Reside Nation hits again at claims of price-gouging: ‘Tickets are literally priced by artists and [sports] groups’

Reside Nation, the dwell music big, has fired again at accusations that its dominance out there, and that of its ticketing arm Ticketmaster, is the offender behind skyrocketing live performance ticket costs. 

In an over 2,800-word weblog put up on Monday (March 4), the corporate vehemently denies duty for rising ticket costs, as a substitute pointing the finger at artists, venues, and secondary ticketing platforms.

“Tickets are literally priced by artists and [sports] groups. It’s their present, they get to resolve what it prices to get in. The NFL tickets on Ticketmaster had been priced by the house groups, live performance tickets had been priced by the performer’s enterprise groups, Monster Jam tickets had been priced by its producer (Feld Leisure), and so forth,” Reside Nation wrote.

“Tickets are literally priced by artists and [sports] groups. It’s their present, they get to resolve what it prices to get in.”

Reside Nation’s explainer comes amid ongoing scrutiny and criticism of the ticketing trade within the US, with Reside Nation and Ticketmaster usually being the goal. The 2010 merger of the 2 entities additional fueled considerations about potential monopolies and unfair practices.

Final November, the corporate was subpoenaed in a US Senate probe over “exorbitant ticket costs,” and the corporate is the goal of an ongoing antitrust probe by the US Division of Justice.

“American shoppers deserve honest ticket costs, with out hidden charges or predatory expenses. And the American public deserves to know the way Ticketmaster’s unfair practices could also be enabled by its misuse of monopoly energy,” Democratic Sen. Richard Blumenthal mentioned in November.

In its weblog put up Monday, the corporate steered that some criticism stems from real misunderstandings about how the dwell music trade operates, and Reside Nation’s position as a live performance promoter.

“These days, it’s widespread for prime artists to get 90% or extra of the online ticket revenues. The promoter will get solely what stays after the assure, different present prices, and the artist’s proportion have been paid out.”

“The arguments we hear about Reside Nation’s position in live performance pricing are inconsistent. Some declare that Reside Nation is so highly effective in live performance promotion that it may dictate what artists cost; others declare that Reside Nation can elevate its costs to artists, and this will get handed by way of to followers in greater ticket costs. Neither argument is believable,” Reside Nation mentioned.

Reside Nation famous that promoters usually assure performers a sure amount of cash for a present, and whereas they don’t set ticket costs, they do take note of pricing.

“Take into consideration a easy assure to an artist of $100,000 for one present at a 5,000 seat venue:  there isn’t any manner for a accountable promoter to supply that assure with out no less than a normal understanding of what these 5,000 tickets will promote for,” it mentioned.

The corporate additionally argued that the extra charges added to ticket purchases are needed for venues and ticketing corporations to recoup their prices, as they obtain minimal income from the face worth of the ticket itself. Reside Nation mentioned its take is usually 5%-7% of the face worth of the ticket.

“Service expenses are added to the face worth of live performance tickets as a result of two vital gamers within the live performance ecosystem – venues and first ticketing corporations – get little or nothing out of the revenues derived from the ticket’s face worth,” Reside Nation mentioned.

“The add-on nature of the service charge is annoying to many followers and fuels the narrative that these are junk charges. However they aren’t junk charges for the easy motive that the venues and ticketing corporations have prices related to the companies they supply to assist produce the present. They supply worth and a technique or one other can be compensated for it.”

Reside Nation additionally highlighted that artists and venues earn nearly all of the income from ticket gross sales and repair expenses, respectively.

“Promoters don’t set costs, artists do. The artist and [their[ business team listen to the promoter’s input and then decide. This is the case even with a promoter as large as Live Nation or AEG.”

“Nowadays, it’s common for top artists to get 90% or more of the net ticket revenues. The promoter gets only what remains after the guarantee, other show costs, and the artist’s percentage have been paid out,” it explained.

The company says that concert promoters, including Live Nation, offer proposals to artists, but the final pricing decision rests with the artist and their team.

“Promoters don’t set prices, artists do. The artist and [their] enterprise group hearken to the promoter’s enter after which resolve. That is the case even with a promoter as giant as Reside Nation or AEG,” it added.

Reside Nation attributes excessive ticket costs to elements like sturdy demand for widespread artists and the rising development of live shows turning into premier “expertise items.”

The corporate additionally highlighted the truth that artists now rely extra on touring revenue because of the decline in document gross sales on account of streaming. This, in response to Reside Nation, doubtlessly influences pricing methods.

Reside Nation additionally means that on-line resale platforms like StubHub have influenced artists’ pricing methods by showcasing that the “true market worth for his or her tickets” is greater than what artists cost within the major market.

Reside Nation concludes its explainer by stating that claims attributing excessive ticket costs to their dominance are “simply flat fallacious”. The corporate claims such statements goal to “rile up followers” and disrespect the complexities of the trade.

The corporate not too long ago described 2023 as its “largest 12 months ever” after reporting a 36% YoY soar in full-year income to $22.7 billion. The corporate additionally famous that over 145 million followers attended over 50,000 of its occasions final 12 months.

CEO Michael Rapino mentioned throughout an earnings name that the corporate was “really shocked and thrilled” that its all-in ticket pricing, which permits ticket-buyers to see the ultimate value of a ticket earlier than buy, is successful. Rapino predicted that all-in pricing will finally turn into not only a matter of follow for ticket sellers, but in addition a matter of legislation.

Music Enterprise Worldwide