One of the biggest responsibilities and jobs for a manager in the music business is to keep the artist happy and their fans. They have to look at all aspects whether that is working on the business side or personal side of both parties. In this case we are looking at the business side of the new music economy . This article focuses on online music streaming websites, fans experiences with online ticket touting, and how much damage this has done to both the businesses and the fans.
Record labels have been transitioning and turning to online websites like Spotify and Apple Music to allow users to listen to music online. The outcome of these online sites have only been good thus far, and the users have such an open and wide access to music at such a small cost. But now the industry has to compete with other illegal websites that are streaming music, ultimately hurting that side of their economy.
Even though it only plays a small part, it does contribute to one big problem. Those websites play a similar role as to those second and third party ticket sellers.
Artists, record labels and publishers are being scammed out of their money from ticket resellers.
The main focus still is one thing: the fan. They are what keeps the music industry going.
For a band or artist, keeping your current fan base happy and trying to expand that group is the ultimate goal. Fans want the experience of seeing their favorite band at a live show for a more intimate and personal feel of the music. But when it comes to actually purchasing these tickets for concerts it becomes pretty difficult for the buyer due to ticket touts.
Ticket touts is another term used for scalpers, someone who are involved in reselling tickets for more than the face value of the ticket.
When tickets go on sale it has been shown that other sites like StubHub buy a large portion of the quantity of tickets that are actually being sold. So when the customer goes to buy those tickets, often time it gets sold out very quickly. Leaving them no other choice than to buy from resellers like StubHub who have raised prices.
StubHub is an online marketplace owned by eBay, which provides services for buyers and sellers of tickets for sports, concerts, theater and other live entertainment events.
The chart below shows how much StubHub has made in revenue
picture credits: musicbusinessworld.com
I have actually personally experienced this myself many time. For instance, one time one of my favorite bands announced that they were having a show in Los Angeles and that tickets would be going on sale on a Wednesday at 10 AM. So I got on my computer at 9:45 to make sure I wasn’t late on getting tickets, in fear of them selling out. So at 10, I was on their website, about to add tickets into my cart and before I knew it the tickets were sold out, within one minute. The face value of the tickets were listed at $45, but on StubHub they were listed for over $200. I decided to wait awhile in hopes that the prices would go down, but they didn’t. They just got higher. I ended up caving in and actually buying tickets for about $230.
These online ticket touts know that the consumers get desperate and ultimately give in and end up paying a ridiculous amount.
Some argue that this is “supply and demand in action.” But this whole system of buying and reselling tickets is just rigged.
In the article, they give a more specific example. It says “On Mumford & Sons last 16-date arena tour of the US in April 2016 we estimate that $3m went into the pockets of scalpers and secondary sites.” And all of that money taken from customers doesn’t even go back to the band or those promoting the concerts.
If that $3m “value gap” was created after a 3 week tour, I can’t even imagine how much money ticket touts make from artists on a year long tour.
At one of Mumfords’ shows they put 500 tickets at the door to be bought to disturb scalpers. Doing this was only a short term answer to solve the problem. But for long term, there isn’t one.
By McKenna Marchant
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