Blink-182 Tickets Are So Expensive Because Ticketmaster Is a Disastrous Monopoly and Now Everyone Pa

Ticketmaster is basically what the pinnacle of American capitalism is (and every VC investor is aiming for), market control to maximize rent extraction

 

Yeah big shows were ok for me when I was younger. Saw the Who at the Tangerine Bowl in 1982 and loved it. But it was just a big party and I had the energy for it and I was willing to put up with all the hassles of it. Nowadays I wouldn't dream of going to a stadium show. No fun anymore.

For the older folks here, if you saw the Who at the Tangerine Bowl in 1982 raise your hand. To this day I still meet people who were at that show.

 

Yep, we recently went to the Kenny Chesney, Old Dominion 5 hr show at RayJay. Good concert but we all agreed, it would be our last stadium show. Wife really wanted to see Chris Stapleton recently but passed, prices were crazy. Same with Springsteen.

 

Damn. I really wanted to go see that show. My mom said no, but maybe next time. Next time was the Police, The Fixx & Kajagoogoo (sp?). That was pretty cool. Did the clash open? I would really like to think NO.

p.s. & FYI:
Jacksonville Beach club drew alternative rock bands Nirvana and more

 

Dang, I blinked and the price went up!

 

No, sadly the Clash didn't play the Orlando show. We had the B-52's and Joan Jett. The crowd hated the B-52's and drove them off the stage after just a few songs. Cindy and Kate were literally dodging beer bottles. As a big B-52's fan, that sucked.

I went to Einstein A Go-Go many times in the 80s. Driving 90 miles and back for a show was another thing I would do when I was young that I'd never do nowadays. But partying with friends on the way there was part of the fun. It's insane what we did, driving back to Gainesville at 2am after a night of partying, and driving through redneck cop territory to boot.

 

NOBODY BEATZ TOPPER HEADON!

 

This has been going on for a long time before COVID. And even now, there’s something mysterious about the model you describe.

Standard supply and demand logic suggests there is a single price that results in maximum revenue, as it is high enough to get each buyer to commit to a premium price but low enough to still allow many people to buy. Let’s imagine the optimal price under this model for some good is $10. A company instead sells it for $1 to generate the sellout and secondary market scalping, but of course they themselves buy every unit to capture the excess profit. Now the company puts up all the units for sale for $100. Should they make 10x the revenue? Of course not, because people aren’t going to buy the product for so high a price. If people were willing to pay $100, the optimal price would not have been $10.

 

If it's true that a rich man leads a sad life,
That's what they say, they say
What does a poor man do with his life,
With nothing to spend, nothing to save?

 

Ticketmaster is basically a middleman though. If they take $3 in fees for every ticket sale, what do they care about the price of the ticket or maximizing the take for promotors, artists, event staff, etc? They win by selling more tickets, and now that they control the resale market, they have even more incentive to create resale opportunities since they take a cut there too. Everyone except Ticketmaster hates Ticketmaster, but they control the turf.

 

Drugs

 

I would have gone with Funko Pops and trading cards, but there's that too

 

The calculus is exactly the same for a middleman. If Ticketmaster sell no tickets, they get no fees for ticket sales. There still should be an optimal surcharge price that would result in the most money for Ticketmaster. If tickets were priced appropriately, that surcharge would have to be low for Ticketmaster to maximize profit.

I’m not saying I like Ticketmaster, but I am saying that this whole thing can happen only if tickets are underpriced from the beginning. And if it’s not Ticketmaster, it’s some other scalpers that profit on the secondary market. Either way it isn’t the artist.

 

I think the idea is that by underpricing the tickets on the primary market, you induce a sellout, generating hype for the tickets and shifting the demand curve to the right. So the profit-maximizing price becomes higher post-sellout than it would be pre-sellout.

It's the proverbial "people want what they can't have."

Conversely, if the tickets were priced at what appeared to be the profit-maximizing price in the first instance, you would likely see demand slump as people started noticing that the tickets weren't really selling out.

The profit-maximizing price also might not (and probably wouldn't) be one that produces a sellout. So then the performance is at a partially full arena, which has a negative impact on the product, further repressing demand for future shows.

Throw in the goodwill generated by selling tickets for a lower price, and a reasonable person could certainly conclude they'll make more money in the long run by leaving some money on the table in the short term.

And just heuristically, they've been at this game for a long time. If higher face prices would generate more money overall, it seems unlikely they wouldn't have figured it out by now.

 

In my experience, fees tend to scale alongside the price of the ticket. I suspect there's some fixed fee + % of ticket price calculation going on. Selling more tickets at higher prices is the absolute maximizing.

 

I had no problems with ticket prices for the Killers in Orlando last month but $16 rum and cokes were ridiculous!
Great live show BTW with Johnny Marr opening and playing with the band for a few.

 

My wife is in Vegas for a conference and her room overlooks the concert area where they are going to headline with a bunch of other bands including Green Day. She texted me the flyer to ask if I knew who they were. I told her to pull up a chair and enjoy from your room because you are going to hear everything through the window.

 

Nostalgia is a hell of a drug.

 

These are probably the best answers that exist for this problem. The long term profit calculation is probably beyond our grasp, but I like your heuristic proof formulation. That said, it’s odd that this model doesn’t seem to occur anywhere else, say with NBA or NFL tickets, which I believe are just plain expensive.

 

I feel like you can’t fight supply and demand. We need more good rock bands.