Ticketek blames artists and venues for high prices, hidden fees

Live events giant TEG says artists are to blame for high ticket prices, venues responsible for hidden fees, and that dynamic pricing is important to fighting scalpers.

Addressing a parliamentary inquiry into the Australian live music industry, Tim McGregor, global head of touring for TEG, which owns Ticketek, described the industry as highly contestable and in which ticket sellers have limited flexibility.

This is at odds with statements made to the inquiry by Humanitix, a not-for-profit ticketing company that said big companies have locked it out of getting contracts for large stadium tours, and created “a localised monopoly style of business”.

TEG say artists and venues are largely responsible for high ticket prices and hidden fees. Credit: Ben Rushton

Australian musicians earlier this year called for an investigation into corporate players in the live music industry in a bid to stamp out “anticompetitive” practices that leave them struggling to make a living.

McGregor said when it comes to pricing, TEG is the intermediary and carries the financial risk of a tour failing.

“Artists generally control ticket pricing,” he told the inquiry.

“Agents come … to set out stadium, ticket prices, sponsorships, production requirements, size of tour party, hotel and airline requirements. We make recommendations, of course … but ultimately the artist must approve them and is often highly prescriptive.

“[Contracts] typically involve a minimum financial guarantee and typically additional 85 to 90 per cent of the share of the profit going to the artist.”

Often customers are asked to pay fees on top of the base price, which can include service, booking, transaction, facility and infrastructure fees.

McGregor said venues were largely responsible for those fees, except for service and handling fees, and defended them as “per transaction, not per ticket”. He said Ticketek was looking into how AI could further automate the booking process and decrease the charge.

The federal government has announced it will ban dynamic pricing, in which a price changes during the transaction in response to demand. McGregor defended dynamic pricing as a way of stopping scalping.

McGregor said adjusting the cost of a ticket after initial sales could reduce the profit margins of scalpers reselling tickets en masse.

Dynamic pricing saw ticket prices skyrocket at the Australian Open. Credit: Eddie Jim

Humanitix co-founder and chief executive Adam McCurdie told the inquiry on Friday morning dynamic pricing should be made illegal.

“Dynamic pricing should not be allowed, it’s not good for consumers, it’s a horrific experience, and it’s an incredibly one-sided situation,” McCurdie said.

Humanitix donates profits from service fees – which is generally 4 per cent plus 99¢ per ticket – towards charitable education projects.

McCurdie said his company had been locked out of contracts for major stadium tours, with large players such as Ticketek and Ticketmaster making deals with stadiums and offering millions of dollars upfront to get long-term exclusive rights to be the ticketing partner.

“That’s a very common dynamic,” he said.

On Monday, the inquiry will hear from Live Nation Australia. Live Nation is the world’s largest music promoter. 

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