Ticketmaster Hearing Inspires One Venue Group to Nix Artist Merch Fees

Ineffable Music Group will no longer take a 20% cut of merchandise sales

Guests buy merchandise at the merch booth during a private concert for SiriusXM at The Theatre at Ace Hotel on October 21, 2016 in Los Angeles, California.
The movement against Ticketmaster's fees has only just begun...
Kevin Winter/Getty

Earlier this week, the Senate Judiciary Committee held a hearing to investigate Ticketmaster (and its parent company, Live Nation) and determine whether or not the company is a monopoly. Whether or not the hearing results in any actual consequences for Ticketmaster remains to be seen, but we do have a sliver of good news: Inspired by the testimony from singer-songwriter Clyde Lawrence, Ineffable Music Group has announced it will no longer take a cut of artists’ merch sales at its venues.

“After about an hour watching the hearing, I grabbed the phone and started calling the venues we owned and operated,” Ineffable Music Group CEO Thomas Cussins told Billboard. Per Cussins, Ineffable’s venues — the majority located in California, plus the Chicken Box in Massachusetts — will no longer take their usual 20% venue cut from artists selling merchandise at their shows.

Lawrence outlined the struggles of touring musicians in his appearance at the hearing and explained how Ticketmaster and Live Nation owning such a large portion of the industry is detrimental. He also explained why venues taking a cut of merch sales is unfair, saying, “Another pain point for artists is the significant loss of revenues due to promoter merchandise cuts. Typically, the promoter takes a sizable percentage (roughly 20%) of an artist’s merch sales, and once we factor in our costs of creating and transporting the merch, it can be an even larger percentage (40%) of an artist’s bottom line. The argument is that the venue is providing us the retail space for us to sell our merch. Sure. But we’re providing all of the customers, and yet receive no cut from their many ancillary revenue streams. Live Nation getting around 20% of our gross merch sales while we get nothing on ticketing fees, bar tabs, coat checks and parking passes doesn’t make a lot of sense to me.”

That apparently resonated with Cussins. “We are on the ground and hearing from artists every day,” he told Billboard. “We are seeing how much the costs of everything have gone up — from buses to hotels to flights. So even though the club business is a marginal business, any action we can take to help to ensure a healthy, vibrant concert ecosystem is important. This industry only works if artists of all levels are able to afford to tour. When artists are able to tour sustainably and fans can afford to buy a T-shirt because the all-in ticket price is reasonable, everyone wins.”

He’s right, and Ineffable’s decision is a commendable one, but it’s not exactly going to move the needle when it comes to lasting change. Ten venues deciding to stop taking a cut of merch sales is a nice start, but if the music industry is actually going to become less exploitative of touring artists, Live Nation would need to follow suit at its 259 venues across the country. Something tells us they’re going to be much more hesitant than Ineffable to do so voluntarily.

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