Why buy event tickets is more complicated than ever

When Dave and Marla Araki tried to get tickets to see the Eagles in Vancouver in May, what happened was over ] Heartache Tonight that Take C is Easy .

As soon as the tickets were available to the public, the Kelowna, BC couple, connected, clicked on "best seats" and bought a pair. For $ 1,360, they would have the privilege of sitting at the back of Rogers Arena's lower bowl.

Then the Arakis checked the price of the seats on the ground: at 13 ranks of the stage, they could get $ 67 more. They looked around the map of the arena squares on the Ticketmaster website: it was a sea of ​​magenta colored dots. Each of these points represents a "verified resale" ticket – not an original ticket, but a being resold by its owner. Blue dots, or originally priced tickets, were scarce and spaced

It turned out that the couple had bought tickets resale first, with huge markup. It was "ignorant of us" not to see road signs along the way, he admits – but he still felt fooled. "I do not think, a minute to the sale, that I literally buy old notes." But because of the presales of concert tickets, as for fan club members and some credit card holders, reams of tickets were already posted for resale.

The eagles, the couple decided, were too beautiful to look at from a distance. In the end, they upgraded the tickets and tried to sell their lower seats. A few months later, on the approach of the show, Mr. Araki again watched and found seats at Ticketmaster for $ 99 apiece. "I feel horror for anyone who has ever experienced the same kind of situation and bought tickets without knowing it because he thought it was his only choice," says Araki.

Fluctuations in prices, which fluctuate day-to-day a live market, used tickets mixed with originals on the same site: this is the new reality of the organization of concerts renowned, theatrical performances and sports games. The purchase of a ticket for a coveted event is, more than ever, like booking a hotel room or a plane ticket, as the formerly simple business model encompbades digital disruption and turns to algorithms and free market prices. In the live event industry, consumers are told that they are doing everything they can to get tickets in the hands of real fans rather than resellers. But the industry has, at the same time, taken the habit of playing the game of scalpers. Companies such as Ticketmaster are encouraging consumers to resell tickets while taking advantage of part of the profits, raising initial prices for many seats and introducing "dynamic pricing" programs that increase the cost of events when demand is high.

They do it because they know that people will pay the little – or a few hundred – dollars.

"They learn what price the market will support and how it will evolve in real time," says Catherine Moore. , Assistant Professor of Music Technology at the University of Toronto. What is happening is the technological remodeling of an industry that has long relied on conjectures to set prices. It has also left consumers confused and indignant, and everywhere governments have doubted what, if any, to do about it.

The industry has been evolving towards this model for years, but it is now accelerating, thanks in part to a battle between Ticketmaster (owned by US entertainment giant Live Nation Entertainment) and markets such as StubHub (owned by EBay Inc.). for the supremacy in the online resale market of tickets. Resale of tickets became an unlikely Canadian political issue in 2016, too, when Tragically Hip's last tour with the late leader Gord Downie was met with mbadive demand and frequent scalping. When a member of Parliament from Kingston's hometown introduced a private member's bill addressing resellers shortly after the group's final show, it became a comprehensive review of Ontario's ticketing laws.

Other provinces quickly jumped. British Columbia is reviewing a survey of 6,500 consumers to see what they should do. Alberta plans to require suppliers such as Ticketmaster to proactively identify tickets purchased through a quick ticket "bot" software and cancel them. In June, the Quebec National Assembly adopted a series of revised rules that prohibit robots and guarantee repayments in certain circumstances. And when Ontario's review was completed, the Liberals of the day opted for harsh regulations, notably banning the resale of tickets for more than 150 percent of the original price before taxes.

This rule came into effect on July 1. It lasted three days until the new Progressive Conservative government of Doug Ford put an end to this part of the new Ontario ticketing laws to review it. In the meantime, ticket sellers can return to the charge, regardless of the market. Consumers, meanwhile, are left behind, caught between a ticketing industry fascinated by the benefits of the free market and a series of governments that can not agree on how the industry should be regulated.

Araki is a former radio personality who had the habit of interviewing people who would camp in ticket booths to get tickets to see their favorite artists. He thought that the heaviness of ticket buying was gone thanks to the internet. He now believes that he was wrong.

As fast as a ticket Ways to resell tickets – first on clbadified ad sites such as Craigslist, and later on more marketplaces Forms like SeatGeek and Stubhub, which have created a lively secondary market for tickets. But the scalpers have also adopted digital technology, and the stereotype of big mouths outside the arena has finally given way to coders who manufactured software "bot" to buy as many tickets as possible.

to beat these new-age scalpers – usually by upgrading their technology with more technology, like captcha puzzles and fog letters designed to prove that a buyer is human – to give fans their setback. Ticketmaster has blocked five billion bots in 2016 alone and says he's been stopped a lot more since.

Lately, however, the company has changed its story. Higher prices, he says, will solve the problem by reducing the profits of scalpers.

"These things that we try to fight, and that have historically struggled with technology, with Captcha tools and with data science, all these things are symptoms of an illness and a lots of drugs to treat the symptoms "Jared Smith, President of Ticketmaster. "The reality is: The disease itself is the pricing.The reason why all this exists is because we have clbadically underestimated the banknotes."

In an interview, Mr. Smith was unequivocally on the rise ticket prices to reduce scalping. While cheaper tickets for less desirable seats and events will still be available, he said, the secondary market for notes is becoming a mature source of income for companies like his. Ticketmaster estimates that the North American resale market is worth $ 8 billion. Half of this amount represents initial face-value ticket prices, but still leaves $ 4 billion on the table

Scalpers take advantage of the gap between the initial price of a ticket and the price that people are willing to pay. Requiring the best seats in a room from the outset reduces the spread – and ensures that the customer who is willing to spend $ 1,000 to see Justin Bieber a few meters away spends it directly on Ticketmaster. In turn, more money flows into the industry of live events, including the artist or sports team, their backers, promoters, venues and, well, Sure, Ticketmaster.

But that's only the beginning. Dynamic pricing, already common in sports, allows ticket prices to increase and decrease depending on demand, allowing the seller to increase the price if the demand is there (and lower if it is not the case). Many Ticketmaster tickets now have this kind of dynamic "flexible" price in small distances, says Smith.

For a handful of the best seats in a room, however – about 2 percent to 4 percent for a given event – the company presents "platinum" tickets, which it prices according to the market, varying with time to see consumers are willing to pay. Ticketmaster hopes that more artists and sports teams will feel comfortable with the pricing model and give their permission to use it up to 10 times the seats that are available. They are currently occupying, which will bring more revenue to the whole chain. The record industry has been playing with dynamic prices for decades, but on a smaller scale. The San Francisco Giants started tinkering almost 10 years ago and now practice is common in Major League Baseball and other professional sports. In 2001, when the producers of The Brooklyn in New York decided to almost quintuple the price of the high-demand seats at $ 480 to fight against scalpers, doubts are mounting in Broadway – but the price tickets The norm [19659003] Taylor Swift is one of the greatest artists who push emissions to market value. For her show on August 3 at Toronto's Rogers Center, you can still buy original tickets just off the stage for $ 1,125. Some social media critics have suggested that such high prices would leave a series of empty places – but a person familiar with the tour, who was not allowed to discuss it, told The Globe and Mail that his tour Reputation was expecting to shoot significantly more revenue than its predecessor, for the album 1989 . In this new event reality, some empty seats are not worth being worried about.

If you want to see Drake's concert in Toronto

on August 10, be prepared to pay a premium

. This table shows the cheapest available floor ticket

entered on

Ticketmaster over a period of the week to end

June, relative to the initial selling price.

Note: Prices include fees. The order processing fee

may result in a small price change. Ticketmaster

prices were checked daily at about

same time. Cheap tickets were available

at some point during the day.

THE GLOBE AND THE MAIL, SOURCE: TICKETMASTER

If you want to see Drake's concert in Toronto on August

10, be prepared to pay a premium. This table shows

the cheapest available floor ticket listed on

Ticketmaster over a period of the week at the end of June

in relation to the initial selling price.

Note: Prices include fees. The order processing fee may cause

a slight variation in prices. Ticketmaster prices were checked daily

at about the same time. Cheap tickets were available at some point during the day.

THE GLOBE AND THE MAIL, SOURCE: TICKETMASTER

If you want to see Drake's concert in Toronto on August 10, be prepared to pay a premium

. This table shows the cheapest available floor ticket listed on

Ticketmaster over a period of the week at the end of June, compared to the initial selling price

.

Note: Prices include fees. The order processing fee may result in a small price change.

Ticketmaster ticket prices were checked daily at about the same time. Less expensive tickets

were available at some point during the day.

THE GLOBE AND THE MAIL, SOURCE: TICKETMASTER

Digital resale sites had to finally reveal the real behavior of the ticket markets. Ticketmaster was first sold at the purchase of the TicketsNow Marketplace in 2008, which promptly caused the buyer 's remorse. When Irving Azoff – coincidentally, the Eagles' longtime director – took charge of Ticketmaster shortly thereafter, he said that he "would never have bought it" and that resale should be illegal. These comments were made at a US Senate Committee hearing on another mergers and acquisitions project – a merger with the Live Nation mega-booster – completed in 2010.

In 2013, Ticketmaster was selling original and resale tickets on his website; the system is now the norm for many of its large-scale events. The reasoning is simple: "It was obvious that there was still money on the table," says Pascal Courty, professor of economics at the University of Victoria, who studies ticketing.

According to a 2017 Research and Markets report, the resale market for banknotes will post a compound annual growth rate of 13% until 2021. Live Nation documents show ticketmaster volume of transactions for banknotes d & # 39; occasion. sold – rose 16 percent last year. StubHub, meanwhile, has processed $ 4.52 billion worth of notes in 2017, about 5% higher than the previous year, generating $ 1 billion in transaction revenue, according to the annual report. d & # 39; eBay.

In Ontario, the Attorney General's office estimated last year that approximately 80% of ticketing in the province is provided by Ticketmaster and StubHub, which has aggressively invested in Canada since 2015.

Where the main sellers such as Ticketmaster deal with StubHub consider these tickets as products to be freely traded. Devin Wenig, CEO of StubHub's parent company, eBay, described this philosophy in an interview with The Globe last year: "I think efficient markets are good for consumers."

Notably, the Free market-oriented market does not like the word "scalping" – because the director of government relations at StubHub, Laura Dooley, says that there is nothing illegal to sell tickets now in many North American jurisdictions, which benefits many small businesses – usually brokers. "I think the term" scalping "perpetuates the idea that it's not legal."

North America has a patchwork of different ticketing laws, some more hyperspecific than others. The SeatGeek resale market describes a number of them: Resale of tickets is legal in Hawaii, for example, except for boxing matches; Illinois requires that anyone reselling tickets be registered with the state as an official broker; The State of New York has just revised its laws, including a mandate for resale websites to disclose the total price of tickets, including fees.

In Canada, it is the disease of a Canadian icon who propelled the ticket into the political arena.

After Mr. Downie announced that he had terminal brain cancer in 2016, the last Tragically Hip tour became collective. , national moment – with scalped bills of up to $ 5,000 for the final show in Kingston. Music Canada Live, the concert-industry badociation, pointed out that the problems of the tour were related to mbadive demand – four million people have tried to buy 200,000 tickets. Despite this, the Ontario government has openly cited the Hip tour last year as a reason to revisit its ticketing laws.

A little over a year ago, in the shadow of Toronto 's Rogers Center, one of the largest sites in the country, the Attorney General General of the time, Yasir Naqvi, introduced a series of new regulations. "The software often used by scalpers would become officially illegal." Many transparency measures would come into effect, requiring Ticketmaster and StubHub to list the total cost of a ticket, including service fees, at the same time.

But the gem of the new legislation was the rule that tickets could not legally be resold for more than 50 percent of the original price, minus taxes. (Up to In 2015, it was illegal to resell tickets with markups.) Mr. Naqvi, who was not available for an interview before the Liberal government and he was removed from the June provincial election, said Last year that the measure prevented the bad actors from driving up prices, but allowed fans to continue going online to resell tickets for a reasonable amount.

A year later, no one knows not how much the law will change for consumers. Bureaucrats in charge of the law will not say whether the funding promised by Mr. Naqvi to enforce ticket laws will materialize. A government spokesperson said by email that the Ministry of Government and Consumer Services "will exercise authority and use resources" to investigate complaints and enforce the rules and that the police "will continue" its efforts to combat bots. Meanwhile, Ford's new government said this week that it would stop applying the 50 percent price cap rule to determine whether it would actually protect consumers, temporarily putting it on hold. a term to one of the greatest laws.

Companies running ticketing websites say the Liberals have left vague instructions on how they are supposed to comply with the new laws. While Ticketmaster claims that he had everything planned to be ready on July 1, StubHub management told the Globe that it would take him more time on some issues – and that price caps, that many consumers were waiting impatiently, would return to the sellers of individual tickets.

Another secondary market, Vivid Seats, had effectively ceased operating in the province as of July 1, telling consumers that the new law "limits the ability of fans to buy and sell tickets." Friday, Vivid Seats in Ontario again. In an email, his Vice President of Legal Affairs, Chris Libertelli, said, "We appreciate the government's willingness to address the provisions of the law that may not be suitable for consumers."

Last May , leaders and industry experts from live events have expressed frustration with Ontario 's new regulations. It turned out that price caps were a subject on which the competitors of Ticketmaster and StubHub agreed.

"Regulating supply and demand is futile in the world of pbadion-based ticketing," says Patti-Anne Tarlton, Ticketmaster Canada Manager. Jeff Poirier, general manager of StubHub for music and theater in North America, echoed it: "It's a futile effort." The move from the Ford government this week gave the industry what that she wanted, at least for the moment. After the concert, Mr. and Mrs. Araki struggled to resell their high-priced tickets, even with a steep discount. Finally, they decided to use the tickets they had paid and ended up giving their tickets to their friends.

When The Globe described Mr. Araki's experience with Mr. Smith of Ticketmaster, he defended the resale practices of the company. as tools to prevent fraud and offer more income to artists. "If we say," Hey, we will not sell, "it will not prevent resale," Smith said. "What we did, is create a product … totally transparent, unlike anything that is done in the industry."

But there are concerns within the industry to pursue higher prices. wildly fluctuating could be used to undermine the company as a whole.

"If you complicate the situation, people will say," Enough, I can watch Netflix, "says John Karastamatis, chief of communications for Mirvish Productions of Toronto. While the company sells tickets according to demand – the first clbad seats for low-priced musical tickets Come from Away vary between $ 200 and $ 250 depending on the dates of booking and performance – Mirvish uses its own ticketing system Do not resell tickets. Companies that, he says, "provide a platform to deceive the potential customer."

Confidence is already thin among some consumers, even when the industry makes amends. A few weeks after the Eagles show, Mr. Araki received a reprieve. After endless calls with Ticketmaster's customer service, he says that he eventually moved on to another department and received a full refund. But after months of struggling to recover his money, Mr Araki has lost confidence in buying tickets online. "I felt really stripped of this process," he says. "We have always considered them a source of trust."