Ticketmaster - Growth And Expansion, 1998 To Present

TO PRESENT GROWTH AND EXPANSION (1998 )

In 1998, e-commerce was catching on with consumers, especially in the area of online ticket sales. Consequently, Ticketmaster's online business began to take off. In June, Computerworld reported that the company reached $20 million in online sales (500,000 tickets) during the first quarter, up from $5.3 million the previous year. The company also began expanding its e-commerce operations on the international front. Already the leading provider of tickets in the United Kingdom, Ticketmaster enhanced its position there by offering online sales in mid-1998. By the year's end, Ticketmaster Online-CitySearch Inc., which was handling the e-commerce side of the ticket company's business, reported revenues of approximately $40 million, a 159 percent increase from the previous year.

Many developments unfolded at Ticketmaster Online-CitySearch in 1999. USA Networks, which then had become the company's majority stakeholder, began the year by announcing that it would merge Ticketmaster Online-CitySearch, Home Shopping Network, and Internet Shopping Network/First Auction with Lycos. However, the agreement eventually was terminated. Instead, Ticketmaster Online-CitySearch and Lycos ended up forming a relationship that allowed the two companies to benefit from cross-promotional opportunities. Ticketmaster Online-CitySearch also saw online ticket sales surge to $60 million during the first quarter, an increase of 275 percent from the same period the previous year.

In 1999, Ticketmaster Online-CitySearch ventured into the business of online matchmaking and auction services by acquiring CityAuction Inc., a "person-to-person online auction community;" online dating and matchmaking service Match.com; and auction/matchmaking service provider One & Only Network. Ticketmaster Online-CitySearch then formed a partnership with USA Networks Inc.'s Internet Shopping Network (ISN). The joint venture allowed consumers to access the person-to-person auction services of CityAuction or the business-to-consumer auction services of ISN's First Auction from either Web site. Finally, in September Ticketmaster Online-CitySearch partnered with Excite@ Home, FairMarket Inc., and Microsoft Corp. to develop an online auction network capable of reaching more than 70 percent of all Internet users.

Also in 1999, Ticketmaster Online-CitySearch acquired the entertainment city guide section of MSN Sidewalk from Microsoft. Sidewalk included other services besides city guides—including yellow pages and buyer's guides—that weren't part of the deal. By November, Ticketmaster Online-CitySearch and Microsoft offered arts and entertainment information about approximately 3,000 U.S. locations via a new MSN Local Channel, and through the MSN Entertainment Channel and Microsoft WebTV Network. Ticketmaster Online-CitySearch also gained a direct link on MSN.com for ticket sales, and saw its Match.com subsidiary become MSN's featured personals service. Ending the year on a high note, USA Networks invested an additional $40 million in Ticketmaster Online-CitySearch, giving the company more capital for development and expansion. During the fourth quarter, overall revenue soared 168 percent over the previous year, and online ticket revenue jumped 262 percent. Annual revenues reached $105 million.

During 2000, Ticketmaster Online-CitySearch unveiled an electronic ticket service which allowed customers to buy and print Ticketmaster tickets from the comfort of their own homes. In addition to forging strategic and content-based agreements with several other companies—including ARTISTdirect Inc., Ask Jeeves, Yahoo!, and weather.com—the company also made several acquisitions. It acquired ticketing and visitor management firm 2b Technology Inc. in February; TicketWeb Inc. in May; and Essential Data Control Systems' Fan Loyalty System (a loyalty/incentive program for sports fans) in July. Finally, near the end of the year Ticketmaster Online-CitySearch announced that it would acquire Ticketmaster Corp. and change its formal name to Ticketmaster. The merger, which became official in January 2001, combined the offline ticketing and reservation operations of Ticketmaster Corp. with the other firm's broad e-commerce offerings. At the time, the company indicated that "The new Ticketmaster will have a customer database of over 20 million, including more than 12 million active customers, processing over 80 million tickets annually, through 3,430 ticketing outlets, 16 call centers, in more than 80 cities and via eight primary websites."

It also was in 2000 that Ticketmaster Online-CitySearch moved into the mobile and wireless arena. In February, the company announced that it had formed a dedicated wireless group and a new strategic partner affiliate program that allowed wireless content providers to provider subscribers with Ticketmaster Online-CitySearch's content, including local information, reservation and ticket capabilities, and personals. Ticketmaster Online-CitySearch's Local Intelligence service provided users with recommendations, as well as the ability to make reservations at restaurants and buy tickets from their mobile devices. As part of its wireless strategy, Ticketmaster Online-CitySearch made several moves to bolster its position in this area, including alliances and arrangements with companies like Phone.com, NeoPoint Inc., Verizon Wireless, Nextel Communications, and Sprint. It also made its content and services available to MSN Mobile and AT&T Digital PocketNet customers.

Ticketmaster Online-CitySearch made several developments on the international front during 2000 by extending offerings to Japan, Iceland, and Brazil. The firm's reach also had become very pervasive. By covering more than 2000 ZIP codes, Ticketmaster Online-CitySearch's local information offerings reached more than 90 percent of the U.S. adult online population, according to Media Metrix's Measures Report, released in February. Financially, Ticketmaster Online-CitySearch saw its revenues increase approximately 110 percent in 2000, reaching $220.6 million.

In 2001, Ticketmaster Online-CitySearch's acquisition of Ticketmaster Corp. became official. Growth and expansion continued to occur. That January, the newly named Ticketmaster announced that it would acquire ReserveAmerica Holdings Inc., which at the time was the nation's leading campsite reservation company, allowing customers to make reservations at more than 150,000 campsites in 43 states. The acquisition allowed Ticktmaster to expand its reservation capabilities outside of the ticket business. Ticketmaster announced two more acquisitions during the spring. In March, it announced the acquisition of Evite.com, an online activity center where people planned a wide range of events from baby showers to weekend getaways. The acquisition extended Ticketmaster's capabilities by making its offerings more comprehensive. In addition to offering people the ability to buy tickets, make reservations, and find out more about cities via CitySearch, Ticketmaster customers were now able to plan their events in those cities.

The company also continued to expand internationally in 2001. In March, Ticketmaster subsidiary Match.com and MSN.co.uk, then the most visited Web site in the United Kingdom, formed an alliance that resulted in Match.com being featured as the main personals service on MSN.co.uk's Love and Relationship channel. In April, Ticketmaster announced that it would acquire Towne Ticket Centre. Based in Kelowna, British Columbia, the acquisition expanded Ticketmaster's presence in that Canadian province. The firm extended its reach in Norway as well by announcing the acquisition of Billettservice AS, the country's leading ticket company, in October.

Besides acquisitions, Ticketmaster continued to form strategic alliances with other companies, including ones between FlipDog.com and Citysearch, and Network Communications Inc. However, one of the leading alliances it formed in 2001 was with America Online (AOL). As part of the deal, Ticketmaster agreed to offer the ticket and movie information of AOL Moviefone on its local city guides. In return, it was able to distribute its tickets through AOL. Ticketmaster also was able to have Match.com offered on Netscape.com, CompuServe, AOL.com, and AOL, and have the site included as the main personals service on Love@AOL.

In the area of services, Citysearch began providing users with automobile pricing information from Edmunds.com Inc. Additionally, Ticketmaster saw the use of its "Print My Own" technology, which allowed users to print bar-coded tickets from their home or office computer upon purchase, begin to take off. The technology was adopted by several leading organizations during 2001 including the Rose Garden, Orlando Magic, Seattle Mariners, National Car Rental Center, and the Utah Starzz. Midway through 2001, Ticketmaster also re-launched its Match.com subsidiary with an upgrade that made it easier to use. The re-launch was made in June, due to strong growth; Jupiter Media Metrix had rated the site as the leading online dating and personals site that April. Despite the challenges faced by many dot.coms, the pervasiveness of Ticketmaster, as well as the scope of the services it offered, seemed to position it well for success in the early 2000s.