Los Angeles Times
LOS ANGELES — Today is the day. You called in sick to work. You’ve been looking forward to the chance to buy seats since the show was announced. The webpage loads on your laptop, and you’re met with triple-digit prices for a ticket to see your favorite musician. In the seconds you spend hesitating, the entire concert is sold out. You quickly pull up a reseller site, and the prices are now four digits and climbing.
Taylor Swift fans saw a similar scene this year, as have masses of other aspiring concertgoers. For Swift’s sold-out shows at SoFi Stadium in Inglewood next month, face-value tickets sold for $49 to $449 if you could get them. Now, first-night tickets will set you back around $800 to $11,000 each on StubHub.
How did we end up spending more than your average mortgage payment for a seat at a concert? The answer is … complicated.
Why are concert tickets so expensive?
There are five major players influencing ticket prices for that concert you’ve been waiting to see: the artists, the promoters who put on the shows, the venues that host them, the ticketing companies that make the initial ticket sales, and the resellers that sell seats no longer available from the box office.
Each link in the chain is responsible for some portion of the cost of your concert-night experience, because each link is a business trying to make a profit.
Promoters are the connection between the act and the venue. They officially set the ticket prices, and they take on the loss if the concert doesn’t generate enough ticket sales to cover what the artist has been guaranteed. They organize and publicize the shows, and those costs go into the price of the ticket.
Artists like Swift at the top of the industry can tell the promoter where to set ticket prices and also pick the venues. Smaller acts have those decisions made for them. According to Bob Lefsetz, a music-industry analyst and former label executive, said the acts also have power over ticketing fees and resale policies if the primary ticket seller has its own resale platform, although they pay the ticket seller to take the heat for those decisions.
Venues are paid by promoters to put the shows on and the promoters get that money through ticket sales. Venues also may charge a facility fee, which adds to the slew of fees that show up at the end of your purchase. In addition, the buildings hold back tickets that they give priority to their suite owners or their loyalty programs.
Some venues are owned by or have exclusive deals with promoters such as Live Nation Entertainment (which also owns Ticketmaster). Others are called “open buildings” that any promoter can book. Every building has a ticketing contract, however, which typically requires the ticketing company to pay in advance for the right to sell the seats. And in Lefsetz’s view, Ticketmaster is the only company that has the technology to sell tickets for high-demand events because it has cornered the market and has the money.
Ticketing companies add the fees that can turn a $20 seat into a $35 seat (Ticketmaster‘s will make your head spin). Here’s the breakdown of the most common ones:
—The service fee, also known as a convenience fee, is the amount tacked on for the privilege of buying a ticket online instead of at the box office. Ticketmaster says it sets the fees with the artists’ input and typically shares the proceeds with them.
—The processing fee is the charge added to each order (not each ticket) to cover miscellaneous expenses associated with online ticketing. The Ticketmaster website says that the processing fee “offsets the costs of ticket handling, shipping and support.” If costs are lower than the processing fee, that money goes to Ticketmaster and is typically shared with the artists.
—The delivery fee is the charge for getting you the tickets you order, and it varies based on which option you select. The DIY options, such as tickets you print yourself or store in your phone, tend to be free or low-cost; not so much for having physical tickets shipped to your home. Ticketmaster acknowledges that sometimes a portion of this fee goes directly to the company.
—The facility charge is what helps the venue run the show. Ticketmaster’s website says it does not profit from this fee and does not decide how high it is. Artists decide if there is a fee and how much it is.
A 2018 report by the Government Accountability Office found that fees on initial ticket sales added 27% to the cost, on average. The lower the price of the ticket, however, the more burdensome the fees can seem.
Ticketmaster is this industry’s Goliath, but there are other ticketing agencies handling smaller venues and acts. Their common goal is to get rid of software “bots” that quickly buy tickets in bulk, raising prices for hot shows by shifting tickets to the resale market.
Resellers and ticket brokers such as StubHub and SeatGeek create a secondary market for tickets that buyers can’t — or never intended to — use themselves. Brokers compete with fans for seats in the initial sales, using teams of employees or software bots that snap up tickets faster than individuals can. In addition, the GAO’s report found that event promoters will sometimes distribute tickets through brokers “to capture a share of higher secondary market prices without the reputation risk of raising an event’s ticket prices directly.”
The GAO also said that, according to the four resellers interviewed for its report, “professional brokers represent either the majority or overwhelming majority of ticket sales on their sites.”
StubHub takes issue with the GAO’s number; of the people who sold tickets through the site last year, it classifies less than 1% as brokers.
Resale prices for tickets are set by the seller, although some resale sites will suggest prices for them. And this is where ticket prices can skyrocket, because the sites don’t limit how much a seller can charge.
“This is a truly market-driven platform,” StubHub spokesperson Jessica Finn said. “So this is really about what sellers think that the price, the value of the ticket is, and what buyers think the value of the ticket is, and they effectively agree on it with a purchase…. It’s very much a dynamic marketplace, prices go up and down and we don’t meddle with that.”
Lefsetz said the secondary market sells tickets for the prices they do because that is what the tickets are worth. They wouldn’t be on sale for those prices if people didn’t buy them for that price. If they set the price too high the tickets won’t sell — for example, tickets for Adele’s Las Vegas shows sold for an average price of $1,900, compared with the average listed price of $4,800, according to StubHub.
Resellers charge a similar array of fees to ticket buyers, but they add more on average to the cost of seats than the original ticket seller’s fees do. University of Chicago professor Eric Budish, an economist who studies ticketing in the United States, found that resellers charged buyers and sellers fees amounting to 30% to 40% of the ticket resale value. “So if a Taylor Swift ticket resells for say $2,000, the secondary market site … might be making 30% of that amount. 30% of $2,000 is $600. Taylor Swift sold the ticket for say $300. So the secondary marketplace is making more than Taylor Swift is, and then the broker is making more than either of them.”
Lefsetz says people want to sit in great seats without having to pay an exorbitant price for them; instead, they think they’re entitled to sit there because of how much they love the artist. “Everyone thinks that it is only the ultra-rich who are buying four-figure concert tickets. No, there are people who are saving up. This is their favorite band!”
What are the options for the future of ticketing?
The way Budish sees it, the industry has three economically logical options moving forward.
We could continue as we are with unrestricted reselling. Tickets go on sale at the price set by the promoter and, despite repeated efforts to confine sales to actual human fans, many get bought up by bots in seconds to be sold on the secondary market. Currently, it’s hard for fans to tell how many of the venue’s seats are even being made available in the primary sale, rather than being reserved for VIPs or other special interests.
The next option is that the promoters set what is called a “market-clearing price,” that is, a price high enough to prevent the tickets from being resold for more money, but low enough to attract a full house of fans.
The market-clearing price could be thousands of dollars for prime seats to see a top act, and an artist may balk at the image that projects. But this price depends on the supply of tickets available. If artists add shows in a city where their music is popular, they can lower the price and accommodate the demand.
Ticketmaster has started trying to set market-clearing prices through a program it calls “platinum tickets,” where it sells the most in-demand seats separately from the primary ticket offering. According to the website, platinum ticket prices are determined by the demand, with the price for hot tickets rising as the supply goes down, “similar to how airline tickets and hotel rooms are sold.”
The company says that the goal of platinum tickets is to allow artists and promoters to set ticket prices that they think reflect their true market value. But the program can generate fierce backlash from fans, as Bruce Springsteen discovered last year when platinum ticket prices skyrocketed above $4,000.
The final option is to restrict or end resale. Options for this route would be to make tickets nontransferable, allow resale only at face value and only on the primary seller’s resale platform and use technology to attempt to identify real fans by looking for irregular behavior on their accounts. The Cure used all of these measures on their most recent tour. Lead singer Robert Smith advocated for his fans to the point that he convinced Ticketmaster to refund some of the excessively high fees on the tickets.
What would it mean to restrict ticket resale?
A ticketing company called Dice has attempted to block the secondary market by issuing tickets only a few hours before an event and enabling customers to return unwanted tickets for resale at face value. This generates a refund only if the tickets are resold by Dice. Fans looking for tickets to a sold-out show can get on a waiting list, forming a virtual line for the next ticket made available for resale on Dice. This allows the price to stay the same and for the revenue to go to the artist and the venue.
The waiting list also shows artists what the demand is for their concerts. If there are more fans on the waiting list than the number of tickets sold, then they can add another tour date in that city.
Dice allows some tickets to be transferred from the buyer to another user of the Dice app, which opens the door to tickets being exchanged for more than face value — potentially through another platform. The company tries to prevent that, however, by using machine learning and other tools to monitor its system for “suspicious behavior,” spokesperson Joomi Park said. “If we suspect anyone is trying to cheat the system, they’re banned from Dice, it’s that simple,” Park added.
You can’t get your Taylor Swift or NBA tickets on Dice, but what would happen if this idea was implemented on a larger scale?
The Fédération Internationale de Football Association uses a similar resale process for the World Cup, offering a platform where people can sell the tickets they bought but they cannot set the price lower than 15% or exceed 110% of the original face value of the ticket. (FIFA also charges a 10% administration fee.)
So, what deters World Cup fans from going elsewhere to sell their tickets? At the 2023 men’s World Cup, it was the host country’s government: Qatar passed a law granting FIFA exclusive rights to sell World Cup tickets. According to Reuters, “hawkers caught face fines of up to 10 times the face value of the tickets being sold illegally.”
Still, fans with money have shown time and again that they’ll pay far more than the face value of a ticket to see their favorite artists, so it’s unrealistic to think that the secondary market can be eliminated. People will still resell seats under the table; the more this happens in unauthorized channels, the less protection fans will have against scams.
And there are many reasons why people want the freedom to resell tickets as they see fit. StubHub’s Finn offered this example: Say you had a ticket to an Inter Miami season-opening game to see Lionel Messi play. “You’re going with your son and suddenly realize like, ‘Hey, I can actually pay for my entire set of tickets next season if I don’t go to this one starter game.’ Can you really discredit the person from trying to think that way? That’s the way the market turns. That’s not an unfair thing for them.”
The resale market is attractive to artists, too. Major artists have been known to dip their toes in the secondary market by withholding tickets during the primary sale and then “reselling” them to make more money off the broken system.
In 2011, the Smoking Gun website posted a copy of Katy Perry’s rider for her world tour that year, laying out the amenities that had to be provided at each stop. One demand was that promoters hold back tickets for her team to offer through resellers.
Budish says this practice isn’t uncommon; many artists have been caught doing it. For example, in 2019, Live Nation admitted to an agreement with Metallica to hold back 88,000 tickets for the band to sell on the secondary market.
What are bots and can anything be done about them?
According to Queue-it, a company that helps manage high-volume website traffic, there are multiple parts in the ticket-buying process where scalpers employ bots. During ticket presales, bots can create fake accounts to circumvent buying limits, or they can even hack existing, real accounts. To get into legitimate accounts a bot may be designed to guess passwords, which is called credential cracking. They also can use stolen passwords and apply them in bulk to ticketing websites, something called credential stuffing.
During the primary sale, people can use scraping bots to scan the internet for available tickets so they are the first to arrive at the sale. Then, they use expediting bots to buy many tickets at once.
There is even a bot that can hold tickets in its cart so it appears to fans that the tickets are sold out, inducing them to go to the secondary market. These are called denial of inventory bots.
According to a 2018 study by Distil Networks, a company that detects and mitigates bots, about 40% of the bots observed across all 180 ticketing domains were what they call “bad bots,” which are computer programs designed to cause harm.
The National Independent Venue Association, which represents independent venues and promoters, has created a coalition called “Fix the Tix” that lobbies for measures to restrict bots. The coalition wants Congress to update the 2016 Better Online Ticket Sales Act to ban speculative ticket sales and expand the protections against bots used by “predatory resellers.”
A tricky aspect of making sure tickets land in the hands of fans is that artists can’t identify who their fans are. They have created fan clubs to give registered members early access to tickets, but brokers created multiple bogus registrations and bought up tickets that way. This fan club idea is what Ticketmaster tried to do with its “Verified Fan” initiative, but the company got bombarded with bots anyway.
Ticketing companies have also tried to deter bot sales by attaching an ID to a ticket that must be checked at the door. But that raises venues’ costs by requiring them to have people checking IDs, Budish said.
I need a ticket, what do I do?
If you are buying on the secondary market, use a trusted service that can verify your ticket and reimburse you if you encounter a problem.
Waiting until the last minute is a high-risk, high-reward strategy. If people price their tickets too high on the resale market, they won’t sell. (The same is true for the initial sale prices). So inevitably, buyers (and promoters) will eventually cut their prices to avoid being stuck with unsold seats — but only if there’s too much supply.
StubHub noted that interest in tickets peaks when the tickets first go on sale and sometimes right before the show. It advises fans to buy some time in between.
Compare the popularity of the act and the venue. If it is a high-demand show in a small space, prices are likely to be more expensive. Check if they are playing at any bigger venues.
Check prices on different websites to compare. If you see a price that looks too good to be true, it probably is.
Your favorite artist’s tour may be sponsored by a credit card company, which will have tickets reserved for cardholders. Leftsetz said that his credit card company reached out to him months after the Taylor Swift tickets sold out and asked if he wanted tickets. They sometimes do presales as well.
Join the fan club. If there is a fan club for an artist, it typically gets an allotment of tickets. According to the GAO, 10% to 30% of the tickets for major artists’ shows are typically reserved for presales, whether for fan clubs or other groups, although the percentage can be much higher for the biggest events.
Think about going alone. It is harder to sell single tickets, so they are likely to resell at a lower price than groups of tickets.
Know someone. Meet someone who works for the building, the act or the promoter.
Just show up at the venue on the day of the show. If the tickets that were held back during the primary sale didn’t sell, then promoters may give them to the box office to sell. Nonprofessional ticket scalpers also show up at the event and try to sell tickets there, but beware — scalping is generally illegal in California, and you may be scammed with counterfeit tickets.