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Eammon Forde

Where concert ticket money goes: who's getting rich off live music's golden age?


Artists are criss-crossing around the globe playing the biggest shows and festivals at a time when live performances is the music industry's number one money maker. But whose raking in all that cash? The Guardian's Eammon Forde explores...

This article originally appeared on The Guardian

In 2001, Billboard Boxscore reported that the top 100 music concerts of the year collectively generated $350m. In 2015, the top 25 concerts alone grossed just shy of $360m. There are two reasons behind this: more people are going to shows and ticket prices are spiking sharply.

Here is a topically illustrative example, given that their Joshua Tree 30th anniversary tour is the hottest ticket of the moment. In 2001, U2had the ninth-biggest venue gross of the year in the US, collecting $6.4m from 78,275 tickets sold across four shows at the United Center in Chicago, with tickets priced at $45-$130. In 2015, they had the fourth-biggest gross of the year with $19.4m earned, playing eight shows to 149,942 people, with tickets at $30-$275. At the bottom end, some tickets were cheaper, but the band played more nights to twice as many people and made three times the money. Obviously, inflation has to be factored in, but the contrast between how they toured then and how they tour now is significant.

Of course, gross earnings are far from synonymous with profit. Acts touring today are not just swelling their own bank accounts; there are a lot of mouths to feed along the way. Fans paying $275 for a show might presume most of that is going straight to the band. But it really isn’t. So what, exactly, is your ticket price paying for?

The live industry is rarely keen to draw back the curtain to show its inner workings, so the Guardian spoke to a number of live music insiders who wished to remain anonymous. In doing so, they were able to speak candidly about where, exactly, the money goes.

There are no precise splits that apply in every case as it will depend on the band, the venue, the promoter, the marketing budget and tax laws, among other things. The following is intended only as a general guide to how your ticket price could break down and what it is going to pay for. Most of the things that have to be paid for will apply in almost every case. What will be different is how much they will be paid. And that includes the band members.

Peeling it back layer by layer, of your ticket price, around 10% is going to be swallowed up by a booking fee and processing fee (either posting the tickets or charging you for the “privilege” of printing them at home), with some of that actually working its way back to the band and their promoter.

You also have to take out taxes from that. In the US, about a 5% rate is applied to tickets, but it can be as high as 35% in some European countries due to the addition of “cultural taxes”. A small percentage of the gross – the monies left after transaction fees are deducted – will be collected and paid through, eventually, to songwriters in public performance royalties. The rate will depend on the venue size, but Ascap, which collects royalties, says on its website the figure can start at 0.8% and drop to 0.1% for venues with over 25,000 capacities. Again, as with taxes, there are higher deductions in Europe, with PRS for Music in the UK, for example, collecting 3% of the gross.

What is left – roughly 84% of the gross – then is carved up between the band and their promoter (who puts on and underwrites the show). But there are still more things to be paid for.


Read the full story by Eammon Forde at The Guardian

Tags : The Guardian