The money Ticketmaster loans or gives to arenas or promoters to meet guarantees is money spent to insure that the show will be performed. Several recent lawsuits call Ticketmaster dividends to venues ‘kickbacks.”‘ Ticketmaster, in other words, is securing long-term arrangements. … Ticketmaster has even loaned promoters money to meet the guarantees of stadium acts and has given money to venues for promotion and marketing…. The article goes on: “One reason these surcharges are so high is because Ticketmaster pays a small fee to venues or promoters for every ticket sold in order to maintain its exclusive contracts with them. The error, known to economists as the “physical fallacy,” is examined below. The service charges that Ticketmaster adds to tickets range from $3 to $6 and can add more than 30 percent to a ticket’s face value.” The suggestion here, that Ticketmaster’s activities make fans worse off, involves an economic fallacy. This is often at the expense of fans, however.
What are these “anti-competitive” practices? The Rolling Stone article by Neil Strauss and Tom Dunkel provides some examples: “Ticketmaster, it’s claimed, keeps ticket sales organized and revenue high. Understanding this is vital to understand the “anti-competitive” practices that Pearl Jam’s suit hopes to stop. In other words, the survivors will be the ones who make the best business decisions. In ticketing, as in any contested market, the companies (or company) that survive will be the ones who best cut costs, find new markets, and plan long-term. Why would Ticketron lose millions of dollars a year, while Ticketmaster turned a profit? Ticketron must have operated less efficiently. Ticketmaster had competition, but its rivals could not manage to compete.Īccording to Rolling Stone magazine, Ticketron, the largest competing ticket service, sold out to Ticketmaster in 1991, after losing millions of dollars a year from 1988 on. Does Ticketmaster have a similar monopoly on tickets? No. Pearl Jam has a legal monopoly on any songs and performances they create, as they should. Department of Justice on May 6, 1994, Pearl Jam asserted that Ticketmaster has a “virtually absolute monopoly on the distribution of tickets to concerts.” What constitutes a “virtually absolute” monopoly? Patent law creates monopolies (single seller positions) in inventions and innovations copyright confers monopolies in literary/artistic works. In a memorandum filed with the Antitrust Division of the U.S. What is the truth of the matter? To find out, let’s look at some of the charges against Ticketmaster in the context of antitrust laws. “ According to Pearl Jam, Ticketmaster is intending to monopolize the ticket service industry. Time magazine has called the legal battle “Rock ‘n’ Roll’s Holy War.
The lawsuit initiated last spring by the rock band Pearl Jam against Ticketmaster has once again brought antitrust laws into the limelight. Bilodeau received a bachelor of science in geography from Florida State University in 1992.
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