Make concerts affordable again — here’s how

Concert ticket costs have become a national crisis — so much so that the Department of Justice has filed a lawsuit to break up Live Nation, which owns Ticketmaster.

Twenty-seven state attorneys general are still pursuing a legal course to break the two companies up.

At this stage, that’s just overkill.

I have a simple solution to resolve the issue. But to understand that solution, you must first try to understand the problem. 

I have been doing just that after being involved in the music industry, and now providing financial advice to many clients in the industry. 

Concert ticket costs have become a national crisis — so much so that the Department of Justice has filed a lawsuit to break up Live Nation, which owns Ticketmaster. REUTERS

The proposed breakup of Live Nation, which controls many concert venues, and Ticketmaster, which is used for most venues to issue their tickets, appears to be a standard antitrust action against a monopoly.

But separating the two entities, at this point, may be nearly impossible. 

Live Nation makes a small percentage on promoting concerts. That percentage is always negotiable, but most of the ticket price goes to the venue and the artist.   

The way the company makes its money is on ticket fees  — Ticketmaster. If you review that company’s financial statements, which can be done on the Internet, they actually lost money two of the last three years on their concerts.  

Moreover, though Live Nation controls a sizable portion of the promoters’ market, that may not be the worst thing for the public. In days past, concert promotions were left to individuals who were often unscrupulous.

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As a record label controller and tour accountant for the then-largest tour in the world, I experienced that nearly 50 years ago. We received a substantial cashier’s check for our guarantee from the promoter of our Detroit concert prior to a show. The cashier’s check was fake. 

That was how the industry was for many years. Live Nation has cleaned up that side of the business.

It’s not the companies currently driving our soaring prices. It’s the artists.

Live performances have become the artists’ major source of revenue. Their revenue from album sales has dried up. They are living on fees from music apps like Spotify and Tidal. And though Spotify pays huge sums in royalties, only a relatively small amount makes it to artists. 

ASCAP and BMI are still collecting royalties for radio, and from venues playing music, but that is not enough to feed the deserving artists who have created the music we love. 

The bottom line is that artists make their money when we pay to see them. They used to do concerts to promote their CD sales. Now they do it to pay their living expenses.  

I have been stunned by the prices. Having seen Elton John at the Troubadour and Bruce Springsteen at the Roxy years ago for a pittance, it is jaw-dropping. 

The fabulous Bruno Mars was the first-ever act at the Intuit Dome. Four tickets for our family? $1,750. 

I saw the Paul Simon farewell tour years ago. Somehow, after that goodbye, he is playing again at the Hollywood Bowl this summer. I looked at the ticket prices and barfed. 

A rough estimate of the box office on that one show is $2.5 million or more. You don’t have to be a math professor to understand why he’s performing at age 84. 

Many industry insiders I spoke with cannot figure out who is buying the tickets for such outrageously priced concerts.

One person said the folks paying more than $2,000 for Taylor Swift concerts were forgoing eating out, and not attending mid-level band shows. 

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Those bands, in turn, are being squeezed because demand has dried up while the big names are soaking up substantial portions of the concert money pie.

When tickets sell on the secondary market, artists are upset that people are profiteering off them. That has driven the initial price for tickets higher, as the artists or the promoters believe that they should be the ones profiting — not some freeloader on StubHub.   

So, what is my solution? Stop buying the tickets. 

This is a free market. If people stop buying, the industry cannot charge the current freight. We all make choices where our hard-earned dollars are going.  

A younger friend of mine called me while I was conceiving this column and he told me he had independently come to the same conclusion. He wants to see Bruce Springsteen on tour in Austin, Texas. He looked at the prices — and he said no way. 

He also wanted to take his young daughters to see Bruno. After seeing the cost of tickets, his daughters will just have to wait.  

And so the answer to high prices is not more lawsuits.

Rather, it is simply to stop going to concerts until prices come down.

The solution is in our hands. Supply and demand — basic economics.

Bruce Bialosky, a two-time presidential appointee, is a certified public accountant specializing in taxes.