I was recently at an ETF conference in Miami Beach, and one night a few of us noticed that Bruce Springsteen was playing up the road in Hollywood.
We kicked around the idea of going, until someone said that ticket prices were likely $1,000 and up for the sold-out event.
We went out to dinner instead.
If you’re an old-school rock concertgoer like me, and you’re chagrined at prices for Bruce Springsteen and even Beyonce and Taylor Swift tickets well north of $1,000, you’re not going to see any relief any time soon.
Ticket seller Live Nation on Thursday reported astonishing numbers: fourth quarter revenues at $4.29 billion were up about 60%, well north of the $3.6 billion expected. Full-year revenues were up 44%.
You’d think people would balk at the ticket prices? No way. Attendance in 2022 was up 24%. Upwards of 121 million fans went to 43,600 events.
And they’re not stopping. Ticket sales so far in 2023 are over 50 million, up 20%.
Top priority
“Our research consistently tells us that concerts are a top priority for discretionary spending, and one of the last experiences fans will cut back on,” Live Nation said in a press release.
Here’s something interesting: In both ticket sales and prices, the majority of the growth came from international markets. Live Nation said this reinforced “the global nature of untapped fan demand and the opportunities we have for growth.”
Regarding the high ticket prices, Live Nation addressed the problem directly:
“We believe that greater transparency on the entire ticketing ecosystem will improve the industry, and we have been engaging with policymakers to advocate for reforms. The biggest challenge facing the industry is chaos at the onsale, where fans cannot get the tickets at the price the artist sets, yet they see pages of secondary sites with tickets 5 times face value because of scalpers.”
Live Nation made several suggestions to combat this, including that artists should decide resale rules. “Selling speculative tickets should be illegal so scalpers cannot use deceptive tactics to trick fans into spending more or buying tickets the seller does not actually have,” Beverly Hills, Calif.-based Live Nation said.
Good luck with that. Here’s the main problem: for certain acts, there are far more people who want to go than there are tickets available. Scalpers presumably sell the tickets to willing buyers, and if there are not willing buyers at a certain price, then the price will come down.
In a normal market, prices rise to meet an equilibrium between buyers and sellers.
Banning markets
That’s called capitalism. You can try to ban it, but should we?
Why do people understand that we pay different prices for coffee, or shirts, or gasoline, depending on quality or demand, but when it comes to music everyone in the country thinks it is their God-given right to take their daughters to see Taylor Swift and pay $35 a ticket and nothing more?
You can try to sell a Taylor Swift ticket for $35, but if someone is willing to stand outside the stadium (like I used to do in the 1970s) and say, “Anyone got an extra ticket?” and when the holder of those $35 tickets says, “I have tickets. How much will you give me?” And the buyer says, “I’ll give you $500 for those two $35 tickets,” is there really a reason to stop that transaction, assuming there are willing sellers and willing buyers?
Does the fact that there is now an electronic marketplace and a broker who stands between the transaction — we are not physically standing outside the stadiums anymore looking for tickets — change the nature of that transaction? The evil scalpers are selling the tickets to someone. If there’s no one willing to buy, the prices go down.
Should we stop that kind of transaction, when we obviously allow it for every other transaction? There are coffee brokers. And gasoline brokers. And don’t even get me started about stock brokers. Why are ticket brokers suddenly the Darth Vaders of the brokerage world?
The solution is to either 1) allow the marketplace to function based on supply and demand, or 2) demand that Taylor Swift and the others put on 10 times as many shows to satisfy demand, or 3) dramatically reduce the size of the fan base so most of the former fans could care less about going.
Which is why we went out for dinner that night in Miami, instead of going to hear Bruce.