Canadian Authorities Ratchet up Criticism of Ticketmaster/LN Drip Pricing
IndustryLegalTop Story March 28, 2018 Sean Burns
The back-and-forth between Canadian officials and Ticketmaster escalated this week, as The Commissioner of Competition hit back against the ticketer and parent company Live Nation after they claimed their “drip” pricing practices were industry standard rather than deceptive for consumers.
“Any bald suggestion that consumers would somehow be able to divine the actual cost of tickets before the Respondents choose to reveal them is simply incorrect,” the commissioner said in a response filed Tuesday with the Competition Tribunal, according to The Canadian Press. “Many other e-commerce companies, when promoting other products to consumers, present prices that are in fact attainable as the first price consumers see.”
Ticketmaster and Live Nation were first targeted by Canadian authorities for the practice of “drip pricing” in January. Drip pricing is the method through which one price is shown to the consumer as a stated value for an item, only to stack fees on top of that at the final moment before a purchase is made – often after a buyer has made up their mind. The Competition Bureau filed suit against the entertainment giant in January, which was followed in short order by a class action lawsuit brought by Michael Lindenbach.
In its review of the marketing practices employed by Ticketmaster, the Bureau found that Ticketmaster’s fees generally inflated the price of tickets by more than 20 percent. In some cases, the fees amounted to more than 60% of the originally stated value. It requested the Competition Tribunal order the practice be stopped and the companies be hit with penalties.
While it did not respond to a request for comment made by The Canadian Press this week, Ticketmaster and Live Nation have fought the claims vociferously, claiming that their pricing system is “standard in the ticketing industry,” “transparent, pro-consumer and proper.”
“Ticketmaster never suggests or implies that there are no fees associated with a consumer’s purchase. The opposite is true,” it told the Tribunal. “Consumers who purchase tickets online are aware that they will pay fees above the unit price of a ticket.”
Where the fees fairness question will land as the officials and the largest entertainment company in North America go toe to toe is anybody’s guess. Ticketmaster is accurate in saying that its practices of piling fees on top of whatever random number may be assigned as “face value” for that given moment has been resigned to by most consumers. At the same time, even Live Nation’s Chief Executive Officer has admitted that those fees are sometimes “not defendable.”
Last Updated on March 28, 2018 by Sean Burns