Promoter's rules curb gouging on concert tickets

Back - Index - Submissions - - What is RSS? Date: Feb 08, 2000 Source: The Denver Post Submitted By: Promoter's rules curb gouging on concert tickets By G. Brown Denver Post Special Writer Feb. 2 - In the wake of controversy over its alleged sale of prime concert tickets to scalpers, House of Blues Concerts has imposed new rules aimed at curbing the practice, according to an internal memorandum obtained by The Denver Post. The action comes in the wake of accusations, first reported in The Post, that HOB Concerts sold blocks of the best seats at several of its concerts to ticket brokers at a premium without first making them available to the public at list price. The memo orders HOB Concerts managers to limit sales of premium tickets to eight per cus tomer. It also orders that contracts for sale of prime season-ticket seats must now include language "prohibiting resale of the ticket above face value." "The ... issues we have recently faced in Denver have prompted many questions from both inside and outside our company regarding our premium ticketing policy," said the memo, dated Jan. 25, from HOB Concerts President Jay Marciano to the company's managers. A copy of the memo was made available to The Post by sources who requested anonymity. "After reviewing all of our premium ticketing programs, it is clear that we need to take stronger steps to discourage brokers from reselling our tickets at significant premiums," the memo added. However, the memo also notes that HOB "cannot legally prohibit brokers from buy ing our tickets" in parts of the country, like much of Colorado outside the Denver city limits, where brokers operate legally. Marciano was unavailable to comment on the memo Tuesday. In a series of articles late last year, The Post - quoting several former HOB Concerts employees with firsthand knowledge of the company's financial dealings - reported that the promotion house had sold prime seats to ticket brokers at several of its concerts over the previous two years in Denver and other cities. Some of the Denver shows involved included Elton John, Pearl Jam, Jimmy Buffett, Shania Twain and the Spice Girls. The practice of selling tickets to brokers meant that music fans who stood in line at Ticketmaster outlets to buy tickets for popular shows promoted by HOB had less chance of getting prime seats, or had to pay huge markups to brokers. The policy was carried out under the direction of Marciano, at corporate headquarters in Universal City, Calif., to boost profits, sources told The Post. HOB's dealings with brokers came to light when accountants for the Backstreet Boys discovered that hundreds of prime seats controlled by HOB at the group's sold-out Oct. 31 show at the Pepsi Center had been sold to brokers and resold at many times their list price. HOB denied knowingly selling the seats to brokers. House of Blues Concerts is one of the largest promoters in Colorado, operating Fiddler's Green Amphitheater and regularly booking concerts into the Pepsi Center, the University of Denver's Ritchie Center, the Paramount Theatre and other venues. HOB Concerts was known as Universal Concerts until its sale by Seagram Co. to House of Blues Entertainment Inc. in July. In the memo shown to The Post, Marciano specifies new policies for the handling of "SuperseatS," the company's name for season passes, as well as house seats, which are usually set aside for use by VIPs and business clients. In addition to the eight-ticket-per-customer sales limit, Marciano ordered that no "SuperseatS" or house-seat tickets be sold in rows one through five of a concert venue, and that "no house seats are to be sold above face value plus the customary house seat fee charged for that event." He also instructed company sales managers "to carefully monitor sales and customer usage of all premium seating programs ... (and) "to immediately report any potential abuses" to top HOB Concerts executives. Marciano said the new rules are designed to "ensure equal access to tickets and SuperseatS in all price ranges and limit the ability of any individual or entity to access large numbers of premium tickets." On Dec. 19, The Post reported that HOB general managers in seven markets across North America, including Denver, had been instructed to deal prime tickets directly to brokers in a program not announced to the public since May 1998. In each market, The Post reported, brokers paid an annual feel ranging as high as $1,500 for each pit or orchestra seat - nearly double the fees charged regular season-ticket holders. In response to The Post's reports, Greg Trojan, president and CEO of Los Angelesbased House of Blues Entertainment, said in December that he was launching an internal investigation, and that there would be changes, including a plan to scale back the SuperseatS program. Comment on this item. Next Item: Boys slated to perform at Grammy's Prev Item: Lycos Top 10 Search Terms For The Week Ending Jan. 29, 2000