That’s The Ticket!

Live Nation officially ended its contract with Ticketmaster Dec. 31 and launched Live Nation Ticketing on New Year’s Day. Can LN successfully launch the first-ever, true alternative to TM?

There has also been confusion as to whether Live Nation would have an all-inclusive ticketing price, although Live Nation spokesman John Vlautin was quick to point out to Pollstar that the company has never said it ever planned to implement that model.

What is known is Live Nation Ticketing has seen its first month and is gearing up for a big summer. Live Nation Ticketing CEO Nathan Hubbard discussed with Pollstar where things are heading.

Although Live Nation Ticketing is up and running, when can we expect to see its first big test?

I don’t know what you mean but I can tell you that we’re fully under way. We’ve converted almost 80 venues across the country. We sold out a Dead show at (the 22,000-capacity) Shoreline Amphitheatre last weekend. We’ve got a bunch of big amphitheatre shows already going on sale. All of our North American owned-and-operated venues at this point are converted over. So, if you want a big launch, there you go.

We’ve undergone the largest transition in the history of the industry and so far we’re very pleased with how it’s gone. We’re not going out and making a bunch of noise about Live Nation Ticketing in the marketplace but, rather, leveraging the marketing around an artist and their show to direct fans to LiveNation.com.

Remember, before we launched the ticketing initiative, we were the second-largest live event portal in the industry. So we already had a great deal of traffic. We’ve got relationships with tens of millions of music fans, so that’s a great foundation for us to sell tickets.

I think what we’re seeing, without question, is the fan finds the ticket, and the Dead show is a great example of that.

I’m going to press the “big launch.” I’m referring to a national launch of a Live Nation tour, such as a U2.

Look, we put tickets up for Dave Matthews Band last weekend. Phish goes on sale Jan. 30. There are some Jimmy Buffett shows that go up Jan. 30, and those guys are going to play a full suite of dates in our amphitheatres this summer.

So we’re up!

Again, I think people were expecting us to come out there and do Live Nation Ticketing-branded marketing. We want to put all of our efforts behind our artists and their shows. I think that’s an effective way for us to recondition the fan to buy from us.

We sold millions of tickets through LiveNation.com last year, so it wasn’t a big jump for us to replace the back-end and begin to sell our own tickets, from a marketing standpoint.

So is this your first chance to take a breath since the Jan. 1 launch?

I don’t think I’ve had a chance to take a breath yet! We started to take things live in late December. We’ve been transitioning over markets almost daily and got everything rolled out right around the first week of January, and we’ve been up and running.

Like I said, I think it’s gone about as well as I could have hoped so far but, obviously, we have a lot of shows ahead of us and we’re really focused right now on working with our artist clients to help them sell as many tickets as possible in 2009.

Considering things are moving smoothly, is there a “next step” that’s ready to be implemented?

Our initial goal was to replace what our previous ticketing partner had been doing and to start at par, then to start looking for ways we could begin to change the model. As you know well, our job is to service the artist and we’ve come out of a relationship that was one-size-fits-all and now we have the flexibility we need to create programs and distribution opportunities and marketing campaigns with our artist clients.

But we don’t do that without consulting with them. We have a list of a lot of things we would like to try this year. What we’re doing now is looking for the “thought leaders” among our artist clients who are willing to test the waters.

Some of the media has been focusing on the service fees.

Yes, we’re charging service fees. Our original intent was to replace what service fees would have been in our venues with a caveat that we’re moving to a single, upfront, all-in fee – not bundled with a ticket price, although the artist has that option.

We’ve done this because we believe it’s more transparent. As we went out and surveyed thousands of fans, our impression was that they were frustrated by a series of fees. So what we’ve done is try to move to transparency for the fan on what the overall value and cost of the experience is going to be, then give them the opportunity to decide if we’re pricing that inventory appropriately.

I think the secondary market teaches us every day that there are opportunities to better price our inventory – sometimes higher but frequently lower. So what we’re trying to do is get focused on the overall amount we’re asking the fan to pay. We think bringing that fee upfront in the process is the first step.

And now, from here, we’ve got the platform to work with our artists on a variety of creative deal structures.

We look at the service fee as an extension of the ticket price. Many parties in the value chain participate in that fee – venue, promoter, ticketer … artist, either directly or indirectly. So we’re trying to create that transparency so you can have a straightforward discussion with the artist and the various parties who participate in the show but also with the consumer about what we’re asking them to pay for the concert.

But the transparency includes a service fee?

Here’s the difference. There are really two things for us that focus on the issue of transparency. One is, the upfront fee versus [the Ticketmaster model of] a service fee and then, on the next page, a per-order fee and on the next page a shipping delivery. We’ve shrunk all those down and amortized them and put them into a single fee.

In other words, here’s the ticket, here’s the ticket fee, now go select your delivery. Nothing additional for U.S. mail. Nothing additional for print-at-home. No per-order fee on top of that.

Now, we developed that all-in fee to match what would have been done in our venues. But that’s where we’re starting.

Now, again, because we look at it as an extension of a ticket price, we can sit with our artists and offer some creative deal structures. We can go all in. We could just present a single price to the customer. There are ways we can change how the fee is presented, depending on how our overall deal works with the artist and so we’re working collaboratively with our artist partners to try some new things.

The second thing is, in our reserved venues, we now have select-a-seat functionality. A big piece of feedback we got from the fan was, they didn’t want to be told what tickets were available. They wanted to go in and choose what “best available” means to them. So now they can literally pick their seats out of a map and we think that’s a big step forward in the industry.

Anything in closing?

Well, from our side, those have been questions that we’ve certainly been asked – where are we, help us understand how the fee structure works, and what can we expect to see going forward. Hopefully we’ve answered your questions.