Live Nation Executives Consider Raising Ticket Prices
Concert promoter, Live Nation Entertainment, completed its merger with Ticketmaster back in January, and already the company is considering plans to raise ticket prices.
According to the Los Angeles Times, after seeing profits decline in the first quarter of the year, Live Nation Entertainment Chief Executive Michael Rapino has suggested that raising the face value of ticket prices would be a more effective strategy than seeking profits through service fees. "Our fundamental believe at Ticketmaster/Live Nation is the answer to grow our business is less about trying to make $5 or $6 million in service fees off secondaries and much more important to figure out how to capture that $1 billion in up-sell and on the face value of tickets," Rapino said.
Rapino attributed part of the company's profit decline to losses from its brokerage site TicketsNow.com, which made headlines last year for offering sold out concert tickets to Bruce Springsteen fans for a substantial markup. TicketsNow was forced to unlink from Ticketmaster.com, which Rapino says caused approximately $13-$14 million in profit losses.
Although price increases are still in the discussion stages, Rapino explained that the company is also considering new business plans that will give concert-goers the ability to pay extra for options like seat positioning in aisles. "So whether it's seat maps, dynamic pricing or just convincing the band that the front row is worth $400, not $100, we're noticing a great reception by artists worldwide who would like to capture more of the upside, and our first goal is to figure out how to price the house right," he said.
Rapino's new business pitches come contrary to statements he made last year, emphasizing the importance of affordable ticket prices. "In my business, the cheaper the ticker price the better," he told the New York Times in February 2009. "I'd love for more consumers to walk into an amphitheater, park, have a beer and eat a hot dog. There's no advantage to me to have anything but sold-out shows."