Transcript Ticket scalping goes mainstream

Ticket scalping goes mainstream
By Jennifer Mulrean
http://moneycentral.msn.com/content/Savinganddebt/Finddealsonline/P58727.asp
Sold out!
• Sold out: Two words that strike fear in the heart of devoted
fans everywhere. Or at least they used to.
• Most Net-savvy people know you don't have to stand on a
street corner with a hand-lettered sign anymore to land
tickets to sold-out events. You can turn to your keyboard for
entry to everything from rock concerts and Broadway
musicals to National Hockey League games.
• To attract more buyers, a number of primary ticketing
companies are now trying to legitimize the business. To do so,
they need you to forget that back-alley connotation.
• “Historically, ticket brokers and ticket scalpers have been
sort of lumped in with the dark side of life,” says Carl
Thomas, Tickets.com’s executive vice president of sales and
marketing. “But in the real world, they’re in business serving
a business need every day.”
But is it legal?
• Many consumers are wary because of a labyrinth of state and
municipal regulations on reselling tickets. It's hard to know if
you're breaking laws by buying or reselling a ticket.
• “It’s legal to resell tickets in all 50 states, but in some instances
there may be certain rules and regulations to follow,” asserts
StubHub’s cofounder and president Eric Baker.
• Most states base their ticket-scalping laws on the location of the
venue, not the location of the ticket buyer and seller. This is true
in New Jersey, where you must either be a licensed broker to
resell tickets, or you must resell a ticket for no more than 20%
or $3 more than its face value, whichever is greater, according to
the state's Division of Consumer Affairs.
• While it may feel anonymous to resell tickets online, the office
has brought charges against individuals for not abiding by the
ticket-scalping law. Just this year, they settled with one man for
$20,000 and they have similar cases going all the time.
Sorting through fees and choices
• Peer-to-peer ticketing: This is sometimes called ticket
exchange -- or even “fan-to-fan ticketing.”
• Online auctions: In addition to fan-to-fan resales,
auctions are also an avenue for some brokers to resell
tickets. eBay and Yahoo! Auctions are among the
biggest names in the auction arena.
• General purchases: While you can’t resell tickets at
Tickets.com, you can buy secondary tickets to all kinds
of events through its Premier Ticket Window.
Putting them to the test
Putting them to the test: Sept. 25 Bruce Springsteen concert in Denver
Original List Price = $79.
Site
Ticket price
Cost incl. service fees*
Ticket details
Ticketmaster – primary $79
ticket seller, NOT secondary
$91.05
tickets
Section 118, row 14 -- price level 1 (lower level seating)
eBay
As low as $75
$78.80 (fee of $3.80) Section 105, Row 19, Seat 26
Tickets.com
$251
$251 Section A2, Row 32
StubHub
$225
$247.50 Section A2, Row 32
The Ticket Company $295
$295 Section A2, row 29 (9 rows behind the pit)
GreatTickets
$305 N/A
Section A2, Row 29
*Cost of an adult, general-admission ticket (prices as of Sept. 11). Doesn’t include taxes or shipping
The Economics
• At an event we have
capacity.
• Set a price at $20.
• We have excess
demand.
• Some numbers of
people are willing to
pay more than $20.
• How much can
scalpers make?
Price
D
S
Is this Bad?
50
Scalpers’
Profits
20
Quantity