I don’t often spend much time reading bills and laws. But today I did.
As a primary ticketing provider for over fifteen years, you may be surprised to hear me say, “We need to regulate our industry.” And it seems we’re finally headed there.
Why? Because unregulated industries give us what? Unsustainable models (banking). Inflated pricing (prescription drugs). Little concern for the end user or consumer (pretty much everything). People doing whatever the hell they want (Facebook).
Regulation is necessary as long as humans remain greedy. But many business leaders fear any government regulation as they believe that left to ourselves, capitalists will do the right thing: make a good profit, hire more people and treat the end user right. That’s the way it works, right?
Yes, until it doesn’t.
Even with regulation, how many of us are happy about what we pay for some of life’s most necessary elements? Energy. Fuel. Internet. Food.
What about ticketing? Ours is an industry where you create a product – the event experience. You sell tickets, the collective group of stakeholders perceive at a fair price and that makes a profit; and at the same time, get enough people to buy to make it work. It’s basic supply and demand economics on a disposable income or luxury purchase.
Sometimes we get it right. But as the wealth gap continues to grow, we have many events where there are enough people with large disposable incomes that they can afford to pay many multiples of that “reasonable” price that a market was created to feed. As a result, most average consumers know that for the major events they will simply never be able to go. (I’m talking Super Bowl, Masters Tournament, World Series).
They are left to choose from the events the high dollar buyers don’t want or don’t know about. Or fight to buy a ticket. Or pay the multiples required to get in. Or simply choose to make a major sacrifice for their one night of pure joy.
I’m assuming the reader understands that ticketing, like nearly every other market, has multiple channels of distribution. For the most part, we call them primary and secondary. In full disclosure, I am a primary ticketing provider in N America and have no official secondary partner.
The secondary market is – if controlled – a valid distribution channel. I use it frequently when I travel outside my home state and want to attend an event that is either sold out or has no good inventory left. Commonly, this might be an NFL or MLB game or a Broadway show. In the major sports, there are always season ticket holders who can’t or don’t want to attend a specific game. Facilitating this re-sell is a service provided by the secondary market that works for both buyer and seller.
Until it doesn’t. Unregulated fees on three major secondary sites offered me up convenience fees of $150+ per ticket on a $600 playoff game. That’s a forty-percent fee not to mention the face value of 3-4x initial price.
The only way to attend the game was to close my eyes and hit submit. Because I can.
In the days of free shipping and no processing fees from Amazon and others, the ticketing industry is still “enjoying” a heyday of exorbitant fees and crazy-inflated prices. I worry that we’ve gone so far that the greed is winning. I’m glad every day that it’s not my job to figure out, for example, how to fix our prescription drug prices in the US. How do you roll back from that kind of market?
I believe you start with some common sense regulation when you have an out of control market. With our billions of dollars in tickets and fees, the industry can bear it. Already with the BOTS Act of 2016, we are getting started.
The FTC says it this way in the above article:
“It used to be a rite of passage: spending the night in a line outside the box office to score tickets to the Stones, Springsteen, or [insert your favorite group here]. The convenience of internet ticket sales ended the sleeping-on-the-sidewalk ritual. But online ticket sales raised another concern: Were prospective buyers losing out to computer programs that scooped up the best seats only to resell them at inflated prices? Congress responded to that issue by passing the Better Online Ticket Sales Act of 2016.”
Focused solely on the illegal purchase method, the BOTS Act has done little to curb inflated prices or, fees; or eradicating copycat websites that seek to bypass the primary point of sale and lure in less-savvy buyers to paying more; or worse, buying a fake ticket that won’t gain you access to the event.
Add to this that ticketing has long been a ”caveat emptor” industry. Starbucks messes up your five dollar latte? Get another one. Steak was undercooked. We’ll fix it. Shirt doesn’t fit or launder well, TV breaks, cell phone breaks? All can be remedied through refunds, exchanges, and insurance.
But buy a $200 event ticket and get the flu. Sorry, ma’am, no exchanges or refunds.
Yes, I represent this industry. And make my living from it. But I believe that any industry that leaves its customer concerns out of the picture is not sustainable and will at some point fall to the recourse of the same buyers.
Both the FTC in Washington, DC and the provincial government in British Columbia are opening the regulation door in both the primary and secondary market. Aside from banning BOTS, the BC Bill 27 seeks to make the resale of tickets more fair. It places responsibility on both the primary ticketers – who must “exercise reasonable diligence to detect the purchase of a ticket through the use of software described in subsection and cancel any ticket the primary ticket seller reasonably believes was purchased from the primary ticket seller through the use of software described in subsection.”
And secondary sellers will have to refund customers, such as in the case of event cancellations or counterfeit tickets. And no – right now they don’t have to.
The United States isn’t far behind. The FTC provided a forum for consumers to present their ticketing woes and horror stories of exorbitant fees, no refund policies or inflated pricing to the public. The Online Event Tickets Workshop is scheduled for June 11, 2019 in DC. According to the FTC website, the workshop “will explore consumer protection issues in the online ticket marketplace for events, such as concerts and sporting events. Topics include practices that limit ticket availability on the primary market, mislead consumers about ticket prices or availability, and confuse consumers about the entity from which they are purchasing.”
And the US Government Accountability Office (GAO) recently issued the report Event Tickets: Market Characteristics and Consumer Protection Issues, which examined ticket pricing, resale practices and fees.
I’m fully aware of the power of our industry’s lobby versus the consumers. Any legislation that passes will get diluted enough to protect the major players while giving a nod to caring about the cost of live entertainment for the mass consumers.
Which may cause us to ask, “Is live entertainment a luxury item?” or is it a vital part of the fabric of our lives – where we go to celebrate, cry, learn, love, shout, build community and express the beauty of life? Should it not continue to be a reachable part of everyone’s lives?
I remember well when Jerry Colangelo brought baseball to Phoenix. He felt deeply that everyone should be able to enjoy the sights and sounds of our beautiful ballpark and offered up tickets for just one dollar. I could get a family pack of 4 tickets, hot dogs and drinks for twenty bucks. And we all fell in love with the team that won us the World Championship a few short years later.
Accessibility to events of all types is critical to living a balanced and happy life. Those who seek to price consumers out of the joy of attending a favorite event are part of the ever-widening gap between the rich and poor.
Live events are one of the ways we celebrate, mourn and sing together. Imagine life without live. Some say regulation is the start of a slippery slope of heavy regulation on our industry. I say, we’re already skating down the slope to elitism and we must – if we are to save our industry – take a hard look at anything that helps us bring back Colangelo’s mission of access for everyone.
After all, life is better live.