Ticketing fees seem to get higher every year, much to the dismay of consumers. Whether it’s buying tickets online, at the box office, or through a third-party reseller, there’s almost always an extra fee tacked on top of the base ticket price. These pesky fees have become ubiquitous in the ticketing industry, leaving many wondering – why are ticketing fees so high?
The Breakdown of Ticketing Fees
To understand why ticketing fees are so high, it helps to understand what they actually encompass. Ticketing fees are made up of various charges added by different parties in the ticketing process. Here’s a breakdown of some of the most common fees included in ticketing:
Convenience Fees
This fee is charged when you purchase tickets online or over the phone. It covers the cost of providing this convenience – online ticketing requires websites, mobile apps, call centers, and the overall infrastructure. Convenience fees are typically $5-20 per ticket.
Order Processing Fees
This fee covers the admin costs of processing a ticket order. It pays for the ticketing company’s staff, ticket processing software, and equipment. Order processing fees add around $5-10 per order.
Facility Fees
This charge covers the cost of operating the venue, like utilities, maintenance, cleaning, security and more. Facility fees can be as much as 15-25% of the base ticket price.
Service Fees
This fee goes to the ticketing service as their commission. Primary ticket sellers like Ticketmaster charge service fees to venues and add it onto the ticket price. Service fees are usually around 25% of the ticket cost.
Delivery Fees
If you choose to have printed tickets shipped or opt for mobile ticket delivery, there’s often a delivery fee. This covers the costs of delivery, like postage and handling. Delivery fees are typically $5-15 per order.
Why Are Fees So High?
Now that we see everything ticketing fees encompass, we can better understand the reasons behind the high costs:
Captive Audiences
For popular concerts and events, ticket sellers have a captive audience willing to pay higher fees. Fans have no choice but to pay the fees if they want to attend. This gives ticketing companies leeway to charge higher fees.
Lack of Competition
The ticketing market is dominated by a few key players, namely Ticketmaster. This lack of competition allows major ticket sellers to charge higher fees without repercussion. Consumers don’t have much choice in ticket purchasing options.
High Operating Costs
From secure payment systems to massive venue capacity, ticketing requires complex infrastructure. Ticket sellers pass these high operating expenses onto the consumer through fees.
Venue Deals
Venues allow high ticket fees as part of their deal with ticketing companies. The fees generate profits for venues and ticketing companies alike. Both parties benefit at the expense of the consumer.
Extra Charges
Vague order processing fees let ticket sellers tack on extra ambiguous charges. Ticketmaster has been repeatedly accused of questionable added fees.
Are High Fees Justifiable?
The question remains – are the painfully high ticketing fees consumers pay actually justifiable? Let’s weigh both sides of the argument:
Yes, the Fees Are Justifiable
- Ticketing requires advanced technology and infrastructure to operate. The fees cover these costs.
- There are significant staffing requirements for ticketing companies, from customer service to security. Fees pay employee salaries.
- Order processing, deliveries, venue maintenance and more cost money. Fees cover these operating expenses.
- The convenience of online and mobile ticketing warrants added fees.
- The secondary market depends on large ticketing companies to operate. Their fees subsidize this ecosystem.
- Without the fees, ticket prices would likely be higher upfront.
No, the Fees Are Not Justifiable
- Fees often make up 30-40% of a ticket’s total cost. This seems disproportionately high.
- Order processing fees are unreasonably high given modern automation.
- Ticketing companies already profit from convenience fees, order processing fees should not be exorbitant.
- Facility fees essentially force consumers to fund venue maintenance and operations.
- Service fees create a non-competitive environment.
- The secondary market is fraught with scalping issues. High fees enable this problem.
- Redundant fees like order processing and convenience result in double-dipping.
Ways Ticketing Companies Could Lower Fees
If high fees are indeed unjustifiable, what could ticketing companies do to lower the burden on consumers? Here are some potential measures ticketing companies could take:
Reduce Order Processing Fees
Modern ticketing systems are highly automated. The cost to process an order is minimal, yet order processing fees remain disproportionately high. Companies could lower these fees to more accurately reflect costs.
Include More Fees in the Ticket Price
Service fees, facility fees and more could potentially be included in the base ticket price, rather than broken out as separate fees. This would increase transparency.
Offer Fee-Free Ticketing
Some bands and artists partner with companies like Songkick to offer fee-free ticketing, subsidized by the artist absorbing the fees. This model could be expanded.
Develop a Fee Cap
Capping the maximum percentage ticket fees can contribute to a ticket’s overall cost could prevent outrageous fees. A federal fee cap law could potentially regulate the industry.
Increase Transparency
Simply improving the transparency around what each fee entails would help consumers better understand the charges. More clarity would lead to less frustration.
Utilize a Cost-Plus Pricing Model
Rather than arbitrary fees, ticketing companies could set fees based on actual costs plus a reasonable markup. This could rein in high fees.
The Future of Ticketing Fees
Looking ahead, what might the future hold for ticketing fees? There are a few possible scenarios:
Fees Continue Rising
If ticketing companies face little backlash, fees may continue rising unchecked. Expect even more outrage from consumers if this happens.
Regulation Caps Fees
A federal mandate capping fees would significantly disrupt the industry. Companies would likely lobby hard against regulation.
Pressure Causes Slow Decline
Mounting consumer complaints may gradually pressure companies to lower fees over time. But fees are unlikely to disappear completely.
Disruptive Startups Gain Traction
A trend toward startups offering fee-free or low-fee ticketing could force change. But major players would likely acquire these threats.
Variable/Dynamic Pricing
Companies may turn to demand-based variable pricing, with fees that rise and fall based on event demand. This could help subsidize lower base fees.
Conclusion
The prevalence of high fees remains a contentious issue in ticketing. While ticketing companies argue the charges cover necessary costs, critics claim profiteering motivations. The truth likely lies somewhere in the middle. Though a complete elimination of fees is improbable, more transparency and consumer-friendly practices could help ease the burden moving forward. But with captive audiences eager to see their favorite sports teams, bands, and artists live, the pressure for change ultimately lies with the consumer.
