Economics of stubhub-style ticket reselling

Factual Questions
1

Back during the World Series, I was toying with splurging and trying to get last-minute seats to one of the games (although I ended up not doing so). Anyhow, I was pretty amazed by the number of seats available on StubHub. Which got me wondering how the economics of that, and similarly popular things like Book of Mormon, work. My guess is it’s basically like this:
(a) at some point, like 9 a.m. on March 3 or whatever, a bunch of tickets are scheduled to go on sale online through the “official” ticket source
(b) there are a bunch of people who pay attention to this kind of thing, who are hovering on their computers at 9 a.m. that day, and all the tickets are bought up instantly at face value
© then nearly all of them are immediately put up for sale on StubHub, because the vast majority of the 9 a.m. hoverers just want to make a profit, not go to a world series game or production of the Book of Mormon.
(d) For sports events, of course, some number of the tickets go to season ticket holders. But I’d think that at least a fairly good percentage of people who care about the SF giants enough to get season tickets would want to attend the world series. Or do people get season tickets and then just stubhub all the individual games?

So this means there are some number of people out there who are either supplementing or creating their income by buying tickets and then reselling them, all without ever leaving their houses.
Is this analysis basically correct? How many people do this? Are there just 10 or 20 people who scalp thousands of tickets each for every event? Or are there limitations on how many tickets an individual can buy?
Also, why don’t the official ticket sellers raise their prices for anything that is super popular? Is there some kind of anti-trust legal stuff involved? It seems clear that they’re leaving money on the table if so many of their tickets are being resold at higher than face value…

2

I can’t give detailed answers to all of your points, but I can address a couple of them.

  1. Many season ticket holders sell most if not all of their games, including post-season. I have sold early round playoff tickets most of the last 7 years I’ve had tickets. I did, however, go to the World Series games I’ve had (although I have sold an inconvenient NLCS game). The seats around me are all season tickets and I know many of them - quite a few sold WS tickets in both 2006 and 2011 in order to pay for their tickets the rest of the year.

  2. MLB gets a cut of StubHub profits. Many also now do some amount of “dynamic pricing” that accounts for demand differentials. It’s harder for them to do that for season tickets, and since that is where a ton of the revenue comes from they still general have a flat package.

  3. World Series ticket prices are set by MLB, not by the teams. Not totally relevant, but perhaps an interesting data point for why tickets in, say, New York are the same as in Kansas City (heh, World Series in KC…).

3

One issue could be that promoters want to sell all the seats. The buzz created by sold-out shows could be worth some lost revenue. Another issue is they may want to get the money up front - now, rather than later. Another is there’s always some risk involved. You might think you can sell those tickets for three months from now at a profit, but it might turn out you can’t.

4

Well, Jas09, next time I’m in STL and want Cardinals tickets, I just might ask you!

One comment about StubHub for baseball tickets - it can be a good way to get a ticket to a regular season game at below face value. Something to keep in mind, and when I first learned about this, I was surprised. I was able to do this when visiting KC, Toronto and Cleveland this year. My ticket to the Royals game was $8 for a lower deck, infield seat.

5

  1. I don’t have full season tickets, but do have a partial plan. Until 2 years ago, I didn’t get to choose individual games- just the plan. The individual games were prepackaged. This meant I started off the season selling at least one or two tickets.

  2. Because I have a partial plan, I get to buy post-season tickets. I don’t get to pick which games (s) ( it will be “one game in the division championship and one World Series game” or something like that. Larger plans get more games , and full-season ticket holders get every game ) , and I don’t think I find out the dates until after I’ve bought them. I haven’t had to sell tickets because of this, but I know people who have.

  3. I’m limited to one post-season package for each seat in my regular package. I can enter the lottery to buy additional tickets. Perhaps it’s “only in NY”, but we can’t just call the ticket office at 9 am. We have to enter a lottery by email in order to even have the opportunity to buy tickets outside of the plan holder sale. If we get an email back saying we can buy tickets, there is a limit.