overcoming the world.
More realistically, stop for a moment and think what it would be like
if you could not see your favorite band in concert.
This is a scenario that is becoming more apparent. In upcoming
news the rock and roll band U2 has launched a world wide tour and
they plan to come here to Tempe to play Sun Devil Stadium in the
beginning weeks of May 97. The political group Rage Against The
Machine will also be opening for U2. I am a fan of both of these
bands so I looked into getting tickets for the show. I have found
some shocking results as far as tickets go as well as tickets for
other bands. For the U2 shows it can cost up to $61.60 for ONE
ticket. ÒThanks in part to eye-popping Ticketmaster telephone
service fees of $8.35 per ticket, a set of tickets for U2Õs May 31
show at New JerseyÕs GiantÕs Stadium cost a fan $246.40 for four
ticketsÓ(Boehlert 25). As a freshman in college on a tight budget it
is extremely difficult for myself to pay that much money for one
ticket with a $8.35 surcharge. I am sure that many people can
empathize with not wanting to see some of your favorite music at
such a high price. Why must the surcharges be so high?
This is just one example of the manipulative business manner
in which Ticketmaster operates. Ticketmaster is a ticket agency
that distributes tickets for concert, sporting, as well as theatre
events , to name a few. Ticketmaster now controls almost 90
percent of the American ticket market. Ticket master has grown so
large and powerful they have been randomly increasing surcharges on
their tickets as well as monopolizing the rest of the market making
it virtually impossible for smaller industryÕs to survive. I propose
that action should be taken. Ticketmaster as well as other agencies
should be federally investigated regularly and their should be some
standard for their surcharges. Ticketmaster also should not be able
to monopolize the rest of industry. It seems as if until recently
no public actions have been taken to expose and investigate
TicketmasterÕs practices. Much of what Ticketmaster has been doing has
gone unexposed and more importantly unchallenged. In 1994 the rock
group Pearl Jam had enough and they did something about. They took
Ticketmaster before the House of Representatives to be investigated on
behalf on random surcharges and also monopolizing other businesses. The
band was trying to lower the cost of their concert tickets and they
noticed the random surcharges that Ticketmaster would apply. As Pearl
JamÕs manager Kelly Curtis stated, Ò we were finding that in a lot of cases
the service charges were changing randomly. Sometimes it would be
five bucks, sometimes it would be eight, and we didnÕt understand
whyÓ(Marks 96). The band felt that their fans were being ripped off
and they wanted to do something about it. The next step they took
was trying to go through ticket agencies other than Ticketmaster.
The first opposition came when they tried to stage a free concert.
ÒPearl JamÕs peculiar ethic first brought them at odds with
Ticketmaster which during the 1992 Labor Day weekend, when the
band staged free concerts for Seattle fans. Ticketmaster wanted to
assess a $1 service charge for each free ticketÓ(Moody). The band
eventually refused and gave out the tickets themselves but this is
just the type of business style that Ticketmaster has become
notorious for.
Next Pearl Jam tried to tour through an agency called the
Netherlander Organization, but Ticketmaster subsequently
threatened to sue because of contract violations. Evidently
Ticketmaster had Òexclusive contractsÓ with certain venues.
These exclusive contracts contain two interesting provisions- one of which
explains the variety of high levels of Ticketmaster surcharges. Arenas or promoters
who sign them are prohibited from allowing anyone else to sell their tickets; and
Ticketmaster ÒrebatesÓ or in the word of its critics Ò kick backÓ some of the service
charges to its contractors. Venues that have entered into such agreements with
Ticketmaster are reported to have taken in as much as $500,000 per year from the
tickets as a result- payment essentially for freezing competitors out of the
marketÓ(Moody 5).
This further illustrates TicketmasterÕs monopoly over the rest of
the industry. They are so powerful that they can pay off other
venues and promoters to keep other agencies from using those
arenas. And this had been taking place for a while. There has been
no regulation against these practices by Ticketmaster.
I also personally tried to find out if their was some standard
from which Ticketmaster assigns its surcharges. Ticketmaster has
a supposedly ÒefficientÓ on line service for information as well as
ticket purchasing. I browsed through it and I always saw places to
click on to order tickets but it took me a while to find a place to
inquire about surcharge standards. I received a e-mail the next day
with a response. In that response Richard Tafoya, the Help Desk
Coordinator informed me that Ò Ticket companies are far more
expensive to run than most people think. Since most of out clients
tend to do high profile ticketing, weÕre obligated to spend a lot to
develop programming, software, and hardware to meet their needs.Ó
ThatÕs fine that it costs them more, but they did not once in their
response answer my question. I wanted to know what their rates
were for surcharges and they told me why they charged a lot without
the standards. This kind of inadvertent response was also given to
another on line member who had a question regarding seating for a
Red Hot Chili Pepper concert. It took 385 letters to Ticketmaster
on-line to get a response regarding the seating at the concert. The
response by Ticketmaster did not answer the question but refer this
person to a phone number to call. Once again it is this neglect to the
public that Ticketmaster is constantly demonstrating.
Most recently Pearl Jam had employed the California based
ETM Entertainment Network to handle distributing tickets. The
agency works to keep ticket prices low and uses a phone service
method of ordering tickets. It has been said that it can be a slow
process but it definitely works. Ò A big-time Pearl Jam tour, playing
major venues booked by major promoters and ticketed through
Ticketmaster, would likely have produced tickets averaging
somewhere around $45. The low-key bookings the band has arranged
are instead producing ticket averages in the $20 rangeÓ(Guinto 1). As
proved by this company ticket prices can be kept at a lower price
and tours can still be run. Most recently Pearl Jam has decided to
work through the FT&T(Family Tours and Tickets) , a Philadelphia
based agency to start of its 1996 tour. There is also another
alternative to keeping ticket prices low. In response to the
monopolistic agencies ÒTicketWeb was established in 1995 to
provide a low cost, and consumer- oriented alternative to
traditional ticket selling systemsÓ(Dreskin). Initially started to
handle Sanfrancisco related concert tickets it went nationwide in
1996. TickeWeb not only offers the traditional box office or charge
by phone services but also via the internet as well as the newly
implemented reserved seating methods. More importantlyÓ
TicketWeb offers services charges based on a percentage of each
sale ranging from surcharges of anywhere from 50 cents to the
maximum of $2.50(which is still significantly lower than
Ticketmaster fees)Ó(TicketWeb on-line). Ticket Web is a relatively
new develop in ticketing options but it has the promise of growth to
meet the needs of many different concerts. These are just a few of
the newly forming, cost effective alternatives to Ticketmaster.
I believe it has been illustrated clearly the Manipulative
business style that Ticketmaster has been practicing. In the long
run, through Pearl Jam and investigations, Ticketmaster is now more
exposed to the government agencies as well as the public. Finally a
stand has been take on the part of Pearl Jam and now more bands are
beginning to join the battle. ÒAlready bands such as Green Day and
The Offspring have lowered their ticket prices(Green Day has played
arenas for as little as $12.59) and forced Ticketmaster to lower itÕs
service charges, tooÓ(Marsh, Dave ).
I believe the solutions to be very simple. Ticketmaster (as
well as other ticket agencies) should be further and more regularly
investigated regarding business styles. It has been proven by Pearl
Jam and other ticket agencies, such as ETM and FT&T, that ticket
prices can be kept low and tours can still run smoothly. In addition
agencies should not be allowed to enter into Ò exclusive contractsÕ
with arenas and promoters which shuts out the opportunity for other
agencies. No one company should have the power to control an entire
industry through kick back deals with promoters. This automatically
excludes those businesses that are either too small to compete or
just starting a business. Groups should also have the freedom of
choice to negotiate contracts with more than one ticket
agency. Something is very wrong if one agency has the power to
dictate service charges for their tickets, disallow a band to use less
expensive means of selling tickets, and then shut them out from
other arenas(Stone Gossard and Jeff Ament before the Sub-
committee). Also the surcharges of any ticket agency should be
printed separately on the tickets so the consumer knows exactly
how the money is being split up. This settles any questions anyone
may have as to how much is going to each specific agency.
In conclusion this area of the music world should be exposed to
the public as well as to the regulatory agencies. Companies should
not have such a stronghold on any market thus shutting out other
competition. Hopefully there will be more articles written on such
practices and the word can be heard. The more information that is
reported the more exposed it will be to the public. Also it will take
the united efforts of artists to make a change. In the long run maybe
if such practices are exposed ticket prices will change and a
college student would be able to go see that U2 concert.
Bibliography
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kyle22@imap1.asu.edu