The consumer qualm with TicketMaster.

In the realm of live event management, one of the necessary steps taken is to create and distribute tickets for each unique event. These tickets provide proof of purchase and admittance to the event. The tickets can be distributed at the venue box office, online or by phone.  Venue and promotion companies can also hire third party companies to sell and distribute their tickets. In some cases, the business comes to them.

With the development of computers and technology, Ticketmaster changed the way tickets were priced and distributed. In pioneering a scaled pricing system, Ticketmaster created new competition. Customers can choose where they want to sit. The closer the ticket was to the stage increased the price of the ticket. Ticketmaster had turned the tables on live events and created demand in a pre-existing business model.

As a side note though, Ticketmaster is known for buying exclusive rights to ticket services from venues. Selling itself as an exclusive ticket distributor, Ticketmaster holds tickets to over 9000 venues with sole distribution rights. With these exclusive rights being granted, majority share of belongs to Ticketmaster, which creates an unusual, legal monopoly for the industry.

Ticketmaster, without a doubt, is the foremost name in live events. Customers, with little alternative, purchased 141 million tickets in 2008. When a virtual monopoly exists, prices can be altered without justification. In the case of Schlesinger et al. v. Ticketmaster, two concert goers felt violated by Ticketmaster for their “illegal overcharging” of UPS delivery fees and Order Processing charges.

The plaintiffs charged Ticketmaster for fraudulent and deceptive business practices for their hidden and misleading fees for over ten years. In the purchasing process, Ticketmaster claimed charges for UPS delivery and Order Processing charges. In reality, those charges were discovered to be mere profit drivers for Ticketmaster. UPS and Ticketmaster had an agreement where UPS charges a reduced amount to Ticketmaster since UPS is the exclusive shipment company.

The result of the class action suit offers credits that are to be used towards future ticket purchases. It’s been debated if the retribution to the customers is enough for ten years of over charging. Since the allegations, some customers turned their backs on Ticketmaster and the shows they endorse. 

Source

Freeman, K. (Oct. 19 2011) Schlesinger et al. v. Ticketmaster, Superior Court of the State of California for the county of Los Angeles, Stanley Mosk Courthouse, Retrieval date: February 19^th, 2012 http://ticketfeelitigation.com/docs/Motion_for_Preliminary_Approval.pdf