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Is Ticketmaster fleecing its customers, or is Leonard Cohen that popular?

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Ticketmaster (NASDAQ: TKTM) finds itself on the end of new allegations that it is fleecing customers, thanks to a Leonard Cohen show -- yes, Leonard Cohen. Back in February, the company announced a merger with Live Nation in a $2.5 billion deal to create the nation's largest ticket provider. This deal prompted quite a bit of speculation on monopolies, along with some disdain for the involved companies.

It seemed that Ticketmaster had fallen out of the public eye for a while, although people still complain about the 40% surcharge to purchase tickets. Enter Leonard Cohen. Two different articles surfaced this week, one from Canada and one from Los Angeles, complaining about the company's business practices stemming from ticket sales for Leonard Cohen shows.


Long story short: People went to buy seats for a Leonard Cohen show online at Ticketmaster -- only to be told that the show was sold out (three minutes after the sale started in one instance). Disappointed fans of the Canadian musician were then directed to the Ticket Exchange Marketplace (or TicketsNow in Canada), where Cohen tickets were available -- at a greatly marked-up price ($1,254.02 in the case of Ticket Exchange).

Big deal, right? Did you know that Ticket Exchange and TicketsNow are both operated by Ticketmaster? No one has come out and flatly accused Ticketmaster of duping its customers, but something doesn't jive here. Is Ticketmaster jobbing its customers? Possibly, but I would prefer to think that this isn't the case. I just know that this situation sure smells fishy. Maybe Leonard Cohen has such a devoted following that this situation is possible -- or maybe not.

For what it is worth, Ottawa's attorney general is reportedly looking into the situation -- which is eerily similar to the Bruce Springsteen debacle in New Jersey. That concert cost Ticketmaster $350,000 and caused a change in Ticketmaster's U.S. sales practices -- perhaps not enough of a change.

One thing is certain, the stock is not doing well (it is trading this morning just uner $4), and news of this ilk may do more harm than good.

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Last updated: November 27, 2009: 08:09 PM

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