GOOD. AT THIS PACKED HOUSE, UM
ALL OPEN BY SAYING THAT THE
TAYLOR SWIFT FAN IN MY HOUSE WAS
VERY IMPRESSED THAT WE HELD THIS
HEARING ON THE 13TH. SO I JUST
WANT TO POINT THAT OUT FOR THOSE
THAT DON'T KNOW THAT IS TAYLOR
SWIFT'S LUCKY NUMBER. UM SO, UH,
GOOD AFTERNOON AND WELCOME TO
OUR JOINT INFORMATIONAL HEARING
HOSTED BY THE COMMITTEE ON
PRIVACY AND CONSUMER PROTECTION
AND THE COMMITTEE ON ARTS,
ENTERTAINMENT, SPORTS AND
TOURISM. UH, SO I WANT TO THANK
ALL OF OUR PANELISTS FOR BEING
HERE TODAY AND PARTICIPATING IN
THIS HEARING. OBVIOUSLY THIS
ISSUE HAS BEEN THE HOT TOPIC FOR
OVER A YEAR NOW, AND WE'RE
REALLY EXCITED TODAY TO, UM
REALLY GET TO A GREAT
CONVERSATION ABOUT THE ROOT OF
HOW WE PROTECT CONSUMERS IN THE
TICKETING INDUSTRY, WHICH IS
OBVIOUSLY, UM, THE FOCUS OF THIS
CONSUMER PROTECTION COMMITTEE.
UH, I WANNA THANK BOTH THE STAFF
ON OUR COMMITTEE, PRIVACY AND
CONSUMER PROTECTION AND THE
ARTS, ENTERTAINMENT, SPORTS AND
TOURISM COMMITTEE FOR ORGANIZING
THIS HEARING AND THE STAFF FROM
RULES, THE SURGEON'S OFFICE AND
EVERYONE ELSE WHO HELPED TO
SUPPORT US HAVING THIS HEARING
TODAY. UM SO BEFORE MOVING ON, I
WANT TO MAKE SURE THAT EVERYONE
KNOWS THAT AT THE CONCLUSION OF
EACH PANEL WILL BE OPEN TO
DISCUSSION TO THE MEMBERS
PRESENT. UM SO HOLD YOUR
QUESTIONS FOR THE PANELISTS. WE
WILL DEFINITELY SET ASIDE TIME
FOR THAT. AND FOR THOSE THAT ARE
NOT ON THE PANELS, BUT ARE HERE
TODAY WE WILL BE SETTING ASIDE
TIME FOR PUBLIC COMMENT AT THE
END OF THE HEARING FOR THOSE WHO
WANT TO PARTICIPATE. UM SO THE
PURPOSE OF THE HEARING TODAY IS
TO HEAR FROM THOSE WORKING IN
THE ENTERTAINMENT INDUSTRY TO
GAIN A BETTER UNDERSTANDING OF
HOW PEOPLE PURCHASING TICKETS
FOR LIVE EVENTS AND THOSE
WORKING IN THE INDUSTRY
EXPERIENCE THE CURRENT ONLINE
TICKETING ECOSYSTEM, AS I SAID
MUCH DISCUSSION HAS BEEN HAD,
BUT TODAY WE'RE GOING TO REALLY
HOPEFULLY GET A BETTER
UNDERSTANDING OF EVERYBODY'S
EXPERIENCE AND HOW WE CAN, UH,
MAKE IT STRONGER. UH SO MY
COMMITTEE AS WELL AS SOME OF MY
MEMBER GIBSON'S COMMITTEE HAVE
WANTED TO DO THIS FOR A WHILE,
UM AND EXPLORE HOW THE INDUSTRY
OPERATES AND ITS IMPACTS ON
CONSUMERS. UM BUT TODAY WE'RE
FINALLY GETTING TO IT. UM, AND
AS YOU KNOW, LAST YEAR,
LEGISLATORS WERE ASKED TO WEIGH
IN ON SEVERAL BILLS IN THIS
COMMITTEE AND IN, UM, THE
CHAIR'S COMMITTEE RELATED TO
EVENT TICKETING. UM TWO OF THE
BILLS APPROACH CONSUMER
PROTECTION IN VERY DIFFERENT
WAYS. SO IT MADE IT HARD ON US
TO DECIDE WHAT THE BEST WAY WAS
TO PROTECT CONSUMERS. THE
COMMITTEE WORKED DILIGENTLY TO
FIND COMMON GROUND AND
COMPROMISE. UM, HOWEVER, WE
DIDN'T GET THERE, BUT WE WILL.
WE ARE OPTIMISTIC. THIS IS OUR
YEAR. SO UM, WE DECIDED TO TAKE
A STEP AWAY FROM THE SPECIFIC
BILLS AND HOLD THIS
INFORMATIONAL HEARING TO DIG
MORE DEEPLY INTO CONSUMER
PROTECTION ISSUES. THE CURRENT
ECOSYSTEM WITH THE GOAL OF A
BETTER UNDERSTANDING OF WHAT
CALIFORNIANS FACE AND UH, TO BE
CLEAR. WE WILL NOT BE DEBATING
THE MERITS OF THOSE BILLS TODAY
THAT WILL BE DONE DURING THE
REGULAR HEARINGS ON THOSE BILLS.
SO WE WANT THAT TO BE CLEAR TO
EVERYONE INVOLVED THAT WE WOULD
LIKE YOUR TESTIMONY ON THE
TICKETING ECOSYSTEM, BUT WE DO
NOT ASK YOU AT THIS TIME TO
WEIGH IN ON BILLS THAT ARE
BEFORE THE LEGISLATURE WHETHER
IT WAS THE BILLS THAT WERE HEARD
LAST YEAR, OR WE HAVE NEW BILLS
THAT HAVE BEEN INTRODUCED EVEN
THIS YEAR. UM, THAT WILL HAPPEN
BEFORE THE COMMITTEES AT THE
APPROPRIATE TIME AFTER REFERRAL,
UM OR WHEN WE HOLD A HEARING ON
THE BILL IS ALREADY SITTING IN
OUR COMMITTEE. UH, I REALLY DO
WANT TO THANK THE PANELISTS FOR
BEING HERE TODAY FOR GIVING US
YOUR TIME OUT OF YOUR BUSY
SCHEDULES. UM YOU KNOW, ONE OF
THE INDUSTRIES THAT WEIGH IN
VERY HEAVILY LAST YEAR WAS, UM
THE SPORTS TEAMS AND THEY
DECIDED NOT TO PARTICIPATE IN
TODAY'S HEARING. AND YOU KNOW,
I. I WANNA THANK THOSE THAT DID
BECAUSE FOR THOSE OF US SITTING
ON THIS COMMITTEE THAT HEARD
FROM SO MANY VOICES CHOOSING NOT
TO BE HERE TO HELP US GET GOOD
INFORMATION, I THINK SPEAKS
VOLUMES TO WHETHER FOLKS WANT US
TO ACTUALLY UNDERSTAND THEIR
PERSPECTIVE OR NOT. SO FOR THOSE
OF YOU THAT ARE HERE. THANK YOU.
UM SO WITH THAT I WANT TO TURN
OVER TO MY COLLEAGUE AS SOMEBODY
WHO EVER. GIBSON WHO CHAIRS THE
ARTS, ENTERTAINMENT AND SPORTS
TOURISM COMMITTEE FOR OPENING
REMARKS. THANK YOU VERY MUCH. UM
MADAM CHAIR. THANK YOU VERY MUCH
FOR ONE, ALLOWING US TO COME
INTO SPACE AND WORK TOGETHER AS
A RECENT APPOINTED CHAIR OF THE
ARTS, ENTERTAINMENT, SPORTS AND
TOURISM COMMITTEE. I'M EXCITED
TO BE HERE TODAY. UH I WAS NOT A
MEMBER OF THE COMMITTEE AND WHEN
THE BILL WAS HEARD LAST YEAR ON
THE ON THIS PARTICULAR TOPIC, I
VIEWED THIS AS A GREAT LEARNING
OPPORTUNITY TO BETTER UNDERSTAND
THE HISTORY OF ONLINE ACCESS TO
TICKETS TO LIVE ENTERTAINMENT.
THIS INCLUDES CONCERTS AND SHOWS
AS WELL AS TICKETS TO SPORTING
EVENTS. CALIFORNIA. IS CURRENTLY
HOME TO ABOUT 22 PROFESSIONAL
MEN AND WOMEN. MAJOR LEAGUE
SPORTS, UH, TEAMS AND IN THE
YEARS TO COME, WE WILL HOST A
NUMBER OF GLOBALLY SIGNIFICANT
EVENTS, INCLUDING THE WORLD
CUPS. WE WILL BE HOSTING THE, UM
THE SUPER BOWL AS WELL AS THE
OLYMPICS. UH, I VIEW ACCESS TO
LIVE ENTERTAINMENT. AS BEING A
MAJOR PART OF CALIFORNIA'S
EXPERIENCE. PEOPLE FROM ALL
WALKS OF LIFE CAN FIND JOY AND
INSPIRATION FROM SEEING TALENT,
UM, PERFORMS AND ATHLETES IN
PERSON. UH, THESE EVENTS CAN
HAVE A BIG IMPACT ON THE MENTAL
HEALTH AND WELLNESS AND I VIEW
THE EX EXPANDING ACCESS. UM AS
BEING A VERY IMPORTANT AND VITAL
PART OF THAT EXPERIENCE. I LOOK
FORWARD TO HEARING OF THE
VARIOUS PERSPECTIVES OF TODAY'S
PANELISTS, UM AND HEARING THEIR
VIEWS, UM, ON EXISTING ISSUES
WITH ONLINE TICKETING. UM I ALSO
WOULD LIKE TO KNOW. UM YEAH, I'D
LIKE TO KNOW THE STEPS OF BEING
THAT ARE BEING TAKEN TO IMPROVE
THE EXPERIENCE AND THE ACCESS
FOR FANS IN ATTENDANCE. UM AGAIN
. I WANNA THANK THE CHAIR FOR
ONE HOSTING THIS AND JOINTLY
WITH ME, UM, TO BOTH OF OUR
TEAMS, THANK YOU WORKING AND OUR
CONSULTANTS FOR WORKING
DILIGENTLY TO PUT THIS TOGETHER.
I BELIEVE THAT THERE WILL BE
MORE UM, IN THE COMING MONTHS TO
COME, SO THANK YOU VERY MUCH AND
LOOK FORWARD TO CARRYING A VERY
ROBUST, UM, CONVERSATION
THROUGHOUT THIS PROCESS. THANK
YOU. THANK YOU. AND I WAS REMISS
IN WAIT. WHAT DID I DO WITH IT?
NOW I LOST YOUR POST IT. I WAS
GONNA TELL THE PUBLIC HOW TO
WEIGH IN. IF I FIND MY POST IT I
WILL TELL THE PUBLIC HOW TO
WEIGH IN, UM OH, I FOUND IT.
THERE IT IS. OK SO FOR THOSE
THAT ARE NOT IN THE ROOM OR WANT
TO PROVIDE WRITTEN COMMENTS, UM,
THE PRIVACY COMMITTEE EMAILED TO
DO SO IS A P. èC P DOT
COMMITTEE AT ASSEMBLY DOT CæA
DOT GOV OR ON OUR WEBSITE ÁP èC
P DOT ASSEMBLY DOT èC DOT GOV
SO WE'LL BE TAKING PUBLIC
COMMENT HERE TODAY. BUT YOU CAN
ALSO SUBMIT IT ON OUR WEBSITE SO
WE CAN KNOW WHAT YOU THINK. UM
AND THANK YOU TO THE CHAIR FOR
HIS COMMENTS. I KNOW, UM GROWING
UP IN CALIFORNIA. AND I WON'T
SAY WHAT BASEBALL TEAM BECAUSE
NOW I LIVE ON THE OTHER SIDE OF
THE BAY. UM BUT YOU KNOW THESE
THESE SPORTS EVENTS, THESE
CONCERTS WE ALL REMEMBER OUR
FIRST CONCERT, OR, UM, INTEGRAL
PART TO OUR FAMILIES AND OUR
COMMUNITIES, AND IT'S A HUGE
DRIVER AS WE ALL KNOW OF OUR
ECONOMIES, BOTH IN SOUTHERN
CALIFORNIA AND IN NORTHERN
CALIFORNIA, SO THIS IS A REALLY
IMPORTANT CONVERSATION TO MAKE
SURE THERE'S RESOURCES ARE IN
OUR COMMUNITIES AND BEING USED
IN AN IMPORTANT WAY. UM TO
EITHER OF DO ANY OF THE MEMBERS
WANT TO WEIGH IN AT THIS POINT,
WE WILL HAVE MORE TIME, OK? SO
WE'LL GO TO OUR FIRST PANEL. UM
WHICH IS OVERVIEW OF THE LIVE
ENTERTAINMENT TICKETING MARKET.
AND WE HAVE DR HEMANT BVA, OR
ARE YOU HERE? PERFECT JOIN US UP
HERE, DISTINGUISHED PROFESSOR AT
UC DAVIS GRADUATE SCHOOL OF
MANAGEMENT. AND HE IS GOING TO
GIVE US AN OVERVIEW OF THE
TICKETING MARKET WHEN YOU'RE
READY, SIR. ALL RIGHT. THANK YOU
FOR INVITING ME HERE, AND IT'S
AN HONOR TO PARTICIPATE IN AND
CONTRIBUTE TO OUR METHOD OF
GOVERNANCE. UM AND THANK YOU,
CHAIRMAN BAUER-KAHAN AND CHAIR
GIBSON AND JULIE SALLIER ASKING
ME TO COME HERE. UM I JUST WANT
TO START WITH A COUPLE OF
DISCLAIMERS. SO FIRST OF ALL,
OBVIOUSLY I SPEAK FOR MYSELF,
NOT FOR THE UNIVERSITY AND NOT
FOR ONE OF MY CHILDREN WHO'S IN
MUSICAL THEATER IN NEW YORK
CITY. AND UH, YOU KNOW, AS AN
ACADEMIC THIS ENTERTAINMENT
TICKETING IS NOT MY NUMBER ONE
FOCUS. IT'S PROBABLY THE FIFTH
OR SIXTH THING THAT WOULD BE ON
MY LIST. BUT I DO A NUMBER OF
THINGS THAT I STUDY THAT. I
THINK. RELATE TO THE FUNDAMENTAL
ECONOMIC FORCES AND
TECHNOLOGICAL ELEMENTS THAT
AFFECT HOW THIS INDUSTRY
FUNCTIONS AND SO I'M GOING TO
TAKE SOME OF MY TIME TO REALLY
LINK WHAT'S HAPPENING IN THE
ENTERTAINMENT TICKETING INDUSTRY
TO THESE BROADER UH, ASPECTS OF
TECHNOLOGICAL CHANGE. I SHOULD
ALSO MENTION THAT I THINK ALL OF
YOU HAD ACCESS TO THE EXCELLENT
BACKGROUND REPORT THAT JULIE,
UH, PREPARED AND SENT TO ME. AND
SO I WILL TRY NOT TO REPEAT FROM
THAT, THOUGH. THERE ARE A COUPLE
OF THINGS THAT ARE WORTH LAYING
OUT, UM, TO SET THE STAGE. AND
THEN, AS I MENTIONED, I WILL
CONNECT WITH OTHER RELATED
INDUSTRIES THAT I THINK HAVE
SIMILAR ELEMENTS WHICH YOU MIGHT
BE FAMILIAR WITH. THAT INCLUDES
AIRLINE INDUSTRY. UM
TELECOMMUNICATIONS AND IN HOME
VIDEO, ENTERTAINMENT STREAMING
AND OTHER TYPES OF ENTERTAINMENT
SERVICES. AND SO WHAT I'M GONNA
DO FOR THE NEXT 1520 MINUTES IS,
UM GIVE YOU A LITTLE BIT OF
OVERVIEW OF THE INDUSTRY
COVERING BOTH PRIMARY AND
SECONDARY MARKETS AND SOME OF
THE PROBLEMS THAT WE ALL KNOW
EXIST. THEN I'LL TAKE YOU A
LITTLE BIT THROUGH ANALYSIS OF
THE PRIMARY MARKET TO UNDERSTAND
HOW WE GOT HERE. RIGHT AND
BECAUSE I THINK THAT WILL BE
RELEVANT TO THINKING EVENTUALLY
ABOUT HOW TO FIX SOME OF THE
PROBLEMS THAT EXIST, AND THEN I
WILL TRY TO DO A SIMILAR THING
ABOUT THE SECONDARY MARKET,
RIGHT. SO UM, LET'S BEGIN WITH
THAT, AND I HAVE A FEW SLIDES,
WHICH, UM, I THINK I DON'T WANT
YOU ALL TO STRAIN YOUR NECK
TURNING BACK, BUT THEY ARE
BEHIND YOU. AS FAR AS I CAN SEE,
UH, SO NEXT ONE NEXT ONE,
PLEASE. UM SO I JUST GIVE YOU A
LITTLE BIT OF AN OVERVIEW OF
WHAT THE DIFFERENT PLAYERS ARE.
AND I THINK THIS IS SOMETHING
YOU WOULD ALL KNOW. AND FROM THE
BACKGROUND READING AS WELL. AH,
BUT BASICALLY, I THINK THE POINT
I WANT TO MAKE IF YOU LOOK AT
THE PLAYERS INVOLVED THE ARTIST
PROMOTERS WHEN YOU TICKET
SELLERS AND ULTIMATELY FANS IS
THAT IF YOU LOOK AT ESPECIALLY
THE FIRST TOP FOUR PARTS OF THIS
STACK THE THERE'S CODEPENDENCE
AMONG ALL OF THESE ENTITIES
RIGHT? THEY ALL DEPEND ON EACH
OTHER TO CREATE VALUE IN THE
INDUSTRY, AND NONE OF THEM
REALLY WOULD BE ABLE TO DO MUCH
WITHOUT THE OTHERS. SO ARTISTS
DON'T REALLY HAVE VENUES. THEY
DON'T KNOW HOW TO SELL TICKETS.
AND SO THERE ARE ALL THESE OTHER
DETAILS OF CO DEPENDENCE THAT
ARE QUITE RELEVANT. AND I'M
GOING TO SKIP THE PROMOTER PART
HERE BECAUSE IT'S REALLY FROM MY
PERSPECTIVE. IT'S MORE ABOUT
RISK MANAGEMENT IN THE INDUSTRY
AND THE REMAINING THREE UM TYPES
OF FIRMS ARE ON THE SUPPLY SIDE
THAT I WILL FOCUS ON. AND OF
COURSE, WE'RE LOOKING AT FANS OR
CONSUMERS AND THE IMPACT THAT
THAT ALL OF THESE THINGS HAVE ON
CONSUMER. UH UH, UH, WELFARE AND
OTHER ISSUES. IT'S ALSO
IMPORTANT TO NOTE THAT IN IN
WHAT THESE PLAYERS BRING TO THE
MARKET, THERE ARE A LOT OF WHAT
WE CALL COMPLEMENTARY GOODS
ASPECT. SO WHEN AN ARTIST GOES
AND PERFORMS AT A VENUE, THERE
IS POTENTIAL TO MAKE ADDITIONAL
SALES OR REVENUE FROM ALL THE
WAY FROM PARKING TO CONCESSIONS
TO MERCHANDISE AND A VARIETY OF
OTHER THINGS, BESIDES BRAND
BUILDING AND SO FORTH, SO THAT
ONE ACT LEADS TO OTHER
INTERCONNECTED SOURCES OF
REVENUE. SO AS WE GO FORWARD IN
THIS, I THINK IT'S IMPORTANT TO
KEEP IN MIND THAT THERE ARE SOME
ECONOMIC CHARACTERISTICS THAT
DRIVE HOW WHAT OUTCOMES ARE
FOUND IN THESE MARKETS. THE
FIRST AT THE ARTISTS LEVEL IS
THAT THESE ARE PRODUCTS OR, YOU
KNOW THESE ARE THINGS THAT VERY
HIGH FIXED COSTS. IT TAKES A LOT
TO CREATE A SHOW, RIGHT? AND I
THINK WHAT I'M GOING TO SAY IS
NOT TRUE FOR LIVE SPORTS, BUT
IT'S TRUE FOR THE OTHER, UH,
PERFORMING ARTS EVENTS THAT
THESE ARE THINGS WITH HIGH FIXED
COSTS AND RELATIVELY LOWER
VARIABLE COST. SO THERE IS OF AN
INTENT OR A DESIRE TO REPEAT.
THE EVENT RIGHT, WHICH MEANS IT
WOULD HAVE TO GO ACROSS MULTIPLE
VENUES AND PERHAPS INTERACT WITH
MULTIPLE TICKETS SELLING. UH UH,
UH, SYSTEMS. AND OF COURSE,
THAT'S NOT TRUE FOR LIVE SPORTS,
BECAUSE EVERY EVERY SPORTS EVENT
IS UNIQUE. UH, THESE ARE ALSO
PERISHABLE GOODS FROM THE
PERSPECTIVE OF VENUES AND TICKET
SELLERS IN PARTICULAR ONCE THE
DATE OF THE EVENT OCCURS OR IS
PASSED. THAT REMAINING SEAT HAS
ZERO VALUE AT THAT POINT, AND SO
THAT IN THE INDUSTRY AND THIS IS
TRUE FOR MANY OTHER INDUSTRIES
CREATES A NEED FOR WHAT'S CALLED
DYNAMIC PRICING RIGHT. THAT
PRICE IS OVER TIME. AND IN
PARTICULAR, THAT THEY ARE THE
SELLERS ARE THOSE WHO DETERMINED
TO GET PRICES OFTEN CHANGE THE
PRICE OF THE SAME. PRODUCT THE
SAME SEAT DEPENDING ON THE
AMOUNT OF SUPPLY AND DEMAND
THAT'S STILL REMAINING OR ARE
EXPECTED. AND, FOR INSTANCE, WE
SEE THAT AND SEEM TO HAVE NÓ
TROUBLE WITH SEEING THAT IN THE
AIRLINE INDUSTRY, RIGHT, WHICH
WAS ONE OF THE EARLIEST
PRACTITIONERS OF VERY INTENSIVE
DYNAMIC PRICING TECHNIQUES,
WHICH ARE ALSO CALLED REVENUE
MANAGEMENT IN THE INDUSTRY. UM
THE FACT THAT THERE IS THIS, YOU
KNOW, PERISHABLE GOODS AND
DYNAMIC PRICING ALSO MEANS THAT
THERE IS A NEED FOR ADVANCED
SELLING. THE TICKETS ARE SOLD
WELL IN ADVANCE OF THE EVENT
DATE. AND FOR SUCH PRODUCT
SERVICES RIGHT ENTERTAINMENT
GOODS. THIS CREATES A LOT OF
UNCERTAINTY AMONG THOSE WHO ARE
BUYING TICKETS AHEAD OF TIME
BECAUSE FOR A SPORTS EVENT, I
MAY BUY A TICKET TO A FINAL
THINKING IT'S GOING TO BE
BETWEEN TEAMS AND B. BUT IF
THOSE TEAMS DON'T SHOW UP IN THE
FINAL, IT MAY CHANGE MY VALUE
DRASTICALLY AND MAYBE LOWER IT,
AND YET IT MAY INCREASE VALUE
FOR SOMEONE ELSE IN IN THE
MARKET, AND SO THIS CREATES A
NEED FOR A RESALE MARKET. GIVEN
THAT PEOPLE BUY AHEAD OF TIME
AND HAVE OTHER EXIGENCIES THAT
CAUSE THEM NOT TO ATTEND, OR
THEIR VALUE CHANGES OVER TIME.
THERE IS A NEED FOR A VERY
ROBUST RESALE MARKET, WHICH WE
CANNOT AVOID. AND FINALLY, OF
COURSE, IN A IN MOST VENUES WITH
A FEW 1000 SEATS OR HUNDREDS OF
100,000 SEATS, YOU'RE GOING TO
HAVE A LOT OF VARIATION AND
VALUE AMONG CUSTOMERS AND SO
THAT THAT CREATES AN OPPORTUNITY
FOR WHAT IS OFTEN CALLED SECOND
DEGREE PRICE DISCRIMINATION,
MEANING DIFFERENTIAL PRICES ARE
PAID BY PEOPLE BASED ON WHAT
KIND OF SEE OR EXPERIENCE THAT
THEY GET. NOW, WITH ALL OF THIS,
I THINK WE KNOW THAT THERE ARE A
NUMBER OF PROBLEMS THAT OCCUR IN
THIS INDUSTRY. THEY RANGE ALL
THE WAY FROM UH, FOR INSTANCE,
ITS INTERACTION BETWEEN PRIMARY
AND SECONDARY MARKETS THAT THERE
IS, UM A LOT OF SCALPING OR
PROFIT, UH, TAKING IN THE RESALE
MARKET, BECAUSE, UM, ONE OF THE
YOU KNOW WHAT SOME MIGHT
CONSIDER IRRATIONAL ELEMENTS OF
THESE EVENTS IS THAT ARE SO I
TALK TO YOU ABOUT DYNAMIC
PRICING AND ADVANCE SELLING,
WHICH MEANS THAT PRICES FOR THE
SAME ITEM CAN VARY WIDELY DURING
THE SELLING PERIOD. BUT IN ARTS
AND ENTERTAINMENT VERY OFTEN,
ARTISTS DO NOT WANT TO BEHAVE
LIKE A TRADITIONAL COMMERCIAL
PRODUCT, LIKE AN AIRLINE THAT
MAY PRICE THE TICKET FOR $100.01
DAY AND 1200 AT A DIFFERENT TIME
. RIGHT AND ARTISTS TEND NOT TO
DO THAT, BUT THAT, GIVEN THAT
THERE IS A RESALE MARKET, IT
CREATES NATURALLY CREATES AN
OPPORTUNITY FOR EXTRACTING THOSE
HIGHER PRICES IN IN THE RETAIL
MARKET. UM. OTHER THINGS THAT
YOU SEE. OF COURSE, THERE ARE
TECHNOLOGICAL PROBLEMS, AND
THAT'S WHAT HAPPENED LAST YEAR.
UH WITH THE TAYLOR SWIFT, UH,
SALES, BUT ALSO IF YOU LOOK AT
THE VERY TOP OF THE PICTURE
TICKETS SOMEONE MIGHT BE LOOKING
FOR TICKETMASTER TO BUY TICKETS,
BUT THEY MISS TYPE. THE NAME IN
THE SEARCH ENGINE, AND THEY
COULD VERY WELL BE LED TO A FAKE
SITE. IT IS ALSO THE CASE VERY
OFTEN THAT, UM CUSTOMERS WHO
LOOK FOR A SELLING SIDE BY
BEGINNING THEIR ACTION ON A
SEARCH ENGINE COULD BE LED TO
SITES THAT ARE DECEPTIVE OR NOT,
OR OTHERWISE SELL NON REAL
TICKETS. SO INSTEAD OF BEING
TAKEN TO, UH, THE CORRECT SITE,
WHICH COULD BE THE THEATER VENUE
TICKET MASTER, THEY'RE OFTEN LED
TO OTHER, UH, SITES, AND
OBVIOUSLY, THAT'S NOT THE FAULT
OF PROBABLY ANY OF THE PLAYERS
IN THIS ROOM, BUT IT'S PART OF
IT'S A PROBLEM THAT EXISTS RIGHT
, SO THERE ARE A NUMBER OF KNOWN
ISSUES THAT ARE A PROBLEM.
THERE'S OF COURSE, TREMENDOUS.
BUYING BY BOTS AND BROKERS
BECAUSE ANOTHER I RUSH, POSSIBLY
IRRATIONAL CHARACTERISTICS IS
THAT ARTISTS LOVE IT WHEN A SHOW
IS SOLD OUT ON THE FIRST DAY.
RIGHT AND BECAUSE OF THAT,
BETWEEN THE ARTISTS AND THE
SELLERS THAT ARE OFTEN YOU
OVERLOOK, UH, ELEMENTS THAT LEAD
TO THOSE SAME DAY, YOU KNOW, ONE
DAY SALES. AND SO IF IT BROKERS,
OUR TICKET BOTS ARE BUYING ALL
OF THE TICKETS. THAT'S TOTALLY
FINE, UH, WITH SOME PARTS OF THE
INDUSTRY AND THOSE TICKETS, THEN
EVENTUALLY GET SOLD AGAIN IN THE
RESALE MARKET. ALL RIGHT, SO LET
ME TAKE YOU THROUGH A LITTLE BIT
OF YOU KNOW WHERE HOW WE GOT TO
THIS POINT WITH ALL OF THESE
PROBLEMS THAT EXIST AND IF YOU
CAN GO ON TO THE NEXT SLIDE,
PLEASE. SO I WANT YOU TO STEP
BACK. MAYBE A FEW DECADES AGO
WHERE WE LIVED IN A WORLD WHERE
WE DID NOT HAVE ALL THE
DIGITIZATION INTERNET DEVICES
THAT WE SEE TODAY, RIGHT? AND
THIS IS THE WORLD IN WHICH,
BASICALLY, IF YOU THINK OF THE
NATIONAL MARKET FOR
ENTERTAINMENT TICKETING. IT WAS
BASICALLY A COLLECTION OF A
NUMBER OF LOCAL MARKETS. RIGHT
SO IF YOU LOOK THINK ABOUT THE
LAYERS THAT I DEPICTED TO YOU ON
THE FIRST SLIDE, THERE ARE
ARTISTS, VENUES, TICKET SELLERS
AND THEN ULTIMATELY, FANS.
INTERACTIONS WERE GENERALLY
CONTAINED WITHIN LOCAL
GEOGRAPHICAL REGIONS, RIGHT UM
AND THAT'S TRUE FOR FANS WHO
COULDN'T REALLY GO 500 MILES OR
OR DISCOVER EVENTS THAT WERE
HAPPENING FAR AWAY, AND VENUES
WERE MORE INDEPENDENT AND OWNED
AND OPERATED. ART IS, OF COURSE,
IF YOU REMEMBER WHAT I TOLD YOU
ABOUT HIGH FIXED COSTS, LOW
REPETITION COSTS THAT THEY
ALWAYS HAVE A DESIRE TO PERFORM
THE SAME EVENT MULTIPLE TIMES,
AND THIS IS PARTICULARLY TRUE
FOR MORE POPULAR. UM ARTISTS
MORE RICH, OTHERWISE MORE, YOU
KNOW, THOSE ABLE TO PERFORM AN
EVENT MULTIPLE TIMES, WHICH
MEANT THAT AT THE TOP LAYER,
EVEN THOUGH THIS IS A LOT OF
LOCAL MARKETS AT THE VERY TOP
LAYER, THERE IS A DESIRE TO GO
ACROSS LOCAL REGIONS, RIGHT AND
IF WE GO BACK A DECADES AGO.
CROSS LOCAL CROSS LOCAL MARKET
TRANSACTION COSTS WERE EXTREMELY
HIGH. SO IF YOU'RE AN ARTIST IN
THE SACRAMENTO REGION WHO WANTS
TO PERFORM IN LOS ANGELES OR
CHICAGO OR PHILADELPHIA, YOU
INCUR SUBSTANTIALLY HIGH COST
EVERY TIME YOU WANT TO CONTRACT
NEGOTIATE, SET UP THE STAGE,
SELL TICKETS OR BE DISCOVERED,
RIGHT? AND SO THE DESIRE BY
ARTISTS TO REPEAT THEIR SHOWS.
ALSO CREATES A DESIRE TO SEE
SOME KIND OF CONSOLIDATION IN
THE NEXT LAYER AND THE NEXT
LAYER BECAUSE IF YOU ONLY HAVE
TO TRANSACT WITH ONE ENTITY FOR
10 SHOWS, THAT'S A LOWER
TRANSACTION COST. AND WE SAW
THIS. OF COURSE, IF YOU GO BACK
120 YEARS AGO IN THE ERA OF
VAUDEVILLE IT WAS PRETTY COMMON
FOR VAUDEVILLE PERFORMERS TO
LOOK FOR, UH, THERE WAS SO
CALLED BOOKING AGENCIES THAT
THAT ARRANGED FOR THEIR SHOWS TO
BE PERFORMED AT A NUMBER OF
LOCATIONS. AND OF COURSE, WE
KNOW THEY WERE THE SAME THEATER
CHAINS THAT EXISTED EVEN BACK IN
120 YEARS AGO AROUND 919 100
THAT CONSOLIDATED MULTIPLE
THEATERS RATHER THAN EACH
THEATER BEING INDEPENDENTLY
OWNED AND OPERATED. RIGHT SO
THIS IS WHERE WE BEGAN THIS
INDUSTRY AND TICKETS. SELLING
THEREFORE WAS BASICALLY LOCAL
OPERATION. A LOT OF VENUE SOLD
THEIR OWN TICKETS AND THEN OVER
TIME. IT STARTED SPREADING OUT
TO OTHER RETAIL LOCATIONS WHERE
YOU COULD BUY TICKETS FOR A
SHOW. SO LET'S GO FORWARD NOW IN
TIME. AND. PARTICULARLY AS I
SAID THE DESIRE FOR UH UH,
ARTISTS TO EXHIBIT ACROSS
MULTIPLE LOCATIONS MEANT THAT
THERE WAS SOME CONSOLIDATION
ALREADY HAPPENING AT THE VENUE
AND TICKET SELLING LAYERS, RIGHT
AND WHAT YOU SELL AT THE TICKET
SELLING LAYER WAS EMERGENCE OF
COMPANIES LIKE TICKET TR AND
THEN EVENTUALLY TICKET MASTER
AND, UM, IN THE BEU LAYER. WE
SAW EMERGENCE OF FIRMS THAT
BOUGHT MULTIPLE VENUES ARE
ARRANGED TO HOST EVENTS AT
MULTIPLE VENUES AND COMPANIES
LIKE LIVE NATION ENTERTAINMENT
THAT CAME ABOUT AT THAT LAYER.
NOW, IF YOU LOOK AT THE TIME OF
EXTREME DIGITIZATION, WHERE WE
GOT PERSONAL COMPUTERS, HIGH
SPEED INTERNET AND THEN
EVENTUALLY MOBILE DEVICES AND SO
FORTH THAT THAT LEADS TO THE
EROSION OF THOSE LOCAL WALLS
RIGHT SO THOSE WALLS THAT WERE
FAIRLY SHARP AT THE LOWER LAYERS
ARE NOW DISSIPATING. UM AND
THEREFORE BECAUSE ARTISTS CAN
NOW PERFORM IT MORE VENUES.
THERE'S EVEN A GREATER FORCE TO
GET CONSOLIDATION IN THE LOWER
LAYERS. RIGHT SO NOW YOU GET
COMPANIES THAT WERE SELLING
TICKETS COVERING MANY MORE
MARKETS BECAUSE FANS CAN NOW
DISCOVER EVENTS, DIFFERENT
REGIONS, YOU KNOW, BECAUSE OF
THE INTERNET, AND PERHAPS
BECAUSE OF LOWER AIRLINE PRICES,
THEY COULD TRAVEL OCCASIONALLY
TO EVENTS AT OTHER LOCATIONS, SO
THIS LOCAL MARKETS STARTED
GRADUALLY BREAKING AWAY. BUT I
WOULD LIKE TO MENTION HERE THAT
IF YOU THINK OF THE STATE OF THE
MARKET TODAY, IT'S NOT LIKE THE
LOCAL BOUNDARIES HAVE GONE. AND
WE SHOULD REALLY THINK OF WHAT'S
HAPPENING TODAY IN TERMS OF TWO
VERY DIFFERENT MARKETS, WHAT
WOULD BE THE EQUIVALENT OF SMALL
AND MEDIUM ENTERPRISES, RIGHT?
THE SMALLER THEATERS, SMALLER
ARTISTS. DO THEIR OWN. THEY
STILL EXIST IN A LOCAL WORLD,
AND THEY OFTEN HAVE TICKETS
SELLING THROUGH SIMILAR METHODS
THAT THEY USE 34 YEARS AGO AND
THEN FOR THE LARGER SHOWS MORE
POPULAR SHOWS LARGER VENUES. WE
REALLY ARE LOOKING AT A MORE, UH
, NATIONAL OR AT LEAST LARGER,
REGIONAL, UH, SET OF MARKETS
RIGHT? AND SO THAT'S ONE OF THE
FORCES THAT LEADS TO
CONSOLIDATION AT THE HORIZONTAL
LEVEL. SO FEW FIRMS THAT CONTROL
VENUES, FEW FIRMS THAT CONTROL
TICKETING. NOW ONE OF THE OTHER
THINGS THAT WE HAVE SEEN IN THIS
INDUSTRY IN THE LAST 15 YEARS IS
ALSO VERTICAL INTEGRATION THAT
YOU SEE COMBINATIONS OF FIRMS
THAT OPERATE AT DIFFERENT LAYERS
. AND SO I THINK THAT'S WHERE
THE MERGER BETWEEN LIVE NATION
ENTERTAINMENT, WHICH OPERATED AT
THE VENUE LEVEL IN TICKETMASTER
THAT WAS PREDOMINANTLY A TICKET
SELLING BRINGS YOU AN ENTITY
THAT CAN ARRANGE SHOWS AND TAKE
YOU THROUGH ALL OF THE STEPS
THAT ARE NEEDED TO PUT AN ARTIST
INTO A VENUE AND OR IN FRONT
FRONT OF FANS. UM ALL RIGHT, SO
LET'S GO FORWARD. ALL RIGHT, AND
. SO WE DO GET SOME EFFICIENCIES
BECAUSE OF THESE VERTICAL
INTEGRATION, AND I THINK THIS
THIS IS PROBABLY SOMETHING YOU
MOST OF YOU KNOW THAT IN THE U
S¼ FOR THE LAST 50 YEARS OF ANTI
COMPETITIVE AND ANTI TRUST
ACTIONS, VERTICAL MERGERS HAVE
GENERALLY BEEN VIEWED POSITIVELY
BECAUSE THEY DO CONTRIBUTE TO
SOME REDUCTION IN INEFFICIENCIES
WHAT WE OFTEN CALL DOUBLE OR
MULTIPLE MARGINALIZATION.
HORIZONTAL MERGES, ON THE OTHER
HAND, ARE USUALLY VIEWED AS RED
REDUCTION IN COMPETITION, RIGHT,
BUT IF I GO BACK FOR A MOMENT TO
THE PICTURE, I JUST SHOWED YOU.
THESE ARE MARKETS IN WHICH
YOU'RE BOTH COMPETING
HORIZONTALLY AGAINST EACH OTHER.
BUT YOU'RE ALSO COMPETING FOR
THE SHARE OF THE DOLLAR THAT A
CUSTOMER SPENDS. YOU'RE
COMPETING VERTICALLY FOR EVERY
DOLLAR THAT A CUSTOMER SPENDS.
HOW MUCH DOES AN ARTIST GET? HOW
MUCH DOES THE VENUE GET? WHAT
DOES THE TICKET SELLER TAKE?
THAT DEPENDS ON THE DEGREE OF
HORIZONTAL CONSOLIDATION AT EACH
LAYER, SO IF THE TICKETING LAYER
IS VERY CONCENTRATED, THEY GET
MORE MARKET POWER. IF THE ARTIST
LAYER WERE TO BE VERY
CONCENTRATED, THEY WOULD GET
MORE MARKET POWER AND I'VE DONE
A LOT OF WORK, FOR INSTANCE, IN
IN HOME ENTERTAINMENT, WHERE
TODAY WHEN WE CONSUME TELEVISION
AND MOVIE, AH, ENTERTAINMENT OR
FOR THE LAST SEVERAL DECADES,
RIGHT, MOST CONTENT WAS OWNED
AND RUN BY A FEW CONTENT FROM
STUDIOS AND PROGRAMMING
NETWORKS. SO THOSE ARE THAT'S A
SETTING WHERE THE ARTIST SLAYER
PRODUCTION LAYER HAS STRONG
MARKET POWER. THEY ARE ALL
OLIGOPOLIES, AND IN FACT, IN
THAT INDUSTRY, WE OFTEN SAY
CONTENT IS KING. RIGHT BUT EVEN
IN A SETTING WHERE THE CONTENT
LAYER IS STRONG, WE ALSO SAY
DISTRIBUTION IS GOD. RIGHT, SO
THE DISTRIBUTION LAYER IS
ULTIMATELY HOW THE PRODUCT GETS
TO THE CUSTOMER, AND THEREFORE
THEY THEY ALWAYS RETAIN SOME
MARKET POWER. AND IF THE
DISTRIBUTION TICKETING LAYER IS
HIGHLY CONSOLIDATED, THEN THAT
LEADS TO A NATURAL ELEMENT OF
INCREASED BARGAINING POWER IN
THE VERTICAL MARKET, ALL RIGHT,
AND YOU MIGHT ASK WHY THERE
AREN'T MULTIPLE TICKET SELLERS
OR WHY WHY DO ONE OR TWO FIRMS
CONTROL A LOT OF THE TICKETING
MARKET FOR ENTERTAINMENT?
BECAUSE AGAIN IF WE GO BACK TO
THE AIRLINE INDUSTRY TO IN HOME
VIDEO ENTERTAINMENT. FEW OTHER
INDUSTRIES. YOU NOTICE THAT
THERE ARE MULTIPLE SYSTEMS THAT
STILL OPERATE RIGHT? YOU BUY
DISNEY. PLUS YOU GET NETFLIX YOU
GET èC B S¼ PARAMOUNT. SO THERE
ARE A NUMBER OF FIRMS THAT, UH,
ARE VYING FOR THE CUSTOMER'S
ATTENTION. AND IN FACT, IN MANY
OF THOSE CASES, YOU SEE THE
ARTIST THE PRODUCTION LAYER.
CONNECT DIRECTLY WITH THE
CUSTOMER. THAT'S WHAT YOU KNOW
DISNEY PLUS, WHICH WAS A MADE
CONTENT ACTUALLY SELLS CONTENT
TO THE CUSTOMER. AIRLINES
DISTRIBUTE TICKETS THROUGH
EXPEDIA AND OTHER AGENCIES, BUT
THEY ALSO SELL TICKETS THROUGH
THEIR OWN WEBSITE. RIGHT IN THIS
INDUSTRY. THAT'S A LOT HARDER TO
ACCOMPLISH, BECAUSE THE ARTIST
LAYER IS EXTREMELY FRAGMENTED.
UH I DON'T THINK TAYLOR SWIFT
WOULD LOVE TO MARCH WITH
BEYONCE, FOR INSTANCE AND CREATE
A BIG ARTIST COMPANY. ALL RIGHT.
SO THIS IS WHY YOU SEE THIS KIND
OF STRUCTURE IN THE INDUSTRY AND
I THINK THIS IS IT'S ONE OF THE
REASONS WHY YOU CANNOT HAVE TOO
MANY TICKETING FIRMS IN IN THAT
LOWEST LAYER, ALL RIGHT. AND
THAT LEADS TO SOME NEGATIVE
CONSEQUENCES. I WAS TRYING TO
SHOW IN THE NEXT SLIDE, AND
THESE ARE THE HARMS THE FAULT
LINES THAT ARE DISPLAYED TO YOU
EARLIER, BUT YOU COULD ARGUE
THAT THE LACK OF COMPETITION AT
THE TICKETING LAYER MAKES THE
OPERATORS LESS EXCITED ABOUT
SOLVING THE PROBLEMS RIGHT. LESS
COMPETITION GENERALLY LEADS TO
LOWER INNOVATION. THIS IS
SOMETHING WE SAW IN YET ANOTHER
TIME, IF YOU THINK OF CHAD GP Tð
THAT WAS RELEASED BY OPEN A I
FOR 20 YEARS, GOOGLE WAS A
DOMINANT SEARCH ENGINE AND, TO
SOME EXTENT THAT THROTTLE THE
AMOUNT OF INNOVATION THAT GOOGLE
DID AND WHAT IT MIGHT HAVE DONE
IF IT WERE IN A HIGHLY
COMPETITIVE SEARCH INDUSTRY. OK
SO MAYBE LET ME, UH, JUST GO ON.
GO ON FORWARD. I'M SORRY. NEED
TO MAJOR QUESTIONS IN JUST A
COUPLE OF MINUTES? ABSOLUTELY SO
I'M JUST GONNA END WITH A LITTLE
BIT OF CONVERSATION ABOUT THE
SECONDARY MARKET ON THE NEXT
SLIDE, PLEASE. NEXT MONTH. YEAH
AND SO THIS IS A GAME WHERE WE
KNOW THAT, UM UM PEOPLE HAVE TO
RESELL. WE WOULD OFTEN THINK OF
THE RESALE MARKET AS A CUSTOMER
TO CUSTOMER SELLING PROCESS IN
50 YEARS AGO, PEOPLE WOULD SHOW
UP IN FRONT OF A SHOW AND THEN
SELL THEIR OWN TICKET. TODAY YOU
HAVE ONLINE MARKETPLACES THAT
ENABLE THAT BUT ALSO YOU HAVE A
LOT OF MIDDLEMEN OR BROKERS THAT
THAT SAY THAT INTERMEDIATE ROLE
SO IT'S NOT NECESSARILY A
CONSUMER TO CONSUMER SETTING.
AND THEN YOU HAVE SOME OF THE
OTHER ISSUES OF ILLEGITIMATE
SALES, YOU KNOW, REPEAT SALES
COULD BE DUPLICATED AND FAKED.
THERE ARE SETTINGS WHERE IF
ENTITIES LIKE TICKET MASTER ALSO
GET INVOLVED IN THE RESALE
MARKET THEY CAN CONTROL SOME OF
THAT FRAUD MORE EFFECTIVELY THAN
IF IT WERE OTHER ENTITIES DOING
THAT, SO I'LL BE HAPPY TO TAKE
QUESTIONS HERE AND WE CAN DO
OTHER THINGS. THANK YOU. I CAN
START UNLESS SOMEBODY ELSE WANTS
TO START, SO LET'S START WITH
SOLUTIONS. UM I'M CURIOUS TO
KNOW WHAT YOU THINK WE SHOULD BE
THINKING ABOUT IS IT RELATES TO
YOU'VE LAID OUT SOME OF THE
PROBLEMS. OBVIOUSLY, WE AREN'T
IN THE ANTITRUST BUSINESS, SO
THAT'S NOT SOMEWHERE WE CAN
CORRECT, NECESSARILY. BUT, UM.
BOTH AND I WOULD SAY BOTH FROM A
GOVERNMENT PERSPECTIVE AND A
TECH PERSPECTIVE. YOU KNOW, AS I
WAS READING THE BACKGROUND OR
ABOUT BOTS, ONE OF THE QUESTIONS
THAT CAME TO MIND AND YOU MAY
HAVE JUST ANSWERED THIS BY
TALKING ABOUT THE LACK OF
INNOVATION DUE TO CONSOLIDATION
IS WHY AREN'T THERE BETTER? TECH
SOLUTIONS TO STOP THE BOTS
RIGHT? THE GOVERNMENT IS DOING
WHAT IT CAN. BUT WITH THE
BRILLIANT TECH MINDS IN THIS
STATE AND ELSEWHERE, IT SEEMS
LIKE WE SHOULD BE ABLE TO DO
MORE TO STOP THE BOTS. ALL
RIGHT, LET ME SEE WHICH OF THOSE
I CAN ANSWER, AND I'LL TRY TO
MAINTAIN SOME SEQUENCE. UM THERE
ARE A FEW THINGS I WANT TO SAY.
AND MAYBE I WILL. IF YOU WOULD
INDULGE ME GIVE YOU A DIFFERENT
SO A SOLUTION IN DIFFERENT
INDUSTRY TO MOTIVATE THE
ARGUMENT THAT I'M TRYING TO
MAKE, AND TWO YEARS AGO, I THINK
THERE WAS A HEARING HERE ON
CHILD PROTECTION ONLINE. AND
THIS WAS ALSO THE SUBJECT OF
COURSE OF SENATE HEARINGS A
COUPLE OF WEEKS BACK, AND
GENERALLY IF I HEARD THE HEARING
HERE, AND THE IDEAS THAT WERE
CIRCULATED, AND WHAT IN SEVERAL
OF THE BILLS THAT ARE IN FRONT
OF THE U S¼ SENATE RIGHT NOW.
AND GENERALLY WHEN THE EFFORT.
WHEN YOU LOOK AT SOLVING SUCH
PROBLEMS IS TO TRY TO TIE THE
ARMS AND FEET OF THE FIRMS THAT
OPERATE RIGHT, SO THEY WERE
EXAMPLES SUCH AS ALGORITHMS THAT
PUSH CONTENT TO CHILDREN SHOULD
BE CONSTRAINED RIGHT, THOUGH IT
WOULD BE DIFFICULT TO KNOW
EXACTLY WHICH ALGORITHMS AND
WHEN WHO EXACTLY IS A CHILD
RIGHT? THERE ARE WAYS TO FAKE
THAT, OR WHAT KIND OF CONTENT
MAY BE CONSIDERED PERMISSIBLE OR
NOT PERMISSIBLE. AND SO THERE
ARE A NUMBER OF SOLUTIONS OF
THAT FORM THAT HAVE BEEN
PROPOSED, YOU KNOW DIGITAL
CURFEWS BANNING TARGETED
ADVERTISING, ALL OF WHICH TRIED
TO CONSTRAIN THE HANDS OF THE
PLAYERS. AND I HAVE JUST BEEN
PROPOSING AN ALTERNATIVE
SOLUTION TO THAT. SO I'M GOING
TO SHARE THAT BECAUSE I'M GOING
TO ARGUE FOR A SIMILAR THING
OVER HERE. AND THE SOLUTION IS
THAT RATHER THAN Tð TRY TO
IDENTIFY WHO'S GOOD WHO'S BAD,
AND THOSE ARE JUDGMENTS THAT ARE
VERY DIFFICULT TO MAKE OR TO GET
AGREEMENT ON. THE IDEA IS THAT
ALL OF THESE SOCIAL MEDIA
PLATFORMS AND A CLASS OF OTHER
BUSINESSES HERE WOULD ALL PAY
ATTENTION TAX RIGHT AND THE
MOTIVATION IS THAT A LOT OF THE
CHOICES THEY MAKE THAT LEAD TO
THE HARMS OCCUR BECAUSE THEY'RE
ALL CHASING US THEIR ATTENTION
BECAUSE THAT'S WHAT THEY
MONETIZE RIGHT, SO THE IDEA IS
TO IMPOSE AN ATTENTION TAX
COLLECT ALL THE ATTENTION
REVENUE. RIGHT AND THEN GIVE IT
BACK TO PLATFORM USERS. TO USE
IN ORDER TO PAY SUBSCRIPTION
FEES TO PLATFORMS THAT CHOOSE TO
CHARGE SUBSCRIPTION FEES. RIGHT
SO THIS IS AN ECONOMIC SOLUTION.
THAT. CHANGES THE NATURE OF
COMPETITION BECAUSE IF SOME
PLATFORMS WERE TO BETTER THINGS,
AND IN FACT, I HEARD ONE OF THE
PANELISTS AT THE HEARING SAY,
WHY CAN'T WE HAVE XYZ PLATFORM
THAT GIVES US ALL THE BENEFITS
THAT WE WANT, BUT DOESN'T COME
WITH ALL OF THESE HARMS RIGHT?
WHEN A FIRM CHARGES USERS
THEY'RE RESPONSIVE TO THEM.
RIGHT SO THE IDEA OF A VULTURE
IS THAT IT WOULD REDUCE THE
PRICE YOU HAVE TO PAY FOR A
PLATFORM THAT CHOOSES TO DO GOOD
THINGS, AND IT CHANGES THE
NATURE OF THE MARKET AND MAY
EVEN CAUSE THE FIRM THAT WAS
MONETIZING ATTENTION TO THROTTLE
BACK. ITS APPROACH, SO I WON'T
GO INTO ALL OF THE DETAILS OF
THAT. BUT THE POINT IS THAT
SOMETIMES YOU CAN CREATE
SOLUTIONS THAT CHANGE THE WAY
THE MARKET BEHAVES. AND THE
INCENTIVIZE THE PLAYERS IN THE
MARKET TO DO THE RIGHT THING
RATHER THAN GO AND TRY TO
ACTUALLY DO MAKE THEM DO THE
RIGHT THING, WHICH IS OFTEN VERY
HARD TO DO RIGHT. SO IN THIS
SETTING, I WOULD PROPOSE A
COUPLE OF THINGS. THE FIRST IS
JUST LIKE WE THINK OF THE
PHYSICAL INFRASTRUCTURE. WE HAVE
THE HIGHWAYS BUS. SERVICES AND
STOPS OTHER YOU KNOW,
TRANSPORTATION, UTILITIES AND SO
FORTH AS ENABLING COMMERCE WHEN
YOU TRY TO BRING IN A NEW
COMPANY INTO YOUR LOCATION TO
TRY TO TALK TO THEM ABOUT
INFRASTRUCTURE AND OTHER
BENEFITS. I THINK THAT IDEA THAT
HAS BEEN FLOATED HERE IS TO
BUILD A DIGITAL PUBLIC
INFRASTRUCTURE. RIGHT SO THE
REASON UM FARMS ARE UNABLE TO
COMPETE WITH ENTITIES LIKE
TICKETMASTER IS THAT THE ENTRY
BARRIERS ARE VERY HIGH. AND THE
IDEA OF DIGITAL PUBLIC
INFRASTRUCTURE IS TO LOWER ENTRY
BARRIERS AND THEREFORE ENCOURAGE
NEW FIRMS TO ENTER AND GIVE THEM
MORE OPPORTUNITIES TO COMPETE
WITH ESTABLISHED PLAYERS AND
EXACTLY WHAT FORM THAT Dð P THAT
PUBLIC INFRASTRUCTURE WOULD TAKE
IS NOT SOMETHING I'VE THOUGHT OF
ENORMOUSLY, BUT IT'S A VERY
DIFFERENT APPROACH TO REGULATING
AND SOLVING THE PROBLEM. THEN
THEN, YOU KNOW SOME OF THESE
OTHER APPROACHES. ON THE SECOND
ELEMENT, WHERE, UH, THERE'S A
LOT OF FRAUD. UM. IN THE
SECONDARY MARKET, AND ALSO, UH,
THIS ECONOMIC, UM. PROBLEM THAT
THE PROFITS IN SECONDARY MARKETS
? UH THOSE GAINS NEVER GO TO THE
ARTISTS RIGHT? THEY ARE USUALLY
CAPTURED AT OTHER POINTS IN THE
SELLING SYSTEM, BUT THEY ALSO
LEAD TO FRAUDULENT TICKETS. HERE
THERE'S A I THINK FAIRLY SIMPLE
TECHNOLOGICAL IDEA THAT. THE
RESALE MARKET WOULD ALWAYS
CONNECT TO THE AUTHENTIC PRIMARY
TICKET SOURCE, AND THIS CAN BE
DONE THROUGH TECHNOLOGIES, THE
API CALLS AND OTHER THINGS, SO
THAT EVERY TIME A TICKET IS SOLD
DIGITALLY THERE IS IT'S
BASICALLY A DIGITAL TWIN IS
CREATED. WHICH HAS ALL THE
CHARACTERISTICS OF THE ORIGINAL
TICKET. AND SO, FOR INSTANCE,
THE SALE MIGHT BE DONE THROUGH
AN APP. WHICH GUARANTEES THAT
THE SECONDARY TICKET IS ACTUALLY
A REAL ONE AND WILL BE HONORED,
AND THAT CANNOT BE COPIES OF
THAT, SO THERE ARE WAYS TO SOLVE
THE PROBLEM. TECHNOLOGICALLY IT
WOULD REQUIRE THAT COMPANIES
LIKE TICKETMASTER, UM DO WHAT WE
EXPECT, FOR INSTANCE OF
TELECOMMUNICATIONS OPERATORS
THAT HAVE TO PROVIDE ACCESS TO
THEIR THEIR LINES IN THIS CASE
AT SOME FAIR PRICE, AND YOU
COULD IMAGINE THAT THERE COULD
BE A PRICE FOR EVERY API CALL
THAT GOES THROUGH TICKETMASTER.
BUT THEN THAT WOULD ENABLE
AUTHENTIC UM, RESELLING OF
TICKETS. RIGHT SO THOSE THOSE
ARE TWO THINGS THAT I HAVE IN
MIND FOR THE PRIMARY AND
SECONDARY MARKET, AND IT WOULD,
OF COURSE, REQUIRE A LOT MORE
DETAIL. BUT I THOUGHT THIS WAS
AN INFORMATIONAL HEARING. SO
THAT'S PROBABLY ENOUGH DETAIL.
WE KNOW WHERE TO FIND IT. SO
THANK YOU FOR THAT, MR. CHAIR.
DID YOU WANNA HAPPEN IN WITH
SOME QUESTIONS? I THINK HE
ANSWERED IT. THANK YOU VERY
MUCH. I'M SURE I THINK HE
ANSWERS TO Y. YOU KNOW, I THINK
THAT THE REAL ISSUE IS BOUGHT
RIGHT? AND THOSE INDIVIDUALS, UM
, FINDING LOOPHOLES AND GOING
AROUND THE SYSTEM THAT CAUSES
DISENFRANCHISEMENT OF THOSE WHO
SEEK TO GO OUT AND HAVE AN
ENJOYABLE EXPERIENCE HERE IN
CALIFORNIA, WHATEVER THE VENUE
MAY BE. AND SO AS MY COLLEAGUE,
THE CHAIRWOMAN SAID, YOU KNOW
THAT WE ARE SOPHISTICATED
SOCIETY, AND IT SEEMS THAT OUR
SOPHISTICATION IS NOT SO
SOPHISTICATED. UH BECAUSE OF THE
FACT THAT THIS EXISTS AND MY
THING IS MAKING SURE THAT PEOPLE
ARE NOT TAKING ADVANTAGE OF
BECAUSE IT'S NOTHING MORE
HORRIFYING THAT YOU BUY TICKETS
FOR YOUR CHILDREN AND YOU GET
THERE, AND THOSE TICKETS ARE
FAKE. OK AND SO, PLEASE. YEAH SO
I THINK YOU YOU REALLY POINTED
OUT TWO PROBLEMS, TOO, AND
THEY'RE INTERCONNECTED PROBLEMS,
THE FIRST THAT THERE ARE BOTS
THAT OPERATE AND PURCHASE
TICKETS AND THE SECOND THAT THE
RESOLD TICKETS ARE OFTEN FRAUD.
RIGHT THE BOTS. THE BOUGHT
TICKETS COULD ACTUALLY BE
AUTHENTIC IF THEY'RE SOLD
CORRECTLY, SO THESE ARE TWO
DIFFERENT PROBLEMS. UM SO THIS
IS WHY I WENT BACK. A FEW
DECADES AGO, 50 YEARS AGO, LET'S
SAY RIGHT, BECAUSE WHEN THE
INDUSTRY OR MAYBE EVEN LONGER
WHEN THE INDUSTRY BEGAN
OPERATING IT MAKES SENSE TO NOT
US THAT ENTERTAINMENT TICKETS BE
LINKED TO IDENTITY. AIRLINE
TICKETS ARE LINKED TO IDENTITY.
YOU HAVE TO PRESENT AN I Dð TO
ATTEND TO GET ON THE PLANE, AND
WE DON'T THINK THAT WAS
APPROPRIATE FOR ENTERTAINMENT
TICKETING, BUT BECAUSE THAT
WOULD CREATE A LOT OF PROBLEMS,
AND THEN IT WOULD REALLY MAKE
THE RESELLING OF TICKETS VERY,
VERY DIFFICULT. IN A WORLD 50
YEARS AGO, WHEN YOU HAD TO SELL
PHYSICAL TICKETS TO OTHER
PEOPLE, RIGHT? IT IS NOT
IMPOSSIBLE TODAY. TO THINK OF
LINKING. AND ENTERTAINMENT EVENT
, ESPECIALLY THE HIGH PRICED
ONES, IDENTITY AND
AUTHENTICATION BECAUSE. IF I GO
BACK TO THE DISCUSSION I HAD
EARLIER ABOUT ABOUT RESELLING
TICKETS THROUGH AN ELECTRONIC
SYSTEM. IT WOULD BE VERY
STRAIGHTFORWARD TO ALSO. GET A
NAME, CHANGE FOR THE NEW BUYER
AND HAVE IT CAPTURED INTO THE
CENTRALIZED, UH, DATABASE THAT
CAN BE LOOKED AT AT THE POINT OF
ATTENDANCE. RIGHT? SO IT'S NOT
IT. IT'S AN IDEA THAT WOULD NEED
A LOT MORE DISCUSSION. BUT I
THINK WHAT WE CALL THE OVERHEAD
COSTS OF RESELLING TODAY.
DRAMATICALLY LOWER AND CLOSE TO
ZERO IF YOU COULD HAVE AN
ELECTRONIC EXCHANGE SYSTEM NOW
THE REASON BOTS EXIST IS BECAUSE
THERE IS NÓ, UH, IDENTITY
ATTACHED TO A TICKET. RIGHT AND
I GREW UP IN INDIA AND IN THE 19
SEVENTIES AND EIGHTIES. UM IF
YOU WANTED TO TRAVEL ON THE
TRAIN SYSTEM YOU COULD NEVER
FIND TICKETS. TO BUY BECAUSE
THEY WERE ALL BOUGHT BY NOT BOTS
. BUT BROKERS AT THE TIME AND
THEN THEY WERE RESOLD AT CRAZY
PRICES. UM. AND THAT PROBLEM WAS
EVENTUALLY SOLVED BECAUSE
TRAVELING ON THE TRAIN IN INDIA
NOW REQUIRES AN IDENTIFICATION
AND YOU NEED TO MATCH YOUR NAME
TO YOURSELF, AND THEREFORE, THAT
CRIPPLES THE MARKET FOR AGENTS
THAT MIGHT BUY HUNDREDS OF SEATS
AT THE SAME TIME. SO THAT'S ONE
PART OF THE SOLUTION, AND I
DON'T KNOW IF IT'S TIME TO LINK
IDENTITY TO A TICKET, BUT IT'S
SOMETHING THAT WOULD BE WORTH
CONSIDERING. AND I THINK THE
PROBLEM OF FRAUDULENT TICKETS IS
SOMETHING THAT IT IS ACTUALLY
MORE EASILY SOLVED WITH THE
ELECTRONIC ARRANGEMENTS. ANYBODY
ELSE? OK WELL, THANK YOU SO MUCH
. THAT WAS INCREDIBLY HELPFUL TO
GIVE US THE LAY OF LAND. AND NOW
WE'RE GONNA HEAR FROM ALL OF THE
PEOPLE THAT YOU'VE TALKED ABOUT,
SO NOT ALL OF THEM AND I WILL
POINT OUT THAT I CALLED OUT THE
SPORTS TEAMS. THE BROKERS ALSO
CHOSE NOT TO SHOW UP SO UM. SO
UH, WE WILL NOW BRING UP OUR
SECOND PANEL FROM THE PRIMARY
AND SECONDARY MARKETPLACE. DÂN
WALL EXECUTIVE VICE PRESIDENT OF
TICKETMASTER. LAURA DOOLEY, HEAD
OF EXTERNAL AFFAIRS AT STUBHUB,
AND ROBERT DERI, CHIEF EXECUTIVE
OFFICER AND FOUNDER OF Tð TAR,
YOU CAN CORRECT ME IF I
MISPRONOUNCED THAT, OK? AWESOME
THANK YOU ALL FOR BEING HERE AND
IT LOOKS LIKE YOU SAT AND YEAH,
YOU CAN SIT THERE AND WE'LL JUST
START AND YOU WANT TO START AND
MOVE THIS WAY. NÓ YOU? YOU CAN
STAY RIGHT WHERE YOU ARE. WE'LL
START WITH DÂN AND THE MOVE TO
YOU. TERRIFIC. UH, GOOD
AFTERNOON. I DO. WE HAVE SOME
SLIDES THAT I THINK THEY'RE
GOING TO PUT UP. SORRY THAT YOU
HAVE TO TURN AROUND AGAIN. OK,
IT'S ALL GOOD. UM SO IT'S A
PLEASURE TO BE HERE TO ADDRESS
THESE ISSUES. UM, I DO WANNA SAY
, UH, THAT, UH, I WANNA
COMPLIMENT THOSE WHO WORKED ON
THE BRIEFING. IT'S EXCELLENT.
UH, IT IT IF, UM, IF THERE WAS A
CONCERN THAT THAT YOU ALL DON'T
KNOW WHAT'S GOING ON, IT WAS PUT
TO REST BY THE BRIEFING PAPER.
SO IT IT IS REALLY VERY GOOD. UM
A LOT OF MY, UH, REMARKS HERE
ARE GOING TO BE, UM, SIMILAR TO
WHAT DOCTOR BARGA JUST SAID, UM,
AND BUT I'M GOING TO THEN PIVOT
TO THE BIG POLICY ISSUES THAT I
THINK, UM, WE SHOULD BE
ADDRESSING UM, SO IF WE PUT UP
THE FIRST SLIDE, THIS IS A
DIFFERENT REPRESENTATION OF HIS
FIRST SLIDE. UM AND IT'S JUST
MAKING THE POINT THAT THAT THAT
IT'S A COLLABORATIVE ENDEAVOR TO
PUT ON A CONCERT OR OR OR
SPORTING EVENT. UM AND THIS IS
REALLY CONCERT ORIENTED TO SLIDE
. IT ALL BEGINS WITH THE ARTIST.
IT KIND IT ENDS WITH A FAN, AND
IT'S ALL ABOUT THE CONNECTION
BETWEEN THE ARTIST AND THE FAN.
THAT'S THAT'S WHAT THE WHOLE
SYSTEM IS ABOUT, UM THAT LIVE
NATION AS A PROMOTER IS, UH,
WORKING WITH THE ARTIST. THE
PROMOTERS ESSENTIALLY FINANCE
AND PUT UP THE CAPITAL FOR, UH,
THE CONCERT. WE ALSO, UH, RUN
MANY OF THE TOUR LOGISTICS, THE
TOURING, UM, THE MAKING THE
ARRANGEMENTS, UH, THAT THAT CAN
MAKE THE PARTICULARLY THE
INCREASING NATIONAL OR EVEN
WORLD TOUR. UH, POSSIBLE. VENUES
OF VARIOUS KINDS ARE ARE ARE
SCATTERED ABOUT. OBVIOUSLY YOU
NEED A VENUE FOR THE FOR THE
CONCERT. UM VENUES ARE ACTUALLY
THE ONES WHO ISSUE TICKETS.
TICKETS UM, AS A LEGAL MATTER
OUR LICENSES TO ENTER THE
FACILITIES DURING THE TIME OF
THE SHOW. UM AND SO VENUES ARE
THE ONES THAT THAT THAT THAT
CONTROL THE TICKET STOCK.
ALTHOUGH IT IS IT IT IT TURNS
OUT THAT IT'S REALLY THE ARTISTS
WHO WHO WHO PRICE THEM. UM UM
AND THEN, UH, PRIMARY TICKETING.
UH, PLATFORM LIKE TICKETMASTER,
UM OR ACCESS? UM UH OR èC GEEK
IS THERE TO BOTH BE THE
TRANSACTION IN ENGINE THAT
DISTRIBUTES THE TICKETS, BUT
ALSO IT IS ESSENTIALLY THE BACK
OFFICE. UM UH, PROGRAM FOR THE
VENUE. IT'S A VENUE MANAGEMENT.
UH, UH, PROGRAM AND THERE ARE A
LOT OF, UH, ECONOMIC
INTERRELATIONS BETWEEN. UM THESE
THESE PLAYERS MOVING ON TO THE
NEXT SLIDE, UM IN TERMS OF
TICKET PRICES. THAT'S THAT IS
VERY MUCH A FUNCTION OF DEMAND
FOR THE ARTIST. I HEARD DOCTOR
BARGAS COMMENT ABOUT HOW THE
ARTIST COMMUNITY IS FRAGMENTED,
AND THAT'S TRUE. BUT THERE IS
ONLY ONE BEYONCE. THERE'S ONLY
ONE TAYLOR SWIFT, AND THAT'S WHO
PEOPLE WANT TO SEE. AND SO, UM,
THIS IS BAD BUNNY WHO, IF YOU
LOOK AT THE SLIDE HERE, YOU WANT
TO SEE WHAT THE SOURCE OF AN
ARTIST'S, UH, ABILITY. UH,
PRICING POWER MAY BE. THIS IS
THIS IS SOMEONE WHO UM, HAS, UM,
VASTLY MORE. UH UH, SOCIAL MEDIA
FOLLOWERS AND MONTHLY LISTENERS
ON STREAMING SERVICES. UH THEN
HE HAS TICKETS TO SELL. AND SO
THE SUPPLY DEMAND UH UH, BALANCE
IS HUGE. AND UNFORTUNATELY THAT
SUPPLY UH, DEMAND IMBALANCE
TENDS TO BE ONLY, UH, A LARGE
THING FOR A SMALL NUMBER OF TOP
ACTS FOR MOST ACTS. UH, IT IT'S
NOT UM, BUT IT IS IT. IT IS.
IT'S ALWAYS GOING TO BE
ULTIMATELY, THE SOURCE OF THE
PRICE OF THE TICKETS IS HOW MUCH
DO PEOPLE WANT US? WANNA SEE
THIS SHOW? UM THOSE TICKET
PRICES WILL BE SET BY THE ARTIST
WHICH DOES NOT LITERALLY MEAN
BAD BUNNY. IT MEANS HIS BUSINESS
MANAGER OR OR OR OR OR OR OR OR
AGENT AND THAT WILL BE DONE IN
IN CONSULTATION WITH WITH, UH UH
, THE PROMOTER USED THE PROMOTER
IS MAKING A GUARANTEE THAT IS
BASICALLY, UH, DRIVEN IN THE
FIRST INSTANCE BY AN EXPECTATION
ABOUT HOW MANY TICKETS AT A
CERTAIN PRICE POINT ARE ARE
GOING TO BE, UH, SOLD. WE ARE
LIVING IN A TIME OF
UNPRECEDENTED DEMAND FOR
TICKETS, ESPECIALLY COMING OUT
OF WHEN WE WERE ALL LOCKED UP
FOR A COUPLE OF YEARS. UM BUT
IT'S ALSO A PRODUCT OF THIS THIS
THING THAT WE'VE SEEN, UH,
CALLED THE EXPERIENCE ECONOMY
THAT'S BECOME INCREASINGLY
IMPORTANT. AND THE AND THE
SOCIAL MEDIA CONNECTIONS THAT
THAT ALLOW FOR BOTH DISCOVERY OF
NEW ARTISTS AND, UM THE, UM, UM,
THE MARKETING OF SHOWS. NOW UM,
ON THE NEXT SLIDE, THERE'S
ANOTHER FACTOR, WHICH IS WHICH
IS JUST THAT WE ARE NOW LIVING
IN A WORLD WHERE WHERE CONCERTS
ARE ARE THE PRIMARY SOURCE OF AN
ARTIST'S INCOME IT IT USED TO
BE. ONCE UPON A TIME, THE
CONCERTS WERE, UH, UH, MARKETING
FOR RECORD SALES. THAT'S WHAT
THEIR ECONOMIC FUNCTION WAS, AND
UM, AND THEY WERE OFTEN
PERFORMED AT A LOSS. UM, BECAUSE
THE RECORD COMPANY KNEW, UM,
THAT IT WAS GOING TO MAKE A LOT
OF EXTRA RECORD SALES, AND
THAT'S WHAT IT'S ABOUT. BUT NOW,
UM DREAMING TOOK AWAY THE RECORD
, UH, INCOME AND NOW THE IT IT
IS THE PRIMARY SOURCE OF AN
ARTIST'S INCOME. AND SO IT ENDS
UP BEING, UM, PRICED
ACCORDINGLY. NOW UM, AN
IMPORTANT THING, UM, THAT I
WANNA COVER BECAUSE A LOT OF
PEOPLE SAY THAT THAT THAT
TICKETMASTER OR TICKETMASTER FEE
IS A PRIMARY. UH UH, TICKETING
FEES ARE RESPONSIBLE FOR TICKET
PRICES. UM IS THAT IN FACT, THE
PRIMARY TICKETING THE
DISTRIBUTION FUNCTION ADDS VERY
LITTLE TO THE TO THE TO THE
TICKET PRICE. AND THAT'S THE
NEXT SLIDE, PLEASE. UM, THIS IS
A DEPICTION. WE ACTUALLY STOLE
THIS SLIDE FROM OUR COMPETITOR.
A G? WE JUST LIKE THEIR SLIDE.
UH IT IT IT IT IT IT IT IS. IT
IS A SLIDE IN WHICH YOU TAKE A
TICKET THAT HAS $100 SPACE VALUE
. THE FACE VALUE IS AN ARTIFACT
OF THIS INDUSTRY THAT HAS TO DO
WITH THE WITH A POOL OF MONEY
THAT IS TYPICALLY SPLIT BETWEEN
THE ARTIST AND THE PROMOTER. AND
THEN WHAT'S PUT ON TOP OF THAT
IS THE SERVICE FEE IS ACTUALLY
THE COMPENSATION FOR THE VENUE
AND THE TICKET DISTRIBUTION
COMPANY. AND MOST OF THAT GOES
TO THE VENUE. THE GENERAL SPLIT
OF THAT IS ABOUT TWO THIRDS. ONE
THIRD. SO IF YOU TAKE $100 FACE
VALUE TICKET AND YOU ADD AN 18%
FEE TO THAT VENUE, IT'S GONNA
GET ROUGHLY $12 AND THE
TICKETING COMPANY IS GOING TO
GET ABOUT $6 TICKETING COMPANY
HAS COSTS IT. IT TURNS OUT
PRIMARY TICKETING COMPANY, UM IS
USUALLY MAKING A PROFIT. THAT IS
ON THE ORDER OF 2% OF THE TICKET
PRICE. IT'S NOT THE SOURCE OF.
OF WHY TICKETS COST SO MUCH THEY
COST WHAT THEY COST IN THE FIRST
INSTANCE BECAUSE OF DEMAND. BUT
THERE IS ANOTHER FACTOR IN THE
INDUSTRY THAT THAT THAT WE COVER
ON THE NEXT SLIDE. AND THAT IS
THIS. THIS WORLD THAT WAS
CREATED. UM UH, REALLY MEAN TO
THEIR CREDIT BY STUBHUB IN 2000
WITH WITH, UH, THE ON ONLINE? UM
UH, RESALE MARKETPLACES, WHICH
WAS REVOLUTIONARY IN THE SAME
WAY THAT STREAMING WAS TO, UM,
THE MUSIC BUSINESS IT IT ALTERED
THE ECONOMICS SUBSTANTIALLY BY,
UM UH FROM TECHNOLOGY. UM
ARTISTS ALWAYS UNDERPRICE THEIR
TICKETS. UM IT'S BEEN GOING ON.
THERE'S HISTORICAL RECORDS THAT,
UM, THAT THE TICKETS TO THE
OPENING OF DICKENS' A CHRISTMAS
CAROL, UM WE'RE UNDERPRICED AND
THEREFORE THERE THERE WERE TOUTS
AS THEY CALLED THEM IN IN
ENGLAND. UM UH UH UH, SELLING
THERE, BUT THE INTERNET SCALE OF
RESALE CHANGED IT ALL. AND WE
ARE NOW LIVING IN A WORLD WHERE
WHERE HIGH VOLUME TICKET
RESELLING IS CREATING A CONSTANT
, UM NEW PRICE LEVEL FOR TICKETS
THAT IS TYPICALLY DOUBLE WHAT
THE ARTIST SET FOR, UH, THE SHOW
THE CHART HERE IS A NUMBER OF
SHOWS THAT THAT WE A
TICKETMASTER, UM, PUT OUT, UH,
IN THE LATE 2000 UH 20 Tð 22 AND
THEN EARLY 2020 THREE STUDY.
THIS AND BASICALLY EVERY SHOW IS
THAT THE AVERAGE RESALE PRICE IS
MORE THAN THAN TWICE THE, UM THE
ARTIST INTENDED PRICE, AND
THAT'S THE ANSWER TO WHY, UM,
UH, SHERMAN GIBSON, YOU HAVE THE
BOTS. UM IT'S YOU KNOW, IT'S
BECAUSE THERE IS SO MUCH MONEY
IN DOING THAT, AND
TECHNOLOGICALLY WE ADDRESS THAT
WITH MORE RESOURCES THAN ANY
COMPANY IN THE IN THE WORLD, AND
I CAN TELL YOU THAT WE PROBABLY
STOP 99.9% OF THE BOTS. BUT.
THAT'S WE GIVE OURSELVES AN F
FOR THAT. BECAUSE IF YOU DON'T
STOP THEM ALL THAT MEANS THAT
TENS OF THOUSANDS OR HUNDREDS OF
THOUSANDS OF FANS ARE GOING TO
LOSE OUT ON THE OPPORTUNITY TO
BUY THOSE TICKETS AT THE PRICES
THAT THE ARTISTS INTENDED. AND
THERE IS NOTHING POSITIVE FROM
AN ECONOMIC OR SOCIAL STANDPOINT
, UH, IN THAT AT ALL, AND THAT
HAPPENS BECAUSE THE OPPORTUNITY
ON THE SECONDARY MARKET BETWEEN
THE TICKET BROKER AND THIS IS
OVERWHELMINGLY A TICKET BROKER
BUSINESS 80% OF THE RESALE
MARKET IS TICKET BROKERS, UM,
THAT THAT THE ECONOMIC
OPPORTUNITY THERE BETWEEN THE
TICKET BROKER AND THE RESALE
PLATFORM IS ACTUALLY GREATER, UM
, PER TICKET THAN WHAT THE BAND
CAN MAKE ON THE SHOW, AND THAT'S
WHAT'S DEPICTED. ON THIS. THIS
NEXT SLIDE. WHERE IF YOU IF YOU
LOOK AT AT AT THAT $100 TICKET
THAT REALLY WAS 100 AND $18
TICKET WITH FEES, UM, THAT'S
PURCHASED BY A BROKER. UM IT'S
PUT ON ON ON SALE AT A PRICE TO
WHICH WE ASSUMED HERE TO BE
TWICE THE FACE VALUE PLUS FEES,
SO IT COMES OUT TO 243 FEES ARE
MUCH HIGHER ON THE SECONDARY
MARKET. UM BUT THE RESALE
PLATFORM IS GONNA MAKE ABOUT $60
ON THAT AND RESELLER THE BROKER
IS GOING TO MAKE ABOUT 65. THE
BAND WILL PROBABLY MAKE ABOUT 65
OR 70 ITSELF PER TICKET AFTER A
AFTER ITS COST, SO THERE'S SO
MUCH MONEY IN RESALE THAT IT'S
JUST IT'S DISTORTING EVERYTHING
IN THE INDUSTRY, AND I'D BE
HAPPY TO ANSWER MORE QUESTIONS
ABOUT THAT. SO JUST A QUICK LIST
OF THINGS THAT WE THINK THAT
THAT NEED TO BE DONE TO ADDRESS
SOME OF THESE ISSUES. UM UH, THE
NEXT SLIDE, PLEASE. UM IN FACT,
YOU YOU CAN GO TO THE SLIDE
AFTER THAT. THE FIRST THING IS,
WE ARE FINALLY ON THE PRECIPICE
OF HAVING ALL IN PRICING. UM WE
ARE. WE ARE ALMOST THERE. UH WE,
YOU KNOW, WE HAVE A GREAT BILL
IN CALIFORNIA THAT WAS ENACTED
INTO LAW 478, WHICH WE THINK IS
GREAT. WE AT AT LIVE NATION,
TICKETMASTER ARE PUSHING VERY
HARD FOR A FEDERAL UM, WE HAVE
LIVE NATION. UH VENUES NOW HAVE
ALL IN PRICING. UM BUT, UM, BUT
WE WILL JUST TELL YOU FROM OUR
EXPERIENCE THAT THERE IS A GREAT
DEAL OF EVASION OF THE EXISTING
ALL IN PRICING LAWS THAT HAVE
THAT HAVE BEEN ENACTED IN NEW
YORK AND OTHER STATES. UM I
DON'T THINK THERE SHOULD BE ANY
AMBIGUITY ABOUT ABOUT WHAT S¼
478 MEANS. BUT IF WE HAVE THAT
PROBLEM IN CALIFORNIA, WE HAVE
TO JUMP ON IT BOTH FROM THE
ATTORNEY GENERAL'S OFFICE AND IF
NECESSARY, UM THROUGH THE SECOND
ISSUE IS SPECULATIVE TICKETING.
UM SPECULATIVE TICKETING AS HIS
PRACTICE OF PUTTING UP FOR SALE
A TICKET THAT YOU DON'T ACTUALLY
HAVE. IT'S DONE BY BROKERS.
THAT'S THAT'S WHO DOES IT. UM IT
GO. IT GOES ON INCESSANTLY ON ON
, UM, SEA GEEK SUBURB AND VIVID.
IT'S NOT PERMITTED ON
TICKETMASTER. I CHECKED
YESTERDAY. UM UH, JUST TO GET AN
EXAMPLE THE DAVE MATTHEWS BAND
IS JUST GONE ON SALE THIS
MORNING AT NINE O'CLOCK, UM,
WITH A WITH A NUMBER OF NEW
AMPHITHEATER SHOWS. YESTERDAY
THERE WERE SPECULATIVE TICKETING
LISTINGS FOR THAT SHOW ON STOP
UP VIVID AND SEE GEEK AND
LEGISLATIVELY. BE CAREFUL OF THE
TROJAN HORSE BECAUSE THE RESALE
SITES HAVE BEEN SAYING THAT THEY
WOULD WOULD FAVOR SOME SORT OF
SPECULATIVE TICKETING
LEGISLATION, BUT THEY WANTED TO
HAVE EXCEPTIONS, LIKE THE IDEA
THAT IF IT'S A SERVICE OF
PROCURING A TICKET, IT DOESN'T
COUNT, WHICH IS JUST GUTTING IT
BECAUSE IF YOU ACTUALLY LOOK AT
THE SITES, THEY THEY THEY MARKET
THE SERVICE. IN THE EXACT SAME
FORM AND MANNER AS A TICKET
LISTING. IT LOOKS LIKE A LIKE A
TICKET LISTING. UH AND WHICH IS
GROSSLY MISLEADING BECAUSE THEY
DO NOT OWN THOSE TICKETS, UM AND
SHOULD NOT BE SAYING THAT. UM
THE DECEPTIVE WEBSITES. NEXT
SLIDE SHOULD BE THE EASIEST
THING. THERE'S JUST I ACTUALLY
FOUND THIS YESTER YESTERDAY BY
CHANCE. WHERE WHERE I TYPED INTO
MY GOOGLE SEARCH BAR OF ALL
THINGS, THE WORD TICKETMASTER
AND THE TOP LISTING WAS SOME
OTHER WEBSITE SOME OTHER COMPANY
THAT BRANDED ITSELF AS
TICKETMASTER. UM, UH, EVEN
THOUGH THE URL WAS DIFFERENT, SO
THIS THIS THIS THIS SHOULD NOT
BE CONTROVERSIAL THAT THIS JUST
HAS TO BE A UNEQUIVOCALLY, UM,
OUTLAWED. AND THEN THE LAST
THING THAT I'LL CLOSE ON IS WE
DO THINK THAT THAT THESE ISSUES
SURROUNDING TICKET
TRANSFERABILITY, UM THAT THAT
PUBLIC POLICY NEEDS TO COME OUT
ON THE SIDE OF THE ARTIST AND
THE FAN ON THIS ONE, AND IT'S
VERY SIMPLE. THE ARTIST WANTS
THE TICKET TO GO TO ITS FAN AND
IT AND WE CAN DELIVER THAT
TECHNOLOGICALLY, BUT IT'S NOT
OUR CALL AS TO WHETHER TO DO
THAT. NEVERTHELESS OTHER RESALE
SITES ARE TRYING AND BROKERS ARE
TRYING TO GET LEGISLATION
PASSED. PREVENTING US FROM FROM
LETTING THE ARTIST MANAGE THEIR
THEIR RESALE. UM YOU SHOULD BE
VERY WARY OF THAT. IT'S NOT IN
THE CONSUMER INTEREST. THANK YOU
VERY MUCH. THANK YOU. OK, LAURA,
MOVING RIGHT ALONG TO YOU. UH,
THANK YOU. CHAIRS UH, MEMBERS OF
THE COMMITTEE. HELLO MY NAME IS
LAURA DOOLEY. I AM PART OF
STUBHUB EXTERNAL AFFAIRS TEAM.
OUR TEAM FOCUSES ON DEVELOPING
RELATIONSHIPS WITH EXTERNAL
AUDIENCES LIKE POTENTIAL
COMMERCIAL PARTNERS,
POLICYMAKERS AND MEDIA. UH,
THANK YOU SO MUCH FOR THE
OPPORTUNITY TO BE HERE TODAY TO
DISCUSS THE LIVE EVENT INDUSTRY.
UM I HOPE TO USE MY TIME TODAY
TO REALLY ACCOMPLISH THREE
THINGS. ONE TO INTRODUCE STUBHUB
AND GIVE A LITTLE BIT OF MORE
BACKGROUND ABOUT OUR BUSINESS
MODEL TO HIGHLIGHT HOW THE LACK
OF COMPETITION IN OUR INDUSTRY
REALLY? IT'S CONSUMER CHOICE AND
IS THIS IS THE ROOT CAUSE OF A
LOT OF THE DOWNSTREAM PROBLEMS
THAT CONSUMERS FACE AND THREE
OUTLINE HOW WE BELIEVE OPENING
THE INDUSTRY TO BETTER
COMPETITION IS THE CRITICAL
FIRST STEP, NOT THE ONLY STEP,
BUT THE FIRST STEP IN ADDRESSING
A LOT OF THE FRUSTRATIONS YOU'LL
HEAR TODAY. UM SO JUST JUMPING
RIGHT INTO IT. WHAT IS ST POD?
UM, HOW DID WE GET HERE? WELL
SOPA WAS ACTUALLY FOUNDED RIGHT
HERE IN CALIFORNIA AS A STANFORD
BUSINESS SCHOOL PROJECT. OUR
FOUNDER WAS TRYING TO GET LION
KING TICKETS ON THE RESALE
MARKET AND THOUGHT TO HIMSELF.
THERE HAS TO BE A BETTER WAY
THAN PURCHASING A TICKET FROM A
STREET CORNER OR FROM A
CLASSIFIED AD WITHOUT ANY, YOU
KNOW, GUARANTEES OR CONSUMER
PROTECTIONS IN THAT TRANSACTION,
AND AS YOU KNOW, AND YOU'VE
HEARD STUBHUB DIDN'T CREATE THE
IDEA OF RESALE THAT'S BEEN IN
EXISTENCE FOR A LONG TIME. UM,
AND IT'S BEEN REGULATED. FOR A
LONG TIME ACROSS THE UNITED
STATES. BUT OUR FOUNDERS THOUGHT
THAT THERE'S A BETTER WAY TO DO
THIS. AND SO THEY TRIED TO
LEVERAGE TECHNOLOGY TO CREATE AN
ONLINE MARKETPLACE THAT COULD
CONNECT BUYERS AND SELLERS IN A
TRANSPARENT AND SECURE WAY. ALL
BACKED UP WITH THE CONSUMER
PROTECTION GUARANTEE, WHICH IS
REALLY THE DIFFERENTIAL FROM HOW
THE TICKET RESALE MARKET EXISTED
BEFORE. OUR CUSTOMER SERVICE AND
OUR FAN PROTECT GUARANTEE IS
REALLY WHAT PROVIDES OUR
CUSTOMERS THE CONFIDENCE TO BUY
AND SELL ON OUR SITE. SO 20 PLUS
YEARS LATER, UM WE STILL CALL
CALIFORNIA HOME WITH ONE OF OUR
DUAL HEADQUARTERS IN SOUTHERN
CALIFORNIA WITH OVER 90
EMPLOYEES IN THE STATE AND
GROWING RESALE HAS BECOME AN
IMPORTANT AND ACCEPTED PART OF A
LIVE EVENTS. INDUSTRY AND
REGULATIONS HAVE REALLY ADAPTED
OVER TIME TO RECOGNIZE HOW
CONSUMERS PARTICIPATE IN THIS
MARKET, BOTH FOR ORIGINAL TICKET
SALES AND FOR RESALE. UM, WE'VE
GOT PARTNERS. ACROSS THE U S¼,
INCLUDING HERE IN CALIFORNIA
WITH THE SAN FRANCISCO GIANTS,
AND THE AND THE L, A ANGELS AND,
UM, OVER THE LAST 12 MONTHS
ALONE, WE CAN SAY THAT WE'VE
SERVICED 1.3 MILLION UNIQUE
CALIFORNIA BUYERS AND MORE THAN
185,000, CALIFORNIA SELLERS,
UNIQUE CALIFORNIA SELLERS 25% OF
OUR SALES TO CALIFORNIA EVENTS
COME FROM CUSTOMERS FROM ALL
OVER THE U S¼. WE'VE SOLD
TICKETS TO CALIFORNIA EVENTS
FROM, UH UH UH, FOR TO BUYERS IN
ALL 50 STATES, WHICH WE THINK IS
A GREAT WAY TO PROVIDE CHOICE,
FLEXIBILITY AND TO THE EVENTS
THAT PEOPLE WANNA SEE SO AS A
MARKETPLACE. HOW DOES OUR HOW
DOES OUR BUSINESS WORK? OUR JOB
AGAIN IS TO CONNECT BUYER AND
SELLER AND TO PROVIDE CUSTOMER
SUPPORT NEEDED TO SUPPORT THAT
TRANSACTION AND MAKE IT
SUCCESSFUL. UNLIKE YOUR ORIGINAL
TICKET SELLERS, YOUR ARTISTS,
YOUR TEAMS OR YOUR, UM YOU KNOW
OTHER EVENT CREATORS. WE DON'T
SET THE PRICE OF THE TICKETS
THAT SELL ON OUR SITE. THOSE
PRICES ARE SET BY THE SELLERS
THEMSELVES. OUR SELLERS COULD BE
A MULTITUDE OF PEOPLE. THEY
COULD BE AVERAGE CUSTOMERS. THEY
COULD BE PROFESSIONAL TICKET
SELLERS, THEY COULD SOMETIMES BE
PARTNER. SO THEY DECIDE TO LIST
TICKETS DIRECTLY ON OUR SITE,
BUT ULTIMATELY THEY SET THE
PRICE AND OUR BUYERS DECIDE IF
THAT PRICE AND THAT SERVICE THAT
THEY'RE OFFERING IS ATTRACTIVE.
UM SO HUB CHARGES A FEE FOR THE
USE OF OUR SERVICE, AND THAT'S
THE ONLY REVENUE THAT WE COLLECT
FROM. A SALE ON OUR SITE AS
WELL. SO SUB HUB DOES NOT
COLLECT THE COST OF THE TICKET
OR THE PRICE OF THE TICKETS THAT
LISTED FOR SALE, BUT JUST THE
FEE THAT'S ASSOCIATED WITH OUR
TRANSACTION. UM AND OUR FEES GO
TO OPERATING A GLOBAL BUSINESS
TO SUPPORTING OUR CUSTOMER
SERVICE AND TO PROVIDING OUR
FAMILY PROTECT GUARANTEE TO OUR
CUSTOMERS. UM OUR FEES ARE
ALWAYS CLEARLY DISCLOSED BEFORE
A TRANSACTION IS COMPLETE, BUT
THAT SAID, WE'RE VERY ENCOURAGED
BY THE MOVEMENT OF STATES LIKE
CALIFORNIA TO ALL IN PRICING,
AND WE EXPECT MONEY TO FOLLOW
SUIT. WITH CALIFORNIA BEING
REALLY THE FIRST TO GO TO A
TRADITIONAL AND PING MODEL. IN
JULY. UM AND WHILE WE MAY HAVE
BEEN THE FIRST IN THE RESALE
MARKETPLACE AT SCALE, WE'RE
CERTAINLY NOT THE LAST. THERE
ARE MANY OTHERS THAT HAVE JOINED
THIS INDUSTRY, INCLUDING èC,
GEEK, VIVID SEATS, AND, IN FACT,
TICKETMASTER RESALE. UM WE'VE
CREATED COMPETITION FOR
CONSUMERS IN AN OTHERWISE HIGHLY
CONCENTRATED OR CONSOLIDATED
INDUSTRY. UM, THE COMPETITION
AND TICKET RESALES AND START
CONTRAST TO HOW TICKETS ARE SOLD
ORIGINALLY BY THE ORIGINAL
SELLER, UM AND UNFORTUNATELY
THAT COMPETITION IS UNDER THREAT
IN MANY WAYS, BASED IN PART
THROUGH THE USE OF RESTRICTED
TECHNOLOGIES THAT CAN ELIMINATE
OR PROHIBIT RESALE OR OFTEN
THROUGH, UM, AN ANTI COMPETITIVE
TERMS AND CONDITIONS, SO I JUST
WANNA WALK QUICKLY THROUGH LIKE
HOW AN ORIGINAL TICKET IS SOLD
AND HOW THAT CONTRAST TO THE USE
OF OUR SITE, BUT I ENCOURAGE YOU
TO THINK ABOUT ANY SINGLE EVENT
AS A MONOPOLY IN AND OF ITSELF
THE ORIGINAL TICKET SELLER,
WHETHER THAT BE THE TEAM, THE
ARTIST OR AGAIN, THE EVENT
CREATOR GENERALLY SELLS THEIR
TICKET EXCLUSIVELY THROUGH ONE
TICKETING PROVIDER. THAT
TICKETING PROVIDER GENERALLY IS
CHOSEN BY THE VENUE WHO HAS THAT
EXCLUSIVE RELATIONSHIP RIGHT
WITH WITH THE WITH THE VENUE
ITSELF, IF WE WERE TO PUT THAT
MODEL INTO ANOTHER INDUSTRY,
JUST FOR POINT OF COMPARISON,
IMAGINE IF YOU WANTED TO BUY THE
LATEST IPHONE AND THE ONLY WAY
YOU COULD DO IT WAS TO BUY IT
FROM ONE STORE ON ONE DAY. YOU
COULDN'T GO TO WALMART. YOU
COULDN'T GO TO TARGET YOU
COULDN'T GO TO YOUR, UH,
CUSTOMER. YOUR SERVICE PROVIDER
FOR YOUR PHONE. YOU HAVE TO GO
TO THAT ONE APPLE STORE AND ON
THE DESIGNATED TIME, WHICH IS
TYPICALLY IN THE MIDDLE. THE DAY
IN THE MIDDLE OF THE WEEK. YOU
HAVE TO LINE UP AND THEN APPLE
STORE DOES NOT TELL YOU HOW MANY
TICKETS WILL BE AVAILABLE FOR
SALE THAT DAY. NOR DID THEY STOP
THE LINE FROM QUEUING. IF THEY
KNOW THEY DON'T HAVE ENOUGH
TICKETS TO SELL TO EVERYBODY
THAT'S IN THAT LINE. I THINK IF
PEOPLE WERE BUYING IPHONES THAT
WAY, THEY'D BE HIGHLY FRUSTRATED
BECAUSE THERE'S CLEARLY A BETTER
WAY TO MAKE HIGH DEMAND PRODUCTS
AVAILABLE FOR SALE. YET IN THE
TICKETING MARKET, THAT'S HOW
IT'S WORKED FOR A LONG TIME. AND
WITH RESPECT TO TICKETS TODAY,
EIGHT OUT OF 10 TIMES THE PERSON
YOU'RE THE RETAILER. STANDING IN
LINE WITH IS TICKETMASTER AND
TICKETMASTER HAS BEEN ABLE TO
CREATE SUCH A DOMINANT FORCE IN
OUR INDUSTRY, BECAUSE NOT ONLY
DO THEY SELL TICKETS, BUT THEY
ALSO CONTROL DOWNSTREAM A LOT OF
OTHER ASPECTS OF THE INDUSTRY AS
WELL THROUGH LIVE NATION. SO
WHEN YOU SAW THAT CHART TALKING
ABOUT THE ARTIST PROMOTER, THE
VENUE, THE TICKET SELLER THINK
LIVE NATION LIVE NATION
TICKETMASTER, BECAUSE WHAT YOU
HAVE HERE IS A COMPANY THAT
MANAGES ARTISTS. THAT IS THE
LARGEST PRODUCER OF MUSIC TOURS
IN THE WORLD THAT OWNS OR
OPERATES EXCLUSIVELY TICKETING.
UM AND TICKETS VENUES, SOME,
WHICH THEY OWN, SOME, WHICH THEY
OPERATE SO MUCH THEY EXCLUSIVELY
UM, PROVIDE TICKETS TO AND ONCE
THE AN EVENT GOES TO THAT VENUE,
THEY'RE THEN THE RETAILER OF
RECORD RIGHT AND UNFORTUNATELY,
WE CAN'T FORGET THAT THEY'RE
ALSO IN THE RESALE BUSINESS AS
WELL AND SO THEY CAN USE TERMS
AND CONDITIONS AND THEY CAN USE
TECHNOLOGY TO RESTRICT RESALE
ALTOGETHER. NÓ OPTION YOU CAN'T
RESELL SORRY. NON REFUNDABLE,
NON TRANSFERABLE. OR MORE
FREQUENTLY. MAKE SURE THAT THAT
RESALE TRANSACTION HAPPENS ON
THEIR PLATFORM, SO NOT ONLY AND
SOMETIMES, ARE THEY PROFITING
FROM THE RESALE FROM A FINANCIAL
PERSPECTIVE, BUT THEY'RE ALWAYS
PROFITING FROM A DATA
PERSPECTIVE, BECAUSE IN ORDER TO
GET THAT TICKET, YOU HAVE TO GO
AND MAKE A TRANSACTION AND GIVE
YOUR DATA TO TICKETMASTER IN
ORDER TO RECEIVE IT AND ENTER
THE VENUE. SO WHEN WE THINK
ABOUT THAT DOMINANT ECOSYSTEM,
THIS ONE THAT'S ENTIRELY
CONTROLLED BY ONE ENTITY.
THEY'RE CONTROLLING. WHO GETS TO
BUY THE TICKET? ARE YOU A
VERIFIED FAN? THAT'S UP TO THEM?
ARE YOU? DO YOU HAVE THE RIGHT
CREDIT CARD TO GET EARLY ACCESS
TO THE TICKET AGAIN? IT'S UP TO
THEM, RIGHT? WHAT WHAT ARE THE
TERMS AND CONDITIONS OF THAT
SALE IS THE TICKET RESELL. I
DON'T KNOW AGAIN. IT'S UP TO
THAT OTHER STATES HAVE SAID YES,
THOSE TICKETS HAVE TO BE
RESALABLE. BUT THAT'S NOT A
RIGHT THAT EXISTS IN CALIFORNIA
TODAY, UM, WHERE THE VENUE UH,
WHERE THE TOUR GOES UP TO THE
PROMOTER. THAT'S THEM WHEN THE
TICKETS BECOME AVAILABLE FOR
SALE, HOW THAT SUPPLY IS
RELEASED INTO THE MARKETPLACE
CAN THAT SUPPLY BE MANIPULATED?
TO CREATE A SENSE OF FALSE
SCARCITY TO INCREASE PRICES IN A
DYNAMICALLY PRICED SYSTEM. YES
AGAIN ALL OF THAT. SO WHEN WE'RE
TALKING ABOUT THESE DECISIONS
BEING MADE IN A VACUUM, WE'RE
TALKING ABOUT IT IN THE SENSE
THAT THERE'S NÓ COMPETITION TO
ACT AS A CHECK OR A BALANCE AND
MOST CONCERNING, WE ALSO KNOW
THROUGH REPORTS FROM THE
DEPARTMENT OF JUSTICE THAT WHEN
PEOPLE CHOOSE NOT TO PLAY LAWN
OR FALL IN LINE THEY'VE BEEN
RETALIATED AGAINST AS WELL FOR
NOT PARTICIPATING IN THIS
ECOSYSTEM. SO WE BELIEVE THAT
THE FIRST STEP TOWARD REFORMING
OUR INDUSTRY NEEDS TO START WITH
OPENING THIS MARKETPLACE TO
COMPETITION, COMPETITION AND
CONSUMER CHOICE IS GOING TO
ADDRESS A LOT OF THE ROOT CAUSES
OF WHAT WE'RE HEARING TODAY, AND
IT WOULD BE REMISS IF WE DIDN'T
SAY THAT THERE'S DOWNSTREAM
PROBLEMS AS WELL. THAT IMPACT
THE RESALE INDUSTRY AND A LOT OF
CONSUMER FRUSTRATIONS THAT
CONSUMERS PROBABLY HAVE ABOUT
RESALE AS WELL. SO WANTS TO BE A
PARTICIPANT IN THOSE
CONVERSATIONS, AND WE BELIEVE
THAT WE CAN HAVE THEM IN
PARALLEL TO A CONVERSATION. NOT
IN LIE TO A CONVERSATION OF
THOSE ROOT CAUSES ABOUT
COMPETITION. SO IF WE CAN SOLVE
THESE PROBLEMS COMPREHENSIVELY
AND LOOK AT THE INDUSTRY FROM
START TO FINISH, AS OPPOSED TO
JUST POINTING FINGERS TO THE
RESALE MARKET, WE THINK IT'LL BE
A BETTER OVERALL OUTCOME FOR
CONSUMERS IN CALIFORNIA, SO IF
WE CAN EMPOWER THOSE CONSUMERS
WITH CHOICE AND HAVE THEM BE A
PART OF THIS TRANSACTION, WE
BELIEVE WE'RE GONNA CREATE A
HEALTHIER AND SAFER MARKETPLACE
FOR PEOPLE IN CALIFORNIA, AND WE
CERTAINLY BELIEVE THE CALIFORNIA
LEGISLATURE IS IN A POSITION TO
DO THAT, AND TO INNOVATE ON
BEHALF OF CONSUMERS IN OUR SO
THANK YOU VERY MUCH. THANK YOU
FOR, UH, OK. YEAH. FOR THE LAST
OF THE PANEL, ROBERT FROM TICKER
. WE HAVE YOUR SLIDES HERE. I
DON'T KNOW IF THEY'RE ALSO GOING
TO BE GREAT. THANK YOU. THERE.
ALL RIGHT, UM GLAD TO BE HERE.
THANK YOU FOR THANK YOU FOR
HAVING ME. UH AND FIRST AND
FOREMOST, THANK YOU FOR DOING
THIS BECAUSE IT'S UH, YOU KNOW,
IT'S A VALIDATION OF JUST HOW
IMPORTANT THE LIVE EXPERIENCE IS
TO PEOPLE. UM IT'S INNATE TO THE
HUMAN CONDITION. UM WE ALL
LEARNED THAT DURING COVID WHEN
WE WERE LOCKED UP RIGHT AND
THANK YOU FOR THE GREAT
BACKGROUND PAPER. I, UH YOU
KNOW, I AGREE WITH WITH MY
COLLEAGUE HERE. IT WAS
PHENOMENAL. AND WE ACTUALLY MADE
IT MANDATORY READING FOR OUR
ENTIRE COMPANY THIS MORNING.
THAT'S HOW THAT'S HOW GOOD I
THAT'S HOW GOOD I REALLY THOUGHT
IT WAS, UM I LOOK A LITTLE BIT
ABOUT US. SO WE ARE. A GROUP OF
CALIFORNIANS ALSO WERE FOUNDED
IN CALIFORNIA. UH MY BUSINESS
PARTNER AND I WENT TO THE
UNIVERSITY OF CALIFORNIA, LOS
ANGELES. SO WE'RE VERY MUCH
ROOTED IN THE STATE. SO TO BE
HERE SPEAKING TO YOU GUYS IS
REALLY COOL. UM AND THE STORY OF
TAR IS WE ARE FANS. RIGHT. WE
ARE. WE ARE NOT THE INDUSTRY. WE
ARE FANS AND WE ARE FANS THAT
ALSO HAPPEN TO BE PRODUCT
ENGINEERS. AND THE REASON WE
FOUNDED THIS COMPANY AND WHY I
THINK IT'S SO IMPORTANT FOR US
TO BE HERE AND FOR YOU GUYS TO
HEAR A COMPLETELY DIFFERENT
PERSPECTIVE ON YOU KNOW WHAT'S
BEEN LAID OUT TODAY, WHICH, BY
THE WAY, A LOT OF IT IS, YOU
KNOW, ALL OF IT IS FACTUAL. IS
AS FANS AND ENGINEERS. WE FACE
THE SAME PROBLEMS THAT I THINK,
UM, THE FOUNDER OF STUBHUB DID
BACK AND THEY APPROACHED IN A
DIFFERENT WAY. RIGHT WHEN WE
LOOKED AT WHY ARE THERE BOTS?
WHY ARE SITES CRASHING? YOU KNOW
WHY CAN'T WE OURSELVES, NOT GET
TICKETS? WHY ARE WE PAYING ALL
THESE FEES ON THE SECONDARY
MARKET? UM WE NOTICED TWO THINGS
THAT ARE FUNDAMENTAL RIGHT AND
ARE IMPORTANT AGAIN TO
UNDERSTAND. WHAT IS THE SYSTEMS
THAT DOMINATE THE TICKETING
INDUSTRY TODAY ARE VERY, VERY
ANTIQUATED. SOME OF THESE
SYSTEMS HAVE CORE TECHNOLOGY
THAT WAS BUILT OVER 40 YEARS AGO
. AND YOU DON'T SEE THAT IN A
LOT OF INDUSTRIES TODAY BECAUSE
A LOT OF INDUSTRIES TODAY ARE
ARE BEST PRODUCT WINS AND ITS
CONSUMER CHOICE THAT DICTATES
THOSE RIGHT BECAUSE OF A VARIETY
OF FACTORS, WHICH I'LL GET INTO.
THAT'S BEEN THE CASE. SO FIRST
AND FOREMOST, WE SAID TO
OURSELVES WELL. YOU KNOW SYSTEM
CRASHING IT ON SALE OR BOTS OR
ALL OF THIS PRICING. UM,
INEFFICIENCY YOU THE FIRST THING
YOU NEED TO DO IS BUILD A NEW
SYSTEM. AND BUILD A SYSTEM WITH
NEW MODERN TECHNOLOGIES THAT DID
NOT EXIST 40 YEARS AGO, AND YOU
KNOW, AND LOOK, YOU COULD
RENOVATE THINGS, BUT BUILDING IT
FROM THE GROUND UP IS A
COMPLETELY DIFFERENT BALL GAME.
THE SECOND THING WE REALIZED IS
THE MARKET INEFFICIENCY PROBLEM
IS JUST THAT AND THAT AND THAT
THE SECONDARY MARKET VERSUS THE
PRIMARY, WHICH YOU KNOW IS
REALLY THE FOCUS. THAT'S NOT THE
ONLY SOLUTION. THERE ARE THINGS
THAT YOU CAN DO IF YOU INNOVATE
RIGHT, AND YOU THINK OF THE
PROBLEM IN DIFFERENT WAYS THAT
CAN CREATE NEW SOLUTIONS TO
THESE THINGS. AND THAT'S WHAT WE
SET OUT TO DO. UM AND WE
BOOTSTRAPPED THE COMPANY BECAUSE
FRANKLY, FUNDRAISING WAS
DIFFICULT. UM, WE WILL TALK
ABOUT THAT. BUT CAPITAL INTO
THIS INDUSTRY IS VERY DIFFICULT
TO COME BY. BECAUSE THE DYNAMICS
OF THE INDUSTRY UM I WAS LUCKY
TO FIND ANOTHER COMPANY. I WAS
ABLE TO SELF FINANCE IT. UM WE
HIRED A GREAT TEAM OF ENGINEERS,
AND WE JUST SET OUT TO BUILD
SOMETHING NEW BECAUSE WE THOUGHT
IT WAS THE RIGHT THING TO DO OK?
AND BUT IF YOU IF YOU GO TO THE
NEXT SLIDE NEXT SLIDE AND WE
FIRST OFF SET OUT TO BUILD A NEW
SYSTEM RIGHT ONE THAT AGAIN IS
BUILT ON GREAT ARCHITECTURE
LOOKS BEAUTIFUL LOOKS AND FEELS
LIKE THE SYSTEMS OF TODAY
BECAUSE WE BELIEVE FANS REALLY
WANT TWO THINGS. FIRST THEY WANT
A GREAT EXPERIENCE, AND THEY'RE
USED TO HAVING GREAT EXPERIENCES
ON UBER AND GRUBHUB AND THESE
NEW MODERN SYSTEMS THAT HAVE
RULED OUT OVER THE LAST 510
YEARS, ESPECIALLY MOBILE
EXPERIENCE, AND NUMBER TWO IS
AND IF YOU GO TO THE NEXT SLIDE
AS WE SET OUT TO INNOVATE. RIGHT
SO WE'VE ROLLED OUT AND I'LL
GIVE YOU GUYS A COUPLE OF
EXAMPLES OF THIS, BUT TOOLS
AROUND BEHAVIORAL PRICING THAT
THE PROFESSOR MENTIONED IS
REALLY IMPORTANT. DYNAMIC
PRICING PAYMENT PLANS, WHICH
GIVE MORE ACCESSIBILITY TO FANS
BEING ABLE TO BREAK UP PAYMENTS,
INSTALLMENTS AND ON AND ON AND
ON. BUT OVER THE COURSE OF THE
10 YEARS, WE'VE BEEN IN BUSINESS
WHICH YOU KNOW WE ARE THE BABIES
IN THE INDUSTRY. WE ARE
CONSTANTLY ROLLING OUT NEW
INNOVATIONS THAT ARE INCREDIBLY
RAPID PACE. UM AND NOT ONLY HAVE
WE CAUGHT UP WITH THE LEGACY IN
TERMS OF A LOT OF THE CORE
REQUIREMENTS TO HANDLE A
FESTIVAL OR AN ARENA, AND WE
ACTUALLY DO IT GLOBALLY, BUT
WE'RE NOW BRINGING THINGS TO
MARKET THAT HAVE NEVER EXISTED
BEFORE THAT CHANGED THE DYNAMICS
OF THE BUSINESS, ALL RIGHT. I'M
I'M I'M GONNA GIVE YOU GUYS A
COUPLE MORE THINGS. UH, NEXT
SLIDE. AND THE OTHER PIECES. WE
ARE A PURE PLAY TECHNOLOGY
COMPANY, RIGHT? WE ARE NOT A
PROMOTER. WE ARE AND AS A MATTER
OF FACT, IT'S PART OF OUR ETHOS
AND WE HAVE TURNED DOWN OFFERS
FOR BEING ACQUIRED. WE'VE TURNED
DOWN OUR INVEST IN PROMOTION
COMPANIES BECAUSE WE BELIEVE
THAT AS LONG AS WE ARE HERE AS A
TECHNOLOGY, WE'RE HERE TO SOLVE
PROBLEMS, AND WE SHOULD NOT HAVE
ANY BIAS TOWARDS ONE SIDE OR
ANOTHER. RIGHT WE PURELY JUST
WANNA WANNA SOLVE AND WE'RE ALSO
DATA NEUTRAL, RIGHT? THE DATA
THAT AN ARTIST GETS OR PROMOTER
GETS THAT WORKS ON OUR SYSTEM IS
NOT SHARED. IT'S NOT RESOLD, AND
IT'S JUST PART OF OUR CORE ETHOS
TO BE A PURE PLAY TECHNOLOGY
COMPANY, WHICH I THINK IS VERY,
VERY IMPORTANT TO UNDERSTAND.
UM, NEXT SLIDE. AND I WANNA GIVE
YOU GUYS AN EXAMPLE OF HOW ALL
THIS MANIFEST RIGHT? SO, UM
PRETTY LIKE, UH, ARTIST THAT WAS
IN HIBERNATION FOR A WHILE,
PHENOMENAL ELECTRONIC MUSIC
ARTIST AND HE HAPPENED ON HIS. I
THINK IT WAS A 15 OR 20 CITY
TOUR TO ROUTE THROUGH TWO OF OUR
VENUES RIGHT AND THERE'S A GREAT
OPPORTUNITY FOR US TO CONTRAST
OUR TECHNOLOGY WITH YOU KNOW
WHAT? WHAT LEGACY SYSTEMS THAT
WERE THE OTHER STOPS YOU TO RUN.
AND WHAT WE DID WAS A LITTLE BIT
DIFFERENT. WE YOU KNOW, WE FIRST
OF ALL WE GATED? UM AND MADE
SURE ONLY SPECIFIC FANS COME IN,
AND THAT THAT THEY'RE LIKE FAN
CLUB MEMBERS. BUT THEN WE
BECAUSE OUR SYSTEM IS ABLE TO
SCALE AND WE DON'T HAVE THOSE
LIKE QUEUES WHERE PEOPLE HAVE TO
WAIT IN LINE AND SEE YOUR
NUMBER. 100 OUT OF 500. WE BUILT
THE SYSTEM TO HANDLE A
TREMENDOUS AMOUNT OF VOLUME
SIMULTANEOUSLY. SO MY FAN
EXPERIENCE IF YOU GO ON THE
SITE, YOU'RE NOT WAITING. YOU
COULD JUST TRANSACT RIGHT? AND
THESE TICKETS SOLD OUT
INCREDIBLY FAST. WHICH ON MOST
SYSTEMS YOU WOULD SHOW SOLD OUT.
PEOPLE WOULD JUMP ON TO SECOND
YEAR TO TRY TO GET TICKETS
BECAUSE THEY CAN'T GET THEM. BUT
WE BUILT THIS UNIQUE TECHNOLOGY,
WHICH IS ONE OF THE FEW
INNOVATIONS WE ROLLED OUT CALLED
WAITLIST, AND HOW THAT WORKS IS
WHEN AN EVENT SELLS OUT IN REAL
TIME, WE CAN START PRE
AUTHORIZING PEOPLE'S CREDIT
CARDS, SO THEY HAVE A CHANCE TO
GET A TICKET. RIGHT AND BECAUSE
YOU DO THAT YOU DO A COUPLE
THINGS. FIRST OF ALL SCALPERS.
THEY DON'T HAVE AS MUCH OF AN
OPPORTUNITY TO GET ON OUR SET
BECAUSE WE'RE VERY GOOD AT
FIGHTING THAT, BUT ONCE YOU HAVE
THE WAITLIST, WHAT WE DID IN
THIS PARTICULAR CASE IS ONCE THE
EVENT SOLD OUT, AND WE HAD
PEOPLE AGAIN WITH THEIR CREDIT
CARDS ON FILE. THE PROMOTER WAS
TOTALLY OK WITH US GOING IN AND
SCRAPING. EVERYBODY THAT HAD
BOUGHT AND WE REMOVED ANYBODY
THAT LOOKS EVEN REMOTELY
SUSPICIOUS AND THE NET RESULT
WAS VIRTUALLY NÓ SCALPING. NÓ
SECONDARY MARKET AND TRUE FANS
GOT TICKETS. THERE'S ACTUALLY
READ A THREAD WITH PRETTY LIGHT
FANS WHERE THEY'RE, LIKE BLOWING
UP AND EXCITED THAT. OH, MY GOD,
I ACTUALLY GOT TICKETS ON TIX,
RIGHT? AND THIS HAPPENED BECAUSE
OUR ABILITY IS THERE AND IT'S A
VERY REALLY, REALLY IMPORTANT
POINT. WE HAVE NEW TECHNOLOGY
AND WE'RE VERY FLEXIBLE TO MAKE
CHANGES AND ADJUSTMENTS TO
MARKET CONDITIONS IN REAL TIME,
AND THE MOTIVATION IS THAT WE
GENUINELY WANT TO SOLVE. THE
FANS ISSUES ALL THE ISSUES THAT
HAVE PLAGUED US TODAY THAT THANK
YOU TO TAYLOR SWIFT FOR BRINGING
US HERE AGAIN, UM, SAME ISSUES
AS WHEN I FOUNDED THE COMPANY 10
YEARS AGO. RIGHT, SO NOTHING HAS
CHANGED MATERIALLY, RIGHT? SO
THE QUESTION IS. WELL, WHAT CAN
LEGISLATURE DO TO HELP THIS
RIGHT? UM THERE ARE A LOT OF
DIFFERENT APPROACHES. BUT I
THINK FIRST OF ALL YOU YOU
GENUINELY NEED TO SIDE ON THE
SIDE OF, UM, INNOVATION. WE CAN
SOLVE THESE PROBLEMS. THERE ARE
A LOT OF BRIGHT MINDS, UM, IN
CALIFORNIA AND IN THE REST OF
THE WORLD. THIS IS SOMETHING
PEOPLE ARE PASSIONATE ABOUT.
THEY DON'T APPROACH THIS BECAUSE
CAPITAL IS HARD TO COME BY. IT'S
A DAUNTING BUILD. IT'S TAKEN US
A DECADE TO GET TO THIS POINT,
NOT EVERYBODY'S GOT THAT KINDA
INSANE STAMINA. UM AND THE
DYNAMICS IN THIS INDUSTRY
GENERALLY DO NEED TO CHANGE IN
ORDER FOR INNOVATION TO BREAK
OUT RIGHT, SO EXCLUSIVITY, FOR
EXAMPLE, AT THE VENUE LEVEL IS
AN INTERESTING TOPIC. IF MORE
VENUES WERE ACCESSIBLE, MORE
INDEPENDENT PROMOTERS AND
ARTISTS WOULD BE ABLE TO PICK
THEIR OWN TICKETING SYSTEM,
WHICH OPENS UP MORE PRIMARY
TICKETING OPPORTUNITIES. UM ALSO
THIS COMBINATION OF THE
PROMOTERS WHICH TAKE UP A LOT OF
THE INVENTORY PICK IN THEIR
TICKETING SYSTEM THAT ALSO MAKES
IT VERY CHALLENGING. AND YOU
KNOW, WE'VE LEARNED THIS
FIRSTHAND AS PROMOTERS, YOU
KNOW, AND IT'S NOT JUST THE
BIGGEST, BUT IT HAPPENS ACROSS
ACROSS SOME THE WIDER MARKET AS
THEY BUY MORE AND MORE MARKET
SHARE. THEY NATURALLY PUT PEOPLE
ON THEIR OWN TICKETING SYSTEMS
THAT OFTENTIMES OR LEGACY AND IT
CAUSES A LOT OF THESE MACRO
ISSUES, RIGHT. UM YEAH. I'LL
CLOSE OFF SAYING THANK YOU FOR
HAVING ME. I'M HERE TO ANSWER
QUESTIONS AND, UM, YOU KNOW,
APPRECIATE THE CONVERSATION.
THANK YOU SO MUCH. ASSEMBLY
MEMBER WIX AND THEN SO I
REMEMBER IRWIN AFTER THANK YOU.
00 SHE? YEAH WORKS AND THEN
YEAH. THANK YOU, MADAM CHAIR. I
DO HAVE TO. I'M SUPPOSED TO BE
AT AN EVENT ABOUT 10 MINUTES
AGO, BUT I WAS SO CAPTIVATED BY
THE CONVERSATION. UM SO, MISTER
DAVARI. SO BASICALLY, IF I
UNDERSTAND WHAT YOU'RE TELLING
US IS THAT YOU ALL HAVE THE
TECHNOLOGY TO SOLVE THE BOT
PROBLEM AND YOU FEEL LIKE THAT'S
A DOABLE THING. YEAH, I MEAN,
LOOK, IT'S A CAT AND MOUSE GAME,
RIGHT? BUT WE BELIEVE THAT
BECAUSE WE'RE ABLE TO MOVE
FASTER THAN OTHERS, AND WE'RE
WE'RE WE WE'RE BUILT ON NEWER,
MODERN TECHNOLOGY, RIGHT? WE
HAVE A BETTER CHANCE OF BEATING
THEM. WE'VE HISTORICALLY BEEN
ABLE TO DO THAT. AND THESE ARE
LOOK, ALL OF THESE THINGS ARE
SOLVABLE WITH PRODUCT. RIGHT
LEGISLATION SHOULD SIMPLY ALLOW
THE PRODUCTS TO THRIVE, AND
HOPEFULLY THERE'LL BE MORE
TICKERS OUT THERE BECAUSE WE
JUST YOU KNOW WE WANT WE WANNA
SOLVE PROBLEMS. THAT'S WHY WE'RE
HERE. I ASSUME ALSO WHEN THERE'S
EXCLUSIVITY ON THE VENUE THAT
MAKES IT DIFFICULT FOR YOU GUYS
TO PARTICIPATE, RIGHT? THAT'S
ANOTHER ISSUE THAT YEAH, I MEAN,
WE HAVE OUR OWN VENUE
EXCLUSIVELY AND WE HAVE VENUE
CLIENTS THAT ARE PHENOMENAL,
RIGHT? BUT UM, BUT IT IS TRUE
THAT IF AN ARTIST OR EVEN AN
INDEPENDENT PROMOTER WANTS TO GO
INTO, SAY, CHASE CENTER HERE IN
SAN FRANCISCO, THEY CANNOT DO
THAT. RIGHT AND BECAUSE THERE
ARE CERTAIN COMPANIES THAT
CONTROL SO MANY OF THE VENUES IT
CREATES A VERY LOW CEILING AND
BARRIER TO BEING ABLE TO
ACTUALLY GET INTO THOSE VENUES.
THANK YOU. SO IF THE IF THE
TECHNOLOGY EXISTS TO
FUNDAMENTALLY ADDRESS THE BOT
ISSUE, WHICH I THINK IS AN
IMPORTANT ONE, THEN, UM, MR
WALL, HOW COME TO MASTER DOESN'T
DEPLOY THAT? WE DEPLOY THE MOST
SOPHISTICATED ANTI BOT
TECHNOLOGY IN IN IN THE PLANET.
WE SPEND MORE ON ANTI BOT, UH,
TECHNOLOGY THAN THE REST OF THE
WORLD COMBINED. UH, IT IS THE
CAT AND MOUSE GAME THAT HE
MENTIONED. IT'S AN ARMS RACE
WHEN WE WHEN WE DEPLOY SOMETHING
THAT WORKS, UM, THE RESALE WORLD
IMMEDIATELY STARTS WORKING, UH,
ON AN ALTERNATIVE TO IT. WE HAVE
COME UP WITH, UM, I MEAN,
VERIFIED FAN IS A WONDERFUL
PRODUCT. WHAT? WHAT WHAT'S
HAPPENING IN IN THE ADVENT OF
VERIFIED FAN YOU, YOU SEE, UH,
TICKET BROKE BROKERS,
CROWDSOURCING PEOPLE TO, UH,
CREATE FAKE VERIFIED FAN
ACCOUNTS. IT IS THE WORLD WE
LIVE IN, AND IT'S THE WORLD THAT
ALL OF US ARE GOING TO LIVE IN
AS AS LONG AS WE TURN A BLIND
EYE TO THIS RUNAWAY RESALE
MARKET THAT THAT WE HAVE AND DO
YOU ALL THINK THAT YOU IT'S A
PRIORITY FOR YOU ALL TO STOP THE
BOTS, AND THAT'S A THAT'S A
COMPANY. TOP DOWN PRIORITY THAT
II I CAN. I CAN ASSURE YOU THAT
NOT ONLY IS IT A TOP PRIORITY,
UM BUT ALL YOU HAVE TO DO IS GET
THE WRATH OF THE SWIFTIES. AND
IT WILL BE A TOP PRIORITY
FOREVER AND EVER. AND JUST ON
THE I KNOW TICKETMASTER REQUIRES
EXCLUSIVITY WITH REGARD TO
TICKET SALES AT AT IT. THAT'S
THE THAT'S THE COMMON WAY THAT
TICKETING CONTRACTS HAVE BEEN
SOLD FOR 40 OR 50 YEARS. SO YOU
BUT YOU DO YOU DO REQUIRE IT OR
YOU DON'T REQUIRE IT IT IT'S
VENUE DRIVEN. IT'S NOT. IT'S NOT
DRIVEN BY US VENUES PREFER TO
SELL THEIR TICKETING RIGHTS TO
AUCTION THEM OFF TO TICKETING
COMPANIES UNDER A WINNER TAKE
ALL AUCTION, WHICH PUTS THE
MAXIMUM COMPETITIVE PRESSURE ON
THE ON THE TICKETING COMPANIES.
YOU THE OPPOSITION TO THE BILLS
THAT WOULD RESTRICT EXCLUSIVITY.
IT'S NOT GOING TO COME FROM US
OR FROM ANY OTHER PRIMARY
TICKETING COMPANY IT, IT'S GOING
TO COME ALMOST UNANIMOUS. FROM
THE VENUE COMMITTEE COMMUNITY. I
JUST WAS REF REFERENCING A WALL
STREET JOURNAL ARTICLE, WHICH I
GUESS SAID THAT YOU ALL WERE
REQUIRING THAT BUT MAYBE THAT
ISN'T CORRECT OR WE HAVE NON
EXCLUSIVE ARRANGEMENTS. WE ARE
VERY RARELY ASKED TO BID ON A
NONEXCLUSIVE BASIS. IT ALMOST
NEVER HAPPENS. GOT IT. OK, SO
YOU GUYS ARE OPEN TO ELIMINATING
ELIMINATING THAT EXCLUSIVITY. WE
DEFEND EXCLUSIVITY BECAUSE OUR
CLIENTS WANT US TO DEFEND IT.
THE VENUES, IT'S THEIR ISSUE.
IT'S NOT OUR ISSUE. IT'S THE
VENUE'S ISSUE. GOT IT SO YOU
WOULDN'T BE OPEN TO GETTING RID
OF IT. HUH? IF YOU CAN CONVINCE
THE VENUE COMMUNITY TO GET RID
OF IT, WE WILL BE. WE WILL
THRIVE IN A WORLD WITHOUT
EXCLUSIVITY. IT'S NOT A PROBLEM.
OK, SO YOU WOULD SUPPORT IT.
WE'RE NOT GOING TO UNDERMINE OUR
OUR VENUES. WE'RE NOT GONNA DO
THAT. OK, SO YOU WOULDN'T OK.
THANK YOU, MADAM CHAIR. AND WE
ARE GONNA HEAR FROM THE VENUES
IN THE NEXT PANEL, SO UM YEAH,
MR IRWIN, AND THEN WE'LL GO TO.
I APPRECIATE THAT. YOU SAID YOU
SUPPORT ALL IN PRICING AND THAT
IT WAS EVEN ON YOUR SLIDE. BUT
YOU STILL DON'T HAVE ALL IN
PRICING. SO ARE YOU LOOKING FOR
THE, UH, JUNE DEADLINE? WHEN CAN
WE EXPECT TICKETMASTER TO HAVE
ALL IN PRICES SO TICKETMASTER?
WE'RE TICKET MASTER. WE'RE LIVE
NATION IS ABLE TO CONTROL THAT
THE PRICING AND THE AND THE WAY
THAT THE PRICING IS PRESENTED,
WHICH IS ON OUR OWNED AND
OPERATED VENUES. IT'S ALREADY IN
EFFECT. IT'S ALREADY BEEN DONE.
WE DID THAT PURSUANT TO A
COMMITMENT THAT WE MADE TO
PRESIDENT BIDEN LAST YEAR, BUT
THE TICKETING COMPANY DOESN'T
GET TO DECIDE. UM THIS FOR THE
ARTISTS IN THE IN THE TEAMS. WE
NEED TO GET THE SPORTS TEAMS.
UH, IF THE SPORTS TEAMS IF THE
IF THE IF A LEAGUE CAME TO US
AND SAID WE WANT YOU TO DO ALL
IN PRICING, WE WOULD DO IT
TOMORROW. THIS IS ONE OF THE
REASONS AND SOME OF THEM KNOWS
ALL ABOUT THIS. STUBHUB WENT OUT
AT IN TO ITS CREDIT, TRIED TO
CHANGE THE MODEL AND GO TO ALL
IN PRICING AND IT WAS HAMMERED
COMPETITIVELY. UM, WHEN IT WHEN
IT DID IT, UM, WE NEED
LEGISLATION THAT MAKES EVERYBODY
DO IT SO THAT EVERYBODY DOES IT.
AND THERE'S NÓ COMPETITIVE
BENEFIT FROM BEING A BAD ACTOR.
OKAY, SO THAT WAS I SO YOU SAID
THE DEADLINE FOR THAT IS JUNE.
THAT'S WHEN THE CALIFORNIA
DEADLINE IS UNDER THE RECENT
LEGISLATION. ABSOLUTELY, YES, OK
AND THEN AND THEN, UM, IF WE'RE
LOOKING AT DYNAMIC PRICING, AND
MAYBE IT'S FOR, UM, BOTH OF YOU.
HOW DO WE KNOW THAT? PRICES
AREN'T BEING UH, ARTIFICIALLY
INFLATED BY KEEPING TICKETS
BACK? WELL. FIRST OF ALL IN
TERMS OF DYNAMIC PRICING. ONE
THING THAT THAT I DO WANT TO
MAKE CLEAR WE DON'T DO THE
COMPUTER DRIVEN, UM, DYNAMIC
PRICING LIKE AIRLINES DO THAT
IT'S AUTOMATICALLY UPDATED FOUR
TIMES A DAY ACCORDING TO DEMAND
SO IT WHAT? WHAT TICKETMASTER
OFFERS ITS ITS CLIENTS IS A IS
AN ABILITY. UM TO, UM, MAKE
MANUAL ADJUSTMENTS TO THE
MANIFEST, UM, UP OR DOWN AND
SOME OTHER WAYS LIKE THAT, UM
THE OVERWHELMING UM, INCENTIVE
OF EVERYBODY IN THE CREATIVE
ECOSYSTEM IT PUTS ON A LIVE
ENTERTAINMENT EVENT IS TO MAKE
SURE THE SHOW SELLS OUT. THAT'S
HOW EVERYBODY MAKES MONEY IS YOU
GET THE SHOW TO SELL OUT AND THE
PROMOTER FIRST AND FOREMOST,
BECAUSE THE PROMOTER IS NOT
GOING TO MAKE ANY MONEY UNLESS
THE SHOW IS CLOSE TO A SELL OUT
THAT THAT NOBODY HOLDS BACK
INVENTORY. NOBODY UM HOLDS.
THAT'S A MYTH THAT HAS BEEN
GOING AROUND. WE DON'T HOLD BACK
INVENTORY. NOW INVENTORY IS NOW
FRAGMENTED INTO VARIOUS KINDS OF
PRE SALES AND THINGS LIKE THAT,
BECAUSE THE EVENT ORGANIZERS
HAVE DECIDED TO SELL SOME OF THE
INVENTORY TO VISA AND SOME OF IT
TO AMERICAN EXPRESS AND THINGS
LIKE THAT, BUT INVENTORY IS NOT
HELD BACK. SO IF IT'S IF IT'S
BEING, UM, SOLD TO A VISA, I
MEAN IT IS THERE. IS THERE ANY
TRANSPARENCY ON HOW MANY TICKETS
MIGHT NOT BE SOLD YET? NÓ AND WE
OPPOSE THAT MANDATORY
TRANSPARENCY BECAUSE THE ONLY
PARTY IS IN THE ECOSYSTEM FOR
WHICH THAT HAS ANY VALUE OR
TICKET BROKERS. FOR EVERYBODY
ELSE. THEIR DECISION ON WHETHER
THEY WANNA GO SEE BEYONCE HAS
NOTHING TO DO WITH WHAT THE
SUPPLY OF AVAILABLE TICKETS IS.
AND THEN WITH YOUR TECHNOLOGY
ARE THERE TICKETS HELD BACK TO
SO FIRST OF ALL, WE DO HAVE
AUTOMATED DYNAMIC PRICING, WHICH
IS ONE OF THE MAJOR INNOVATIONS
WE BROUGHT ON. UM IT'S
CONTROLLED BY OUR CLIENTS. BUT
IT IS AUTOMATED RIGHT SO THAT IF
, IF THERE'S A SURGE, FOR
EXAMPLE, THE PRICE CAN GO UP AND
THE WHOLE GOAL OF THAT IS TO PUT
MORE MONEY IN THE POCKETS OF THE
PEOPLE THAT OWN AND CONTROL THE
TICKET, SO IT DOESN'T GO ON THE
SECONDARY MARKET. RIGHT UM, WITH
RESPECT TO HOLD. I MEAN, HOLD
ARE COMMON IN THE INDUSTRY,
RIGHT? THERE ARE HOLES ON UM,
IT'S TRUE. IT'S DICTATED BY THE
VENUE OR BY THE ARTIST. WE DON'T
AS A TICKETING COMPANY DICTATE
IT IF WE HAD TO REMOVE THAT. I
MEAN, I GUESS WE COULD. UM, BUT
I, BUT I WILL TELL YOU THAT IT'S
NOT COMMON FOR A LOT OF THE
TICKETS TO BE HELD. THEY ARE
KIND OF LIKE HERE AND THERE AND
THE CONCEPT THAT HE WAS
MENTIONING ABOUT THE PRESALES
AND ALL THAT KIND OF STUFF ARE
COMMON AND GENERALLY
ADVANTAGEOUS BECAUSE WHAT
THEY'RE USUALLY TRYING TO DO IS
EXPAND DISTRIBUTION LIKE AN AX
PRES SALE OR, YOU KNOW, WE DO A
LOT OF ARTIST DIRECT STUFF. THE
FESTIVAL OF ARTISTS AND THEY'LL
DO FAN CLUB PRE SALES TO KEEP
THE TICKETS IN THE HAND OF THE
FANS, SO IT'S NOT NECESSARILY A
BAD THING. I THINK WHAT'S MORE
IMPORTANT IS CREATING DYNAMICS
WHERE YOU WERE ABLE TO GET THEM
IN THE HANDS OF FANS THROUGH
MARKET OPTIMIZATION. YIELD
MANAGEMENT, MADAM CHAIR MAY I
MAY I MAKE A STATEMENT TO THIS
EFFECT OR SURE, SURE, GO AHEAD.
I WOULD JUST ADD THAT I THINK
WHEN WE TALK ABOUT HOLDBACKS, WE
SHOULD THINK ABOUT IT IN
DIFFERENT WAYS. JUST BECAUSE THE
TICKET DOESN'T GO ON SALE
IMMEDIATELY, DOESN'T MEAN IT'S
NOT BEING HELD BACK FOR THE
BENEFIT OF DYNAMIC PRICING. SO
IF YOU CAN IF YOU CAN DICTATE
WHEN THAT SUPPLY IS RELEASED,
EVEN IF THE ULTIMATE GOAL IS TO
RELEASE IT ALL BY HOLDING BACK
SOME OF THOSE INITIAL TICKETS AT
THAT IMMEDIATE MOMENT OF SALE TO
CREATE A SENSE OF FALSE SCARCITY
. YOU CAN THEN RELEASE TICKETS
TWO OR THREE WEEKS LATER, AND
THOSE PRICES MAY GO UP TO MEET
DEMAND. WE'VE SEEN THIS HAPPEN
QUITE A BIT WITH THE SECONDARY
MARKET OFTEN KIND OF BEING LIKE
THE MARKET CLEARING PRICE
DETERMINER AND THOSE TICKETS NOW
BEING RE-RELEASED LATER SELLING
THOSE PRICES GO UP. I WOULD SAY
WE DON'T OBJECT TO THE PRACTICE
BY ANY MEANS THAT TICKETS ARE
DISTRIBUTED AT THE DISCRETION OF
THE ARTIST. IN THAT SENSE, I
THINK OUR POINT OF VIEW IS IF
YOU'RE TRANSPARENT ABOUT IT, AND
YOU'RE A CONSUMER ON DAY ONE WHO
THINKS SOMETHING IS SOLD OUT. IF
THEY WERE TO KNOW IN THAT MOMENT
THAT ACTUALLY NÓ 1000 MORE
TICKETS ARE GONNA BECOME
AVAILABLE IN THREE OR FOUR
WEEKS. YOU MAY NOT PAY THAT
HIGHER PRICE IN THAT MOMENT. YOU
MAY JUST WAIT AND SEE WHAT
HAPPENS THREE OR FOUR WEEKS NOW
IN THAT NEXT ALLOCATION OF
TICKETS COMES OUT THAT IS VERY
COMMON, BUT I THINK IT'S FAIR TO
SAY THEY'RE NOT HELD BACK
EXCLUSIVELY OR ENTIRELY FROM THE
PUBLIC. THEY'RE JUST HELD BACK
IN REAL TIME, ONLY TO BE
RELEASED OR LIKE, UH, DRIPPED
INTO THE MARKETPLACE OVER TIME.
OK SO YOU YOU ARE, UM,
ADVOCATING FOR TRANSPARENCY AND
IN THE NOT A FALSE SCARCITY. OK
THAT'S UM SO I. I WAS GONNA MOVE
TO MY NEXT QUESTION. BUT PLEASE
ONE? YEAH I JUST WANTED ONE.
FOLLOW UP TO THAT BEFORE SHE
MOVES ON TO THE NEXT TOPIC. UM,
BUT WE'LL COME BACK TO YOU. UH,
SO, UM I THINK THAT AS I'VE SEEN
THE DRIP PRICING AND I KNOW THE
TEAMS CHOSE NOT TO BE HERE. BUT
THE TEAMS WERE ACTUALLY PRETTY
TRANSPARENT THAT THEY DO THIS.
UM AND LOOK, I MEAN, THE TEAMS
ARE BRINGING INCREDIBLE ECONOMIC
BENEFIT TO OUR COMMUNITIES, AND
SO THE ABILITY FOR THEM TO MAKE
MORE MONEY OR FILL THEIR
STADIUMS IS A POSITIVE THING. SO
I DON'T KNOW THAT I AGREE WITH
YOU. I DON'T THINK THAT WHOLE
BACKS ARE ALWAYS A PROBLEM. UM,
BUT I DO THINK WHERE I'VE SEEN
THE PROBLEM. AND THIS IS WHY I
WANTED TO COME BACK TO YOU. WITH
WHAT YOU SAID, IS IF I TRIED TO
BUY THOSE BAD BUNNY TICKETS ON
DAY ONE TO SPREAD THE LOVE
BETWEEN THE ARTISTS HERE, UM,
AND THEY APPEAR TO HAVE SOLD OUT
. BUT MY KID WAS HEART SET ON
IT, AND THEN I GO TO THE
SECONDARY MARKET, AND NOW IT'S
FIVE X. AND I DON'T KNOW MAURA
IS COMING, RIGHT? I'M GONNA
MAYBE PAY THAT FIVE X ONE I
WOULDN'T OTHERWISE. SO I SAW THE
BENEFIT IS IT ACTUALLY RELATED
TO DEPRESSING THE SECONDARY
MARKET? SO THIS IS INTERESTING
TO ME THAT YOU'RE SAYING THE
BROKERS ARE THE PRIMARY
BENEFICIARIES, SO I JUST WANTED
TO COME BACK TO THAT COMMENT YOU
MADE SO IT'S EXTREMELY VERY,
VERY RARE, UM, FOR TICKETS TO BE
HELD BACK FOR THAT KIND OF
PURPOSE TICKETS IN THE IN THE
NATURAL CYCLE OF A SHOW WILL
SOMETIMES BECOME AVAILABLE LATER
ON, BECAUSE THEY THEY DECIDE TO
CHANGE THE WAY THE STAGE IS
BUILT, AND THERE'S 1000 MORE
TICKETS AVAILABLE OR OR
SOMETHING LIKE THAT. BUT THE KEY
MOMENT OF DEMAND. FOR TICKETS IS
AT THE ON SALE. THAT'S THE PEAK
OF DEMAND. THAT'S WHEN YOU WANNA
HAVE EVERYTHING OUT THERE
AVAILABLE, UH, FOR SALE. UM UH,
IT'S A MYTH THAT THAT THERE IS A
STRATEGY OUT THERE THAT THAT
THAT SAYS WE'RE BANKING ON ON
THOSE TICKETS THAT THE PRIMARY
TICKETS ARE GOING TO GO EVEN
HIGHER LATER ON, AND SO WE WILL.
WE WILL HOLD THEM BACK. THAT'S
THAT'S NOT RATIONAL BEHAVIOR BY
BY A PROMOTER. TICKETING COMPANY
HAS NOTHING TO DO WITH IT, BUT
IT BUT IT'S NOT RATIONAL. YEAR
BY A PROMOTER OR AN ARTIST THAT
IF THE ARTIST HAS DECIDED THAT
THEY CAN GET $450 FOR THAT SEAT,
THEIR BEST CHANCE OF GETTING IT
IS IN THE BUZZ OF THE ON SALE,
RIGHT. BUT YOU SAID THE BROKERS
WOULD BE THE PRIMARY BENEFICIARY
OF THE DISCLOSURES. I DIDN'T
UNDERSTAND THAT BECAUSE BECAUSE
THE BROKERS AS AS AS YOU JUST
SAID ACTUALLY DETERMINE THE TRUE
MARKET CLEARING PRICE, WHICH IS
A FUNCTION OF WHAT SUPPLY AND
DEMAND. SO WHAT YOU WANT TO KNOW
IS SUPPLY. YOU WANT HALF THE
EQUATION? TRANSPARENCY GIVES YOU
SUPPLY. AND THAT ALLOWS YOU TO
MAKE A JUDGMENT ABOUT HOW MUCH
TO OFFER THOSE TICKETS FOR ON
THE ON THE SECONDARY MARKET, AND
THIS IS BEING DONE BY VERY
SOPHISTICATED PEOPLE. WE'RE NOT
IN THE DAYS OF BOB THE BROKER
ANYMORE. WHERE WE HAVE A AAA
COUPLE OF GUYS ARE REALLY
UNSOPHISTICATED DOING THIS.
THESE ARE COMPUTER SCIENCE
DRIVEN BROKERS WHO ARE FIGURING
THIS STUFF OUT AND LOOKING FOR
THE INFORMATION TO FIGURE ABOUT
HOW HIGH THEY CAN PRESS THESE
PRICES. OK DID YOU WANT TO
FOLLOW UP ON THIS POINT ABOUT
DRIP? OK BACK TO YOU SO I JUST
HAD A, UM, HOPEFULLY, THIS ONE
IS A QUICK QUESTION. SO IF I BUY
A TICKET, I PAID TICKETMASTER A
FEE. AND THEN IF I CAN'T GO AND
I HAVE TO SELL IT BACK, I PAY
PAY TICKET MASTER A FEE AND THEN
IF IT'S RESOLD, THEN TICKET
MASTER IS GETS A FEE. ALSO IS
THAT ACCURATE? IF YOU SELL IT ON
US, BUT BUT BUT SURE THERE'S A
COMPLETED TRANSACTION IN THE
PRIMARY MARKET IN MY EXAMPLE OF
$100 TICKET YOU PAID 100 AND 18.
IF IF YOU GO TO SELL THAT,
WHETHER YOU SELL IT ON US, OR
WILL YOU SELL IT ON ON? STOP UP
OR ANYTHING ELSE? UM WHAT'LL
HAPPEN IS YOU'LL BE SUBJECTED TO
A NEW FEE STRUCTURE. UM IF
YOU'RE IF YOU'RE A BROKER, YOU
WON'T YOU WON'T PAY A SELLER FEE
ON A RESALE SITE. BUT IF, BUT IF
YOU'RE A CONSUMER, YOU'LL PAY A
SELLER FEE AND THEN AND THEN
BUYER WILL WILL. PAY A BUYER
FEE. AND THEN WITH THE NEW
TECHNOLOGY, HOW HOW DO YOU
HANDLE SOMEBODY HAVING TO SO? SO
THIS IS A REALLY IMPORTANT THING
TO UNDERSTAND, AND SOME THAT WE
KIND OF HAVE FIGURED OUT OVER
TIME, BECAUSE AGAIN WE'RE WE'RE
RELATIVELY NEW TO THE MARKET.
THE AS YOU GO UPSCALE INTO THE
BIG ARENAS AND THE BIG SHOWS AND
SPORTS TEAMS AND STUFF LIKE THAT
. THE WAY TO DEAL DYNAMICS WORK
TO WIN. THESE BIG ACCOUNTS HAS
SWAYED HEAVILY TOWARDS THE
SECONDARY MARKET RIGHT. THE
SECONDARY MARKET HAS BECOME SO
DOMINANT AND THE FEES ARE SO
MUCH HIGHER. EVEN THE PRIMARY
SYSTEMS THAT ARE, YOU KNOW, UH,
CONTROLLING THE VENUES HAVE
BECOME FAR MORE INCENTIVE TO
MAKE MONEY ON THE SECONDARY THAN
ON THE ORIGINAL TRANSACTION.
RIGHT SO IN IN THAT WAY, WE'RE
VERY CONTRARIAN IN OUR THOUGHT
PROCESS TO THE EXISTING MARKET
DYNAMICS BECAUSE WE'RE ALL ABOUT
EFFICIENCY, SO WE'RE IN THE
PRIMARY, RIGHT? SO, FOR EXAMPLE,
WITH THE WAITLIST PRODUCT,
RIGHT? WHEN YOU WAITLIST
SOMEBODY, THEY JUST CHARGE A
NORMAL TRANSACTION FEE AND THE
FIRST TICKET GOES AWAY. THEY GET
A REFUND. THE NEXT PERSON GETS A
TICKET, RIGHT? THERE ISN'T ANY
ANY INCREMENTAL MARGIN FEE.
THAT'S 25 30% OR ANYTHING LIKE
THAT. RIGHT WHEREAS YOU KNOW,
SOMETIMES A PRIMARY SYSTEM WILL
TAKE A DOLLAR OF A VERY LITTLE
AMOUNT OF TICKET, BUT THEN
THEY'LL MAKE 20 25% ON THE
SECONDARY. THAT'S A REALLY,
REALLY, REALLY KEY POINT AND WHY
YOU'RE SEEING MORE INVENTORY AND
MORE OF THE CAPITAL SHIFTING TO
THE SECONDARY MARKET, BECAUSE,
FRANKLY, THE MARGINS ARE MUCH
HIGHER THERE. AND THEN MY DRESS
LAST QUESTION. AND MISS DOOLEY
MIGHT WANNA. I DON'T KNOW IF YOU
HAVE A RESPONSE TO WHAT THE
GENTLEMAN SAID. BUT UM, CAN YOU
TELL ME ABOUT THE RIGHTS THAT
CONSUMERS CURRENTLY HAVE WHEN
THEY PURCHASE A TICKET? YEAH, IT
DEPENDS ON WHERE YOU LIVE, AND
UNFORTUNATELY IN CALIFORNIA, THE
ANSWER IS NOT MANY, UM, IN A
STATE LIKE NEW YORK OR ILLINOIS.
UM COLORADO. THE LEGISLATURE HAS
A PIN UPON THE FACT THAT
CONSUMERS SHOULD HAVE SOME
RIGHTS WHEN THEY'RE PURCHASING
TICKETS, PARTICULARLY AROUND HOW
THEY USE THAT TICKET AFTER
PURCHASE. SO IF THEY LIKE TO
GIVE IT AWAY, UM IF THEY TO
RESELL IT. IF THEY ELECT TO DO
SOMETHING ELSE THEY'RE ABLE TO
DO SO WITHOUT RESTRICTION FROM,
UM, THE ORIGINAL TICKET SELLER
WHO SETS THE TERMS AND
CONDITIONS OF THAT ORIGINAL SALE
. UM SO THERE'S SIX STATES THAT
HAVE THAT OPPORTUNITY TODAY FOR
CONSUMERS. OK, SO YOU'RE SAYING
THAT CALIFORNIA IS IN THE LOWER
END OF CONSUMER PROTECTION?
UNFORTUNATELY I THINK THIS IS
ONE EXAMPLE WHERE CALIFORNIA HAS
NOT LED, BUT I THINK THERE'S AN
OPPORTUNITY BEFORE US TO REALLY
INNOVATE TOGETHER AND KIND OF
FIGURE OUT A BETTER WAY TO HAVE
THE SYSTEM OPERATE. THAT WAS A
LOT OF QUESTIONS. I APPRECIATE
YOUR PATIENCE, MR CHAIR TO THE
FAULT TO THE PREVIOUS, UM, UM,
SPEAKER WHAT STATES ARE LEADING
IN THIS SPACE? YEAH, WE WOULD.
WE WOULD POINT TO NEW YORK,
ILLINOIS AND COLORADO. UM, UTAH,
VIRGINIA AND CONNECTICUT ARE THE
OTHER THREE THAT HAVE THESE
THINGS, BUT I THINK ILLINOIS,
COLORADO AND NEW YORK NOT ONLY
TALK ABOUT THE RIGHT TO TRANSFER
, BUT THEY TALK ABOUT A WHOLE
HOST OF OTHER ISSUES AS WELL,
MANY OF WHICH ARE ALREADY IN
STATUTE IN CALIFORNIA. THAT
WOULD BE ONE ASPECT THAT WE
WOULD SAY CALIFORNIA HèA DOES
NOT HAVE TO MATCH THOSE OTHER
STATES RIGHT NOW. THE RIGHT TO
TRANSFER. THANK YOU FOR THANK
YOU FOR THAT. I'VE CERTAINLY
THOROUGHLY ENJOYED THIS ROBUST
CONVERSATION. A QUESTION FOR THE
PANEL DO SMALL, INDEPENDENT, UM,
VENUES FEEL PRESSURE TO WORK
WITH? èC SELLERS IN ORDER TO
GET ACCESS TO TALENT. WELL I
WOULD SAY THAT THAT THE NÓ THE
SMALL THE SMALLER VENUES THAT'S
THE MOST COMPETITIVE PART OF
THIS INDUSTRY IN ALL RESPECTS,
AND THROUGHOUT THE WHOLE PRODUCT
STACK. THERE'S MORE TICKETING
SOLUTIONS. THERE'S THOUSANDS OF
VENUES AND AS FOR OUR POSITION,
WE PROBABLY HAVE 200 OUT OF OVER
2000 VENUES IN IN IN IN THE
UNITED STATES AND THE THERE'S A
LOT MANY, MANY MORE CONCERT
PROMOTERS, UM, WORKING AT AT AT
THAT LEVEL OF THE MARKET. SO
WELL, I. I HEAR THAT I DON'T
UNDERSTAND LOGICALLY WHY THAT
WOULD BE TRUE. THANK YOU. COUPLE
COUPLE COUPLE OF COMMENTS. UM SO
NOT n
MARKET, RIGHT? THERE ARE A LOT
OF MORE INDEPENDENTS, UH, SOME
OF THE PROMOTERS THE LARGE SCALE
ONES THAT OWN TICKETING
COMPANIES. THEY ALSO OWN VENUES,
AND THEY'RE CONSTANTLY BUYING UP
NEW VENUES. SO THE ABILITY TO
TICKET THOSE OR YOU KNOW, OR UM
OR OR OR GIVE THEM, YOU KNOW,
FREEDOM TO DO SO IS BECOMING
MORE AND MORE LIMITED EVERY
SINGLE DAY THAT GOES BY, UH WHAT
I WOULD FOCUS ON THE LARGE
VENUES. THE LARGE VENUES ARE
MORTIFIED ABOUT LOSING CONCERTS.
IT'S JUST A FACT WHETHER IT'S
EXPLICIT OR IMPLICIT. UM AND
THAT THE LARGE VENUE LEVEL WHERE
MOST OF THE REVENUE RISES, MOST
OF THE ECONOMIC VALUE ALSO
RISES, TOO. GOT IT. WITH WITH
YOUR TECHNOLOGY SINCE YOU, UH,
OWN THIS COMPANY HAVE OTHER, UH.
TICKET BROKERS OR TICKET VENUES,
UM, NOT BEEN RECEPTIVE TO YOUR
NEW TECHNOLOGY. AND IF SO, WHY?
UH THAT'S A THAT'S A REALLY GOOD
QUESTION. I MEAN, THERE'S ALWAYS
FEAR, RIGHT FEAR ABOUT SOMETHING
NEW, OBVIOUSLY, AND NEW
TECHNOLOGY. THAT'S KIND OF A
COMMON THING. THERE'S INERTIA IN
THIS INDUSTRY. UM THERE ARE VERY
LONG TERM EXCLUSIVE CONTRACTS
LIKE WE MENTIONED SO SOMETIMES
AAA VENUE OR A FESTIVAL OR
WHATEVER IT IS MIGHT WANNA MOVE
OVER. BUT IT'S GONNA TAKE YEARS
FOR THEM TO BE ABLE TO ACTUALLY
DO THAT. BECAUSE THE NATURE OF
THE CONTRACTS UM AND THEN THERE
ARE I MEAN, YOU KNOW, WE'RE
WE'RE ONLY RECENTLY GETTING TO
THE SCALE WHERE WE'RE COMPETING
ON LIKE THE LARGE SCALE VENUES.
STUFF LIKE THAT, AND THERE IS A
FEAR ABOUT LOSING SHOWS. IT'S
JUST A FACT RIGHT? I'VE BEEN
WANTING TO DISRUPT THE LARGER
THE LARGER KIND OF DYNAMICS OF
THE INDUSTRY. SO WE'RE STARTING
TO DEFINITELY SEE THAT GOT IT.
THANK YOU. UM, SO ONE QUESTION
THAT I DON'T KNOW THAT WE'VE
TOUCHED ON QUITE AS MUCH IN THE
QUESTIONS AND I WANTED TO FOLLOW
UP ON WAS THE SPECULATIVE. PIECE
OF THE MARKET. UM AND I DON'T
KNOW IF OR YOU WANNA START
ALTHOUGH YOU ALSO HAVE. I DON'T
KNOW HOW YOU RESALE MARKET WORKS
. UM WE DON'T. WE DON'T PERMIT
IT. IT'S NOT ALLOWED ON
TICKETMASTER. UM, BUT I DO THINK
IT'S A PROBLEM NOW. I DID STAND
IN LINE IN COLLEGE FOR
BASKETBALL TICKETS FOR OTHER
PEOPLE. SO THIS IS AN AGE OLD
TRADITION RIGHT OF PEOPLE. UM
SPENDING THEIR TIME TO BUY
TICKETS. SO UH, I THINK I GET
THE BENEFIT RIGHT OF SOMEONE WHO
CAN'T IN THE MIDDLE OF THE DAY
LOG ON TO TICKETMASTER AND TRY
TO GET THESE TICKETS, BUT I ALSO
DO THINK THAT IT'S YOU KNOW,
WHEN YOU SEARCH FOR IT THE DAY
BEFORE, AND IT'S NOT CLEAR
YOU'RE NOT BUYING A REAL TICKET
THAT THAT'S NOT TRANSPARENCY AND
CONSUMER PROTECTION. SO I JUST
WANTED YOU TO TOUCH ON THAT.
YEAH, I'M HAPPY TO. I THINK I
WOULD WAIT TO SAY THAT, UM ONE
THING THAT I'D LIKE US ALL TO
THINK ABOUT IS WHAT IS THE
DEFINITION OF SPECULATIVE
TICKET? UM, I THINK IN MANY WAYS
IT'S BEEN DISCUSSED IS NOT
HAVING THAT TICKET IN YOUR
POSSESSION, AND IN MANY WAYS
THAT'S THAT CANNOT BE THE
DEFINITION OF A SPECULATIVE
TICKET BECAUSE OF HOW ORIGINAL
TICKETS ARE SOLD. YOU COULD PAY
FOR A TICKET MONTHS IN ADVANCE
BEFORE IT'S DELIVERED TO YOU, UH
, RIGHT BECAUSE OF DELIVERY
DELAYS THAT HAPPEN. AND SO IT'S
IMPORTANT WHEN WE THINK ABOUT
SPEC. IT'S ABOUT A TICKET THAT
YOU EITHER DON'T POSSESS OR YOU
HAVEN'T PURCHASED. YOU DON'T
HAVE A RIGHT TO THAT TICKET
BECAUSE YOU COULD VERY WELL HAVE
PURCHASED IT AND RESELL IT
BEFORE IT'S DELIVERED TO YOU. SO
PUTTING THAT ASIDE, WE WOULD
AGREE. I THINK THE REGULATION OF
SPECULATIVE TICKETS IS
INCREDIBLY IMPORTANT, UM,
CALIFORNIA HAS HAD THAT IN
STATUTE FOR QUITE A WHILE. I
THINK IT'S FAIR TO SAY THAT ONE
OF THE DIFFICULTIES OF UM
REGULATING SPECULATIVE TICKET
SALES IS IDENTIFYING WHAT IS A
SPEC CHICKEN AND WHAT IS NOT,
AND SO WHAT WE'VE SEEN IS KIND
OF A MOVEMENT TO RETHINK THE WAY
THAT THOSE REGULATIONS WORK. I
WOULD POINT TO A BILL THAT
PASSED THROUGH THE, UM UNITED
STATES, UH, ENERGY, HOUSE ENERGY
AND COMMERCE COMMITTEE
UNANIMOUSLY THAT BASICALLY
PROHIBITS THE RESELL OF A
SPECULATIVE TICKET. FULL STOP,
AND I THINK THAT'S A STEP IN THE
RIGHT DIRECTION. BUT THEN WHAT
IT DOES IS IT COUPLES IT WITH
THE ENABLEMENT OF SOME SORT OF
PROCUREMENT SERVICE LIKE YOU
JUST DESCRIBED BUT WITH VERY
DETAILED EXPLANATIONS OF HOW
THAT SERVICE IS MERCHANDISED, SO
IT CANNOT BE IN LINE WITH
ANOTHER TICKET SALE. IT HAS TO
BE VERY DISTINCT FROM WHAT A
TICKET LISTING ACTUALLY LOOKS
LIKE, AND FROM OUR PERSPECTIVE,
WE THINK THAT'S A GREAT
REGULATORY PATH FORWARD BECAUSE
IT ALLOWS FOR INNOVATION AND
ALLOWS FOR BETTER WAYS TO DO
THINGS ALL WHILE PROTECTING THE
CONSUMER FROM BUYING SOMETHING
THAT DOESN THIS, SO WE THINK
IT'S A REALLY POSITIVE MIDDLE
GROUND. IS THE PRODUCT GUY IN
THE ROOM. I'D BE CURIOUS YOUR
INTAKE YOUR INPUT ON, UM IT'S
REALLY HARD TO IDENTIFY THE
SPECULATIVE TICKETS IS THAT I
MEAN, IN SOME CASES VERY EASY IF
THEY ARE ON SALE YET YOU SHOULD
KNOW THEY'RE SPECULATIVE. BUT
OTHER THAN THAT, I MEAN, WE ARE.
WE'RE PURE PLAY PRI. NOW I KNOW
YOUR PRIMARY, BUT I JUST DIDN'T
KNOW IF YOU HAD THOUGHTS ON THE
SPECULATIVE MARKET. I HAVEN'T
SEEN IT AS HONESTLY. LIKE LIKE,
I DON'T KNOW HOW BIG OF A
PROBLEM IT IS. I THINK IT'S KIND
OF RIDICULOUS. IT'S KIND OF LIKE
THE EDGE RIDICULOUSNESS OF SO
MUCH SECONDARY ACTIVITY
HAPPENING WILL BE BUYING LIKE
SHORT POSITIONS ALMOST ON
SECONDARY. UM, EXACTLY WHAT IT
IS. I'M MORE FOCUSED ON TRYING
TO, YOU KNOW, KEEP AS MUCH
REVENUE IN THE HANDS OF FANS AND
THE PROMOTERS IF I WOULD JUST
MAY I JUST A QUICK COMMENT ON
THAT. SO UM, I, I DON'T THINK
THIS IS NUANCED. I DON'T THINK
IT HAS TO BE INVOLVED WITH WITH
ANY, UH, COMPLEX DISTINCTION
BETWEEN BETWEEN TICKETS AND
SERVICES. UH, IF I AGREE THAT
THAT IF YOU EITHER HAVE THE
TICKET IN HAND, OR YOU HAVE THE
CONTRACTUAL RIGHT TO THE TICKET,
UM THEN THEN THAT TAKES IT OUT
OF THE REALM OF SPECULATIVE, BUT
BUT THAT'S NOT WHAT WE'RE
DEALING WITH HERE WE'RE DEALING
WITH WITH WITH LOOK, FOR EXAMPLE
, THE DAVE MATTHEWS TICKETS THAT
ARE ON SUB YESTERDAY. THE SHOW
ISN'T ON SALE. IT'S IMPOSSIBLE
FOR THAT NOT TO BE SPECULATIVE.
IT'S IMPOSSIBLE. AND YET YOU CAN
SEE THIS AMPHITHEATER THIS
SECTION THIS ROW AND YOU HAVE TO
READ FINE PRINT. TO FIGURE OUT
THAT YOU'RE YOU'RE JUST GETTING
YOU'RE BUYING THE SERVICE OF
SOMEBODY PROCURING. THERE'S NÓ
SOCIAL VALUE IN THAT KIND OF
HAIR SPLITTING THIS THIS, YOU
KNOW, IT'S TRYING TO MAKE A HAIR
SPLITTING ON DIFFERENT KINDS OF
FRAUD. FRAUD IS FRAUD. IT SHOULD
JUST BE. IT SHOULD BE A BLANKET
PROHIBITION ON SPECULATIVE
TICKETING AND THE WORLD WILL GET
ALONG JUST FINE UNDER THOSE
CONDITIONS JUST NEED TO GO BACK
TO THE DAYS WHERE THE POOR
COLLEGE STUDENT CAN JUST WAIT IN
LINE. UM THEN, UH, I HAD A
QUESTION ABOUT SO THE ANALYSIS
NOTES THE POINT ABOUT, UM,
CONTROLLING THE PRICES AND I
THINK WE'VE TALKED ABOUT, UM THE
YOU KNOW. LAURA HAS DONE A GOOD
JOB OF TALKING ABOUT, UM, THE
LIMITS ON THE RESALE RIGHT IF
THERE'S A CONTRACTUAL LIMIT TO
HOW YOU CAN RESELL THAT TICKET,
BUT THE ANALYSIS ALSO NOTICED
NOTED THAT SECONDARY, UM SELLERS
AND I, IT DIDN'T REFER TO THEM
SO THIS MAY NOT BE STUBHUB, BUT
I JUST WANTED YOU TO COMMENT ON
IT MAY RESTRICT THE SALE OF
TICKETS AT FACE VALUE AND ONLY
ALLOW FOR THE HIGHER PRICE
TICKETS TO GET THOSE HIGHER FEES
THAT WE SAW. UM THAT SEEMED
PROBLEMATIC TOO. AND WE HAVEN'T
TALKED ABOUT THAT. SO I JUST
WANTED TO TOUCH ON THAT. SUBURB
DOESN'T RESTRICT PRICES UP OR
DOWN. UM SO IT'S NOT A SERVICE
THAT WE OFFER TODAY IN IN THE U
S¼. I'M NOT SURE IF YOU DO IT,
I. I MEAN, THERE MIGHT BE PLACES
WHERE THERE'S A CONTRACT LIKE A
LEGAL OBLIGATION TO DO THAT
SOMEWHERE ELSE. WE DON'T DO IT
IN THE U S¼. UM I THINK WHAT'S
INTERESTING ABOUT FACE VALUE
EXCHANGES. I THINK IT'S A GREAT
OPTION FOR CONSUMERS RIGHT AND
THEY SHOULD ALWAYS HAVE THE
OPTION TO PARTICIPATE IN THAT
FACE VALUE EXCHANGE. BUT ONE OF
THE THINGS THAT CONCERNS ME FROM
A CONSUMER PERSPECTIVE IS
WHETHER OR NOT THAT FACE VALUE
ALLOWS FOR THOSE PRICES TO
FLUCTUATE DOWN, AND IN MANY
INSTANCES THEY DON'T CAUSE I
THINK ONE OF THE THINGS WE HAVEN
REALLY DISCUSSED IS HOW RESALE
RESTRICTIONS CAN BE USED TO
CONTROL THE MARKET GOING DOWN AS
WELL. RIGHT IF A IF AN EVENT
CAN'T HOLD THE MARKET IF IT
CAN'T HOLD THE PRICE OF THE
TICKET INITIALLY SOLD A PRICE
FLOOR OR A FACE VALUE ONLY
EXCHANGE PROHIBITS THOSE PRICES
FROM DROPPING, WHEREAS ON A
STUBHUB OR ANOTHER WEBSITE THAT
DOESN'T HAVE THOSE CONTROLS,
PRICES CAN GO VERY LOW. I'LL
GIVE YOU AN EXAMPLE UM, OF BRUCE
SPRINGSTEEN A HOT TICKET ON THE
EAST COAST. THOSE TICKETS DIDN'T
MAINTAIN THAT PRICE POINT IN THE
MIDDLE OF THE COUNTRY. WE HAD
SELLING ON STUBHUB FOR 6 TO $30
FOR AN EVENT THE SAME TICKETS
BEING RESOLD ON TICKETMASTER
RESALE. WE'RE NOT LISTED BELOW
$60, SO CLEARLY, THERE IS SOME
SORT OF MECHANISM TO PREVENT
THAT PRICE FROM GOING DOWN, AND
I THINK WHEN WE THINK ABOUT LIKE
A FREE MARKET, WE NEED TO THINK
ABOUT IT BOTH WAYS BECAUSE
RESTRICTIONS CAN BE USED TO CAP
PRICES GOING UP, CERTAINLY, BUT
THEY CAN ALSO BE USED IN THE
OTHER DIRECTION, AND IT WOULD BE
A REAL DISADVANTAGE. WE THINK TO
CONSUMERS TO PREVENT THOSE LOW
PRICES FROM HAPPENING BECAUSE IN
A LOT OF WAYS IN A VERY
CORPORATIZED INDUSTRY, YOU KNOW?
TICKETS AREN'T CHEAP. WE ALL
KNOW THAT AND HAVING THE ABILITY
TO GO TO AN EVENT BELOW FACE
VALUE IS IMPORTANT. YEAH IT'S
IMPORTANT TO NOTE. I MEAN,
DYNAMIC PRICING CAN LEAD TO VERY
HIGH PRICES. BUT AS THE A'S WELL
KNOW IT CAN ALSO LEAD TO VERY
LOW PRICES. THAT WAS PRETTY
THROW THEM UNDER THE BUS AS THEY
LEAVE THE STAGE. UM I WANNA
THANK YOU ALL FOR YOUR BEING
HERE. UM, I KNOW THIS WAS A HARD
DIALOGUE TO HAVE, BUT I REALLY
ACTUALLY APPRECIATE IT. UM,
BECAUSE I DO THINK THE
INNOVATION WE'RE SEEING IN
CALIFORNIA AND THE ABILITY TO
HAVE THESE HARD CONVERSATIONS TO
GET TO THE BOTTOM OF IT WILL
HOPEFULLY LEAD TO LEGISLATION
THAT WILL PROTECT CONSUMERS AND
ALLOW FANS TO NOT HAVE TO START
COMPANIES TO GET TICKETS. YOU
KNOW, WE APPRECIATE THAT YOU
DID. THANK YOU. UM, SO THE LAST
PIANO WE HAVE IS WORKING WITH
THE TICKETING ECOSYSTEM. WE HAVE
CONSUMER EXPERT JUSTIN BROOKMAN,
THE DIRECTOR OF TECHNOLOGY
POLICY AT CONSUMER REPORTS. WE
HAVE A VENUE OPERATOR, AS I
MENTIONED JOE RINALDI, THE
MANAGING PARTNER AT THE MUSIC
BOX IN SAN DIEGO, AND WE LOST IT
OR SAN DIEGO MEMBER LEFT. UM AND
WE HAVE THE ARTIST,
REPRESENTATIVE DAVE SHAPIRO,
PARTNER AT THE SOUND TALENT
GROUP TO SPEAK FROM THE ARTIST
PERSPECTIVE AND WE WILL START
WITH MR BROOKMAN. HEY, GOOD
AFTERNOON. THANK YOU VERY MUCH
FOR HAVING ME HERE. MEMBERS OF
THE COMMITTEE, UH, CHAIR BE, UH,
BARRY KHAN. I GOT TO TESTIFY
WITH YOU LAST YEAR ON A B 254,
WHICH I WAS A VERY PRIVILEGED TO
THE CHANCE TO DO. I'M GLAD THAT
LAW NOW, UH, MY NAME IS JUSTIN
BRUCKMAN. I AM DIRECTOR OF
TECHNOLOGY POLICY AT CONSUMER
REPORTS. WE ARE INDEPENDENT,
NONPROFIT MEMBERSHIP
ORGANIZATION WORKING FOR A
FAIRER, SAFER AND HEALTHIER
WORLD. SO WE DO THIS IN A BUNCH
OF DIFFERENT WAYS. WE TEST AND
RATE PRODUCTS LIKE CARS AND
REFRIGERATORS. WE DO IN DEPTH,
UM, JOURNALISM AND EXPOSES IN
THE COMPANIES. UM WE CREATE
PRODUCTS TO HELP PEOPLE MANAGE
THEIR ONLINE LIVES. UM WE
CONDUCT NATIONALLY
REPRESENTATIVE SURVEYS, UM, TO
FIND OUT HOW PEOPLE FEEL ABOUT
THESE SORT OF ISSUES. UM AND
THEN MY GROUP WE ADVOCATE FOR
STRONGER LAWS AROUND THE
COUNTRY. UH, TO PROTECT
CONSUMERS. ONE ISSUE WE'VE
WORKED ON FOR A WHILE, IS THE
ISSUE THE ONLINE TICKETING
MARKETPLACE, I THINK, UM, CLEAR.
A LOT OF CONSUMERS ARE
FRUSTRATED WITH HOW IT GOES. UM,
A FEW YEARS AGO, THE FEDERAL
TRADE COMMISSION HAD A WORKSHOP
ON THIS ISSUE. WE REACHED OUT TO
OUR MEMBERS AND SAY, HEY, TELL
US YOUR STORIES ABOUT HOW IT WAS
WORKING FOR YOU. ABOUT 6600
PEOPLE RIGHT BACK TO US, AND
THAT THAT'LL TRADE THE MISSION,
UM, COMPLAINING ABOUT HIDDEN
FEES. THEY REALLY WEREN'T SURE
WHO THEY BOUGHT FROM, UM, UH,
BEATEN. SWITCH TACTICS.
FRUSTRATION ABOUT DARK PATTERNS.
UM GENERAL, THE OPACITY OF THE
MARKETPLACE THEY FOUND TO BE
REALLY FRUSTRATING. UM ONE
PERSON WROTE TO US, SHE SAID. I
ACTUALLY BUY TICKETS TO EVENTS,
PLAYS AND SHOWS QUITE OFTEN. I
SEARCH FOR THE BEST NIGHT. BEST
SEATS, BEST PRICES. AFTER ALL
THAT SEARCHING AND COMPARING, I
PROCEED TO ACTUALLY PLACING THE
ORDER, AND THAT'S WHEN THE ADDED
FEES SHOW UP AFTER ALL. EFFORT
AND THE TIME LIMIT TO COMPLETE
THE ORDER BEFORE THE SEATS ARE
LOST. I JUST GO AHEAD AND PAY
WHAT I HAVE TO. I FEEL THIS IS
UNFAIR. I DON'T FIND OUT THE
TRUE COST UNTIL THIS CLOCK IS
TICKING. UM OTHER PEOPLE HAVE
SAID THEY REALLY WEREN'T SURE
WHO THEY BOUGHT FROM, ONE WOMAN
WROTE IN, SHE SAID. SHE BOUGHT,
UM SHE SPENT THREE TIMES OF HER
FACE VALUE FOR A LOCAL
PRODUCTION OF THE NUTCRACKER SHE
BOUGHT FROM SECURE BOX
OFFICE.COM. SHE THOUGHT SOUNDED
REALLY OFFICIAL. I THOUGHT IT
WAS THE BOX OFFICE. UM AND THEN
SHE BOUGHT THEM. THEY DIDN'T
EVEN HAVE THE TICKETS. THEY JUST
SAID, OH, WE ARE COMMITTING TO
PROCURE THESE TICKETS FOR YOU
NOW, UM, AND THEN SHE FOUND OUT
THEY WERE ACTUALLY AVAILABLE ON
THE VENUE SITE FOR LIST PRICE.
AND SHE WAS SHE FOUND THAT TO BE
FRUSTRATING. CONFUSING UM, UH,
THIS THESE FINDINGS, I THINK
LARGELY REFLECT. UM UH BROADER
REPORT THAT THE G A Ó DID THAT
WAS REFERENCED AGAIN IN VERY
EXCELLENT BRIEFING MEMO DONE BY
THE COMMITTEE STAFF, UM, SHOWING
THE MARKETPLACES ARE DOMINATED
BY RESELLERS, HIDDEN FEES AND
SHADY WHITE LABEL RESALE SITES.
UM AND I THINK SINCE THAT TIME,
I THINK THINGS HAVE NOT GOTTEN
BETTER. UM A COUPLE WEEKS AGO, I
WAS ON REDDIT AND ON THE FRONT
PAGE. THERE WAS A STORY OF WHAT
HAS BECOME SO EXPENSIVE. IT'S
NOT WORTH BUYING ANYMORE. UH,
THE NUMBER ONE THING WAS FAST
FOOD THAT PEOPLE WERE VERY
FRUSTRATED ABOUT BURGER PRICES,
BUT THE NUMBER THREE ANSWER, UM
WAS OVER. 13,000 UP VOTES WITH
CONCERT TICKETS. UM, AND THE
THREAD CONTAINED A LOT OF
UNSURPRISING AMOUNT OF INVECTIVE
DIRECTED AT TICKETMASTER OR LIVE
NATION RESELLERS. JUNK FEES. THE
FEDERAL TRADE COMMISSION GOT A
LOT OF GRIEF FOR WHY IS THIS
ALLOWED? UM AND IN SOME CASES,
ARTISTS THEMSELVES THE NUMBER 12
UPLOADED THING WAS ALSO CONCERT
FEES, BY THE WAY, SO A LOT OF
ANGER ABOUT ABOUT THIS, UM I'LL
SAY MY OWN EXPERIENCES HAVE
REFLECTED THAT I TOOK MY SON TO
A CAPITALS GAME A COUPLE OF
MONTHS AGO, UM, CHECKED OUT AND
THEN SUDDENLY, UH, UPON CHECKING
OUT THE PRICE WAS 40% HIGHER.
FROM THE TEAS. THE FEES, UH, A
APPLICABLE SERVICE DELIVERY AND
TRANSACTIONAL FEES. UM I TOOK MY
DAUGHTER AND ONE OF HER FRIENDS
TO A MELANIE MARTINEZ CONCERT.
UM THEY SOLD OUT WITHIN WITHIN
SECONDS. AND SO WE HAD TO PAY IT
ON THE ON THE SECONDARY MARKET.
WE SHOWED UP ME AND MY DAUGHTER
GOT IN, UM, HER FRIEND SHOWED
UP, AND IT WAS A FRAUDULENT
TICKET. SO THE EXAMPLE THAT THAT
CHAIR GIBSON TALKS ABOUT SHE
COULDN'T GET IN. WE HAD TO GO. I
GAVE HER MY CREDIT CARD, AND
EVENTUALLY SHE GOT IN AFTER HALF
AN HOUR. BUT THERE'S STILL NOT A
GREAT FIRST CONCERT GOING
EXPERIENCE FOR HER, UM AND LAST
WEEK I WAS ACTUALLY TRYING TO
BUY TICKETS FOR MYSELF. UM, IT
WAS AN ARTIST WHO WAS TRYING TO
CREATE ALL THESE HOOPS TO JUMP
THROUGH TO ONLY THE REAL FANS TO
GET IT AND I. I THINK I
AUTHENTICATED MYSELF. I. I WENT
TO THE FANS ONLY SITE. UM UH UH
AND THEN I GOT ONLINE AND THEN
THEY THOUGHT I WAS A BOT. EVEN
NOT SURE. WHY UH BUT I WAS NOT
ABLE TO BUY A TICKET, SO I THINK
THERE IS AGREEMENT THERE'S NEED
FOR SOME SORT OF POLICY
INTERVENTION HERE. UM, I DO
THINK THE LOWEST HANGING FRUIT
IS ALL IN PRICING RECEIVED A TON
OF ATTENTION. THE FEDERAL TRADE
COMMISSION IS DOING A RULE
MAKING AROUND IT. IT SEEMS LIKE
A NÓ. THAT SHOULD HAVE BEEN
ADDRESSED YEARS AGO. UM WE
SUPPORTED S¼ B 478, WHICH I
THINK WILL HELP REIN IN FEES. I
THINK IT'S A GREAT AND FANTASTIC
BILL. UM I DO WANT TO ECHO
SOMETHING THAT THAT MR WALL SAID
THAT, UM WE HAVE SEEN OTHER
EFFORTS TO DO THIS HAVE NOT BEEN
AS EFFECTIVE. NEW YORK HAS ALL
IN PRICING. UM AGAIN, THE MEMO
THE BRIEFING MEMO, I THINK CITES
A ROLLING STONE STORY. UM THAT
SHOWED THAT THEY THEY WENT TO
ALL THESE SITES, AND IN FACT,
THERE'S REALLY NOT ALL IN
PRICING FOR A LOT OF PLACES YOU
NEED TO CLICK LIKE 10 TIMES. YOU
NEED TO LOG IN FIRST AND THEN AT
THE AND RIGHT BEFORE, NOT THE
NOT THE NOT AT THE LAST STEP,
THE SECOND TO LAST STEP, THEY'LL
TELL YOU THE RIGHT THE RIGHT
PRICE IS, UM AND I THINK SOME
COMPANIES ARE DOING IT RIGHT.
THEY DO SHOW ALL IN PRICING
RIGHT AWAY. BUT IT IS THEY THEY
THEY SUFFER FROM IT. BECAUSE IF
SOMEONE LOOKS AND SAY, WELL,
SHOOT, THIS PRICE IS CHARGING
THIS SITES CHARGING ME MORE. UM,
SO IT REALLY IS A COLLECTIVE
ACTION PROBLEM THAT THERE NEEDS
TO BE, UM, CLEAR RULES FOR
AGAIN. 478 IS GREAT, BUT I THINK
IMPLEMENTATION IS GONNA BE
REALLY IMPORTANT. SO IT'S GONNA
NEED TO BE, UM, ENFORCED. UM I
THINK ADDITIONAL PRICE
TRANSPARENCY COULD BE USEFUL.
WE'VE SEEN OTHER LEGISLATIONS
MANDATE, YOU KNOW, TELL PEOPLE
THE ORIGINAL LIST LIST PRICE OF
THE TICKET SO THEY CAN SAY IS IT
A $15? OR A $40 TICKET. UM SO
SOME INDICATION OF VALUE
BREAKING OUT ALL THE FEES AGAIN
JUST SO PEOPLE CAN KNOW WHAT'S
GOING ON. IN ADDITION TO THE ALL
IN PRICE, WHETHER THE SELLER IS
THE ORIGINAL SELLER, OR OR
RESELLER, I THINK THIS DEGREE OF
TRANSPARENCY CAN INJECT SOME
MORE INFORMATION INTO THE
MARKETPLACE. UM WE'VE HEARD SOME
STUFF AROUND SPECULATIVE
TICKETING. I THINK A LOT OF, UM
EXECUTIVE EXACT EXISTING
SPECULATIVE TICKETING PRACTICES
ARE PROBABLY ILLEGAL ALREADY. UM
BUT BECAUSE OF UNDER
ENFORCEMENT, THESE PRACTICES
REMAIN RELEVANT. UNFORTUNATELY
YOU KNOW, GOING THROUGH GOOGLE
SEARCH YOU'RE NOT ALWAYS GONNA
FIND THE RIGHT ANSWER. DR. BEGA
TALKED ABOUT HOW GOOGLE SEARCH
HAS GOTTEN WORSE IN A LOT OF
WAYS. I THINK A LOT OF US FEEL
THE SAME WAY. YOU DON'T KNOW WHO
YOU'RE GOING WITH. UM, SEARCH
ENGINE OPTIMIZATION HAS GOTTEN
BETTER SO PEOPLE OFTEN END UP AT
THE WRONG SITE. UM I THINK
LEGISLATION CLARIFYING, UH, THAT
YOU CAN'T MARKET TICKETS YOU
DON'T HAVE IS PROBABLY A GOOD
IDEA. UM I DO UNDERSTAND. THERE
ARE SOME GRAY AREA AROUND THESE
CONCIERGE SERVICES. UM YOU KNOW,
YOU HIRE SOMEONE TO GO WAIT IN
LINE FOR YOU, FOR EXAMPLE. I'M
NOT SURE THESE ARE REALLY
CONSUMER SERVICES THEY DO IN IN
INJECT MIDDLE MEN INTO THE PRA
INTO THE INTO THE PROCESS. IT
DOES JACK UP PRICES BECAUSE
PEOPLE WHO ARE WILLING TO PAY
FOR THE LABOR OF FINDING TICKETS
AT THE VERY LEAST, TO DO THINK
THESE NEED TO BE MORE CLEARLY
DISCLOSED. I ALSO WANT TO BRING
UP THE ISSUE OF REGULATOR
RESOURCES. UM SO A LOT OF THIS
STUFF WE'RE TALKING ABOUT IS
PROBABLY ALREADY ILLEGAL UNDER
CALIFORNIA'S VERY STRONG
CONSUMER PROTECTION LAWS. UM AND
THAT WAS A COMMON THEME. THE
THINGS WE HEARD LIKE, HOW IS
THIS NOT ILLEGAL? UM SOMETIMES
IT IS, LIKE DECEPTIVE PRICING.
UM, UH, S¼ SCARING SELLERS.
SELLING TICKETS YOU DON'T HAVE.
I THINK IT'S PROBABLY ALREADY
PROHIBITED BUT WITHOUT ROBUST
ENFORCEMENT WITHOUT DE
REGULATORS TO REALLY DEDICATED
TO IT, UM AGAIN. WE'VE SEEN LOTS
OF EFFORTS AROUND THE COUNTRY TO
ADDRESS THIS, BUT A LOT OF TIMES
THEY'VE FALLEN BY THE WAYSIDE.
UM SO I THINK, AS YOU'RE
THINKING ABOUT REGULATORY
INTERVENTIONS THAT MAKES SENSE
AND MAKING SURE REGULATORS ARE
ARE ENFORCED TO DO THAT, UM
THERE IS A PRIVATE RIGHT OF
ACTION UNDER S¼ B 478, WHICH I
THINK WILL HELP. UM AND SO WHEN,
AND WE'RE VERY SUPPORTIVE OF
THAT ELEMENT UM ONE AREA WE'VE
HEARD VERY DIFFERENT OPINIONS ON
THIS. TODAY IS THE ISSUE OF UH
UH UH UH, POLICY INTERVENTIONS
AROUND RESTRICTIONS ON RESALE,
UM, PUTTING LIMITATIONS ON TRANS
OR THE ABILITY TO CHARGE HIGHER
PRICES AND RESALE. UM LIKE SOME
STATES TO STRICTLY PROHIBIT IT
RESELLER CAN DO WHATEVER THEY
WANT. UM, THERE'S A HEARING
TOMORROW IN MARYLAND. THEY'RE
THEY'RE HEARING A LOT TO SAY
THAT YOU CAN ONLY RESELL AT FACE
VALUE. YOU CAN'T RESELL ANYTHING
MORE THAN THAT, UM, I THINK IN
SOME LIMITED CASES, RIGHT RETAIL
RESTRICTIONS CAN HURT LEGITIMATE
CONSUMERS IF YOU CAN'T AND AN
EVENT FOR A REASON. DR. BARGA
CAN TESTIFIED ABOUT THIS. IF YOU
BUY SEASON TICKETS. YOU CAN'T
MAKE IT EVERY SINGLE GAME
RESELLING IT IT IT CAN BE VERY
HELPFUL, BUT I THINK IT'S
IMPORTANT TO KEEP IN MIND. THE
VAST MAJORITY OF PEOPLE WHO ARE
RESELLING ARE BROKERS, UM, WHO
ARE TRYING TO TAKE ADVANTAGE OF
THE LOWER THAN THE MARKET VALUE
PRICES AND THEN AND THEN JACKING
THEM UP IF THERE ARE MORE
RESTRICTIONS ON RESALE. UM I
THINK THERE WOULD BE A STRONG
DETERRENT AGAINST SCALPERS. AND
I THINK YOU KNOW SOME OF THE
LOWER PRICES MIGHT ACTUALLY SEE
DOWN TO CONSUMERS AT THE END OF
THE DAY, SO I THINK IT'S A GOOD
GOOD IDEA TO ENCOURAGE, UM IS TO
EXPERIMENT WITH THESE SORT OF
RESTRICTIONS. UM AND SO, FOR
THAT REASON, I THINK I WOULD
DISAGREE WITH MS DOOLEY, WHO IS
SAYING THAT THOSE SIX STATES
THAT HAVE THOSE BLANKET
PROHIBITIONS LIKE RESELLERS CAN
DO WHATEVER THEY WANT. UM I
THINK THAT'S NOT NOT ACTUALLY
GOOD AT THE END OF THE DAY FOR
CONSUMERS, UM, BECAUSE AGAIN, IT
DOES INCENTIVIZE RESELLERS AND
THE PRICE IS GETTING UP IN THE
FIRST PLACE. UM I WOULD AGREE,
PROBABLY WITH WITH MISS DOLEY
THAT THAT, UM, RESALE
RESTRICTIONS IMPOSED BY THE
PRIMARY SELLER THOSE MIGHT BE
BAD BY THE BY THE TICKETMASTER
JUST TO PROHIBIT, UM, RESALE
THROUGH PARTNER. I DID, UH,
DOCTOR BE BARGA AGAIN. TALKED
ABOUT THE BENEFITS OF
INTEROPERABILITY. UM WHICH MIGHT
HELP, UH, PROVIDE SOME MORE, YOU
KNOW, CLARITY AND LIQUIDITY IN
THE MARKETPLACE. AND SO I THINK
IN THOSE CASES, UM UH, THE
TICKET MASTER IMPOSED
RESTRICTIONS WERE NOT
NECESSARILY BE A GOOD IDEA. UM
BUT, YEAH, I'M HAPPY TO TALK
ABOUT THESE OR ANSWER MORE
QUESTIONS, AS AS THE DAY GOES
ON. THANK YOU SO MUCH. MY UH,
REGULATORY LAWYER HART IS FULL.
HERE. WE ALL TALK ABOUT
ENFORCEMENT. UM AND I TOOK AWAY.
WE NEED TO HAVE A HEARING ON THE
WHERE THE DOLLAR MENU WENT TO
MCDONALD'S THAT APPARENTLY SHOW
UM, NEXT, WE WILL GO TO MR
RINALDI TO TALK ABOUT WHAT IT
MEANS TO BE A VENUE OPERATOR.
THANK YOU. CHAIRS AND MEMBERS,
UH, FOR HAVING ME IN TODAY. UH,
MY NAME IS JOE RINALDI. I'M THE
MANAGING PARTNER OF MUSIC BOX IN
SAN DIEGO. IT'S A 705 CAPACITY
VENUE. UM IN THE HEART OF LITTLE
ITALY. VERY UM, NEW. NICE VENUE.
UH WE'D HAVE A LOT OF, UM, WE
SELL ABOUT 84,000 TICKETS A YEAR
. UH WE ARE AN INDEPENDENT VENUE
WHERE A MEMBER OF NEVA, THE
NATIONAL INDEPENDENT VENUE
ASSOCIATION, BUT I'M HERE TODAY
TO SPEAK ON BEHALF OF MY CLUB.
UM WE HAVE TAKEN THE FIRST NINE
YEARS OF OUR EXISTENCE AND TRIED
TO BUILD A REPUTATION THAT, UM
WE'RE A PLACE THAT A PERSON CAN
COME AND HAVE A GOOD TIME AND
SEEING ARTISTS THEY'VE ALWAYS
WANTED TO SEE AND HAVE THAT
TIMELESS EXPERIENCE OF A CONCERT
. UM WHAT I DO AT NIGHT IS I
TEND TO HAVE TO DEAL WITH ABOUT
4 TO 6 CUSTOMERS A NIGHT THAT
ARE THE RESULT OF ALL OF THE
DIFFERENT DECEPTIVE PRACTICES
YOU'VE HEARD ABOUT TODAY. UM I'M
VERY HAPPY THAT MY COLLEAGUE
FROM CONSUMER REPORTS TOOK A
SECOND TO LOOK AT IT FROM A
CONSUMER. UH, POSITION BECAUSE
THAT IS WHAT MY FOCUS IS ON AS
WELL. I FEEL LIKE ON A NIGHTLY
BASIS. I AM LETTING DOWN ABOUT 4
TO 6 PAIRS OF CUSTOMERS. IT'S
NORMALLY ON DATE NIGHT. THEY'VE
NORMALLY TRAVELED A GREAT
DISTANCE TO BE AT OUR VENUE. WE
NORMALLY ARE NOT SOLD OUT. WE
SPENT SO MUCH TIME TODAY TALKING
ABOUT SOLD OUT SHOWS IN THE
MECHANICS OF THE RESALE MARKET.
I SELL ABOUT FIVE SHOWS OF MY 25
SHOWS OUT A MONTH. THE REST OF
THEM. I HAD TICKETS AVAILABLE AT
FACE PRICE AS MY COLLEAGUE HAD
MENTIONED, UM, THAT MEANS THAT
THERE'S A COTTAGE INDUSTRY A
COTTAGE INDUSTRY THAT IS
DIVERTING, UH, MY BUSINESS, MY
LIKENESS, THE LICENSE AND
LIKENESS OF THAT ARTIST AND THEY
ARE TAKING IT IN, UM, ASCRIBING
TO IT, THEIR BUSINESS PLAN, AND
THEIR BUSINESS PLAN IS TO TAKE
MY 25 TO $40 TICKET AND CONVINCE
YOU THROUGH, UH, SEARCH ENGINE
OPTIMIZATION OR ANY OTHER
NEFARIOUS TRICK. AND THAT THEY
HAVE A TICKET FOR YOU AT MY
VENUE. THAT COST ABOUT $350.
ALTHOUGH MY SHOW IS NOT SOLD OUT
, THEY WILL ALSO ADORN THAT
TICKET WITH THINGS THAT DON'T
EXIST IN MY VENUE. THEY WILL
TELL YOU THAT YOU'RE SITTING IN
THE FRONT ROW. I AM A STANDING
VENUE. THEY WILL TELL YOU. YOU
HAVE A MEET AND GREET WHERE
THERE IS NÓ MEET AND GREET WITH
THAT ARTIST OFFERED. IF YOU
BOUGHT THOSE TICKETS, AND YOU'RE
ON DAY NIGHT, AND YOU'RE 700 TO
$800 IN ON MY LESS THAN $100
TICKETED SHOW AND YOU ARE, AS
WE'VE ALL SEEN THE RESEARCH ON
PARTICIPATING IN THE ECONOMIC
ACTIVITY OF ATTENDING A CONCERT,
WHICH WE ALL KNOW THE SCIENCE
BEHIND THIS THAT EVERY DOLLAR
SPENT WITH ME GENERATES $12 IN
THE ECONOMY. YOU ARE LOSING
FAITH AND CONFIDENCE IN THIS
INDUSTRY. UH, AGAIN TO MY
COLLEAGUE'S POINT. WE ARE
DESPERATE. FOR, UH, ENFORCEMENT
OF EXISTING LAWS, BUT ALSO
CLEAR. UNDERSTANDING A REFEREE
IF YOU WILL. THAT UH, WHEN YOU
BUY A TICKET TO OUR VENUE, IT IS
SOMETHING THAT WE ARE A PRIMARY
SELLER OF THIS IS NOT ABOUT THE
SECONDARY MARKET. THESE ARE
SIMPLY PEOPLE DIVERTING.
SECONDARY MARKET IS FOR TAYLOR
SWIFT TAYLOR. SWIFT HAS NEVER
PLAYED MUSIC BOX SAN DIEGO I
YET. WELL WE DID HAVE BILLIE
EILISH WE, YOU KNOW, WE HAVE
THOSE, UH, EQUATIONS HERE AND
THERE THEY ARE TROUBLESOME, TOO.
THIS IS AN 8020 SITUATION. 20%
WE SPENT ALMOST ALL OF THESE
THREE HOURS TALKING ABOUT 80%
THAT'S MY DAILY EXISTENCE. WE
NEED TO FIGURE OUT HOW THESE
PEOPLE GOT HERE. I DON'T
NECESSARILY THINK THOSE PEOPLE
ARE STUBHUB. UH, IT'S NOT THAT
HARD FOR YOU TO REPRINT A
BARCODE AND GET A BARCODE ON A
PIECE OF PAPER TO A CUSTOMER. IF
YOU HAVE NÓ OTHER OVERHEAD, YOU
DID NOT CONTRIBUTE TO THE TALENT
BOX OFFICE SECURITY RENTAL
PRODUCTION OF THAT SHOW YOU ONLY
HAD TO TAKE BARCODE AND PUT IT
FROM ONE SPOT TO ANOTHER. FOR
THE HIGH PREMIUM OF WHATEVER
GOOD WILL YOU GOT IN THAT
TRANSACTION, SO IF YOU CHANGE
THE PRICE TO SOME OTHER
SECONDARY PRICE, YOU'RE ONLY
EXPENSE WAS EFFECTIVE
PHOTOSHOPPING. AND SO WHEN THAT
DOESN'T HAPPEN, AND THEY COME UP
TO MY WINDOW TO MY ROPE LINE,
AND I AM THE GENERAL MANAGER OF
THAT VENUE, AND I HAVE TO GREET
THEM, AND THEY SHOW ME A PIECE
OF PAPER THAT HAS NOTHING TO DO
WITH ME. AND YOU KNOW THEY SPENT
THAT MONEY. WHAT DO YOU TELL
THEM RIGHT THEN? NOT. THEY'RE
GONNA GO ON MY FEEDBACK. THEY'RE
BASICALLY GOING TO ATTRIBUTE
THEIR EXPERIENCE TO ME. THEY'RE
GONNA LEAVE THAT SECONDARY
CELLAR OR THAT OTHER FRAUDSTER
IS WHAT WE'RE TALKING ABOUT HERE
. THAT PERSON THEY'RE GONNA
LEAVE ALL OF THOSE PEOPLE OUT OF
THE STORY BECAUSE THOSE PEOPLE
DON'T ACTUALLY HAVE A PLACE FOR
YOU TO LEAVE FEEDBACK. AND
THEY'RE GONNA PUT ALL OF THAT
THEY'RE GONNA HEAP IT ON MY
VENUE. NINE YEARS OF INVESTMENT.
IT'S A SMALL BUSINESS. I HAVE 60
EMPLOYEES. NONE OF THIS. NONE OF
THE SITUATION THAT WE'RE TALKING
ABOUT TODAY HAS ANYTHING TO DO
WITH THE 60 EMPLOYEES EXCEPT FOR
NEGATIVE FALLOUT. IT'S
IMPERATIVE THAT WE TRY TO TAKE A
LOOK AT THIS, UM IN A WAY AND
SEE WHERE WE CAN ACTUALLY
ENFORCE LAWS AND MAKE CHANGES.
I, I THINK OF OTHER INDUSTRIES.
UM WE DID A PRETTY FINE JOB OF
GETTING AMAZON TO PAY CALIFORNIA
SALES TAX. THERE WAS A DOLLAR
MOTIVATION IN IT. I GET IT, BUT
THIS IS A VERY SIMILAR THING.
INTERSTATE COMMERCE IS GOING TO
AFFECT EVEN THE SMALLEST OF
CONSUMERS. IF THOSE CONSUMERS
AND NOT ME. BUT THE CONSUMER
THAT'S WHO THE CONSTITUENT IS
TODAY THAT CONSUMER IS BUYING A
TICKET FROM THE STATE OF OREGON
OR THE STATE OF NEW JERSEY TO MY
VENUE. WE ARE BOTH THE CUSTOMER
AND MYSELF ARE BOTH IN SAN DIEGO
COUNTY. IF THAT CUSTOMER IS
LEAVING STATE LINES TO PROCURE A
TRANSACTION AND THEN COMING BACK
IN STATE LINES, UH, WE SHOULD
TAKE WHATEVER ENFORCEMENT
MECHANISM GOT SALES TAX DONE AND
APPLY IT RIGHT THERE BECAUSE WE
NEED TO OVERSEE THAT TRANSACTION
BECAUSE IT'S ABSOLUTELY
MURDERING US AND UNNECESSARILY
SO ON A NON SOLD OUT SHOW. UM
YOU KNOW, AND THE OTHER PART OF
THIS TOO, IS UM YOU KNOW MY
KINGDOM FOR SIGNAGE MY KINGDOM
FOR THE SAME SIGNAGE THAT HAS
HELPED US TO INTERRUPT THE FLOW
OF CIGARETTES IN CONVENIENCE
STORES. IT SAYS RIGHT THERE.
CIGARETTES WILL KILL YOU. IT
WOULD BE VERY, VERY AMAZING TO
MY INDUSTRY INDEPENDENT VENUES
650 OF THEM IN THE STATE OF
CALIFORNIA TO MY VENUE, MY
EMPLOYEES IF WHEN YOU GOT TO A
SECONDARY SITE OR A SITE THAT
WAS CLAIMING TO BE ME, I LOVED
THE WEBSITE THAT WAS REFERENCED,
YOU KNOW, MUSIC BOX DOT NOT
REALLY ME.COM. IF YOU GOT TO
THAT WEBSITE, AND IT SAID IN
BIG, BOLD LETTERS I'M NOT THE
PRIMARY SELLER. FACE VALUE
TICKETS MIGHT BE AVAILABLE.
SIMPLE SOLUTIONS. THEY'RE OUT
THERE. AND IT IT. I DON'T KNOW
HOW TO ADMINISTRATE THESE KINDS
OF PROBLEMS. UM I TRUST THAT WE
ALL CARE. I TRUST THAT. WE ALL
KNOW THAT WE'RE CREATING
HARDSHIP. UM I ALSO TRUST THAT
WE UNDERSTAND I. I TOOK THE TIME
TO PHONE UM TREASURES IN
CALIFORNIA. I PHONED THE GENERAL
MANAGER OF THE TROUBADOUR. I
SPOKE WITH THE UM PERSON WHO
RUNS THE FOX THEATER IN
BAKERSFIELD. UM I SPOKE WITH
CASEY LOTTER MILK FROM THE
BELLWETHER. WHO'S HERE WITH US
TODAY? UM I CHECKED MY STORY.
HEY, ARE YOU GUYS SEEING ANY OF
THIS? UM, THERE'S 10 OF US HERE
TODAY. EVERY ONE OF THEM COULD
TELL THIS EXACT STORY. WE JUST
DID IT LAST NIGHT. WE COMPARED
NOTES. WE MADE SURE THIS IS
AFFECTING ALL OF US. EVERY FACT
IN THIS 8020 80% OF THOSE SHOWS
AREN'T SOLD OUT. UH, THE PRICES
ARE 10 TO 40 X FOR NÓ REASON.
AND THAT THEY ARE ALL DOING
WHATEVER THEY CAN FOR TRAGEDIES
AT OUR ROPE LINE. UM I DON'T
HAVE A SLIDE SHOW. YOU KNOW, I
JUST WANNA BE SURE. UM WE WALK
AWAY FROM THIS FROM ALL OF THE
INFORMATION HERE AND WE GET TO
WORK FOR CONSUMERS AND GET TO
WORK FOR THOSE PEOPLE, AND IT
WILL INEVITABLY SAVE MY BUSINESS
. BECAUSE UM, WE HAD AN
ECONOMIST ON THIS PANEL TODAY.
UM UH, IN MY RUDIMENTARY
UNDERSTANDING OF ECONOMY,
CONFIDENCE IS EVERYTHING. CAN'T
IMAGINE WHAT. THIS PARTICULAR
SET OF DISTORTIONS WITHIN THIS
MARKETPLACE IS GOING TO DO IF
GIVEN. TOO MUCH TIME IN OUR
MARKETPLACE. THESE VENUES THAT I
ASSOCIATE WITH THEIR ECONOMIC
DRIVERS. WE WERE GOING TO
DISTRESSED NEIGHBORHOODS. WE GO
INTO PLACES WE FIGHT BLIGHT. YOU
KNOW OUR BUSINESSES WILL COME
INTO, UH, TOUGH NEIGHBORHOODS.
AND NEXT THING YOU KNOW, FIVE
YEARS DOWN THE ROAD, YOU'LL SEE
58 NEW RESTAURANTS. THEY'LL
CENTER AROUND US. THOUGH, UM.
YOU KNOW, TAKE A LOOK AT THOSE
84,000 PEOPLE WHO BOUGHT THOSE
TICKETS AND SELL THEM OTHER
SERVICES AND BECOME ANCILLARY
BUSINESS OF OUR COMMUNITIES. A
BIG PART OF THAT ANCILLARY
BUSINESS. UM ALL OF THOSE PEOPLE
THEY ARE ALL PARTICIPATING IN
THIS TICKET ECONOMY IN THIS
TICKET OF COMEDY ECONOMY IS IN A
CRISIS OF CONFIDENCE, AND I
WOULD LOVE TO SEE WHAT SOLUTIONS
COULD BE PROPOSED. THERE'S A
GREAT SET OF SOLUTIONS PROPOSED
IN THE NATIONAL LEGISLATION. UM,
I KNOW THE ORGANIZATION I'M WITH
ENDORSES THAT NATIONAL
LEGISLATION. I DON'T ALWAYS HAVE
THE GREATEST CONFIDENCE THAT
NATIONALLY, LEGISLATION IS GOING
TO GET INVOKED. NOR DO BUT. I
WOULD TELL YOU THAT IT'S THE
SIXTH LARGEST ECONOMY IN THE
STATE OF CALIFORNIA. WE SHOULD
BE VERY, VERY PROUD OF IT. AND
IF THEY CAN'T GET IT DONE, WE
SHOULD GO TOP DOWN ON WHAT'S
HURTING OUR CUSTOMERS AND MAKE
SINGLE FOCUS LAWS THAT ATTACK
THESE SITUATIONS. IN THESE
DISTORTIONS. I APPRECIATE YOUR
TIME. THANK YOU SO MUCH. I
REALLY APPRECIATE YOU BEING HERE
AND CENTERING THE COMMUNITIES
THAT MATTER THE MOST TO ALL OF
US. I KNOW WHICH IS THE PEOPLE
WE REPRESENT. AND THE ECONOMIES
THAT SUPPORT THEM. UM SOMEBODY
ASKED ME WHERE I WAS IN THIS
DISCUSSION, AND I SAID, I'M WITH
THE CONSUMERS, THE VENUES AND
THE ARTISTS AND HOWEVER BEST WE
PROTECT THE ECOSYSTEM THERE,
BECAUSE THAT'S WHAT MATTERS TO
CALIFORNIA. SO THANK YOU. AND
NOW MOVING TO THE ARTIST'S
PERSPECTIVE. I WILL TURN THE
VIDEO. THANK YOU. UM YEAH, ONE
OF THE DISADVANTAGES OF GOING
LAST IS A LOT HAS ALREADY BEEN
SAID, BUT I'LL TRY TO ADD SOME
NEW SOME NEW INFORMATION HERE AT
LEAST GIVE A DIFFERENT
PERSPECTIVE FROM THE ARTIST'S,
UM MY NAME IS DAVID SHAPIRO. I,
UH I LIVE IN SAN DIEGO. A
COMPANY CALLED SOUND TALENT
GROUP. WE'RE BOOKING AGENCY. WE
REP OVER 300 ARTISTS. WE BOOKED
THEM GLOBALLY ALL OVER THE WORLD
RIGHT HERE IN SAN DIEGO, AND
EVERYWHERE ELSE WE HAVE OFFICES
IN SAN DIEGO, NASHVILLE AND NEW
YORK. AND WE ALSO HAVE PEOPLE IN
L. A UM, AND A NUMBER OF OTHER
PLACES. AH MOST OF US CAME FROM
THE BIG CORPORATE AGENCIES, SO
WE HAVE A LOT OF EXPERIENCE A
LOT OF YEARS UNDER ABOUT. I'VE
BEEN DOING THIS ABOUT 20 YEARS
NOW. REPRESENTING ARTISTS, UM SO
UH, YOU KNOW, I THINK SOMETHING
THAT'S BEEN MADE CLEAR HIS
REFORM IS NEEDED UNCERTAIN
THINGS. UH EVERYONE'S BEEN
TALKING ABOUT ALL IN TICKETING.
SEEMS EVERYONE HERE SUPPORTS
THAT. WE CERTAINLY DO. THE
ARTIST. CERTAINLY DO. I THINK
THERE'S A DISTINCTION, THOUGH,
WITH THE ARTISTS, WHICH IS THAT
WHAT WE WOULD LIKE TO PROPOSE IS
ITEMIZED ALL IN TICKETING. FOR
THE ARTISTS. IT'S VERY IMPORTANT
THAT AT CHECKOUT YOU SEE THE
ACTUAL PRICE? WHEN YOU FIRST SEE
IT, YOU KNOW EXACTLY WHAT IT'S
GOING TO BE. BUT WE'D LIKE TO
CHECK OUT FOR THAT TO BE BROKEN
DOWN. STILL. BECAUSE RIGHT NOW
EVERYONE KNOWS. EVERYONE KNOWS
TICKET FEES ARE A LARGE PERCENT
AND THERE'S ALL THESE OTHER FEES
BUT 510 YEARS FROM NOW, WHEN ALL
IN TICKETING BECOMES THE NORM.
AND THAT'S NO LONGER A THING OF
RECENT HISTORY. PEOPLE WILL
THINK THAT THIS IS THE PRICE OF
THE ARTISTS WANT TO CHARGE AND
ARTISTS WANT TO MAKE IT VERY
CLEAR WHAT THEY'RE CHARGING.
VERSUS WHAT THE ADDITIONAL FEES
ARE SO FROM THE ARTIST'S
PERSPECTIVE, IT'S VERY IMPORTANT
THAT WE MAKE THAT SLIGHT TWIST
AND ADD THE WORD ITEMIZED TO ALL
IN TICKETING. UM I THINK THAT'S
THAT'S VERY IMPORTANT TO THAT
POINT. YOU KNOW, SOMETHING
THAT'S COME UP TODAY IS A LOT OF
THIS EXISTS BECAUSE ARTISTS AH
UNDERPRICE THEIR SHOWS. AH AND I
THINK THAT'S AN IMPORTANT THING
TO ADDRESS. ARTISTS WANT THEIR
FANS TO PAY THE PRICE THAT WE
CHOOSE COLLECTIVELY AS THEIR
AGENT AND ARTISTS WHEN WE TALK
ABOUT IT, BECAUSE ARTISTS DON'T
GET IN THE INTO THIS WHEN
THEY'RE IN THEIR BEDROOMS,
LEARNING HOW TO PLAY HAVING A
DREAM OF GETTING OUT THERE ON
STAGE AND MAKING A LIVING
PLAYING MUSIC. THEY'RE NOT
SITTING THERE THINKING WE NEED
TO CHARGE EVERY SINGLE DOLLAR WE
CAN AND GET EVERY DIME OUT OF
EVERYONE'S POCKETS. THEY WANT TO
MAKE A GOOD LIVING. AND I THINK
TO JOE'S POINT YOU KNOW, WE GAVE
A LOT OF THE TAYLOR SWIFT
EXAMPLES AND THINGS LIKE THAT.
BUT THE OTHER 80% ARE THE
WORKING CLASS ARTISTS, THE
ARTISTS THAT SELL OUT 1 TO 2000
SEATERS. NATIONWIDE GLOBALLY,
AND THEY'RE NOT RICH. THEY'RE
NOT. YOU KNOW THAT THAT THEY'RE
GETTING BY THOSE, UM, BUT THEY
DON'T WANT TO GOUGE THEIR FANS
RIGHT? THEY WANT THEY WANT SHOWS
TO BE PRICED FAIRLY. ULTIMATELY
WHEN SHOWS END UP ON THE
SECONDARY MARKET PLACE, THEY END
UP GOING FOR MUCH HIGHER. UM AND
THE ARTIST DOESN'T GET CUT IN ON
THAT, SO ULTIMATELY, THESE
TICKETS GO FOR THESE PRICES
ANYWAY, AND THE ARTISTS DON'T
RECEIVE ANY BENEFIT. UM. Tð
TICKETMASTER'S CREDIT. I THINK
THEY'VE ACTUALLY DONE A LOT TO
TRY TO COMBAT SOME OF THESE
THINGS. UM THEY DO SOMETHING
CALLED PLATINUM, WHICH UH,
ESSENTIALLY IS DYNAMIC PRICING,
BUT IT PUTS THAT MONEY INTO THE
ARTIST POCKET. UM WHAT THEY ALSO
DO IS THEY ALLOW US AS THE
AGENTS AND THE ARTIST TO DICTATE
SOME OF THE RULES OF THE DYNAMIC
PRICING. UM WE HAVE SHOWS AND
CERTAIN ARTISTS WHERE THEY DON'T
WANT TO DO IT AT ALL.
TICKETMASTER SAYS. THAT'S FINE
SO WE DON'T DO ANY DYNAMIC
PRICING. NO PLATINUM TICKETS. WE
HAVE OTHER ARTISTS THAT YOU KNOW
. THEY'RE LIKE. LOOK WE WANT TO
MAKE HIS BEST LIVING AS
POSSIBLE. GO NUTS. UM AND THEY
WORK WITH US ON THAT THEY ALSO
WORK WITH US ON LIMITING THE
PRICE. SO MAYBE WE SAY OKAY, WE
WANT DYNAMIC PRICING, BUT WE
DON'T WANT IT TO GET TOO CRAZY,
SO IT WON'T GO ABOVE TWO OR $300
OR WHATEVER THE PRICE IS, UM, SO
TICKETMASTER HAS BEEN BEEN
REALLY GREAT TO HELP US WITH ALL
THIS, UM AS FAR AS BOTS GO,
BECAUSE I THINK THAT'S BEEN A
BIG TOPIC TODAY, BUT IT HASN'T
REALLY BEEN ADDRESSED FROM THE
ARTIST'S PERSPECTIVE. AND THIS
IS REALLY CRUCIAL. THIS HAS A
HUGE EFFECT ON THE ARTISTS, THE
DECISIONS THAT ARE MADE TO THE
FOR THE ARTISTS AND THEIR
OVERALL BUSINESS AND BUDGETS ON
THE ROAD. UM THE REASON FOR THAT
. I'LL GIVE YOU AN EXAMPLE. UM
ONE OF OUR ARTISTS, UH, IS
CURRENTLY ABOUT TO EMBARK ON A
FAREWELL TOUR. THEY'RE CALLED
SUM 41. THEY JUST PLAYED JOE'S
VENUE AS AN UNDERPLAY SHOW. AND
UH AND, UM. SO WE JUST PUT THEIR
TOUR ON SALE. UH, WE PLANNED TO
DO TWO NIGHTS IN NEW YORK, AND
OBVIOUSLY IT'S NOT CALIFORNIA,
BUT THIS COULD HAPPEN ANYWHERE.
YEP EXACTLY. THEY ARE PLAYING
HERE TOO. AND UM, SO WE PUT THE
FIRST NIGHT ON SALE. IT'S SOLD
OUT IMMEDIATELY. WE PUT THE
SECOND NIGHT ON SALE. WELL COME
TO FIND OUT. THERE WERE OVER 800
BOTS ON A 2500 CAPACITY VENUE.
SO WHAT ENDED UP HAPPENING WAS
WE HAD TO RETURN THOSE TICKETS.
AND NOW WE HAVE A SHOW ON THE
SECOND NIGHT THAT'S HALF SOLD,
AND NOW HE WAS SHOWING THE FIRST
NIGHT. THAT'S YOU KNOW, THREE
QUARTERS SOLD OR TWO THIRDS SALT
WHERE WE WERE SOLD OUT WHEN WE
MADE THAT DECISION, BUT ONE OF
THE BIGGEST PROBLEMS AND THIS IS
SOMETHING THAT THAT I DON'T KNOW
HOW IT HASN'T BEEN SOLVED YET.
BUT BUT REPORTS TYPICALLY TAKE A
WEEK TO COME IN. SO WE HAVE TO
MAKE DECISIONS A LOT OF TIMES.
IN THE MOMENT BEFORE WE HAVE THE
ACTUAL INFORMATION AND THE FACT
THAT IT'S TAKES A WEEK STILL IS,
UH, IS A PROBLEM THAT REALLY
NEEDS TO BE SOLVED. FURTHERMORE
THE ACCURACY OF THESE BAT
REPORTS ISN'T ALWAYS PERFECT.
UM, ANOTHER EXAMPLE IS ANOTHER
ARTIST. WE HAVE CALLED. JUST
STOP YOU RIGHT THERE, BECAUSE I
WAS CONFUSED BY SOMETHING YOU
SAID SO AND THIS MAY BE
PARTICULARLY IN NEW YORK. BUT
BECAUSE IT WAS ABOUT YOU HAD TO
RETURN THE TICKETS. OKAY, SO THE
WAY THAT THIS WORKS YEAH, AGAIN
BECAUSE THIS HASN'T COME UP FROM
THE ARTIST'S PERSPECTIVE, BUT
WHAT HAPPENS IS WHEN WE GET BACK
REPORTS THE PROMOTERS WILL COME
TO US AND SAY, DO YOU WANT TO
CANCEL THESE TICKETS AND PUT
THEM BACK ON THE PRIMARY
TICKETING SITE? MOST ARTISTS
WILL SAY YES. GOT IT. OKAY ALL
THE TIME. BUT MOST OF THE TIME
THEY WILL BECAUSE AGAIN THEIR
INTENTION WAS TO SELL TICKETS
FOR THE FACE VALUE. SO THAT'S
WHAT THEY WANT THEIR FANS TO
GET. NOW THIS CREATES A HUGE
PROBLEM BECAUSE WHAT HAPPENS IS
FANS GO AND BUY THOSE TICKETS ON
THE SECONDARY MARKET. AND THEN
THOSE TICKETS GET CANCELED. SO
NOW. THEY'VE TRIED TO BUY
TICKETS THE FIRST TIME NOW THEY
TRY TO BUY IT THE SECOND TIME
THEY GOT CANCELED. NOW THEY GO
BACK TO THE PRIMARY SITE WHEN
THEY GET BACK LIVE ON.
TICKETMASTER ACCESS OR WHOEVER.
AND SOMETIMES THAT CYCLE HAPPENS
FOUR OR FIVE TIMES FOR ONE SHOW.
BECAUSE BOTS WILL BUY THE
RETURN. BUT TICKETS SO THIS IS A
CYCLE THAT GOES OVER AND OVER.
SO THE LARGER THE SHOW. THE MORE
TIMES THAT CYCLE HAPPENS BECAUSE
THE HIGHER CAPACITY THE MORE
TICKETS ARE BOUGHT THROUGH, BUT
SO IT CAN CREATE A REAL PROBLEM
BECAUSE NOW AN ARTIST LIKE THAT
WE CREATED A BUDGET BASED ON
DOING TWO SHOWS THAT WE THOUGHT
WOULD SELL OUT. AND NOW WE'RE
BEHIND THE EIGHT BALL, AND IT'S
GOING TO AFFECT THE MERCH
NUMBERS THAT NIGHT. THE WHOLE
BUDGET TRICKLES DOWN, RIGHT? UM
SO THE OTHER POINT WAS ABOUT TO
MAKE WAS THAT ANOTHER ARTIST
THAT WE WORK WITH A BAND CALLED
I PREVAIL. UM THEY JUST FINISHED
THEIR HEADLINE TOUR LAST LAST
FALL. AH THEY PLAYED CHICAGO
CHICAGO. WE GOT A REPORT THAT
WAS PRETTY HEAVY. UM, SO WE
DECIDED TO CANCEL THEM. RETURN
THEM PUT THEM BACK IN THE
PRIMARY SITE. WHAT ENDED UP
HAPPENING WAS THE ACCURACY OF
THAT, BUT REPORT WAS WAS NOT
GREAT. UM AND WE ENDED UP HAVING
FANS. WE HAD FANS COME TO US.
UPSET SAYING WE BOUGHT
LEGITIMATE TICKETS. LIKE WHY
WERE THEY CANCELED? AND THEN THE
SHOW SOLD OUT, AND THOSE PEOPLE
THAT HAD LEGITIMATE TICKETS NO
LONGER HAD TICKETS TO THE SHOW,
AND NOW THEY'RE PAYING DOUBLE
TRIPLE QUADRUPLE THE PRICE.
SECONDARY MARKET. SO UH, YOU
KNOW, FROM THE ARTIST'S
PERSPECTIVE. A LOT OF THEM.
DON'T EVEN UNDERSTAND ALL THIS
RIGHT LIKE IT'S SO I MEAN, WE DO
THIS EVERY DAY, AND IT'S HARD TO
KEEP UP WITH WITH ALL THE
TECHNOLOGY AND DIFFERENT THINGS
HAPPENING SO I THINK THE BIGGEST
THE BIGGEST NEED. THERE IS SOME
SORT OF AH! BETTER TECHNOLOGY
AND FURTHER REGULATION OF BOTS.
AND I KNOW THAT BOTS ARE ALREADY
NOT LEGAL, BUT CLEARLY THAT
DOESN'T MATTER, AND THERE'S
SOMETHING THAT NEEDS TO HAPPEN
THERE. UM BUT ESPECIALLY THE
TECHNOLOGY HAS GOT TO GET
BETTER. IT'S GOT TO BE MORE
ACCURATE AND SCOTT TO TAKE LESS
THAN A WEEK FOR THEM TO GENERATE
THESE REPORTS. UM AND, UH, UM
YEAH. JOE MADE MENTION OF THIS,
BUT ON THE SECONDARY MARKET.
ANOTHER PROBLEM WE RUN INTO IS A
LOT OF TIMES, PEOPLE WILL BUY
TICKETS FOR MORE BECAUSE THEY
THINK IT'S A BETTER TICKET.
RIGHT PEOPLE THINK. OH, IT COSTS
MORE MONEY. IT MUST BE A BETTER
TICKET. IT'S SOME SORT OF
PREMIUM TICKET. UM YOU KNOW
AGAIN, TAKING TICKETMASTER HAS
ACTUALLY DONE A GOOD JOB WITH
THIS BECAUSE THEIR THEIR RESALE,
UH, PLATFORM IS TÌM PLUS, WHICH
INTEGRATES WITH THEIR ACTUAL
PLATFORM, AND IT SAYS RIGHT
UNDER THE REAL TICKET, VERIFIED,
VERIFIED RESALE TICKET AND THEY
DO VERIFY IT. SO AGAIN, THEY'VE
THEY'VE DONE A PRETTY GOOD JOB
AT ADDRESSING THESE ISSUES WITH
THE ARTISTS AND WITH US UM BUT,
UH YOU GO TO OTHER PLATFORMS
THAT ARE NOT TICKETMASTER AND
YOU KNOW THAT THERE'S REALLY
THERE'S NO TRANSPARENCY. NO ONE
KNOWS WHAT THEY'RE BUYING
SPECULATIVE TICKETING. I MEAN,
IT'S IN THE NAME. IT'S
SPECULATIVE. YOU DON'T HAVE AN
ACTUAL TICKET, SO THAT JUST
SHOULD BE. FLAT OUT KILLED LIKE
THAT, THAT THERE'S NO REASON ANY
FORM OF SPECULATIVE TICKETING
SHOULD HAPPEN. NO ARTIST WANTS
PEOPLE BUYING TICKETS TO THEIR
SHOWS THAT DON'T EXIST YET. UM
THAT JUST THERE'S A REASON THAT
WE COORDINATE. ON SALES FOR OUR
SHOWS AND HAVE THEM ANNOUNCED
AND GO ON SALE AT CERTAIN TIMES
A LOT OF TIMES THOSE HAVE TO DO
WITH COORDINATING WITH THE NEW
SONG RELEASE AN ALBUM RELEASE.
THERE'S A MUCH BIGGER PICTURE
FOR THE ARTIST GLOBALLY. SO WE
HAVE ALL THESE SPECULATIVE
TAKING ALL THESE THINGS
HAPPENING. IT JUST TAKES ALL
THAT AWAY. UM AND IT CAN REALLY
HURT THE ARTIST. SO UM. YEAH I
THINK ULTIMATELY, EVERYONE HERE
SEEMS TO ACTUALLY BE ON THE SAME
SIDE. UM YOU KNOW, ON MOST OF
THESE ISSUES AND I THINK WE'RE
JUST LOOKING FOR ANY HELP WE CAN
GET. BUT WE APPRECIATE YOU GUYS
LISTENING, AND I THINK THAT THE
ARTISTS, UH YOU KNOW, IT'S
IMPORTANT TO THEM THAT THIS
STUFF GETS ADDRESSED. THANK YOU.
I KNOW THAT A LOT HAS MADE IT
HARD FOR ARTISTS. IN THE LAST
COUPLE OF DECADES, SO WE DON'T
WANT THIS TO BE ONE MORE THING.
UM MR CHAIR QUESTION. THANK YOU
VERY MUCH AGAIN. JUST WANT TO
REITERATE THAT THIS HAS BEEN AN
EYE OPENING EXPERIENCE. UM ALL
THAT I HEARD THUS FAR AND LIKE
MY COLLEAGUE CHAIRWOMAN, WE WANT
TO PROTECT THE CONSUMER. RIGHT
IN THE ARTIST'S RIGHT BECAUSE
THOSE HAVE A LOT TO LOSE. UM AND
I KNOW THERE WAS MADE A
STATEMENT REGARDING, UM EXISTING
LAWS JUST BEING ENFORCED RIGHT?
UM ONE. IF ANYONE HAD ANY
KNOWLEDGE, HAVE ANYONE BEEN
CAUGHT? OR ANY NAMED
ORGANIZATION OR COMPANY. UM ARE
IN FACT BEHIND BOTS THAT YOU CAN
SHARE WITH US. AND IF SO, I SEE
THE PROFESSOR SHAKING HIS HEAD.
YES BECAUSE ONE OF THE THINGS I
WANT TO EXPLORE IS A PENALTIES
WOULD ABSOLUTELY LOVE TO EXPLORE
PENALTIES AS WELL AS UH,
PROSECUTION. MHM BECAUSE UNTIL
THAT HAPPENS. YOU KNOW, WE'LL
CONTINUE TO HAVE THESE BAD
ACTORS EVEN WHEN IT COMES DOWN
TO, YOU KNOW, IN MY WORLD WITH
ILLEGAL CANNABIS GROWERS. UM YOU
KNOW, THEY WERE SHUT HIM DOWN,
AND THEN IT PARALYZED. I MEAN,
THEY MATERIALIZED. IT'S ALMOST
LIKE YOU KILLED CHUCKIE. HE JUST
APPEARS IN YOUR CLOSET AND YOU
OPEN IT UP. CHUCKY COMES BACK
OUT AGAIN. THE BOXER CHUCK IT
EXACTLY. UM, AND SO I GUESS MY
QUESTION IS AGAIN. HAVE ANYONE
HAVE THAT YOU ARE AWARE OF HAVE
EVER BEEN CAUGHT IN NAMED AND IF
SO. IF YOU HAVE ANY KNOWLEDGE OF
WHAT ACTUALLY HAPPENED TO THAT
INDIVIDUALS OR COMPANIES NOT TO
MY KNOWLEDGE GONNA GET THIS
WRONG AND MAYBE UNTIL THAT THAT
MUCH OF THE PROFESSORS SEEM TO
KNOW THE ANSWER. THE BOX ACT WAS
PASSED IN 2016. I BELIEVE
THERE'S BEEN A HANDFUL OF
ENFORCEMENT ACTION IS THE
FEDERAL TRADE COMMISSION. I WANT
TO SAY ONE AFTER THREE OF THEM A
COUPLE OF YEARS AGO, UM UM, FOR
VIOLATING THE BOX ACT AND AGAIN,
I THINK THERE WAS THERE. THERE
WERE CONSIDERABLE PENALTIES, BUT
THIS IS LIKE THREE COMPANIES.
AND HE SAID, FOR YOUR ONE SHOW
YOUR ONE SHOW LIKE 800 BAHTS FOR
2500% VENUE. I THINK THE THOUGHT
IS OKAY IF I GET CAUGHT, THAT'S
TERRIBLE, BUT IT'S LIKE A ONE IN
1000 CHANCE. I'LL GET CAUGHT THE
FEDERAL TRADE COMMISSION
FAMOUSLY LIKE HISTORICALLY
UNDERFUNDED THEY HAVE, LIKE, YOU
KNOW, LIKE 500 PEOPLE IN ALL OF
CONSUMER PROTECTION, WORKING ON
ALL THE ISSUES SO THEY HAVE,
LIKE, MAYBE ONE PERSON. NOT EVEN
THAT I THINK OF THE RIGHT OF
PRIVATE ENFORCEMENT COULD HELP
WITH THAT. BUT ALSO THE
CALIFORNIA A G S OFFICE IS
PROBABLY EVEN WORSE. I USED TO
WORK FOR THE NEW YORK ATTORNEY
GENERAL'S OFFICE. I WAS IN THE
INTERNET BUREAU. WE HAD, LIKE
FOUR PEOPLE FOR THE INTERNET. SO
I WAS LIKE IT JUST DOESN'T THE
REGULAR SYSTEM THE CAPACITY TO
KEEP UP WITH IT. RIGHT I CAN
APPRECIATE YOU SHARING THAT WITH
US. UM YOU KNOW JUST ANY AGAIN
THE EXAMPLES AND ALSO YOUR OWN
LIVE LIFE EXPERIENCE WITH
RESPECT TO GO INTO THE WEBSITE
AND SING IN THIS A FRAUDULENT,
UH, WEBSITE AND PEOPLE ARE BEING
TAKEN IN IT'S YOU KNOW, IT JUST
SEEMS LIKE TRYING TO FIGURE OUT.
I MEAN, YOU KNOW, SOME OF THOSE
WEBSITES HAS A BLUE CHECK THAT
LEGITIMIZE THAT ACTUAL WEBSITE.
I MEAN, I'VE DONE HOTELS,
AIRLINES THE WHOLE NINE YARDS
AND COME TO FIND OUT. IT'S NOT
SOUTHWEST. IT'S NOT THE HILTON.
UM IT'S A THIRD PERSON, AND THEN
THERE'S ALL THESE CHARGES THAT
GOES ALONG WITH IT. AND IT'S
SOMETHING TO SEE AND FIGURE OUT
WHAT WHAT AUTHORITY DO WE HAVE
IN THAT JURISDICTION, TRY TO GO
AFTER HIM AND LEVEL PENALTIES
AND NOT LIMITING TO PROSECUTION
BECAUSE PEOPLE AS YOU HAVE
INDICATED WE HAVE A POTENTIAL
BUSINESS. HOPE IT DOESN'T
HAPPEN. YOU KNOW WE CAN HAVE
BUSINESSES GO OUT OF BUSINESS.
UM AND THEN YOUR NAME IS SMEARED
AND YOUR REPUTATION IS TARNISHED
, RIGHT? AND AGAIN, UM PEOPLE
WALK AWAY WITH A BAD EXPERIENCE,
AND THEY BLAME YOU FOR THE
EXPERIENCE AND THAT'S GROSSLY
UNFAIR. SO UH, AGAIN, I
APPRECIATE THE DIALOGUE AND THE
CONVERSATION AND YOU'VE GIVEN US
A LOT OF A LOT OF PROOF OF
THOUGHT TO THINK ABOUT WHAT WE
NEEDED. TO CREATE AROUND
POSITIVE, UH, LEGISLATION AND
LEGISLATION WITH TEETH. THANK
YOU. UM. IT'S FUNNY THAT
EVERYTHING IN THIS COMMITTEE
ALWAYS COMES BACK TO SECTION 230
REFORM. BUT SOME OF THE SEARCH
ENGINE OPTIMIZATION IS BECAUSE
THE SEARCH ENGINES ARE NOT ON
THE HOOK FOR THESE FRAUDULENT
WEBSITES THAT THEY PROFIT OFF OF
PUTTING IT THE TOP OF THE SEARCH
BAR SO I'LL JUST ADD SECTION 230
REFORMED THE LIST OF THINGS WE
NEED TO DO. UM SO I HAVE A
QUESTION FOR YOU. SO YOU
MENTIONED THAT WHOLE BOD
SCENARIO. NOW WE JUST HEARD FROM
TWO DIFFERENT PRIMARY TICKET
SELLERS, ONE OF WHOM SEEMS TO
HAVE FIGURED OUT A TECHNOLOGICAL
SOLUTION TO ADDRESS WHAT YOU'RE
TALKING ABOUT, RIGHT? THEY PRE
AUTHORIZED THE CHARGES FOR THE
ADDITIONAL FOLKS. THE ARTIST CAN
THEN BE GUARANTEED THAT IF THEY
PULL BACK THE BOTS THAT THEY'RE
PAID. BUT I GET THE SENSE THAT
YOU PRIMARILY SELL ON
TICKETMASTER. IS THAT CORRECT?
AND IF SO, WHY AREN'T YOU USING
THESE COMPETITIVE TECHNOLOGIES
THAT MIGHT SOLVE YOUR PROBLEMS?
IT'S NOT UP TO US WHO? WE. OKAY
SO WHEN WE BOOK SHOWS OR TOURS,
EACH VENUE HAS A CONTRACT WITH
IT WITH IT. WITH THE TICKETING
PLATFORM, SO WHEN WE BOOK SHOWS
WE'RE BEHOLDEN TO THE VENUE.
WHOEVER THAT PLATFORM IS OKAY,
SO YOU KNOW IF WE'RE BOOKING A
SHOW AT AN AGGIE VENUE. IT'S
ACCESS. IF IT'S A LIVE NATION
VENUE. IT'S TICKETMASTER. IF
IT'S AN INDIE, IT COULD BE
ANYONE. UM AND YOU KNOW, AND
THOSE EXCLUSIVE, UH, CONTRACTS
ARE IMPORTANT. YOU KNOW, THAT
CAME UP A LITTLE BIT EARLIER. UM
I THINK THEY ARE IMPORTANT FOR
THE PROMOTERS TO SURVIVE BECAUSE
WE'VE SAID THIS BEFORE, BUT WE
ALL WE ALL NEED EACH OTHER TO
SURVIVE. UM AND USUALLY THEY GET
ADVANCES AND THINGS LIKE THAT IN
THEIR CONTRACTS, AND THAT'S HOW
A LOT OF THESE VENUES STAY
AFLOAT. SO, UM, IT IS IT IS
IMPORTANT, BUT, UM, YEAH,
TICKETMASTER OBVIOUSLY HAS THE
LARGEST SHARE OF THE MARKET. SO
IT'S JUST AN EASY EXAMPLE. AND
AS I MENTIONED, I DO THINK
THEY'VE DONE A LOT TO ADDRESS A
LOT OF THESE PROBLEMS. UM MORE
THAN OTHERS HAVE. BUT THESE
ISSUES EXIST EVERYWHERE. NO
MATTER WHAT I MEAN THE BOTS NO
MATTER WHAT YOU DO, THEY GET
THROUGH AND IT'S A PROBLEM. YEAH
WELL, MAYBE MORE COMPETITION IN
THE TICKETING MARKETING PLACE
WOULD HELP GET THAT TECHNOLOGY
ACROSS PLATFORMS WHICH WOULD
BENEFIT IT SEEMS THE ARTISTS UM
OKAY? AND I WANTED TO, UM,
TOUCH, MR BRUCKMAN. YOU
MENTIONED A LOT OF WHAT WAS SAID
HERE TODAY AND YOUR PERSPECTIVE
ON IT FROM THE CONSUMER TO
PROTECT CONSUMERS. I DON'T KNOW
THAT I HEARD YOU MENTIONED THE
QUESTION ABOUT DRIP SALES AND
HOLD BACKS, SO I WAS CURIOUS TO
GET YOUR INPUT ON THAT. YEAH. I
DON'T HAVE A STRONG INTEREST. I
HEARD I WAS VERY INTERESTED IN
CONVERSATION. I CAN SEE THE
ARGUMENTS FROM BOTH SIDES. UM I
WILL SAY, I HAVE HEARD SOME
ARTISTS COMPLAINED THAT IF YOU
TELL PEOPLE I'M THINKING OF THE
DOCUMENT THAT TICKETMASTER MADE
THAT IF YOU TELL HOW MANY
TICKETS ARE AVAILABLE OFF UP
FRONT, UM THEN THAT CAN GIVE
SIGNAL TO THE SECONDARY MARKET
PLAYERS TO JACK UP THE PRICES.
UM UM I DON'T KNOW. UH MAYBE
THERE'S SOME SOME SOME SOME
LEGITIMACY TO THAT. I THINK
PEARL JAM HAS MADE THAT
ARGUMENT, FOR EXAMPLE, UM UM
YEAH. I JUST DON'T HAVE ENOUGH
INSIDE THE ACTUAL TECHNIQUES OF
HOW IT WORKS. TO KNOW HOW. HOW
MUCH OF A PROBLEM THAT IS OKAY.
NO WORRIES. I JUST WANTED TO
GIVE YOU THE OPPORTUNITY IN CASE
YOU DID KNOW, WE WERE JUST WE
WERE TALKING ABOUT THIS
YESTERDAY WITH SOME MEMBERS OF
THE LEGISLATURE AND ONE OF THEM
HAD BOUGHT TICKETS TO A CONCERT
IN SOUTHERN CALIFORNIA. SHE THEN
COULDN'T GO TO THE CONCERT WENT
TO RESELL IT AND THAT THE ARTIST
HAD, I GUESS SENT A DEAL. I
THINK WITH TICKETMASTER THAT IT
COULD ONLY BE RESOLD AT FACE
VALUE AND SHE FELT WAS FAIR. SHE
COULD RESELL THE TICKETS SHE
COULD RECOUP BECAUSE SHE
COULDN'T MAKE IT. BUT I WASN'T
DRIVING THE PRICE UP. SO SHE
FOUND THAT INTERESTING AGAIN.
IT'S NOT MANDATED, BUT IT WAS A
CHOICE THAT I THINK THE ARTIST
HAD MADE. AND OBVIOUSLY THE ONLY
THE ARTIST CAN ONLY CONTROL IT
AT THE PRIMARY LEVEL SO SHE
COULD HAVE GONE AND SOLD THAT
TICKET FOR WHATEVER SHE WANTED
ON. STOP HOWEVER, WHEREVER
INTERESTING, BUT IF SHE RESOLD
IT ON TICKETMASTER. WAS IT
POSSIBLE TO MAKE THAT ORIGINAL
DEAL WITH TICKETMASTER NÓ. UM
SORRY. REPEAT, THE MASTER HAS A
RESALE NOTE. OKAY, WE'RE GETTING
A NOTE FROM TICKETMASTER.
INTERESTING I WONDER WHERE SHE
EXPERIENCED THAT. SHE TOLD ME
THE WHOLE STORY, GO BACK AND
REVISIT IT. AND ALSO TO ADDRESS
THE QUESTION YOU JUST ASKED,
LIKE AS AS AGENTS. DEALING WITH
THE ARTISTS. WE WILL NEVER ALLOW
TICKETS TO BE HELD BACK. TO BE
SO OUR GOAL IS TO PUT AS MANY
PEOPLE IN THE BUILDING AS
POSSIBLE. SO IF WE FIND OUT
THAT'S HAPPENING, WE'RE GONNA
WE'RE GONNA FORCE ALL THOSE
TICKETS BE OPENED UP. BUT THAT
REALLY DOESN'T HAPPEN OFTEN.
OKAY MAYBE THAT IT'S NOT IN THE
ARTIST CONTEXT. WE'RE TALKING
ABOUT TICKETING ACROSS. LIKE I
SAID, I THINK I HEARD FROM THE
SPORTS TEAM. SO THAT'S SOMETHING
THAT MAY HAPPEN IN THEIR
CONTEXT, WHICH IS DIFFERENT. UM
AGAIN AND YOU HAVE TEAMS LIKE
YES, THAT HAVE TROUBLE SELLING
TICKETS SITUATION. UM SO THANK
YOU GUYS. I REALLY APPRECIATE
THIS PERSPECTIVE AND WE
INTENTIONALLY WANTED TO CLOSE BY
CENTERING THE CONSUMERS, SO I
REALLY APPRECIATE ALL OF YOU
HELPING US DO THAT, BECAUSE WHAT
WE WANT HERE IS TO MAKE SURE
CALIFORNIANS WHEN IN THIS
CONVERSATION, SO THANK YOU.
THANK YOU TO EVERYONE WHO'S BEEN
HERE. WE ARE GOING TO OPEN IT UP
FOR PUBLIC COMMENT. I KNOW SOME
FOLKS WERE HERE AND THEY DID NOT
HAVE THE OPPORTUNITY TO WEIGH
IN, SO THIS WILL BE YOUR
OPPORTUNITY. TRYING TO GET A
SENSE FOR HOW MUCH TIME? UM I
THINK WE'RE GONNA TRY FOR WE
WANTED TO OKAY. WE'LL TRY FOR
TWO MINUTES EACH SO COME ON UP
AND GO AHEAD. MAKE SURE NAME AND
ORGANIZATION AND COMMENT CHAIR
AND MEMBERS ALEX TORRES WITH
BROWNSTEIN HYATT ON BEHALF OF
THE NATIONAL INDEPENDENT VENUE
ASSOCIATION OF CALIFORNIA. I'VE
HAD THE OPPORTUNITY TO WORK WITH
THIS GROUP FOR THE LAST FOUR
YEARS, AND I THINK TO PIGGYBACK
ON SOMETHING MR RINALDI IS
POINTS. UM YOU KNOW, THE
LEGISLATURE SAVED THESE VENUES,
100 AND 50 MILLION IN THE BUDGET
FOR THE CALIFORNIA VENUES GRANT
PROGRAM. AND NOW WE'RE DEALING
WITH REAL CHALLENGE A REAL
CRISIS OF CONFIDENCE AS MR
RINALDI PUT IT IN THE INDUSTRY
AND THE ABILITY OF VENUES TO
HAVE TO PUT ON SHOWS AND
CONSUMERS ARE REALLY FIXING THAT
BLAME TO THE VENUES AND SO AS
INDEPENDENT VENUES ARE, YOU KNOW
THE MARGINS AND YOU HEAR IT FROM
THESE FOLKS THAT ARE BEHIND ME.
THE MARGIN IS VERY DIFFICULT.
75% TICKETS WILL GET YOU ABOUT
75% TO PROFITABILITY. THE REST
IS PEOPLE ACTUALLY SHOWING UP AT
YOUR SHOWS AND WITH THE VENUE IF
YOU'RE LOOKING AT IT ON PAPER
AND YOUR SHOULDER, YOUR SHOW IS
SOLD OUT. YOU'RE GOING TO BRING
IN AN EXTRA BARTENDER. YOU'RE
GOING TO BRING IN AN EXTRA DOOR
GUY. ANOTHER SECURITY? UH,
ANOTHER SECURITY STAFFER. ONLY
TO HAVE A SHOW BE 65% FULL 70%
0.4, AND SO, UH AND AGAIN, I
THINK I WOULD EMPHASIZE THE ROLE
OF INDEPENDENT VENUES. THE
OPERATORS HERE AS FIRST
RESPONDERS IN EVERY ASPECT THAT
YOU HEARD TODAY WHETHER IT'S
BOOKING THE SHOW, WORKING WITH
THE AGENTS AND THE NEEDLE, FOLKS
, UH, MAKING SURE THE LOGISTICS
ARE GOOD MANNING THAT ROPE LINE
THEY ARE TRULY THE FIRST
RESPONDERS. THEY HAVE FOLKS
STAFFING BOX OFFICES SO YOU CAN
COME UP AND PHYSICALLY BUY A
TICKET. IF YOU, YOU KNOW, BUY A
TICKET THAT WAY. BUT THEY'RE
REALLY INTEGRAL TO EVERY PART OF
THIS AND AGAIN, I THINK YOU
KNOW, IT WAS GREAT TO HAVE A
VENUE REPRESENTATIVE AT THE
DIOCESE TODAY AND THANK YOU FOR
THIS HEARING. THANK YOU FOR
INCLUDING US, BUT GOING FORWARD,
YOU KNOW, IT'S GOT TO BE MORE
THAN JUST THE PLATFORMS. THE
VENUES ARE REALLY CRITICAL IN
THIS, SO THANK YOU AGAIN FOR
YOUR TIME AND HAVE SOME FOLKS
FROM THROUGHOUT THE STATE HERE
THAT I'LL TELL A LITTLE BIT
ABOUT THEIR EXPERIENCES THERE.
THANK YOU. HI GOOD AFTERNOON,
MADAM CHAIR AND MR CHAIR. UM
ROBERT HORRELL. I'M THE
EXECUTIVE DIRECTOR OF THE
CONSUMER FEDERATION OF
CALIFORNIA. WE'RE A NONPROFIT
ADVOCACY REGULARLY BEFORE THIS
COMMITTEE IN VARIOUS AND SUNDRY
ISSUES. I HAVE A NUMBER OF
POINTS. I WILL ENDEAVOR TO MAKE
THEM IN UNDER TWO MINUTES NUMBER
ONE GREAT BACKGROUND PAPER.
ALWAYS THE CASE. HIGH STANDARD
OF QUALITY OF CONSULTANT WORK AT
THIS COMMITTEE. AH. TO LET'S NOT
PRETEND WERE LARGELY HERE
BECAUSE THIS IS AN INDUSTRY
WHERE THERE WAS A MONOPOLY. I
KNOW PEOPLE DON'T LIKE TO SAY
THE M WORD, BUT IT'S ONE OF THE
MAIN REASONS WHY WE'RE STANDING
HERE AND SITTING HERE TODAY. UM
YOU'RE RIGHT, MADAM CHAIR. THE
FEDS DO HAVE PRIMARY
JURISDICTION ON ANTITRUST. THERE
ARE ACTIVE INVESTIGATIONS BY THE
FEDERAL DEPARTMENT OF JUSTICE BY
A NUMBER OF A GS, INCLUDING THE
CALIFORNIA AGGIE INTO
ANTICOMPETITIVE PRACTICES IN
THIS VERY INDUSTRY, SO LET'S NOT
HIDE FROM THAT. THERE ARE SOME
STEPS WHICH I WON'T GO INTO
RIGHT NOW THAT THE STATE COULD
TAKE TO TRY TO ENHANCE
COMPETITION TO TRY TO GET AT
THAT WITHOUT DIRECTLY DEALING
WITH THE ANTITRUST CHALLENGE OF
THE AT THE FEDERAL LEVEL. UM
NUMBER 3 18% I GO TO A DECENT
NUMBER OF SHOWS. I ALSO HAVE A
13 YEAR OLD DAUGHTER WHO'S A BIG
POP FAN. SO I'M ON THOSE CUES
INCESSANTLY LOOKING FOR TICKETS.
UM I CAN'T REMEMBER THE LAST
TIME I BOUGHT A TICKET WHERE I
PAID 18% ABOVE THAT IN FEES, SO
LET'S USE THAT AS THE STARTING
POINT. FOR A CAP ON FEES ABOVE
FACE VALUE. THAT'S THE NUMBER
THAT THE TICKETMASTER
REPRESENTATIVES SAID HIMSELF IN
HIS OWN SLIDES. LET'S USE THAT
TO START. NUMBER FOUR. ALL IN
PRICING. I THINK THERE IS PRETTY
MUCH UNIVERSAL AGREEMENT, BUT
LET'S BE CAREFUL ABOUT HOW THAT
GETS PARSED OUT THE EXAMPLE OF
THE MONOPOLY. AFTER BEING WITH
THE PRESIDENT, UNITED STATES AND
SAYING, WE'RE GOING TO DO ALL IN
PRICING AT THE END OF THE SUMMER
CONCERT SEASON, SO WE CAN RECALL
THAT IN THEN, WHEN IT ACTUALLY
WAS SUPPOSED TO HAPPEN. THEY
SAID. OH WE THOUGHT WE WERE VERY
CLEAR. WE MET ONLY FOR THE
VENUES THAT WE OWN. NOT FOR ALL
THE OTHER VENUES HAVE TO ASK
YOU. THAT'S A CHALLENGE. UM THE
NATIONAL CONVERSATION IS MORE
ADVANCED THAN THE STATE
CONVERSATION, WHICH IS TROUBLING
AND RARE. UM WE SUPPORT THAT
HOUSE BILL THAT GOT OUT 45.
NOTHING AS WELL. THERE'S SOME
GOOD STEPS IN THAT. HOPEFULLY
SOMETHING WILL HAPPEN, BUT I'M
NOT HOLDING MY BREATH. TERMS AND
CONDITIONS ARE A BIG CHALLENGE.
AND UM, THE TEAMS. IT'S AMAZING
MADAM CHAIR THAT THE TEAMS
AREN'T HERE BECAUSE THEY WERE
HERE AT EVERY SINGLE BILL HERE
HEARING THE PAST TWO YEARS ON
EVERY BILL, AND USUALLY THEY
WERE COORDINATING THEIR
TESTIMONY WITH THE MONOPOLY. UM
THERE ARE SOME AREAS OF
AGREEMENT. WE LOOK FORWARD TO
WORKING WITH YOU AND ALL THE
INTERESTED PARTIES ON THIS
MATTER. THANK YOU APPRECIATE IT.
MADAM CHAIR, MR CHAIR AND
MEMBERS COURTNEY JENSEN ON
BEHALF OF PSYCHIC AND TICK PIXIE
KIK EVOLVED FROM BEING A LEADING
RESALE MARKETPLACE TO ENTERING
THE PRIMARY TICKETING MARKET IN
2016 WHEN IT REALIZED THAT THE
PRIMARY TICKET ER IN MOST CASES,
TICKETMASTER CONTROLS SO MUCH OF
WHAT HAPPENS IN THE ENTIRE
TICKETING ECOSYSTEM THROUGH ITS
EVOLUTION SEEK HAS SOUGHT TO
MAINTAIN FOCUS ON THE CONSUMER.
WE ALLOW CONSUMERS TO SEE THE
ALL IN PRICE BUT TICKET AS WELL
AS A BREAKDOWN OF FEES EARLY IN
THE PURCHASE PROCESS. TAKE PICK
IS A SECONDARY TICKET
MARKETPLACE CONNECTING BUYERS
AND SELLERS OF TICKETS FOR
EVENTS HELD IN THE US, THEY
DIFFERENTIATE THEMSELVES BY
SHOWING ALL IN PRICING FOR ALL
EVENTS IN EVERY STATE, THE FIRST
PRICE THEIR CONSUMER SEIZES THE
PRICE THEY PAY FOR THEIR TICKETS
. FOR FAR TOO LONG FANS HAVE
LACKED IMPORTANT CONSUMER
PROTECTIONS THAT OTHER
INDUSTRIES TAKE FOR GRANTED.
YOU'VE HEARD A LOT ABOUT SB 478
TODAY. WE AGREE IT IS A GREAT
STEP IN THE RIGHT DIRECTION ON
ALL IN PRICING. HOWEVER WE
REMAIN CONCERNED THAT BECAUSE
LAST YEAR'S LEGISLATION WAS NOT
TICKETING SPECIFIC PICK. IT MAY
NOT BE IMPLEMENTED CONSISTENTLY
THROUGHOUT THE INDUSTRY AND LOOK
FORWARD TO CONTINUING TO DISCUSS
THAT. CALIFORNIANS ARE BEST
SERVED WHEN THE TICKETS THEY BUY
ARE FULLY TRANSFERABLE, AND THEY
HAVE ABILITY TO CHOOSE WHICH
MARKETPLACE THEY TRANSACT ON. SO
WE BELIEVE THAT THEY NEED TO
CONTINUE TO BE ALLOWED TO SELL
AND TRANSFER THEIR TICKETS IN
THE PLACE THAT THEY CHOOSE, HAS
HAD MODEST SUCCESS SINCE
ENTERING THE PRIMARY TICKET
MARKET NEARLY EIGHT YEARS AGO.
AS OF A FEW WEEKS AGO, THEY
PROBABLY COUNT THE SACRAMENTO
REPUBLIC FOOTBALL CLUB AS A
TICKETING CLIENT, AND THEY ARE
ALSO THE PRIMARY TICKETING
PROVIDER FOR A SMALL HANDFUL OF
OTHER TEAMS OUTSIDE OF
CALIFORNIA. WE MUST STRESS THAT
ANY DISCUSSION OF THE CHALLENGES
PLAGUING LIVE INVENT EVENTS
ENTERTAINMENT MUST BE CENTERED
ON THE WELL DOCUMENTED
ANTICOMPETITIVE BEHAVIOR OF LIVE
NATION. TICKETMASTER LARGER
VENUES, HOSTING CONCERTS IN
CALIFORNIA AND BEYOND, DO NOT
CHOOSE FROM COMPETING TICKETING
PLATFORMS BASED ON THEIR
TECHNOLOGICAL CAPABILITIES OR
FAN FRIENDLINESS. THE
COMPETITION THAT SHOULD EXIST IN
AN OPEN AND FAIR MARKET, WHERE
COMPANIES CAN COMPETE FAIRLY FOR
TICKETING BUSINESS IS ON THE
MERITS SIMPLY DO NOT EXIST.
CALIFORNIA CONCEPT CONSUMERS
SUFFER AS A RESULT, WE WELCOME
AND APPRECIATE ALL EFFORTS IN
THIS SPACE AND LOOK FORWARD TO
WORKING WITH YOU ALL THIS YEAR.
THANK YOU. IMPRESSIVE, EXACTLY
TWO MINUTES. I WILL NOT BE
TAKING TWO MINUTES, BUT RYLANDER
ON BEHALF OF VIVID SEATS. WANT
TO THANK YOU VERY MUCH FOR THE
CONVERSATION TODAY AT VIVID
SEATS, THE FAN IS THE PRIORITY
AND ONE THING THAT WAS MADE
CLEAR TODAY AND OTHER SPECIES AS
WELL. IS THAT WHEN THERE IS A
COMPETITIVE MARKETPLACE, THE
FANS AND CONSUMERS COME OUT ON
TOP. THEY ARE EMPOWERED, AND IT
DRIVES INNOVATION. SO UM, WE
LOOK FORWARD TO CONTINUING THE
CONVERSATION AND HAPPY TO MEET
WITH YOU ALL TO DISCUSS OUR
PERSPECTIVE ON SOME OF THE
ISSUES RAISED TODAY, BUT THANK
YOU VERY MUCH. THANK YOU SO
MUCH. CHAIRS MEMBERS. THANK YOU
FOR TAKING THE TIME TODAY. MY
NAME IS CASE A LOT OF MILK AND
THE GENERAL MANAGER OF THE
BELLWETHER AND INDEPENDENT
CONCERT VENUE JUST WEST OF
DOWNTOWN LOS ANGELES. I'M HERE
TODAY TO ECHO AND SUPPORT THE
PERSPECTIVE OF JOE RINALDI AND
THE NATIONAL INDEPENDENT VENUE
ASSOCIATION. THE MOST
SIGNIFICANT CHALLENGES AS A
VENUE OPERATOR OR THE SECONDARY
MARKET AND DECEPTIVE, DECEPTIVE
WEBSITES. JUST LAST WEEK, I
ANSWERED A CALL TO OUR VENUE
FROM A GENTLEMAN WHO WAS LOOKING
TO BUY A TICKET TO AN UPCOMING
SHOW FOR HIS SON. HE WANTED TO
CONFIRM THAT THE $500 TICKET
PRICE HE SAW LISTED WAS
ACCURATE. IN REALITY, THE FACE
VALUE FOR THAT SHOW IS ONLY
$32.50, AND WE STILL HAD PLENTY
OF TICKETS FOR SALE. NOW THIS
CONSUMER WAS SAVVY ENOUGH TO
CALL US TO VERIFY. BUT EVERY
SHOW WE SEE PATRONS WHO UNKNOWN
UNKNOWINGLY PURCHASED TICKETS ON
THE SECONDARY PLATFORM THAT
WON'T SCAN AT OUR DOORS. WE HELP
THEM AS BEST AS WE CAN. BUT
CUSTOMER SERVICE FOR STUBHUB
VIVID SEATS AND OTHER SECONDARY
RESELLERS IS MINIMAL TO
NONEXISTENT DURING OUR HOURS.
THE SECONDARY MARKET HURTS OUR
REPUTATION IN THE COMMUNITY
IMPACTS OR EMERGENCE DUE TO
LOWER ATTENDANCE RATES AND KILLS
CONSUMER CONFIDENCE IN OUR
INDUSTRY. THANK YOU. THANK YOU.
CHAIRS AND MEMBERS OF THE
COMMITTEE. JULI BAKER, CEO OF
CALIFORNIA ARTS ADVOCATES, A C
FOUR ORGANIZATION, ADVANCING
POLICIES AND RESOURCES TO
SUPPORT THE ARTS, CULTURE AND
CREATIVE INDUSTRIES, WITH AN
EMPHASIS TODAY TO SPEAK ABOUT
THE NON PROFIT PERFORMING ARTS,
WHICH IN CALIFORNIA ALONE
REPRESENTS OVER 4000
ORGANIZATIONS EMPLOYING CLOSE TO
40,000 PEOPLE EARNING MORE THAN
$2 BILLION IN REVENUE EACH YEAR.
WHILE I APPRECIATED THE
EXCELLENT REPORT PREPARED BY
STAFF, JULIE GREAT JOB AND THE
HEARING TODAY. UNFORTUNATELY
NONPROFITS WERE LEFT OUT OF THE
CONVERSATION. THE ARTISTS,
VENUES AND AUDIENCES IN THE
NONPROFIT PERFORMING ARTS SECTOR
ALSO THREATENED BY PREDATORY
PRACTICES AND SECONDARY TICKET
SALES. RELIEF FROM PREDATORY
ACTIVITY ON THE SECONDARY MARKET
IS URGENTLY NEEDED. IT IS
IMPORTANT TO NOTE NONPROFITS DO
NOT HAVE THE SAME RESOURCES,
HUMAN FINANCIAL OR OTHERWISE AS
SOME FOR PROFITS, THEREFORE,
IMPLEMENTATION, IMPOSE A GREATER
BURDEN ON NONPROFITS AND TAKE
MORE TIME FUTURE LEGISLATIVE
EFFORTS ON THESE TOPICS NEED TO
CENTER NONPROFIT ARTS
PRESENTERS. IN THE BEGINNING OF
DRAFTING, THEY HAVE SPECIFIC
EXPERTISE, SPECIFIC CONCERNS AND
UNIQUE MISSION DRIVEN IMPACTS.
BUT THEIR TICKETING PRACTICES
ARE NECESSARILY DIVERSE AND
COMPLICATED IN WAYS THAT MAY NOT
BE IMMEDIATELY VISIBLE WITH
COMPLEXITIES ARISING FROM
EDUCATIONAL DISCOUNTS.
MEMBERSHIPS LEXICAL FLEXIBLE
SUBSCRIPTIONS THAT FLEXIBILITY
AND DIVERSITY OF PRACTICES
NECESSARY TO BEST SERVE
DIFFERENT AUDIENCES ART FORMS
AND IS NECESSARY FOR ARTS
NONPROFITS TO SURVIVE OUR
ORGANIZATION WELCOME THE
OPPORTUNITY WORK OF THE
COMMITTEES TO ADDRESS THE
SPECIFIC NEEDS AND CONCERNS OF A
NONPROFIT PERFORMING ARTS AND
URGED THE LEGISLATURE TO INCLUDE
NONPROFIT PERFORMING ARTS IN ANY
FUTURE TICKETING LEGISLATION,
PLANNING AND DESIGN. THANK YOU.
THANK YOU. THE BANK HAD IN
LIVERMORE CHANGED THAT DOWNTOWN
AND THEY ARE A NONPROFIT VENUE.
THANK YOU SO MUCH FOR HAVING US
TODAY. MY NAME IS JOHN DUNTON. I
AM THE GENERAL MANAGER OF A 500
CAP ROOM AND SAN FRANCISCO
CALLED THE INDEPENDENT AND ALSO
GOING TO BE THE GENERAL MANAGER
OF A 2300 CAP ROOM THAT WE'RE
BUILDING HERE IN SACRAMENTO NEAR
MIDTOWN. I'M HERE TO ECHO WHAT
JOE RINALDI SAID SO PERFECTLY. I
WISH JOE WOULD REPRESENT ME IN
ALL THINGS IN LIFE. UM I CAN'T
EMPHASIZE ENOUGH. WE REALLY I'VE
BEEN AT THE VENUE I'M AT FOR
ALMOST 20 YEARS. WE'RE
CELEBRATING OUR 20TH ANNIVERSARY
THIS NEXT WEEK. UH AND WE ARE
ECONOMIC AND CULTURAL DRIVERS OF
THESE NEIGHBORHOODS. AS AN
INDEPENDENT VENUE. WE ARE AT THE
GROUND LEVEL DIRECTLY
INTERFACING WITH CONSUMERS IN A
WAY THAT I DON'T THINK ANYBODY
ELSE IN THIS ROOM CAN SAY. I
KNOW THE PEOPLE THAT COME IN OUR
VENUE. I KNOW THEIR FACES. I
KNOW THEIR NAMES. I ACTUALLY DO
CARE ABOUT THEM, I SWEAR, AND IT
IS HURTFUL. AS JOE SAID, TO SEE
THIS CRISIS OF CONFIDENCE. I
CAN'T EMPHASIZE HOW MUCH HE'S
CORRECT THAT WE HAVE TO DEAL
WITH THIS ON A NIGHTLY BASIS.
FROM AN OPERATIONAL STANDPOINT,
IT'S A HEADACHE. IMAGINE LOADING
AN AIRPLANE AND THERE'S A BUNCH
OF FAKE TICKETS. FROM AS ALEX
MENTIONED. WE DON'T HAVE WHEN WE
HAVE A NO SHOW RATE, WE LOSE
MONEY. AND LASTLY, AS A BRAND.
IT ALL FALLS ON US. WHEN PEOPLE
ARE UPSET. THEY'RE UPSET WITH US
, AND WE GET THE BLAME FOR IT.
AND WE HAVE THE SMALLEST MARGINS
OF ANYBODY HERE. SO REALLY
AFFECTS US WHEN THAT CONFIDENCE
COMES DOWN ON US. SO THANK YOU
FOR HEARING US AND WE APPRECIATE
IT. THANK YOU. MADAM CHAIR, MR
CHAIRMAN, JAMES JACK HERE ON FOR
THE COALITION FOR TICKET
FAIRNESS AND, UM, THE TAYLOR
SWIFT SAGA, UM, WHICH HAS REALLY
CREATED I THINK A CRY FOR REFORM
IN THIS INDUSTRY. UM THAT IS A
WONDERFUL OUTCOME, BUT WHAT
OFTEN GETS OVERLOOKED? UM REALLY
? UNTIL MADAM CHAIR. YOU
DEFINITELY BROUGHT IT UP AT THE
END OF THE SECOND PANEL IS THAT
THERE ARE VERY FEW TAYLOR
SWIFTS, AS MR RINALDI SAID. FOR
EACH SHOW HE SELLS OUT. THERE
ARE FOUR THAT HE DOESN'T AND ONE
OF THE THINGS THAT THE SECONDARY
MARKETS BRINGS IS A VERY
PROFOUND PRO CONSUMER OUTCOME AS
WELL. AND THAT IS THE ABILITY TO
ATTEND EVENTS AND PAY LESS THAN
FACE VALUE FOR THOSE TICKETS ARE
COALITION COMMISSION TO STUDY
LAST YEAR TO TRY AND QUANTIFY
THIS AND FOUND THAT THE
SECONDARY MARKET WAS RESPONSIBLE
FOR 7 MILLION TICKETS. SOLD
NATIONWIDE AT BELOW FACE VALUE.
UM AND SO THAT REALLY IS VERY
PROFOUNDLY PRO CONSUMER AND THE
SINGLE LARGEST STATE. UM TO
ENJOY THAT BENEFIT WAS
CALIFORNIA JUST UNDER A MILLION
OF THOSE TICKETS WERE FOR
SPORTING EVENTS AND CONCERTS AND
THEATER EVENTS HERE. UM SO THANK
YOU, UH, FOR THIS HEARING TODAY
AND FOR ALSO PAYING CLOSE
ATTENTION TO THAT OTHER
IMPORTANT SIDE OF THE EQUATION.
THANK YOU. THANK YOU. HE DIDN'T
SAY HOW MANY OF THOSE WORRIES
TICKETS, MADAM CHAIR AND MEMBERS
. MY NAME IS JIM PERNET. I AM
THE OWNER AND OPERATOR CARLOS,
THE STARLET ROOM AND CAFE
COLONIAL HERE IN SACRAMENTO.
I'VE BEEN OPERATING LIVE UNDER
10 ENTERTAINMENT VENUES FOR OVER
32 YEARS HAVE BEEN RESPONSIBLE
FOR OVER 10,000 SHOWS. AND I
HAVE NOT SEEN ANY ANY OF THESE
TYPES OF TICKETS. THESE ISSUES.
IN THE PAST UNTIL THE LAST FEW
YEARS. GERMAN ALI COVER THE CRUX
OF OUR PROBLEMS THAT WE'RE
HAVING AT OUR FRONT DOOR DEALING
WITH THEIR PATRONS. THEY SAID
THAT TO PRACTICE HURTS OUR BRAND
TAKES MONEY OUT OF HER POCKET.
OUR PATRONS ENTERTAINMENT BUDGET
THAT COULD BE SPENT ON IT, UH,
ATTENDING OTHER SHOWS. AND IT'S
JUST OUTRIGHT. UH FRUSTRATING TO
DEAL WITH ON A FACE TO FACE
BASIS, AND YOU DEAL WITH
CUSTOMERS THAT COME UP THAT HAVE
EXPECTATIONS THAT YOU CAN'T
MEET. AND YOU HAVE TO TURN THEM
AWAY, AND IT'S VERY
DISHEARTENING AND IT AFFECTS OUR
BRAND AND THANK YOU FOR YOUR
TIME. THANK YOU. HI JOSH
LIEBERMAN. I'M THE GENERAL
MANAGER OF AUGUST HALL, WHICH IS
850 CAP ROOM AND DOWNTOWN SAN
FRANCISCO. UM I THINK JOE SAID
IT PRETTY WELL. BUT ONE THING I
WOULD LIKE TO ADD, IS THAT UM, I
DON'T THINK THERE SHOULD BE A
LITERACY REQUIREMENT FOR BEING
ABLE TO PURCHASE A TICKET AND
UNFORTUNATELY THAT IS THE
ENVIRONMENT THAT WE FIND
OURSELVES IN WHERE ANYONE WHO IS
NOT SAVVY ENOUGH TO CUT THROUGH
THE NOISE IS JUST FINDING
THEMSELVES BEING TAKEN ADVANTAGE
OF. WE HAD INTERNATIONAL ARTIST
A FEW WEEKS AGO. I SPENT 40
MINUTES LEARNING HOW TO USE
GOOGLE TRANSLATE TO FIND OUT
THAT SHE HAD BOUGHT 100 AND $50
TICKET FOR A $20 TICKET THAT WE
WERE SELLING, UM, AND WAS ABLE
TO, YOU KNOW, ESSENTIALLY COMPRA
TICKETS ISSUED ATTEND, BUT SHE
HAD TO FIGHT IT WITH HER CREDIT
CARD. AND WE HAVE NO RECOURSE
THAT YOU KNOW OUR CUSTOMER IS
GOING TO BE ABLE TO GET THEIR
MONEY BACK. UM JUST FROM CHEWING
SOME BASIC GOOGLE SEARCHING THE
OTHER DAY. THERE ARE 27 RESULTS
THAT COME UP BEFORE MY VENUE FOR
FRAUDULENT WEBSITES OR
FRAUDULENT TICKETS THAT ARE 3 TO
4 TIMES ABOVE. YOU KNOW WHAT OUR
BASE LEVEL IS SOLD AT THAT OFFER
SEATING THAT WE DON'T HAVE THAT
OFFER VIP PACKAGES MEET AND
GREETS THAT ARE ARE NOT THERE.
UM AND YOU KNOW, I THINK THERE
ARE A LOT OF ELOQUENT POINTS
MADE BY EVERYONE. THE FACT THAT
TICKETMASTER IS ALSO
ENCOUNTERING THESE ISSUES. KIND
OF SPEAKS TO THE BREADTH OF THIS
PROBLEM. BUT YOU KNOW FOR FOLKS
THAT DON'T HAVE THOSE SAME KIND
OF RESOURCES. WE ARE ALL FINDING
OURSELVES ON THE ROPES, TRYING
TO FIGURE OUT HOW TO OPERATE IN
AN ENVIRONMENT LIKE THIS, AND
YOU KNOW, I HAVEN'T BEEN ABLE TO
THINK OF AN ANALOGOUS REFERENCE.
WE HAVE BEEN ABLE TO REALLY FIND
ONE FOR, YOU KNOW, TRYING TO BUY
GROCERIES AT SAFEWAY AND ENDING
UP ON A FRAUDULENT WEBSITE. UM
BUT TO USE THE IPHONE ONE FROM
EARLIER IT WOULD BE LIKE
PURCHASING AN IPHONE AND THEN
SHOWING UP AND GETTING A
SIDEKICK, WHICH I DON'T THINK
ANYONE WOULD BE VERY EXCITED
ABOUT. UM BUT THANK YOU FOR YOUR
TIME AND ATTENTION IN THIS AND
WE APPRECIATE IT. THANK YOU.
GOOD AFTERNOON, EVERYONE. I'M
DANIEL. ROMAN DEAR. I AM I'M THE
MARKETING DIRECTOR AND A TALENT
BUYER WITH CARLOS IN THE
STARLIGHT ROOM HERE IN
SACRAMENTO ALONG IS BEING CO
OWNER WITH JIM OF CATHOLIC
COLONIAL ALSO HERE, UM AND I
CAME HERE WITH THE PREPARED
STORY THAT I WAS GOING TO TELL
YOU UNTIL LAST NIGHT. BECAUSE
LAST NIGHT WE HAD A SOLD OUT
SHOW AT CARLO'S. UM AND YOU KNOW
WE ARE EXPECTING A FULL HOUSE.
WE WERE EXPECTING A VERY BUSY
BALLROOM RESPECTING BE ALL HANDS
ON DECK. NEARLY 100. PEOPLE DID
NOT SHOW UP. AND THEN ALONG WITH
THAT I GET TO THE VENUE MAYBE
HALF HOUR AFTER DOORS OPEN, AND
MY BOX OFFICE ATTENDANT IS
DEALING WITH SOMEONE WHO DOES
NOT HAVE TICKETS THAT ARE ABLE
TO BE SCANNED BECAUSE THEY
BOUGHT THEM FROM VIVID SEATS AND
ONLY RECEIVED ONE OF THE FOUR
THEY PURCHASED. SO I TOOK THEM
OUTSIDE. I TALKED TO THEM. I
EXPLAINED EVERYTHING THAT'S
GOING ON WITH JUST ALL SORTS OF
RESALE TICKETS, ALL SORTS OF
FRAUDULENT SITES, ALL SORTS OF
LIKE SITES THAT ARE ESSENTIALLY
PRETENDING TO BE US. BECAUSE THE
AVERAGE TICKET BUYER DOES NOT
KNOW TO GO TO HARLEM. THEY DON'T
KNOW TO GO TO OUR TICKETING
PROVIDER ETIX. THEY KNOW TO GO
TO GOOGLE AND LOOK UP THE SHOW.
THEY WANT TO SEE AND CARLOS AND
THEY CLICK THOSE FIRST LINKS. UM
WE WERE LUCKY THAT WE WERE ABLE
TO FIND TICKETS THAT PEOPLE
WEREN'T USING THAT NIGHT AND WE
GOT THEM INTO THE SHOW. BUT OUR
INVENTORY DID NOT HAVE IT.
INITIALLY WE HAD TO FIND IT. AND
SO IT ENDED UP BEING A GOOD
STORY IN THE END, BUT IT'S
SOMETHING THAT WE ENCOUNTER
EVERY SINGLE DAY. UM AND IT'S
JUST HURTS OUR BUSINESS. AND IT
BRINGS US TRUE HEADACHES THAT WE
DON'T NEED ON TOP OF ALREADY
HAVING A SOLD OUT SHOW. UM SO
THAT'S PART OF PROBLEM OR
SOMETHING. THANK YOU VERY MUCH.
CHAIRS MEMBERS. THANK YOU FOR
HAVING US TODAY. MY NAME IS
GABRIEL DOKDO. I'M ALSO AUGUST
HALL IN SAN FRANCISCO, AS WELL
AS A MEMBER OF NIVEA AND SAN
FRANCISCO VENUE COALITION. UM I
CAME HERE TODAY TO THANK YOU FOR
HAVING THIS HEARING. I THINK AS
SOMEONE WHO'S PERSONALLY WRITTEN
SOME OF THE OPPOSITION TOWARDS
SOME OF THE LEGISLATION THAT'S
COME OUT THE THOUGHTFULNESS
BEHIND CONDUCTING THIS HEARING.
IS APPRECIATED. THERE'S A LOT OF
NUANCE AS YOU GUYS HAVE HEARD
OVER THE LAST COUPLE OF HOURS.
UM, AND ADDITION TO ADVOCATING
FOR SOME OF THIS LEGISLATION ON
THE FEDERAL SIDE, I WOULD ALSO
ENCOURAGE A LOT OF THIS
DISCOVERY TO KEEP ON HAPPENING
AS MORE LEGISLATION GETS WRITTEN
, UM, WE WOULD LOVE TO CONTINUE
TO HAVE THESE CONVERSATIONS
EITHER IN HEARINGS OR MEETING
ROOMS IN ORDER TO MAKE SURE THAT
THIS LEGISLATION IS THOUGHTFULLY
DRAWN OUT TO HELP PREVENT
EVERYTHING THAT YOU'VE HEARD
TODAY, AS WELL AS NAVIGATE A LOT
OF THE NUANCES. UM THAT EXISTS
SOME OF WHICH WEREN'T VOICE BUT
MANY OF THEM THAT WERE, UM SO
THANK YOU VERY MUCH. AND WE LOOK
FORWARD TO CONTINUING THIS WORK.
THANK YOU. GOOD AFTERNOON SHARE
AND MEMBER. I COULD ONLY FIND
REBECCA MARCUS AND I CAN ONLY
DREAM TO BE AS COOL TO OWN MY
OWN MUSIC VENUES. SO INSTEAD,
I'M AN ADVOCATE REPRESENTING
HELPER, WHICH IS A STATEWIDE
CONSUMER WATCHDOG AND AGASSI
GROUP WORKING TO PROTECT
CALIFORNIANS TO ENSURE A FAIR
MARKETPLACE WERE ALSO THE
SPONSORS OF CO SPONSORS OF MS
FRIEDMAN'S 88. WE WANT TO THANK
THE COMMITTEE FOR INVESTIGATING
PROBLEMS WITH THE TICKETING
INDUSTRY AND CONSIDERING ALL
REFORMS TO MAKE THE TICKET PLACE
MARKETPLACE MORE FAIR TO
CONSUMERS FOR A MARKETPLACE TO
WORK EFFECTIVELY. WE NEED
TRANSPARENCY AND CONTROL. WE
NEED TO KNOW CONSUMERS NEED TO
KNOW WHAT THEY'RE PAYING FOR,
AND HOW MUCH UPFRONT IN ORDER TO
MAKE INFORMED PURCHASES. YET
TICKET SELLERS HAVE GOTTEN AWAY
WITH, INCLUDING HIDDEN FEES AND
CLEAR SEAT LOCATION, INFORMATION
AND MURKY REFUND POLICIES. WE
AGREE WITH MISS DOOLEY,
CONSUMERS SHOULD KNOW HOW MANY
TICKETS ARE ACTUALLY AVAILABLE
FOR PURCHASE. AND WHEN THEY WILL
BE SOLD, AS WAS DISCUSSED TO GET
SELLERS HAVE BEEN KNOWN TO HOLD
BACK THESE TICKETS, WHICH CAN
ARTIFICIALLY INFLATE THE PRICES.
IN ADDITION TO PROPER
TRANSPARENCY. CONSUMERS ALSO
DESERVE CONTROL OVER THEIR
TICKET AFTER THEY PURCHASE IT IF
THEY SHOULD BE ABLE TO DECIDE
HOW TO USE IT, SELL OR GIVE AWAY
THEIR TICKETS IF THEY WISH.
UNFORTUNATELY MANY TICKET
SELLERS CURRENTLY CAN PREVENT
TICKET OWNERS FROM RESELLING
THESE TICKETS. THROUGH ANY WEB
SITE THAT THEY CHOOSE. ONCE THEY
BUY A TICKET. IT SHOULD BE YOURS
TO DO WITH ACTUALLY PLAYS. WE
CAN LOOK FORWARD TO CONTINUE
WORKING WITH THE COMMITTEE.
THANK YOU. THANK YOU. LAST TIME,
AT LEAST. HI MY NAME IS JESSICA.
HER BOUTS AND I'M A LATINO
PROMOTER. I DO CONCERTS ALL OVER
THE UNITED STATES AND BASED IN
CALIFORNIA, I MOVED HERE WHEN I
WAS IN THE 123 YEARS AGO WHEN I
WAS 14 AND I'VE BEEN IN
CALIFORNIA EVER SINCE IN A DAY,
AND I'M THE SECRETARY FOR NIVA
FOR THE NATIONAL INDEPENDENT
VENUES AND PROMOTE YOUR
ASSOCIATION. AND ONE OF THE MAIN
THINGS THAT I'VE SEEN WITH THE
WITH THE TICKET IN RIGHT NOW
THAT IT'S AFFECTING A LOT, THE
HISPANIC COMMUNITY AS WELL, THE
LATINO COMMUNITY, THE LATINO
COMMUNITY IN UNITED STATES IS
THE FIVE LARGEST ECONOMY, SO
THEY MOVE A LOT OF THE ECONOMY
THROUGHOUT THE WAR, AND ONE OF
THE MAIN THINGS IS AN THEY AND
THE LANGUAGE BARRIER. SOMETIMES
ON THE WEBSITE IS NOT A SPECIFIC
TO THEM AND OF WHAT THEY'RE
BUYING OR WHERE THEY ARE BUYING.
THE OTHER DAY I WAS DRIVING AND
I HIT ON THE RADIO 714 TICKETS
ON THE LATINA LATINO, VERY WELL
KNOWN LATINO RADIO STATION 714
TICKETS, HEALTHIER TICKET FOR
ANY EVENT, SPORTS AND CONCEPTS.
ANYTHING SO THAT MEANS THAT
PEOPLE THAT ARE LISTENING TO A
RADIO INSTEAD OF IN ON THE
INTERNET AND PEOPLE THAT THEY
DON'T SOME SOME OF THOSE PEOPLE
THEY DIDN'T FINISH THEIR
EDUCATION. THEY GO? OH, I
LISTENED ON THE RADIO, SO IT
MUST BE REAL. SO THEY GO AND BUY
TICKETS THAT THEY DON'T EVEN
HAVE AND THEN IN WHEN, WHEN I
CLOSED THE TOURS WITH THE
ARTISTS, AND WE NEVER KNOW HOW
MANY PEOPLE ARE GOING TO SHOW UP
BECAUSE A LOT OF THE PEOPLE A
LOT OF THE PEOPLE ARE NOT.
CERTAIN THAT THEY'RE BUYING THE
RIGHT TICKET. SO SOMETIMES YOU
HAVE 300 TICKETS, PRE SALE AND
THEN YOU HAVE 900. PEOPLE SHOW
UP. SO YOU'RE YOU'RE NEVER READY
TO WHAT YOU'RE GOING TO EXPECT
THE NIGHT OFF, AND THEN ALSO,
THIS BRINGS A LOT OF PROBLEMS
WITH THE ARTISTS BECAUSE ON MY
EXPERIENCE IS NOT TRUE THAT THE
ARTISTS PUT THE PRICE FOR THEIR
PRICE FOR THE TICKET PRICE. YOU
BUY THE SHOW AND THEN ACCORDING
TO YOUR EXPENSES YOU DO AND
SCALING OF HOW MUCH YOU SHOULD
CHARGE FOR THE TICKET. SO I HAVE
MANY CALLS FROM ARTISTS THAT
THEY BOUGHT THE WHOLE TOUR AND
THEY GO. HEY, JESSICA, WHY AM I
WHY AM SAYING WHY ARE YOU
SELLING THE TICKET FOR 501? OUR
TOPICS. PRICE WAS $75. SO THOSE
ARE DIFFERENT EXPERIENCES THAT
WE'VE BEEN HAVING ON THE LATINO
SIDE. THERE'S ABOUT 8% OF THE
SHOWS IN UNITED STATES THAT ARE
ON THE FROM THE LATINO COMMUNITY
AND ALSO AND PERSONAL EXPERIENCE
. IT WAS MY MOM LAST WEEK, SHE
WANTED TO GO TO A FLAMINGO SHOW
SHE BEING HERE FOR 23 YEARS. SHE
DOESN'T SPEAK ENGLISH THAT WELL,
SHE SAID. U S CITIZEN BUT STILL
SHE DOESN'T SPEAK ENGLISH THAT
WENT SO SHE WANTED TO GO TO A
FLAMINGO SHOW, AND SHE CALLED ME
BECAUSE SHE KNOWS THAT ALL THIS
TICKET THINGS ARE GOING ON. AND
SHE GOES. HEY CAN YOU HELP ME
BUY THE TICKETS? BECAUSE I DON'T
KNOW IF I'M GONNA BE LIKE IF
THEY'RE REAL TICKETS, OR SHOULD
I JUST GO TO THE DOOR AND MAKE
SURE THAT THE REAL TICKETS SO
IT'S I KNOW THIS IS A THING THAT
IS AFFECTING EVERYBODY. THANK
YOU. THANK YOU SO MUCH. I REALLY
WANT TO THANK ALL THE MEMBERS OF
THE PUBLIC THAT TOOK YOUR TIME
TO BE WITH US TODAY. THIS WAS
SUCH AN IMPORTANT CONVERSATION
AND EVERY PERSPECTIVE WE HEARD
WAS CRITICAL AND I WANT TO
REITERATE THE GRATITUDE TO THE
STAFF AND SPECIFICALLY TO JULIE,
WHO HAS SPENT MORE HOURS ON THIS
THAN YOU CAN EVEN IMAGINE IT,
BUT IT DEFINITELY SHOWED THROUGH
HER ANALYSIS, SO I KNOW WE HAVE
A LOT OF WORK AHEAD OF US BOTH
ME AND MR CHAIR AND WE LOOK
FORWARD TO CONTINUING TO WORK
WITH ALL OF YOU TO FIND THE
RIGHT SOLUTION FOR CALIFORNIA
CONSUMERS CLOSING WORK. OH THANK
YOU VERY MUCH. MADAM CHAIR JUST
WANTED TO THANK ALL THOSE WHO
WAS ON THE PANEL AS WELL AS
THOSE WHO GAVE YOUR PERSONAL
TESTIMONIES THROUGH YOUR
PERSONAL JOURNEY AND LENS. UM,
AS I SAID, BEFORE, IT HAS GIVEN
US A LOT OF FRUITFUL THOUGHT, UM
, I APPRECIATE THE VERY ROBUST
CONVERSATION AND CERTAINLY, UM,
I LOOK FORWARD AS THE CHAIR OF
THE ARTS, ENTERTAINMENT, SPORTS
AND TOURISM COMMITTEE. TO WORK
WITH THE CHAIR OF PRIVACY TO TRY
TO FIND REAL SOLUTIONS, AND I
WOULD JUST SIMPLY UNDERSCORE
THIS AS I CONCLUDE MY THOUGHTS
IF YOU HAVE THOSE SUGGESTIONS
AND WRITING, I WOULD INVITE YOU
TO PLEASE, UM SUBMIT THOSE. UM
SUGGESTIONS, UM TO OUR OFFICE SO
THAT WE CAN LOOK AT THOSE
SUGGESTIONS AND TRY TO FIGURE
OUT WHAT WE WHAT WE CAN DO IN
THIS LEGISLATIVE SESSION NOW
BECAUSE I THINK IT'S A VERY,
VERY IMPORTANT THAT WE HAVE A
BALANCED APPROACH TO SOLVING
THIS MAJOR ISSUE. I JUST WANT TO
PUT PEOPLE IN. WELL, LET ME NOT
SAY THAT I WANT TO ADDRESS THE
ISSUE OF TRYING TO PUT THAT, UH,
INDUSTRY. UM UM, THAT HAS TAKEN
ADVANTAGE OF PEOPLE. AH UM AND
ADDRESS THAT PARTICULAR ISSUE
BECAUSE AGAIN LISTENING TO THE
STORIES AND PEOPLE WORK HARD AND
SAVE MONEY TO GO TO THESE SHOWS
TO SUPPORT THESE ARTISTS AND
THEN AT THE END TO KNOW FATHER
OAN GOING TO A WEBSITE THAT
THEY BELIEVE THEY CAN TRUST AND
THEN LOSING. THOSE RESOURCES IN
WHICH THEY'VE SAVED OR THE OWNER
OF THAT VENUE, MAYBE INDEPENDENT
VENUE. UM AND YOU SELL OUT THAT
YOU FIND OUT YOU REALLY DIDN'T
SELL OUT. UM AND YOU'VE STAFF
BASED ON WHAT YOU BELIEVE. UM UM
, IS PROJECTING FOR THAT
PARTICULAR NIGHT AND THEN HAVING
TO SEND PEOPLE HOME OR LAY
PEOPLE OFF TO MAKE A BOTTOM LINE
TO KEEP THE LIGHTS ON. THAT'S
DISHEARTENING TO ME, AND WE WANT
TO TRY TO FIND REAL SOLUTIONS TO
THESE PARTICULAR PROBLEMS. THE
SITUATION SO I INVITE YOU TO
PLEASE HELP US IN THIS PROCESS
BY SUBMITTING THIS INFORMATION,
UM, TO BOTH OUR OFFICES SO WE
CAN LOOK AND FIGURE OUT UM
WHAT'S THERE AND WHAT WE CAN DO
IN THIS? LEGISLATIVE SESSION. SO
I THANK YOU ALL FOR COMING. AND
WITH THAT WILL BE ADJOURNED.
THANK YOU. ALL RIGHT.