Battle of the Beasts: Profit vs Prosperity
The stage lights dim, and the crowd lights up: a concert. But for many, the dream of hearing the crowds roar and watching the lights flicker remains out of reach. Locked behind a wall of ruthless resellers and soaring ticket prices, soaking in the music remains just that – a dream. Music festivals such as Lollapalooza and Coachella continue to dominate a large aspect of the cultural landscape, causing a fierce battle between resellers and enthusiastic fans for that one ticket.
At the core of this battle, a pressing question arises: should concert ticket prices be regulated? The accessibility of live music should not be given to those with the deepest pockets. In an industry that is speculated to reach a revenue of 36.71 billion USD by 2027 (Statista, 2023), regulating ticket prices could potentially result in an economic downfall but also increase satisfaction in fans by making it more accessible. One potential solution that has gained popularity in the economic market is the introduction of price controls aimed at curbing skyrocketing ticket prices. In the context of music festivals, price controls could take the form of limiting the reselling markup, capping the face value of tickets, or mandating a maximum price on the secondary market.
The biggest argument for this tactic is accessibility. The introduction of price controls in the secondary and primary markets of concert tickets can help ensure accessibility. When tickets are solely based on market demand, they will follow the economic law of demand and supply. When demand increases, prices increase as well. This narrows the target population significantly, allowing those with strong financial backing to attend. Price controls level the playing field, allowing a broader audience to experience these events without being “priced out.” Furthermore, regulating these prices could help curb the threat of scalpers and bots, an industry projected to reach a revenue of 43.17 billion USD by 2028 (Market Research Reports, Industry Analysis, Business Overview & Trends – 360 Market Updates, 2023)
However, despite the potential benefits, enforcing price controls in this market does open doors to multiple challenges. An immediate concern is that price ceilings may create unintended shortages. If a ticket is priced too low, its demand could exceed supply. This leads to long waitlists, lotteries, or a first-come-first-served system that does not necessarily ensure fairness, nor does it ensure accessibility. Another problem that arises is the logistics of imposing jurisdiction on a market that operates online and across borders. Tied with the impact on music festival organizers, who might suffer if the costs of planning and organizing the event are not recouped through ticket sales, it could lead to a decline in the quality of shows put up, erasing the experience and economic worth of the concert altogether. These issues become even more complicated when considering the role of the resale market, where prices reach new highs way beyond face value, further complicating the regulation landscape.
The resale market has become an integral part of the ticket economy. Many people who purchase tickets earlier resell them to gain profit or if they cannot attend. While this market provides liquidity and flexibility, it also leads to the exploitation of scarcity and demand. A large number of websites such as Stub Hub, SeatGeek, Ticketmaster, and Viagogo have capitalized on this, creating a secondary market where tickets can be traded at market-driven prices. The argument presented by such industries is that they provide a valuable service by allowing fans a legitimate way to buy and sell tickets. However, Ticketmaster reports it aims to make two percent of the average ticket price in profit. In 2018, a US Government Accountability Office report found that primary and secondary ticketing companies charged roughly 30% of the original ticket price (Feldman, 2024) Thus, these marketplaces do contribute to price inflation. Inflation at the cost of innocent and ordinary concertgoers. While certain music festivals have experimented with controlling this beast of a market by partnering with official resale platforms or issuing tickets that are not transferable or tied to an attendee’s name, they reduce scalping to an extent but also create major inconveniences for those with genuine circumstances and cannot attend the concert.
Ultimately, the challenge of regulating concert ticket prices lies in balancing market efficiency with accessibility. Price controls when implemented effectively would help democratize access to large music festivals and limit the activity in the resale markets. A more nuanced perspective could incorporate an amalgamation of moderate price caps, increased transparency in the initial sale process, and better regulation of the resale market. This would pave the way for a competitive and fair marketplace while preventing the most ruthless forms of exploitation. Additionally, creating more equitable ticketing systems, such as tiered pricing or discounts for low-income attendees, furthers socioeconomic diversity and accessibility without compromising the financial viability of these large-scale events.
The battle over ticket prices is more than just another consumer issue – it is a matter of economics, where the ruthlessness of market demand and supply clash with the dreamy ideals of accessibility and fairness. Whether through resale market reforms, price controls, or a new ticketing system altogether, the future of live music hangs in the balance. A choice today influences the outcome tomorrow, as it is the beauty and beast of economics that quietly orchestrates who gets to stand in the crowd tomorrow and who watches it as nothing more than just that – a dream.
Edited by Justin Hahm
References
Feldman, J. (2024). Ticketmaster vs StubHub: A Guide to Buying Cheap Sports Tickets Online. Sportico.com. https://www.sportico.com/business/commerce/2024/ticketmaster-vs-stubhub-sports-tickets-buying-online-1234789624/
Market Research Reports, Industry Analysis, Business Overview & Trends – 360 Market Updates. (2023). 360marketupdates.com. https://www.360marketupdates.com/enquiry/request-sample/24931359?utm_source=Linkdinandutm_medium=
Statista. (2023). Music Events - Worldwide | Statista Market Forecast. Statista. https://www.statista.com/outlook/dmo/eservices/event-tickets/music-events/worldwide
What is Ticket Scalping | How To Stop Buying Bots & Scalpers | Imperva. (n.d.). Learning Center. https://www.imperva.com/learn/application-security/ticket-scalping-bots/
Music Festival Economics. (2023). Tseentertainment.com. https://tseentertainment.com/music-festival-economics/
Pitchfork. (2023). The above image shows some of the tours with the cheapest North American tickets available on resale sites as of 7/10/23 based on TicketIQ data [Illustration]. https://pitchfork.com/features/article/the-price-of-pop-fandom/
