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Volume 21 No. 10
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As Amazon builds up ticketing business, some hurdles remain

Amazon has dramatically transformed many segments of commerce, including online retail and digital media. Its entry into ticketing, however, could face greater obstacles before it approaches a similar impact.

Over the past two years and with little fanfare or public comment, Amazon has built up a ticketing operation covering both sports and performing arts venues, beginning first with theaters in the United Kingdom and now moving toward the U.S. and elsewhere.

The company last fall quietly hired former New York Mets and Boston Bruins ticketing executive Leigh Castergine to lead business development for sports and entertainment for Amazon Tickets, which was followed by bringing on former Groupon executive Michael Shaw in May. It has also hired dozens of other domestically based developers and engineers.

Its current job listings describe Amazon Tickets as “a start-up business with a vision of becoming Earth’s most customer-centric ticketing company, a place where event-goers can come to find and discover any ticket they might want to buy online.”

That shows a huge level of ambition. But what exactly will Amazon’s place in the ticketing landscape be, particularly within sports? The company declined several requests to detail its plans, but a Reuters report last month suggested it will mount a serious challenge to established players such as Ticketmaster.

Other ticketing industry executives expect that Amazon will seek to become a distribution partner to other ticketing companies rather than build a full-service, enterprise-level box office system itself.

In theory, that would allow teams and venues to tap into Amazon’s deep well of e-commerce customers, and provide a powerful forum to market tickets to fans who don’t ordinarily visit traditional team websites and mobile applications. Such an approach would also be consistent with Amazon’s other business ventures that have sought to increase subscribership in its Prime membership program.

“More tickets in more places is good for fans and good for rights holders,” said Russ D’Souza, co-founder of SeatGeek, which has been actively developing its SeatGeek Open model that would enable a diverse distribution system for tickets. “We expect massive transformation in primary ticketing as large technology companies like Amazon enter the space and start moving significant numbers of tickets.”

But to established primary ticketing operators, Amazon still presents a quandary. Other ticket distribution partners such as StubHub, Groupon or ScoreBig have traded heavily on secondary or distressed inventory, and extensively shared transaction data as they have partnered with primary ticketing companies and content owners. Amazon getting into primary sports ticketing and gaining access to top-tier inventory would likely require significant rights-fee payments and liberal sharing of customer data, and it’s not certain whether Amazon is willing to make either step as they develop Amazon Tickets. Numerous media reports have suggested Amazon’s talks with companies such as Ticketmaster have stalled due to disputes on control of consumer data.

And after a brief selloff last month of stock for Ticketmaster’s parent company Live Nation Entertainment on news of Amazon’s entry, shares are still up more than 50 percent for the year to date.

“I’m not sure anybody is necessarily running into their arms. The data question is definitely a big challenge,” said one rival ticketing executive speaking on the condition of anonymity. “It’s also not clear to me what problem Amazon is fundamentally solving, and I think it’s still a high bar for them to clear.”