Ticketmaster Sues Competitors For... Well, Being Competitors

from the we're-so-used-to-being-a-monopoly,-we-should-sue! dept

Fri, Apr 20th 2007 8:17am — Mike Masnick

Last year, we noted that Ticketmaster, who for years has based its business model on being a monopoly provider of event tickets, was so upset at the growing number of web-based competitors for reselling tickets that it was pushing for laws to make selling tickets above face value illegal in an effort to stop sites (or users of sites) like StubHub (an eBay subsidiary) and Craigslist from selling tickets. Apparently, the company also has a second plan: sue the competition. The company has sued StubHub for selling tickets to concerts where Ticketmaster claims it was supposed to be the "exclusive" ticket provider. The company claims it had signed contracts with certain venues to guarantee exclusivity. However, StubHub was (according to Ticketmaster) still able to get tickets to these venues by threatening that they "might not be considered as venues for future live-entertainment events." It's not clear why Ticketmaster is suing StubHub, however. If the venues broke a contract, why isn't Ticketmaster suing the venue? StubHub never signed an exclusivity contract with Ticketmaster. Also, StubHub seems to be selling the tickets at three to four times as much as Ticketmaster is selling the tickets, so it's not like people are likely to go to StubHub instead of Ticketmaster for those tickets.

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35 Comments

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Aaron, 20 Apr 2007 @ 8:43am

Why sue StubHub?
If StubHub threatened venues with which Ticketmaster had exclusive contracts it's called "Incitement to Breach". A third party who knowingly entices a person or organization to breach a contract they've signed can be liable for damages. If you've had a contract broken and legally have the option of suing A) An important supplier or B) A competitor for damages, who would you sue.
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Jacket, 20 Apr 2007 @ 9:14am

Re: Why sue StubHub?
But how do you know if they have an exclusivity contract. And just because the only competition out there is the only competition doesn't necessarily cut it in answering that...

Wouldn't plausible deniability be applicable in something like that?

Obviously up until the point where you were told: Hey! We have an exclusivity contract here! Stop that!

Up till that point, you're not inciting anything...and if you're simply re-selling the tickets you're not, so far anyway, breaking the law, let alone breaching a contract. Ticketmaster probably sold the re-sold tickets in the first place anyway...
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squik, 20 Apr 2007 @ 9:19am

The allegation appears to be
The allegation appears to be "intentional interference", though I agree that "incitement to breach" is apropos. The key point in this dispute seems to be the threat by StubHub against the venues to purposefully incite them to breach a contract.

The characterization of the suit "suing for being competitors" indicates the poster has a misunderstanding of tort law. If the details of the suit are as they are reported in other articles, then it Ticketmaster has a case. Let's see if it stands scrutiny.

For people interested in understanding the legal grounds for the case see:

http://www.lectlaw.com/def/i084.htm
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Andy, 20 Apr 2007 @ 9:31am

Exclusive agreements
I cannot be 100% certain about this, but I work for a European software company and was told that we are not allowed (no doubt under some EU competition law) to give exclusivity agreements to our resellers.

Let's face it, exclusivity = monopoly which is an anti-free trade, restrictive practice. And knowing how Ticketmaster operates with all their extra charges on top of the face-value of the tickets they sell, it is neither surprising that they want this nor desirable that they should have it!
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anonymous, 20 Apr 2007 @ 9:32am

Duh
For all those ticket vendors being sued for "prices above face value" why not sell the ticket at face value and have a hefty "service charge"? This way TicketMaster can't continue its monopolistic practices.
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Anonymous Coward, 20 Apr 2007 @ 9:38am

Unfortunately Ticketmaster is indeed allowed to sign exclusive contracts and has managed to do so and maintain a stranglehold on many venues for well over a decade. Several major artists, most notably Pearl Jam, have made multiple effort to find ways to circumvent Ticketmaster's monopoly hold on much of the industry and all legal attempts to free that hold have also failed to date.
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iRobata, 20 Apr 2007 @ 9:39am

how do we know...
that this isn't just publicity to hide the real truth? I personally think that ticketmaster opened and set the so called "competing businesses" all over the web, sells its tickets basically to itself under a different name in order to be able to jack up the price of each ticket and create super ridiculous profit, all while still keeping the Ticketmaster business model legal.

Well, at least that's what I would do.
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Anthony, 20 Apr 2007 @ 9:52am

If you think about it....
I don't see how Ticketmaster even sees these other guys as threats on their precious monopoly since most people only check these "legal" ticket scalpers once an event has sold out. Ticketmaster gets the bulk of the ticket sales upfront. I tried to be tickets to an Eric Clapton Crossroads event that sold out in 15 mins. After a host of errors with Ticketmaster (only displaying $1000.00 tickets for sale for the first five minutes after they went on sale online which they admitted to me was a mistake on their part), I had to turn to Stubhub and eBay to find my tickets at 2 and a half times their face value. If anything the government needs to step in and either eliminate "legal ticket scalping" or crush Ticketmasters "legal" monopoly.
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James, 20 Apr 2007 @ 10:00am

Can't believe...
... I'm going to agree with TicketBastard on something, but I am. This ticket scalping bs has simply go to stop. Tickets should not be purchasable above the original price (I'll concede 5% for a person's trouble).

That said, TicketBastard's "inconvenience" fee needs to be regulated because thats what happens to monopolies and apparently the market isn't stepping in to take care of them.

I sorely dislike having to do business with them at all.
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no live for me!, 20 Apr 2007 @ 10:07am

I don't even get what the big point is to join a HUGE crowd in on overstuffed cocnert hall, sweaty, with overpriced beverages to listne to music that is usually too loud while a bunch of people jump up and down on your toes.

I understant if you're teenager, but once you join the adult crowd, what's the point? I'd rather spend my money on some good CDs, downloadable content, and some awesome concert DVDs that I can enjoy over and over and over again.

Plus in all honesty, with channels such as Voom's HD concert channel it makes staying at home and enjoying my "low cost" beverage even more relaxing.
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Vincent Clement (profile), 20 Apr 2007 @ 10:23am

Re: Can't believe...
Tickets should not be purchasable above the original price

Why not? If I bought the ticket, I should be free to sell it for whatever price I am able to negotiate. After all, everybody else, from the venue to the artist to the ticket seller, earned their cut when I paid face value for that ticket. I'm not hurting their ability to earn money.
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Are you kidding?, 20 Apr 2007 @ 10:24am

That is how it works
You must understand that any venue could go to another ticket supplier when the contract was up. Or the venue could handle all of the aspects of selling tickets and do it themselves. There is no monopoly, Ticketmasters was contracted to do the job. Would you hire three different plumbing companies to come and fix your drain? How would you track all these different tickets coming from different companies. This is why only one company has the contract to handle selling tickets. Why ticketmaster is even concerned about this is beyond me. The tickets have to be bought from the venue box office or on the web. And if tickets are bought from the box office [no fee's going to ticketmasters] then put directly put onto Stub Hubs website for sale. At that point Ticketmaster could be losing out on revenue. All Stub Hub has done is created a platform to be the middle man and added some more convience fees. You're just getting screwed by these scalpers and you have to decide if its worth it.
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James, 20 Apr 2007 @ 10:39am

Re: Re: Can't believe...
Simple anyone with a brain can figure out that the tickets were offered at their original price so that people could go see the artist, production, et al. Not so that some third party could buy a % of prime seats and artificially inflate their price.

The people who work to make money off of the production by being in it (or associated) add value to it and deserve to earn a cut. If your kind actually offered some sort of additional value w/that artificially inflated price I might be more willing to see your side of the argument.

Otherwise you are just stealing $$ from a person who should simply tell you to enjoy the show, and stick your overpriced ticket up your %*&^@.
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Jacob Buck, 20 Apr 2007 @ 10:40am

Re: Re: Can't believe...
I'm not sure if this applies everywhere, but here in NY selling a ticket to an event for more than you paid for it is known as scalping and is illegal.
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A. Lloyd Flanagan, 20 Apr 2007 @ 10:45am

Re: That is how it works
>> You must understand that any venue could go to another ticket supplier when the contract was up.

Sorry, but that's simply incorrect. All competitors have been frozen out of the market; in the US it's effectively TicketMaster or at-the-door sales. See reply 6.
Our laws against antitrust are obviously waived for someone with a) good political connections, and b) no major competitor to push the DOJ to sue.
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C. R. Dick, 20 Apr 2007 @ 10:48am

Hahaha
Scalping is capitalism at its finest. Once I buy a ticket it is mine to do with what I please include sell it to you at an outrageous price. If you think the price is too outrageous, no one is forcing you to pay it. Concert tickets are not basic necessities like food housing and health care that need to be regulated for the greater good of society.

Why should we regulate the price of tickets? Just like real estate or a sweaty T-shirt once (allegedly) worn by a celebrity, these things are worth whatever people will pay for them.

What needs to be stopped is professional scalpers sucking up huge blocks of inventory creating an artificial scarcity and thus being able to set outrageous prices. The market is supposed to regulate prices by just refusing to buy stuff that costs too much. Why are event tickets an exception?

What I would love to see is scalpers sucking up boo-coo tickets as usual
and the public just flat out rebelling. Here's a sold out show and the only available tickets are online at scalpalacious prices. The ticket buying public just gets together and decides they are only willing to pay a 20% markup (or whatever). So they organize and wait for the scalpers to get nervous and bring the price down.
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andy, 20 Apr 2007 @ 11:13am

eff ticketbastard
no. ticketbastard needs to die... no matter what the costs and no matter who does it. $7.50 service charge on a $12 ticket? eff you ticketbastard.
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drez, 20 Apr 2007 @ 11:29am

Re: Re: Why sue StubHub?
.... because StubHub is legitimizing scalping. I'm all for helping joe average get rid of a ticket due to unforseen circumstances, but StubHub ain't that, no matter how much they try and make it seem like they're "for fans, by fans".
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Charles Griswold, 20 Apr 2007 @ 11:31am

Re: no live for me!
I don't even get what the big point is to join a HUGE crowd in on overstuffed cocnert hall, sweaty, with overpriced beverages to listne to music that is usually too loud while a bunch of people jump up and down on your toes.

I didn't understand the the appeal either, until I went to my first Ozzfest.
It's really hard to explain what makes it so great, you just have to experience it for yourself. If you live in an area that has concerts, I heartily recommend that you treat yourself to at least one concert in your life.

Of course, your objections apply mostly to rock (and maybe other popular) music. A celtic or classical music concert would be a completely different experience.
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Overcast, 20 Apr 2007 @ 11:36am

Tickets are worse than the RIAA's scam. I haven't bought any for years.....
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Charles Griswold, 20 Apr 2007 @ 11:39am

So the Upshot of All This . . .
It seems that what seems to be happening is that Ticketmaster is suing their competitors for . . . trying to be competitors. Oh, they may have a legal justification for suing, but that doesn't change their basic reason for doing so.
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James Weil, 20 Apr 2007 @ 11:44am

Ticketmaster Monopoly`
Ticketmaster legalized monopoly is the main reason I almost never attend entertainment events. It simply violates my values to support an organization that is so controlling, and has so much contempt for its customers as Ticketmaster. How they created their hostile control over the entire entertainment industry is now history.

Right now we have only two choices. Either live with it and their ludicrous legal maneuvers and service charges; or simply say no and avoid any venues sold by Ticketmaster until they crumble from lack of patronage. Simply stop buying tickets from Ticketmaster or scalpers that include ridiculous service fees and charges. Decide today that you will either purchase tickets at face value ( plus a nominal mailing fee - i.e. under a $1 for each ticket if applicable (nothing for download and print) or you will not attend the event. Eventually when enough people subscribe to this practice, both venues and performers will just say NO to Ticketmaster..

Instead they will start selling directly to the public. This is now very practical to do with the tools and availability of the Internet. Performers and venues no longer need to even print the tickets. All they need is a db and barcode software to manage seating, sales, and selection. Customers can now print their own tickets or receipts that can be matched to the db at the door.

Yes you may miss good entertainment. But it is only entertainment. Yes it will temporarily hurt performers and venues to some degree.

Yes the collapse of Ticketmaster may not occur during your lifetime. But you have to think of the long term consequences. You have to decide if you want your children to be slaves to the practices of Ticketmaster in order to enjoy live entertainment.

The time to act is now.

Venues and entertainers will survive, although not as comfortably as they do now. Continue to support them through DVD and other media sales instead of attending live performances at the mercy of Ticketmaster. Put your money into multimedia equipment instead of Ticketmaster coffers. The view is probably better and more convenient to attend anyway.

Yes you may miss the thrill and intimacy of a live performance. But it only has to be done until Ticketmaster crumbles. Ultimately your friends and children will be thanking you for thinking of them instead of yourself and immediate personal gratification.
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Adam, 20 Apr 2007 @ 12:04pm

side note
On a side note from teh article...

24mbps down and 2.5 up?

damn gina.

f*ck american broadband companies.

f*ck them in their silly a**es
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Chuck Norris' Enemy (deceased), 20 Apr 2007 @ 12:20pm

Face value
If they get laws making it illegal to sell tickets above face value, who is to say that Ticketmaster sets that value except for the fact that they are a monopoly. Bastards! I know Ticketmaster sells their tickets for more than they are worth adding service charges up the wahzoo.
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SM, 20 Apr 2007 @ 12:39pm

Face Value
I don't see why it should be illegal to sell a ticket for more than face value. I can buy a shirt for $20, then turn around and sell it to someone else for $40, right? There's no fraud involved (in theory) -- the actual retail price is printed right on the ticket, the buyer knows he's paying above the listed price, and the original seller, in this case Ticketmaster, already sold the ticket and therefore shouldn't have any say in what the original buyer does with it.
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Anonymous Coward, 20 Apr 2007 @ 2:42pm

If Ticketmaster wasn't a monopoly, it would have gone out of business years ago due to sheer incompetence and greed.

I pick out my concert online, enter payment info, and print an online ticket. I even speak to a human being and I still pay a service charge that can be as much as 25-305% of the actual ticket price?

I refuse to use Ticketmaster. If the band isn't playing at a venue that has its own box office, I'm not going.

Ticketmaster's service fees would be exorbitant even if they came with a happy ending...
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James, 20 Apr 2007 @ 2:53pm

Re: Face Value
Your analogy fails because t-shirts can be bought most anywhere, whereas concert and theatre tickets cannot.

I love capitalism and the free market but this is a case where it fails the consumer.........badly.
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Gene, 20 Apr 2007 @ 4:12pm

Re: Hahaha
Ahhh, so exactly how much inventory is ethically ok to have in your 'mine to do with as I please' universe?
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mindtrap, 21 Apr 2007 @ 5:18am

Re: Re: Re: Can't believe...
Scalping is also illegal in Toronto and probably the whole GTA.

But the only reason scalping is illegal I would think is due to possible forgery of tickets and selling those tickets for an absurd amount of money.
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ConcertHound, 21 Apr 2007 @ 3:58pm

This is not hard to understand, people
Selling tickets above face value is legal in almost every state and most of the remaining, like New York and Massachsetts, are about to eliminate their 1920's laws. Several states dropped their laws in just the past couple years. Buying and selling tickets is a huge business because fans are very willing to pay to get into sold out shows or get better than the crappy seats left after the tickets first go on sale. If there wasn't demand, there wouldn't be a market so stop acting like fans have a gun against their heads and are getting raped by those notorious boogeymen, the "scalpers"! This has nothing to do with contracts over BS auctions that represent .00000005% of ticket sales. Ticketmaster knows the resale market potential is huge and wants to take out their biggest competitor and own this business like they do the original distribution.
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RandyfromPA, 22 Apr 2007 @ 10:58am

Huh?
The original agreement seems to be between StubHub and the artist who gets some percentage of the tickets for their own use, e.g. see http://www.lynyrdskynyrd.com/ While all the pro and anti-scalping rants are entertainiing, what does this have to do with state laws or Ticketmaster other than everyone wants a piece of the action?
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Squiggy, 22 Apr 2007 @ 11:06am

It's just not that convenient!
Did anyone notice face value stopped representing the cost of acquiring tickets a long time ago? Convenience fees, shipping fees, email fees, fan club fees, primary seat license fees, waiting list fees, credit card and other annual fees that get you access to presales... Calls to control resale prices to x% or $x over face value are flawed to start with.
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Al, 30 Apr 2007 @ 8:32pm

FEES
TICKETMASTER IS FREAKING OUTRAGEOUS !! HAS TO BE SOMETHING WE CAN DO !!!! HELP !
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Lora, 17 Oct 2007 @ 11:24am

Ticketmaster suing
I find it ironic that most Canadian hockey teams websites ticketing is done through Ticketmaster and they promote the use of that teams PRIME SEAT CLUB, where season ticket holders can "scalp" their tickets for way more than face value. One game this year listed for the Canucks has tickets listed at 900% higher than the face. Is that not scalping??
And what about the auctions now available on Ticketmaster....
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doug, 13 Nov 2007 @ 3:24pm

Re: Why sue StubHub?
thats right i agree with you, does anyone realize that there are 3 TICKET BROKER ADS ON THIS SITE??? LOL
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