TicketMaster and the Market Value of Tickets

November 2nd, 2009, 3 Comments »

Over the summer, I read a great article in The New Yorker about TicketMaster, Live Nation and the history of rock concert promotions. It was unavailable online until somebody kindly added it to this Reddit discussion thread in which I was involved. You can view a PDF of the article here, or I’ve also uploaded it here.

It’s a pretty fascinating article, and reveals some surprising (to me, at least) facts about the concert business. One is that TicketMaster and Live Nation have struggled, financially, and lose huge chunks of revenue due to scalping. Another is that, of course, many concert tickets are radically under-priced. From the article:

The phenomenon of below-market value tickets has inspired a cottage industry of economists seeking to explain seemingly illogical pricing in the rock-concert business. Alan Krueger…an economist…is one. “There is still an element of rock concerts that is more like a party than a commodities market,” Kruger told me. A ticket to a rock show, he said, bears elements of a “gift exchange,” in which intangible benefits accrue for the seller. Cheap tickets increase the possibility of a sellout, which augments merchandise and concession sales. Sellouts make the concert experience better for the musicians and audience alike. And, one might add, a cheap ticket is the price the music industry pays to preserve the illusion that the sixties never ended. “In some fashion, I help people hold on to their own humanity–if I’m doing my job right,” Springsteen once said, of his performances. At least, he helps people hold on to their savings.

That’s kind of a provocative idea, isn’t it? While we (myself included) complain about the high cost of concert tickets, they’re actually priced well below market value. This applies much more for the Springsteens and the Madonnas than local bands, obviously, but the former is where TicketMaster and Live Nation make all their money.

I don’t in any way mean to be an apologist for TicketMaster. Their business model is built on controlling the marketplace and delivering shockingly little added value to their customers. It’s only getting easier for venues to handle their own ticket sales. So, it’s my hope that TicketMaster may die off with the generation of rock and rollers they depended upon for their revenue.

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Why Do So Many Evangelical Teens Become Pregnant?

November 3rd, 2008, 2 Comments »

I recently read this fascinating article in The New Yorker about religion and teen pregnancy and sexuality trends in the US:

Regnerus argues that religion is a good indicator of attitudes toward sex, but a poor one of sexual behavior, and that this gap is especially wide among teen-agers who identify themselves as evangelical. The vast majority of white evangelical adolescents—seventy-four per cent—say that they believe in abstaining from sex before marriage. (Only half of mainline Protestants, and a quarter of Jews, say that they believe in abstinence.)

A few interesting factoids that I took away from the piece: the states with the highest divorce and teen pregnancy rates in the country are all red states, and the ones with the lowest are mostly blue. It might be useful to map those states to per-capita income, to reflect how teen pregnancy pertains to income, not just political allegiance.

Even more interesting was that there’s a kind of tipping point for celibacy pacts in high school populations:

Bearman and Brückner have also identified a peculiar dilemma: in some schools, if too many teens pledge, the effort basically collapses. Pledgers apparently gather strength from the sense that they are an embattled minority; once their numbers exceed thirty per cent, and proclaimed chastity becomes the norm, that special identity is lost. With such a fragile formula, it’s hard to imagine how educators can ever get it right: once the self-proclaimed virgin clique hits the thirty-one-per-cent mark, suddenly it’s Sodom and Gomorrah.

There’s a useful marketing lesson in there somewhere, about tribes and passionate users (or non-users, as the case may be).

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