Hello, I am a twenty six year old writer from Chicago who is both interested and active within the music and art community in my city. Recently, over the last six months, while attending a wide variety of both underground and popular concerts and promotional events in Chicago and throughout the U.S., I began to notice that the prices we, as young consumers, are paying for our tickets appear to be growing exponentially, if not exorbitantly, topping out in my personal experience after paying almost $45.00 to Ticketmaster to see a concert for a ticket with a face value of only $35.00. Naturally, I become very inquisitive concerning this increase of almost 25 percent and sat down to do some research to see if I could reconcile this discrepancy….the outcome became this article. While trying to remain as unbiased as possible, I increasingly found it more and more difficult as the facts presented themselves and light was shed onto some of the underlying tones which have been snow balling over the last amount of years. After a couple of re-writes and some considerations toward tone I’ve settled on this, which I would now like to pass onto you. While I understand you normally only publish or print material from students or persons related to the University, I feel it necessary to spread the information I have found. Live music, for both the fans and the artists MUST remain accessible. It is our indispensable outlet for passions and emotions, messages and ideas, a force unparallel within the hearts and minds of both the young and old…our glimpse inside at the composition which makes us bound to one another as humans. Whether you find it to be either adequate or non-appropriate for conventional means, please feel free to pass it on via hard copy or email to any and everyone you feel and/or think might find it valuable. I believe there are many who share the same sentiment in all musical genres…that something must change, that something must be done. It would appear we are the generation and demographic most affected by this current trend. I only ask that the article (along with the first paragraph of this cover letter as a leader if you so choose), in its entirety, not be modified or amended and that the affiliation with thematchfactory.com accompany it. Thanks for your time.

Sincerely, Craig Turnwall2170 W. Windsor Ave. #1RChicago, IL 60625Ph: 773-619-1012

You and I Vs. Ticketmaster Playing Monopoly

Do not pass go. Do not collect two hundred dollars.

Over the last ten years in both the music and business world Ticketmaster has become our generation’s new synonymic bell for convenience charges, surcharges and most notably, antitrust litigation. In the grunge rock madness of the 90’s it was Pearl Jam who sought to gain a foot hold against the ticketing giant, a well documented media frenzy that left them with a cancelled tour and no ground with which to brace their soles upon due to the small yet consequential fact that they, themselves, did not actually own a rival ticketing company. A fact which ultimately left enough of a loop hole for the behemoth to escape unscathed. Recently, although largely out of the media lime light, it was the Colorado band the String Cheese Incident who filed suit, sighting that they felt it not only just, but imperative for them as artists to keep concert prices down and sell tickets directly to their fans via their own ticketing company, SCI. Their suit was settled casually and quietly with a deal that was struck between lawyers, the terms and conditions remaining confidential. But what does this leave us answered? Why are the tickets we are buying from Ticketmaster creeping into excess of the five, six, even seven dollar range in additional charges? Where is that money going? Is Ticketmaster a monopoly? In 2003 Ticketmaster sold 100 million tickets to the tune of 4.9 billion dollars through its website, 3,300 retail outlets and 19 worldwide telephone call centers according to IAC (InterActiveCorp), its parent company. It also states that it serves more than 8,000 clients worldwide and acts as the exclusive ticketing service for hundreds of leading arenas, stadiums, performing arts venues and theaters. (www.iac.com) Rolling Stone, in August of 2003, tried to shed some light onto what those numbers actually mean for us here in the United States. According to their figures Ticketmaster controlled 89 percent of the top 50 arenas that year, 88 percent of the top amphitheaters and approximately 70 of all “top” theaters. Now, in 1890 Congress passed The Sherman Antirust Act as a principal commitment to American consumers for a “…free market economy in which competition free from private and governmental restraints leads to the best results for consumers. Congress felt so strongly about this commitment that there was only one vote against the Act.” (U.S. Dept. of Justice) Section 2 of this act, entitled; Monopolizing trade a felony; penalty states “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony,” (ibid) continuing on as it mentions specific fines and imprisonment terms for a conviction related offense. While Ticketmaster does not call themselves the world’s “largest” ticketing company, only the world’s “leading” ticketing company, there gives way to a shadow of grayness as to where becoming a monopoly begins and the measures to make it end. IAC (previously known in reverse succession as USAI, HSN and Silver King Communications, Inc) acquired 50% of Ticketmaster in May of 1997. In June of 1998 they continued by acquiring the remaining interest in Ticketmaster from the public and in January of 2003 they cinched their endeavor by gaining hold of all the remaining shares, a move that was announced in October of 2002. While acquiring a controlling share or even the entire assets of a company is by no ways illegal, recent headlines from the PR Newswire seem to paint a different, more aggressive picture as their stake and reliance on the ticketing company has increased: Ticketmaster and St. Louis Mills’ iceZone Announce Opening of New Retail Ticket Outlet, March 22 2004; Ticketmaster Expands Presence in Alaska; SMG and Ticketmaster Sign Multi-Year Ticketing & New Technology Agreement for Premiere Alaskan Venues, May 19 2004; Ticketmaster and Kroger Expand Exclusive Ticketing Retail Outlet Agreement, May 24 2004; Ticketmaster Announces New Ticketing Initiatives with Montana ExpoPark, May 24 2004; Ticketmaster Announces New Ticketing Initiatives With Mohegan Sun, June 22 2004; Ticketmaster Announces New Ticketing Initiatives with Boston University, July 21 2004; Ticketmaster and Meier & Frank Sign Exclusive Ticketing Retail Outlet Agreement, August 17 2004 etc. Ticketmaster has not just confined itself to U.S. borders though. In 2004 it acquired Lippupalvelu Oy, Finland’s leading ticketing service provider along with BiljettDirekt Ticnet AB, Sweden’s largest event ticketing company expanding its European assets to now include England, Scotland, Ireland, Norway, Denmark, Finland, Sweden and The Netherlands.

Let’s see…that’s hotels on both Boardwalk and Park Place along with 8 Community Chest cards.

Roll.

Why the explosion? In 2003 Ticketmaster signed an exclusive multi-year ticketing agreement with Major League Baseball and started an online service enabling customers to bid for the best seats at particular events, a clever move allowing consumers themselves to inflate the face value of ticket prices in a competitive environment while Ticketmaster watches eagerly, reaping the exorbitant benefits. Some of these auctions seem relative and correct; Ticketmaster and the Atlanta Hawks Launch Online Ticket Auction for VIP Ballkid Packages; Bid for your Child’s Chance to Receive VIP Treatment as an Official Ballkid at the Hawks vs. 76ers game April 6th, (PR Newswire 2004) while others, Ticketmaster and the Orlando Magic Launch Online Ticket Auction for VIP Magic Dancer Package; Bid for the chance for you and a friend to win a dream dinner with two of the gorgeous Magic Dancers, (PR Newswire 2004) seem to target specific demographics which are prone to spend higher dollar amounts and have more available credit. It appeared as if Ticketmaster had cornered a market within itself. In 2004 however, Ticketmaster began to worry as “the number of tickets sold declined from the prior year due to the overall weakness of concert ticket sales in 2004 compared to a strong concert season in 2003.” (IAC Q2 Report) InterActiveCorp’s second quarter results go on to say that although it’s “operating income decreased 1% to $110 million, net income decreased 25% to $70 million, and GAAP Diluted EPS (Earnings Per Share) decreased to $0.09 from $0.16,(-41%)” (pg. 1) “Ticketmaster grew Operating Income Before Amortization by 29% over the prior year to $46.7 million, with operating income up 43% to $40.5 million. Revenue growth was driven by increased revenue per ticket from higher convenience and processing fees and favorable exchange rates from foreign markets” (pg. 5) I realize that for an IAC investor this might sound like great news, but for the consumer (such as myself) it gives way to an emptiness in the pocket book and a feeling of helplessness when I watch those numbers exceed seven dollars in the little box on the upper left hand part of my ticket stub. According to Rolling Stone (August 2003) approximately 40% of the convenience charge actually goes to Ticketmaster while 25 percent goes to the venue and the rest is distributed to business partners and the concert promoter. This, in conjunction with its enormous distribution power and aggressive marketing is what helps make Ticketmaster not only accessible and popular but pleasurable for all parties involved with any particular show. However, what I find interesting is that IAC/Ticketmaster is completely open about disclosing not only exactly where their increased revenue is coming from but more importantly HOW they are going about it. How can they do this without blinking an eye, without worry it will hurt their current economic position?…without fear they will lose customers?

Okay…you’re using the Get Out of Jail Free card.

When is it our turn?

Simply stated, Ticketmaster has no comparable competition. While we, the consumers, would undoubtedly benefit from direct competition between major ticketing entities…there happens to be none, limiting us to our only choice in the world’s “leading” company. It would seem as if Ticketmaster has successfully secured its standing and consumed the market not only here at home but also abroad, (i.e. Scandinavia) and has put a restraint hold on any small effort to open their “corner” to other interested parties or new alternatives which give the artists more control over the prices they charge for shows. We, both the artists and fans, are paying dearly…no pun intended. What can we do?

Double fives…we roll again.

The U.S. Department of Justice Antitrust Division states that “an unlawful monopoly exists when only one firm controls the market for a product or service; and it has obtained that market power, not because its product or service is superior to others, but by suppressing competition with anticompetitive conduct.” By “leading the world” does that mean that Ticketmaster’s service is superior, therefore rendering it out of lawful jurisdiction? Does its exclusive quantity equal our quality? That is something each one of us must decided.

– Craig Turnwall Chicago, IL www.thematchfactory.com

– If you would like to make a comment concerning Ticketmaster or any another antitrust issue, please submit it to the Bureau of Competition (antitrust@ftc.gov). To help them serve you better, please include a day-time telephone number in your communication.