According to Lawrence, singer from a band,
A fan's ticket money could be listed at $30, but Ticketmaster tags on a 40% fee, so the fan pays $42. However, the band's share is a mere $12, with not a cent from Ticketmaster's added fee. Sometimes it can go high as 82%.
While Live Nation's concert organizing costs are accounted for, the band still needs to pay for its tour cost. In this band's case, roughly 50% of their earnings is used to cover expenses. So that leaves them $6, pre-tax — and they still have to pay their own health insurance.
"We have seen really outlandish numbers — like, we had one show last spring where there was an 82% fee on top of the base price. Again, we have no say in, or we don’t even know what it’s going to be until it goes on sale," Lawrence said.
Joe Berchtold, president of Live Nation Entertainment, claimed the fees are set by the Live Nation venues and those fees are "consistent with the other venues in the marketplace." He said they cover the cost of the venue's operations.
According to the singer, the venues don't set the overall fees. Clearly there isn’t transparency when no one knows who sets the fees.
The singer also described a hypothetical sold-out show at a Live Nation-owned and Live Nation-operated venue.
When an artist plays these venues, they are required to use Live Nation as the promoter. Far from simply advertising, the promoter coordinates and pays the upfront costs to put together a concert, such as renting and staffing and the venue and striking a deal with the performer.
As with promotion, if an artist plays at a Live Nation venue, then the artist has no choice but to have the show ticketed by Ticketmaster. Allegedly, they have absolutely zero say or visibility in how much these fees would be. They find out the same way as everyone else by logging on to Ticketmaster once the show already goes on sale.
Live Nation not only acting as the promoter, but also the owner and operator of the venue, it seriously complicates these incentives.
According to the artist, in negotiating, artists have no leverage over Live Nation. At the end of the show, costs will have eaten into most of the money made that evening, and due to Live Nation's control across the industry, they allegedly have practically no leveraging in negotiating with them. If they want to take 10% of the revenues in facility fees, they can and have. If they want to charge $30,000 for the 'house nut' (the fixed fee the venue takes), they can and have. And if they want to charge us $250,000 for a stack of 10 clean towels, they can and have. After these costs have been accounted for, the remainder of the show revenue is split between Live Nation and the band.
Highlights from the Ticketmasters hearing:
-Live Nation-Ticketmasters a true monopoly
-Ticketmaster controls the ticketing at 70 to 80 percent of major concert venues in the United States
-Live Nation can profit from concerts put on by rival promoters because it still makes money through its control of Ticketmaster
-Live Nation had threatened venues that it would withhold tours under the company’s control if those venues did not sign deals with Ticketmaster (which explains why almost every labels use LN as their promoter).
-Live Nation and Ticketmaster often acts as three things at the same time — the promoter, the venue and the ticketing company
-The committee also said it wants information about the fees Ticketmaster charges customers. It also asked to learn more about dynamic pricing, ticket availability limits, restrictions on transferabiity and the company’s efforts to thwart bots and scammers. Ticketmaster did not immediately respond to a request for comment.
-Ticketmaster has to do what the acts and the promoters want, and Ticketmaster becomes the fall guy for all of this. TM representative defends.
