GW: Hi this is Barney Moran, of the Grateful Web, and I am here with Jason Mastrine, the general manager of SCI Ticketing, Mike Luba, Co-founder of Madison House Inc., and Neil Glazer an attorney with the Philadelphia law firm of Kohn, Swift and Graf, P.C., who is leading the team of lawyers representing SCI ticketing in the lawsuit concerning SCI Ticketing and TicketMaster.

We want to thank Madison House and The String Cheese Incident for donated packages and signed art they've given to Mimi Fishman auction over the years, that totals in the thousands of monies that they've raised for good causes. And that's in addition to their own internal Gouda Causes, which concerns food banks and all that great stuff as well and uh, thanks so much that's something that you're not known for I just wanted to give you a little credit for that.

Before we get into the real nitty gritty, I just wanted to familiarize our listeners and browsers with what Madison House is, the artists you guys represent, and maybe some of the unique ways you work with them…

Mike Lupa: Sure, Madison House is a multi-tiered company that has developed to serve artists in their business endeavors, and it started out as a small boutique booking agency in Athens, Georgia And has turned into a company that has a lot of different things going on, everything from publicity to travel to merchandise to management to booking. And some of our artists use all of the services, some use parts of it, it's really, it's really up to the artist to see what we can do to help.

GW: So, on a scale of one to ten, where 10 is full serve and 1 is a la cart, what would one and then what would 10 be?

Mike: Well one would be, if you were just hypothetically a client of the just ticketing and nothing else, and 10 would be Keller Williams or The String Cheese Incident who basically uses everything that we have going.

GW: And everything it sounds like is representation, venue placement, things like that?

Mike: Yeah, we run an agency that books the shows, we run a management company that takes care of all the day to day and long term planning for the career of the artist, and then you know we have specialists basically who run their own companies underneath the umbrella…So we have--

GW: ---So, when you use the term boutique firm, how many other boutique firms are there out there like you?

Mike: There's a few. I don't think our idea was particularly unique or brilliant it was just we arrived at the space more out of self defense then anything, and there's kind of a tradition of really successful bands trying to keep as much control of their own careers as possible but I think we've potentially taken it to a different space that for, really for The String Cheese incident they truly control every aspect of their own careers: there's no outside label, there's no outside anything, its all within the family of companies.

GW: Ok, so this is where it's kind of fascinating to me, because I think you've got an artist like String Cheese, that has a very clear of idea from themselves of what they want to be, and it's almost like you need to exist for them to accomplish that. And that's a really unique relationship…Does that sound fair?

Mike: I think what our deal was with those guys from the very beginning was to let them do nothing but think about making and performing music, and we would take care of all the crap that they had no interest in or desire to deal with, and that's really been the nature of the relationship from the beginning. When it's really functioning right, the guys in the bands, you know guys like Keller' don't have to think about anything but music, and that generally leads to more powerful, potent music being created.

GW: Ok so we've got this wall that Madison House can build to protect the artists from the crap so they can create, so now SCI Ticketing/Madison House is trying to let SCI be music makers, and what happens? They…they encounter TicketMaster?

Mike: Well it's not a new thing, I mean this has been an ongoing process since the day we really started. What has happened is that what used to be a relatively benevolent relationship, as the band has grown and our companies become more and more successful, and the technology continues to advance we now pose a very, very real threat. In the sense that their a Behemoth of a company and I think that they realize that to protect themselves they had to lock down somehow because things were gonna get completely out of their control and they were gonna find themselves obsolete very quickly.

GW: Was there a moment, and I know you say it happened over a long time, and TicketMaster's been around for our complete collective memory, but during the movement to say hey, we can do this better than TicketMaster, was there a moment, a spark that happened? Or was it the edict as you say, that TicketMaster sent out that made it happen?

Mike: I think that what we realized was that, as the management or agent trying to book the actual shows, there was starting to be a tremendous disconnect between what we wanted the ticket price to be and what it was ending up to be for the consumer by the time they actually got the ticket in their hands, and we were sitting around going there has to be a better way. And really the ticketing concept, we basically just followed the lead of what the Grateful Dead did with their mail order and being, you know, products of a new generation, we took mail order and turned it into essentially glorified e-mail order. That has now progressed into a system where we can do High Volume reserved seating with a shopping cart. Which really no one else can do. Which is what kind of makes the system that Jason and his group built pretty unique and special and worth fighting for.

GW: Ok, so Jason builds this system, and you Mike, you're running Madison House, but I'm still curious about the straw that broke the camel's back here, because it's a big decision, and in that straw I'm thinking you have to maybe go to your artists, or maybe String Cheese, your number 10 artist, and say, 'This is what we think the next step should be.'

Mike: Well TicketMas---I mean the reality is they stopped giving us tickets, despite years and years of being able to procure allotments, which we could do whatever we wanted with. There was a very clear edict passed down from TicketMaster to all the venues and promoters saying 'don't give SCI Ticketing tickets anymore to sell to their own shows.' And at that point we realized there was no option, there was no where else for us to go.

GW: So you had been trying to work with them up to that edict.

Mike: Absolutely.

GW: Oh, ok.

Mike: and I mean to the point that at one point we basically were using the TicketMaster system to run our company, but it was such an unmitigated disaster that it almost put us out of business because their system didn't work and couldn't do what we needed it to do. There was tremendous harm inflicted upon the kids who keep us in business by buying tickets to our shows---

GW: I was going to ask--

Mike: --There was never a master plan of any sort to go out and 'fight the fight', or anything like that. I mean I wish we were that righteous but it wasn't that it was: we realized we could sell a ticket with a four dollar service charge, and through TicketMaster it's twelve dollars and that's basic economics: it's better for everyone.

GW: So it's as simple as it could be, a market stall selling fruit?

Mike: We sell an apple for four dollars and you can buy the same exact apple for twelve dollars and we're going well, this is still America, monopolies are still illegal, as far as we can tell.

GW: -Ok well I'm gonna cut out my question

Mike: there was no option--

GW: I was gonna ask about trusting the American system, but I'll just cut that question out, you basically were, had your cart cornered off in the market…sounds like…

Mike: There is no market if we go along with what TicketMaster's dictated, we have no market. SCI Ticketing shuts down, and we're out of business.

Jason Mastrine: Yeah, there's no trust in the American System, at least not in the economic system, we're gonna trust the legal system at this point to lead us in the right direction. But the fact is that, to take the apple cart scenario a step further, I feel pretty strongly that it's the equivalent of us offering an organic apple versus a pesticide covered apple---

GW: (laughs)

Jason: I mean really, its kind of a different product in that---

GW: I like it, yeah---

Jason: We're providing really quality personalized customized customer service, we're providing an alternative which fortunately for us, an alternative in and of as itself is a great option when your competing, when your selling tickets versus someone like TicketMaster. Because everyone hates TicketMaster so much, and we provide customized souvenir ticket stock, and the people feel really good about buying through us. So its not like widgets, in that you feel like maybe you got a good deal in that you got your widget for ten cents cheaper then the other guy, its truly, we really truly feel it's a better product. That's really our biggest concern, that we're allowed to sell our product which really keeps this whole machine going. This whole Madison house thing going.

GW: When you look at Pearl Jam's attempt earlier, did it, did their mistakes, and if there were some successes they had, I'm really not that familiar with the facts of their case, did that help you plan the legal approach?

Neil: Not really. There were huge differences between what Pearl Jam attempted to do and what we decided to do in terms of legal strategy. I mean Pearl Jam, they were incredibly brave to try and take on TicketMaster in the way they did, but they really were trying to get the US Government either through the Department of Justice or Congress to take some sort of action. And for whatever reason that effort just kind of withered and died. Technology has changed, we now , we've got a real ticketing company with a System really works well. So we decided that because of the space were in and the legal problems we think TicketMaster has created for itself to take this straight to court.

GW: That's Neil, right? That responded?

Neil: Yep.

GW: I'm gonna just ask about like Microsoft. Did we win with Microsoft? Because it seems like we lost the Netscape Browser, and they still are the operating monopoly, I'm just being a Devil's advocate here about what your facing…

Neil: Yeah, well the Microsoft one is a tough example, I think there's a lot of critics who rightly say no, we didn't really win anything with Microsoft. And in fact I believe that. I don't know if it was earlier this week or last week I saw that even the Judge in the Microsoft case is now questioning whether the remedies she tried to put in place are working--

GW: --I think they were supposed to sell access to the system for $100,000 or $50,000

Neil: Exactly-

GW: and no one's buying it-

Neil: No one's buying it-

GW: OH I'd be frightened to do anything against them if I was doing (business), right?

Neil: Yes, well when you're dealing with a big bad monopolist it can be pretty scary. Most people are inclined just not to rattle the cage, and to figure out ways to just go along and get along. I think they're still kind of taking a look at what happened in the Microsoft case and trying to figure out whether any of it worked or not, but I think it's a pretty fair criticism to say maybe that didn't work--

GW: You guys, did you guys-

Neil: Well-sorry--

GW: No, you can keep going, I'm just excited--

Neil: Well, I mean, having said that, that doesn't necessarily create any concern on my part, because this is a somewhat different case than the Microsoft case. There are some interesting parallels, but we now get a chance to go and make our case and we don't have a lot of the complexities and the messes that were involved in the Microsoft case, for example you had all these different states with their Attorney Generals that were involved, didn't have necessarily the right agenda, couldn't really agree on exactly the right approach to take, We're in the drivers seat on this one.

GW: Is that one reason you're not, or I don't know, but what I'm asking is why you're not in a Class Action with maybe other bands…

Neil: I'm not really sure that I can really answer that….

GW: So that could happen down the road?

Neil: It could happen. It could possibly happen..

GW: ---cool cool cool

Mike: The support from other bands has been tremendous--

GW: --That's what I wanted to-yeah, So and then my question is the support kind of like personal support, but then in public just kind of sitting on the sidelines? -and I'm not knocking them--

Mike: We take it one day at a time I'm pretty confident when the day comes and we go to the general music community and say, alright let's rally the troops…

GW: Ok, so right this is essentially the charge of the Rohirrim, that you guys are running, and it may be that we'll bring in some troops--

Mike: Yeah.

Neil: We're definitely getting calls on a regular basis from various artists and their representatives basically saying 'what do you guys want us to do to help?'

GW: Aw, that's great, now what about the venues?

Neil: What about them?

GW: How do they-is that the same kind of thing or are they in trickier water?

Neil: Ah-

GW: Like, do you get any indications from them?

Mike: Venues and Promoters love working with us, because we're one of the few bands where we'll go in and we'll give them the tools, we'll go in and sell all the tickets! The String Cheese Incident is one of the greatest bands on the planet to work with, because we're willing to assume most of the responsibility on making the show successful ourselves--

GW: But haven't the promoter's hands been tied by these contracts with TicketMaster?

Mike: Absolutely.

GW: How long are these contracts? Do we know?

Neil: We don't know exactly, there's a range. I mean, what we've gathered from the investigation we've done so far is that these contracts can run anywhere from 3 years in length to 10 years in length. I think the average is somewhere around 5-7 years.

GW: Is it a catch 22? Where the contract runs out, what you're doing, let's take a slide in time right now, hasn't gathered enough steam to protect the venue, so their gonna resign to stay alive?

Neil: I think there are a lot of complicated reasons why venues and promoters might or might not renew their TicketMaster contract, but we really are just at the beginning of this and we haven't started taking discovery yet so--

GW: right--

Neil: I suspect that for different promoters and different venues there might have different sets of reasons.

Mike: I think it's also important to mention that TicketMaster wasn't always the evil empire. You know there was a time when their technology was truly superior to anything else that was out there, and the service they provided was better than anything else out there. The charges that they applied were actually relatively fair and reasonable. And what we feel has happened is that as they become more and more powerful and their monopolies become more and more consolidated that's how things have gotten completely out of hand. That combined with the fact that a bunch of folks like us in Boulder can figure out how to build a fully functioning, a viable system, with very little… anything, you have to believe that the venues and other entities will wake one morning and go: 'wow, whereas TicketMaster used to be super critical, it just really isn't any more.'

Neil: Yeah, I should add, too, that we're not really looking to replace TicketMaster, we're not looking to snatch up all kinds of exclusive deals with venues. I mean that's not really what SCI Ticketing does. What SCI Ticketing does is works with artists, and artist's different communities of fans and tries to provide the artist with the tools necessary to deliver to the fans tickets at a fair price with a really high quality level of service. There's still gonna be room in the world for other service providers I don't know if it's TicketMaster or if its somebody else that comes along with the better mouse trap to provide other kinds of services to the venues that were not really looking to do.

GW: When I first heard Madison House was challenging TicketMaster, the first thing I thought in my head was, "Well of course, you can sell tickets on line, I mean it's just, it's one of those paradigms where we, I feel I was lulled to sleep by TicketMaster and I didn't think about buying them for decades and then suddenly you go to your site it's all there and I know how to use the internet and I wonder how many other paradigms are out there like that, where we're still using technology from 30 years ago which is like ancient history with the internet.

Mike: Do you drive a car that uses regular gasoline?

Neil: Or how about our electrical grid?

Mike: I think the world is fraught with very obvious examples of better ways that we all, that if everyone looked, and were presented with the very basic fact, the fact that we still use gas to run our cars is absolutely unbelievable, yet I do it, I have an SUV, and it's crazy--

GW: I was reading how Realtors, the old MLS listing, I remember the MLS when I was a kid, realtors would get a book as big as a tree, you know every quarter, and now people are saying we can list on line.

Neil: They can, but that-it's interesting that you raise that one, because there have been, over the last couple of years some challenges, because the realtors are still trying to control all of the multiple listing services, even though, like you said, pretty much anybody could set one up online.

GW: Well it's a, it again goes to the whole paradigm, and then, but then now you've got to go into the legal courts, and do the-- does the legal court look at our society as is? Does it take slice of life as it's happening?

Neil: Yeah, the courts tend to have a pretty narrow frame of reference. I mean when you go in with a particular case like this one, it would be really unusual-if not unprecedented - for the court to be taking a look at society as a whole. I mean it's really just going to look at this incredibly narrow slice which is, you know, our dispute, and the way we framed the dispute, and that's kind of, you know everything else is going to have blinders with respect to anything else.

GW: Is this going to be public? The Case? In terms of… Will you be releasing statements from the case?

Neil: The case will probably be in some respects public and in some respects not, I mean, you know we live in an open society and the fall back rule is that cases like this are supposed to be tried in public, and the public and the media are supposed to have full access…But the reality is that when you get into lawsuits like this, there are times when one party or the other will say, 'well wait a second, some of what is going to be at issue here, that's going to get scrutinized is really highly confidential proprietary information, and it could involve trade secrets, we don't want our competitors to get a hold of it' That sort of thing, and it's not uncommon for courts to enter protective orders that in part prevent some of the nitty gritty facts from getting out there in the public. I can't predict how that will shake out in this case just because it's way too early.

GW: I'm gonna ask you a question from one of our browsers, his name is "Bennyboy" from Sacramento. And his question is: 'If SCI and Madison House is suing TicketMaster, how come the band is still playing venues that are contracted with TicketMaster? What would SCI/MH Like to have happen as an eventual outcome of the legal situation with TicketMaster?'

Mike: That speaks, the question speaks exactly to the heart of the problem, which is The String Cheese Incident needs to tour, and in most situations, the appropriate place for them to be playing is controlled by, you know, governed by a TicketMaster contract. So we take alternate routes whenever we can, and there's a lot of facets to this band: There is a very BIG picture is going on, which is we can't put our kids, or the fans in dangerous positions, the band has to play in the best possible places, considering what the circumstances are.

GW: He actually does ask as a third question, "Do you think you will be shut out of performing in TicketMaster venues as the case continues. Thanks and lots of luck with the suit, we love your stance."

Mike: No, they, TicketMaster? We're nothing but money for them. Because even in our ideal world where we hypothetically sell half the house, by us playing in a TicketMaster venue - they still get to sell half the house. You know, if we get pushed completely out, which is I guess very possible, they'll get zero percent of nothing, which isn't good for anyone.

GW: I have another one, Christopher Ezell, of Tuscaloosa, Alabama: "If SCI wins the lawsuit, will SCI fans and fans of other bands see a decrease in ticket prices?"

Neil: That's very hard to predict. It all depends upon…you know , it depends at least in part upon what we actually win at the end of the day. I think if we achieve what were asking for, at least the fans of artists that use SCI ticketing probably won't get shut out of as many shows; they'll have more of an opportunity to buy tickets from SCI Ticketing because the allotments will be bigger. How that translates in terms of the overall market for tickets to popular music concerts I have no idea. I mean TicketMaster is still going to be out there.

GW: Jason Baviano of Cleveland Ohio: What has been your biggest challenge in growing to the successful size organization Madison House is today?

Mike: What's been the most difficult part? Is that what the question is?

GW: Yeah, What has been your biggest challenge in growing to the successful size organization Madison House is today? What's been your biggest challenge?

Mike: I think the biggest challenge is just stay true to some sort of vision of having integrity and not believing the rules you know. Music is kind of like the wild west was at one point, where the rules that for years and years and years governed the system are no longer truly applicable, so it's been our challenge and also what's probably led us to I guess where we are today, has been our ability to say 'Just because it's been done like this forever doesn't mean it has to continue on like that forever.'

GW: It does seem to be just the pursuit of common sense.

Jason: Yes, and its easy to get beat down by these folks, and you struggle to make sure you not being complacent, and maintaining your edge and thinking outside of the box.

GW: Well, this is going to be a fascinating fight, and we really appreciate the time that you've given us to help explain it. There's a lot of issues and we're going to be posting some of the articles from newspapers to help people absorb this, because I think it does affect everyone, not just in the ticket realm, but as we talked about in the larger picture of things… Is there anything that you gentlemen would like to add or feel that hasn't been said?

Mike: I'd like to say the Grateful Dead has been a tremendous inspiration on a lot of levels for everything we do, I think both musically and business wise and I know that its been a very long road for them, with a lot of ups and downs, and the fact that they've been able to maintain as a viable musical force, is inspirational in a lot of ways.

GW: Well I can't agree more, I think the open taping is a paradigm that the money makers haven't really figured out--

Mike: Funny you mention that, we're about to start releasing live copies of our shows in real-time, immediately after the show happens, to help, you know, if you want to have the experience of taping without having to go through the craziness of what it means to be a taper.

GW: Wow, that's fantastic…

Mike: Yeah, we start with that with Vegas this weekend (note: 11/1/03)

GW: Well, I hope that we can meet again and talk about fun things.

Mike: Yep.

GW: Cause really it should be about that; after the battle and the smoke has cleared it should just be a really fun ride.

Mike: I just think if you can help spread the word as much as possible about what we're going through. The more voices and thoughts going out this way I think will be good for everyone, even if we don't ultimately succeed, someone will pick up this ball and run with it.

GW: It's our pleasure. It's definitely what we're about here. We definitely want to spread the word on this - it's a great case, and you guys have a lot of moxie---

Mike: Yeah really--

GW: --to do this-

Mike: -- to be honest, the real reason that this has happened more a product of Neil and his commitment and vision to this project more then anything, because without what he has brought to the table, we would not be having this conversation today, without a doubt.

GW: Well, Neil, thank you for bringing some light to this-

Neil: You're welcome.

GW: --its like your bringing light to a dark room.

Neil: Glad to try and shed some light.

GW: Well, thanks again so much; it's www.madisonhouseinc.com, right? Your URL?

Mike: Yeah.

GW: Madisonhouseinc.com, and we will be talking again, and good luck in your fight.

ALL: Thanks.

FIN.

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Editor update: Ticketmaster class action lawsuit for selling no view seats (added to this article 10/2004)