Consumer Alert: Here’s where your money is really going when you buy a concert ticket

It’s concert season, and this consumer alert takes a look at where your money is really going when you buy a ticket.

On Thursday, the parent company for Ticketmaster was one of many companies that met with President Joe Biden to talk about junk fees. How I wish I could report that Ticketmaster agreed to get rid of them. That’s not the case. But it did promise the president it would reveal all those fees up front, instead of the way they do it now, as an unpleasant surprise at checkout.

Let’s say you paid a thousand bucks to see Taylor Swift in concert. On average, about 30 percent of that price is for fees, about $300. But there have been many reports of the fees being more than the ticket itself. And the ticket behemoth, Ticketmaster, has raised the ire of concertgoers around the world.

Ticketmaster is owned by Live Nation Entertainment. Live Nation functions as a promoter and owns more than 400 venues across the country. And industry experts say as many as 80 percent of the venues Live Nation doesn’t own have exclusive contracts with Ticketmaster. So, when the money is doled out for that ticket you bought, it goes into the hands of Live Nation shareholders many times over.

Let me explain the fee structure. When you buy a ticket, the first price is the face value, which is determined usually by the promoter or venue. Often Ticketmaster is acting in both those roles. Dynamic pricing is used, which means the more popular a show, the higher the price. Then there’s the service fee that Ticketmaster collects, and it solely determines the amount of that fee. The processing fee is collected for printing physical tickets. Ticketmaster charges the delivery fee for getting the ticket to you. The facility charge is the cost for using the venue. Again, when Ticketmaster owns the venue, it keeps that fee as well. And lastly there are taxes, which are generally included in the face value of the ticket.

President Biden has been railing about junk fees for the last nine months, and he’s not alone. A bi-partisan bill has been introduced in Congress that would mandate that fees be revealed up front, not when you’re about to check out. It was under that pressure that Ticketmaster and others agreed to do just that.

But unless that bill is signed into law, Ticketmaster’s compliance with transparency is voluntary. Will this transparency lead to lower fees? Probably not. As long as concertgoers keep buying, Ticketmaster will keep charging. But at least now we’ll know up front.