Backstreets Magazine has been solely focused on the world of Bruce Springsteen for the past 40 years. Every new album, archival release, and concert are treated with enthusiasm by longtime editor and superfan Christopher Phillips and his colleagues. However, Phillips and colleagues found themselves in the unique situation of penning a harsh editorial about their idol on July 24, days after Springsteen’s much anticipated E Street Band tour went on sale and shocked supporters with tickets costing upwards of $5,000.

They claimed that too many Springsteen fans were abandoned this past week and ignored in a manner that seemed both incomprehensible and preventable. The artist has insisted that he recognizes the crucial function of his audience. How, therefore, did we come to be confronted with ticket prices that, in far too many cases, exceeded normal, then completely veered from reality by orders of magnitude?

The Springsteen supporters were hardly the only ones. At about the same time, StubHub ticket prices for Adele’s rescheduled Las Vegas residency ranged from $670 for nosebleed seats to $40,000 for the front row. According to a short search on Ticketmaster, side view tickets for Lady Gaga at New Jersey’s MetLife Stadium cost $445.80 (front pit general admission tickets cost $923.40), and prime floor seats for Motley Crue/Def Leppard/Poison at Pittsburgh’s PNC Park cost $987.50.

So this is what a crisis of faith feels like, Backstreets said in a widely circulated tweet. Prices like this have sparked outraged op-eds and social media posts in recent weeks, leading many to believe this is just a case of rock star greed.

The reality is much more nuanced. Due to a number of factors, including Live Nations’ near-monopoly over live music, artists’ growing reliance on touring as a source of income, new technology giving scalpers a larger platform to raise prices, and limited government intervention to help control the market, the ticketing industry has evolved into the price-gouging headache it is today over a period of decades.

This is how a crisis of faith appears.
Backstreets Magazine’s Twitter account is at July 23, 2022.
How Near-Monopoly Live Nations Had on the Concert Industry Changed Live Music

Pearl Jam tried to play only venues that used competitor ticketing services in an effort to protest Ticketmaster’s outrageous service costs and monopoly over the live music industry in 1995. They quickly discovered that this required performing at unconventional locations like the University of Montana’s Adams Field House. They simply gave up when they returned in 1998 and played mostly Ticketmaster venues.

Since Pearl Jam discovered that large-scale touring is practically impossible without Ticketmaster more than 25 years ago, the problem has only gotten worse. Even while companies like SeatGeek have agreements with significant venues like Brooklyn’s Barclays Center, Ticketmaster still has over 80% of the country’s biggest concert venues under their hands.

Senator James Skoufis of New York State claims that they are a monopoly. That comes with all of the typical issues that monopolies have, not the least of which is the absence of a vibrant competitive market. They can charge whatever they want without fear of repercussions in a market that would otherwise be fiercely competitive.

They have monopoly power. Along with that, there are all the typical monopoly-related issues. Senator James Skoufis of New York State on Ticketmaster

After Ticketmaster and Live Nation merged in 2010, the two businesses gained enormous power. Over 13 million tickets were sold by Live Nation in 2021, generating over $1 billion in revenue. Its main rival, AEG, generated $281 million in revenue from the sale of 3 million tickets. Simply put, even without Ticketmaster, Live Nation would dominate the live event industry. But after they combined, they became the most powerful force in music business history.

Due to their increased purchasing power, fans have learned to accept things like service fees, which frequently increase the final cost by 30%, and major event on-sales, where resellers end up with the majority of the tickets. In recent years, instead of coming up with novel and creative ways to eliminate scalpers from the system, Ticketmaster chose to simply make money off of them by giving them a simple way to sell their tickets.

They’ve also started employing dynamic pricing, which causes ticket prices to change based on demand, often dramatically. Fans witnessed the sudden increase in price of $400 tickets to $5,000 during the most recent Springsteen on-sale. According to a Ticketmaster spokeswoman, promoters and artist representatives determine pricing strategy and price range parameters for all tickets, including those with dynamic and fixed price points. With the aid of analytical tools developed by Ticketmaster, supply and demand can be quantified and pricing may be established using both historical and current data. The particular pricing for their events is then decided by the promoters and artist agents.

Ticketmaster revealed data revealing that only 12 percent of tickets to the majority of performances used dynamic pricing, and the average ticket cost was $262, following an flood of outrage over high costs by Springsteen fans. Although people’s perceptions may have been very different, a Ticketmaster spokeswoman told Rolling Stone that overall, 18% of Springsteen’s U.S. tour tickets were sold for less than $99, and only 1% were sold for more than $1,000.

According to a former industry leader, if you underprice the tickets, you’re inviting brokers to stand in the way of your supporters and consumers.

This idea was reinforced by Springsteen’s manager Jon Landau in a statement to the New York Times last week. We carefully considered what our competitors had been doing when setting the ticket prices for this tour, he claimed. We picked prices that are comparable to others and lower than some. Despite claims that a small percentage of tickets cost $1,000 or more, the real average ticket price for our events has been in the mid-$200 level, he said. I think the price is reasonable in today’s climate for someone who is unanimously considered as one of the very best painters of his generation. Landau chose not to comment for this article.

However, many of the less expensive tickets ended up on resale websites like Stubhub or Ticketmaster’s own resale program very away. Many fans were consequently left with no choice but to choose between overpriced tickets on the secondary market or $1,000 per seat face value seats.

There is little indication that this trend will alter any time soon. For many fans, purchasing concert tickets has turned into a difficult, extremely stressful experience where they end up paying much more money than they intended.

Taking Action Against the Low Ticket Supply That Allows Brokers to Survive

Even without a dynamic pricing strategy, Springsteen’s concertgoers would have probably paid thousands of dollars for the most coveted tickets—but not directly from Springsteen. Because artists typically aim to keep tickets affordable for fans, yet because of the huge demand, tickets are a great breeding ground for scalping.

According to a former industry executive, most individuals are unaware that if you underprice the tickets, you’re asking brokers to stand in the way of your followers and clients. If you want an example of what happens when you underprice something, look at Sony. They underpriced their PS5s, and many snoops jumped in and resold them at exorbitant amounts. It seems sense that if you underprice anything that has a high demand, someone will find a method to sever the line between you and your consumer and profit from that.

In fact, according to the executive, the Springsteen prices probably could have gone for even more. Even while such a judgment appears absurd in light of the outrageous ticket costs for performances like Adele’s residency, it might not be entirely off-base.

You might have seen, in my opinion, far more than $10,000 per ticket. You might have tripled the figures. I believe there was moderation and great thought given to how it appeared to Bruce. According to the executive, it was a relatively conservative strategy in comparison to what his counterparts undertake. Fans aren’t accustomed to seeing him take a stride like that because it was the first time. There was definitely some surprise. No fan paid more than they were prepared to spend, and the same fans who purchased the pricey tickets would have done so on the secondary market in the absence of this strategy.

The value of brokers lies in their ability to reduce risk for event planners who are promoting events with low demand. Cris Miller, the chief executive officer of StubHubs

Companies like StubHub and SeatGeek have been harboring ticket scalpers for years, who constantly raise ticket prices for the fans. They have also provided them with the best platform ever for finding new buyers. Fans may complain about inflated pricing all they want, but reselling websites have no financial need to try to cool the market as they earn a cut of every sale that occurs there.

The ticketing executive adds of the resale markets: “They’ve done a superb job of selling themselves as being on the side of the fan, but what they’ve actually done is built this economy that in a sense has allowed brokers to get in the middle.

StubHubs Chief Business Officer Cris Miller responded to the criticism in a statement to Rolling Stone, adding that brokers are important in the ticketing industry because they help concert organizers reduce the risk they take on.

According to Miller, the majority of StubHub’s sellers are regular ticket buyers who are relisting tickets they can’t use, with brokers and independent sellers making up the other half. Brokers are beneficial to both the industry and consumers of tickets since they reduce the risk for promoters of low-demand events and make tickets more accessible for fans by providing healthy competition and a variety of avenues of distribution.

Reselling, according to Miller, is a crucial tool for fans in a primary ticketing system where neither accessibility nor fan convenience are currently prioritized. According to him, the biggest problem with the sector is its lack of transparency, which leaves fans in the dark and unable to make informed decisions about their purchases. Fans have little choice but to jump through hoops in order to try to get tickets to an event from an unknown amount of inventory due to single distribution channels that reduce healthy competition in the interest of buyers.

Miller continues to favor letting resellers charge whatever they want without restriction, despite the possibility of capping how much money they may make from selling tickets. According to Miller, we think artists have a right to be free to set the price for their tickets however they see proper. In a similar vein, once a consumer has legitimately acquired a ticket, we support the ticketholder’s freedom and right to freely resale their ticket, as a truly free market should provide.

If an artist were to park in a metropolis, they would only need to find a place to sit and be willing to meet all the demand. Lawrence Peryer, Chief Strategy Officer of Lytes

Because of bots that can help them acquire more tickets and other tactics like farming phone numbers to increase the likelihood of obtaining tickets that require personal information, scalpers still have an advantage over fans. Addressing the insufficient supply for the astronomically high demand for shows is the only way to stop the scalping industry. Either the government steps in or artistic endeavors are launched.

There are other startups that sell tickets that wish to solve their own problems. Ant Taylor established Lyte in 2014 with the goal of giving fans greater leverage in the resale market by establishing a marketplace where they can trade and return tickets. Lyte also collaborates with organizers and agencies by encouraging fans to pre-order tickets for events and collecting their credit card details as confirmation.

An artist can utilize the data from Lyte to determine the size of the room they need and more precisely forecast demand while planning their tour. For artists like Billie Eilish, who are confident in their ability to sell out any location they perform, such a plan may not make much of a difference, but Lytes Chief Strategy Officer Lawrence Peryer is certain the idea works.

Many other ticketing services concentrate solely on the supply. According to Peryer, consumers purchase time-exclusive tickets in order to have temporary control over a venue or a tour. We also carefully consider both ends of the market. We consider both supply and demand. In order to provide the promoter or whoever is organizing the event or tour with information on demand, we aim to gather as much demand as possible before and after an on-sale and before and after a sell out. After that, they can decide.

Images 1 and 2 are from Matias Delacroix/NurPhoto/Getty Images
Artists may attempt to exert more control over their ticketing tactics.

While businesses have a considerable level of market power, an artist and their teams ultimately have the final say in matters such as ticket prices, the number of dates they play, and the venues where they appear. High-demand artists must consent to whatever ticketing method is used by their tour, even though Live Nation and Ticketmaster would probably advise using tools like dynamic pricing to take more of the profits away from the scalpers and put it in their own hands.

Some of the more popular methods include Ticketmaster’s technology for Verified Fans, which in principle should help guarantee that fans who won’t resale tickets get the first opportunity to buy. Additionally, there are non-transferable tickets, which theoretically eliminate scalpers from the market and guarantee that ticket prices will remain constant.

Additionally, if a performer is particularly committed to keeping tickets accessible to fans and reasonably priced, they must exert control over supply and demand. For instance, Garth Brooks is known for flooding a market with tickets to increase supply and satisfy fan demand.

Peryer explains, “I could picture a situation where an artist parked in a metropolis. They don’t have to do any additional concerts, and they don’t have to alter their current operations in any way. They don’t need to exert more effort. They simply need to sit there and be ready to meet every need.

The former ticketing executive asserts that if you are a policymaker in this field and you are unaware of the level of fan ire there, you are living in a cave.

While an effort like Brooks’ is commendable, it is impossible to expect a performer like Bruce Springsteen to play the number of dates necessary in one place so that everyone who wished to see him could do so.

There is no one solution that works for all artists’ ticketing issues, and it is frequently difficult for artists to deal with ticketing on their own. Although Verified Fan slows down bots, it’s not clear how much it genuinely deters scalpers. Additionally, non-transferable tickets are not always practical. For instance, The Black Keys utilized non-transferrable tickets in 2019 for a unique fanclub-only performance at the Wiltern in Los Angeles.

Tickets for that performance couldn’t be resold, but that didn’t stop scalpers from asking hundreds of dollars for seats that the band later discovered were $25 and only meant for fan club members. Although measures were initially taken to try and ensure fans had the best chance of getting into an exclusive gig, hundreds of supporters were ultimately turned away at the door the day of the show, and they strongly criticized the band for how the event was handled.

Although they shouldn’t always be held responsible for a ticketing disaster, artists do have some autonomy over their ticketing techniques. It all depends on how zealously they want to create a fair ticketing market for patrons. Ticketmaster is primarily the order taker in this situation, according to the former CEO. Tickets would cost $5 if an artist requested that price, therefore that’s what they would. Everything should support that, regardless of Live Nation, Ticketmaster, or AEG. The artists must then take responsibility for their choices.

The executive continues, “Artists can say, Look, I’m worth it, you’re going to pay that.” Take that to the customers, and let the fans determine whether or not that is appropriate. On the other hand, I could put on that performance and donate some money because I’m a kind person who wants to give fans the best deal possible. That’s excellent, so give the artists access to those resources. The terrible issue is that, in my opinion, many of those instruments exist; they are merely not always utilized.

The Federal Government May Step In

The American government might theoretically take a number of steps to reduce the exorbitant cost of tickets or at the very least, make the system more equitable. When the Better Online Tickets Sales Act, which barred the use of ticket bots, was passed in the waning days of the Obama administration, they made a valiant effort. But the bill has a significant flaw that no one saw coming. According to Skoufis, there has been ZERO enforcement. Ticketmaster constantly detects bot behavior. However, they do not refer these cases to prosecutors.

Skoufis tried to pass a law requiring Ticketmaster and other ticket providers to notify the Attorney General’s office when bot activity is discovered, and it would even give them a share of the fee that is collected if they were successful in prosecuting the case. However, it failed to gain any traction in the State Assembly. According to Sjoufis, they fought back strongly on behalf of the ticketing platforms. They all agreed that they had no interest in participating in this.

(In an effort to enforce the BOTS Act’s restrictions, Ticketmaster continues to collaborate with state Attorneys General and the Federal Trade Commission, Ticketmaster shared in a written statement to the FTC. Additionally, Ticketmaster has filed individual lawsuits against bot users. Recent litigation by Ticketmaster in the Central District of California federal court resulted in a broad order prohibiting the defendants from using bots and other similar techniques.)

By charging a service fee for the initial on-sale and a second one when the ticket is resold on the same platform, Skoufis also attempted to make it unlawful for Ticketmaster and other businesses to double-dip on a single ticket. Even though it seems like such a common sense move that would be difficult to reasonably resist, this was likewise rejected by the State Assembly. According to Skoufis, what he is attempting is a 99-1 problem with the public. The issue is that the general population lacks an army of lobbyists. The issue is that neither Albany nor the majority of other capitals allow the general public access to the corridors of power.

Skoufis did succeed in getting a requirement that businesses list the whole price of tickets up front rather than saving the service charges until the very end of the transaction to be signed into law. He claims that our state was the first in the country to implement this. When people are looking for a ticket to buy, I do think it will make a significant difference. Additionally, I believe that in extreme circumstances it might even shame the vendors into being more moderate with their costs, at least on the periphery.

Although it’s difficult to imagine the day when the Ticketmaster/Live Nation monopoly will be broken up by the government and Ticketmaster and Live Nation have more influence with lawmakers than the average rock music fan, Skoufis is optimistic that significant change may come in the future if consumers remain as dissatisfied as they are right now with the status quo. If you are a policymaker working in this field, he advises. You have your head in the sand if you don’t know how angry the supporters are already.