Some fans charged $5000 in dynamic pricing scheme, latest black eye for ticket monopoly
U.S. Rep. Bill Pascrell, Jr. (D-NJ-09), the Chairman of the House Ways and Means Subcommittee on Oversight has today written to the head of Live Nation Entertainment demanding answers about Bruce Springsteen tour ticket sales last month, and how Live Nation-Ticketmaster’s secretive dynamic pricing scheme impacts consumers. Many fans were shocked after being asked to pay outrageous markups to obtain tickets to see Springsteen’s 2023 tour. The recent outcry from Americans across the nation is just the latest scandal due to Live Nation-Ticketmaster’s long-running domination and abuse of the live events ticket market.
“I write on behalf of my constituents and fans across the country that are excited for Bruce Springsteen and The E Street Band’s 2023 tour. Hard-working Americans who are fans of Bruce and other popular entertainers should have the ability to enjoy live entertainment without ticket-sales practices that rip off consumers,” Chairman Pascrell writes Company President and CEO Michael Rapino. “To help fans better understand the frustratingly opaque process that leads to such high prices, I am inquiring about the veracity of the company’s statement, as well as the policies and prices the company has put in place for this tour.”
In July 2018, Reps. Pascrell and House Energy and Commerce Committee Chairman Frank Pallone, Jr. (D-NJ-06) wrote a letter to then Federal Trade Commission chairman Joseph Simons highlighting a Government Accountability Office (GAO) study which found a myriad of consumer protection and competition issues in the primary and secondary live event ticket markets.
The GAO report was commissioned in response to Pallone and Pascrell’s work, and the members urged Simons to do more to protect consumers in the marketplace. In response, the FTC organized a workshop on event tickets held in June 2019 to review many of the challenges faced by ticket-buying fans. The House Energy and Commerce Committee held a landmark oversight hearing in early 2020 on the lack of transparency in the ticket marketplace that Pascrell attended.
Pascrell has been the principal sponsor of the BOSS Act, overarching legislation that would impose a basic level of transparency upon the ticket industry so fans have a fair chance to purchase tickets on the primary market and also seeks to protect consumers who choose to use the secondary market to purchase tickets. In 2016, the bill received a hearing in an Energy and Commerce Committee subcommittee. Pascrell is working to reintroduce the legislation this year. A full section-by-section breakdown of a prior version of the BOSS Act is available here.
On March 22, 2022, Rep. Pascrell wrote to the heads of the Federal Trade Commission (FTC) and the U.S. Department of Justice (DOJ) Antitrust Division urging them to overhaul federal guidelines to make it easier to overturn bad mergers. As part of the agencies’ joint inquiry into modernizing merger regulations, Pascrell flagged the Live Nation-Ticketmaster as a “posterchild of consolidation gone bad” and urged its dissolution.
Pascrell has been a leader in Congress calling for regulation of the opaque live events ticket market. Pascrell was an early critic of the Live Nation-Ticketmaster merger, and repeatedly urged the Obama administration to reject it, warning that the union would crush competition and harm consumers. In May 2018, Pascrell wrote an op-ed in the Los Angeles Times on his attempts to impose greater positive regulation on the broken live events ticket market.
The text of Chairman Pascrell’s letter is below.
August 31, 2022
Michael Rapino, President and CEO
Live Nation Entertainment
9348 Civic Centre Drive
Beverly Hills, CA 90210
Dear Mr. Rapino:
I write on behalf of my constituents and fans across the country that are excited for Bruce Springsteen and The E Street Band’s 2023 tour. Hard-working Americans who are fans of Bruce and other popular entertainers should have the ability to enjoy live entertainment without ticket-sales practices that rip off consumers. Ticketmaster has tacitly acknowledged these issues by making a rare public statement to inform the public about the percentage of seats being sold at different price ranges. To help fans better understand the frustratingly opaque process that leads to such high prices, I am inquiring about the veracity of the company’s statement, as well as the policies and prices the company has put in place for this tour.
Media reports and constituent complaints indicate that primary market tickets for this tour cost some consumers more than $5,000 per seat. These prices are a direct result of your company’s “market-based pricing” known as the “Official Platinum Seats” program.[1] While your company claims that this system allows artists and event organizers to fairly determine the “true market value” of tickets, it has resulted in fans paying exorbitant prices.[2] Additionally, the fine print of your program allows additional amounts or fees to “be added on top of” the already elevated prices.[3]
The verified pre-sale of tickets each morning has caused high levels of stress and frustration for our constituents as they see tickets disappear from the primary marketplace website as if purchased, only to reappear at higher prices. Your verified ticket reselling program has also caused great frustration. For example, even though your website lists a date and time for a general ticket sale in the afternoon, the only tickets available at that time are resales. As a result, fans logging in for a general ticket sale are only able to purchase tickets that were bought during the morning pre-sale and then listed at higher prices on your secondary marketplace, which uses the same platform and is virtually indistinguishable from your primary marketplace.
The Government Accountability Office (GAO) previously examined and described these issues in a 2017 report. In that report, GAO described a market rife with practices that are “not fully transparent,” as well as questionable gimmicks to conceal extra costs from consumers used by your company, which claimed more than half of ticket sales in the United States at the time.[4] These gimmicks include ubiquitous service, processing, facility, and promotional fees hidden from view until the end of the on-sale process that understandably frustrate consumers attempting to purchase tickets.
Reforms are desperately needed, and that is why I introduced the BOSS ACT that would bring much needed transparency to the sale, pricing, and distribution of live-event tickets.[5] However, your company could unilaterally enact these consumer-friendly reforms at any time, and because your company controls an overwhelming portion of both the primary and secondary ticketing markets, these reforms would likely become the industry standard overnight. Yet you choose not to act responsibly, instead prolonging the frustration and confusion of consumers.
To better understand your Official Platinum Seats program and other policies surrounding ticket sales and pricing, I ask you to answer the following questions by September 30, 2022.
1.For Bruce Springsteen and The E Street Band’s 2023 tour:
1.How many shows will be played in venues owned, operated, or exclusively booked by Ticketmaster?
2.For how many of these shows is Ticketmaster the primary ticket seller or the exclusive ticket seller?
2.According to a statement attributed to your company “[p]rices and formats [for Bruce Springsteen and The E Street Band’s 2023 tour] are consistent with industry standards for top performers.”[6] Please provide specific data and any details that support the statement that these prices and formats are “consistent with industry standards for top performers.”
3.Does your company inform customers as to how many tickets will be available for sale, at what time, and how they will be priced so they can make informed purchasing decisions? If so, please provide examples of the information shared with customers.
4.For Bruce Springsteen and The E Street Band’s 2023 tour, please describe how Official Platinum Seats prices are set, including:
1.How pricing varies by venue;
2.Whether the prices are manually set by individuals or are automatically set by an algorithm;
3.The parameters that are used either by individuals or the algorithm to determine under what circumstances a price increases or decreases; and
4.Whether your company sets the minimum and/or maximum price of tickets in the Official Platinum Seats program and, if so, the process for setting those prices.
5.Please state whether a price ceiling on the cost of tickets for Bruce Springsteen and The E Street Band’s 2023 tour was ever put in place or contemplated by your company or any representative of Bruce Springsteen and The E Street Band.
6.Your company released selective data of ticket sales for Bruce Springsteen and The E Street Band’s 2023 tour that showed one-in-ten consumers purchased tickets through the Official Platinum Seats program.
1.Please confirm the total number of tickets that have already been sold through the Official Platinum Seats program for this tour broken out by each show at each venue.
2.Please confirm how many tickets were sold in the following price ranges: from $59.50 to $199, $200 to $399, $400 to $599, $600 to $799, $800 to $999, $1,000 to $1,499, $1,500 to $1,999, $2,000 to $2,999, $3,000 to $4,000, and over $4,000.
7.Regarding ticket sales to the general public for Bruce Springsteen and The E Street Band’s 2023 tour:
1.How many tickets have not been made available to the general public for sale per tour stop?
2.For those tickets that have not been made available to the public for sale, how many will be released at a later date and how will they be priced?
3.How many tickets will not be made available to the public for sale at all and will instead be distributed to sponsors, industry-insiders, season-ticket holders, or other parties? Please break this down by each show at each venue.
8.Fans raised concerns that they were unable to purchase a single ticket through the Official Platinum Seats program.
1.Please explain if there are restrictions on purchasing a single ticket.
2.Please detail the percentage of tickets sold to consumers who purchased a single ticket for each show.
9.Please explain how consumers are prioritized for purchasing tickets on your platform and who determines this queue prioritization.
1.Do consumers who buy merchandise from the artist or pay an annual fee to the fan club get a higher priority for ticket purchases?
2.Customers are encouraged to register for Ticketmaster’s Verified Fan on-sale, which is described as the “best chance at getting tickets” to Bruce Springsteen and The E Street Band’s 2023 tour. Please explain how Verified Fan “help[s] ensure only fans are invited to purchase tickets,” as claimed by your website, including whether a portion of tickets is reserved for customers registered through Verified Fan and whether customers registered through Verified Fan are provided information on the timing of ticket sales that is not provided to the general public.
Thank you for your attention to our request. I look forward to working together to improve transparency in the ticket marketplace and help fans see their favorite artists without being subjected to unfair and confusing practices.
Sincerely,
[1] Ticketmaster Says Most Bruce Springsteen Tickets Are Under $200, Only 11% Are Part of Controversial ‘Dynamic Pricing’ Program, Variety (July 24, 2022).
[2] Ticketmaster, What Are Official Platinum Seats? (https://help.ticketmaster.com/s/article/What-are-Official-Platinum-Seats?language=en_US) (accessed Aug. 18, 2022).
[3] Id.
[4] Government Accountability Office, Event Ticket Sales: Market Characteristics and Consumer Protection Issues (Apr. 12, 2018) (GAO-18-347).
[5] H.R. 3248, 116th Cong. (2019).
[6] See note 1.
Original source can be found here.
