Ticketmaster’s dynamic pricing infuriates music fans. Who is to blame?

You may have heard of the The Great Bruce Springsteen Ticket Debacle. After a six-year drought on the Boss Tour, tickets went on sale and fans suddenly found themselves staring at $4,000 price tags. Born to sob!

What was to blame? In two words: dynamic pricing, the same phenomenon of supply and demand controlled by an algorithm responsible for your Uber journey through the city or plane ticket to see grandma suddenly costs more. (It’s not the same as Adele’s $40,000 ticketsthanks to the resellers who won the best seats.)

Well, keep those wallets open, music fans. With fall concert season upon us and crowds still hungry for a live experience, expect dynamic pricing to impact the best seats. But there are still ways to get a good deal and even push for change.

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What is dynamic ticket pricing?

In 2011, Ticketmaster, the industry’s dominant – many would say, monopolistic – supplier of event tickets, announced that it would begin adjust prices according to consumer demand.

The goal was to prevent tickets from being diverted to secondary market platforms such as StubHub, providing more of that revenue to artists, venues and ticket providers.

“Fans have to realize that sometimes that’s what those top seats are worth,” says Bob Lefsetz, music industry analyst at The Lefsetz Letter. “The only way around this problem is to try to link each ticket to a specific fan with no transfer allowed.”

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Who is responsible for dynamic pricing: Ticketmaster or your favorite artist?

Taylor Swift is among a number of high-profile artists who have embraced dynamic pricing as a way to retain some of the top seat revenue that normally accrues to resellers.

When it comes to dynamic pricing, “it’s important to remember that it’s the artist telling Ticketmaster what they want to do, not the other way around,” says Lefsetz.

And many have done just that. Over the years, big names such as Taylor Swift, Drake, Paul McCartney, Ye and Harry Styles have adopted dynamic pricing. Currently, artists such as The Weeknd, Alicia Keys and Carrie Underwood are also offering their best seats – often dubbed Platinum Tickets – through this variable pricing system.

“This is when artists want to get out there and support themselves and their crews and the people who work for them, so they want market prices for those great seats,” says Dean Budnick, co-author of “Ticket Masters: The Rise of the Live Music Industry and How Audiences Got Scalped.

Decades ago, many states had strict but rarely enforced anti-scalping laws, Budnick says. But these have disappeared in part due to lobbying by resellers. The premium pricing is “a response to this and an attempt to generate more revenue for the artist”.

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So how expensive were those Bruce Springsteen tickets?

Bruce Springsteen shows have been high-energy affairs that last over three hours for decades.  The announcement of a new tour after a years-long hiatus prompted fans to buy his tickets, driving prices up.

Although Springsteen fans were outraged that their working-class hero let this happen, sales figures published by Ticketmaster reveal that around 12% of tickets were said to be Platinum, and therefore subject to dynamic pricing.

The 88% of tickets sold at face value were priced at $59.50 to $399, with an average price of $202, Ticketmaster told USA TODAY. Only 1.3% of tickets for all shows sold for more than $1,000 and more than half (56%) of tickets sold for less than $200; 18% were under $99, 27% between $100 and $150, and 11% between $150 and $200.

“Promoters and artist representatives determine the specific price for their shows,” Ticketmaster said in a statement. “The main factor that determines prices is supply and demand. When there are many more people wanting to attend an event than there are tickets available, prices go up.”

Do all fans hate premium prices?

The Eagles (seen here in 2013) started the trend for more expensive tickets with their 1994 comeback tour, Hell Freezes Over.  The band offered tickets for $100, which today seems like a bargain.

They don’t, says Lefsetz.

“The irony is that the people who pay the most to see their favorite artists are often the happiest, which you can see in the popularity of VIP experiences,” where artists offer more than just a seat in the show, says- he.

Concert tickets were underpriced for decades, says Lefsetz. A big change happened when the Eagles hit the road again in 1994 and priced their Hell Freezes Over tickets at the then-high $100. Fans dove. He adds that while it’s easy to argue that the best seats “only go to the big cats on Wall Street, that’s really not true; often it’s the hardcore, hard-working fan who saves up for that special experience.

His advice for those who still want big shows to be cheap: “If you want to see a band on the cheap, go to your local bar. It’s a matter of raw economics.

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Will ticket prices ever fall on Earth?

Pearl Jam frontman Eddie Vedder has struggled with Ticketmaster in recent years, at one point choosing not to play at any venue where the company controlled ticket sales.

Some artists tried to fight the high prices. In 1995, Pearl Jam challenged Ticketmaster by refusing to perform at venues where the company controlled ticket sales. More recently, the group came under fire fans for saying OK to the premium prices.

But real change is only possible if lawmakers limit Ticketmaster’s power, says Ron Knox, senior fellow at the advocacy group Institute for Local Self Reliance.

“Artists operate in a broken system,” he says. “The Ministry of Justice could review whether the merger of Ticketmaster and (promoter) Live Nation reduces competition, rips off viewers and intimidates performers.

Knox argues that a more competitive landscape for event tickets, from concerts to sports, would inherently lower prices across the board, as fans have limited discretionary income, especially in our inflationary age.

“Pressure could come from Congress and regulatory agencies,” Knox says.

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How to avoid dynamic pricing?

Bruce Springsteen, shown here with Paul McCartney, was revered by fans not only for his long shows, but also for his devotion to the working class.  So when some of the Boss tickets hit the four-figure realm, many fans felt betrayed.

The best tactic: patience. Just as the price of an Uber ride will go up when a concert ends, concert ticket prices are likely to go up in the excitement of the on-sale date. But if you wait, prices just might drop for those once expensive seats.

In a recent resale market ticket study by FinanceBuzz, concertgoers spent 33% less than the average ticket price when purchasing the day of the concert, and 27% less than average when purchasing the day before the show.

“Don’t exclude promotions from your local fan club or radio station,” Budnick says. “Check with your credit card company; sometimes they offer access to tickets. And don’t forget about production holds, which is the release of tickets by management closer to the show once that she determined how many tickets she needed to hold back for the artist. Get ready for more than one bite of an apple.

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