Ticketmaster is one of the largest ticket sales and distribution companies in the world. Founded in 1976, Ticketmaster has grown to dominate the ticket sales industry, especially in North America. The company sells tickets for concert, sporting and theater events on behalf of clients across its global network of websites, apps and retail outlets. Ticketmaster is a subsidary of Live Nation Entertainment, the world’s largest live entertainment company.
The History of Ticketmaster
Ticketmaster was founded in Phoenix, Arizona in 1976 by two computer programmers, Gordon Gunn and Peter Gadwa. The company was established to provide ticket sales services utilizing computerized systems. In its early years, Ticketmaster focused on selling tickets for local venues in Arizona like the Phoenix Suns basketball team.
By 1982, Ticketmaster began expanding nationally, providing ticketing services for major concerts and sporting events across the United States. Through the 1980s and 90s, Ticketmaster purchased several of its competitors to grow its market share and signed exclusive agreements with major venues and promoters. This allowed the company to secure exclusive ticketing rights for many of the top venues and live events across North America.
Some key events and milestones in Ticketmaster’s growth:
1982
– Ticketmaster sells its first NFL tickets for the Seattle Seahawks
1991
– Ticketmaster is named the exclusive ticket service for the NCAA Final Four basketball tournament
1993
– Ticketmaster.com website is launched
1995-96
– Ticketmaster begins selling tickets online and over the phone using call centers
1996
– Ticketmaster acquires its largest competitor, Ticketron
1998
– Ticketmaster sells 125 million tickets, valued at over $4 billion dollars
2007
– Ticketmaster sells 140 million tickets, generating $8 billion in sales
Ticketmaster’s Merger with Live Nation
In January 2009, Ticketmaster announced plans to merge with Live Nation in a deal valued at $2.5 billion. Live Nation was the largest concert promoter in the world while Ticketmaster led ticketing services. Together, the merged company called Live Nation Entertainment became a global live events powerhouse.
The Live Nation-Ticketmaster merger brought together the leading companies across concert promotion, venue operations, ticketing, sponsorship and artist management. While initially viewed as anticompetitive by some regulators, the merger ultimately passed regulatory scrutiny and was finalized in January 2010.
Here are some key details of the Live Nation-Ticketmaster merger:
| Year | Key Event |
|---|---|
| 2009 | Merger deal announced valuing Ticketmaster at $2.5 billion |
| 2009 | Deal receives initial regulatory scrutiny over monopoly concerns |
| 2010 | Merger approved by regulators after Live Nation agrees to license its ticketing software |
| 2010 | Merger finalized – Live Nation Entertainment formed |
With the merger complete, Ticketmaster became a wholly owned subsidiary of Live Nation Entertainment. Although it continues to operate under the Ticketmaster name, it is officially part of Live Nation’s portfolio of brands and companies.
How the Merger Impacted Ticketmaster
The Ticketmaster-Live Nation merger created a number of synergies and benefits that have helped Ticketmaster continue to grow and innovate over the past decade:
Greater resources for technology and innovation
With Live Nation’s backing, Ticketmaster has invested heavily in improving its website, mobile apps and digital ticketing technology like paperless ticketing. For instance, in 2017 Ticketmaster launched its Presence mobile ticketing technology which allows contactless entry for events using a mobile device.
Expanded inventory of tickets
With Live Nation being the world’s largest concert and live events promoter, Ticketmaster has exclusive rights to sell tickets for many of the top concerts, festivals and tours from top artists. This greater access to premium ticket inventory helps drive revenues.
Cross-promotion opportunities
The merged company can cross-promote tours, festivals and live events across its Ticketmaster, Live Nation and other ticketing platforms. This allows Ticketmaster to market ticket sales more effectively to consumers.
Greater data and analytics
With Live Nation’s first-hand data on concert attendance, ticket sales and customer preferences, Ticketmaster can improve its ticketing analytics, recommendations and targeting.
Stronger foothold in fast-growing resale market
In partnership with Live Nation, Ticketmaster has expanded significantly into the live event resale market through its Ticketmaster Resale and Ticket Exchange platforms. Fans can resell Live Nation event tickets directly through Ticketmaster’s site.
So in many ways, the merger with Live Nation helped solidify Ticketmaster’s dominance in ticketing and live events by combining complementary capabilities under one roof. Despite some ongoing complaints about high fees, Ticketmaster continues to sell hundreds of millions of tickets per year.
Ticketmaster Business Model
Ticketmaster operates on an agency model, serving as an intermediary between event organizers and ticket buyers. Here are some key components of Ticketmaster’s business model:
Primary ticket sales
Ticketmaster’s core business is selling primary tickets to live sports, music and theater events on behalf of its promoter and venue clients. This makes up the majority of its ticketing revenues.
Service fees from ticket buyers
On primary ticket sales, Ticketmaster collects fees and charges from ticket purchasers as its main revenue stream. These can include order processing fees, delivery fees, and other charges that are added onto the base ticket price.
Commissions from event organizers
For its services, Ticketmaster also earns commissions from promoters, producers, teams or venues who organize the events and own the tickets. This commission is a percentage of either the base ticket price or total convenience charges.
Reseller ticketing
Ticketmaster operates one of the largest ticket resale marketplaces enabling fans to resell event tickets through its Ticketmaster Resale and Ticket Exchange platforms. The company earns a commission on every resold ticket.
Advertising and sponsorship
Ticketmaster also generates revenues by selling sponsorships and through advertising placements across its platforms. Promoters can pay for premium placement when listings events.
This multi-pronged approach has allowed Ticketmaster to become highly profitable. Critics argue that Ticketmaster’s fees are too high but fans keep coming back due to the convenience and selection its ticketing platforms provide.
Ticketmaster Market Share
Thanks to its early mover advantage, acquisitions, exclusive deals, and merger with Live Nation, Ticketmaster maintains a dominant position in the primary and secondary event ticketing market.
Here are some estimates of Ticketmaster’s current market share:
Primary ticket sales
– 70-80% market share of primary ticketing for major concerts and live events in North America
– Processes 500+ million ticket sales per year across all events
– Provides ticketing services for 500+ big venues and promoters globally
Secondary ticket sales
– 60%+ market share of secondary ticket reseller market
– Ticketmaster Resale and Ticketmaster Exchange see over 100 million ticket resales per year
No other primary ticketing company comes close to matching Ticketmaster’s reach, client roster and ticket sales volumes. Its closest competitors include:
– AXS – owns and operates digital ticketing platform AXS.com
– eTix – provides customized digital ticketing services for venues
– Eventbrite – An independent DIY-focused ticketing platform popular with smaller promoters
But when it comes to ticketing for major concerts, sports leagues, and Broadway shows, Ticketmaster remains the dominant go-to resource. It has maintained its leadership status by continue to innovate its technology and expanding client services.
Ticketmaster Company Financials
As a division of Live Nation Entertainment, Ticketmaster does not report its financials directly as an independent company any longer. However, Ticktemaster’s revenues and profits make up a significant portion of Live Nation’s overall business.
In 2021, Live Nation generated total revenues of $6.26 billion. Out of this, $1.49 billion came directly from Ticketmaster operations which encompasses primary and secondary ticketing services.
Here is a summary of some key recent financial results for Live Nation which include major contributions from its Ticketmaster division:
| Live Nation Financials | 2018 | 2019 | 2020 | 2021 |
|---|---|---|---|---|
| Revenue | $10.79 billion | $11.55 billion | $1.86 billion | $6.26 billion |
| Operating Income | $432 million | $426 million | (-$1.7 billion) | $328 million |
| Net Income | $68 million | $69 million | (-$1.6 billion) | (-$1.02 billion) |
A few things to note from Live Nation’s recent financial performance:
– The company saw declines in 2020 due to the COVID-19 pandemic shutting down live events and ticket sales.
– But revenues and profits rebounded sharply in 2021 as live events resumed.
– Ticketmaster contributes around 25% directly to Live Nation’s total revenues.
– Live Nation’s overall revenue mix is now more diversified across ticketing, live events promotion, sponsorships, advertising and artist management.
Despite some ongoing complaints about its fees and competitive practices, Ticketmaster remains a key profit driver and one of the most important divisions under the Live Nation umbrella of brands and subsidiaries.
Conclusion
In summary, Ticketmaster is a subsidiary of Live Nation Entertainment, the world’s largest live entertainment and ticketing company. Formed in 1976, Ticketmaster grew to become the dominant primary event ticketing platform through acquisitions, exclusive deals and later its 2010 merger with Live Nation.
Although it faces some competitive and regulatory pressure, Ticketmaster continues to sell several hundred million tickets per year across Live Nation’s global roster of concerts, festivals, sporting events and venues. Ticketmaster’s business is highly profitable thanks to service fees charged on ticket purchasers and commissions earned from event organizers. Going forward, Ticketmaster is focused on improving its digital ticketing technology and analytics to cement its leadership in the live entertainment space.
