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Report: Ticketmaster Recruits Scalpers To Promote Resale Business, Increase Fees

Nobody is surprised.

It is no secret among the music industry and to many fans that Ticketmaster does some shady things with their ticketing. The focus has been on secondary ticketing and fees, but once Ticketmaster got into secondary ticketing, the question was how can a company be both the primary selling point AND the secondary selling point? They say the secondary market is inevitable and they are creating a safe way for fans to buy tickets, but in the end it is just another way to make more fees and money. An investigation by the Toronto Star and CBC show that Ticketmaster is recruiting scalpers to help sell on their secondary ticket market, which has higher fees, not being transparent about how many tickets go on sale initially and then putting them on the secondary market for a higher price (higher fee) and much more.

The root of the problem is that Ticketmaster charges fees twice when they can put something up on their reseller site. They get the fee from the initial sale and then again from the second sale. So it is in their best interest to sell the tickets on their secondary ticketing sites.

They say the sales are done by “fans,” but often they are by scalpers and brokers who can sign up through Ticketmaster Trade Desk, which they pitch as the “most powerful ticket sales tool. Ever.”

Ticketmaster explained their secondary market in a statement. 

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"As the world's leading ticketing platform, representing thousands of teams, artists and venues, we believe it is our job to offer a marketplace that provides a safe and fair place for fans to shop, buy and sell tickets in both the primary and secondary markets," wrote Catherine Martin, senior vice-president of communications. However Ticketmaster refused to answer any of the questions about the rest of the reporting. 

The CDC and Toronto Star sent two reporters undercover went to Ticket Summit 2018 in Las Vegas in July, a live entertainment and ticketing convention. They posed as scalpers and were pitched the professional reseller program by Ticketmaster. The Ticketmaster rep told them that bots and fake identities were not an issue. "I have brokers that have literally a couple of hundred accounts," one sales representative said. "It's not something that we look at or report."

You can buy bot programs on the web for just a couple of hundred of dollars, so if Ticketmaster is going to look the other way, somebody looking to flip tickets on major arena tours could make a lot of money very easily. Here is the Ticketmaster reseller handbook if you want to get involved.

One of the larger issues at hand that don’t get addressed is that Ticketmaster then throws the problem back to the artist and the promoter, who often time is Live Nation, which owns Ticketmaster. This is where their merger, which was approved contentiously by authorities in 2010, is calling into question competitive balance. Can a promoter really own a ticketing company when it can control the ticket prices and the fees at multiple steps of the process? Should AEG own AXS ticketing?

This will likely all get settled out of court because Live Nation is a massive company with battalions of lawyers and then a few brave, somewhat wealthy plaintiffs and lawyers will get paid. In the end, consumers will lose. They always do.

If artists would stop working or promoting Ticketmaster, then maybe something would happen, but they need Live Nation because it owns such a large section of the market. 

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