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8 September 2022

How Ticketmaster’s dynamic pricing “takes advantage” of music fans

Coldplay, Harry Styles and Bruce Springsteen have profited from ticket prices that rise with demand to many times more than face value.

By Ellen Peirson-Hagger

In late August, when Coldplay announced two live dates in Manchester for June 2023, Jamie Hoyle was keen to buy tickets. Hoyle, 24, a music fan who works at a software start-up, had travelled down to London to see Coldplay the previous week at Wembley – the band’s initial world tour included dates in only the capital and Glasgow. He had had such a great night out that he wanted to see them again in his home city.

On the morning of 25 August Hoyle logged on to the Ticketmaster website. The site told him that there were 400,000 people ahead of him in the virtual queue for tickets. The capacity of the Etihad Stadium, where the band would be playing, is 53,400, so he was resigned to missing out, but after two hours of waiting he got through. The website offered him a pair of standing tickets for £526.30. The price “was just ridiculous”, he said.

Hoyle was expecting to pay around £100 per ticket, the upper end of the cost for one of Coldplay’s Wembley shows, for which standing tickets were £85 at face value, with seated tickets between £55 and £120. Upwards of £250 was far too much. “You can’t treat fans like that,” he said. “You can’t ask fans to spend what is in my case two week’s rent to spend two hours at a gig. It feels predatory.” He didn’t buy the tickets.

What Hoyle experienced on the Ticketmaster website was “dynamic pricing”: when demand increases, so do the prices. Consumers are used to similar algorithmically dictated pricing when buying flights, hotels, or with Uber’s “surge pricing” – where you pay more for a taxi when it is particularly busy. As with these models, the cost of dynamically priced gig tickets will fall as well as rise, decreasing if a gig hasn’t yet sold out a couple of weeks before it is due to take place, for example.

That Coldplay were using dynamic pricing shocked Hoyle, because until he reached the ticketing page he had no idea that would be the case. But Coldplay aren’t the first – artists including Taylor Swift have long used dynamic pricing, and in September Harry Styles fans were enraged to find out it was being used in sales for his 2023 tour. Dynamic pricing is growing increasingly common for arena and stadium gigs, inflating prices that are already prohibitively expensive for many.

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The covertness of the method also annoyed Caryn Rose when, in July this year, she went onto Ticketmaster to buy tickets for Bruce Springsteen’s 2023 tour. “There was no information released. We had no idea what we were going to be facing and then we’re in the on-sale and the prices are crazy,” said Rose, a music journalist and long-time Springsteen fan. Fans were offered tickets for up to $5,500, many times the $300-400 the best seats would have cost at face value. “The difference is astronomical,” Rose said. She described watching prices increase between adding tickets to her basket and getting to the check-out page.

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“The thing about dynamic pricing is that they’re playing with the emotional nature of the consumer,” Rose said. “There’s a finite number of tickets to buy, you have to buy them very quickly, you have to make a decision on the spot. They’re counting on somebody saying, ‘Oh my God, I guess I’ll get these tickets, it’s more than I wanted to pay, but I’m just gonna buy them.’ That’s what they’re counting on, and it works. If it didn’t work, they wouldn’t do that.”

The “they” in this situation is generally acknowledged to be Ticketmaster, the American ticket sales and distribution company, which in 2010 merged with the promoter and ticket seller Live Nation, creating a monopoly that Democrats have urged President Biden to investigate. Artists and their record labels are involved in pricing decisions as well, however. “Promoters and artist representatives set pricing strategy and price range parameters on all tickets, including dynamic and fixed price points,” a Ticketmaster spokesperson told the New Statesman. “Artists and creators retain 100 per cent of the revenue from the original (primary) ticket price, including dynamic and fixed price points.” Ticketmaster’s revenue comes primarily from booking fees.

[See also: How Homogenic brought Björk into focus]

“I won’t try and get Coldplay tickets again,” said Hoyle, who suggested that Ticketmaster’s reputation “insulates” artists from the decisions they and their teams make. He was particularly disappointed after hearing the band’s lead singer, Chris Martin, thank the crowd for coming to the Wembley concert because he knows how difficult it is for fans to get to gigs, given ticket and transport costs. “As a fan, it makes you feel taken advantage of,” Hoyle said.

The London-based alt-rock group Sports Team plans its tours to maximise profit, the lead singer Alex Rice said. They don’t earn much money from record sales, so live shows are important, but there’s a balance to strike. “If the kids didn’t turn up because they felt it was too expensive, there wouldn’t be a fanbase there. We’re conscious of choosing a price they can afford.” Tickets to Sports Team’s autumn tour, which includes dates at the Roundhouse in London and the O2 Guildhall in Southampton, are priced at about £23 each.

Rice sees live music as a vital pastime for young people at a time when social spaces that were available to previous generations, such as youth clubs, are few and far between. Gigs have been growing more and more expensive for years, pricing out many fans. If Sports Team have the power to set their ticket prices, artists that regularly fill stadiums could certainly resist dynamic pricing if they wanted to. “If you’re not concerned about who is able to attend your gigs, then you’re artistically bankrupt,” Rice said.

Jules Jackson of the British indie pop band the Big Moon said she could not understand why influential artists would succumb to dynamic pricing. “Artists of that size are already at the top of their game. They are going to sell out their shows regardless, so to scrape a bit of extra cash out of their fans just feels mean.”

Ticketmaster’s rationale for dynamic pricing is that it stops touts buying tickets at face value and reselling them at higher prices while demand is high for personal profit. “Dynamic pricing is about capturing more value for the artist at the initial on-sale [period],” the Ticketmaster spokesperson said.

Rose agrees that if a fan is willing to pay thousands for a concert ticket, it is the artist who should receive that money, not a scalper. She doesn’t, however, believe that dynamic pricing is an effective way of resisting secondary market sales. “The way you stop touts is you spend money on security experts to look at your traffic and come up with ways to identify bots and other programmatic attempts to get around the system.” Venues might also require gig-goers to show ID with a name that matches that on the ticket, but this requires extra staff and can lead to longer queues on entry. Dynamic pricing might be a cheaper option for ticket sellers and venues, Rose said, but “the touts are still going to be re-selling the tickets”. The New Statesman has found numerous tickets for the Coldplay and Springsteen tours on secondary market websites, many listed for more than £1,000.

The Springsteen debacle in particular caused controversy because for a long time he had resisted having “golden circles” or VIP areas at his concerts. “There was a great democratisation of the floor,” Rose recalled. When he returned to touring in 1999 after more than a decade away, “the first two rows of seats weren’t sold. The crew would go up into the stands, find fans, give them those tickets and move them down there, because Springsteen didn’t want to be playing for some rich guy and his girlfriend sat in the front row.”

Something has changed. “What has live music turned into? Live music didn’t used to be just another thing to consume,” Rose said. “Now it is. For a lot of people it’s a status thing, just like a fancy car or designer clothes.” A concert is somewhere to be seen, and money buys that privilege.

[See also: Nick Cave’s second coming]

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