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== Purchase and re-sale methods ==
== Purchase and re-sale methods ==


Ticket resellers use several different means to secure premium and previously sold-out ticket inventories (often in large quantities) for events such as [[concert]]s or [[sporting event]]s. Established resellers often operate within vast networks of ticket contacts, including season ticket holders, individual ticket resellers and ticket brokers. They make a business out of getting customers hard-to-find and previously sold-out tickets that are no longer available through the official box office. More commonly, obtaining tickets through special presales has become more common. These presales often use unique codes specific to an artists fan club or venue. The advent of [http://www.concertspy.com presales]
Ticket resellers use several different means to secure premium and previously sold-out ticket inventories (often in large quantities) for events such as [[concert]]s or [[sporting event]]s. Established resellers often operate within vast networks of ticket contacts, including season ticket holders, individual ticket resellers and ticket brokers. They make a business out of getting customers hard-to-find and previously sold-out tickets that are no longer available through the official box office. More commonly, obtaining tickets through special presales has become more common. These presales often use unique codes specific to an artists fan club or venue. The advent of [http://www.presalemaster.com presales]
has allowed more individuals to participate in reselling tickets outside of a brokers office.
has allowed more individuals to participate in reselling tickets outside of a brokers office.
[[Image:Scalper1.jpg|thumb|right|A ticket scalper at work]]
[[Image:Scalper1.jpg|thumb|right|A ticket scalper at work]]

Revision as of 19:45, 18 March 2008

Ticket resale is the act of reselling tickets for admission to events. In British English, one who resells tickets is often called a tout, and in American English, Canadian English, and Australian English, such a person is often called a scalper, and the practice is called scalping. However, these are colloquial terms used to refer to individuals selling tickets on the street, outside a venue or event. Established companies in the business of reselling tickets prefer to call themselves ticket brokers though many fans still consider it scalping regardless of what euphemism is applied to it. Registered businesses reselling tickets to popular events are bound by laws, such as local and state laws in the United States, and must operate within those laws to maintain their status as a legitimate business. Like the scalpers of old, however, there are no restrictions on how much ticket prices can be marked up.

Ticket resale is a form of arbitrage that arises when the amount demanded at the sale price exceeds the amount supplied (that is, when event organizers charge less than the equilibrium prices for the tickets).

Purchase and re-sale methods

Ticket resellers use several different means to secure premium and previously sold-out ticket inventories (often in large quantities) for events such as concerts or sporting events. Established resellers often operate within vast networks of ticket contacts, including season ticket holders, individual ticket resellers and ticket brokers. They make a business out of getting customers hard-to-find and previously sold-out tickets that are no longer available through the official box office. More commonly, obtaining tickets through special presales has become more common. These presales often use unique codes specific to an artists fan club or venue. The advent of presales has allowed more individuals to participate in reselling tickets outside of a brokers office.

File:Scalper1.jpg
A ticket scalper at work

Scalpers also use automated software to get hundreds of tickets in the first moments of Internet onsales, getting an unfair advantage on fans trying to buy the same tickets. Ticketmaster filed a lawsuit against a company that manufactured and sold software designed to get around Ticketmaster's security measures.

Ticket scalpers work outside events often showing up with unsold tickets from brokers' offices on a consignment basis or showing up with no tickets at all and buying extra tickets from fans at, or below face value with their own money on a speculative basis hoping to resell them at a profit. There are many full-time scalpers who are regulars at particular venues and even have a following. These full-time scalpers are often sought out by fans hoping for a last minute deal and are comfortable buying from a familiar face knowing they are not likely to be ripped off by a stranger with counterfeit or stolen tickets. However, there are plenty of scam artists that sometimes follow a concert tour from city to city selling fake tickets to unsuspecting buyers for whatever they can get.

Ticket brokers operate out of offices, and use the internet and phone call centers to conduct their business. They are different from scalpers in that they offer a consumer a storefront to return to if there is any problem with their transaction. The majority of transactions that occur are via credit card over the phone/internet. The services that ticket brokers offer often can include hotel and airfare to events.TicketGiant.net is a ticketbroker that has been in business 20 years

A notable recent example of re-selling occurred at the 2004 Glastonbury Festival. Tickets, initially offered for sale online, were sold out within the first few hours of availability; however, afterwards, large numbers of tickets started appearing on eBay and other online marketplaces. Not only professional ticket resellers were involved; many ordinary concert-goers had, apparently, purchased twice the number of tickets they required then sold the unused tickets at double the original price, thus effectively getting their own tickets for free and further clouding the already fine line between ticket reseller and concert-goer.

Derivatives

Although it was a practice in use mostly in the 1980s most often for concerts more than other events, some ticket brokers offer tickets even before the tickets are officially available for sale. In such scenarios, those ticket resellers are actually selling forward contracts of those tickets. One example is a company called TicketReserve, which is making money by selling "options" on future sporting events. This is often possible if the reseller is a season ticket holder. Season ticket holders generally receive the same exact seat locations year after year thus they can enter a contract to deliver on tickets that they own the rights to, even if those tickets have not even been printed or sent to the original ticket holder. This presale practice has fallen out of favor as ticket buyers are now accustomed to viewing online available inventory on broker sites and receiving their purchases the next day via overnight delivery.

Another company, Yoonew, provides a market by which sports ticket derivatives can be traded between users.

Criticism of re-selling

File:Scalper2.jpg

Individuals who genuinely wish to attend a popular event may find themselves unable to get tickets, as they have already been sold to ticket resellers. This practice enables the ticket resellers to sell the tickets at market value, with no effective loss because they had no intention of attending the event in the first place. Resellers argue that there is a fine line between the individuals who genuinely wish to attend a popular event (and decide to sell on their tickets later) and those that buy tickets in large quantities in order to resell their tickets for a hefty profit. The practice of reselling tickets may be defended on "free market" principles although some countries have outlawed the unauthorized resale of tickets (usually with exceptions where the reseller doesn't profit from the transaction).

Resale of tickets at sold-out events can also encourage those without tickets to turn up at the venue, in the hope of purchasing one. This can cause crowd control problems, with numbers in excess of the venue's limits approaching it, and the access of those with tickets being hampered by a sizeable number of those without.

Responses

A concern when buying tickets on the street from a ticket scalper or via an online auction, is that the tickets sold by ticket resellers may themselves be stolen or counterfeit. For many major sporting events counterfeit tickets are auctioned off in the months leading up to the event. These criminals and their activities are not to be confused with legitimate ticket brokers and individuals who abide by law to legally resell tickets on the secondary market.

It is controversial whether tickets are a good which can be privately resold. Some parties argue that the money paid to the organisers is actually paid for the service of attending the event, which a buyer cannot resell because the buyer does not have the service to sell. Other parties argue that tickets are paid for by consumers and should be transferable just like any other good. Typically private resale will contravene the original conditions of sale, but it's legally questionable whether the original conditions of sale are even enforceable.

In the United Kingdom resale of football/soccer tickets is illegal under section 166 of the Criminal Justice and Public Order Act 1994 unless the resale is authorized by the organizer of the match, such as what viagogo is doing through its partnerships with Chelsea FC, Manchester United, and Everton FC.

File:Scalper3.jpg

In the United States, ticket resale on the premises of the event (including adjacent parking lots that are officially part of the facility) may be prohibited by law, although these laws vary from state to state and the majority of U.S. states do not have laws in place to limit the value placed on the resale amount of event tickets or where and how these tickets should be sold. Ticket resellers may conduct business on nearby sidewalks, or advertise through newspaper ads or ticket brokers. Some U.S. states and venues encourage a designated area for resellers to stand in, on, or near the premises, while other states and venues prohibit ticket resale altogether. Resale laws, policies and practices are generally decided, practiced and governed at the local or even venue level in the U.S. and such laws and or interpretations are not currently generalized at a national level.

Another issue in the United States is that since ticketing laws vary by state to state, many ticket resellers use a loophole and sell their tickets outside of the state of an event. Therefore, a ticket reseller who is reselling tickets to an event at New York's Madison Square Garden is not subject to New York State's markup laws as long as the sale takes place outside of New York. The majority of ticket brokers in the New York metropolitan area have their offices in bordering states New Jersey and Connecticut for this reason.

Depending on the Ticketing body's conditions of sale, tickets may be cancelled, or the ticket holder refused admission, if tickets are resold at a premium (for a profit). This is so with Ticketek tickets (Ticketek is an Australian based ticketing company). Efforts to clamp down on ticket resale have included labelling tickets with the name or a photograph of the buyer,[1] and banning people without tickets from the near vicinity of the event (where they might otherwise congregate hoping to buy a ticket from a ticket reseller at the last minute).

Online auction sites like eBay only enforce state ticketing laws if either the buyer and/or seller resides in the state where the event is taking place. Otherwise, there is no resell limit for tickets.

Selling tickets by ballot

Some promoters have ceased selling tickets in the traditional first-come-first-served manner, and require prospective ticket holders to enter a "ballot" — a competition with random winners — with the prize being the opportunity to purchase a small number of tickets. The ballots are intended to discourage re-selling by making it harder to purchase large numbers of tickets because being at the front of the queue does not guarantee the holder a ticket.

Events that have sold tickets by ballot include the Big Day Out in 2007[1] and the 2006 Commonwealth Games[2]

A similar practice used among ticket resellers is to list an item as an online auction (such as eBay) - most commonly an innocuous item such as a collector’s card - and give the tickets as a bonus to the winning bidder; thereby not actually selling tickets in order to circumvent ticket laws. It should be noted that this does not actually get around eBay's selling rules, as they effectively state that the goods that the buyer receives are what the seller is selling, including any free bonuses.

Selling tickets at auction

In September 2003, Ticketmaster announced plans to sell tickets in online auctions, which will bring the sale price of tickets closer to market prices. The New York Times reported that this could help the agency determine demand for a given event and more effectively compete with ticket resellers.[2] As of 2007, Ticketmaster still sells tickets at auction in the United States.[3]


See also

Notes

  1. ^ New bid to stop Glastonbury touts, BBC News
  2. ^ Ticketmaster Auction Will Let Highest Bidder Set Concert Prices in The New York Times, accessed on February 24, 2007.
  3. ^ Ticketmaster : Auctions, accessed on February 24, 2007.
  • STAR The Society of Ticket Agents and Retailers. Self-regulatory ticket body for the UK entertainment industry.
  • Yoonew The world's first exchange for trading sports tickets and sports ticket derivatives.
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