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Live Nation now sells snake oil.

10|25|09
by

The Problem

I was interested in getting tickets to a show at the Orpheum Theater (WFNX Miracle on Tremont St featuring Spoon, Phoenix, and Passion Pit), so I tried to purchase them via Live Nation and I got a really nasty surprise when I saw what the tickets were going to cost. Live Nation wanted to charge me a $12 “Ticket fee” per ticket, so I did not purchase any.

Live Nation gouges ticket prices.

The blue arrows indicate this monstrosity of an additional charge. The tickets actually cost $27 each for Level 2 pricing ($30 Level 1 tickets were “unavailable”), so this $12 Ticket Fee is 44.44% of the price of the ticket itself. Is there any other business in which a commission of nearly 50% is acceptable? The venue fee of $2.00 looks rather diminutive next to the ticket fee, not to mention the incredibly measly 50¢ that goes to “charity”.

Live Nation's Commitment to Charity

So let me get this straight: the cost of printing a ticket is 600% more expensive than the cost of hiring ushers, concessions staff, security, and a clean-up crew; electricity for the event; and paying the venue’s rent? Those tickets must be printed on the Shroud of Turin in the blood of the Loch Ness monster.

In actuality, most people probably print their tickets themselves at home. In those cases, I am even more baffled by the ticket fee. Are we paying for the privilege of buying something via a website? I assumed the whole point of online purchasing was convenience (for consumers: no need to trek to a real-world box office) and lower costs (for ticket agencies: no need to staff a real-world box office).

I go see a fair number of live events each year between musical performances, theater, and the occasional sporting event and I have never encountered a fee this exorbitant. I wondered why anyone would willingly pay this fee, but that question was already answered for me as 2 hours after the tickets went on sale the lower section was already sold out. Therein lies the problem: ticketing agencies will not change their policies if consumers continue to use their services regardless of their unethical business practices.

In case you aren’t frightened enough by Live Nation already, you should know that there is a merger planned between them and Ticketmaster, if they can get through the anti-trust laws first. This graphic from this article sums up how many middle-men will be between you and your favorite artists:

Live Nation Entertainment: The new face of monopolies

Before I go further, I want to give the accused an opportunity to tell their side of the story, so: Live Nation, Ticketmaster, and any other ticketing agencies that create unfair and exorbitant additional charges, I challenge you to answer the following questions which are not part of your online FAQ pages:

  1. What are consumers paying for when they pay these additional fees?
  2. Why are the fees not explained on your website?
  3. Why do you get 28.91% of the total price of the ticket when arguably, you are providing the smallest and most unskilled part of the entire operation (which in my mind consists of ticket sales, venue prep and operation, and finally the performance itself)?
  4. Would you consider your business practices to be fair and ethical?
  5. What are your policies concerning charitable donations?

Please feel free to respond in the comments section. I would be happy to discuss my thoughts with you.

The Solution

The only way to bring about a change in ticketing agency practices is to stop giving your money to the offending agencies.

But my favorite band only plays at Live Nation venues! YOU are the only one who can make this change, so YOU must write to your favorite performers and your local venues and tell them to discontinue their affiliations with Ticketmaster and Live Nation. This will not be an easy thing to do as evidenced by Pearl Jam’s failed battle with Ticketmaster, but taking their money away really is the only way to stop them.

Are there any ticketing agencies out there who are fair? Brown Paper Tickets are proof that it is possible to run a fairly priced and highly functional ticketing agency. I have used their service both as a producer and a customer and I think they are fantastic in every aspect of their business. Not only is their customer service top-notch and their service fees fair and affordable, but they also donate at least 5% of their profits back to the community. Brown Paper Tickets should be the industry leader as far as ethical business practices, but as it is they are just a small (albeit quickly growing) business out of Seattle, Washington. From their website’s FAQ:

2. How can your service fees be so low?
A good question, but a better question is, why are the other companies’ service fees so high? To answer your question, we’re not greedy. The reality is you don’t have to charge much to deliver an excellent service.

Oh, well they must treat their employees terribly! Not at all:

All of our full time employees receive health care, a window, and even a free bus pass each month…

Is what you are proposing actually possible? Of course it is. This may be a naive or simplistic way of looking at the situation, but it would be more naive to assume that you as a consumer have no power.

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6 Comments leave one →
  1. 10|25|09 12:32 pm

    Great post.

  2. 10|25|09 6:03 pm

    I represent neither Live Nation nor Ticketmaster, but herein attempt to briefly answer the five questions included above:

    1. What are consumers paying for when they pay these additional fees?
    Ticketing software, customer service, the reliable servers that make it possible for you to purchase a ticket.

    2. Why are the fees not explained on your website?
    It’s not a publicly owned entity. There’s no reason to explain all their goings on.

    3. Why do you get 28.91% of the total price of the ticket when arguably, you are providing the smallest and most unskilled part of the entire operation (which in my mind consists of ticket sales, venue prep and operation, and finally the performance itself)?
    Because they can. In a capitalist society, one takes advantage however they can. In this case, consumer ignorance, impotence and apathy give them a huge advantage. It’s in their best interest to maintain this system. And that they can and are taking 28.91% is the very reason why they should get 28.91%.

    4. Would you consider your business practices to be fair and ethical?
    Fair and ethical are not what the stockholders want. Fair and ethical are not on the bottom line.

    5. What are your policies concerning charitable donations?
    We advertise that some money will go to a charity as a sales point, but only give the bare minimum. The consumer is more inclined to focus on the good of the charity than the heinous fees (not truly examining the dollar amounts of either). Most charities, actually, do this to some degree.

  3. Matt Kazlauskas permalink
    10|25|09 8:42 pm

    Jordan –

    This is an awesome article. Ticketmaster and Live Nation essentially control all ticketing in the country, and are now using that fact to exploit the consumer. This is as close to a monopoly as it gets, and considering ticketmaster and live nation are trying to merge, the situation could potentially become a true monopoly. Last time I checked, that was illegal. Nice job.

    Matt

  4. 10|25|09 10:45 pm

    I went through a very similar exercise at the TicketMaster site when the merger was first proposed, and I agree that it’s a travesty. These are companies that have a de facto monopoly, that they’re looking to extend. Cheers on your calling TM/LN out with your list of questions.

  5. 10|27|09 9:29 pm

    Thanks to everyone who has appreciated this post. Please keep passing it on to other music fans. There will be more from me on this front in the near future.

  6. 06|24|13 6:08 am

    great points altogether, you simply received a new reader. What might you suggest in regards to your put up that you simply just made some days ago? Any sure?

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