A growing chorus of managers have been speaking out against Ticketmaster’s Fan Club rules, sullying the company’s rollout of OnTour, the new name of its Artist Services group.
OnTour is the new weapon Ticketmaster and Live Nation plan to deploy against emerging rivals CrowdSurge and Songkick. CrowdSurge is a VIP ticketing company that enables artists to sell tickets on their websites and gives bands all sorts of e-commerce options and data reports that they can’t currently get with Ticketmaster. Songkick is a concert discovery engine that notifies fans when their favorite bands come to town.
The two companies merged in June and have attracted a number of big-time investors, many who see CrowdSurge as way to scoop up tickets usually protected by exclusivity clauses. Typically, artists are granted 8-10% of the tickets for a show to sell directly to fans. It’s a practice Ticketmaster has allowed for decades, but as more VIP companies pop up and a profitable tech sector emerges, TM officials are increasingly saying “no” to artist ticket allotment requests — especially those that will be resold on CrowdSurge.
After all, Ticketmaster paid millions of dollars for the rights to sell tickets at venues like the Forum so they could have exclusivity, that peculiar institution of this music industry of ours. Don’t get me wrong — exclusivity agreements are a landmark of American business, but in music, exclusivity has been vastly over-used.
There’s a half-dozen reasons why exclusivity isn’t really exclusive. For starters, every team, artist, touring show, venue and festival have their own exclusivity agreement in place, creating a confusing fabric of deals and agreements that take armies of lawyers to sort through. That results in dozens of loopholes and side deals that are then unevenly applied and rarely relinquished. Exclusivity is not something that contractually binds people — it simply creates a speed bump that the loudest and most powerful can overcome through threats and kickbacks.
Ticketmaster’s fight over fan clubs is all about protecting its exclusivity deals. TM executives see CrowdSurge as a loophole and well-funded backdoor to inventory that should be TM’s. Inventory they’ve been losing because their tools have generally sucked compared to CrowdSurge and other VIP services with more nimble, fan-friendly offerings. TM is hoping its newly re-minted Artist Services group will change that.
The Spiel – What is OnTour?
On Wednesday, TM’s SVP Zeeshan Zaidi began the public rollout for OnTour, the company’s newly christened Artist Services division. With new products like Ticker — the company’s mobile reporting app — and an integration with media measurement tool Big Champagne, TM is positioning OnTour to take on companies like CrowdSurge.
OnTour has the obvious advantage of being in the position to approve or disapprove every artist that wants to pull down tickets and sell them on CrowdSurge. And in recent months, Zaidi has been saying “no” more often.
Zaidi took over the Artists Services division earlier this year with the exit of Greg Schmale, who ran the division for 18 years before leaving in August and eventually landing a job at Songkick as the VP of Industry Relations.
Remember, Songkick merged with CrowdSurge, and whispers around the industry suggest that TM’s obsession about crushing CrowdSurge is partly driven by some paranoia about having a former insider now working for their competitor.
Zaidi has worked at several major labels including RCA, Sony and Arista and served as COO for LimeWire, at one time the world’s large file-sharing site. LimeWire was shut down by a federal judge in 2010 over complaints by the RIAA that it facilitated music piracy on a massive scale. The company ended up paying a $105-million settlement to the record companies. Zaidi was brought on to help the company go legit and strike deals with record labels to create a streaming music business, much like Spotify.
Zaidi left LimeWire in 2011 to run a social media company called Host Committee. Zaidi is also the front man of indie rock band The Commuters and a Harvard Law graduate and native Canadian who dapples in diplomacy as a member of the Council on Foreign Relations.
Folks who know him said Zaidi’s interest in foreign affairs and diplomacy shapes his world view and business outlook, and those skills will be especially useful as he deals with an uprising from the artist community.
The Real – Who Can Put Down The Manager Revolt?
Yesterday, I interviewed Traci Thomas, manager for red-hot Americana singer Jason Isbell. Thomas told me a familiar story that other managers have been repeating throughout the week. When Thomas tried to retrieve her 8-10% ticket allotment to sell on CrowdSurge, she was told by TM’s Artist Services group that Isbell’s fan club didn’t meet TM’s fan club guidelines. Isbell would not be given his ticket allotment — if he wanted to do fanclub presales, he’d have to do it through TM.
“In the future I will try not to book rooms that use Ticketmaster,” she told Amplify in a phone interview. “It’s not fair for Ticketmaster to tell an artist how to do their business. Last time I checked, people bought tickets to hear Jason play his music, not to see Ticketmaster.”
Isbell’s headaches followed similar complaints from bands like Between the Buried and Me and Underoath, whose manager Randy Nichols first brought attention to the issue. One by one, artist managers have been publicly sharing their stories about similar fan club horrors. Manager David Gottlieb had one of the better tales, recalling how The Hold Steady were denied a fan club allotment during the NBA All-Star Game for a charity event.
“I told Ticketmaster ‘You’re going to make a big deal over 50 tickets to a benefit concert?’” he told Amplify. After the experience, he decided to give TM a chance and “when my next artist had a tour, I told Ticketmaster ‘Fine. It’s yours. You can do the presale and everything else.’” And that’s what happened, TM did the presale. According to Gottlieb, it didn’t go very well. We’ll spare you the details.
And for the record, there are thousands of artists big and small who choose to work with Ticketmaster, but the fact that a number of managers have come forward to speak out against TM is itself noteworthy. In the nine years I’ve covered the music business, I’ve never had so many managers want to go on record. This is a group of people who rarely, if ever, speak to the press. The lesson from the downfall of legends like Colonel Tom Parker & Jerry Heller is clear — a good manager usually shuts his mouth and stays in the background, unless of course, someone is fucking with their artists.
Another important lesson — if you take something away from an artist, they are going to get really, really pissed. Sure TM is trying to protect its business, but that rings hollow with artists who are seeing an important revenue stream taken away. Ticketmaster hopes OnTour will be a viable competitor against CrowdSurge, but they risk starting a war every time a major artist chooses CrowdSurge and TM reacts by trying to stop the deal with confusing fan club rules. If Ticketmaster wants to compete and win fairly, it’s also going to have to learn how to lose fairly.
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