Ticketmaster Grabs Rival

Ticketmaster Online-City Search Inc. added to its ticket offering portfolio
Tuesday by acquiring small rival TicketWeb Inc. for $35.2 million in
stock.


Ticketmaster Online will issue about 2 million shares
of common stock, or about 2 percent of its outstanding shares, for all outstanding TicketWeb equity.


With the purchase, Ticketmaster Online-City Search will tap into the small
to midsize venues that make up TicketWeb’s clientele. Privately-held
TicketWeb sells tickets online and over the phone for about 700 clients,
including nightclubs such as New York’s Bowery Ballroom and organizations
that include the San Francisco Symphony and the San Diego Zoo.


The smaller firm also sells ticketing software that can turn a desktop
computer with an Internet connection into an online box office without
special equipment.


“This deal makes sense for Ticketmaster,” said Malcolm Maclachlan, media e-commerce analyst for International Data Corp. “We’re going to see all sorts of consolidation of smaller companies into monoliths like Ticketmaster. I’m kind of surprised at the acquisition price. You have to wonder if they made a cost concession by managing to keep their brand name.”


TicketWeb will remain a separate brand from Ticketmaster, and will work in
conjunction with the larger firm’s City Search network.


Ticketmaster Online-City Search, a publicly-traded company that is majority
owned by USA Networks Inc., operates Ticketmaster.com and the City Search network of local city
guides.


Ticketmaster’s last major play was the launch of a new mobile service in 32
cities that gives users access to events at more than 3,750 venues using
mobile communications devices such as phones, pagers and personal digital
assistants. Dubbed Local Intelligence, the service combines editorial
content and the ability to conduct a transaction, from a mobile device.


The deal by the leading ticket supplier marks the second such purchase in
the past year. In February, the company grabbed 2b Technology, which
specializes in ticketing for museums and historic sites, for about $23
million in stock.


Harry Wolhandler, vice president of research for ActivMedia Research, said TicketWeb is a nice complement to Ticketmaster.


“They’re really getting down to localization,” Wolhandler said. “It seems Ticketmaster will gain the ability to manage their own ticket sales with TicketWeb’s software. Ticketmaster is adding parts they are missing.”

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