Live Nation’s CEO, Michael Rapino, has addressed the recent controversy surrounding the sales for The Cure‘s upcoming North American tour.
Wishing to keep costs down for fans, the band opted out of Ticketmaster’s dynamic pricing scheme, which Robert Smith described as “a bit of a scam”, and restricted ticket transfers in states where they were legally allowed to do so. However, some fans attempting to buy tickets reported that Ticketmaster fees, including service fee, facility charge and order processing fee, exceeded the price of actual tickets, which Smith said he was “sickened” by.
Smith was later able to convince the ticketing giant to issue small reimbursements to verified ticket buyers to compensate for “unduly high” fees. He later had to ask Ticketmaster to explain why tickets in its promised face value ticket exchange were “weird” and “over priced”.
Now, Rapino has weighed in on the situation on The Bob Lefsetz Podcast. “We were proud of Ticketmaster’s side,” Rapino said. “We did a ton of work with Robert, making sure [tickets] were non-transferable, that it would be a face value [ticket] exchange and verified, doing all we could to put all the roadblocks to deliver his ticket prices to the fans.
He continued: “There was a screenshot of a venue, which wasn’t even a Live Nation venue… that showed a ticket service fee of $20 on $20. It doesn’t matter whether justifying the service fee is a good idea or not, we have an industry where we have to build some credibility back.
“I couldn’t defend in any version that we were going to add a $20 service fee to a $20 ticket. We made a decision that we would spend some money, give back the $10, and get it to a reasonable place for those fans.”
Rapino confirmed that Live Nation absorbed the cost of the reimbursement. “It was a fast decision, we thought it was worth the million dollars or so to send the right message.”
He was then asked if it was “reasonable to expect to see The Cure for $20 in an arena,” as Smith sought to do.
“No,” he responded. “I think the pricing of concerts in general – there’s this fine line between, yes, we want it accessible, and it’s a fine art and there’s a price to it.”
Rapino argued that fans are willing to pay high prices, even those inflated by dynamic pricing, because they see “concerts as a really special moment in their life.”
“It’s a magic moment, maybe twice a year – way cheaper than Disneyland, or the Super Bowl, or the NFL or the NBA playoffs, or an expensive night out,” Rapino said. “So it’s really cheap overall considering.
“This is a great, great product that people will buy, as they’re gonna buy the Gucci bag. They’re gonna buy moments in life where they will step up, and spoil themselves – the big screen TV and or whatever it may be.”
He continued: “This is a business where we can charge a bit more. I’m not saying excessively, but it’s a great two-hour performance of a lifetime, that happens once every three, four years in that market. You don’t have to underprice yourself — low to middle income [people] will make their way to that arena for that special night.”
Throughout the two-hour conversation, Rapino clarified that ticket pricing isn’t set by his company, but by the artists themselves, and that on average, 80 per cent of service fees go to the venue rather than Ticketmaster.
He also discussed the impact inflation has had on ticket prices overall, as the cost of fuel, labour, lighting, and transportation has pushed up prices by 19 per cent from 2019.
Rapino described the ticketing industry as “widely misunderstood” and “an easy target”. He did, however, acknowledge that there were areas for improvement, pointing to the use of all-in ticket prices (which include fees in the overall ticket price, as used by Pearl Jam), keeping platinum tickets below $1,000 (£800) each and lowering fees for smaller artists.
“I do think as an industry, we probably do have to absorb a bit better and think a little smarter at what is the add-on fee,” Rapino acknowledged. “Because I think, I think, although it’s justified, I don’t think it’s justified probably at every ticket price point. At Live Nation, we’ll look at the lower end ticket prices in the theater and clubs and say, can we also scale them back and make sure [there’s] a defendable fee on a service, on a ticket price. It’s been too easy to add a dollar to the service fee.”
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