(Reuters) (01/30/04)

By Ray Waddell

Edited By Michael Bennett

NASHVILLE, TN, USA - While the rapid rise in ticket prices during the past decade has finally slowed, many in the concert industry say that a downward trend is doubtful.

"That train has left the station," promoter Louis Messina of TMG/AEG Live says.

Even so, promoters, artists, agents and managers all profess concern about ticket prices, which can soar far beyond $100 for top acts.

"High ticket prices hurt us as an industry," says Don Law, co-CEO of Clear Channel Entertainment's music division.

"We really have plateaued -- and the consumer has responded negatively."

SETTING A TREND

The Eagles are often credited with changing the paradigm for rock concert prices with their Hell Freezes Over reunion tour in 1994.

Still, others consider promoter consolidation in the late 1990s as the catalyst for higher ticket prices.

"I point to 1997, when the consolidation of promoters began with SFX," says Jerry Mickelson, co-president of Jam Productions, the Chicago-based independent concert promoter.

"They paid higher guarantees to control the business, and that led to higher ticket prices. Ticket prices went up 60% from 1997 to 2002."

But three years before that, the Eagles prompted sticker shock across the land by asking $100 or more per ticket in most markets.

Despite the high price, the tour was a virtual sellout.

Actually, Barbra Streisand had shattered the $100 price ceiling a year earlier.

But in 1994, Rolling Stones tickets still topped out at $50, and Pink Floyd was getting $75.

Eagles manager Irving Azoff offered no apologies then, and he remains unrepentant now.

"The only people that complained were the people that were getting in for free," he says.

"If we had known all the flak we were going to catch, we would've probably gone higher."

Azoff points out that the Eagles' ticket price then was "all-in," including facility fees, credit card and service charges.

"We were the best bargain on the road that year."

Consumers did not balk.

So, if nothing else, the Eagles showed the world what the concert market could bear, at least at the superstar level.

In the years since, $100 tickets have become commonplace.

What's more, tickets priced $250 to $350 for "special" concerts, like Paul McCartney or the Rolling Stones, and VIP packages for $1,000 and more are becoming commonplace.

"Now we're way down the pack," Azoff says of the Eagles. "We haven't moved much."

At the same time, service charges, parking and facility fees have been tacked on, to the point where a $35 ticket can easily hit $50.

In comparison, concert tickets in 1993 for such big name acts as McCartney, Bruce Springsteen and the Grateful Dead ranged from $26 for the Dead to a high of $32.50 for McCartney.

If adjusted simply to account for inflation, those tickets today would cost about $33 and $42, respectively -- a far cry from the astronomical rise in prices that's taken place.

A CULTURAL SHIFT

Whomever is to blame, some think high ticket prices have eliminated the adventurous concert-going culture of past decades.

Today's fans typically see only their favorite acts, sources suggest.

"You don't experiment for $50," Mickelson says.

Numbers back that up: Average concert attendance is decreasing, down more than 32% from four years ago, according to figures reported to Billboard Boxscore.

The 2003 average of 3,895 per show was an 8% decline from 2002.

"That is directly attributable to ticket prices," Mickelson says.

"If bands, managers and agents started being more real and looking at that trend, they'd see that the key to the future is more reasonable ticket prices."

CCE chairman/CEO Brian Becker says his company has taken several initiatives to address prices.

The Summer of Live campaign, for example, included a $10 lawn ticket.

"We have done a lot of things to try to accomplish ticket prices," he says.

"Some of it worked, some of it didn't, but we're going to keep trying."

Messina says that if box-office reports were more accurate, the downturn in average attendance would appear even worse.

"A lot of those reports are inflated," he says.

"They don't take into consideration all the discounts, freebies, comps and everything else, or it would look worse."

"Those aren't real numbers ... I know, because I used to report them."

THE TOP TICKETS

Generally speaking, ticket prices for the average tour have doubled in a decade, while the price for the touring elite has gone through the roof.

So when does price resistance begin to kick in?

"It seems that the consumer is drawing the line at $50," Jam's Mickelson says.

"Once the price gets over $50, it becomes a much tougher sale."

In other cases, fans will pay $50 or more to see their favorite artist, then skip another concert they may have been on the fence about.

Some say concert pricing was due for a restructuring a decade ago, when ticket prices fell far below what premier sporting and Broadway events were charging.

In many instances, this is still the case.

Other industry sources say the higher prices enable acts and venues to reap the benefits that often go to scalpers, who for years have charged several times the face value for tickets while contributing nothing to the process.

But decreased per-show attendance, many argue, is clear evidence that fans are voting with their pocketbooks, particularly when touring traffic is high and consumer confidence is low.

"You can't go out and charge $150 to $200 a ticket in a region that has been negatively impacted by the economy," CCE's Law says.

Messina says when he looks at what the National Basketball Association is charging for courtside seats, concert ticket prices don't seem so high.

"But part of me wants to take back down to a level where people can go to more shows each year." I still believe in that."

Others agree.

"What happened to the old adage of putting asses in seats?" Mickelson asks.

"That turned into 'How large is the guarantee?"'

Promoters have long held that ticket prices are a direct function of artist guarantees.

"The promoters are trying to get to a point of break-even with high prices, and the artists are trying to one-up each other simply get paid the most that the market will bear," says Alex Hodges, executive VP at House Of Blues Concerts.

"When you see the shows at arenas with red ink huge losses, you quickly see that the guarantee drove the ticket price up, and then everyone loses: Artist, fan and the promoter pays the tab."

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