Musician Losing Revenue on Two Fronts: Streaming and Secondary Ticket Sales

Is it possible that secondary ticket sellers are hurting musicians almost as much as they infuriate fans?

There’s been plenty written on this site and many others over the past few months about fans being faced with the choice of missing out on seeing the final (?) Tragically Hip shows or having to pay incredibly high prices charged on ticket exchange and reseller websites like StubHub.

Now a new analysis suggests artists are losing out as well, while those who operate exchanges are lining their pockets.

StubHub, owned by eBay (not Ticketmaster, as is often asserted), reported some $1.06 billion in gross transactional revenues, a 35% increase over the same three-month-period last year, according to an analysis by TheSoure.com. “In three months, these transactions generated $225 million in net revenue for StubHub (eBay), an increase of 40% year-on-year. This growth was fueled by the recent acquisition of TicketBits and Ticket Utils, strengthening StubHub’s global footprint,” the article states.  StubHub alone was responsible for some $834 million in net revenues for eBay throughout the past four fiscal quarters, the analysis says.

By comparison, Live Nation (which owns Seatwave) reported a gross transactional ticket resale revenue that had increased 43% over the same period last year, making eight consecutive quarters with growth above 20%.  In 2015, Live Nation’s reselling platforms oversaw some $1.2 billion in transactional revenue across 13 countries.

“Combined with StubHub’s 12-month net revenue, that’s approximately $834 million, a year net resale total equals about $1.1 billion between both companies,” Rasheme Watson writes for TheSource.Com.

Any ticket purchased via one of these reseller platforms does not provide any money to the performer, Watson points out. Couple this with the ongoing, public and international outcry over the diminishing revenues from sales of physical media and digital sales, the fraction-of-a-cent payment for streaming services and complaints about getting shortchanged by services like YouTube, it’s no wonder artists are starting to speak out.

With open letters to Congress in the US and the creation of the FanFair Alliance in the UK, private complaints are becoming public discussion. But there’s very little talk about ticket resellers.

“We all know why: record labels are not affected by the secondary marketplaces—it’s the artists and managers that are most often hurt by this practice,” Watson writes. “The likes of Universal, Sony and Warner who believe they have bigger fish to fry are currently not focusing their efforts on chasing these secondary ticket resellers, instead focusing on YouTube. But if secondary ticketing and artist fans continue to siphon off hundreds of millions of dollars each year without penalty, what does it mean for the sustainability of music careers in the future? Does it not affect everyone working in music’s global ecosystem?”

Questions certainly worth asking, for musicians and fans alike. Read the whole piece here.