How a Ticket Goes From $18.50 to $26.75

Why can’t Pearl Jam put on a concert at any mainstream venue and charge $18, plus no more than $1.80 in service fees?

The main reason: Ticketmaster typically has to collect between $4 and $8 in fees for its own expenses and to maintain exclusive contracts with promoters, retailers and venues.

A typical case: the Stone Temple Pilots’ July 16 concert at the Irvine Meadows Amphitheatre. The top ticket price for the show is $18.50 (slightly more than 50% goes to the band, about 40% toward production expenses and the balance to the promoter). But you can’t buy the ticket for $18.50.

If you purchase a ticket at the Irvine Meadows box office, the venue adds $1 as a facility fee, which it keeps. But tickets are only on sale at the box office on the first day of sales and the night of the show.

Fans unable to buy tickets on those days must go to a Ticketmaster outlet, where the price jumps to $22.75--which includes a $4.25 “convenience fee” for Ticketmaster.

To purchase by telephone, the $18.50 ticket leaps to $26.75--a 45% markup. That price includes a $6.25 convenience fee plus a $2 processing fee for mailing (the processing fee is per order, not per ticket).

Where do these fees go?

Ticketmaster Outlet:

* About $1 goes to Irvine Meadows to subsidize Ticketmaster’s exclusive contract, sources say. (In Irvine’s case, 50 cents of this figure goes to the promoter, whose partner is a partial owner in the building.)

* About 75 cents is paid to retailers that act as Ticketmaster outlets, sources say. (Ticketmaster says it pays about 25% of the fee to retailers.)

* About $2.13 covers Ticketmaster’s operating expenses.

Although Ticketmaster will not disclose how much profit is built into each convenience fee, insiders speculate that the firm earns about 36 cents on each $4.25 service fee charged.

Phone Orders:

Consumers who choose to charge tickets over the phone pay a higher “convenience” fee--in Stone Temple Pilot’s case, $2 more--of which 50 cents is split between the venue and promoter.

The remaining $1.50 helps Ticketmaster defray costs due to credit-card transactions, operators, phone company expenses and the firm’s own phone switching network.