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MARCH 2012
McGowan’s
Musings
It’s getting busy again – in fact I’m so busy
Music Week in Toronto next week – March
Of course we all know that the gathering
I haven’t mentioned seagulls for ages – has
21, then Tallinn Music Week at the end of
togetherof people to enjoy live music, as
anybody noticed? Hands up – oh, a few of
the month, it’s a wonder that the News
evidencedby events like Live Aid, can produce
you then…and just as I mention this, Shitty,
gets done at all! But what would you all do
remarkably beneficial social effects. But it only
the most cross eyed seagull in Brighton
withoutit? – Don’t answer that!
really struck me last week whilst attendinga
landedon the flat roof and toppled sideways
Green Events and InnovationsConference
trying to hold one wing straight up – insolent
This year’s 24th edition of the International
which involved Greener Festivalsand the
bird! Anyway, now that’s out of my system
Live Music Conference (ILMC) sold out in
AIF event at London’s RoyalFestivalHall last
– busy! – yes, what with a very full on ILMC
advanceagain with a thousand live music week, - and I supposeI should have realised
last weekend, and preparations for Canadian
industry
COLOPHON > VIP-News is published by: VIP-Booking 145-157 St John Street London Ec1V 4PW Managing Director: Ronni Didriksen rd@vip-booking.com
delegates
from
61
this before - that so much can be learned from the efficientand environmentally
to put the business to rights and to enjoy
effectivepeople and resourcesmanagement
themselves. Some, especially those that took
of large scale festivalevents which can then
part in the football, at Wembley Stadium no
be applied to the betterhandling of large
less (!), returned home a little bruised and
gatherings of displacedpeople following
battered; the image of our very own Peter
natural disasters and the effects of war and
Briggs, hopping around painfully on one leg,
political unrest. One speaker from the floor
whilst declaring that playing on the hallowed
in panel called, ‘Water – The Stuff of Life,
turf was the best thing he’d ever done, will
mentionedworkingin camps set up for
stick in my mind for some time! What was
‘displacedpeople’ in Haiti really brought it
that? Oh, he tore his calf muscle – thanks for
home to me.
asking, he’ll be all right in a couple of weeks. Another aspect which became clear in that My experience, and this same view was
session was I hadn’t really considered, and
confirmedby others, was that this year’s
which highlights climate change, was that
ILMC (see report in this issue) had even more
we are now, this early in the year, officially
General Manager: Peter Briggs pb@vip-booking.com
of an international feel to it, with a wider
affected by drought in SE England, usually
range of people involved in the meetings ,
apart from the watering of lawns, this is not
Writer and editorial: Allan McGowan am@vip-booking.com
and a lot of newer delegates standing up to
usually a pressing problem, but it certainly
speak their piece – a very good thing! Both
is another weather problem which festival
the EmergingMarkets session and a Market
organiserswill have to take into account.
Writer: Manfred Tari mt@vip-booking.com For advertising enquiries please contact: Peter Briggs pb@vip-booking.com +44 870 755 0092
Focus on Chinahighlighted how things have progressed in many of the international So – I’m off to find thermal underwear as markets , and even how live music has
I’m told that it can drop to minus twenty
been and is still applied to the process of
in Toronto during Canadian Music Week, in
advocatingpeaceful communication in areas
the meantime – Ladies and Gentlemen – the
recovering from and in some cases currently
News…
beset by political and social unrest.
2
countries
descendingon London’s Royal Garden Hotel
VIP NEWS >
MARCH 2012
Green Events & Innovations Conference Allan McGowan am@vip-booking.com In the last couple of years attendance at the
project on the fortunes of the live industry in
International Live Music Conference (ILMC
the coming months. The session is modelled
24) has risen dramatically and according
on the famous UK TV humorous quiz show
to the organisers this year’s edition, again
“Have I Got News For You”.
held at London’s Royal Garden Hotel, looks
This year’s agenda will feature a look at
set to follow that trend which will mean
the Chinese Market, and the The Emerging
cappingthe numbers at a thousand plus and
Markets’ Place will compare the development
disappointingsome would be delegates. This
of the Eastern European Market with other
major live music industry event will take place
territories around the world. Also following
on 9th – 11th March.
the major problems caused at various outdoor events around the world last year two regular
For the second time the ILMC will commence
ILMC sessions The Booking Ring and The
with “The Open Forum” with Greg Parmley
Festival Forum will merge, to discuss the
welcoming guests, Emma Banks (CAA), John
production and promoter reactions to these
Reid (Live Nation), Wayne Forte (Entourage
catastrophes.
Talent, US) and Scott Rodger, manager of Arcade Fire, to review the past year and to 1
the development of the live industry, VIP News will attend and report back.
The ILMC is well known for breaking news and revealing opinions that directly influence
Anzeige_VIPMag_ProSky_X4.pdf
Ben Challis
09.12.10
More Details: www.ilmc.com
10:43
C
M
Y
CM
MY
CY
CMY
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VIP NEWS >
MARCH 2012
ILMC 24 Allan McGowan am@vip-booking.com
The 24th edition of the ILMC again sold
ILMC was also important as a place to make
out in advance, attracting more than 1000
and renew friendships, and how much it has
people and reaffirming the first word of the
even become a part of some people’s lives. It
event’s official title, International Live Music
certainly gave me personally a much-needed
Conference with attendance from no less
shot in the arm to keep going with what I’ve
than 61 countries gathering to discuss all
begun to call my ‘bastard child’, and plans
aspectsof the current state of the world’s live
for our big 25th anniversary edition are al-
music industry in the conference rooms, bars
ready well under way...”
and corridors of the Royal Garden Hotel in London.
Alongside the serious consideration of mattersranging from secondary ticketing
This year’s winners
ILMC Founder, Martin Hopewell gave VIP
– a burningtopic rekindled by a recent UK
News his view of this year’s edition:
Channel4 documentary (see report in this
First Venue to Come into Your Head
issue), to new technologies, emerged and
02 London, UK
“Although it’s probably true that I probably
emerging markets, event safety, venues,
only ever get to hear the positive feedback,
contracts etc, etc, ILMC, notwithstanding its
the general feeling I picked up was that ILMC
post-apocalyptic theme, always has it’s lighter
24 was one of the best meetings - if not the
moments and a full social agenda, including
best - that we’ve had so far. Certainly I was
football at Wembley Stadium. Certain ILMC
Most Professional Professional
struck by the energy this year - from the rapid
delegates have played on this hallowed
Martin Goebbels
pace of the registrations to the speed with
turf more oftenthan most professionaland
which the session rooms filled up. Everyone
international players!
seemed to be up for it. And there was a real
Services Above and Beyond Eat To The Beat
Liggers Favourite Festival Glastonbury
‘family’ feeling too - something of a return to
One event which started off as a light
Plumber of the Year
the meetings of the earliest years. Its always
hearteddig at the presentation of Awards –
Andy Franks
been true that the discussion topics are at
The Arthurs, has found itself being taken very
the heart of the ILMC, and this year was no
seriously by both the winners and music and
differentwith high levels of participation and
in many cases daily international press. This
information and an even greater spirit of
year’s winners were as follows:
openness - but this year reminded me that
Best in Show Cirque De Soleil: Alegria Least Painful Tour Roger Waters The People’s Assistant
Martin Hopewell
Sandra McCarthy – Live Nation Second Least Offensive Agent John Giddings The Promoters Promoter Barry Marshall New Boss Martin Nielsen (Live Nation Norway) The Bottle Award Willie Robertson
4
VIP NEWS >
MARCH 2012
ILMC 24 – The Conversion Proceeds Manfred Tari mt@vip-booking.com
Over the past three years or so the visitor profileof the annual live music business gatheringat the Royal Garden Hotel in London
Delegates at ILMC played football at Wembley, two of the players were Dick Molenaar and Claudio Trotta
seems to be gradually changing. The ILMC is getting younger while getting older. The rising number of new delegates, from different territoriesand new concert companiesis naturally stimulatingthe rejuvenation of this industry event. The ILMC 24 had its usual classic conference themes which were once again informative. However, while some conference topics in the past in particular have been controversially or even emotionally discussed, The ILMC 24 showed that some subjects were handled in a more factual manner instead of through
top shots and high potentials, but it is also
is often one of the more active sessions of the
the grand drama discussions that previously
a conference for the establishment of the
weekend, being run in round table fashion
entertainedand impressed delegates as
concert business overseas and the rest of the
and usually involving everyone in the room
industryheavyweights argued passionately in
world. The ILMC has its own identity with a
in active discussion on topics that are often
order to get their point of views across.
more intimate peer to peer characterthan
not chosen until everyone is in the room. The
most other music conferences in Europe .
idea is to elaborate on discussions from the
Good examples of these were ‘The Booking
While this issue is packed with articles
previousdays’ agenda and to pick up on topics
Ring’ chaired by Marc Lambelet from Black
referringto the subject of secondary ticketing,
that may have been overlooked. This year, not
Lamb, and the Tech Panel chaired by Ben
it was almost surprising to see that this topic
surprisingly, consideringthe recent impact of
Challisfrom Charming Music and Steve
played a less vital role than in previous years
the Channel 4 Dispatches TV documentary on
Machin from Stormcrowd. Many panels
even though The Great Ticket Swindle or
secondary ticketing (see report in this issue),
are getting more comprehensive, while still
SecondaryTicketing was covered to some
kicked off and remained on the subject of
deliveringfacts or news that retain The ILMC
degreein the opening session and popped up
ticketing. A lively debate followed involving
as what it’s known for, one of the two most
here and there during the conference.
panelists and as ever all in the room. There
important live music conferences in Europe.
was even a positive ongoing outcome of sorts
Yes Eurosonic is the other one and the main
The ILMC 24 had other more relevant
to the dealing with this thorny subject as Steve
difference between The ILMC and Eurosonic
subjectson its conference agenda as the
Machin of Storm Crowd suggested a possible
Noorderslag is that The ILMC attracts global
topic of secondaryticketing has already security initiative for ticketing, which is being
players from the live music industry’s premier
been
league, while Eurosonic Noorderslag is a
years. However , The Sunday Supplement,
hotspotfor European festivals, agencies and
takingplace on Sunday at 12.30 and a regular
promoters.
ILMC session chaired by Allan Mc-Editor in
With this in mind, VIP-News will deliver in its
Chief-Gowan inevitably got to the subject.
next issue a proper report on The ILMC 24,
Yes, The ILMC also has its own very valuable
Described as ‘intimate’ and usually attracting
covering more of the panels.
share of upcoming European music industry
only 25 people or so, The Sunday Supplement
intensivelycovered
in
previous
pursued at the moment by Steve and Andy Lenthall of the PSA - watch this space!
5
VIP NEWS >
MARCH 2012
Sale of HMV Live /Mama Group Enters Second Stage Allan McGowan am@vip-booking.com
Hammersmith Apollo is up for sale
Following the early March deadline for bids for the live business
by March 2. It is surmised that offers may only be in the region of £64
interestsof HMV, the company is considering offers for its 13 music
million, the sum HMV originally paid for the Mama Group.
venues, including major London music landmarks the Hammersmith Apollo, and the Forum, along with its five festivals, put up for sale in a
Mama’s festivals and artist management businesses and marketing
‘strategic review’ of its live business, which it acquired from the Mama
partnership may not be wanted by AEG or the eventual buyer and it is
Group in 2010.
thought that MAMA co-founder Dean James is leading a consortium to buy those parts of the firm that are not wanted.
According to The Independent music business players and private equityoutfits have expressed interest, and first round bidders were AEG
The Academy Music Group already operates three major music venues
Live, the Live Nation backed Academy Music Group and equity types
in London along with the operations of its main shareholder Live Nation,
and Time Out backers Oakley Capital.
so an AGM bid could be subject to competition regulator approval. This could be a slight case of musical chairs as MAMA acquired the Apollo in
HMV hired advisers at Citi to put the live music sector on sale in order to
the first place when Live Nation was forced to sell to obtain competition
help deal with its up to £180 million debts. First-round bids were made
regulator approval for buy into AMG.
CBGB Festival Planned Allan McGowan am@vip-booking.com Reports indicate that the legendary and now sadly defunct venue CBGB in New York looks set to be reincarnated as a festival planned for 4-8 July in New York. Following the closure in 2006, the CBGB name reappearedas a short-lived fashion store and an iheartradio channel. It was also the subject of a legal battle amongst members of founder Hilly Kristal’s family for ownership The festival is apparently intended to feature film and conference strands as well as music, although no line-up has been announced. More information at www.cbgb.com
6
CGBG – New York
VIP NEWS >
MARCH 2012
> INDEPTH STORY > THE GREAT TICKET SWINDLE
INDEPTH This month’s feature deals with the furore resulting from the Channel 4 Dispatches programmeon secondary ticketing aired late last month. Our report presents some different viewpoints on one of the industry’s most emotive topics. It seemed, not very long ago that the practice of secondaryticketing had passed into acceptance, with associations like the CPA and othersadopting a ‘if you can’t beat them join them’ attitude’. However the programme has had great effect in the UK and elsewhere, and the argument for and against is firmly back on many agendas!
The Great Ticket Swindle Manfred Tari mt@vip-booking.com
The ‘unfiltered truth’ about “highly, highly immoral” business
governmental institutions rather decided not to interfere or to
methodsat Viagogo & Co:
regulatea market that in the past may have be named as the black market. For instance, in April 2008 the Department for Culture, Sports and Media (DCMS) published a report entitled, ‘Government Response to the Culture, Media and Sport Select Committee Report on Ticket Touting (HC 202 – Second Report of Session 2007-08)’ concluding, alongside other findings that: “The Government does not see a case for any general restriction of ticket resale.”
It was a didactic masterpiece of the very few recent journalistic reportson questionable business practises in the music industry. On
Thus Governmentally supported, the secondary ticketing market
February 23, the TV Station Channel 4 aired an insider report about
in the meantime experienced a boom. Over the years the more
the business methods of Viagogo and Seatwave in the UK. The report
concernedand active opponents of secondary ticketing in the UK
was made for the investigative magazine series Dispatches, and was
live music businessalmost give up. Apart from a few exceptional
entitled the ‘Great Ticket Swindle’. The TV-report revealed in an
initiatives such as the Independent Festival Association’s ‘Ticket Trust’
uncompromisingmanner, just how these prominent secondary ticket
ticket exchange.
exchanges run their businesses. Anyhow, the ‘Great Ticket Swindle’ TV-report produced evidence that Over the years secondary ticketing has become a business model
Viagogo, Seatwave & Co did not just apply a “shady” business model.
attractingmore than touts alone. In fact four years ago especially in
Two journalists worked undercover at Viagogo and Seatwave and
the UK there were already massive protests against secondary ticketing
filmed how the company’s staff bought and sold tickets, on their own
and its main players. There have been political initiatives to ban
initiative or working together with so called ‘power sellers’. The report
secondaryticketing, but the majority of UK politicians and officials in
reveals that in fact the majority of tickets on these ticket exchanges have definitely not been offered by fans to be bought by fans.
8
VIP NEWS >
MARCH 2012
> INDEPTH STORY > THE GREAT TICKET SWINDLE
The TV-report even showed how staff members buying tickets under false identity with credit cards issued bearing the names of relatives to get around the capping of ticket sales per person at websites of primary ticket vendors. And if this is not enough, the programme identified leading UK promoterssuch as Live Nation UK, SJM Concerts or Metropolis Music as allocating significant ticket contingents to these companies. We were informed that SJM Concerts provided 29.000 tickets for the 2011 Take That tour to Viagogo, and another 9.000 tickets for the upcoming Coldplay tour. Live Nation UK it was also reported, provided more than 3,000 tickets for the 2012 tour of Westlife and another 2,200 tickets for the UK tour of Rihanna. Do they pay their employees good salaries or do they even Viagogo even filed an interim injunction to stop the broadcast of the
have a bonus scheme for successful sales results?
TV-report, but a High Court refused it on all points.
– Viagogo internally had a culture of intense commercial aggression, as can be seen from the speech our undercover reporter filmed made
VIP News spoke with David Henshaw, the Executive Producer of the
by Eric Baker to the UK staff.
Great Ticket Scandal after the TV-report was aired. (In that particular scene Viagogo-CEO Baker is filmed at a company What sort of response did you get after the broadcast of the
team meeting when asked about new legal efforts in the UK to cap
“Great Ticket Swindle”?
prices for secondary tickets at no than 10 percent on the face value.
– The response both from the music industry and from the public
Bakers replied: “The odds of that law passing in this country are about
to the programme was huge. At one stage, the programme was
the same as the odds of you turning on your telly and seeing me play
top trend on Twitter in the UK and second in the world. There was
keeper for Chelsea!”)
an avalancheof angry comments from concertgoers who knew somethingstrange was going on, but had never seen the reality. In
– It was clear that - apart from the so-called ‘power sellers’, those
the music industry, Radiohead announced that they would from now
who benefit from Viagogo’s resale of primary tickets are promoters
on only sell tickets through trustworthy agencies that could prove
and event organizers. There has been much discussion in the UK
they dealt fairly with the public. Music Week ran a three-page feature
musictrade press about this, especially in Music Week.
on the programme, and it was discussed in a debate in the House of Commons in Parliament.
Secondary ticketing became a very profitable business at the expense of concertgoers and fans. Do you expect that the
How did the undercover journalists find working for Viagogo
“Great Ticket Swindle” will lead to ticket buyers taking more
& Seatwave?
care about where they buy their tickets in the future?
– They found both companies fairly intense in their expectations of
– I definitely think, judging by the immense response on Twitter
the work force. Seatwave was a little more relaxed than Viagogo,
and elsewhere, that large numbers of fans will think twice before
which was a very competitive environment. In both companies it was
spendingtwo or three times the face value on a ticket. People accept
constantly emphasised how important it was to keep good relations
that if a concert is sold out, there is a market in resold tickets. What
with the ‘power sellers’ - the touts who supplied large numbers of
they don’t accept is that tickets that should have been on sale in the
tickets.
box office are never made available to ordinary fans at face value.
While working for Viagogo, did the journalists discover how
The entire TV-report can be seen on Youtube at:
Viagogo works internally with their subsidiaries in France or
http://www.youtube.com/
Germany?
watch?v=WWlnL8drSdw&feature=youtube
– We didn’t find out a great deal about Viagogo’s operation outside of the UK
9
VIP NEWS >
MARCH 2012
> INDEPTH STORY > THE GREAT TICKET SWINDLE
Biljettbluffen - A Forerunner of The Great Ticket Swindle Manfred Tari mt@vip-booking.com Sweden was surprised to learn about the
Petra Wangler
facts that I presented and promised to take action. Later he stated that he had informed the staff about the policy that the two tickets each staff member is allowed are meant for personal use only. The same rule - no resellingis allowed - applies to the sponsors. Somethinghe said he reminded them of afterthe TV report. Nyamko Sabuni, then minister responsible for consumer issues, had stated in the past that it is really up to the music business and concerts promoters themselves to take action in the matter. But after the TV report she was “prepared to reconsider a new legislation”.
At ILMC Hultsfred festival promoter Gunnar
indeed is organized and that the flow of
Nothing happened though. The secondary
Lagerman told VIP News that a similar TV-
ticketscomes from several directions:
ticket market is still going strong and the fans
Report about secondary ticketing has been
1. Fans and others that simply buy a lot of
still suffer here in Sweden.
show by the public TV-station SVT of the
tickets to sell to others for a higher price.
Swedish Broadcasting Corporation. VIP News
Sometimes students are approached to sit
Did you receive any responses after
spoke to Petra M Wangler, the producer of
by the phone / computer for hours to buy
your TV-report was aired either from
the report about her findings and the results
all they can.
companiesmentioned in the report or from concertgoers that had purchased
of the report. 2. Sponsors that resell their tickets. When did you broadcast the TV-report
tickets on secondary ticket exchanges? – The report was heavily covered in the
about secondary ticketing in Sweden
3. Employees at the ticket offices that break
press and some journalists have kept on
and what was the title of the report?
the rules and - for dirty money - print too
investigatingthe secondary ticket market
– SVT aired the full report in September 2010.
many tickets to customers linked to the
but as far as I know this is a moral question
It was one episode of the award winning secondary market.
and no one (except the fans) is willing to
and critically acclaimed series “Uppdrag
deal with it for real. The answer is of course
Granskning”
/”Mission:
Investigating
4. And - most surprisingly, representatives of
becauseof the money involved. It’s all about
Journalism ”. The episode headline read
the primary market that sell tickets directly to
“I’ll scratch your back - you’ll scratch mine”,
“Biljettbluffen” /”The Ticket Scam”.
the secondary market - under the table.
you see. And the fans- well they are the
Can you please elaborate on the findings
Who else appears with quotes and
change though, since the international
and discoveries of the report?
statementsin your report?
artiststend to tour more nowadays then
– It proved, thanks to several anonymous
– One of my sources confirms a deal like
before but well - I have no facts pointing in
sources that appeared in the programme,
this going down at the Live Nation office in
that directionat all.
that the secondary ticket market for concerts
Sweden . Carl Pernow, CEO of Live Nation
ones that pay. I personally thought it would
10
VIP NEWS >
MARCH 2012
> INDEPTH STORY > THE GREAT TICKET SWINDLE
Secondary Ticketing in Denmark Manfred Tari mt@vip-booking.com
The financial gains offered by secondary ways things are done today through portals ticketinghave over the years become a
as Viagogo, Seatwave and others are in my
huge problem in Europe. Also at ILMC VIP
opinion stealing from the artist. Moreover
News ran into to Jeppe Michael Jensen of
it damages the whole industry as we as
the primaryticket company Venuepoint.net.
primaryticketing agents have growing costs
In the light of the Great Ticket Swindle he
for customer service etc.
Jeppe Michael Jensen
got back to us shortly after the conference to discuss the secondary ticketing situation in
Do you know if Danish promoters are
Denmark.
actuallyworking together with these companies by supplying them with
How would you describe the current ticketing contingents? secondaryticketing
situation
in
– NO!
Denmark? – I have been in ticketing for 12 years and
Do you have any knowledge of how
secondaryticketing used to a problem,
many tickets in general are sold via
howeverit was minor compared to what
secondaryticketing sites in Denmark?
it is today. First sites such as Ebay and
– No.
Please
elaborate
on
why
they
do
this and about the state of the legal
Danishparalleldba.dk were the platform for individualswho made an extra income
What kind of measures have been
from scalping. Danish legislation forbids the
undertakenso far to offset secondary
selling of tickets at over face value, which
ticketing?
– All is still pending at our lawyers. We do also
helped, as no real enterprise was active on
– All our tickets are personal however we
have a dialogue with the Danish Consumer
Danish soil. This has changed with Viagogo,
only randomly check for identity at the
Ombudsman on how to better enforce the
which recently started a Danish version of
venues . We generally warn consumers
current legislation.
their web site. Today we are in contact with
through the media and through our partner
fans on a regular basis who have bought
sites of buyingtickets second hand.
tickets through Viagogo and the problem is
proceedings...
Venuepoint
is
the
company
behind
Billetlugen.dk. Since its launch in 2000 the What is the legal situation on secondary
primary ticket platform became the leading
ticketing in Denmark?
ticketing outlet in Denmark and operates
Which are the main companies offering
– It is prohibited to resell tickets above face
ticketingplatform
secondary concert tickets in Denmark?
value unless you have permission from the
Norwayand biljettforum.se in Sweden. In
–
promoter.
2011 the Company gained a revenue of
increasingdramatically.
Viagogo.dk,
Dba.dk,
Allebilletter.dk,
Buymyticket. dkwhile Seatwave is not yet
Billetportalen.no
in
more than 100 million Euro and employs Venuepoint also just filed an interim
50 people. At the time of the interview ,
injunctionagainst Viagogo.
Venuepointhas been sold to NordiskFilm, a
Can you please explain your point of
– We believe they have violated our
companyproducing and distributingcreative
opinion of the practice of secondary
trademarksby buying Google adwords in our
content in movies, TV and games in four
ticketing?
and our partner’s name.
Nordic markets.
activein DK
– There is of course a legitimate need for consumers to resell tickets they cannot use
For further information please check:
for some reason. However the industrialized
www.venuepoint.net
11
VIP NEWS >
MARCH 2012
> INDEPTH STORY > THE GREAT TICKET SWINDLE
The Great Ticket Swindle from a Legal Perspective Manfred Tari mt@vip-booking.com
The Great Ticket Swindle also covers legal issueswithin the report and therefore
Kai Hermes
Are there similar consumer protection laws in place the UK?
featuredan interview with a legal expert. The
– In so far as this is about a “business-
report features statements from Christian
to-consumer ” (b2c) constellation and the
Twigg-Flesner, a professor at the University
question of unfair commercial practices the
of Hull who concluded that Viagogo’s claim,
consumers in Germany and England should
to be a ticket exchange from fans to fans
be equally protected due to the directive
actuallyis a misleading of consumers.
2005/29/EC of 11 March 2005 concerning unfair
business-to-consumer
commercial
But as the Great Ticket Swindle revealed
practices (so called UCP-directive). This
that Viagogo has been supplied with
directivedemands a complete harmonization
29.000 tickets for the UK-tour of Take That
of the unfair competition law across Europe
in 2011 promoted by the UK market leader
in regard to unfair commercial practices against consumers.
SJM Concerts, the German promoter MCT successfullybanned secondary ticketing for
VIP News asked Hermes to watch the Great
the three shows he promoted with the act
Ticket Swindle and to evaluate on the legal
In reference to the business practises
in Germany.
aspects raised as part of the report.
of Viagogo are there also other law
To achieve this MCT worked together with
How do you comment on the findings
consumers from these kind of business
Smart Tickets and the law firm CMS Hasche
of the Great Ticket Swindle from a legal
methods?
Sigle. Kai Hermes was one of the lawyers
point of view?
– Competitors or consumer protection
who on behalf of MCT laid out the terms and
– Viagogo and the other firms present
authoritiescan attack an infringement of
conditions that went along with the tickets
themselvesas ticket exchanges that enable
the UWG. A complaint to the consumer
for these concerts and explicitly forbade the
fans to buy and sell tickets from each other
protectionauthorities could be helpful. The
resale of tickets. Furthermore all tickets were
(“fan to fan”). However, according to the
information of consumers could be another
sold personalized like aviation tickets, while
report of “Dispatches” staff members sell
possibility to protect them against the
Smart tickets supplied a ticketing system that
the majority of tickets. These employees
businessmethods of these exchanges. From
enabled the security staff of the promoter
optionallychange the prices for the tickets
a legal point of view the personalizationof
to check in real time a ticket data bank at
in order to get the maximum of profit. Thus
tickets according to German law provides
the doors of the venues, checking if tickets
the consumers get false information about
for another protection of the consumers
were valid and that the name printed on the
the nature of the sales process, about who
against the distribution of tickets via such
ticket matched the ID-card of the card holder.
is the seller and about the manner in which
“exchanges ” that are in fact selling the
This ensured that tickets sold via second-
the price is calculated. This is misleading.
ticketsthrough their own staff as commercial
ary ticketingwebsites were identified and
Moreover, it is likely to be an infringement
dealers.
declaredinvalid. Buyers of these tickets have
of the so-called black list of the German
been supplied with an information sheet
UnfairCompetition Act (UWG) with the
Kai Hermes can reached at CMS Hasche
how to sue the seller of those tickets.
consequencethat these commercial practices
Sigle, for further information please go
are in all circumstances considered unfair.
to: http://www.cms-hs.com
opportunitiesin Germany to protect
12
VIP NEWS >
MARCH 2012
> INDEPTH STORY > THE GREAT TICKET SWINDLE
A Wider View of The Great Ticket Scandal Allan McGowan am@vip-booking.com
vital and interesting points, it also missed out
ticketsmade available, and the size of the
large chunks of the bigger picture…
venues. The better the tour can predict demand, and price tickets accurately against
Bringing
investigative
fans expectation of value, the more effective
techniquesto bear, Dispatches sought to
an
arsenal
of
the yield will be in returning a profit on the
exposewhat it had clearly predetermined
risked capital.
was the dark side of the hitherto opaque
Steve Machin
and mysterious world of the concert industry
What risk? A question asked by the
- ticket sales and resales . The sense of
programmewas “how hard is it to predict
entitlementand expectationthat fans can
how successful a comeback tour by Take
show, rightly or wrongly, regarding an act
That might be?” It was raised precisely to
and their ticketsis startling and Dispatches
underminethe notion that there is any risk
exploited this highly charged topic to create
in promoting concerts. While some tours are
what it portrayed as a sensational scandal.
inherently more risky than others, one only
A pioneer of the European live entertainment
has to look at the annual returns filed by
space, Steve Machin has a wealth of
But while the programmedid uncover what
Live Nation to see razor thin margins where
experiencein
appeared to be genuine legal concerns
even a small amount of increased risk could
marketing. He was Head of Music Services
around some aspects of the descriptions
significantlyimpact upon the business.
for Ticketmaster Europe where he was
of the resale market, overall I would argue
responsiblefor developing new services and
that the sensationalist approach that it took
client strategies across Europe and beforethat
failed to give an accurate representation of
Risky Business
ran UK National Operations for Channelfly
the complex economics of the 21st century
So how do the promoters reduce their
(MAMA Group). While at Ticketmaster, Steve
ticketing market.
risk? By selling tickets at prices that are low
ticketing
strategy
and
introduced the concept of dynamic pricing
enough to ensure that sufficient attendees
to European concert promoters and initiated
provide a return on investment, and that
the charity ticket auction program used by
Rockonomics
price, for some of the tickets is below market
iTunes. He also worked with Tixdaq, the UK
In order to understand this, we first
value, while for others is above market value.
ticket comparison and data service launched
need a quick (and simplified) overview of
in 2007, to monitor the burgeoning ticket
rockonomics. Economists talk of supply and
It is a common complaint that “music or
resale market.
demand, yield management and mitigation
concertscannot be reduced to a commodity
of risk - do these principles apply to the sale
and traded” - I am no apologist for the areas
He is an evangelist for the uniquely powerful
of tickets? Absolutely. The promoter acts as
of the resale market that were exposed
role that the live experience plays throughout
an initial speculator, buying the performances
as legallychallenging from a consumer
a fan’s relationship with an artist and how that
(and related services such as venue hire)
protectionviewpoint, nor making any claims
relationship can be nurtured and developed
hopingthat they can make a profit on the
as to whether it is right or wrong to trade
through technology. He presently heads up
totalcost of the tour, by sellingsufficient
tickets - that is not the subject of this piece
Stormcrowd - an entertainment consultancy
ticketsat the right prices. The promoter – but what is clear is that tickets ARE traded
specializing in ticketing and socialcommerce.
assumesrisk from the performers.
like commodities. That is in part because there continues to be a consistent disparity
14
In this article he argues that whilst Channel4’s
The perceived demand impacts upon supply
between the market price of a ticket and the
Great Ticket Scandal raised some extremely
variables - ticket pricing, the number of
published face value at which it is first sold.
VIP NEWS >
MARCH 2012
> INDEPTH STORY > THE GREAT TICKET SWINDLE
Not all tickets are created equal, and over
they did not tell the whole story about many
insensitivecustomers who are willing to pay
time the value of each ticket will vary - see
of the points that they covered.
a premium to acquire tickets closer to the
a recent article by PRS for Music for a good
event date.
review of the economics of ticket discounting
1. Fans learned that a significant proportion
- the “front rows” get traded while there are
of tickets sold on ViaGoGo and Seatwave are
3. More surprising was the evidence that
still seats available “at the back”
not sourced from individual fans lookingto
staff at ViaGoGo have purchased tickets
sell tickets that can no longer be used - the
from primaryvendors such as Ticketmaster
The internet has simply made it much easier
notion of being exclusively fan-to-fan is a
to resellusing the company’s own “internal
to buy and sell most products, everything
misnomer as tickets come from brokersand
seller ” accounts. There is a significant
from ipods to insurance and all points in
box-offices. It is worth noting, as Dispatches
differencebetween market clearing price
between. Tickets are no different and with
failed to mention, that Seatwave states
(which is generallyconsidered a good thing
arbitrage opportunity available the internet
clearlyon their website when tickets have
economically) and an exchange making the
allows buyers and sellers to easily connect
been made available directly by the box
market under false pretenses.
and transact at market price - leading to the
office.
creation of an additional layer of speculation
The public rage on twitter during the
- fans who buy more than they need, and
2. We also heard that on some tours,
broadcastwas aimed squarely at the
professional brokers investing in buying
ViaGoGoand Seatwave are provided tickets
exchangesand promoters, and assumed (as
ticketspurely to resell - the cold harvesting
directly by the promoter to sell at the best
Dispatches suggested) that artists or their
of tickets.
price possible. The presumption was that
management are not aware that tickets
tickets are always sold at astronomical prices
are allocated to exchanges. Speaking to
above face-value. In reality, tickets are often
Pollstarreporter John Gammon following the
The Whole Truth
sold on exchanges, or other discount channel
broadcast, Live Nation’s Paul Latham stated
The Dispatches investigation wanted to
sites at significantly below face value. The
that Live Nation has never allocated tickets
ensurethat this programme was car-crash
cold truth is that exchanges can provide
without the knowledge and consent of the
television of the highest order. In doing so
accessto a cohort of demonstrably price
artists’ management. The Concert Promoters
15
VIP NEWS >
MARCH 2012
> INDEPTH STORY > THE GREAT TICKET SWINDLE
Association issued a statement to the effect
Built in part on largely one-sided questioning
that placing tickets into the secondary
designed to elicit highly emotional responses
marketreduces prices by increasing supply,
from disgruntled fans who chose to purchase
and ensures that additional value is captured
tickets (and similarly grief stricken tales
within the industry.
from disappointed fans who chose not to) the programmefailed to make a balanced
Dispatches also failed to mention that there
representationof issues affecting the ticket
are already mechanisms available that make
business. All the primary stakeholders in the
ticket reselling more difficult should a tour
concert industry that i speak to are concerned
choose to. These include paperless tickets
with how to get more fans, to habitually
that require the purchasing credit card to
attendmore shows, more often. That is the
be present or photo-ticket schemes such as
wider challenge that frames this debate.
that used by Glastonbury festival. However removing speculators exposes the tour to
(This article previously appeared in Record of
true demand, a point made eloquently earlier
the Day - a daily music industry newsletter
this week by Bob Lefsetz in his industry blog
featuring the most relevant news along
(www.lefsetz.com) and this is not always
with a future hit track. As VIP –Booking
good news for the artists or promoters.
informsthe live industry so Record of the Day keeps other aspects of the industry – as they say, in tune. Sign up for a free trial at
The Fans Pay the Bills
recordoftheday.com)
The wider impact of price sensitivity on the concert business must be considered for
www.stormcrowd.com
everyonecompeting for the same share of the fan wallet. Do fans who decide to not spend money on a ticket spend it on other concerts
Further reference
or other music entertainment productsor do
Bob Lefsetz (@lefsetz) on ticket
they spend it on computer games or fashion
scalping:
or some other category? Do fans who spend
http://lefsetz.com/wordpress/index.php/
high sums of money on concert tickets spend
archives/2012/02/28/john-mayer-fights-
less at the venue on F&B or on merchandise?
scalpers/
Will dynamic pricing be a reality and provide genuine real-time market pricing for concerts
Pollstar review of Dispatches:
and would that be embraced by the industry
http://www.pollstar.com/blogs/news/
and fans alike as a fair solution?
archive/2012/02/24/797458.aspx
Ultimately in such a complex market there
PRS article on ticket discounting:
are a lot more questions than answers - while
http://www.prsformusic.com/creators/
emotions clearly run high when discussing
news/research/Documents/Economic%20
entertainment tickets, does it mean the
Insight%2024%2016_12_11.pdf
governmentshould legislate and introduce price regulation into efficient markets? After
PRS article on Secondary Market
all the face value is an arbitrary price that
Analysis):
could have been set much higher or much
http://www.prsformusic.com/creators/news/
lower. And anyhow now that these markets
research/Documents/Will%20Page%20
exist, can the genie be put back in the
(2006)%20Economic%20Insight%201.pdf
bottle? Would it be helpful, and to whom? Dispatchessuccessfully demonstrated that some fans care a lot about ticket pricing but that even more care about transparency.
16
MyMusicMailer.com enables artists to MAIL their music to more than 6.000 venues and agencies worldwide…
VIP NEWS > BUSINESS > MARCH 2012
MUSIC IN SHARES
Music in Shares Manfred Tari mt@vip-booking.com
Higher Revenue and a Lower Loss for Live Nation in 2011 Live Nation’sThe business report for 2011 improved compared to
than 6 percent. While the closing price on February 23 was at $10.5,
the year before. The concert giant managed to improve its revenue
the lowest price one day later was at $9.45. Actually the share price
resultfrom $5.065 to $5.383 billion and also lowered its net loss from
performance of LYV until February 24 performed well, but since then
minus$228.3 to just minus $83 million. After the announcement of
came down to $9.34.
the results the share price of Live Nation suffered a sharp loss of more
CTS Eventim Lower Revenue in 2011 Shortly after Live Nation, CTS Eventim revealed its business results
beforeInterests, Taxes, Depreciation and Amortisation (EBITDA)
for 2011. The revenue gross went down from 519.6 to 502.8 million
moved up from 88 to 94.6 million Euros. The share price also benefits
Euros. In particular the revenue results for the Live-Entertainment
from the hope of possible compensation payments by Live Nation due
divisionwent down from 333.8 to 281 million Euro. Nevertheless
to the arbitration case between both companies. Currently the share
the shares gained as the Company still delivers profits. The Earnings
stands at 25.76 Euro.
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MARCH 20 2012 NEWS > MISC > SEPTEMBER 2011 >12MARCHVIP VIP NEWS > MISC
MEMBER PRESENTATION
Marc Kirchheim Entertainment GmbH and Co. KG MKE is an internationally-oriented commercial agency for star acts, personalities and high-carat artistes with a focus on the event sector, the advertising and industrial sector Nationally and internationally renowned stars and artistes offer a wide variety of options in event marketing and other sectors of the communications industry for image transfer to products and services
But our work doesn’t stop with negotiating a celebrity appearance.
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About Our Company VIP-Booking’s core product is the Internet’s oldest and
Today VIP-Booking offers a range of tools for the
largest database for the European Live Entertainment industry– including VIP-News, VIP-Booking, VIP-Book MyMusicMailer.com enables artists to MAIL their music Industry www.vip-booking.com developed as a tool for and VIP-Contract. to more than 6.000 venues and agencies worldwide… industry professionals. Since it’s launch in the year 2000, Please visit vip-booking.com for further information. we have consistently offered our subscribers the very best in database services and now boast subscribers in
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