http://www.nytimes.com/2003/09/01/techn ... r=USERLAND
TIMES NEWS TRACKER
Ticketmaster Auction Will Let Highest Bidder Set Concert Prices
By CHRIS NELSON
Three years after Ticketmaster introduced ticketFast, its online print-at-home ticketing service, consumers have so embraced it that the company now sells a half-million home-printed tickets for sporting and entertainment events each month in North America. Where ticketFast is available, 30 percent of tickets sold are now printed at home, said the company, which is by far the nation's largest ticket agency.
But consumers — many of whom have complained for years about climbing ticket prices and Ticketmaster service charges — may be less eager for the next phase of Ticketmaster's Internet evolution.
Late this year the company plans to begin auctioning the best seats to concerts through ticketmaster.com.
With no official price ceiling on such tickets, Ticketmaster will be able to compete with brokers and scalpers for the highest price a market will bear.
"The tickets are worth what they're worth," said John Pleasants, Ticketmaster's president and chief executive. "If somebody wants to charge $50 for a ticket, but it's actually worth $1,000 on eBay, the ticket's worth $1,000. I think more and more, our clients — the promoters, the clients in the buildings and the bands themselves — are saying to themselves, `Maybe that money should be coming to me instead of Bob the Broker.' "
EBay has long been a busy marketplace for tickets auctioned by brokers and others. Late last week, for example, it had more than 22,000 listings for ticket sales.
Venue operators, promoters and performers will decide whether to participate in the Ticketmaster auctions, Mr. Pleasants said. In June, the company tested the system for the Lennox Lewis-Vitali Klitschko boxing match at the Staples Center in Los Angeles. The minimum bid for the package — two ringside seats, a boxing glove autographed by Mr. Lewis and access to workouts, among other features — was $3,000, and the top payer spent about $7,000, a Staples Center spokesman, Michael Roth, said.
Once the auction service goes live, Ticketmaster will receive flat fees or a percentage of the winning bids, to be decided with the operators of each event, said Sean Moriarty, Ticketmaster's executive vice president for products, technology and operations.
Along with home printing, auctions are central to "a new age of the ticket," Mr. Pleasants said. In the second quarter of this year, tickets sold online, with or without home printing, represented 51 percent of Ticketmaster's ticket sales. The rest were sold by phone or at walk-up locations.
Ticket Forwarding allows season ticket holders for several sports teams (including the New York Knicks, Rangers and Giants) to e-mail extra tickets to other users, with Ticketmaster charging the sender $1.95 per transaction.
TicketExchange provides a forum for season ticket holders to auction tickets online. The seller and buyer pay Ticketmaster 5 percent to 10 percent of the resale price, a fee the company splits with the team.
In the case of the ticketFast home-printing service, buyers pay an additional $1.75 to $2.50 per order, with the fee set by the event operator. Home printing has won converts among people who want tickets immediately, instead of receiving them by mail or a delivery service or having to stand in line at a will-call window.
One satisfied customer is Brian Resnik, 29, of Tampa, Fla., who says the home-printing fee is a bargain compared with the $19.50 that Ticketmaster charges for two-day shipping through United Parcel Service.
But some other users, who praised the convenience of home printing, objected to being charged an extra fee.
"It's kind of mind-boggling to me," said Joe Guckin, 41, of Philadelphia, who used ticketFast to buy tickets for a Baltimore Orioles home game last season. "You're printing up the ticket, on your printer at home, your paper, your ink, etc. — and you have to pay for that?"
The company replies that home-printing consumers are helping to pay for the technology that makes the service possible.
Ticketmaster has spent $15 million to $20 million to outfit almost 700 stadiums, arenas, theaters and concert halls in this country and Canada with bar-code scanners that read and authenticate the tickets and computers that capture information such as which seats are filled and which doors have the most traffic, Mr. Moriarty said. In 2003, the company has sold 400,000 to 600,000 ticketFast tickets each month.
Some ticketFast customers, like Diane DeRooy, 52, of Seattle, complain that Ticketmaster assesses a lot of fees even before levying the print-at-home charge. A ticket to see Crosby, Stills & Nash on Friday at the PNC Bank Arts Center in Holmdel, N.J., for example, carries $13.80 in venue, processing and convenience fees, plus a $2.50 charge for the home-printing option. Without the fees, a ticket costs $30.25 to $70.25.
Many of those customers are skeptical about Ticketmaster's plans to auction the best seats to concerts.
"The band's biggest fans ought to have the best seats, not the band's richest fans," said Tim Todd, 47, of Kansas City, Mo., who used ticketFast recently to buy tickets for a concert by the rock group Phish. Ticketmaster would be, in essence, official scalpers, Mr. Guckin said, voicing a sentiment expressed by some other customers.
Industry watchers agree that auctions will affect all concertgoers. Prime seats are undervalued in the marketplace, said Alan B. Krueger, a professor at Princeton University's Woodrow Wilson School of Public and International Affairs, who has studied ticket prices. He predicts that once auctions begin revealing a ticket's market value, prices as a whole will climb faster.
Gary Bongiovanni, editor of the concert industry trade magazine, Pollstar, predicted that all ticket prices would become more fluid. After a promoter assesses initial sales from an auction, remaining ticket prices could be raised or lowered to meet goals.
The notion of ticket auctions is annoying, Mr. Resnik said, but he is resigned to them.
"I guess the capitalist inside me would say, `Hey, if that's what they can get for tickets, I guess that's just something I can't afford, like a yacht and a Learjet.' "
