Temporarily addressing concertgoers’ long-standing gripe about excessive surcharges, Live Nation Entertainment announced Monday it was eliminating service fees on tickets to shows in its 50 U.S. amphitheaters during the month of June.
The initiative, which expands on a more limited promotion by the company in 2009, will cover nearly 8 million tickets for more than 700 shows by 110 acts. Ducats will be available exclusively through the firm’s website, LiveNation.com, through June 30.
The pricing policy does not affect shows at Live Nation’s House of Blues clubs or smaller venues such as the Hollywood Palladium. The company notes that “parking, shipping and other non ‘service fee’ costs may apply.”
“A fan in every seat is our mission this summer,” Live Nation president-CEO Michael Rapino said in a statement. “We know that’s tough in this economy, so it’s our job to find a way to make concerts more affordable.”
The “No Service Fee June” program expands on Live Nation’s 10-week “No Fee Wednesday” offering last year, which waived fees on millions of lawn tickets sold on Wednesdays for the company’s amphitheater events.
The company initially took heat for that promotion after it was learned that parking and facility fees were still tacked onto the discounted ducats. Those charges were later dropped.
“Live Nation indicated that they saw very sharp sales spikes on those days,” said Gary Bongiovanni, editor-in-chief of PollStar, which tracks the concert business. Bongiovanni added that by announcing the new policy early on, Live Nation, which he says more or less “controls the outdoor amphitheater market,” is not so much testing the summer waters as staging a preemptive strike.
“These fees are not looked upon favorably by the public, which doesn’t know why they vary so much from one show to another,” Bongiovanni said. “So people don’t know exactly how much a ticket will cost until they’ve gone through the buying process. That $40 ticket might have become $60 along the way.”
The announcement comes in the wake of high-profile tour postponements by major acts like U2 and Christina Aguilera that will undoubtedly erode the summer concert market. Reports of lukewarm advance sales for certain summer tours accompanied those developments, although Jason Garner, CEO of concerts for Live Nation, told Daily Variety that it was business as usual.
“Ticket sales are on par with our expectations for the year,” said Garner. “Every year, 40% of tickets go unsold, and only 20% of concerts sell out. … Our goal is that by waiving the service fee for the month of June we can motivate the fan who couldn’t otherwise attend a show this summer.”
The promotion would save ticket buyers about $12 to $13 off the average ticket price, according to Billboard.
Bongiovanni indicated that some headlining tours were experiencing “surprising softness” but would not mention any names. “I think that’s gotten some people’s attention,” he said. “It’s a very competitive marketplace out there this summer, and people have to make some tough decisions.”
Live Nation’s June promotion is the first to follow the Justice Dept.’s January approval of the Live Nation-Ticketmaster merger (Daily Variety, Jan. 26). During 2009 hearings on the deal, opponents had voiced concerns that the union of the two companies would result in skyrocketing ticket prices.