Much has been made of the recent Ticketmaster debacle for Taylor Swift’s upcoming concert series. In brief, Ticketmaster seemed to run out of tickets to sell to the general public after a pre-sale involving special codes was oversubscribed.
Now tickets have magically appeared on Ticketmaster’s secondary market, StubHub, at vastly inflated prices. As of Monday November 28, Ticketmaster doesn’t have any tickets for sale.
But a cursory survey of StubHub shows lots of tickets for sale, ranging from $569 CDN to $14,516 CDN.
Keep in mind that Ticketmaster ran out of tickets before the public sale. Now hundreds if not thousands of tickets are on sale on StubHub. To whom does the profit on these tickets go?
Well, if you control the distribution of tickets and have a bankable star named Taylor Swift, wouldn’t it just make good business sense to hold back as many tickets as you possibly can, put them on your resale site and make a killing?
I’m not saying that’s what Ticketmaster did. I’m just asking questions.
But there’s a very simple solution to this kind of graft.
There has been a movement in the creative world for the original artist to benefit from the resale of their artwork. “Artist resale rights” have been debated for years, where a small percentage of any subsequent resale goes back to the original artist or their estate. In the late 1970s, the state of California passed a law that entitles an artist to five percent of any resale.
More recently, this has been upped to 15%. Why shouldn’t the creator of a piece of art benefit from its resale? A Canadian artist, E.J. Hughes, created a now iconic image of a nautical steamer. He sold it for $150 in the 1950s. It recently sold for more than $800,000. Canadian artist resale rights law doesn’t exist, but in the creative community, it’s slowly gaining traction.
So, what does this have to do with Taylor Swift?
Taylor Swift is an artist. Her performance is her artwork. She is arguably the biggest star in pop music. She needs to write into her Live Nation (which merged with Ticketmaster in 2010) contracts that she retains the rights to every performance, and, in turn, the right to resell the ability to attend that performance.
Ticketmaster physically changes the electronic ticket when it is transferred. When Ticketmaster issues a ticket, it contains a bar code. When that ticket is transferred, the original bar code is stripped out and a new bar code is attached, rendering the original ticket useless. Anytime a ticket gets transferred and the barcode changed, a percentage of the money should immediately go to the artist, not the reseller. Say, 90%. Surely on a $600 resale, $60 should be enough to compensate Ticketmaster for facilitating the sale. I’m sure their $35-50 fee for ‘administration costs’ would also still apply.
This would do two things. It would eliminate the resale of tickets. With the up-front costs and a negative return, this should help keep ticket prices down. No one should be foolish enough to purchase a $200 ticket, try to sell it for $600 and only get $60 back for their trouble. Secondly, it should open up more tickets at the actual retail price since the incentive to inflate the prices is effectively removed.
People will still be able to transfer a ticket to a friend for free, and yes, there will be others that try a workaround with money transfers off Ticketmaster's ecosystem. And I can see reselling the ticket at face value with no penalty. Plans change and people should be able to pass their tickets along to someone else and not be out of pocket. I'm thinking the vast majority of scalping will simply disappear, though I'm probably misjudging people's penchant for avarice.
Instead of dumping the funds into Ticketmaster’s account, on transfer, the money should go to the artist. It’s a question of ownership and rights. Ticketmaster sells tickets. Live Nation hosts events. They’re not the performance. Why do they claim so much of the remuneration for the artist’s work? Without the artist, there’s no Ticketmaster or Live Nation.
I can already hear the arguments from Ticketmaster. “We enhance the audience experience by making tickets available in a safe, secure transaction.” Sure, to enhance Ticketmaster’s bottom line. “This kind of change would be impossible to program into our system.” Ha. Cellular phone companies bill by the minute and by the byte of data used. Ticketmaster can keep track of thousands of tickets at thousands of venues around the world. Programming their system for this would be a piece of cake. But they’ll never do it on their own.
Maybe someone like Taylor Swift can make this kind of change to the industry.
There's always interesting light in the fall.
