So-called “junk fees” – including hidden add-ons for concert tickets – are the target of the Biden Administration and Consumer Financial Protection Bureau, which announced today they are taking action by calling for their reduction or elimination. The bureau’s guidance could be the first step toward a national mandate for “all-in” concert ticket pricing.
The first concrete actions were taken today and affect banking: the CFPB issued guidance to eliminate certain overdraft and deposit fees, which it says will save consumers billions of dollars.
More actions can be expected after last month’s meeting of the White House Competition Council, at which President Joe Biden called on agencies to tackle the issue of junk fees for everything from banking services to cable and internet bills to airline and concert tickets, according to a statement from the White House.
As defined by the White House, “junk fees” can be defined as “fees designed either to confuse or deceive consumers or to take advantage of lock-in or other forms of situational market power.”
Falling within that category are “mandatory fees that often hide the full price. Some sellers publish a low price and then add mandatory fees later, at the ‘back-end’ of the buying process or when a consumer tries to terminate the service. … An example is the ‘service fees’ added to the cost of a ticket to a concert or sporting event.”
The White House argues that limiting or eliminating junk fees “have the potential to create more efficient markets by requiring firms to compete on the merits by offering a lower (actual) price or a better product or service.”
Live Nation, the parent company of Ticketmaster, and inarguably among the world’s largest concert promoters and ticketers, quickly praised in its own statement the Administration’s announcement.
“We applaud President Biden’s advocacy for fee transparency in every industry, including live event ticketing,” the company’s statement reads. “Live Nation Entertainment advocated for the all-in pricing mandate passed in New York earlier this year, which requires face-value prices and fees to be shown upfront – and we support the FTC mandating this nationally.
“We operate ticketing marketplaces in 30+ countries around the world and have seen all-in pricing adopted successfully in many countries when mandated across the board. This only works if all ticketing marketplaces go all-in together, so that consumers truly have accurate comparisons as they shop for tickets,” Live Nation’s statement concludes.