Ask HN: Why is it so hard to disrupt Ticketmaster? • Hacker News Board

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#51

Post by vintermann » Thu, Nov 17, 2022, 3:44 PM UTC

HDThoreaun wrote: post #21

photochemsyn wrote: post #13

But mah free market ideology says competition will produce the best outcome for everyone, we just need more deregulation to fix things.

Ticketmaster exists because they kickback to artists and venues. This is is the best outcome for them. Supply of tickets is so limited that fan perspective is completely ignored, the tickets sell out anyway.

Kickback? I wouldn't exactly call it that, since it's the venue's seats, and the artist's acts it's selling.

The problem is more that they own the venues, and aggressively punish anyone who works with their competitors.

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#52

Post by fuzzylightbulb » Thu, Nov 17, 2022, 3:45 PM UTC

treepunch wrote: post #9

CabSauce wrote: post #2

I heard that ticketmaster has exclusive agreements with basically every large venue. So if performers want to play venues of over a medium size (large theaters, arenas), they're forced to use ticketmaster.

That's because most of the major venues are owned by LiveNation... which is the same company. When they merged in 2010 everyone saw this coming.

Tickemaster was terrible even before the Live Nation merger. The issue is that everyone is making money hand over fist at the expense of the consumer, while Ticketmaster is absorbing all the negative attention. Artists love selling out shows at a particular ticket price; it doesn't matter to them if the venue is full of true believers or if the true believers paid extra to be there so long as the "extra" is still within the price people are begrudgingly willing to pay. The venues love it because they get a portion of the ticket sales and the fees, and they don't need to manage the sale of tickets or employ folks to do so. No one in the chain is going to stick their neck out to kill the golden goose for the sake of the consumer. It's a mess.

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#53

Post by zeroonetwothree » Thu, Nov 17, 2022, 3:47 PM UTC

I think it’s not so straightforward what your competitive advantage is. Charging customers lower fees isn’t so simple because Ticketmaster splits the fees with the venue. So I guess you need to take an even smaller cut than 50%. But can you afford to run a profitable business off of smaller margins than that?

In a sense this situation came about because people want ticket prices to be ‘fair’. They don’t want to pay $500 for some concert even if that should be the market price. So it gets priced at $100 instead and Ticketmaster allows venues to recoup part of that with fees.

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#54

Post by pjlegato » Thu, Nov 17, 2022, 3:50 PM UTC

Ticketmaster works "well enough" that venues have no compelling reason to switch.

A startup may offer a "10% better" set of features, but that's not enough for the venue to justify the large switching costs and large risk that would be involved in trying out a competing product.

For such a switch to be justified, the alternative product's feature set would have to be 100x better -- a "gamechanger" that fundamentally alters the way the venue does business, not merely offers minor improvements.

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#55

Post by skeeter2020 » Thu, Nov 17, 2022, 3:51 PM UTC

koolba wrote: post #32

TicketMaster has exclusive contracts with the vast majority of venues and just about every large one. These contracts include kickbacks where TicketMaster will add $X of fees to each ticket it sells and pass back Y$ (Y It's essentially the venues and artists outsourcing the job of "being the asshole" to TicketMaster as a large chunk of the money eventually flow back. They get to publicly blame TicketMaster, claim the…

The artists can do better too, if they have the power to make TM share the upside (most don't) because TM controls much of the resale market and is also moving towards surge pricing. This is why they're pushing into virtual ticketing so hard (Ticket-less Master?)

TM also has huge vertical integration. If you want to perform a live show at almost any mid/large venue your tour is likely to be managed by Live Nation, and they are integrated down to artist representation.

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#56

Post by HDThoreaun » Thu, Nov 17, 2022, 3:52 PM UTC

vintermann wrote: post #51

HDThoreaun wrote: post #21

Earlier quoted context omitted.

Ticketmaster exists because they kickback to artists and venues. This is is the best outcome for them. Supply of tickets is so limited that fan perspective is completely ignored, the tickets sell out anyway.

Kickback? I wouldn't exactly call it that, since it's the venue's seats, and the artist's acts it's selling. The problem is more that they own the venues, and aggressively punish anyone who works with their competitors.

Half of the fees go to the artist and venue. Ticketmaster takes the position of the “bad guy” to take all the blame for high prices while artists can say “the tickets only cost $40” even though the real price is easily double that.

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#57

Post by nunez » Thu, Nov 17, 2022, 3:52 PM UTC

zwkrt wrote: post #41

eschneider wrote: post #19

I spent a fair bit of time researching this space as it seemed like an obviously good startup idea. It turns out that almost everyone who you think would benefit from a better system have already been coopted by the current players. It's definitely an uphill battle.

To put it into perspective I work for two years at Amazon to try to create a competitor to Ticketmaster. Our ticket sales infrastructure wasn’t quite as polished as Ticketmaster is but it was passable. What killed the product though is that we couldn’t get any reasonably sized contracts in the United States. So even a company with the motivation to burn capital the size of Amazon couldn’t swing competing with Ticketm…

Now that you mention it, Apple has the best shot at this given their relationships

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#58

Post by jnac » Thu, Nov 17, 2022, 3:54 PM UTC

chrishare wrote: post #26

shmatt wrote: post #12

In short: the anger over what happened yesterday is overblown. If a commodity is sellable, people will sell it. The ONLY option here is to make tickets non-transferable, full ID check to verify the name on ID is the name on the ticket Point 1: Let her sell it on a different website. Yesterday, Ticketmaster said millions, but it was probably more than 10 million people, logged in to try to buy hundreds of thousands of…

ID verification + limited transfers + pre-election via lottery?

My thought too- charging higher prices in the first place & passing the same % on to the venue would allow you to offer the venues a better deal while still allowing fans to pay less than they would to resellers.

Limited/no transfers - returns offered instead - offer flexibility to customers.

However as others have said I think the real obstacle is the venue relationships that came from the purchase of LiveNation. These are difficult to replace although maybe it would be possible to start with smaller venues and acts....or using public places a la music festivals.

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#59

Post by mikewebkist » Thu, Nov 17, 2022, 4:00 PM UTC

ID1452319 wrote: post #16

The reason resellers exist is because people are prepared to pay many multiples of the face value for tickets. If people stopped buying tickets on the secondary market, the resellers would be left with worthless paper they paid thousands of dollars for and the secondary market would disappear.

If artists and venues used market clearing prices there would also be much less demand for a secondary market. The "problem" Ticketmaster solves is that for someone like Taylor Swift the supply of tickets is VASTLY lower than the demand for tickets. But Taylor, reasonably, doesn't want to be seen selling tickets for thousands of dollars each. Instead you get presales and lotteries and "ticketmaster fees" and a secondary market.

Re: Ask HN: Why is it so hard to disrupt Ticketmaster?

#60

Post by jnac » Thu, Nov 17, 2022, 4:12 PM UTC

bombcar wrote: post #42

Let's see. LYV is the parent company (including venues, etc). They are worth $16 billion (or about 1/4th an Elontwitter). They had revenue of $6 billion and made a EBITDA of $573m. So disruption of the Ticketmaster monopoly is going to result in $500 million? Perhaps? They don't seem to be printing money as much as everything thinks they are. Someone could buy LYV and show people how you really milk a market to death…

That's a good data point, the market is surprisingly small which could account for lack of competition. But the last annual report has the ticketing org alone at 37% EBITDA margin [1] (they call it AOI). No expert on benchmarking this # but wouldn't say they're not milking it.

[1] https://d1io3yog0oux5.cloudfront.net/_6fc34851c72a6087b32b93... p47