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This is super sleezy and I think Ticketmaster is one of the most awful companies in the world. But given the ridiculous levels of scalping that goes on every da

This is super sleezy and I think Ticketmaster is one of the most awful companies in the world. But given the ridiculous levels of scalping that goes on every day (including all the companies that attempt to normalize it, like StubHub), doesn't it all imply that the fair market price of a lot of tickets is way higher than what they sell for? Obviously demand is way outstripping supply or people wouldn't pay $500-$1000 for $100 tickets on a daily basis. By making all event tickets available at exactly the same time for an effectively-lower-than-market price, of course professional scalpers are going to snap up almost all of them and normal people without scripts won't be able to compete. I wonder what would happen if tickets went on sale for a really high price (like $500 each) and then the prices kept dropping automatically every hour until they were all sold. That would kill a lot of advantage that the scalpers have. I guess customers would hate it and promoters would hate it, but I wonder if there isn't some other kind of sales model that would make this kind of sleezy self-scalping less profitable. Because with market forces this strong, companies are going to do anything that is legal-ish to get a piece of it. If Ticketmaster doesn't figure out a way to get a piece of the massive resell market, they are essentially just giving away free money to StubHub (from their point of view).

josh2600 8y ago
It's subtly more complicated than this. There's the price people are willing to pay before something is "sold out" and exclusive, and the price people are willing to pay to get access to an experience they can't otherwise get. It's the fact that someone can press a button and get summoned to a show that they wouldn't otherwise have access to that provides some kind of dopamine rush that isn't the same as waiting in line on a website madly refreshing a page hoping for a ticket.
- SilasX 8y ago
  Lesson: If you base your buying decision on whether it's sold out, expect the market to exploit you.
- ageitgey 8y ago
  I agree that is one factor at work, but performers have caught onto this in the last couple of years and have started to offer a lot of exclusive VIP packages to try to capture this price-insensitive market. I'm thinking more about mass scalping for events like Hamilton where every single ticket is bought up instantly by bots for the next four months. There is essentially no way to reliably buy the tickets at normal prices. I tried to buy tickets for Hamilton's touring show and there were hundreds of resell tickets listed on StubHub while I was still trying to get through the process of even seeing if I could find tickets myself. It was completely absurd. A significant percentage of the total available seating must have been scalped. I've done a little work in this space tangentially in the past. The resale market is highly developed with a lot of money at stake and inventory is readily available at every price level and ticket type. Have you ever noticed how every resale site has more or less the same tickets for sale? There are a few middlemen companies that provide the ticket inventory for any reseller to sell instantaneously via API feeds. Stubhub is in both businesses - selling to customers and acting as a middleman to other sellers. It's way more developed than most people think.
  - kbenson 8y ago
    > performers have caught onto this in the last couple of years and have started to offer a lot of exclusive VIP packages to try to capture this price-insensitive market. Artists/promoters have also started using dynamic pricing. Ticket prices might raise or lower after some presales depending on demand. Wednesday the cheapest ticket to the venue might be $49, while on Friday they've raised the price on existing unsold inventory to $69. > I'm thinking more about mass scalping for events like Hamilton where every single ticket is bought up instantly by bots for the next four months. It sucks that the situation is happening, but it's also very easy to fix. Either increase supply, or do something to reduce demand (like raise the price). > I tried to buy tickets for Hamilton's touring show and there were hundreds of resell tickets listed on StubHub while I was still trying to get through the process of even seeing if I could find tickets myself. Some of the is spec listings, where they don't have inventory yet but plan to get some, some of that is brokers/people listing items they've reserved but haven't finalized the process of buying, and some may very well be brokers, or even the venue or promoters themselves listing on Stubhub. If you're an artist, venue of promoter and you want to make more money but don't want to look likeyou're gouging your customers, and you have access to inventory you're allowed to sell yourself, what would you do? That's what they're doing. > I've done a little work in this space tangentially in the past. The resale market is highly developed with a lot of money at stake and inventory is readily available at every price level and ticket type. I've done, and am doing, work in this market. It's like any other, except that the ratio of good actors to those acting a bit excessively is a bit skewed for historical reasons. > There are a few middlemen companies that provide the ticket inventory for any reseller to sell instantaneously via API feeds. It's not that they sell instantaneously via API feeds, they just help push inventory to multiple exchanges, and help sell out the inventory in the point of sale when it sells on an exchange and remove it from the other ones. I'm sure there's software that does something similar for Amazon and Ebay too. I've written about this before here[1], and there's some more detail in that. Specifically, I think the secondary market performs a useful function, as much as it's vilified, as explained in that link. 1: https://news.ycombinator.com/item?id=16379207 https://news.ycombinator.com/item?id=16379207
chimeracoder 8y ago
> This is super sleezy and I think Ticketmaster is one of the most awful companies in the world. But given the ridiculous levels of scalping that goes on every day (including all the companies that attempt to normalize it, like StubHub), doesn't it all imply that the fair market price of a lot of tickets is way higher than what they sell for? Obviously demand is way outstripping supply or people wouldn't pay $500-$1000 for $100 tickets on a daily basis. Yes, and this is the entire reason Ticketmaster exists. Artists and venues don't want to look like they're gouging their fans, so they post lower prices (with hidden fees). These then get resold on the secondary market.
amyjess 8y ago
Another option would be to make tickets nontransferrable and make venues require photo ID before accepting anyone's tickets.
- marban 8y ago
  Which would translate to queues that make airport security feel like a breeze.
  - Barrin92 8y ago
    let's use face recognition for it, maybe we can put it to use for something that isn't policing
    - ageitgey 8y ago
      Maybe you are joking, but there are several companies trying this, like https://zenus-biometrics.com/ https://zenus-biometrics.com/
      - Barrin92 8y ago
        I wasn't joking at all. Tokyo is gearing up to use face recognition to process people at the 2020 Olympics as well. https://www.theverge.com/2018/8/7/17659746/tokyo-2020-olympic-games-face-recognition-nec https://www.theverge.com/2018/8/7/17659746/tokyo-2020-olympi... Also you made a python face recognition library right? I like it a lot, so thanks for making it!
- MrMember 8y ago
  I've been to a few shows that have done something like this. The credit card I used to buy the ticket was used as my "ticket" to get in to the show.
  - oh_sigh 8y ago
    Scalpers can just buy tickets with prepaid credit cards and send those to the buyers
forgottenpass 8y ago
Controlling the secondary market is an attempt to continue providing the first sale below market price. It wouldn't be hard to experiment with sales models and price curves to simultaneously increase profits and suffocate the secondary market.
- KozmoNau7 8y ago
  You have to factor in the artist/fan relationship as well. By increasing the price, you very quickly alienate large portions of your fanbase. I've seen some artists sell tickets at $200+, and the fan backlash was noticeable. But perfect if you only want to attract rich boomers, I guess.
cmurf 8y ago
Paying $500 for a ticket is conspicuous consumption, and I have no problem at all with Ticketmaster, or anybody else, gouging people as much money as they possibly can. The problem I have, is that most of these facilities are publicly owned, while the team is a for-profit adventure, and thus heavily subsidized under the fake notion that it's good for the community, when in fact the community is being screwed over. If this were really anything approaching free market, there'd be none of that. But the massive public subsidy is why there's downward pressure on ticket prices and why you see scalping. I suggest looking for junior clubs, college games, or one of many pro sports leagues you've never heard of (lacrosse, rugby, arena football). I pay $35/game for 4th row from the glass seats at one of the best college hockey teams in the country, and it's way more interesting than NHL hockey where that same ticket would cost $250.
- baddox 8y ago
  I'm not sure how the dollar amount makes Ticketmaster's actions more acceptable, and I don't think you're using "conspicuous consumption" correctly.
  - SilasX 8y ago
    Right, it's not conspicuous consumption to pay more vs less for the ticket, since almost no one observes the purchase. Now, attending the event is conspicuous consumption, but the specific amount you paid is irrelevant to that, except to the extent that people in general know you have to pay a lot for the tickets.
wnevets 8y ago
I feel like the New York Comic Con has a done a good job preventing scalpers from ruining the experience for its customers with Fan Verification. Since it was implemented I haven't had to worry about tickets being sold out in minutes. http://www.newyorkcomiccon.com/Attend/Badges/Fan-Verification-FAQs/ http://www.newyorkcomiccon.com/Attend/Badges/Fan-Verificatio...
- HaloZero 8y ago
  It's not clear from the FAQ but what else goes into Fan Verficiation that creating an account on TicketMaster can't accomplish?
  - Jach 8y ago
    Presumably the ticket is tied to the purchaser's id in some way (picture, name, or payment info) and at the event ticket holders need to present such information. It'd be a trade-off against people who can't make it to the event being out of luck (no way to resell), but stopping more of the scalper's bad behavior. You could alleviate the trade-off by tying the ticket to a second factor like a CC that you could entrust to a friend for the event, or allowing more refunds before a certain date.
    - kevin_thibedeau 8y ago
      Nope. For Springsteen on Broadway you just signed up in advance and hoped to win their lottery. No actual verification of anything.
- ageitgey 8y ago
  That's an interesting approach. San Diego Comic Con takes the approach of making you jump through so many hoops that only obsessives can make it through the processes. To buy a ticket, you have to create an account to buy a ticket before the ticket sale date is announced. Once the date is announced, you are no longer allowed to create a new account for that year's sales. Then you get assigned an hour-long time slot in the far future during which you have to be actively present online to enter a lottery to see if you have the chance to even buy a ticket. Then you have to buy the kind of ticket you want before that batch sells out. And if you went the previous year, there's a whole different set of rules to figure out of how to maintain your eligibility to buy a ticket the next year with it's own different set of dates and forms to fill out. All of this is incredibly hard to figure out if you don't spend your life trying to figure out how to buy Comic Con tickets. There are multiple dates you have to plan around and you have to show up during your 1-hour purchase window even if it's in the middle of the night for your location. So while it prevents most scalping effectively, I personally think it's a crappy experience and a crappy solution.
Albi224 8y ago
GET protocol - check them out. They are live with over 50k tickets sold this year and with a blockchain backbone. This is not a shill. Its just an interesting company with a solution to ticket scalping, please consider if it is interesting to you
KozmoNau7 8y ago
You would end up massively favoring the wealthy fans, who have a lot of disposable income, leaving less fortunate fans with basically no chance to get tickets. The solution is to either make tickets non-transferable or make it illegal to sell tickets above face value. Not everything needs to hit a perfect profit ratio.
- medell 8y ago
  Exactly, it's not always about maximizing profit. Artists also to play for their fans. This is one of the main reasons artists have fan club email lists, to let actual fans get first go at tickets before the public sale date. Of course, there's nothing stopping scalpers from signing up.
briffle 8y ago
I stopped using ticketmaster years ago, but it seems like a reverse auction would be the best way. Start each ticket at $500. Every X minutes, knock the price down by Y percent.
- dbbk 8y ago
  So only rich people should be allowed to see major artists in concert?
  - Spivak 8y ago
    I mean artists are free to reserve discounted tickets for fans and sell them fcfs but they would be intentionally losing money by doing so. Sometimes this is a good choice because you don't want to make your fans mad. It's just a system where people are incented to pay the most they're willing to. Pay before your price and you lose money, pay after your price and you risk the show being sold out.
    - onion2k 8y ago
      Except it wouldn't be intentionally losing money. Long term fans are what make a band the most money - they buy tickets and merch, and albums (games, movies, etc). By cashing in on big gigs and maximizing the sales for those tickets an artist would potentially be giving up a lot more long tail revenue, and possibly killing their fan base altogether. Maximizing long term profitability is often not the same as maximizing short term revenue.
      - saosebastiao 8y ago
        There's an easy way to charge market prices and have them be lower. You can raise supply by playing more shows. And if a band values its long term fans, they should have an interest in getting as many people into their shows as possible. Just stay an extra night or two and play another show.
  - thecatspaw 8y ago
kareemsabri 8y ago
> But given the ridiculous levels of scalping that goes on every day (including all the companies that attempt to normalize it, like StubHub), doesn't it all imply that the fair market price of a lot of tickets is way higher than what they sell for? Obviously demand is way outstripping supply or people wouldn't pay $500-$1000 for $100 tickets on a daily basis. Scalpers are the ones choking off supply by monopolizing huge numbers of tickets. A market with too few sellers gives those sellers price control. If Ticketmaster put a stop to the practice, prices would likely drop.
- stochastic_monk 8y ago
  Exactly. That’s extortion, not a free market.
- kbenson 8y ago
  > A market with too few sellers gives those sellers price control. There isn't a set amount of supply. Artists could (and do) easily add dates, increasing supply. Many events are bought by brokers and then end up selling below cost because a date was added, and there's just not enough demand to be able to charge premiums on the face value (which is almost never the purchase cost, because of additional fees during checkout). People usually overestimate how much the brokers affect the ability to get tickets, and how many events that happens on. There are many things that contribute to low supply and high demand, but brokers are convenient villains to point to. Artists have full control over this, and they can often easily solve the problem by playing larger venues or multiple dates, but they don't because that might cut into profits if the venue doesn't sell out.
- Benjammer 8y ago
  >Scalpers are the ones choking off supply by monopolizing huge numbers of tickets The only way this would actually have any effect on "supply" is if scalpers were just eating tickets and leaving empty seats in the venue. The number of seats at the venue is more the "supply" than the number of tickets outstanding on the sales markets. If a scalper was able to buy 100% of the tickets for an event, and then sell all of them at 3x "face value", then that means that the market was able to bear a price of 3x. The scalper did not change "supply" here...
nicoburns 8y ago
You're making quite an assumption with your use of the phrase "fair market price". In this case the market price isn't fair. It's pretty eady to solve this. Require ID for ticket purchases, and prevent resale except through authorised channels at face value.
travisoneill1 8y ago
Promoters are well aware that they sell tickets for less than they could get but I think it's unlikely to change. There are essentially 2 ways to distribute things. A free market model where the highest bidder gets to buy. Or a price control model where only some people get to buy based on some arbitrary selection model, usually first come first serve. And everybody else is SOL. When people think (emotionally) of what is "fair" they typically think of the price control model, which is why we have rent control, price gouging laws, and people get pissed off at Uber surge pricing. So if promoters try a more market based strategy like the one you mention it will probably cause a backlash from fans for charging $500 for a ticket. Unlike the promoters, scalpers have no perceived connection to the artists, so they (or Ticketmaster) can take the public outrage in exchange for profits without risking future ticket sales.
- derefr 8y ago
  > So if promoters try a more market based strategy like the one you mention it will probably cause a backlash from fans for charging $500 for a ticket. Unlike the promoters, scalpers have no perceived connection to the artists, so they (or Ticketmaster) can take the public outrage in exchange for profits without risking future ticket sales. Yeah, which is why the promoter should just present itself as a scalper, "selling out" 100% of its tickets to a subsidiary, which then does a reverse auction like in the GP's comment. Fans won't care, because nothing has really changed from their perspective; the promoter will make more money (that the artist can demand be passed on to them); actual scalpers, economic parasites that they are, will make less money; the market will clear more efficiently; economists will be satisfied. Everyone wins. Everyone except for—as can be seen in the OP article—non-economically-versed journalists, and those that they manage to incense with their rhetoric.
  - kbenson 8y ago
    > actual scalpers, economic parasites that they are Scalpers/brokers aren't economic parasites, they provide a function to artists and promoters by offloading risk, and they also provide liquidity to fans. If if it comes down to selling out 50% of a venue immediately and the other 50% over the next 2-3 months, or selling out 100% of a venue in one day, I imagine most promoters and artists would like that money now so they can utilize it. Brokers trade use of money over time for risk. Sometimes they make money, sometimes they lose money because it's overbought, they misjudged the market, or more supply was provided (a date added at that location). For example, see here[1], where resale tickets are under the cost of primary market tickets, $36.50 instead of $39.50, and that's before Ticketmaster/Stubhub takes 5-10% of the sale price from the seller. On Stubhub[2], the same tickets are going for $27. 1: https://concerts1.livenation.com/event/000054C6CF1B8160 https://concerts1.livenation.com/event/000054C6CF1B8160 2: https://www.stubhub.com/the-damned-tickets-the-damned-new-york-irving-plaza-10-18-2018/event/103709847/ https://www.stubhub.com/the-damned-tickets-the-damned-new-yo...
bashinator 8y ago
Iron Maiden require that the credit card and matching ID used for the original ticket purchase be presented, in order to enter the show venue. There's no scalping of Iron Maiden tickets.
- CraneWorm 8y ago
  This also means that you can't buy the tickets as a gift, nor can you pass the ticket if you can't go.
  - gruez 8y ago
    >This also means that you can't buy the tickets as a gift how so? you just specify the gift recipient's name at the time of purchase. >nor can you pass the ticket if you can't go. don't speculatively buy tickets then? nobody seems to mind that you can't (cheaply) cancel airplane tickets.
    - jen729w 8y ago
      And the companies that do it like this almost always have a “sell it back to us if you can’t go, and we’ll sell it back on” policy. It’s hard to lose if you’re an honest fan.
  - alsetmusic 8y ago
    The above was downvoted, but I thought of the same issue (tickets as a gift) immediately. Before I was 18, my father let me use his credit card to orders tickets for all the shows I went to. Imagine if he had to come to the venue with his credentials to get me in every time. I also have donated my tickets to friends when a show that was scheduled three months out becomes unappealing due to illness or other unpredictable factors.
- Benjammer 8y ago
  Scalpers solved this _immediately_ by buying Visa prepaid cards, put only the total purchase price amount on the card, buy the tickets with the card, then mail that physical card to the secondary ticket buyer... Edit: Sorry, didn't see at first glance that you mentioned ID as well. Maybe that does close this loophole?
stuart78 8y ago
Planet Money did a story[0] on this a few years ago, which helps articulate why artists see value in the traditional way of selling tickets. [0] https://www.npr.org/sections/money/2013/06/25/195641030/episode-468-kid-rock-vs-the-scalpers https://www.npr.org/sections/money/2013/06/25/195641030/epis...
bonestamp2 8y ago
> Obviously demand is way outstripping supply You're right that people are willing to pay more than the current face value, but we shouldn't take the scalper prices as the fair market value either because the true demand is dramatically skewed by a group whose only goal is to raise the price to the highest number people will pay, and they do that by reducing the supply. They can buy hundreds of tickets and only list a few at a time. I've paid $500/ticket before, so I'm part of the problem too... but sometimes we do unreasonable things when we're unreasonably big fans of a particular band, comedian, performer, etc. There's no easy solution, but it would be cool if there was a way to offer reasonably priced tickets to true fans.
- Benjammer 8y ago
  >They can buy hundreds of tickets and only list a few at a time. I don't think ticket brokers really ever do this... It wouldn't _always_ increase their profits, and would substantially increase their risk (of not selling all inventory). Not all events increase in secondary market price as the event date approaches, you just hear about when it happens for really popular events. The price is set by the demand of the fans, and with the supply of the number of shows the performer is willing to put on. >reasonably priced tickets to true fans Yeah, I mean, this kind of idea sounds nice in theory, but it doesn't really match up to the way capitalism works in the real world in this industry. Say you started with an environment where every event was priced "reasonably" and every seller/promoter used the same scale to evaluate "true fans" and decided equally who were "true fans". Any single company could increase their own profits over competitors by marginally reducing the acceptance bar of "true fans" they sell to, and then increasing the price point to match the increased demand they've just created (remember, supply is fixed unless the performer adds more shows). This is a unilateral action by that company, they don't need to gain the cooperation of any other entity in the marketplace, and it increases profits. This means that the system is _not_ in a Nash equilibrium, and, without accounting for regulations or any other outside forces, the industry will naturally shift over time towards an equilibrium where no single company could financially benefit from reducing restrictions on buyers and increasing the price point. At this point they probably lose _more_ in the hit to their reputation than they _make up_ in the increased profits. So they shift towards "gouging fans" just enough to increase profits without being bad enough to reduce demand for their product and shift market price point below costs (unprofitable).
chongli 8y ago
Ticketmaster provides a valuable service for the associated acts: Reputation shield If artists started charging fair market prices for their tickets the fans would go ballistic and the artists' reputations would be severely damaged. By ostensibly selling the tickets below, even if normal people never get to buy them at face value, they outsource the reputation damage to Ticketmaster. Since Ticketmaster already has a detestable reputation, they are well-equipped to provide this service with minimal damage to their brand. In exchange, Ticketmaster pays a portion of their revenues to the promoters and their associated acts. It's a win win: artists get more money without damaging their credibility with their fans.
- TylerE 8y ago
  These is seemingly getting less common. Not at all uncommon to see $1000+ VIP packages for major tours these days
  - josh2600 8y ago
    Perhaps strange to most of us, $1000+ is not near the full price a VIP package might bear in the current market.
    - Benjammer 8y ago
      If you are seeing primary market prices of $1k for a VIP package, you can be assured these same packages are going for $3-4k direct to brokers, and $5k+ on secondary markets to buyers.
    - lallysingh 8y ago
      I saw a $35k (for two) VIP package last year. Bonkers.
  - kbenson 8y ago
    Those are separate things. The VIP/Premium tickets are a way to do dynamic pricing without looking like you're proving too many price levels. The extra fees are a way to show lower prices and let the fallout for the end price fall on another group. I outlined a lot of this with real data in another comment here. Just search for "mccartney" in the comments here.
Timmah 8y ago
I think the ticket should be matched to a government ID or passport. Drivers licenses have barcodes on them. Sell cheap tickets that rewire ID and sell "unlocked" tickets for 2x as much.
hinkley 8y ago
Blizzard Entertainment has a conference every year and the height of their popularity demand for tickets far outstripped the capacity of any venue they could reasonably get. I recall in the first years hearing of friends or acquaintances who sat up in a group and spammed the server right after tickets were posted. In later years I heard they went with a lottery system. You had a window to sign up that gave their servers a break and at the end you either got a ticket or you didn't. Where a convention differs from a concert is that you can show up at a convention without a ticket and still participate in some fashion. You can hang out at off-site events that are affiliated, and it's common (if not entirely legal) for people to timeshare a pass, going for a few hours and then letting a friend or coworker go for the rest of the day. The scalpers could still of course flood a lottery system, but if you make sure that only 4 tickets go to the same human (via ID or some other means) then the scalpers are limited to how many people they can get to agree to pretend to be the purchaser, and they open themselves up to identity fraud and/or theft charges if they get caught faking it.
hardtke 8y ago
There is an economics research paper that shows that ticket auctions on Ticketmaster can reduce the arbitrage profits of scalpers (https://faculty.chicagobooth.edu/eric.budish/research/Ticket-Auctions.pdf https://faculty.chicagobooth.edu/eric.budish/research/Ticket...) They compared the primary auction price to the ebay resale price and found they were about the same. It's unclear why ticket auctions never took off, although it may be that the only work well for shows with high demand.
ghobs91 8y ago
I mean couldn't you just solve all this by tying a ticket purchase to a name, and make them non-transferable? Can't sell a ticket if the buyer will have to provide your ID.
mseidl 8y ago
In Germany there's a law saying you cannot sell a ticket for more than the price listed on the ticket.
- taejo 8y ago
  Are you sure? The first result I found on Google was https://www.lhr-law.de/magazin/sportrecht/schwarzmarkt-rechtliche-konsequenzen-beim-weiterverkauf-von-eintrittskarten https://www.lhr-law.de/magazin/sportrecht/schwarzmarkt-recht... 8. Darf ich die Karte teurer als zum Normalpreis verkaufen? Ja, der Weiterverkauf von Karten zu einem erhöhten Preis ist nicht verboten. Eine Grenze stellt diesbezüglich lediglich der sogenannte Wucher nach § 138 Abs. 2 BGB dar, bei welchem sich jemand unter Ausnutzung einer Zwangslage eine Gegenleistung sichern lässt, die in einem auffälligen Missverhältnis zur eigenen Leistung steht. Nun könnte man annehmen, dass bei einem Weiterverkauf einer Eintrittskarte ein zehnfach überhöhter Preis nach gesundem Menschenverstand in einem auffälligen Missverhältnis zum tatsächlichen Fussballspiel oder zum tatsächlichen Konzert von Helene Fischer, den Rolling Stones oder anderen Künstlern steht und damit unzulässig ist. Dies ist aber gerade nicht der Fall, weil keine Zwangslage vorliegt, die ausgenutzt werden könnte (vgl. OLG Köln, OLGE 93, 193, 194f., wonach der um das Zehnfache erhöhte Preis für eine Eintrittskarte für ein Fussball-WM-Endspiel mangels Ausnutzung einer Zwangslage keinen unzulässigen Wucher darstellte). Im Ergebnis kann jeder frei entscheiden, wieviel ihm der Zutritt zu einer bestimmten Veranstaltung wert ist. but if you can cite something else I'd be interested.
fouc 8y ago
Ticket auctions seems like a reasonable way to be fair , and ticket master supports that http://www.ticketmaster.com/ticketauctions http://www.ticketmaster.com/ticketauctions I guess it depends on the artist for whether the auction is allowed or not?
totalZero 8y ago
Or alternatively, release tickets on a randomized basis leading up to the event, coinciding in probability with the frequency of event advertisement.

josh2600 8y ago

It's subtly more complicated than this. There's the price people are willing to pay before something is "sold out" and exclusive, and the price people are willing to pay to get access to an experience they can't otherwise get. It's the fact that someone can press a button and get summoned to a show that they wouldn't otherwise have access to that provides some kind of dopamine rush that isn't the same as waiting in line on a website madly refreshing a page hoping for a ticket.

SilasX 8y ago
Lesson: If you base your buying decision on whether it's sold out, expect the market to exploit you.
ageitgey 8y ago
I agree that is one factor at work, but performers have caught onto this in the last couple of years and have started to offer a lot of exclusive VIP packages to try to capture this price-insensitive market. I'm thinking more about mass scalping for events like Hamilton where every single ticket is bought up instantly by bots for the next four months. There is essentially no way to reliably buy the tickets at normal prices. I tried to buy tickets for Hamilton's touring show and there were hundreds of resell tickets listed on StubHub while I was still trying to get through the process of even seeing if I could find tickets myself. It was completely absurd. A significant percentage of the total available seating must have been scalped. I've done a little work in this space tangentially in the past. The resale market is highly developed with a lot of money at stake and inventory is readily available at every price level and ticket type. Have you ever noticed how every resale site has more or less the same tickets for sale? There are a few middlemen companies that provide the ticket inventory for any reseller to sell instantaneously via API feeds. Stubhub is in both businesses - selling to customers and acting as a middleman to other sellers. It's way more developed than most people think.
- kbenson 8y ago
  > performers have caught onto this in the last couple of years and have started to offer a lot of exclusive VIP packages to try to capture this price-insensitive market. Artists/promoters have also started using dynamic pricing. Ticket prices might raise or lower after some presales depending on demand. Wednesday the cheapest ticket to the venue might be $49, while on Friday they've raised the price on existing unsold inventory to $69. > I'm thinking more about mass scalping for events like Hamilton where every single ticket is bought up instantly by bots for the next four months. It sucks that the situation is happening, but it's also very easy to fix. Either increase supply, or do something to reduce demand (like raise the price). > I tried to buy tickets for Hamilton's touring show and there were hundreds of resell tickets listed on StubHub while I was still trying to get through the process of even seeing if I could find tickets myself. Some of the is spec listings, where they don't have inventory yet but plan to get some, some of that is brokers/people listing items they've reserved but haven't finalized the process of buying, and some may very well be brokers, or even the venue or promoters themselves listing on Stubhub. If you're an artist, venue of promoter and you want to make more money but don't want to look likeyou're gouging your customers, and you have access to inventory you're allowed to sell yourself, what would you do? That's what they're doing. > I've done a little work in this space tangentially in the past. The resale market is highly developed with a lot of money at stake and inventory is readily available at every price level and ticket type. I've done, and am doing, work in this market. It's like any other, except that the ratio of good actors to those acting a bit excessively is a bit skewed for historical reasons. > There are a few middlemen companies that provide the ticket inventory for any reseller to sell instantaneously via API feeds. It's not that they sell instantaneously via API feeds, they just help push inventory to multiple exchanges, and help sell out the inventory in the point of sale when it sells on an exchange and remove it from the other ones. I'm sure there's software that does something similar for Amazon and Ebay too. I've written about this before here[1], and there's some more detail in that. Specifically, I think the secondary market performs a useful function, as much as it's vilified, as explained in that link. 1: https://news.ycombinator.com/item?id=16379207 https://news.ycombinator.com/item?id=16379207

chimeracoder 8y ago

> This is super sleezy and I think Ticketmaster is one of the most awful companies in the world. But given the ridiculous levels of scalping that goes on every day (including all the companies that attempt to normalize it, like StubHub), doesn't it all imply that the fair market price of a lot of tickets is way higher than what they sell for? Obviously demand is way outstripping supply or people wouldn't pay $500-$1000 for $100 tickets on a daily basis. Yes, and this is the entire reason Ticketmaster exists. Artists and venues don't want to look like they're gouging their fans, so they post lower prices (with hidden fees). These then get resold on the secondary market.

amyjess 8y ago

Another option would be to make tickets nontransferrable and make venues require photo ID before accepting anyone's tickets.

marban 8y ago
Which would translate to queues that make airport security feel like a breeze.
- Barrin92 8y ago
  let's use face recognition for it, maybe we can put it to use for something that isn't policing
  - ageitgey 8y ago
    Maybe you are joking, but there are several companies trying this, like https://zenus-biometrics.com/ https://zenus-biometrics.com/
    - Barrin92 8y ago
      I wasn't joking at all. Tokyo is gearing up to use face recognition to process people at the 2020 Olympics as well. https://www.theverge.com/2018/8/7/17659746/tokyo-2020-olympic-games-face-recognition-nec https://www.theverge.com/2018/8/7/17659746/tokyo-2020-olympi... Also you made a python face recognition library right? I like it a lot, so thanks for making it!
MrMember 8y ago
I've been to a few shows that have done something like this. The credit card I used to buy the ticket was used as my "ticket" to get in to the show.
- oh_sigh 8y ago
  Scalpers can just buy tickets with prepaid credit cards and send those to the buyers

forgottenpass 8y ago

Controlling the secondary market is an attempt to continue providing the first sale below market price. It wouldn't be hard to experiment with sales models and price curves to simultaneously increase profits and suffocate the secondary market.

KozmoNau7 8y ago
You have to factor in the artist/fan relationship as well. By increasing the price, you very quickly alienate large portions of your fanbase. I've seen some artists sell tickets at $200+, and the fan backlash was noticeable. But perfect if you only want to attract rich boomers, I guess.

cmurf 8y ago

Paying $500 for a ticket is conspicuous consumption, and I have no problem at all with Ticketmaster, or anybody else, gouging people as much money as they possibly can. The problem I have, is that most of these facilities are publicly owned, while the team is a for-profit adventure, and thus heavily subsidized under the fake notion that it's good for the community, when in fact the community is being screwed over. If this were really anything approaching free market, there'd be none of that. But the massive public subsidy is why there's downward pressure on ticket prices and why you see scalping. I suggest looking for junior clubs, college games, or one of many pro sports leagues you've never heard of (lacrosse, rugby, arena football). I pay $35/game for 4th row from the glass seats at one of the best college hockey teams in the country, and it's way more interesting than NHL hockey where that same ticket would cost $250.

baddox 8y ago
I'm not sure how the dollar amount makes Ticketmaster's actions more acceptable, and I don't think you're using "conspicuous consumption" correctly.
- SilasX 8y ago
  Right, it's not conspicuous consumption to pay more vs less for the ticket, since almost no one observes the purchase. Now, attending the event is conspicuous consumption, but the specific amount you paid is irrelevant to that, except to the extent that people in general know you have to pay a lot for the tickets.

wnevets 8y ago

I feel like the New York Comic Con has a done a good job preventing scalpers from ruining the experience for its customers with Fan Verification. Since it was implemented I haven't had to worry about tickets being sold out in minutes. http://www.newyorkcomiccon.com/Attend/Badges/Fan-Verification-FAQs/ http://www.newyorkcomiccon.com/Attend/Badges/Fan-Verificatio...

HaloZero 8y ago
It's not clear from the FAQ but what else goes into Fan Verficiation that creating an account on TicketMaster can't accomplish?
- Jach 8y ago
  Presumably the ticket is tied to the purchaser's id in some way (picture, name, or payment info) and at the event ticket holders need to present such information. It'd be a trade-off against people who can't make it to the event being out of luck (no way to resell), but stopping more of the scalper's bad behavior. You could alleviate the trade-off by tying the ticket to a second factor like a CC that you could entrust to a friend for the event, or allowing more refunds before a certain date.
  - kevin_thibedeau 8y ago
    Nope. For Springsteen on Broadway you just signed up in advance and hoped to win their lottery. No actual verification of anything.
ageitgey 8y ago
That's an interesting approach. San Diego Comic Con takes the approach of making you jump through so many hoops that only obsessives can make it through the processes. To buy a ticket, you have to create an account to buy a ticket before the ticket sale date is announced. Once the date is announced, you are no longer allowed to create a new account for that year's sales. Then you get assigned an hour-long time slot in the far future during which you have to be actively present online to enter a lottery to see if you have the chance to even buy a ticket. Then you have to buy the kind of ticket you want before that batch sells out. And if you went the previous year, there's a whole different set of rules to figure out of how to maintain your eligibility to buy a ticket the next year with it's own different set of dates and forms to fill out. All of this is incredibly hard to figure out if you don't spend your life trying to figure out how to buy Comic Con tickets. There are multiple dates you have to plan around and you have to show up during your 1-hour purchase window even if it's in the middle of the night for your location. So while it prevents most scalping effectively, I personally think it's a crappy experience and a crappy solution.

Albi224 8y ago

GET protocol - check them out. They are live with over 50k tickets sold this year and with a blockchain backbone. This is not a shill. Its just an interesting company with a solution to ticket scalping, please consider if it is interesting to you

KozmoNau7 8y ago

You would end up massively favoring the wealthy fans, who have a lot of disposable income, leaving less fortunate fans with basically no chance to get tickets. The solution is to either make tickets non-transferable or make it illegal to sell tickets above face value. Not everything needs to hit a perfect profit ratio.

medell 8y ago
Exactly, it's not always about maximizing profit. Artists also to play for their fans. This is one of the main reasons artists have fan club email lists, to let actual fans get first go at tickets before the public sale date. Of course, there's nothing stopping scalpers from signing up.

briffle 8y ago

I stopped using ticketmaster years ago, but it seems like a reverse auction would be the best way. Start each ticket at $500. Every X minutes, knock the price down by Y percent.

dbbk 8y ago
So only rich people should be allowed to see major artists in concert?
- Spivak 8y ago
  I mean artists are free to reserve discounted tickets for fans and sell them fcfs but they would be intentionally losing money by doing so. Sometimes this is a good choice because you don't want to make your fans mad. It's just a system where people are incented to pay the most they're willing to. Pay before your price and you lose money, pay after your price and you risk the show being sold out.
  - onion2k 8y ago
    Except it wouldn't be intentionally losing money. Long term fans are what make a band the most money - they buy tickets and merch, and albums (games, movies, etc). By cashing in on big gigs and maximizing the sales for those tickets an artist would potentially be giving up a lot more long tail revenue, and possibly killing their fan base altogether. Maximizing long term profitability is often not the same as maximizing short term revenue.
    - saosebastiao 8y ago
      There's an easy way to charge market prices and have them be lower. You can raise supply by playing more shows. And if a band values its long term fans, they should have an interest in getting as many people into their shows as possible. Just stay an extra night or two and play another show.
- thecatspaw 8y ago

kareemsabri 8y ago

> But given the ridiculous levels of scalping that goes on every day (including all the companies that attempt to normalize it, like StubHub), doesn't it all imply that the fair market price of a lot of tickets is way higher than what they sell for? Obviously demand is way outstripping supply or people wouldn't pay $500-$1000 for $100 tickets on a daily basis. Scalpers are the ones choking off supply by monopolizing huge numbers of tickets. A market with too few sellers gives those sellers price control. If Ticketmaster put a stop to the practice, prices would likely drop.

stochastic_monk 8y ago
Exactly. That’s extortion, not a free market.
kbenson 8y ago
> A market with too few sellers gives those sellers price control. There isn't a set amount of supply. Artists could (and do) easily add dates, increasing supply. Many events are bought by brokers and then end up selling below cost because a date was added, and there's just not enough demand to be able to charge premiums on the face value (which is almost never the purchase cost, because of additional fees during checkout). People usually overestimate how much the brokers affect the ability to get tickets, and how many events that happens on. There are many things that contribute to low supply and high demand, but brokers are convenient villains to point to. Artists have full control over this, and they can often easily solve the problem by playing larger venues or multiple dates, but they don't because that might cut into profits if the venue doesn't sell out.
Benjammer 8y ago
>Scalpers are the ones choking off supply by monopolizing huge numbers of tickets The only way this would actually have any effect on "supply" is if scalpers were just eating tickets and leaving empty seats in the venue. The number of seats at the venue is more the "supply" than the number of tickets outstanding on the sales markets. If a scalper was able to buy 100% of the tickets for an event, and then sell all of them at 3x "face value", then that means that the market was able to bear a price of 3x. The scalper did not change "supply" here...

nicoburns 8y ago

You're making quite an assumption with your use of the phrase "fair market price". In this case the market price isn't fair. It's pretty eady to solve this. Require ID for ticket purchases, and prevent resale except through authorised channels at face value.

travisoneill1 8y ago

Promoters are well aware that they sell tickets for less than they could get but I think it's unlikely to change. There are essentially 2 ways to distribute things. A free market model where the highest bidder gets to buy. Or a price control model where only some people get to buy based on some arbitrary selection model, usually first come first serve. And everybody else is SOL. When people think (emotionally) of what is "fair" they typically think of the price control model, which is why we have rent control, price gouging laws, and people get pissed off at Uber surge pricing. So if promoters try a more market based strategy like the one you mention it will probably cause a backlash from fans for charging $500 for a ticket. Unlike the promoters, scalpers have no perceived connection to the artists, so they (or Ticketmaster) can take the public outrage in exchange for profits without risking future ticket sales.

derefr 8y ago
> So if promoters try a more market based strategy like the one you mention it will probably cause a backlash from fans for charging $500 for a ticket. Unlike the promoters, scalpers have no perceived connection to the artists, so they (or Ticketmaster) can take the public outrage in exchange for profits without risking future ticket sales. Yeah, which is why the promoter should just present itself as a scalper, "selling out" 100% of its tickets to a subsidiary, which then does a reverse auction like in the GP's comment. Fans won't care, because nothing has really changed from their perspective; the promoter will make more money (that the artist can demand be passed on to them); actual scalpers, economic parasites that they are, will make less money; the market will clear more efficiently; economists will be satisfied. Everyone wins. Everyone except for—as can be seen in the OP article—non-economically-versed journalists, and those that they manage to incense with their rhetoric.
- kbenson 8y ago
  > actual scalpers, economic parasites that they are Scalpers/brokers aren't economic parasites, they provide a function to artists and promoters by offloading risk, and they also provide liquidity to fans. If if it comes down to selling out 50% of a venue immediately and the other 50% over the next 2-3 months, or selling out 100% of a venue in one day, I imagine most promoters and artists would like that money now so they can utilize it. Brokers trade use of money over time for risk. Sometimes they make money, sometimes they lose money because it's overbought, they misjudged the market, or more supply was provided (a date added at that location). For example, see here[1], where resale tickets are under the cost of primary market tickets, $36.50 instead of $39.50, and that's before Ticketmaster/Stubhub takes 5-10% of the sale price from the seller. On Stubhub[2], the same tickets are going for $27. 1: https://concerts1.livenation.com/event/000054C6CF1B8160 https://concerts1.livenation.com/event/000054C6CF1B8160 2: https://www.stubhub.com/the-damned-tickets-the-damned-new-york-irving-plaza-10-18-2018/event/103709847/ https://www.stubhub.com/the-damned-tickets-the-damned-new-yo...

bashinator 8y ago

Iron Maiden require that the credit card and matching ID used for the original ticket purchase be presented, in order to enter the show venue. There's no scalping of Iron Maiden tickets.

CraneWorm 8y ago
This also means that you can't buy the tickets as a gift, nor can you pass the ticket if you can't go.
- gruez 8y ago
  >This also means that you can't buy the tickets as a gift how so? you just specify the gift recipient's name at the time of purchase. >nor can you pass the ticket if you can't go. don't speculatively buy tickets then? nobody seems to mind that you can't (cheaply) cancel airplane tickets.
  - jen729w 8y ago
    And the companies that do it like this almost always have a “sell it back to us if you can’t go, and we’ll sell it back on” policy. It’s hard to lose if you’re an honest fan.
- alsetmusic 8y ago
  The above was downvoted, but I thought of the same issue (tickets as a gift) immediately. Before I was 18, my father let me use his credit card to orders tickets for all the shows I went to. Imagine if he had to come to the venue with his credentials to get me in every time. I also have donated my tickets to friends when a show that was scheduled three months out becomes unappealing due to illness or other unpredictable factors.
Benjammer 8y ago
Scalpers solved this _immediately_ by buying Visa prepaid cards, put only the total purchase price amount on the card, buy the tickets with the card, then mail that physical card to the secondary ticket buyer... Edit: Sorry, didn't see at first glance that you mentioned ID as well. Maybe that does close this loophole?

stuart78 8y ago

Planet Money did a story[0] on this a few years ago, which helps articulate why artists see value in the traditional way of selling tickets. [0] https://www.npr.org/sections/money/2013/06/25/195641030/episode-468-kid-rock-vs-the-scalpers https://www.npr.org/sections/money/2013/06/25/195641030/epis...

bonestamp2 8y ago

> Obviously demand is way outstripping supply You're right that people are willing to pay more than the current face value, but we shouldn't take the scalper prices as the fair market value either because the true demand is dramatically skewed by a group whose only goal is to raise the price to the highest number people will pay, and they do that by reducing the supply. They can buy hundreds of tickets and only list a few at a time. I've paid $500/ticket before, so I'm part of the problem too... but sometimes we do unreasonable things when we're unreasonably big fans of a particular band, comedian, performer, etc. There's no easy solution, but it would be cool if there was a way to offer reasonably priced tickets to true fans.

Benjammer 8y ago
>They can buy hundreds of tickets and only list a few at a time. I don't think ticket brokers really ever do this... It wouldn't _always_ increase their profits, and would substantially increase their risk (of not selling all inventory). Not all events increase in secondary market price as the event date approaches, you just hear about when it happens for really popular events. The price is set by the demand of the fans, and with the supply of the number of shows the performer is willing to put on. >reasonably priced tickets to true fans Yeah, I mean, this kind of idea sounds nice in theory, but it doesn't really match up to the way capitalism works in the real world in this industry. Say you started with an environment where every event was priced "reasonably" and every seller/promoter used the same scale to evaluate "true fans" and decided equally who were "true fans". Any single company could increase their own profits over competitors by marginally reducing the acceptance bar of "true fans" they sell to, and then increasing the price point to match the increased demand they've just created (remember, supply is fixed unless the performer adds more shows). This is a unilateral action by that company, they don't need to gain the cooperation of any other entity in the marketplace, and it increases profits. This means that the system is _not_ in a Nash equilibrium, and, without accounting for regulations or any other outside forces, the industry will naturally shift over time towards an equilibrium where no single company could financially benefit from reducing restrictions on buyers and increasing the price point. At this point they probably lose _more_ in the hit to their reputation than they _make up_ in the increased profits. So they shift towards "gouging fans" just enough to increase profits without being bad enough to reduce demand for their product and shift market price point below costs (unprofitable).

chongli 8y ago

Ticketmaster provides a valuable service for the associated acts: Reputation shield If artists started charging fair market prices for their tickets the fans would go ballistic and the artists' reputations would be severely damaged. By ostensibly selling the tickets below, even if normal people never get to buy them at face value, they outsource the reputation damage to Ticketmaster. Since Ticketmaster already has a detestable reputation, they are well-equipped to provide this service with minimal damage to their brand. In exchange, Ticketmaster pays a portion of their revenues to the promoters and their associated acts. It's a win win: artists get more money without damaging their credibility with their fans.

TylerE 8y ago
These is seemingly getting less common. Not at all uncommon to see $1000+ VIP packages for major tours these days
- josh2600 8y ago
  Perhaps strange to most of us, $1000+ is not near the full price a VIP package might bear in the current market.
  - Benjammer 8y ago
    If you are seeing primary market prices of $1k for a VIP package, you can be assured these same packages are going for $3-4k direct to brokers, and $5k+ on secondary markets to buyers.
  - lallysingh 8y ago
    I saw a $35k (for two) VIP package last year. Bonkers.
- kbenson 8y ago
  Those are separate things. The VIP/Premium tickets are a way to do dynamic pricing without looking like you're proving too many price levels. The extra fees are a way to show lower prices and let the fallout for the end price fall on another group. I outlined a lot of this with real data in another comment here. Just search for "mccartney" in the comments here.

Timmah 8y ago

I think the ticket should be matched to a government ID or passport. Drivers licenses have barcodes on them. Sell cheap tickets that rewire ID and sell "unlocked" tickets for 2x as much.

hinkley 8y ago

Blizzard Entertainment has a conference every year and the height of their popularity demand for tickets far outstripped the capacity of any venue they could reasonably get. I recall in the first years hearing of friends or acquaintances who sat up in a group and spammed the server right after tickets were posted. In later years I heard they went with a lottery system. You had a window to sign up that gave their servers a break and at the end you either got a ticket or you didn't. Where a convention differs from a concert is that you can show up at a convention without a ticket and still participate in some fashion. You can hang out at off-site events that are affiliated, and it's common (if not entirely legal) for people to timeshare a pass, going for a few hours and then letting a friend or coworker go for the rest of the day. The scalpers could still of course flood a lottery system, but if you make sure that only 4 tickets go to the same human (via ID or some other means) then the scalpers are limited to how many people they can get to agree to pretend to be the purchaser, and they open themselves up to identity fraud and/or theft charges if they get caught faking it.

hardtke 8y ago

There is an economics research paper that shows that ticket auctions on Ticketmaster can reduce the arbitrage profits of scalpers (https://faculty.chicagobooth.edu/eric.budish/research/Ticket-Auctions.pdf https://faculty.chicagobooth.edu/eric.budish/research/Ticket...) They compared the primary auction price to the ebay resale price and found they were about the same. It's unclear why ticket auctions never took off, although it may be that the only work well for shows with high demand.

ghobs91 8y ago

I mean couldn't you just solve all this by tying a ticket purchase to a name, and make them non-transferable? Can't sell a ticket if the buyer will have to provide your ID.

mseidl 8y ago

In Germany there's a law saying you cannot sell a ticket for more than the price listed on the ticket.

taejo 8y ago
Are you sure? The first result I found on Google was https://www.lhr-law.de/magazin/sportrecht/schwarzmarkt-rechtliche-konsequenzen-beim-weiterverkauf-von-eintrittskarten https://www.lhr-law.de/magazin/sportrecht/schwarzmarkt-recht... 8. Darf ich die Karte teurer als zum Normalpreis verkaufen? Ja, der Weiterverkauf von Karten zu einem erhöhten Preis ist nicht verboten. Eine Grenze stellt diesbezüglich lediglich der sogenannte Wucher nach § 138 Abs. 2 BGB dar, bei welchem sich jemand unter Ausnutzung einer Zwangslage eine Gegenleistung sichern lässt, die in einem auffälligen Missverhältnis zur eigenen Leistung steht. Nun könnte man annehmen, dass bei einem Weiterverkauf einer Eintrittskarte ein zehnfach überhöhter Preis nach gesundem Menschenverstand in einem auffälligen Missverhältnis zum tatsächlichen Fussballspiel oder zum tatsächlichen Konzert von Helene Fischer, den Rolling Stones oder anderen Künstlern steht und damit unzulässig ist. Dies ist aber gerade nicht der Fall, weil keine Zwangslage vorliegt, die ausgenutzt werden könnte (vgl. OLG Köln, OLGE 93, 193, 194f., wonach der um das Zehnfache erhöhte Preis für eine Eintrittskarte für ein Fussball-WM-Endspiel mangels Ausnutzung einer Zwangslage keinen unzulässigen Wucher darstellte). Im Ergebnis kann jeder frei entscheiden, wieviel ihm der Zutritt zu einer bestimmten Veranstaltung wert ist. but if you can cite something else I'd be interested.

fouc 8y ago

Ticket auctions seems like a reasonable way to be fair , and ticket master supports that http://www.ticketmaster.com/ticketauctions http://www.ticketmaster.com/ticketauctions I guess it depends on the artist for whether the auction is allowed or not?

totalZero 8y ago

Or alternatively, release tickets on a randomized basis leading up to the event, coinciding in probability with the frequency of event advertisement.