Ticketing
Page: 5
Sens. Richard Blumenthal (D-CT) and Sheldon Whitehouse (D-RI) responded to President Joe Biden’s calls for fairness and transparency in ticketing fees by introducing the Junk Fee Prevention Act on Wednesday (March 22). While the proposed legislation goes beyond live music, it would transform how concert tickets are sold and attempts to reduce fees that inflate tickets’ face values.
“Concealed surprise fees — nickel and diming Americans to distraction — must be stopped,” Blumenthal said in a statement.
“Consumers are charged hidden fees when purchasing everything from flights to concert tickets,” added Whitehouse. “Our Junk Fee Prevention Act would provide consumers with the transparency they deserve when making a purchase.”
Biden urged Congress to pass legislation addressing “junk fees” during his Feb. 7 State of the Union address, pledging to cap fees on concert tickets and make companies disclose all-in prices upfront. “Americans are tired of being played for suckers,” he said. “Pass the Junk Fee Prevention Act so companies stop ripping us off.”
Blumenthal and Whitehouse’s proposed legislation would at least improve transparency. Ticketing companies would be required to “clearly and conspicuously” display the total price of a ticket with all fees included “in each advertisement and when a price is first shown to a consumer.”
While the legislation targets concert ticket fees and some re-sale tactics, it’s more than a reaction to Taylor Swift’s botched Eras Tour presale that prompted a Senate hearing on Ticketmaster’s business practices. The Junk Fee Prevention Act seeks to prevent companies from applying or advertising “any mandatory fees that are excessive or deceptive” for any good or service. It also targets fees for airline tickets and short-term housing such as hotels and vacation rentals, and would require airlines to seat parents next to their young children.
Transparency is a key theme of the Junk Fee Prevention Act. It includes a requirement to disclose the total number of tickets being offered for a concert, theater event, sporting event or other events “at a place of public amusement of any kind.” Both lawmakers and consumers have long complained that many concert tickets are held back for fan clubs, commercial partners like credit card companies and VIP packages.
Many of the changes sought in the Junk Fee Prevention Act are also found in the FAIR Ticketing Reforms, a set of “common sense” measures introduced on March 8 by a group of leading music companies including Live Nation, Universal Music Group and Red Light Management. FAIR Ticketing Reforms also calls for an end to speculative selling on secondary markets and mandatory all-in pricing. Unlike the Junk Fee Prevention Act, FAIR Ticketing Reforms also calls for stricter measures against automated bots and policing and fining resale sites that serve as a safe haven for scalpers.
Any person who violates the Junk Fee Prevention Act would be subject to the penalties of the Federal Trade Commission Act. A state attorney general can also bring a civil action if a violation affects residents of that state. In determining whether a fee is excessive, the bill asks the Federal Trade Commission or court to consider whether the fee is “reasonable and proportional” to the cost of a ticket and the reason for the fee. The FTC or court can also consider “any other factors determined appropriate.”
A mandatory fee is defined as any fee required to purchase a ticket, is not “reasonably avoidable,” is not expected to be included by a “reasonable consumer” or “any other fee or surcharge determined appropriate” by the FTC. Within 180 days of the bill’s enactment, the FTC would commence a rule making proceeding to consider whether and how the Federal Communications Commission should require disclosure of mandatory fees or prohibit companies from charging mandatory fees.
The country’s two leading concert companies, Live Nation and AEG, are at odds over how Congress should address the future of ticketing after a disagreement over Taylor Swift’s record-breaking The Eras Tour.
Long before the pop star’s Nov. 15 sale dominated the news cycle, where hundreds of thousands of Swift fans experienced service disruptions that kept them from buying the tickets they wanted, the two companies had signed an agreement that many thought might take AEG out of the ticketing business entirely. In 2021, when AEG announced that its facility management division ASM had struck a deal to make Ticketmaster its preferred ticketing partner, many assumed that meant the company was on the way to shutting down its own ticking platform, AXS Tickets.
Instead, ASM’s contract with the Live Nation-owned Ticketmaster would pave the way for an expansion of AEG’s AXS, thanks to a provision in Ticketmaster’s exclusive agreement that granted AEG the right to use AXS to sell tickets to AEG-promoted shows at ASM venues, sources tell Billboard. AEG tours like Kane Brown, Elton John and Luke Combs could opt out of using Ticketmaster when playing ASM-client venues such as Soldier Field in Chicago, U.S. Bank Stadium in Minneapolis and Desert Diamond Arena in Glendale, Ariz., and use AXS instead. This marked the largest carve-out in Ticketmaster’s exclusivity contract to date, potentially allowing hundreds of arenas, stadiums and performing arts centers to use AXS for the first time, like the new Allegiant Stadium in Las Vegas — the highest grossing stadium on Billboard’s 2022 year-end Boxscore chart.
The provision was a sort of double victory for AEG, Live Nation’s leading competitor: The company was able to leverage its control over 350 ASM venues to get those clients large payouts for re-signing with Ticketmaster without forsaking its own ticketing service. AEG officials had also hoped this might mark the beginning of a more open ticketing ecosystem away from the sorts of exclusive deals that have helped Ticketmaster gain such dominance in the space. But less than two years later, AEG and Live Nation find themselves at odds, divided over the handling of Swift’s The Eras Tour.
AEG is now refusing to join a coalition of music companies supporting Live Nation’s Fair Ticketing campaign, a piece of proposed anti-scalper legislation born out of the bot attack on Ticketmaster’s Nov. 15 presale for Swift’s tour. While Universal Music Group, Red Light Management, Irving and Jeffrey Azoff, and all four major talent agencies are backing the FAIR Ticketing reforms to ban scalping practices like “speculative” ticket selling and mandating all-in pricing across all ticketing marketplaces nationally, AEG has been taking a different approach to what they see as some of ticketing’s biggest problems. Sources tell Billboard that AEG executives have been quietly lobbying the Department of Justice to investigate Ticketmaster’s use of exclusive ticketing contracts to lock up the ticket market as a possible violation of its consent decree governing its merger with Live Nation in 2010. AEG leadership is also lobbying politicians to include restrictions on such exclusive ticketing practices in new legislation that could be introduced as soon as this week.
Sources say Live Nation executives have been careful not to engage with AEG publicly about its exclusivity agreements. Privately, they have accused AEG of trying to have it both ways, accepting the money that comes with exclusive ticketing contracts, while trying to expand AXS ticketing beyond the ASM deal into all NFL stadiums ticketed by Ticketmaster.
“This is a bad look for them,” one source at Ticketmaster tells Billboard.
Since Live Nation merged with Ticketmaster in 2010 and AEG launched its own ticketing platform in 2012, both companies have found they can earn more from the concerts they promote if they also control the ticketing, collecting more fees for themselves, while keeping data generated by the concert in house. The additional revenue for a promoter like AEG could be substantial, especially for an artist like Swift, who sold a total of 2.4 million tickets for The Eras Tour.
With Swift’s tour, sources say AXS was expecting to handle some of the ticketing under the ASM-Ticketmaster provision, since AEG was a co-promoter with partner Messina Touring Group. ASM managed five stadiums, representing 12 shows on the 52-date trek, and sources say AXS officials were hoping its ties to the tour could lead to it getting some, if not all of the tour. Except that Ticketmaster executives said their exclusive contracts with more than a dozen NFL teams (and the venues they own) superseded AXS’ claim. Under that reading of the deal, two of the 12 ASM dates — a pair of concerts at State Farm Stadium in Glendale, Ariz. — would be ticketed by SeatGeek under its exclusive deal with the Arizona Cardinals. Making matters worse, two of ASM’s management clients decided to partner with Ticketmaster for the sale.
Down to just five shows at two stadiums, AEG dropped the matter. According to a source, AEG executives have since spoken with the Department of Justice, encouraging them to look at Live Nation and Ticketmaster’s use of exclusive contracts as anti-competitive.
Relations only worsened in the days following The Eras Tour presale. After the fiasco, Live Nation chairman Greg Maffei appeared on CNBC to defend Ticketmaster and cited the company’s arrangement with AEG in response to claims of monopolistic behavior. “AEG, who is the promoter for Taylor Swift, chose to use us because, in reality, we are the largest and most effective ticket seller in the world,” he said. “Even our competitors want to come on our platform.” AEG leadership was quick to respond with a statement, saying the promoter had no choice but to use Ticketmaster. “Ticketmaster’s exclusive deals with the vast majority of venues on The Eras Tour required us to ticket through their system,” an AEG spokesperson said. “We didn’t have a choice.”
AEG hopes its private lobbying of politicians and anti-trust officials will lead to regulatory change that could include abolishing exclusive ticketing contracts in the United States and ultimately move toward an industry more similar to Europe, where promoters generally don’t sign exclusive ticketing deals and work with multiple partners to sell tickets.
Despite the disagreement, the ASM-Ticketmaster deal remains in place, and AEG officials have had success convincing buildings like the Greek Theater in Los Angeles and the Quicken Home Arena in Cleveland to avoid exclusive ticketing agreements and remain open to multiple systems.
Live Nation and AEG declined to comment for this story.
After warning fans in a tweet spree earlier this week that Ticketmaster’s “Verified Fan” system was “far from perfect,” The Cure singer Robert Smith continued his Twitter rant on Thursday after his band’s 30-date Shows of a Lost World North American tour went on sale.
“I AM AS SICKENED AS YOU ALL ARE BY TODAY’S TICKETMASTER ‘FEES’ DEBACLE,” Smith raged in his latest all-caps broadside against Ticketmaster. “TO BE VERY CLEAR: THE ARTIST HAS NO WAY TO LIMIT THEM. I HAVE BEEN ASKING HOW THEY ARE JUSTIFIED. IF I GET ANYTHING COHERENT BY WAY OF AN ANSWER I WILL LET YOU ALL KNOW.”
Smith’s tweet came as fans complained that despite the band offering reasonably priced tickets for the outing and making sure the tickets will be non-transferable to minimize resale and keep prices at face value, in some cases the added-on service fees, facility charges and order processing fees added up to more than the cost of entry.
By making the tickets non-transferable, scalpers will be unable to purchase tickets and then resell them for a profit since the original owner will have to be present to enter the venue. For fans who purchase tickets but can’t make it to the event, they will be able to resell the ticket on a face-value ticket exchange.
Before the VF onsale, Smith assured fans that he was doing everything he could to alleviate ticketing pain points, including avoiding platinum packages and dynamic pricing, referring to those practices as “a bit of a scam.” But when he saw the complaints about the service charges during Thursday’s onsale, the singer could not hold back; at press time a spokesperson for Ticketmaster had not returned Billboard‘s request for comment.
Following up on his “scam” tweet, on Wednesday (March 15), Smith explained, “I HAD A SEPARATE CONVERSATION ABOUT ‘PLATINUM’, TO SEE IF I HAD MISUNDERSTOOD SOMETHING… BUT I HADN’T! IT IS A GREEDY SCAM – AND ALL ARTISTS HAVE THE CHOICE NOT TO PARTICIPATE… IF NO ARTISTS PARTICIPATED, IT WOULD CEASE TO EXIST.”
If nothing else, Smith implored his fans to avoid buying tickets secondhand from scalpers, writing, “I HAVE BEEN TOLD: StubHub has pulled listings in all markets except NY, Chicago, Denver (IE. CITIES IN STATES THAT HAVE LAWS PROTECTING SCALPERS). PLEASE DON’T BUY FROM THE SCALPERS – THERE ARE STILL TICKETS AVAILABLE – IT IS JUST A VERY SLOW PROCESS… I WILL BE BACK IF I GET ANYTHING SERIOUS ON THE TM FEES… IN THE MEANTIME, I AM COMPELLED TO NOTE DOWN MY OBVIOUS RECURRING ELEPHANT IN THE ROOM THOUGHT… THAT IF NO-ONE BOUGHT FROM SCALPERS… THEN.”
The Cure’s efforts to combat resale ticketing comes after a season of in-demand tours facing astronomical price increases due to dynamic ticketing and scalpers. Ticketmaster is currently facing government inquiries into its handling of the disastrous Taylor Swift Eras Tour presale, which left many fans outraged when service delays and website crashes (caused in part by bots) prevented many of them from securing tickets.
See Smith’s tweets below.
I AM AS SICKENED AS YOU ALL ARE BY TODAY’S TICKETMASTER ‘FEES’ DEBACLE. TO BE VERY CLEAR: THE ARTIST HAS NO WAY TO LIMIT THEM. I HAVE BEEN ASKING HOW THEY ARE JUSTIFIED. IF I GET ANYTHING COHERENT BY WAY OF AN ANSWER I WILL LET YOU ALL KNOW. X— ROBERT SMITH (@RobertSmith) March 16, 2023
WHAT I MEANT BY THIS BIT WAS… I HAD A SEPARATE CONVERSATION ABOUT ‘PLATINUM’, TO SEE IF I HAD MISUNDERSTOOD SOMETHING… BUT I HADN’T! IT IS A GREEDY SCAM – AND ALL ARTISTS HAVE THE CHOICE NOT TO PARTICIPATE… IF NO ARTISTS PARTICIPATED, IT WOULD CEASE TO EXIST X https://t.co/Kj7hjkRGn1— ROBERT SMITH (@RobertSmith) March 15, 2023
I HAVE BEEN TOLD: StubHub has pulled listings in all markets except NY, Chicago, Denver (IE. CITIES IN STATES THAT HAVE LAWS PROTECTING SCALPERS). PLEASE DON’T BUY FROM THE SCALPERS – THERE ARE STILL TICKETS AVAILABLE – IT IS JUST A VERY SLOW PROCESS… X— ROBERT SMITH (@RobertSmith) March 16, 2023
Robert Smith is explaining the serious measures The Cure is taking to avoid outrageous ticket prices for their upcoming North American tour. In a shot across the bow at re-sellers, when the tickets for the 30-date run of Shows of a Lost World Tour went on sale Wednesday morning (March 15) to those who pre-registered using Ticketmaster’s Verified Fan system, will be non-transferrable in order to minimize resale and keep prices at face value.
The singer went on a tweet spree on Tuesday (March 14) in which he explicitly described how and why the veteran goth rockers decided to go their own way on this outing. “TM HAVE JUST TOLD ME ‘ALL tickets for The Cure Shows Of A Lost World Tour will be made available during tomorrow’s Verified Fan Sale,’” Smith tweeted, adding, “SEEMS THE RESPONSE TO REGISTRATION HAS BEEN PRETTY OVERWHELMING – THANKS! HOWEVER, I REALISE THERE ARE PROBLEMS, SOME MORE REAL THAN OTHERS…”
He then noted that the group had “final say” in all the ticket pricing for the tour, with Smith determined that those prices would not be “INSTANTLY AND HORRIBLY DISTORTED BY RESALE.” Smith referred to touts as being part of a “sophisticated business” expert at acquiring tickets and reselling them on marketplaces such as Vivid, Stubhub and Seatgeek.
Smith also revealed that the Cure were told that TM’s Verified Fan platform “has been used more than 400 times to qualify buyers and reduced the % of tickets on the secondary market” and that using VF has regularly reduced scalping by 80%, with less than 5% of tickets typically ending up on the secondary market.
By making the tickets non-transferable, scalpers will be unable to purchase tickets and then resell them for a profit since the original owner will have to be present to enter the venue. For fans who purchase tickets but can’t make it to the event, they will be able to resell the ticket on a face-value ticket exchange.
“WE WERE CONVINCED THAT TICKETMASTER’S ‘Verified Fan Page’ AND ‘Face Value Ticket Exchange’ IDEAS COULD HELP US FIGHT THE SCALPERS,” Smith wrote. “(WE DIDN’T AGREE TO THE ‘DYNAMIC PRICING’ / ‘PRICE SURGING’ / ‘PLATINUM TICKET’ THING… BECAUSE IT IS ITSELF A BIT OF A SCAM? A SEPARATE CONVERSATION!).”
When the band announced the world tour earlier this week, they established that “there will be no ‘Platinum’ or ‘Dynamically Priced’ tickets on this tour,” which includes stops at Hollywood Bowl in Los Angeles, Moody Center in Austin, Madison Square Garden in New York and State Farm Arena in Atlanta.
The singer also tweeted that though TM’s Verified Fan is a “far from perfect system,” the reality is that if there aren’t enough tickets on sale, some fans will miss out no matter what system the Cure use. “At least this one tries to get tickets into the hands of fans at a fair price,” he said. In the final comment in the Twitter run, Smith noted he’d been told that TM will continued to sell tickets to Verified users “until there are no more tickets to sell.”
The Cure’s efforts to combat resale ticketing comes after a season of in-demand tours facing astronomical price increases due to dynamic ticketing and scalpers. Ticketmaster is currently facing government inquiries into its handling of the disastrous Taylor Swift Eras Tour presale, which left many fans outraged when service delays and website crashes (caused in part by bots) prevented many of them from securing tickets.
See Smith’s tweets below.
TM HAVE JUST TOLD ME “ALL tickets for The Cure Shows Of A Lost World Tour will be made available during tomorrow’s Verified Fan Sale” SEEMS THE RESPONSE TO REGISTRATION HAS BEEN PRETTY OVERWHELMING – THANKS! HOWEVER, I REALISE THERE ARE PROBLEMS, SOME MORE REAL THAN OTHERS…— ROBERT SMITH (@RobertSmith) March 15, 2023
WE HAD FINAL SAY IN ALL OUR TICKET PRICING FOR THIS UPCOMING TOUR, AND DIDN’T WANT THOSE PRICES INSTANTLY AND HORRIBLY DISTORTED BY RESALE – WE WERE TOLD “In North America the resale business is a multi-billion $ industry.— ROBERT SMITH (@RobertSmith) March 15, 2023
The touts are sophisticated businesses that are expert at acquiring tickets, and the major marketplaces like Vivid, Stubhub and Seatgeek spend tens of millions of dollars on marketing. The touts get an unfair share of tickets and resell them on these marketplaces.”— ROBERT SMITH (@RobertSmith) March 15, 2023
WE WERE TOLD “Ticketmaster’s Verified Fan platform has been used more than 400 times to qualify buyers and reduce the % of tickets on the secondary market.— ROBERT SMITH (@RobertSmith) March 15, 2023
Using Verified Fan scalping is regularly reduced by 80%, with typically fewer than 5% of tickets on the secondary market after a Verified Fan campaign. Listed below are a few of the artists who have effectively used VF to limit resale.”— ROBERT SMITH (@RobertSmith) March 15, 2023
WE WERE CONVINCED THAT TICKETMASTER’S “Verified Fan Page” AND “Face Value Ticket Exchange” IDEAS COULD HELP US FIGHT THE SCALPERS— ROBERT SMITH (@RobertSmith) March 15, 2023
(WE DIDN’T AGREE TO THE ‘DYNAMIC PRICING’ / ‘PRICE SURGING’ / ‘PLATINUM TICKET’ THING… BECAUSE IT IS ITSELF A BIT OF A SCAM? A SEPARATE CONVERSATION!)— ROBERT SMITH (@RobertSmith) March 15, 2023
WE KNOW IT IS A FAR FROM PERFECT SYSTEM – BUT THE REALITY IS THAT IF THERE AREN’T ENOUGH TICKETS ONSALE, A NUMBER OF FANS ARE GOING TO MISS OUT WHATEVER SYSTEM WE USE; AT LEAST THIS ONE TRIES TO GET TICKETS INTO THE HANDS OF FANS AT A FAIR PRICE…— ROBERT SMITH (@RobertSmith) March 15, 2023
The Cure is taking serious measures to avoid outrageous ticket prices for their upcoming tour dates. The band, which announced a 30-date run of shows earlier this week, took to social media Friday (March 10) to let fans (and scalpers) know that tickets for their Shows of a Lost World Tour dates will be non-transferable.
“We want the tour to be affordable for all fans, and we have a very wide (and we think very fair) range of pricing at every show,” the message said. “Our ticketing partners have agreed to help us stop scalpers from getting in the way; to help minimise resale and keep prices at face value, tickets for this tour will not be transferable.”
By making the tickets non-transferable, scalpers will be unable to purchase tickets and then resell them for a profit since the original owner will have to be present to enter the venue. For fans who purchase tickets but can’t make it to the event, they will be able to resell the ticket on a face-value ticket exchange.
Three states in the U.S. have outlawed non-transferable tickets, making it illegal for The Cure to uphold the practice for shows in New York, Illinois and Colorado. For those dates, the band encourages fans to only purchase tickets from face-value exchange platforms like Twickets and Cash or Trade.
“Fans should avoid buying tickets that are being resold at inflated prices by scalpers, and the sites that host these scalpers should refrain from reselling tickets for our shows,” the message reads.
The band went on to explain that any tickets listed as of today (March 10) on secondary ticketing sites are not legitimate. Scalpers will post tickets onto secondary ticketing platforms prior to a tour’s on-sale via a practice called speculative ticketing. When a fan pays for the “speculative ticket”, the scalper will acquire a ticket at a lower price once tickets actually go on sale and pocket the difference. The Cure has stated that they will work with Ticketmaster to cancel any tickets obtained via this method.
When the band announced the world tour earlier this week, they established that “there will be no ‘Platinum’ or ‘Dynamically Priced’ tickets on this tour,” which includes stops at Hollywood Bowl in Los Angeles, Moody Center in Austin, Madison Square Garden in New York and State Farm Arena in Atlanta.
Fans looking to secure tickets to The Cure’s 2023 tour should register with Ticketmaster’s Verified Fan program. Registration is open through Monday (March 13). After registering, fans will be entered into a lottery system to try to purchase tickets for their preferred date and location.
The Cure’s efforts to combat resale ticketing comes after a season of in-demand tours facing astronomical price increases due to dynamic ticketing and scalpers. Ticketmaster is currently facing government inquiries into its handling of the disastrous Taylor Swift Eras Tour presale, which left many fans outraged when service delays and website crashes (caused in part by bots) prevented many of them from securing tickets.
After weeks of strategizing how to salvage Ticketmaster’s reputation in the wake of last November’s Taylor Swift presale debacle and Live Nation president/CFO Joe Berchtold’s January grilling by the Senate Judiciary Committee, the ticketing giant’s parent company has settled on an approach that will ramp up lobbying to hit back at scalpers while educating consumers about ticketing fees.
Despite breaking two company records with the Nov. 15 The Eras Tour presale — the most tickets ever sold in a single day (2.4 million) and, according to the company, keeping 95% of those tickets off secondary sites like StubHub and SeatGeek — Ticketmaster found itself cast as the villain and Live Nation as a monopoly after a cyberattack disrupted over 100,000 transactions.
The outcry has led to a mixture of disbelief and self-reflection at Live Nation’s global headquarters in Beverly Hills, Calif. “The company enables music fans to connect with the world’s greatest artists through concerts and events that often become the cornerstone moments of people’s lives,” says a Live Nation executive who was not authorized to speak on the record. “Why the fuck do people hate us so much?”
Although the controversy over the Swift presale had to do with ticket availability rather than price — the prime complaint of Ticketmaster’s July 2022 Verified Fan sale of tickets to Bruce Springsteen’s 2023 tour — the executive says that Live Nation has determined that redeeming itself with consumers “starts with the fees,” which can add over 30% to the final price of a concert ticket.
“We’ve got to now go out and do a much better job so policymakers and consumers understand how the business operates,” Live Nation president/CEO Michael Rapino said during the company’s most recent investor call. “We’ve historically not had a big incentive to shout out loud that venues are charging high service fees or artist costs are expensive. But I think now [that] education is paramount.”
Ticketmaster’s main source of revenue comes from the fees it charges to process ticket transactions. A ticket’s face value goes to the artist, while the ticketing giant shares the fees it collects with the venues that contract for its services.
Ticketmaster typically keeps $2 to $5 per ticket for processing costs and a small portion of the fees it collects to recoup any loans, advances or bonuses it may have paid the venue to win its ticketing contract. Contracts for large venues can be worth millions of dollars. The balance of the fees collected goes to the venue, which uses the money to cover the cost of the show.
Traditionally, promoters book venues for artists, pay rent to use the space and hire its staff. What’s left over as profit is divvied up with the act, which typically receives 80% to 85% of that amount.
But as competition to book top-shelf headline talent has increased over the last decade, venues have reduced the rent they charge and promoters have agreed to take a smaller percentage of base ticket sales — sometimes as little as 5%.
As Rapino said on the investor call: “The artist takes most of that ticket fee base. So the way that the venue, the promoter or the ticketing company [earns its] revenue fees is through that extra fee.”
The increasing costs of concert production, which are borne by the promoter, have also wid- ened the gap between a ticket’s face value and the final amount charged after fees, which can induce sticker shock when two $100 tickets can end up costing $265. While it has been very profitable for Ticketmaster to cover more of a concert’s costs through these fees, it has helped turn ticket buyers against the company.
Ticketmaster executives are hoping a simple fix can solve the problem — showing the total cost of a ticket, face value plus fees, at the be- ginning of the checkout process. That method is already used in New York, where it is mandated by state law.
“We all want to know what is the true cost to see the show when we start shopping,” Rapino said on the call. “We wish that would be mandated tomorrow across the board [because] that would relieve a lot of the stress [and] the consumer’s perception that there’s this magical extra fee added on” that isn’t part of the overall show cost.
Ticketmaster and other ticketing companies have long debated whether to abandon what’s known as a “drip pricing” model but haven’t pulled the trigger because studies show that fans are more likely to make a purchase if the fees that are tacked onto the face value of a ticket don’t appear until checkout. Secondary-market ticketing companies have also adopted the practice, advertising tickets at prices below those sold on the primary market, then hitting consumers with a 35% to 45% markup at checkout.
In a move more closely tied to the Swift situation, Ticketmaster has also decided to target scalpers through legislation and proposed legislation called the FAIR Ticketing Act that would outlaw drip pricing and grant artists the ability to ban scalper websites from reselling their tour tickets. Support for the initiative includes all four major talent agencies, Universal Music Group and a number of management companies.
Pro-ticket scalping groups have proposed their own counter-legislation, effectively banning Ticketmaster from using its proprietary technology to stop scalpers. Neither bill has a congressional sponsor in either chamber of Congress, however, and unless that happens, neither has any chance of passing.
Ticketmaster does appear to have some serious muscle in its corner when it comes to the scalp- ing issue. In a February interview with Billboard, Gregg Perloff, founder and CEO of independent promoter Another Planet Entertainment, which produces San Francisco’s Outside Lands festival, said: “My question for [Congress] is, ‘Why are you picking on Ticketmaster and Live Nation when you should be outlawing brokers?’ They are the ones who screw up everything. Does every promoter take a few tickets? Does every venue have a few tickets? … Sure. But it’s the scalpers that make it so no one can get a decent seat except the rich. The Senate didn’t do the research they should have done before they started pontificating and acting like they knew what they were talking about.”
In addition, Perloff suggested that touring artists were partially responsible because they “really want to go on sale for the whole tour at once because they can advertise the whole tour at once and make a bigger splash.” Regarding Swift’s tour, he said, “There’s no system in the world — and this is where I have to defend Ticketmaster — that could have handled the onslaught.”
Also in February, at the Pollstar Live conference in Los Angeles, music mogul Irving Azoff and Madison Square Garden Entertainment chairman James Dolan took on pro-scalping journalist-podcaster Eric Fuller when he argued that scalping made tickets cheaper, citing discredited media reports of bargain bin-priced tickets available for Springsteen’s North American tour dates.
“It’s about a half-hour conversation, but you’re dead wrong,” Azoff told Fuller, who also operates a consulting business in ticketing.
“You got to take your hat off to this paid lobbying group that’s working for the scalpers,” Dolan chimed in. “These guys are pretty good. Maybe we should hire them.” In response, Fuller says Dolan’s comments are “grossly inaccurate.”
The Ledger is a weekly newsletter that covers the financial and economic side of the music business. An abridged version appears at Billboard Pro. Sign up here to receive the newsletter.
Ticket fees have been called everything from “exorbitant” (Sens. Richard Blumenthal and Amy Klobuchar) to “completely bats—” (Last Week Tonight with John Oliver). And they can increase the price of a concert ticket by an average of 27-31%, according to a 2017 study by the U.S. Government Accountability Office.
Unfortunately for ticket buyers, those fees aren’t going anywhere quickly. They may change or disappear completely, but consumers won’t reap any savings in the end, Live Nation CEO Michael Rapino explained during Live Nation’s fourth quarter 2022 earnings call on Thursday.
Say, for example, a venue is prohibited from charging fees on top of a ticket’s face value. “Well, then the venue would say, ‘Okay, artists, the rent isn’t $50,000 anymore. It’s $100,000,’” Rapino said.
The ticket fee is a surcharge that helps cover a venue’s costs. Rapino’s point is that the venue needs to cover its costs, so it’s going to collect money to cover them, no matter what. In a normal scenario, the consumer helps cover those costs by paying a surcharge directly to the venue.
If fees were eliminated, artists — who are the final authority on primary ticket prices — would be forced to raise them to cover the additional cost. The surcharge may have disappeared, but that cost would still exist in the form of a higher face value. Regardless of the approach, the consumer’s expense and the venue’s revenues would be unchanged.
“The true cost of going to a show and making the show happen is the full price all-in,” said Rapino. The concept is apparent to anybody who has pondered how airlines set prices. If airlines charged an all-in fee that encompassed all its costs, ticket prices would be dramatically higher. Legislation that banned fees for checked baggage could result in higher prices for everything from flight themselves to in-flight beverages. Airlines that previously allowed free carry-on bags might start imposing fees on those. They could also charge more to change your travel plans (which used to cost the consumer nothing).
Rapino acknowledged that Live Nation, which owns and operates venues, would do the same. “If tomorrow someone said, ‘You know, you can’t charge 20% service fees on your amphitheater, you have to [charge] 10%.’ Well, then the $75,000 house rent that we charge artists would be $100,000,” he said as an example. Live Nation couldn’t simply absorb the cost, he explained. Since the company requires money to pay staff and operate the venue, it would find a way to recoup the lost fees.
While what consumers pay won’t change, they may get more transparency. In the wake of Ticketmaster’s disastrous Taylor Swift Eras Tour pre-sale, President Joe Biden unveiled an initiative to limit, among other types of fees, mandatory, back-end fees that “often hide the full price” of a good or service. The White House pointed to research that found hiding the full price encourages consumers to spend more than they would have otherwise.
Live Nation has also come out publicly — and forcefully — against hidden fees. On Thursday, Rapino called numerous times for the industry to adopt all-in pricing that show the ticket buyer a single price at the beginning of the transaction. Also on Thursday, Live Nation issued a press release that encouraged lawmakers to introduce legislation that includes, among other things, mandatory all-in pricing.
The uproar against Live Nation and Ticketmaster over ticket fees is just one of many criticisms to gain momentum in recent months. Some members of Congress have called Live Nation a monopoly that limits competition in the touring business and harms consumers by charging high prices and leaving some unable to purchase tickets for in-demand concerts like Swift’s Eras tour. Many inside and outside of Washington have called for the Department of Justice to break up the company’s concert promotion and ticketing operations. On Thursday, Sens. Klobuchar and Mike Lee sent evidence of the Jan. 24 Senate hearing on the ticketing market to the Department of Justice and encouraged its antitrust division “to take action if it finds that Ticketmaster has walled itself off from competitive pressure at the expense of the industry and fans.” Others have suggested Ticketmaster improve its security practices to deal with the bot attacks that derailed Swift’s pre-sale.
Ticketmaster may be most reviled for its fees, though. And as Rapino pointed out, those aren’t going away anytime soon.
Live Nation’s 2022 was record-breaking across basically all key metrics — revenue, concert attendance, gross transaction value and sponsorships were all at all-time highs — and the company expects 2023 to top that.
As the company reported Thursday (Feb) with its fourth quarter earnings, total revenue reached a record $16.7 billion in 2022 — up 44% from the pre-pandemic era of 2019. That growth was spread across a number of factors: more fans, more concerts, more spending per fan, higher average ticket prices and a greater number of large sponsors.
Adjusted operating income improved 49% to $1.4 billion over the year, and operating free cash flow rose nearly four-fold to $1.8 billion.
Concert revenue in 2022 was $13.49 billion, up 43.1% from 2019 and 185.8% more than 2021. Concert attendance reached 121 million fans in 2022, up 24% from 2019 and a 246% increase from 2021, a year Live Nation began to recover from the pandemic but was not yet at full strength. The concerts division put on 43,600 events in 2022, up 153.2% from 2021 and up 8.4% from 2019. Attendance for Venue Nation, the venues operated by Live Nation, reached almost 50 million.
Ticketing revenues of $2.24 billion was up 44.9% from 2019 and up 97.4% from 2021. Fee-bearing ticket volume rose 28% from 2019 to 280 million. Fee-bearing gross transaction value grew to $28 billion, up more than 50% from 2019.
The average ticket costs were higher in 2022, too. With more tickets priced dynamically to true market value, Live Nation estimates $700 million was shifted to artists (and, presumably, away from the secondary market). That said, the average entry price for tickets remained below $35 in the U.S.
Even though consumers felt the pinch of high inflation throughout 2022, music fans didn’t shy away from spending money at Live Nation concerts. Ancillary per-fan spending rose at least 20% across all venue types from 2019 levels.
Sponsorship revenue reached $968 million, up 64% from 2019 and 135% greater than 2021. Live Nation had 120 large sponsors globally, up 32% from 2019. Last year, the company added PayPal, GoPuff, Hulu and Snap as sponsors. They and other new, large sponsors accounted for 80% of sponsorship’s revenue growth in 2022.
Live Nation points to a number of leading indicators that suggest 2023 will be even stronger than 2022. As of mid-February, event-related deferred revenue — tickets sales for concerts that have not yet occurred — was up $400 million to $2.7 billion. Also through mid-February, ticket sales are up 20% and fee-bearing gross transaction value of tickets sold is up 33%.
Just a week after Ticketmaster’s disastrous presale for Taylor Swift‘s The Eras Tour, Sens. Richard Blumenthal (D-CT) and Marsha Blackburn (R-TN) are asking the chair of the Federal Trade Commission (FTC) how the agency plans to combat bots in the online ticketing marketplace.
In a letter sent Monday (Nov. 28), Sens. Blumenthal and Blackburn — chair and ranking member of the Senate’s Subcommittee on Consumer Protection, Product Safety and Data Security, respectively — are requesting information from FTC chair Lina Khan about what steps the FTC is taking to enforce the 2016 law known as the Better Online Ticket Sales (BOTS) Act, which was designed to crack down on the kind of illegal bots that have plagued online ticket sales for recent tours by Swift and other major stars.
That law, which “prohibits the circumvention of a security measure, access control system, or other technological control measure used online by a ticket issuer” and the sale of tickets knowingly obtained through those means, grants the FTC and state attorneys general the authority to enforce violations, according to the letter. But since the BOTS Act became law, Blumenthal and Blackburn claim the FTC has taken only a single enforcement action despite numerous incidents involving the use of bots in online ticket sales.
“Given the numerous high-profile incidents in the online ticket marketplace, it would be helpful to understand how the FTC intends to act to address such conduct going forward,” the letter reads.
Monday’s letter follows Ticketmaster’s earlier claim that the Swift debacle was caused in part by tens of millions of uninvited users and billions of bots crashing the Eras presale, forcing the company to shut down the tour’s final onsale after more than 90% of ticketing inventory was snapped up.
In the wake of the fiasco, politicians including Sen. Amy Klobuchar — chair of the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights — and Rep. Alexandria Ocasio-Cortez suggested Ticketmaster and its owner Live Nation represent a monopoly and cried out for accountability, with the latter directly calling for the companies, which merged in 2010, to be broken up. Last week, Klobuchar and her counterpart on the Senate Judiciary Subcommittee, Sen. Mike Lee (R-UT), jointly announced they would be holding a hearing to examine the effects of consolidation on the ticketing industry. Live Nation and Ticketmaster are also reportedly under investigation by the Justice Department over whether the companies represent an illegal monopoly, though that probe is said to have predated the Swift incident.
In addition to the Swift debacle, in the letter Blumenthal and Blackburn point to various other recent online ticketing mishaps involving bots, including tours for Bob Dylan, Blake Shelton, Bruce Springsteen and Adele.
“While bots may not be the only reason for these problems, which Congress is evaluating, fighting bots is an important step in reducing consumer costs in the online ticketing industry,” the senators continued. They point out that the infiltration of bots, among other factors, creates an unfair environment that prevents regular fans from purchasing tickets, forcing them to resort to secondary sites where tickets are often marked up dramatically. “Some reports have found secondary ticket sales ranging from $1,000 (Bruce Springsteen) to $40,000 (Adele),” the lawmakers added.
Though Swift may benefit from Blackburn’s interest in addressing the ticketing bots issue, the two have not exactly gotten along in the past. The pop star made a rare-at-the-time political statement in 2018, denouncing Blackburn for her conservative voting record and urging voters to choose her opponent in the Senate race that year. She later called the lawmaker “Trump in a wig.” Last year, Blackburn addressed the tiff in an interview, arguing Swift would the “first victim” in a “socialistic government.”
In addition to asking whether the FTC has any “pending enforcement matters before it” with respect to the BOTS Act, Blumenthal and Blackburn are asking why only a single enforcement action has been taken to date; whether there are “obstacles preventing” the FTC from enforcing the law; and whether there are “other solutions that Congress needs to consider” to prevent bots from operating in the future.
You can read the full letter below.
Dear Chair Khan:
We write to ask for information about the steps the Federal Trade Commission (FTC) is taking to combat the use and operation of bots in the online ticket marketplace. As you know, the Better Online Ticket Sales, or BOTS Act, became law in 2016. This law prohibits the circumvention of a security measure, access control system, or other technological control measure used online by a ticket issuer. It also prohibits the selling or offering of an event ticket obtained through a circumvention violation if the seller participated in, had the ability to control, or should have known about the violation. The BOTS Act gives the FTC and state attorneys general the authority to enforce violations as unfair and deceptive practices.
Recently, several high profile incidents arose where consumers encountered serious difficulties purchasing tickets through online ticket vendors, including Ticketmaster and AXS. While bots may not be the only reason for these problems, which Congress is evaluating, fighting bots is an important step in reducing consumer costs in the online ticketing industry. For example, consumers reported trying to purchase tickets to see Bob Dylan at the Ryman Auditorium in Nashville, only to be told the tickets in their shopping cart no longer existed. Similarly, 22,000 fans preregistered to buy tickets for Blake Shelton, but only a few hundred actually got tickets. Finally, Ticketmaster/LiveNation pointed to online bots as a reason why fans could not get Taylor Swift concert tickets, leading the ticket seller to shut down sales to the general public.
While some consumers opt to purchase tickets on the secondary market, most fans cannot afford to pay thousands of dollars for a single concert ticket. Some reports have found secondary ticket sales ranging from $1,000 (Bruce Springsteen) to $40,000 (Adele).3 Preventing this type of consumer harm is exactly why Congress chose to enact the BOTS Act six years ago and why we both chose to sponsor that bill.
We understand that, in January 2021, the FTC took its first enforcement actions under the BOTS Act. However, given the numerous high-profile incidents in the online ticket marketplace, it would be helpful to understand how the FTC intends to act to address such conduct going forward. We request answers to the following, which may be provided in a confidential briefing if needed:
Does the FTC have any pending enforcement matters before it with respect to the BOTS Act?
Why has the FTC only undertaken a single enforcement action to date using its BOTS Act authority?
Are there obstacles preventing the FTC from exercising its authority under the BOTS Act that Congress should be aware of?
Are there other solutions that Congress needs to consider in conjunction with the BOTS Act?
We appreciate your timely attention to this issue.
Sincerely,
Marsha BlackburnRanking MemberSubcommittee on Consumer Protection, Product Safety, and Data Security
Richard BlumenthalChairSubcommittee on Consumer Protection, Product Safety, and Data Security
Some of Taylor Swift’s fans want you to know three things: They’re not still 16, they have careers and resources and, right now, they’re angry. That’s a powerful political motivator, researchers say.
Look what Ticketmaster made them do.
It started Nov. 15, when millions crowded a presale for Swift’s long-awaited Eras Tour, resulting in crashes, prolonged waits and frantic purchases. By Thursday, Ticketmaster had canceled the general sale, citing insufficient remaining tickets and inciting a firestorm of outrage from fans. Swift herself said the ordeal “really pisses me off.”
Ticketmaster apologized but the bad blood had already been sowed. And now fans — and politicians — have started acting on it.
U.S. Rep. Alexandria Ocasio-Cortez directed Swifties to where they could make U.S. Department of Justice complaints. Multiple state attorneys general — including in Pennsylvania and Tennessee, key states in Swift’s origin story — have announced investigations.
Stephanie Aly, a New York-based professional who has worked on community organizing for progressive politics, for years has thought mobilizing fandoms for social progress could be beneficial. “Fandoms are natural organizers,” said the 33-year-old Swiftie. “If you find the right issues and you activate them and engage them then you can effect real change.”
In 2020, for instance, K-pop fans organized to back the Black Lives Matter movement and sought to inflate registration for a Donald Trump rally. Aly and Swifties from different industries — law, public relations, cybersecurity and more — have joined forces to create Vigilante Legal, a group targeting Ticketmaster by creating email templates to petition attorneys general and providing antitrust information. Thousands have expressed interest in helping or learning more.
“The level of anger that you’ve just seen in the country around this issue is astounding,” said Jean Sinzdak, associate director for the Center for American Women and Politics at Rutgers University. “People are really sharing their feelings about that and building a movement about that online, which I really think is quite fascinating. It’s certainly an opportunity to engage people politically. Whether it lasts is hard to say, but it certainly feels like a real opportunity.”
In one way, said Sinzdak, this is giving Swift’s large following of younger people a direct line to seeing how policy takes shape. It’s also targeting a demographic that is seldom courted by politicians during election season.
“Nobody goes out and thinks, ‘Let’s target young women,’” said Gwen Nisbett, a University of North Texas professor who researches the intersection of political engagement and pop culture. “Be it about abortion or student loans, that age group is super mobilized and young women are super mobilized.”
Fan culture and community has boosted that tendency toward mobilization. Nisbett was studying parasocial relationships — when fans have strong one-way relationships with celebrities — in 2018, when the previously apolitical Swift posted an endorsement of Democratic candidates to social media. Nisbett found that while such posts may not determine fans’ votes, they still led to the increased likelihood fans would look for more information about voting — and actually vote.
For the record: AP VoteCast, an extensive survey of the U.S. electorate, showed about a third of Tennessee voters in 2018 said they had a favorable opinion of Swift, and among them, a large majority — about 7 in 10 — backed Democrat Phil Bredesen in the Senate contest. That was in clear contrast to the roughly third of voters who had an unfavorable opinion of Swift and overwhelmingly backed Republican Marsha Blackburn.
For Swifties, the ire for Ticketmaster is not just about a ticket: “It’s the fact that you can’t participate in your community and your fandom and it’s part of your identity,” Nisbett said.
This isn’t even the first time a fandom or an artist has targeted Ticketmaster. Pearl Jam took aim at the company in 1994, although the Justice Department ultimately declined to bring a case. More recently, Bruce Springsteen fans were enraged over high ticket costs because of the platform’s dynamic pricing system.
“It’s not just about getting vengeance for Swifties. It’s not about getting an extra million Taylor Swift fans tickets, or all of us going to a secret session,” said Jordan Burger, 28, who is using his law background to help the cause. “It’s about fundamental equality. And when you have a monopolist like that, it’s just so representative of the class structure of a society where there isn’t equality anymore, there isn’t fairness.”
The sheer power and size of Swift’s fandom has spurred conversations about economic inequality, merely symbolized by Ticketmaster. Aly noted that quite a few of the members of the group did get tickets; the issue is is bigger than Ticketmaster, she said.
“We’ve gotten some feedback that, ‘This is too big, let the government handle it.’ Have you seen the U.S. government? The government only functions when the people push it to and when the people demand that it function and the people are involved,” she said. “Even when something seems too big to fail or too powerful to fail, there are always enough of us to make a difference. Your involvement may be the thing that pushes it over the edge that forces the government to act.”
Aly says many grown-up Swifties have 10-15 years’ experience of being bullied for liking the singer — but what fans have in mind might be better than revenge.
“We have thick skin and nothing to lose, really,” Aly said.