THIS WEEK IN CULTURE + THE CULTURE BUSINESS
News Briefing: Ticketing debates and controversies
There have been lots of debates in the live entertainment industry in recent years in relation to ticketing which have often put the spotlight on how the sale and marketing of tickets to shows should be regulated. In this TW News Briefing we run through and explain four of those debates.
ALL-IN PRICING
It’s common in event ticketing for the ticket agent’s fee to be charged on top of the face value price of the ticket. Indeed, in some cases there will be multiple fees. It means the producer or promoter of the show receives the full face value amount of the ticket sale and the ticket agent is paid out of the add-on fees.
In theory this is because multiple ticket agents might be selling tickets for the same show and they might each charge different fees depending on the level of service they are offering. Ticket buyers can therefore shop around to find the ticket agent that has the service and pricing best suited to their needs.
However, in reality that’s not usually how people buy tickets for shows and audience members often find the add-on fees confusing and annoying.
The add-on fees are particularly confusing and annoying if they are only revealed late on in the ticket buying process, so a ticket is initially advertised at the face value price, that’s what’s displayed at the start of the ticket buying transaction, and then at the final stage the extra fees are revealed.
This issue is overcome by all-in pricing, whereby the full price of the ticket – including booking fees – is displayed from the start of the ticket-buying process.
In the UK, there was some debate in the early 2010s about misleading communications around ticketing for theatre shows, because in some cases booking fees were not included upfront. The Advertising Standards Authority investigated, resulting in a wider adoption of all-in pricing.
The ASA rules require all-in pricing where possible and, where it isn’t, clear guidance upfront that there will be additional booking fees.
The rules say, “Quoted prices must include non-optional taxes, duties, fees and charges that apply to all or most buyers. If a booking fee or other additional charge is not optional, ticket prices must include any fee, unless the fee cannot be calculated in advance”.
“If such fees cannot be calculated in advance”, they add, “the ad must make clear it is excluded from the advertised price and state how it is calculated. Quoting the face value of the ticket and stating in a footnote that the price was subject to additional and undisclosed fees is likely to be unacceptable”.
In the US, rules around how ticket prices are communicated differ from state to state but in many places all-in pricing is not the norm.
Or hasn’t been until recently. The practice of only declaring booking fees at the final stage of a ticket purchase has become more controversial of late and more ticketing platforms are adopting all-in pricing, with some supporting a proposed US-wide law that would mandate all-in pricing across the sector.
SECONDARY TICKETING
Secondary ticketing, ticket touting, ticket scalping or ticket resale – where people or companies buy tickets for in-demand shows and then resell them at a mark-up – has proven very controversial over the years, and especially since resale moved online in the 2000s and became a major business.
Both the resellers and the online platforms they use to sell their tickets – like Viagogo and StubHub – have come under a lot of criticism.
Some of the platforms used to claim that they mainly existed to help audience members who had bought tickets intending to go to a show, then for some reason couldn’t attend and simply wanted to get their money back. However, the vast majority of tickets sold on these platforms are sold by professional resellers.
Also, there are now other platforms where people can resell tickets at face value, which are specifically designed to help audience members who find themselves in that situation, meaning the bigger platforms clearly exist mainly to provide a forum for professional resellers looking to make a profit.
How secondary ticketing is regulated varies greatly from country to country. In some countries, it is illegal to sell tickets for shows without the permission of the producer or promoter of that show. In some countries, there is a cap on how much a reseller can mark-up the price of a ticket they are selling.
In some countries there are regulations around how resellers secure and advertise tickets. And in some countries there is very little regulation.
In the UK, there is some regulation. It is illegal to resell tickets for football matches. For others kind of entertainment, including in-demand theatre, comedy and music shows, the resale of tickets is allowed.
However, there are rules around how resellers secure tickets, and there are obligations on resellers and the resale platforms to communicate certain information about the ticket being sold and the person selling it.
Producers and promoters can often also cancel tickets that have been resold under UK law. A ticket is basically a contract between the producer and the ticket buyer, and that contract can include a term that says the ticket is non-transferable. If it is transferred the ticket becomes void.
Obviously enforcing this term is a lot of work for the producer and therefore resold tickets often are not cancelled. However, where there is a risk of cancellation because of one of these terms, the reseller is meant to declare that on the platform where they are reselling the ticket.
National Trading Standards has enforced these rules against individual resellers, resulting in some convictions, while the Competition & Markets Authority has enforced the rules against the platforms, resulting in those platforms changing some of their practices in the UK.
However, critics argue that secondary ticketing is not regulated enough in the UK, to the detriment of both producers and consumers.
The music industry-led FanFair campaign has lobbied for more regulation of secondary ticketing, and there has been support for such regulation within Parliament too, in particular led by Labour MP Sharon Hodgson.
Since 2023, FanFair has been campaigning for an outright ban of for-profit resale in the UK. Although it didn’t go quite that far, ahead of the 2024 General Election the Labour Party did commit to introduce a 10% price cap on ticket resale which would greatly hinder professional resellers.
As of autumn 2024, the Labour government has committed to a consultation on ticketing which will have the ticket resale price cap at the top of its agenda.
DYNAMIC PRICING
In recent years a number of producers and promoters – especially of large-scale music shows – have employed dynamic pricing when selling tickets, utilising tools offered by the likes of Live Nation’s Ticketmaster.
With dynamic pricing, the price of tickets goes up and down depending on demand, similar to how pricing works with flight and hotel bookings.
One motivation for adopting dynamic pricing in the live entertainment sector was secondary ticketing. Producers and promoters saw tickets for their shows selling at significantly higher prices on the secondary market, suggesting they had undervalued their tickets.
With dynamic pricing, rather than resellers benefiting from a surge in demand and resulting surge in price on the secondary market, the producer or promoter financially benefits from that demand. But at the same time, they don’t risk pricing themselves out of the market by setting the initial price too high.
Use of dynamic pricing has proven controversial on a number of occasions, usually when ticket prices for high profile artists surge to two or three times their original price, fans complain loudly on social media and the mainstream media picks up on the story.
In the UK, the controversy around the use of dynamic pricing on tickets for the Oasis reunion shows was particularly notable. It put the practice very much in the media spotlight.
So much so, the UK government has added dynamic pricing to its consultation on ticketing and the Competition & Markets Authority has launched an investigation into the sale of Oasis tickets on the Ticketmaster platform.
Dynamic pricing isn’t illegal and, as noted, is commonly used in the travel industry. However, there are rules regarding how dynamic pricing is communicated to the consumer and that will likely be the focus of the CMA investigation.
The CMA said it will consider whether Ticketmaster has engaged in “unfair commercial practices”; if consumers were “given clear and timely information to explain that the tickets could be subject to so-called ‘dynamic pricing’”; and if people were “put under pressure to buy tickets within a short period of time”, potentially impacting their purchasing decisions.
Beyond any regulation of dynamic pricing, given the backlash around the sale of tickets to Oasis shows – and others – some producers, promoters and performers may be nervous of employing the practice and decide not to do so on PR and reputation grounds.
Another option might be to use dynamic pricing on the highest priced tickets and VIP packages, but not on cheaper tickets.
TICKET LEVY ON LARGE-SCALE SHOWS
There have been calls within parts of the UK music industry in recent years to introduce a small levy on tickets for shows at arenas and stadiums that would go into a fund to support performers, promoters and venues operating at the grassroots.
Since the pandemic, the upper end of the live music sector has fully bounced back, while many in the mid-tier are struggling and the grassroots of live is arguably in crisis.
The ticket levy – based on a system that already operates in France – is one proposal for how to better support those operating at the grassroots. The UK levy proposal is supported by organisations like the Music Venue Trust, Featured Artists Coalition and Music Managers Forum.
Most of the live music industry supports the idea of a voluntary levy, so that promoters and performers playing arenas and stadiums could opt to add a levy to their tickets to support the grassroots, and the large-scale venues would facilitate that process.
However, organisations like MVT, FAC and MMF argue that a mandatory levy would be a better way to address the issues at the grassroots end of live music.
Earlier this year, the culture select committee in the UK Parliament endorsed the idea of the levy and said the industry should try to have a system in place by September 2024. If that didn’t happen, the committee said, the government should look to introduce a statutory levy.
Given the industry has not got a levy system in place, some campaigners are now calling on the government to intervene.
FURTHER RESOURCES
TW Culture’s sister publication CMU regularly covers issues and debates around ticketing in the music industry – you can sign up to CMU on the website here.