Ticketmaster Responds, But Street Doesn't Listen

Ticketmaster (TKTM) late Thursday issued a response to the stock market’s big sell-off of its shares on the news that Live Nation (LYV) has signed up concert venue operator SMG to use Live Nation’s new ticketing service.

Ticketmaster CEO Sean Moriarty asserted in a statement that the Live Nation news “does not completely reflect reality.” He says the news will have no short term impact on Ticketmaster’s business, asserting that SMG is contractually obligated to sell tickets through Ticketmaster for about 70% of the tickets it now sells for SMG venues through 2010.

The company also asserted that since SMG does not own the venues they manage, SMG “has a responsibility to make recommendations in accordance with the best interests of the municipalities that they represent.”

And they suggested not only that cutting ties with Ticketmaster is a bad idea, but also that Ticketmaster might decided to get into the venue management business. “If SMG makes decisions which no longer reflect the best interests of their clients, the results will be obvious - and causes us to consider whether we should enter the venue management business as well,” the company said.

Ticketmaster’s response, in short, reads like a print version of a tantrum; they are threatened, and angry, and they plan to do, well, something about it.

But the Street is not so impressed. Stifel Nicolaus analyst Scott Devitt Friday asserted that the stock looks oversold, but that nonetheless the company’s long-term competitive position “is at risk.”

TKTM, which Thursday fell $3.32, or 17.7%, closed Friday down another 89 cents, or 5.8%, to $14.56.

Comments

[Daveym:]

YES! Finally some competition to Ticketmaster's overpriced, monopoly service. So much for the overpriced $10/ticket "convenience" fee we've been forced to eat for years...

2008 Sep 13 05:02 PM

[Allison:]

I am a soon-to-be unemployed employee of Ticketmaster and this company has taken a very hard hit. They try and pretend to the public and media that business is not being affected at all, but it is complete and total crap. They are closing THREE entire departments and an average of 80 employees, including myself, are losing their jobs on Oct 30th. This is what Ticketmaster gets for not offering any other option for buying tickets 90% of the time and charging INSANE convenience fees that I have had to listen to customers complain about (and I agreed) for the last 2 years.

2008 Oct 04 08:52 PM