Exorbitant, crazy: that’s how Taylor Swift fans and observers describe the cost of resale tickets to her Toronto shows. We’re talking $2,000 and up. The resale market is “uncontrolled” and “opaque,” observers say.

Why are Taylor Swift resale tickets often priced 10 times their face value? Is it the fault of the resale sites, the promoters, Ticketmaster , the elected officials or the artists themselves? We asked several observers.

Who sets the ticket prices and who profits?

There are two markets in ticket sales: the primary market, when the artist puts tickets on sale for his tour, and the secondary market, which is the resale market. Artists determine the base price of tickets for their shows, the multinational Live Nation Entertainment , which also owns Ticketmaster , defends itself on its website . The ticket sales platform and the amphitheater usually pocket the service fees.

Typically, the promoter will guarantee the artist a certain amount of money for a concert. The artist may also get a cut of the ticket sales, depending on the contract, says Laura Simpson, CEO of Side Door, a ticketing platform for small and mid-sized venues. Even though Swift gets 80% to 85% of the revenue, she also has to pay for the huge production , whether it’s the musicians, dancers, stagehands or others, adds Kelly Ho, a financial planner at the firm DLD.

Does the artist also get a cut of the secondary market? [Whether the resale takes place on Ticketmaster] depends on the deal they sign , Simpson says. As for other platforms like StubHub , the artist is not paid if a fan decides to resell their tickets there. On the other hand, singers and promoters generally have batches of tickets reserved for them, and they can offer them on the secondary market, underlines Normand Turgeon, honorary professor of marketing atHECMontreal.

In a 20,000-seat venue, about 10% of tickets are reserved for the general public, says Professor Turgeon. The other tickets, he explains, are sold through pre-sales or promotions for credit card companies and others or reserved for the artist’s fan club, among other things. The secondary market, he adds, is dominated by professional resellers. He estimates that only 5% to 10% of the seats currently listed for resale on StubHub , for example, to see Taylor Swift in Toronto, belong to ordinary people who can no longer attend the concert and want to part with their tickets. This is without mentioning dynamic pricing (prices that fluctuate according to supply and demand), used by resale sites, notes Professor Turgeon.

Fans Trapped?

If a fan is not lucky enough to get their hands on a pre-sale ticket, they can turn to the resale market, but prices there can be very high. Ms Simpson would like to see more transparency in the industry. But it does have some caveats. I don’t want to defend Ticketmaster, but the demand for Taylor Swift is such that you have to create software to manage it, not to mention the [computer] threats and scams, she says. Obviously, that requires investment. She also points out that the cost of touring has tripled since the pandemic, and artists can no longer rely on album sales to make a living. Putting on a high-profile show like Taylor Swift’s costs millions of dollars, adds Professor Turgeon.

How to Pay Less, According to Kelly Ho

• Monitor resale sites for “bargains,” which can occur the day before the concert, the day of the show, or even after the show has started, if a reseller lowers their price to get rid of an unsold ticket.
• Plan ahead and buy tickets in advance if you’re a member of the artist’s fan club or have a credit card that offers a promotion, she says.
• Working part-time for lecture halls.

The resale market is certainly a profitable industry , says Professor Turgeon. But let’s not forget, he says, that there are also financial risks for professional resellers. “There are going to be tickets that go unsold ,” he notes. In other words, some concerts are going to make a lot of money for resellers, others aren’t. Some resellers, however, are making a lot of money , according to Ms. Ho, who cites the example of a Taylor Swift ticket with a face value of $500 being resold for $4,000.

Taylor Swift vs Billie Eilish

In the case of Taylor Swift’s Toronto concerts, Ticketmaster did not offer resale tickets. In addition, the platform had blocked the exchange of tickets until 72 hours before the shows, following cases of fraud. Hundreds of tickets still ended up on resale sites, at high prices. The resale market has gotten out of control , says Stephen Parker, CEO of the National Independent Venue Association (NIVA). He is part of the Fix the Tix coalition , which aims to tighten regulation in the United States.

He points to resale sites like StubHub and Vivid Seats, which he says empower professional resellers and their software robots, called bots, and which have lobbyists in Washington to defend them. Mr. Parker salutes artists like Billie Eilish, who has chosen to block ticket exchanges for her current tour, except at cost, on Ticketmaster. Taylor Swift’s promoter AEG did not respond to our request for comment.

Note that tickets for Billie Eilish concerts, including in Vancouver in December, are currently listed on the StubHub site. The company explained itself in an email: We respect the artist’s right to decide how they want to sell their tickets, but we believe that consumers should not be forced to purchase their ticket from a single primary seller or be restricted in what they want to do with a legitimately purchased ticket.

This is exactly the type of anticompetitive behavior alleged in a complaint against Live Nation – Ticketmaster that the [US] Department of Justice is investigating , adds StubHub , which adds that its customers are always refunded if the ticket purchased is not valid.

Mr. Parker accuses StubHub of not checking in advance whether a reseller actually has a ticket that it puts up for sale on the platform, citing the example of tickets for the Oasis tour being posted on the site before the presale even begins. StubHub counters that sponsors, in particular, have tickets before the presale.

A price cap?

Mr Parker said the real solution would be to impose a cap on resale prices. He admits in the same breath that his association,NIVA, does not propose such a measure on a national scale in the United States, because it would not be “politically possible” at present, due to pressure from resale platforms like StubHub. Ticket resale sites have opposed a cap in the past, saying consumers would be less protected against the risk of fraud because resellers would turn to platforms like Kijiji or Facebook Marketplace .

In Ontario, the previous Liberal government wanted to cap the resale price of a ticket at 150% of face value. But Doug Ford’s government cancelled that cap after taking power in 2018, arguing, among other things, that the measure would be impossible to enforce. Other experts have suggested tickets with a nominative name, with the possibility of exchanging with another fan only at cost price. However, this system would be more expensive, particularly for the verification of the identity of fans at the entrance to stadiums.

The unprecedented demand for Taylor Swift tickets is an anomaly in the market, Ho said. For some shows and sporting events, fans may even pay less for their resale ticket than its face value. Like Mr Parker, however, she believes that the multinational Ticketmaster – Live Nation should be split up. It is a quasi-monopoly , says Professor Turgeon, who points out that the megacompany holds interests in more than 300 performance halls, in addition to handling promotion and ticket sales.

Rogers owns the Rogers Centre in Toronto . But Live Nation is building a new outdoor amphitheater in Toronto, called Rogers Stadium, in partnership with Rogers , which will host acts such as Oasis and Coldplay next summer . Live Nation and Vivid Seats did not respond to requests for comment.

MICHEL BOLDUC –  CBC RADIO
PUBLISHED NOVEMBER 19, 2024