StubHub Sues Ticketmaster, Golden State Warriors, in Battle of Scalpers
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I'm pretty sure they are basically sending most of the money back to the Warriors, which is why they are so adamant about people using Ticketmaster.
They don't want to set up their own marketplace because then they would be the "greedy" sports franchise, so Ticketmaster sets it up and take the heat.
Apparently during congressional testimony they mentioned that venues, and sometimes artists or promoters, get a cut of the service fee. They quote some mid-level promoters that dispute the promoter/artist fee but it doesn't really go into the venue statement. In my experience with small shows, the venue's money is baked into the ticket price, not the additional fees.
"...Ticketmaster’s service charge is, you know, Ticketmaster was set up as a system where they took the heat for everybody. Ticketmaster frequently gets a minority percentage of that service charge. In that service charge are the credit card fees, the rebates to the buildings, rebates sometimes to artists, some- times rebates to promoters. So Ticketmaster has been the—we are like the IRS. We deliver bad news."
There's an interesting history behind how this practice got started, that's a good lesson in how multi-party markets work. Back in the good old days, touring acts typically got a modest percentage of gross ticket sales for a given concert, leaving enough for the promoter and venue to cover costs and make a profit.
At some point (the 80s, maybe?), artist percentages started creeping up closer to 100% (in one ridiculous example, Jimmy Buffet got "105% of gross ticket receipts"), so venues and promoters had to make money on something other than tickets.
Since "ticketing fees" weren't calculated into the gross ticket receipts of which a percentage were due to the artist, they were a green field for exploitation and creative deal-making, like the "promoter rebates" referenced above.
In many cases (almost all venues above a certain size), venues sign exclusive ticketing company contracts that come with up-front bonuses or advances on fee rebates, which make ticketing companies kind of like cash machines (or payday loan vendors?) for venues.
The general public perception of "ticketmaster is evil" is, as with most things when you look beneath the surface, much more complicated than it appears.
Scalping itself is a related but different issue that ticketing companies and venues could certainly limit or end if they had the will, but the system works just fine for them, so there's really not much incentive to change.
[sources: various anecdotes from music industry veterans who will likely deny a lot of the above if pressed ;-]
Pricing: From a seller perspective, selling through the official Ticketmaster channel provides significantly better pricing. For example, if a customer spends $10 on a ticket through Ticketmaster, I will net $9.50 from the sale (5% commission). On Stubhub, if a customer spends $10 on the same ticket, with the way their fee structure works, I would only net $6.01 (an effective 40% commission).
Security: Tickets sold via Stubhub provide a pdf ticket that shows my actual name. Tickets sold via Ticketmaster reissue the original ticket in the purchaser's name.
Is the venue just pre-selling tickets to StubHub or BigStub, or are there scalpers buying that many tickets.
Also, generally there are pre-sales. I get notified about early sales on quite a few events either via American Express or Visa Signature.
For example, if you take a sports business and raise ticket prices to a certain level, you will end up with businesses using it to schmooze. Families stop attending. You lose toy sales. Nobody buys bedding sets with the team logos.
And then one day, there’s a new hot place to schmooze, the businesses leave, and you’ve got nothing, because there aren’t any adults with fond memories of coming to games as a kid.
There's also the perceived unfairness (think what would happen if a popular restaurant doubled its price on Friday and Saturday, people would flip out).
After a while, they realized that a pretty large secondary market had formed for tickets (teams get hot, rival team in town on a Saturday night, etc, etc) and the team / venue wants in on the action. So Ticketmaster created an "official scalper" marketplace to compete with StubHub and friends.
Long, but a worthwhile read on the subject: http://website.alinearestaurant.com/site/2014/06/tickets-for...
"Having either static or dynamically variably priced tables by day of week and time – in a fully transparent manner – simply gives customers the option of paying a bit more for a prime time table or saving a bit of money for an off-prime table. It acknowledges the obvious. No one pays $ 275 for a good seat at a Cubs game, looks up at the nose bleed seats and complains that it’s not fair that those guys up there only paid $ 25. People accept the difference so long as the choice to buy either was their own."
EDIT: There was also some discussion about this on HN a while back: https://news.ycombinator.com/item?id=7853786
The question is, can you force someone to resell a ticket on a specific website? My guess would be that the courts will say no.
Sports teams and sports associations like to be family friendly, which means keeping prices in check. This is partly self-interest - disenfranchise families coming to your games and interest might drop off.
Many bands, though, would like their fans to be able to come and see them regardless of income level and think a first-come, first-served basis is much fairer than purely who can afford the most.
And then there are people like me who think that inserting yourself between buyer and seller purely so you can hold very limited-release goods to ransom is just a shit thing to do.
As a result, you can often sit in meaningfully better seats for less than you would pay to buy directly from the team.
They may not necessarily check ID before a match, but you'd still need to trust a stranger with it. However, I know Arsenal runs a ticket exchange to let season ticket holders sell off individual matches (at a fixed price).