This week Sports Fans Coalition filed comments at the FTC for their Unfair or Deceptive Fees Trade Regulation Rulemaking process. The FTC requested information on how consumers are charged excessive fees by companies, especially in the live event ticketing industry. It’s no secret Ticketmaster is among the worst culprits when it comes to charging fans junk fees, and largely because of its monopoly. “We discuss conduct employed by Ticketmaster/Live Nation that falls explicitly within the several categories identified by the agency in the ANPR,” reads the comments before listing a litany of consumer harms imposed by Ticketmaster.”
We first address the issue of drip pricing, or how fans don’t know the actual cost of a ticket until the very end of the purchasing process and are often surprised by excessively high fees. In 2018, the GAO found that on average, primary market fees add 27% to the face value of a ticket, with some fees adding as much as 58% to the price of a ticket. However, SFC’s own survey of NBA home games in the next month shows a worse story.
We went through the buying process for the three upcoming home games for each NBA team and selected the one ticket listed as the least expensive for both primary and resale tickets. In more than 30 instances, Ticketmaster, and its partners, charged more than 50% of the price listed in fees. On average, Ticketmaster charges 49.2% in fees for primary tickets and 34.2% in fees for Verified Resale tickets, proving that left as an unchecked monopoly, Ticketmaster will raise fees on consumers, and that secondary market participants represent Ticketmaster’s only real form of competition. Ticketmaster's fees for primary tickets ranged from 4.68% of the listed price to 183%. These fees can also vary within the venue, such as the Denver Nuggets charging 20.34% in fees for February 2nd's game versus the Golden State Warriors, and 69.17% in fees for February 7th's game versus the Minnesota Timberwolves.
However, SFC goes on to argue that junk fees in ticketing is just the tip of the iceberg. Ticketmaster’s monopoly is the real problem that the FTC needs to solve. Thirteen years after the initial merger in 2010, the live event ticket market remains concentrated, with no new significant competitive entrant on the horizon. The fears of critics of the merger have been realized. Live Nation/Ticketmaster still controls about 80% of a multi-billion-dollar market. Not only do they continue to have significant market power, but over the same time period, the entity has continued capturing more of the market by acquiring more than 30 additional companies in the live event marketplace, each time with little pushback from regulators.
We recommend the FTC take three different actions to address the harms SFC outlined:
- Create a rule mandating all-in pricing
- Conduct a 6(b) Study to investigate the other anticompetitive consumer harms in the marketplace
- Support Congressman Pascrell and Senator Blumenthal’s BOSS Act.