If you did not get the chance, please check out our first blog post “The Event Ticketing Industry is Broken and in Need of Disruption”, where we explain how we see the event ticketing industry, why its broken, and how we can change it. In a nutshell, Aventus aims to solve the following 3 problems:
1. The resale of bulk bought tickets at inflated prices on secondary markets.
Secondary ticket markets are controversial because they enable touts to buy up tickets from primary markets quickly and re-sell them on average 49% above face value with margins often exceeding 1000% , prohibiting price-sensitive fans from attending an event. Adele and other major artists have protested, banning the resale of their tickets after prices have appeared at up to £9000 on Stubhub . Additionally, in the U.K. it is illegal for football tickets to be resold without the club’s permission . However, such attempts at regulation have been futile, since ticket black markets continue to form anyway .
2. Counterfeit tickets.
The U.K. Metropolitan Police’s 2 year study of ticket fraud associated with the London 2012 Olympic games elucidated that organised crime networks were able to generate over £40m per year through the creation of counterfeit tickets . Furthermore, an investigation by the Telegraph showed that Brits wasted over £5m on counterfeit tickets advertised on social media in 2015 .
3. Maximising ticket sales to the event’s target audience.
According to Sean Moriarty, CEO of TicketMaster, “nearly 35% of ticket inventory goes unsold, and if you ask fans why they didn’t go to shows, one of the most popular reasons is ’I didn’t know about it’” . Furthermore, 60% of 16–24 year old concert and festival goers stated that they would go more regularly if tickets were less expensive . This indicates that promoters have difficulty reaching target audiences and that this problem is further aggravated by inflated prices.
Aventus is a blockchain-based protocol that creates a more fair, secure, and transparent event ticketing industry, practically eliminating counterfeit tickets and unfair touting. Organisers can create, manage and promote their events and associated tickets with dramatically reduced platform costs, and can even control secondary markets.
It solves the aforementioned problems in the following manner:
Secondary Market Control
At the core of the Aventus solution is a model where off-blockchain transactions of tickets are prevented. By ensuring that sales occur through the platform, event organisers can reliably enforce resale price minima and maxima, and even receive a portion of secondary sales revenue.
The solution is twofold:
- Tickets have an associated photo with them: This can be the owner’s face, identity document or credit card and is added at the point of purchase. Changes to the identity can only occur if the ticket is resold through a secondary market utilising the Aventus solution. The physical item photographed will be checked at the event and compared to that on the blockchain to grant entry.
- Owners reselling their tickets do not know who they are selling to: Tickets are put up for sale and all network participants can register an intent to purchase. Matching is then performed by network participants every so often to allocated tickets to interested buyers in a pseudo-random fashion.
Each ticket has a unique identifier and due to the blockchain’s immutable properties, once the event organisers have set up tickets no counterfeits can be created. Due to the transparency of the Blockchain, any user can check the validity of a ticket immediately. If the event itself is fraudulent, Aventus’ economic model incentivises network participants to report it and subsequently determine its validity using a decentralised consensus mechanism.
Promotion and Platform Cost Reduction
There are two key ways in which Aventus will cause events to reach a wider and more targeted audience:
- All events listed on the Aventus protocol will be accessible to any application using it (unless forbidden by the organisers), forming a global, open pool of events whose tickets can be sold by any application, incentivised via a commission on each sale. This destroys the current siloed nature of the industry and encourages multiple participation to drive more sales.
- Event organisers can reward promoters with a commission on ticket sales they make. Note, promoters can be listing apps and/or individuals who help make ticket sales via these apps. Their commissions can be as dynamic and complex as desired, since each promoter can receive a different commission based calculations of reputation.
The competition between listing apps and reduced fees due to blockchain micro-transactions and state channels should make overall ticket prices lower.
The Aventus Ecosystem Structure
The Aventus ecosystem is comprised of 3 main layers, as depicted in figure 1: the protocol, the service layer, and the application layer.
This layer is entirely composed of Ethereum smart contracts that allow for the creation and validation of events, the issuance and sale of tickets in primary and secondary ticket markets (customisable by the event organisers), and the distribution of ticket sale revenue and market/event fees between the event organisers, ticket promoters, market matchers, attendees, etc. There will be no fees for using these contracts so that the protocol can remain competitive and enjoy maximal adoption.
Services available here are aimed to make using the protocol as efficient and easy to use as possible, especially for developers looking to build mainstream ticketing applications.
Tools will include:
- An Ethereum account management platform where users with minimal cryptocurrency knowledge can have their accounts, funds, and transactions managed on their behalf.
- A fiat to AVT conversion mechanism so that users can buy tickets easily, and so event organisers and app developers can cash out quickly if necessary to avoid currency risk.
- A ticket and ID validation service where attendees’ faces will be scanned and compared to photos uploaded at point of purchase using machine vision. This will reduce entry fraud at events and allow organisers to track the performance of bouncers.
- Template user interfaces and integration tools that further lowers the barrier to entry to creating a customised ticketing interface for event organisers (e.g. a football club) or promoters (e.g. an influencer).
Others worth mentioning include in-event advertising tools and reputation calculations for promoters with respect to sales generated in previous, similar events. More services will be added over time depending on demand.
Although developers using these services will incur an additional cost, such tools will make building ticketing applications significantly easier especially with respect to onboarding mainstream users.
The final level consists of applications that build on top of the services layer (or in some cases just the protocol layer).
The Aventus system creates a global, open pool of events that can be accessed by any application using it, and any application can receive a commission for selling tickets for a given event. Hence, more apps built on the protocol ultimately benefits the event organisers since it results in more ticket sales.
Since the Aventus solution fixes sources of fraud prevalent across the entire event ticketing industry, we expect apps in a variety of sectors including cinema, theatre, music/festivals, and sports. There could be apps targeting even more specific sectors than these, such as Premiere League Football, that provide tailored benefits to attendees and hosts based on characteristics of their niche communities.
Further, we will encourage existing event-hosting companies such as sports teams and music festivals to leverage tools in the Aventus system to create their own secure ticketing store-fronts, bypassing the inflated 15–20% per-ticket fees that existing industry leaders charge.
We expect these applications to be primarily front-ends with minimal custom backend functionality, and to charge additional fees or use other revenue models such as advertising.
The Aventus team will create and launch the first ticket sales application in the sports and music industry. It will allow for the creation and management of events and associated tickets, along with the creation of promotional schemes for encouraging more ticket sales. Further, it will enable ticket buyers to receive rewards and find new events to attend easily. It should also be noted that Aventus will concentrate efforts on working with third party developers to support the creation of other applications on top of the services layer.
This post briefly highlights the problems in the event ticketing industry, along with the solution we at Aventus have attempted to tackle the industry with. We will be releasing our technical white paper in less than a week, so stay tuned.