Ticketmaster To Dominate Ticket Industry With Blockchain Technology
Ticketmaster, one of the foremost significant event ticket distributors across the globe, declared in October 2018 that it had acquired ‘Upgraded,’ a blockchain technology company specializing in live event ticketing.
Ticketmaster is all set to solve some of the biggest challenges facing the ticket industry through blockchain technology. For instance, the company plans to use blockchain to provide event creators with more authority and visibility over ticket distribution, while shielding fans against deceitful tickets.
On Dec. 9, Sandy Khaund, Ticketmaster’s vice president of blockchain products and former CEO, discussed how Ticketmaster is presently leveraging blockchain for use cases that are being conducted.
In particular, Khaund considered that smart contracts would ultimately allow Ticketmaster to trade “smart tickets.” Khaund emphasized, “We are writing specific code for each ticket we sell and then running that on a private blockchain.”
Khaund remarked that Ticketmaster implemented smart contracts to a pilot use case where tickets for a ‘Pearl Jam concert’ were traded for $150. The smart contracts were meant to assure that tickets could not be sold for more than the amount they were purchased for. Each smart contract comprised an override function for transfers, along with a transfer counter.
Regarding the smart contracts, Ticketmaster has been leading, Addison discussed that while this sounds very introductory, it could be useful if appropriately executed. He said, “This could be useful for organizers, artists, and fans alike, but Ticketmaster has a bit of a way to go before fully implementing this technology.”
Addison noted that if executed appropriately with tickets, smart contracts can be utilized to provide artists and event organizers the control of the tickets’ cost even on secondary markets while also attaching payments and other variables through smart contracts.
Furthermore, once controlled pricing of tickets is accomplished, demographics can be achieved that would allow the secondary market to provide to fans directly building a truly decentralized solution for the ticketing industry. Addison further explained that smart contracts would enable P2P transfers:
“But while this is helpful for the secondary market, it must be implemented in the primary market first. In this case, Ticketmaster is the primary market issuing the tickets, but they need to start thinking about a secondary market function to create true decentralization.”
Decentralized Ticketing via Tokenization
The author of the book ‘Blockchain Revolution’ and co-founder of the Blockchain Research Institute, Alex Tapscott, also acknowledged that Ticketmaster’s utilization of blockchain technology could cripple the ticketing industry. Tapscott stated that Ticketmaster’s dominance over the ticketing market could result in less decentralization, even when smart contracts are applied.
He said, “The recent digitization of tickets has turned scalping from a decentralized market to one where one central scalper, Ticketmaster, for example, controls the entire market. As a result, these middlemen can charge outrageous prices because there is no price discovery happening in an open market.”
Tapscott recommended that tokenizing event tickets could resolve many problems facing the industry. Individuals would be competent to barter and trade peer-to-peer, allowing lower rates, better price discovery, and fewer forged tickets and would probably end, “the double-spend problem which still occurs with photocopies of barcodes, for example, and less value being captured asymmetrically by some sanctioned middleman like Ticketmaster.”
Although tokenization may be the missing link required to present a genuinely decentralized ticketing market, industry specialists still find Ticketmaster’s application of blockchain to be a crucial step in achieving a more effective ticketing system.
‘Alan Rakov,’ the vice president of business development and ticketing partnerships at ‘FanDragon,’ an open, blockchain-powered software-as-a-service mobile ticket delivery system believes that Ticketmaster’s use of blockchain technology will eventually benefit the entire ticketing industry.
He said: “The concept that there won’t be price discovery because of Ticketmaster using blockchain doesn’t ring true to me. While there might be a better way to do it, I don’t think that Ticketmaster will gain control of the ticketing market. If anything, this is an experiment to move the market in the right direction.”
Use of Private blockchain Or Public blockchain
One concern Rakov brought up was Ticketmaster’s usage of a private blockchain. While private blockchains are proficient in managing more transactions per second, they render less transparency. “We think open is a better way of doing this as opposed to closed,” Rakov said.
While presenting insights to secondary markets can be achieved more comfortably using a public blockchain, there are still some vital benefits a private blockchain could give to ticket distributors. Jerry Cuomo, the vice president of blockchain technologies at IBM, stated that a blockchain solution, such as ‘IBM’s True Tickets,’ can address many difficulties facing the ticketing industry, such as deceitful tickets and scalping, by assuring ticket authenticity, traceability, and fair pricing, presuming that:
“They are adding value in the form of ticket controls and analytics to identify who ‘true fans’ are and how to reward them via special or exclusive offers.”
True Tickets creates and preserves ticket origin by identifying all buyers and sellers to guarantee that both the tickets and the people purchasing them are true. It also acts as an immutable ledger that allows venues, artists, promoters, and fans to trace a ticket through each stage from its production to its use at an event.
According to Cuomo, while the project is still in its initial phase, ‘True Tickets’ and ‘Shubert Ticketing’ have plans to launch a pilot to examine reliable mobile tickets for Broadway shows in 2020.
While several ticketing distributors are starting to employ blockchain technology in various ways, one thing that each company appears to agree on is that it should be stored in the background. “When we use blockchain, we don’t want people to know. We want people to like the product,” Khaund said on stage at Elev8con.
Addison stated, “There is a lot of technical expertise required behind the inner workings of blockchain. Event organizers typically aren’t technical and, therefore, won’t care about the technology being used to secure tickets. They care about keeping fans and artists happy.”