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Book Excerpt: Ticket Masters (The String Cheese Incident vs.Ticketmaster)

The String Cheese Incident recently announced that they would be selling service fee free tickets to shows on their upcoming summer tour. As an article in yesterday’s New York Times detailed, the group was able to accomplish this by advancing money to fans who purchased tickets without service charges at box offices and then handed them over them to SCI for resale. This is the realization of a plan that the group first contemplated nearly a decade ago after Ticketmaster announced it would limit the number of seats that the group could sell through its own ticketing service. The conflict resulted in a lawsuit that the String Cheese Incident filed against Ticketmaster in 2003 that ultimately resulted in an out of court settlement in the group’s favor.

The book Ticket Masters: The Rise of the Concert Industry and How the Public Got Scalped by Dean Budnick and Josh Baron, devotes an entire chapter to this event. An excerpt from that chapter appears below. A new expanded paperback edition of Ticket Masters has just been published. To learn more, visit Ticketmastersthebook.com.

From Chapter 9 of Ticket Masters : A Quiet Victory

In May 2002 Ticketmaster sent letters to venues and promoters with whom it had exclusive agreements. The letter stated that Ticketmaster would no longer allow them to provide direct artist-to-fan ticketing with the historical allocations that they previously had been given. Only “legitimate” fan clubs would be allowed an allocation, and to qualify as legitimate, four requirements had to be met: (1) members must pay at least $15 per year; (2) no more than four tickets can be purchased by a member for a performance; (3) tickets are not allowed to be resold; and (4) there must “meaningful” interaction between the band and fans.

The new requirements didn’t sit well with a band like the String Cheese Incident.

“Our argument, in terms of precedent, was that Grateful Dead were able to do it through mail order since the beginning of time,” offers manager Mike Luba. “We would sit in meetings with Terry Barnes, the chairman of Ticketmaster, who is actually a really decent guy, and I would say to him, ‘Terry, all we were doing was ripping off the idea the Dead had with mail order. It’s just an e-mail order. That’s all it is. You already set the precedent. What’s the big difference?’ That was a very scary argument to them.”

Ticketmaster’s CEO at the time, John Pleasants saw String Cheese as “waving the flag that there’s this evil company that won’t let us sell our tickets; they’re our tickets,” he reflects now. “Basically, you’re getting at this emotional issue, which is who owns the ticket? The artist thinks they own the ticket, the building thinks they own the ticket and the ticket actually sits in Ticketmaster’s system.” But the fact remained—and remains—that an artist does not own the tickets inside a venue it’s playing.

Riffing, Pleasants throws out a hypothetical example: “String Cheese struck a deal through their promoter to play in the building, and the inventory is owned by the Pepsi Center, and the Pepsi Center has contractually given it to Ticketmaster. [The band] can raise as much hell as they want to [about receiving their desired ticket allotment]. They’re just breaking the law when they do it.”

Madison House and the String Cheese Incident were offered what was deemed a viable alternative by Ticketmaster and Clear Channel, the ticketer’s biggest client and the country’s largest promoter. If the band hired Coran Capshaw’s MusicToday—which Clear Channel had a financial stake in via its SFX purchase—to handle its artist-to-fan ticketing, the “legitimate fan club” requirements would be waived and the band would get a twenty-five percent larger ticket allocation. They passed.

Instead String Cheese Incident played very few Clear Channel or Ticketmaster-operated venues in 2002. “I do remember the conversations of, ‘Hey, we may be shut out of some of these venues that we want to play if we go this route and decide to fight them,’” recalls the group’s Moseley. “We are going to have to look at playing alternative venues. Actually we did some of that. The talk was, ‘Is that going to be worth it? Is the fan base going to respond favorably to the fact that we’re trying to take on Ticketmaster and we’re consequently in different kinds of venues than they’re used to? Or would the fan base rather see us in the regular venues and go through Ticketmaster to get their tickets? We felt like the fan base was behind us. It didn’t matter where we played.”

And when the band did play a Ticketmaster venue, they had developed a rather creative way to secure—or ensure, depending on how you looked at it—their desired ticket allotment.