Ticketmaster is one of the most well-known and widely used ticket sales and distribution companies in the world. However, it is also one of the most hated. Complaints about high fees, lack of transparency, and anti-competitive practices have dogged Ticketmaster for years. Yet the company continues to sell tickets for many major concerts, shows, and sporting events. So why does Ticketmaster maintain such a dominant position in the ticket sales market despite the constant criticism? There are a few key factors that help explain why Ticketmaster remains such a major player.
Established Network Effects
Ticketmaster has been selling tickets since the 1970s. Over nearly 50 years, it has built strong relationships with venues, promoters, bands, and leagues across North America. As the established ticketing service for so many parties, Ticketmaster benefits from a powerful network effect. Fans go to Ticketmaster because it offers tickets to the events they want to attend. And venues, promoters, and acts use Ticketmaster because that’s where the fans are.
This self-reinforcing cycle makes it very hard for any newcomer to displace Ticketmaster. Attempts by competitors like AEG and Eventbrite to break Ticketmaster’s hold in various markets have largely failed. The sheer scale and breadth of Ticketmaster’s existing network gives it a nearly insurmountable advantage. Most fans and venues don’t want the hassle of using different ticketing services for different events. As long as Ticketmaster offers the most options in one place, consumers and partners have little incentive to look elsewhere.
Aggressive Mergers and Acquisitions Strategy
When potential rivals have emerged that could erode its position, Ticketmaster has frequently used mergers and acquisitions to expand its reach. In 2010, it merged with Live Nation to become the world’s largest live events and ticketing company. That combined the top ticketing service with the top concert promoter, instantly giving the new entity even greater dominance over the live music business.
More recently, Ticketmaster acquired Universe, a smaller ticketing service that had partnerships with major festivals and venues. That move eliminated a potential future competitor. Ticketmaster has the financial resources and industry clout to keep buying up whatever promising upstarts arise before they can grow into true threats.
Partnerships with Pro Sports Leagues
Sports ticketing is even more concentrated than concert ticketing, with Ticketmaster partnered with the NFL, NBA, MLB, and NHL. This exclusive arrangement blocks competitors from selling tickets to most major sporting events. It also allows Ticketmaster to bundle sports ticket sales with music events to create an even more imposing portfolio.
Sports ticketing also tends to be more price inelastic than concerts, since hardcore fans will pay almost anything to see their favorite team in person. That enables greater exploitation of service and processing fees. As long as Ticketmaster maintains its iron grip on sports ticketing, it has a dependable cash cow even if its music clients defect.
Leveraging Artist Relationships
Ticketmaster works aggressively to foster close relationships with managers, promoters, and performers. The company provides fan analytics to help artists plan tours, maximizing potential revenue. Ticketmaster also offers large signing bonuses and revenue guarantees to lock down exclusive ticketing deals, shutting out competitors.
Though fans may want more options, Ticketmaster works hard to ensure the people putting on shows work hand-in-hand with them. That artist loyalty remains a huge asset. As long as Ticketmaster makes concert promoters and managers happy with lucrative deals, they will keep utilizing Ticketmaster’s sales platform.
Industry Contacts and Political Lobbying
Ticketmaster maintains close ties to promoters like Live Nation and AEG. It also works hard to lobby politicians, emphasizing that mandatory concert ticket fee caps could reduce funds for venues. Cultivating insider relationships across the live music business and pressing its case in Congress and state legislatures helps Ticketmaster preserve its business model.
Anti-trust action against Ticketmaster has failed in the past in part because few politicians want to be seen as enemies of the concerts and sports that fans love. Ticketmaster’s deep industry ties and lobbying influence help it sustain policies favorable to its continued dominance.
Lack of Universal Outrage
Though fees and service charges frustrate many customers, not everyone detests Ticketmaster. Casual concert-goers who just want to easily buy tickets may not care that much about fees, as long as they can get seats. Hardcore fans are more outraged, but they will still keep using Ticketmaster rather than miss a favorite band’s show.
Since the anger is not universal, Ticketmaster avoids the level of public animus and political attention needed to potentially break up its business model. As long as a sizable portion of customers tolerates the fees in exchange for convenience, the pressure for drastic reforms remains limited.
Predatory Pricing and Product Tying
In markets where Ticketmaster does face competition, it can use predatory pricing and product tying to undermine rivals. The company may take losses by cutting fees to underprice competitors until they go out of business.
Ticketmaster can then absorb the losses due to profits in its captive markets elsewhere. Tying ticketing access for popular shows to less popular events also forces vendors to use Ticketmaster or else miss out on potential revenue. These tactics help maintain regional dominance.
Ticketmaster’s Biggest Advantages
Here are the key factors that allow Ticketmaster to remain in business despite poor public perception:
1. Network effects from its longstanding dominance
Ticketmaster has sold so many tickets to so many shows for so long that it has become the default ticketing service for many venues, artists, and fans. New entrants struggle to replicate its scale and connections.
2. Aggressive mergers and acquisitions strategy
Any promising competitors get bought out and absorbed by Ticketmaster before they can grow too large. The 2010 Live Nation merger especially increased Ticketmaster’s power.
3. Long-term partnerships with major sports leagues
Exclusive deals with the NFL, NBA, NHL, and MLB lock down lucrative sports ticketing revenue and reinforce Ticketmaster’s overall position.
4. Strong relationships with artists, promoters, and managers
Lucrative offers lead most bands, venues, and promoters to do business with Ticketmaster, even if they dislike the fees.
5. Industry connections and political lobbying
Ticketmaster utilizes close industry ties and lobbying to head off threats of regulation and antitrust enforcement.
6. Lack of sufficient public outrage
Though many despise Ticketmaster, the anger is not yet widespread enough to force major policy changes.
7. Predatory pricing and product tying where needed
In regional markets with competition, Ticketmaster can leverage profits earned elsewhere to underprice rivals until they fold.
Key Ticketmaster Advantages and Disadvantages
| Advantages | Disadvantages |
|---|---|
| Network effects from scale and longevity | Negative public perception of fees and lack of transparency |
| Acquisitions of competitors | Ongoing antitrust concerns and regulatory pressure |
| Sports league partnerships | Scrutiny over artist exclusive deals |
| Promoter and artist relationships | Class action lawsuits over pricing practices |
| Industry and political connections | Resentment from venues and artists over revenue splits |
How Consumer Behavior Enables Ticketmaster
Though fans complain loudly about Ticketmaster’s practices, certain behaviors keep them coming back:
Desire for convenience and one-stop shopping
Using a single service for all events, even at higher prices, is easier for many casual fans.
Loyalty to favorite teams, artists, and events
Hardcore fans will endure almost anything to see their favorites in person.
Focus on access over cost for must-see events
For special experiences, high demand causes consumers to prioritize securing tickets over saving money.
Lack of viable alternatives in many markets
Regional dominance and exclusive partnerships limit options, forcing acceptance of Ticketmaster.
Unwillingness to miss out based on principles
Despite detesting fees, most fans would rather attend an event than boycott Ticketmaster altogether.
Weak consumer willpower against psychological manipulation
Tactics like initially low ticket prices and time-pressure countdowns lead fans to overspend.
Limitedconsumer organization to force change
Isolated griping does not pack the punch of organized boycotts and sustained political pressure.
The Future of Ticketmaster
Ticketmaster’s dominance clearly frustrates consumers and faces ongoing challenges from new technologies and competitors. But its demise is far from guaranteed. Here are some possible factors that will shape its future:
Increasing public anger reaches tipping point
If fees and lack of options finally outrage a critical mass of fans, regulators may be forced to act. But that anger point has not yet been reached.
Legal problems over exclusivity deals and pricing
Continuing investigations and lawsuits surrounding anti-competitive practices may unsettle key artist and promoter relationships.
Competitors gain foothold through new sales platforms
Innovative distribution options like direct artist sales through apps and NFTs could erode Ticketmaster’s grip. But the company is also exploring new technologies itself.
Rising consumer demand for fairer prices and fees
Younger generations especially are focused on equity, transparency, and fighting monopolies. Their expectations could shape the industry over time. But they also lack the spending power of older generations for now.
Unforeseen merger, acquisition, or failure
The loss of a key partner or a major merger between competitors could quickly alter the landscape. But Ticketmaster will work aggressively to prevent such shakeups.
Barring an unexpected shift, Ticketmaster’s entrenched advantages appear likely to preserve its incumbent status for years to come. Disrupting the ticketing giant would require a perfect storm of consumer outrage, political will, legal defeats, innovative competitors, and partners abandoning ship simultaneously. Piecemeal challenges have failed to dethrone Ticketmaster thus far. Unless multiple factors unite to undermine the company at once, it may frustrate customers indefinitely.
Conclusion
Ticketmaster has managed to maintain its position as the dominant player in ticketing despite years of complaints and controversies surrounding its fees and practices. Its advantages stem from substantial network effects, integration of key complements like major concert promoters and sports leagues, strong relationships with artists and their management, and significant political clout. Rivals have struggled to gain traction given Ticketmaster’s entrenched status across North America.
While consumers and venues continue to lament its pricing policies and lack of transparency, the convenience, breadth of options, and psychological tactics keep fans coming back. Some upstarts have managed to carve out niche roles, yet no single company has emerged as a full-scale rival to challenge Ticketmaster across multiple verticals.
Absent major coordinated action from consumers, politicians, regulators, artists, and competing companies, Ticketmaster looks poised to retain its commanding market share. Significant technology shifts or additional anti-competitive legal actions could potentially shake up the status quo. But the ticketing giant has proven adept at acquiring new capabilities and fending off previous lawsuits and regulatory threats. With no major threats emerging on the immediate horizon, consumers should expect to keep paying substantial fees for coveted tickets. While hope for greater choices, transparency and pricing fairness persists, Ticketmaster remains firmly seated on its ticketing throne for now.
