Computerized Ticketing (continued)

Now when you think about it – when you think about movies, movies are every 10 minutes from you. Who lives near a box office? I mean how many people live around the Forum? How many people live around Madison Square Garden? How many people live around the United Center, or the Rosemont Horizon? The dynamic was, that you bet you could create the system. You know, it was field of dreams – if you build it, they will come. And they did. And they would pay for the convenience, because here was the thought: if I drive to the box office, that’s an hour; and then I have to drive back, that’s an hour; and then I have to get online. Now if I go to my local outlet and I can get my local ticket center, and I can get those tickets, it’s 15 minutes from my house. I’ve got as good a shot because I’m [Ticketmaster] selling best available seat – everybody’s pulling from the same inventory – I got a better shot. And it worked. It really worked. In the sense that what we created by the mid 80s was a perception that if Ticketmaster didn’t sell the ticket, you were leaving money on the table.

We created basically a process that said: we make it really easy for the public to get tickets. Comes with a cost, but we make it really easy, and the public has a choice to go the box office if they choose. Which low and behold (which led a set of issues later on), was that no one went to the box office, which created the outcry of there’s no box office. But the fact is, the only person – at the end, the only people that ever went to the box office were the scalpers. Which was really pretty funny because that’s where they could line up and basically get tickets. But the dynamic was, the easier you made it, the more outlets you had, the more phone banks you had – you know, people could get through.

Scalping & The Value of a Show

The very essence of scalping is, which most music writers never got, is that a ticket’s a commodity. My favorite story about that is: there were five Springsteen shows in LA in the mid 80s, and tickets were $18. And we scrambled the first 10 rows of every show so that while we were selling – we didn’t sell front – we sold basically front to back from 11 on, and then you scram- maybe it was the first 20 shows – and then you know, 10 minutes into it you’d release row one, and then 20 minutes [into it, you’d release more seats], you know – so you would do that. And there were a bunch of scalpers out in the Valley standing there as we’ve all seen them. And this young girl walks out of the store (it was Music Plus), and she’s thrilled. She spent $18 and a $3 service charge, and there’s a guy standing there,

  • and he says, “Where are you sitting?”
  • And she goes, “Second row, third night” and she is really excited!
  • And he says, “I’ll give you $200. How many tickets do you have?” (she had four – four was the limit),
  • And he says, “I’ll give you $200 a ticket.” (We happened to have a spotter at this. We had spotters at different outlets so we know that this was a true story).
  • He says, “I’ll give you $200 a ticket.”
  • And she says, “No.”
  • And he says, “I’ll give you $500 a ticket.”
  • She says, “No.”
  • He says, “$600 a ticket.”
  • She says, “No.”
  • He says, “Young lady, $750 – my last and final offer. Yes or no?”
  • And she took the money.
  • She got $3,000, got back in line, and I’m sure she complained about paying the service charge, lol, but the reality is, that’s the business!

And what you see today is how that business has evolved because everybody’s in the ticket business today. I can’t tell you how many schools I’ve been to, where kids complained about service charges. And I said, “How many of you have put yourself through school by scalping tickets, or by reselling?” And you know, a quarter of the class’s hands go up. So it’s kind of funny, and kind of hypocritical. And it’s led to eBay, and it’s led to Stubhub, and it’s led to TicketsNow, and a whole host of basically resellers, because everybody’s back in the business.

Here’s the basic problem: in Broadway, a show will play as long as it can. And as long as it’s making money, it plays. The house is scaled, and that means there are tickets from $100 to $50 (or whatever it is), and it’s scaled. The problem with music is, it’s not that music isn’t scaled – nobody ever meets the demand. So the very essence of why tickets become the prices they do, is, the act isn’t sitting there for nine nights. The act is sitting there for one or two nights; maybe three nights; or maybe it’s a super act and it’s there for five nights. But the fact is, when you multiply that – take a metropolitan marketplace like Los Angeles, or New York; you’re talking about 20-30 million people in a 2-½ hour radius, and you’ve got 150,000 seats – and it’s a one-time event.

The thing about the live business is its immediacy. It’s something you want to touch; it’s an experience you want to share. When you go to a ball game, or you go to a concert, you talk to strangers. You go with a friend; you go with a date; you go with your spouse; you go with [whomever] it may be. You share that experience with them, and with strangers. If you went to a restaurant and said to somebody sitting across the [room], “How do you like that steak?” they might think you’ve lost your mind. But if you’re sitting with somebody that makes a great catch; or you know, you’re holding a lighter; or you’re swaying and you’re holding hands; there’s that remarkable emotional attachment that the live business has. And people fail to understand that there’s one basic principle to life – nobody ever paid more for a ticket then they wanted. This isn’t life, this isn’t housing – this is a business.

What you see with the artists is, as the artists have raised their prices and Golden Circles have come, and you’ve seen higher prices for tickets – the artist recognizes that they have a finite shelf life, and they have careers. If you called them a commodity, they’d get upset, and I don’t mean that, because they’re extremely talented, extraordinary people. They’re surrounded by business people who are managers and agents – who understand that people who participate in the secondary market don’t provide any value to them. So when they see these prices going off the charts, they say, Well maybe we should have a Golden Circle, or maybe we should charge more. I mean when Jerry Bus raised the prices on the floor seats to $500, they were his tickets. He thought he’d lose people. Nobody left. Is seeing a concert worth less than seeing the Lakers game, if you’re seeing a top-flight performer? I don’t think the answer is yes. I think they’re worth the same because it’s an experience. And so, that’s kind of the dynamic of it.

Golden Circle

I remember sitting in the early 80s with a bunch of promoters and everyone was very upset because the first row is $18 or $20, and the last row was $18 or $20. And then they couldn’t understand why people were buying tickets for $200 on the secondary market. And what the Golden Circle was saying was, Look, let’s take X number of seats and those are like loge seats (or orchestra seats) and lets price them and scale them. Basically, Golden Circle is like the beginning of scaling the house. You went from $5 concert tickets in the 70s (even $4 tickets in the 70s) up until the mid 80s because music was popular, and the people’s music – it was one price fits all. And that didn’t work, because the fans that bought them said, I paid $18, and now I can get $750? And the artists started to look at this and said, Maybe we should get some of this money.”

It’s a business, like anything else; you want to be fair to your fans. If you go to a baseball game, or you go to a Lakers game – the thing that Jerry Bus always did when I ran Ticketmaster, which was brilliant, was he had $500 [floor seats].then they became $1,000 floor seats. But he also had 500 or 1,000, or 2,000 seats up in the top that were $7.50 and $9.50. So listen, you can go. We get you in – and we’ll get you a cheap price, but it’s not going to be – it gets you in to share the experience. It’s not the best seat.

Music has come to that, and Broadway’s come to that too, because you saw $500 tickets for the Producers and they have what you call a Platinum Circle. It’s not surprising. And that’s because you have a lot of people who don’t want to stand in line; who don’t want to go through the hassle; and who want to get a ticket. So it’s never going to go away.

When I left Ticketmaster in ’98, prices hadn’t gotten to where they are now. Now the problem is that, because one act can get $150, another act thinks he can get $150. And the problem is not that people don’t want to go, they just don’t want to go and see that act at $150. Maybe at $60 or $50 they would. And the problem is not every act can draw that kind of money. So you know, that’s a different set of issues, but that was the beginning. That was when people started to think of this as, maybe it’s a business. Maybe it’s something we have to look at.

It used to be you made the record and toured to support the record, right? Now, you know, I think it was Madonna’s tour was $190 million dollars.