I see both sides of this argument. Performers don't want to stare at cell phone camera lenses, they want to see and connect with their fans. You can only do that when you see the whites of their eyes. Also, all that money bullshit for some more shallow performers comes into play I'm sure. But I think the core reason is that when you're a professional, performing live in front of a room of people, no matter how big or small, it's a very intimate experience. Seeing that very literal layer of abstraction with someone simply holding up their phones at you and looking at their screens just ruins it.
I also see the side that people want to be able to see and share the performance they paid for later. In a lot of ways it should be a given that you can record something like this. Not only does it make sense nostalgically but it makes sense in a sharing, exposure kind of way. Of course, if the video is shaky and the audio sucks ass, it really does do more harm than good. Maybe venues can offer a professional shot video of the concert and give it to you afterwards? That could rake in some additional revenue as well.
Anyway, I think augmented reality will help. I believe people won't be holding up phones in a few years. They'll be wearing camera lenses on their hats, their shirts, their glasses. This will free people up to experience performances the way they were intended - with their full attention on the performer that's working so hard to make the experience unforgettable.