Sunday, February 25, 2024

Has Live Nation priced concert-goers out of big-ticket shows?

The company’s business practices have come under fire, but bots, artists and ticket resellers also play a role; legislators can opt to revisit scalping law

The complaint has been constant: Ticket prices have become exorbitant since Live Nation took over management at local venues. Port City Daily looked into the practices and other factors that play a role in inflation of ticket prices. (Tom Dorgan/MoonFrog Media)

WILMINGTON — During the past decade, Live Nation and its subsidiary Ticketmaster have become household names for ticket buying. Now, the names often conjure ire in fans critical of the consumer experience. 

“It’s gotten to be such a big monster now,” local concertgoer Jennifer Lancaster said. 

Lancaster was one of the many Wilmingtonians with eyes on Dave Matthews Band tickets for their May 30 and 31 concerts taking place at Live Oak Bank Pavilion. She didn’t have a presale code, so she signed on 10 minutes early to the general sale at 10 a.m on Feb. 17. When she got into the sale, she said the Ticketmaster website notified her there were 2,000 people ahead of her.

 “Their standard thing,” she said. 

“What I’ve experienced lately is, even when the tickets go on sale to the public, you’ll notice a little pop-up that says, ‘we have a low ticket alert,’” Lancaster said. “And I’m like, ‘I got in line 10 minutes early, I’ve been in line all this time. How do you have a low ticket alert?’”

Still, she waited. 

When she finally gained access, Lancaster said there were only resale tickets available. Basically, ticket purchasers had begun posting their tickets to sell through Ticketmaster’s website, in some instances up to seven times more than the amount paid. 

“I like Dave Matthews Band, but I’m not a huge fan,” Lancaster said. “I’m not gonna pay $700 apiece to go see that.”

Lancaster’s ticket-buying experience isn’t unique; many locals likely have a similar story of missing out on originally priced tickets to Live Oak Bank Pavilion shows. Dave Matthews and Tyler Childers sold out in a matter of minutes. 

It’s important to note these shows most likely would have filled up quickly due to the high profile of the acts and smaller size of Live Oak Bank Pavilion (just over 7,000 seats). Without resellers, though, more tickets may have reached fans at face value.

Only recently has Wilmington become part of the national narrative about ticket scalping and exorbitant pricing surrounding Live Nation. The company inked a deal with the City of Wilmington for exclusive booking rights and management of Live Oak Bank Pavilion and Greenfield Lake Amphitheater over the last five years. 

Complaints lodged against Live Nation have been happening since it merged with Ticketmaster in 2010; that move has many, such as legislators and fans, labeling the company a monopoly. Critics claim the size of the company allows it to engage in unfair business practices with no consequence. 

The company lets resellers, often aided by bots designed to nab large swaths of tickets in mere seconds, jack up the ticket price with no limit. Then, Live Nation tacks on service fees at the end of the checkout process. 

It was only a matter of time before these problems surpassed frustration and arrived at full-blown outage. 

And it would take someone big to do it — someone like Taylor Swift. 

In November, the singer’s fans logged on to Ticketmaster for Swift’s 2023 Eras Tour.  They were verified as real people by Live Nation — a process that is used to weed out bots and resellers. They received a presale code to gain access to tickets before the general public could purchase them.

It was a dogfight. 

Fans reported waiting in the ticket portal queue for 10-plus hours, sitting by a computer unable to refresh, and risk their spot in line. Some were dropped due to site glitches and moved to the back of the line. 

Those who made it past purgatory then had to cross another hurdle: some presale codes didn’t work. The lucky few that could start shopping for tickets found that often when they clicked on one seat, it would become unavailable before they could add it to the checkout cart. And time was running out — those that couldn’t get in or check out fast enough were left with reseller tickets hundreds of dollars higher than the base ticket price.

Ticketmaster had to halt sales due to overwhelming demand, stating the site experienced 3.5 billion system requests, or more than four times its previous peak. It attributed the problems to bot attacks.

The national debacle caught the attention of Congress. On Jan. 24, the Senate held a hearing on Live Nation’s business practices that led to the Swift mess. The U.S. Department of Justice has opened an antitrust investigation into the company.

North Carolina’s Attorney General Josh Stein is also investigating the company for any consumer right or antitrust violations. Several state governments are considering legislation to increase competition in the ticket-buying market.

Until any action is taken to curb the company, local concertgoers say they have to be more strategic about the artists they want to see — perhaps indicating an end to casual concert-going for the average person.

“Artists that I really, really love, I’m gonna go see them no matter what,” Lancaster said. 

Though she likes Robert Plant and Alison Krauss, she didn’t buy any tickets to their Wilmington show. 

“When I first went on there and tickets were really high on the presale, I said I’m not spending this kind of money to see somebody I’m just OK about seeing,” she said.

Lawn tickets are priced $39.50 right now, but with tacked-on fees end up at $63.52 — another point of contention for concert-goers.

How it works 

While most of the criticism of Live Nation’s ticket-buying process is aimed at the company itself, how Ticketmaster works and the role of other players in the current system also affect the outcome.

The base ticket price is set by event organizers — the artists, sports team or venue; however, they share some of that profit with Live Nation. The exact split can differ per contract, but typically the artist will get 85% while the promoter gets the remaining 15%. 

The organizers also specify the amount of tickets allotted for presale, typically around 10%.

Aside from standard tickets, there are also platinum tickets. Not to be confused with VIP tickets that offer perks like meet-and-greets or special seats, platinum tickets are priced based on market value — prices inflate with demand.

Therein lies a Catch-22: When people know it will be hard to obtain a ticket due to high numbers of fans and resellers, it’s more common for multiple people from the same group to try their chances, or one person to use multiple devices. So, instead of one person seeking four tickets, it becomes four people seeking four tickets, driving up demand even more. 

Here’s the thing with platinum tickets: Artists have to agree to turn the feature on. If they do — and most choose to — they split the extra money with Live Nation. Typically, Live Nation walks away with up to 50%. 

Based on research, the platinum ticketing feature has never been turned on at Greenfield Lake Amphitheater. 

Then come the fees. According to the Ticketmaster website, the fees — service, delivery and facility charges — are determined in conjunction with event organizers, who also receive a cut.

The website states: “the portion of fees we keep helps us to provide our clients with software, equipment, services and support to manage their tickets and box office, and provide the sales network used by clients to distribute tickets to fans.” 

What’s left over is profit. Although unclear how the exact cost is determined, service fees do increase with the ticket price. And the higher the fee means potentially more profits for Live Nation. 

Dave Matthews Band tickets started at roughly $169 in the first 20 rows when they went on sale in February. A resale ticket posted for section one shortly after was priced at $251 with a service fee of $57. Another resale in the same section was priced at $512 with a fee of $113. 

The City of Wilmington, which owns Riverfront Park where Live Oak Bank Pavilion operates, doesn’t get an increased payout from the inflation of tickets. Its contract is set at $2 per ticket and $200,000 per year in rent paid from Live Nation. 

At Greenfield Lake, the city receives $2 on tickets, $1,500 per show for over 30 shows a year, capped at 40, increasing annually at 2%, plus $40,000 in annual rent, increasing at 2% annually. It has collected $12,240 total for shows over 30.

In 2022, the city received $306,052 for ticket fees, $244,000 in rent, with total ticket sales of $153,726 for both Live Oak Bank Pavilion and Greenfield Lake. 

Earlier this month, Live Nation announced record-breaking company earnings with $16.7 billion in 2022 revenue, outpacing its previous most profitable year (2019) by 43%.

The reselling debate 

In North Carolina, as well as many other states, reselling tickets for more than $3 over face value, what many refer to as scalping, is illegal — but only in person. 

In 2008, the North Carolina General Assembly made an exception for online resellers. Per General Statute 14.344.1., online reselling for more than face value is allowed if the seller registers with the state, remits state sales tax, and offers a refund guarantee to consumers. 

Following the legislation, Ticketmaster started pushing paperless tickets. Now, it states on its website “your phone is your ticket” — tickets aren’t emailed nor available for print. If someone wishes to transfer a ticket, they must do so through the Ticketmaster app — putting up barriers to in-person sales.

Even when Wilmingtonians purchase tickets at the in-person box offices for Greenfield and Live Oak, customers are issued a digital ticket via text that syncs to the app. The same service fees still apply.

What the General Assembly probably couldn’t predict in 2008, though, was the rise of bots. Hired by resellers to purchase large amounts of tickets at the blink of an eye, the computer programs are coded to override ticketing site rules, such as ticket limits and security verification. 

At the Senate hearing on Jan. 24, Live Nation President and CFO Joe Berchtold blamed the Swift fiasco on bots, stating they also attacked the Ticketmaster server. 

That’s exactly what the company’s verified fan presale code is designed to prevent. The website says it helps “level the playing field so more tickets go to fans who intend to go to the show — not ticket bots.”

After that remark, Sen. Marsha Blackburn (R-Tennessee) asked: “Why is it that you have not developed an algorithm to sort out what is a bot and what is a consumer?”

Berchtold rebuffed that Live Nation had invested over $1 billion to improve its technology, and bots and scalping should be addressed by Congress.

In 2016, Congress made bots designed to supersede site security illegal per the federal Bots Act of 2016. The bill allows the Federal Trade Commission and states to enforce violations. However, tracking bots is hard and cases are uncommon; the FTC didn’t bring its first case against bot usage until 2021, which was against three New York ticket brokers. 

A 2018 CBC investigation detailed an incident where a Ticketmaster employee attempted to recruit professional scalpers to cheat its systems, saying the company turns a blind eye to bots and fake identities. Ticketmaster denied having any program in place to enable resellers to acquire large volumes of tickets.

There’s also one more component to North Carolina’s online reselling statute: Venues can prohibit reselling tickets for higher than face value. Because the city’s contract gives Live Nation the right to manage the facility, the chances of that happening are unlikely. 

Here’s why: When Ticketmaster allows people to resell their tickets through its site, the company is essentially double-dipping its service fees. Live Nation earns a fee on the initial sale, then earns more money on fees when the ticket is resold. 

Live Nation has described its practices as artist-first; it claims when fans buy resold tickets from Ticketmaster, rather than a third-party, fans guarantee their money is supporting the artist. The company claims the practice protects the consumer from scams. 

Lancaster indicated that in an effort to fend off scalpers, Live Nation has become one itself. 

“Our taxpayer money built this venue,” Lancaster said. “They took our money from our citizens and built it, and now they’re hustling us to get a ticket.”

Undeniable 

Despite its issues, Live Nation is still the reigning champ in the ticket-buying game.

In 2018, the New York Times reported Live Nation tickets 80 of the top 100 arenas in the country. At this year’s Senate hearing, Berchtold refuted the paper’s claims that it occupied the predominant portion of market, noting its share was more like 50% to 60%. 

In a statement posted to its website on Feb. 23, Live Nation wrote Ticketmaster lost market share since the 2010 merger, not gained it. 

Still, senators from both sides of the aisle were circling the same idea — Live Nation could be a monopoly, putting political pressure on the DOJ to reverse the 2010 merger. 

Senator Josh Hawley (R-Missouri) called Live Nation a monopoly and cornered Berchtold on Ticketmaster’s control of resales on its platform. 

“You leverage market power in one market to get market power in another,” he said.

Senator Richard Blumenthal (D-Connecticut) added “unwinding the merger ought to be on the table.”

This isn’t the first time Live Nation got in hot water with the feds. The DOJ allowed the 2010 Ticketmaster merger — over the protests of those in the music industry — by a consent decree. It forbids Live Nation from coercing venues into exclusive deals to use Ticketmaster. 

In 2019, the DOJ found Live Nation had repeatedly violated that provision.

The City of Louisville has been one chief complainant against Live Nation; in 2014, managers of the KFC Yum! Center, a 22,000-seat arena, were considering replacing Ticketmaster Live Nation’s biggest competition, AEG. AEG told The New York Times in 2018 it had received a warning from Live Nation the arena would lose concerts if it dropped Ticketmaster. 

Live Nation refuted this, saying it has brought more concerts to the arena in the years since. 

For its violations, Live Nation agreed to reimburse the Justice Department for its costs in enforcing the regulations but was not fined. In the resolution agreement, the DOJ extended the decree until 2025 and amended language to make clear Live Nation cannot threaten venues in any way, and may not retaliate against venues that decide to use a system other than Ticketmaster.

For as many complaints that various people have had with the conglomerate, working with Live Nation also has benefits. 

Take Greenfield Lake, for example. 

When Live Nation took over, the venue was able to accept online payments and online ticketing, plus implement more concession stands with shorter wait times. The artist experience was also enhanced, with renovated green rooms and an improved electrical system so the venue doesn’t have to use generators.

The company has made thousands of dollars in capital improvements and maintenance expenditures at both Greenfield Lake and Live Oak Bank. At the latter, Live Nation invested in furniture, fixtures and equipment to the tune of $2 million. 

For artists, Live Nation offers access to many of the biggest venues across the country, with a hefty share of the ticket sale, plus potential for more earnings through dynamic pricing. Live Nation also manages some artists directly, like Aerosmith and Christina Aguilera, through its majority stake in Front Line Management. 

Some say the streaming age of music is also partly to blame for increased ticket prices, including local musician Lilly Triolo. 

“[Artists] sort of brand it like this is a way we’re getting our money back for, you know, Spotify and the way that the music industry is changing,” she said. 

On Spotify, artists earn as little as $0.0033 per stream, according to a 2020 Business Insider report. Calculations made by U.S. Rep. Rashida Tlaib note it would take 800,000 streams a month to make $15 an hour. 

Still, Triolo said there should be other marketplaces besides Ticketmaster. 

“We shouldn’t have Ticketmaster as the only way to get the tickets,” she said. “That’s where it’s scary because it’s a monopoly. They charge whatever they want. … And you can’t do anything about it.”

Next up

With the DOJ’s investigations in antitrust violations still underway, there is a possibility Live Nation’s merger could be reversed. The department, along with AG Stein’s investigation in North Carolina, note any violations found could result in legal consequences. 

However, simply increasing competition may not be enough; many advocate for legislation cracking down on reselling. 

The Wilson Center, Cape Fear Community College’s performing arts center that brings in national tours and acts, handles ticket sales in-house for its 1,500-seat venue. Still, its director of ticketing, Christy Grantham, said they are plagued with problems from resale sites. 

“One of the problems with the resale marketplace is these folks don’t even have tickets in hand to sell them,”Grantham said.

Resellers often wait until a buyer contacts them, then purchases the ticket from The Wilson Center at four times the original price. 

“It’s really horrible and they offer no additional added value,” she added.

Grantham shared between 10% and 20% of the audience for a national act have resold tickets. While some people have no hassle securing legitimate tickets from resellers, many are scammed. The Wilson Center deals with illegitimate ticket problems several times a week, she informed. 

“When I first started here, I really thought the key is education,” Grantham said. “You can buy from a reseller. That is absolutely your choice. But do yourself a favor and at least comparison shop.” 

The issues of reselling have worsened in the eight years since the Wilson Center opened. Grantham said she is in the camp that stricter rules should be placed on reselling tickets. 

“​​I would love to be able to say if you want to resell this, sure,” she said. “If you buy tickets and you find out you can’t come, or you have an extra one and you want to sell it, sure. Sell it at face value — or if you want to cover some additional fees or if you want to sell over 10% more, even 30%, 40% more, fine. Don’t sell it for 400% more.”

Like it has done before, the North Carolina General Assembly has the option to pass legislation, cap resell amounts and apply it to online resellers. 

“Set a limit, you know,” Triolo said. “Like, you can charge up to 25% extra if you really want to make a profit.” 

Since its Senate hearing, Live Nation has proposed a FAIR Ticketing Act. It calls for artists to decide resale rules, make speculative tickets illegal (an expansion of the BOTS Act), crack down on resale sites that are “safe havens” to scalpers, and have a mandated all-in pricing nationally. 

However, Ticketmaster rival StubHub characterized the move as a way to strengthen Live Nation’s position in the industry, while refusing to address its role in unfair practices. It is a proponent of the BOSS Act, designed to crackdown on improper practices.  

Lancaster has taken a more local approach; on Feb. 22, she emailed city council, whose contract with Live Nation is valid until 2027. 

“As a business person, I understand that it is necessary to hire the right folks to run things; however, the current management is making it almost impossible to attend a concert,” she wrote. 

Councilmembers Charlie Rivenbark, Kevin Spears and Luke Waddell said they would look into the matter in response, calling on Live Nation to give a presentation explaining the situation. 

Live Nation did not respond to multiple requests for comment. 


Reach journalist Brenna Flanagan at brenna@localdailymedia.com 

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