Fan club sites eliminate the middleman with 'presales'

Tired of scalpers marking up ticket prices and frustrated with high service fees from brokers, many music acts are taking more control of their ticketing as a way to connect with fans.

The biggest trend is for bands to offer tickets through their online fan club sites, with some charging annual membership fees. U2 charges $40, the Dave Matthews Band charges $35, and Madonna charges about $38.

The intent is to get tickets into the hands of diehard fans before the tickets go on sale to everyone else. Typically, bands hold Internet ''presales" to club members a week or two before a public sale, which is usually handled by broker Ticketmaster.

But for fans, the clubs certainly don't guarantee tickets. Nor cheap tickets either. Last year Madonna's fan site offered $700 VIP seats. But bands for the most part offer lower service fees and throw in discounts on merchandise and other sweeteners to promote artist-to-fan interaction without a middleman.

One concern is that some scalpers just join the fan clubs, which was a problem with a recent U2.com presale. But bands are making vigorous attempts to cross-check names, credit card numbers, and e-mail and postal addresses to weed out violators who may be buying tickets in bulk, as well as work with online auction site eBay to identify culprits.

''You can't always make everyone happy, but we do the best job we can," says Coran Capshaw, who manages the Dave Matthews Band and heads Musictoday.com, which handles fan sites for Madonna, Kenny Chesney, Britney Spears, and other top-name acts.

Musictoday.com operates out of Charlottesville, Va., and employs 200 people who coordinate the ticketing and the discounted merchandise and other privileges (from CD samplers to special magazines) that come with the memberships. Tens of thousands of fans have joined the Matthews band's fan site called ''Warehouse," says Capshaw, who declined to be more specific.

Capshaw says his role model was the Grateful Dead, who pioneered direct-mail marketing. The Dead would take up to 50 percent of a venue's seats and distribute customized souvenir tickets.

Most bands can now only get 8 to 10 percent of a show's tickets because they run up against tight contracts between Ticketmaster and the venues. In the touring business, concert sites such as the Tweeter Center and Bank of America Pavilion make agreements with Ticketmaster to sell tickets and charge customers a fee for that service. Ticketmaster then shares part of the service fees with the music promoter and the venue, but not the bands.

Acts that have lobbied to control their tickets for years, such as the Dave Matthews Band and String Cheese Incident, can get a higher percentage of a show's tickets. When Ticketmaster tried to cut back String Cheese's allotment in 2003, the band filed an antitrust suit against the ticketing agency. The suit was settled out of court for undisclosed terms, and String Cheese now says it is pleased with its current share.

John Pleasants, chief executive of Ticketmaster, said ticket presales have gained in popularity the last five years, in part because bands are trying to develop new revenue streams through their fan clubs. Pleasants said Ticketmaster runs the presales for many bands.

''Artists are the people who are at the top of the value chain," Pleasants said. ''These are the people who create the content and there is no question that, as a generalization, these folks are looking to get more compensation for what they do, as opposed to less, and so they will look for opportunities like fan clubs or extra merchandise sales."

Some venue promoters dislike fan club sites. A Clear Channel Entertainment executive says a fan club presale can hurt the subsequent public sale of tickets because many nonmembers will assume the best seats are already taken. For that reason, Clear Channel in Boston, the executive adds, makes sure that many good tickets are still held for the public sale.

Lower service fees are another key reason fan club sites have flourished. The jam band String Cheese Incident tacks on an average fee of $4 per ticket, but that's often less than half of what Ticketmaster might charge.

''Hopefully by lowering the fees, the fans can afford to see more music," said String Cheese manager Mike Luba.

His group first started selling tickets out of a candle shop run by bassist Keith Moseley's brother, Kevin, a decade ago in Durango, Colo. That evolved into SCI Ticketing and is now called Baselineticketing.com, which has since signed up more than 20 acts, from punk superstars Green Day to Boston breakout band the Dresden Dolls. Most of Baselineticketing.com's acts do not charge membership fees because they are opposed to a ''two-tiered process" that allows wealthier fans to have an advantage over those of more modest means.

''Still, you might rather pay $40 for a membership than pay scalpers for tickets," said Bob Grossweiner, a senior editor with liveDaily.com, an online magazine about the music industry.

Dashed expectations can anger fans, as U2 learned when the presale for the first leg of its American tour went awry. Many members didn't get tickets, fans complained, and the band apologized.

''We weren't expecting the amount of members who joined," said Sebastian Clayton, brother of U2 bassist Adam Clayton, who runs the site. He said the system was overwhelmed when tickets became available in January.

''We were left in the lurch and weren't able to fill everyone's order," said Sebastian. He said the problem was fixed after U2 tacked on another leg to its tour.

Fan club sites can be big business. Take U2.com. With 100,000 members paying a $40 annual fee, that amounts to $4 million of revenue.

''It's capitalists outfoxing other capitalists," Grossweiner says.

Steve Morse can be reached at morse@globe.com. Bruce Mohl of the Globe staff contributed to this report.