Markets

Why Blockchain Matters For The Live Event Ticketing Industry

By Greg Consiglio

The live event industry has long been criticized for its ticketing practices. The process of buying tickets to a live event is far from enjoyable. Technical inefficiencies, ticket allocations to insiders, bots scooping up large portions of tickets and ticket resale all contribute to fan frustration.

Most of us have experienced the disappointment of not being able to purchase tickets when our favorite band goes on sale, or been priced out of the resale market by brokers on resale sites, or have bought a ticket from a broker as a last resort only to get denied at the gate due to faulty barcodes. While live events can be a once in a lifetime experience for fans, the live event ticketing industry mostly fails to provide fans with anything close to an experience that matches the occasion.

Fans have every right to expect greater transparency throughout the process. The industry is well aware of its challenges, many of which are self-inflicted and accepted as ‘business as usual.’ Event organizers routinely hold back a percentage of tickets when tickets go on sale to the public, and set them aside for insiders or direct them to resale sites. While the industry has certainly made strides recently, it’s not enough. It’s not just the bots denying fans the opportunity to buy a ticket, the challenges stem from a variety of business practices associated with allowing a ticket to be transferred with no rules attached, and for identity to be meaningless in the sale of a ticket.

Working at Ticketmaster and subsequently with other leading music, live event and ticketing companies, I have seen up close how these dynamics impact fans, artists, venues, and promoters. The whole system is impacted on varying levels. There have been some great technical advances in recent years, but the challenges still persist. And that’s why I was intrigued when I learned that smart contracts and blockchain could be used for live event ticketing.

What if the ticket was actually considered a contract between the event organizer and the fan who bought it? By creating a smart contract for every ticket sold, artists, teams, promoters and venues could establish the rules and maintain control over how that ticket gets sold and transferred.

Blockchain is better for fans

Marketing, selling and buying tickets to live events is not easy. Events are perishable: There is only ever a finite number of tickets to any event on a given day. Demand fluctuates based on awareness, pricing dynamics and seat availability, meaning the price fans are willing to pay also varies. There is also the long-standing approach to primary ticket sales whereby fans rush to websites only to discover the best seats have been scooped up by bots and ticket brokers for resale or held back by the promoter or artists for select fans and partners. This has become a standard industry practice that fans are expected to tolerate.

Brokers use bots to gather up thousands of tickets before fans can purchase them, and as soon as the show sells out, they jack up the prices. Worse, some brokers are dishonest, selling fans duplicate tickets.

A blockchain-based solution could completely eliminate any incentive for brokers to get involved in the market. Tickets created on a blockchain would come with fixed rules about pricing that prevent ridiculous price hikes no matter how many times a ticket is resold. This solution would also eliminate ticket fraud by making each ticket unique and immutable, by creating a smart contract between the event organizer and the fan.

Blockchain is better for artists and venues

To create a closer relationship with their fans, artists can use blockchain ticketing protocols to improve the ticket buying experience for fans. They can decide who attends their events and create best practices around ticket allocations.

Fraudulent tickets are a problem at the gate that slows down entry for everyone. A blockchain ticketing solution would eliminate fraud, and could offer a faster, more secure entry process.

Blockchain is better for rewards

Brands who align with live events are looking for the latest digital opportunities to engage with their target demographic. Sponsors need innovative ways to interact with event attendees to create authentic activations. Blockchain ticketing implies enormous potential for sponsor engagement by using the native token of the blockchain. Sponsors could potentially use those tokens as incentives or rewards for fans who engage with their brand.

These are just some of the reasons I’m excited about blockchain-based ticketing. The live event ticketing industry is overdue for some new technology, and to rid itself of certain long-accepted business practices that don’t put the fan first. Exciting new platforms such as the recently announced Blockparty, are offering these much needed solutions and will be instrumental in creating a better experience for all.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.