Local Ticket Providers Challenge Goliath

Two Edmonton companies – one private, one public – fight for a slice of the ticket-providing market controlled by Ticketmaster.

The world has changed since those days when you wandered over to the Coliseum box office to buy a ticket, to bang your head along with Black Sabbath or watch Mark Messier wreak havoc on the ice, without paying for the privilege of buying a ticket. Selling tickets – the paper to the event, not the event itself – has turned into a multi-billion dollar industry, one encased in controversy that’s plugged right into the technologies that have changed its nature.

But local arts enthusiasts and entrepreneurs are trying to change it again, even though their competition, Ticketmaster and its multiple personalities, dominate the global ticketing business and has billions of dollars at its disposal. Its grip has never been stronger since it was folded into Live Nation, the world’s largest concert promoter, in 2010, which sealed the deal on its monopoly on large-venue shows throughout North America.

But in the small pond that is Edmonton’s entertainment industry, two minnows have managed to swim with the whale, with much smaller service charges. They are YEG Live, which gained a foothold over the past two years with canny use of Internet, social media and smart phones, and Tix on the Square,  a subsidized offshoot of the Edmonton Arts Council that’s more like the traditional box office. Both claim their primary aims are to promote the city’s arts.

Tix started in 1997 as a vehicle to sell last-minute rush tickets; it evolved into an agency that sells thousands of tickets monthly to plays and concerts. It has run deficits as high as $13,000 in recent years with these shortfalls subsidized by the Edmonton Arts Council. But as John Mahon, executive director of the arts council says: “We’re like a non-profit. We pay our staff reasonably and we don’t charge a lot for the service. We’re here to support the community, not to make a buck.”

YEG Live, however, sees itself more as a private start-up and, in fact, its smart phone app, which lets users prowl for and buy tickets to local shows, won top prize at the city’s 2010 Apps4Edmonton competition.

For $1.99 surcharge per ticket sold, it manages to pay its bills, make a modest profit and provide useful technological convenience features, while maintaining accurate online listings of live music in Edmonton. “Our approach is to increase the demand [for music], to remove barriers, make it more accessible and provide an alternative from the competition,” says co-founder Chris Martyniuk.

YEG Live has also kept the price low to increase its volume, and to do its bit in making music accessible. Unlike Ticketmaster, which has a sliding scale for its fees depending on the face value of the ticket, YEG Live has the same $1.99 fee for all tickets it processes. As Martyniuk says, it costs no more to process a $30 ticket than a $100 ticket.

Tix service charges are in the same ballpark, ranging from $1 for a ticket under $10 to $5 for a table of eight at a fundraiser.

Mahon says there’s room in Edmonton for a number of local ticket sellers. “We’re not competing at all. We’re in the business of helping people go to shows, and so are the others.”

The roots of YEG Live go back in 2007 when Martyniuk and partner Cameron Gertz ran Hulbert’s, a south side restaurant that became a venue for roots music. Martyniuk, who already had sixteen years of IT experience, used the web to promote the concerts, building a database of performers, running webcasts of concerts and creating a website for U22 Productions, a collective of young Canadian musicians.

They found that musicians and small venues, which generally don’t have much of an advertising budget, weren’t well served by the listings in local publications, which weren’t always accurate. Gertz says that one of the streeters continued to list Hulbert’s weekly open stage for 13 months after the venue closed late 2009.

That’s when they decided to start their own music listings service and called it YEG Live.

“We wanted to get the accuracy of the movie listings and TV listings,” Gertz says. “We don’t just publish what comes to us, but we check it out. We take a journalistic approach rather than just regurgitation.” If a venue they haven’t heard of submits a listing, they try to verify it, and don’t automatically publish it to the website until it has achieved a certain level of trust.

The ticketing part of the business followed naturally. They needed a revenue generator to keep going, and it was relatively easy to link listings with ticket sales. From running Hulbert’s they knew that advance ticketing can make a big difference to a small venue, especially in staffing decisions, but it could also be expensive to set up a ticketing system.

They decided to go into e-ticketing with no phone sales (although paper tickets are available at Blackbyrd Myoozik, a local record store). And, very early on, Martyniuk made an even smarter decision to base the system around smart phones.

“When we were going into e-ticketing, we realized that 80 per cent of new phones were going to be smart phones,” Martyniuk says. “We saw the writing on the wall and said this is the way we need to go. I started on the technical side, and we built the system.”

They offer a totally paperless service for those with smart phones, and one of the few systems where users can pay with Interac as well as credit cards and PayPal. And, if you’re buying tickets for several people, you can forward the emails to them and they can be admitted separately to the venue. The venue has no need for expensive scanners: The code is scanned with a camera-phone app, so essentially ticket-takers just need another smart phone.

Unlike YEG Live, Tix takes phone orders and  maintains an outlet in Churchill Square, which it shares with Ticketmaster (it also doubles as a gift shop, promoting the work of local artists).

Mahon says the outlet still plays an important social role, in which people can ask questions about events. Last year Tix sold more than $1 million worth of tickets to plays and other events, including classical music concerts outside of the Winspear, which has its own box office.

Since February 2010, YEG Live ticketing has been picked up by numerous venues around the city, such as the Haven Social Club, Pawnshop, Varscona Theatre and more. Martyniuk says YEG Live has often avoided setting up exclusive contracts with venues because “I want our clients to fire us if they need to, but I want to work hard so they don’t feel that need.”

Concert promoter Steve Derpack of JCL Productions has dealt with Ticketmaster and Calgary-based Prime Box Office, a new Alberta player that has a deal with the Starlite Room. But he now sends his ticket business to YEG Live whenever possible. He says the start-up is very supportive of local music, and its technological savvy makes his job, to promote, easy. And, he adds, “the less they [customers] pay in ticket charges, the more they can spend on merch and at the bar.”

YEG Live’s ambitions extend beyond Edmonton. It has served as the ticket seller for artists such as Hey Rosetta!, cult film director Kevin Smith and Sam Roberts for non-Ticketmaster venues in eastern Canada, and it’s looking at Calgary and Vancouver to set up similar services. In fact, the company has reserved domain names for YYC Live and YVR Live, “just in case,” Martyniuk says. “It’s in the plans. It’s just a matter of when we execute it.”

The Competition

The ubiquitous Ticketmaster has been the focus of anger from civilians and rock stars alike. In 1994, Pearl Jam went to the U.S. Congress to speak out against the concert giant after the band’s attempts to schedule a major tour without Ticketmaster turned into a series of cancelled shows.

The corporation has a lock on selling tickets at most major venues, and many smaller venues, around the world. In fact it’s bigger than ever, especially after being bought out by Live Nation, which books tours of major artists and had revenues of $5 billion in 2010.

In the end, the consumer pays. For the “convenience” of purchasing a ticket to the recent Nickelback concert, for instance, a $99 ticket ended up costing $117, with $17.50 going to Ticketmaster and another 50 cents going to Northlands in the form of a “facility fee.”

Venues big and small, from Commonwealth Stadium to Edmonton Events Centre to Century Casino’s The Venue, have exclusive contracts marrying their seats to Ticketmaster.

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