The late 1990s and early 2000s saw the emergence of online ticket brokering as a lucrative business. Corporate ticket reselling firm Ticketmaster developed a strong online presence, dominating the online market. But by 2006 Ticketmaster's stranglehold on the industy loosened with the emergence of other online ticket brokering companies, such as StubHub who won Major League Baseball's ticket resale business over Ticketmaster.
Securities analyst Joe Bonner, who tracks Ticketmaster's parent company New York-based IAC/InterActiveCorp, told USA Today: "You have to look at the secondary market as something that is a real threat to Ticketmaster. They missed the boat. StubHub has been around a few years now already. They weren't as proactive as they probably should have been."
Eric Baker, founder and CEO of Viagogo.com, a European ticket resale Web site has described the loosening of Ticketmaster's grip on the market as "the equivalent in the ticketing industry of the fall of the Roman Empire".
By 2008 Internet ticket fraud had emerged as global problem, when fake ticket websites defrauded millions of dollars from sports fans by selling Beijing Olympics tickets which they had no intention of delivering.
Due to the success of the secondary sale of tickets on the web, the line between ‘official’ (primary) ticket sellers and online ticket brokers (secondary sellers) has blurred. The two are now competing directly on a relatively level playing field: the internet.
Signs of the new, mature online ticket business are cropping up.
Consultancy and training firms are increasingly focusing on this ‘cleaning up’ trend. Events such as Ticket Summit 2008 in the US, held by the Better Ticketing Association, are becoming more and more common. A look at the programme for this congress gives a good idea of the key indicators on the agenda of ‘professionalising’ online ticket brokering. Topics include: ‘Getting Legal’, ‘Media Relations’ and ‘Building Your Base: The Lost Art of Customer Service’. There are similar conferences in the UK, such as the ‘Ticket Touting: Going, Going…Gone?’ conference held in London on 19 March 2008. Live UK Summit is another event that draws together ticketing agencies and other sectors involved in the live entertainment industry together in an open discussion forum.
Another sign of change is the increasing legitimisation of the internet as a free market environment for entrepreneurs. Many states in the US are repealing laws against ticket reselling. Five states have made the resale of tickets legal in 2007, with a Missouri senator stating, ‘It makes no sense that we would turn people into criminals for simply wanting to resell a ticket […].’
While the internet is becoming an increasingly safer place to shop, it is still not the place for the overly-cautious buyer. Online ticket brokering is legal in most countries, such as the UK and other European countries, and it is a profitable business venture. Venue owners and secondary ticket sellers debated this issue at the ‘Ticket Touting: Going, Going…Gone?’ conference held in London on 19 March 2008, concluding that, for the time being, ticket resale is a legal and acceptable practice in the UK. This seems to suggest that ticket reselling is increasingly ‘above board’, forcing online brokers to promise their customers the same service expected from primary sellers. This overall sea change presents a real challenge to corporate strongholds and is forcing sellers on both sides to try new things.
Online ticketing’s emergence, difficulties and subsequent growth can be best understood as showing the more general trends found in any new web-based market. First, there is a ‘Wild West’ style boom, with companies opening websites without a vision of long-term commitment, looking more to make an initial profit with a ‘take the money and run’ attitude. What now seems to be happening in online ticketing is that a handful of those initial start-ups are maturing into ‘real’ businesses with all the sensibilities and concerns of their cousins in the real (non-web) world through re-branding and optimisation of their enterprise.
Perhaps the best way to understand where the secondary ticket selling market is going and where it has been is to compare it to the book market online. It began with Amazon’s success as a primary supplier, supplementing direct sales with a secondhand book marketplace where sellers and buyers exchanged books. Today a number of websites like AbeBooks have appeared and optimised the marketplace idea, dropping the direct sales focus. In sum, the sale of secondhand books online has grown into it’s own as consumer-to-consumer exchange, leaving the web-based company host to online marketers.
This seems to be just what online ticket resale is doing.
Online ticket exchanges and marketplaces have taken over from the direct sale model as the ‘you order / we send’ interface has proven problematic and ineffectual. This departure has opened online ticket brokering up to the world of social marketing and the online community as a cultural space. Ticketing sites will provide blogs, forums, RSS, video and other media beside the events listed on their marketplace. This changes the feel of a site from being a purely commercial place to more of a meeting place for fans. It seems that for sites like The Online Ticket Exchange, SeatWave.com, See Tickets, Skelper.nl (Netherlands), Soldouteventtickets.com or viagogo.co.uk, this has been an effective strategy for winning consumer trust.
The way the ticket exchange model works is by allowing people with extra tickets to sell them on to those people who want them. The company plays the role of mediator, guaranteeing delivery of tickets, ensuring against fraudulence and creatively updating their website.