# Why is ticket scalping a viable business? **URL:** \ **Category:** Factual Questions\ **Created:** [January 29, 2016, 8:35am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562 "2016-01-29T08:35:56Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Diceman](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Diceman](https://boards.straightdope.com/u/Diceman)\ **Post date:** [January 29, 2016, 9:09pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/21 "2016-01-29T21:09:38Z")
> [@Really\_Not\_All\_That\_Bright](#): > > What I don’t understand is how scalpers buy tickets using bots. Ticketmaster uses CAPTCHAs and other anti-bot mechanisms to prevent this, doesn’t it? If the venue itself is scalping tickets, then half the tickets never get to Ticketmaster in the first place. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [January 29, 2016, 9:14pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/22 "2016-01-29T21:14:58Z")
How can the venue be “scalping” tickets? It’s a first run seller? ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [January 29, 2016, 9:35pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/23 "2016-01-29T21:35:17Z")
> [@Really\_Not\_All\_That\_Bright](#): > > How can the venue be “scalping” tickets? It’s a first run seller? It could sell the tickets to a separate company which it also owns. ---
**Author:** ![Doug\_K](https://avatars.discourse-cdn.com/v4/letter/d/b5ac83/32.png) [@Doug\_K](https://boards.straightdope.com/u/Doug_K)\ **Post date:** [January 29, 2016, 10:37pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/24 "2016-01-29T22:37:30Z")
> [@Freddy\_the\_Pig](#): > > Venues do not unilaterally set prices for big-time acts that sell out arenas. The prices and the rent for using the facility will be specified in the contract between the entertainer and the venue. For an example, see this [discussion](http://www.atu2blog.com/u2-at-giants-stadium-a-look-at-the-live-nation-concert-contract/28544/) of the contract between U2 and the stadium authority which manages the Meadowlands. > > Entertainers set prices (relatively) low, for the reasons already described by **Alley Dweller** in Post #2. The disconnect between long-term entertainer interests (moderate prices) and short-term supply and demand (high prices) creates arbitrage opportunities which are _very_ difficult to manage out of the market. In many, if not most, cases, the ticket prices are set by the promoter (in the linked article the promoter is Live Nation), not the artist. The promoter pays the artist’s fees and other expenses, including venue rental, and is the one will lose money if it doesn’t sell. ---
**Author:** ![Hari\_Seldon](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hari_seldon/32/5173_2.png) [@Hari\_Seldon](https://boards.straightdope.com/u/Hari_Seldon)\ **Post date:** [January 30, 2016, 12:54am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/25 "2016-01-30T00:54:06Z")
There is (or was when I was growing up, a long time ago) a federal law that mandated that all the tickets on the same row in a theater had to be sold at the same price. If that law is still around, then the Dutch auction would be illegal. I once asked a guy selling tickers to a baseball game _below_ list price how he made a profit. He told me he bought group tickets for a substantial price reduction. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [January 30, 2016, 8:05am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/26 "2016-01-30T08:05:47Z")
> [@Hari\_Seldon](#): > > There is (or was when I was growing up, a long time ago) a federal law that mandated that all the tickets on the same row in a theater had to be sold at the same price. If that law is still around, then the Dutch auction would be illegal. I had never heard of that term, and figured I just made up the concept since I also never heard of an auction being conducted that way. It does seem like a good system, so I wonder why it’s not more popular. ---
**Author:** ![Jonathan\_Chance](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jonathan_chance/32/701_2.png) [@Jonathan\_Chance](https://boards.straightdope.com/u/Jonathan_Chance)\ **Post date:** [January 30, 2016, 2:11pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/27 "2016-01-30T14:11:01Z")
> [@Little\_Nemo](#): > > It could sell the tickets to a separate company which it also owns. Indeed. A prime example of this is the case of the Chicago Cubs in 2002. The Cubs were discovered to be owners of a ticket reseller - scalper, in the vernacular - to which they would sell tickets at face value preferentially. The reselling organization would then mark the tickets up to whatever the market would bear. Checking, it seems the Cubs [won the case brought against them](http://sportsmockery.com/2015/07/chicago-cubs-get-caught-scalping-tickets-to-their-own-fans/) for these practices. It was ruled that the reseller - even though controlled by the Cubs and having a President who was a VP with the team AND some of the tickets sold being printed inside the Cubs offices - was an independent organization and therefore there was no collusion. Right. ---
**Author:** ![Bijou\_Drains](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bijou_drains/32/2814_2.png) [@Bijou\_Drains](https://boards.straightdope.com/u/Bijou_Drains)\ **Post date:** [January 30, 2016, 6:08pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/28 "2016-01-30T18:08:36Z")
There are bands/artists now that sell VIP ticket packages that are way above the normal ticket prices. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [January 31, 2016, 1:38am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/29 "2016-01-31T01:38:15Z")
Smart! ---
**Author:** ![MikeG](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mikeg/32/4329_2.png) [@MikeG](https://boards.straightdope.com/u/MikeG)\ **Post date:** [January 31, 2016, 1:54am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/30 "2016-01-31T01:54:21Z")
> [@Jonathan\_Chance](#): > > Indeed. A prime example of this is the case of the Chicago Cubs in 2002. > > The Cubs were discovered to be owners of a ticket reseller - scalper, in the vernacular - to which they would sell tickets at face value preferentially. The reselling organization would then mark the tickets up to whatever the market would bear. > > Checking, it seems the Cubs [won the case brought against them](http://sportsmockery.com/2015/07/chicago-cubs-get-caught-scalping-tickets-to-their-own-fans/) for these practices. It was ruled that the reseller - even though controlled by the Cubs and having a President who was a VP with the team AND some of the tickets sold being printed inside the Cubs offices - was an independent organization and therefore there was no collusion. > > Right. I never went to another Cubs game after that story came out. Even this past year with the WS hype, no way will I ever give them another cent. And I used to WORK for them! ---
**Author:** ![Alley\_Dweller](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/alley_dweller/32/430_2.png) [@Alley\_Dweller](https://boards.straightdope.com/u/Alley_Dweller)\ **Post date:** [January 31, 2016, 2:08am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/31 "2016-01-31T02:08:52Z")
> [@Bijou\_Drains](#): > > There are bands/artists now that sell VIP ticket packages that are way above the normal ticket prices. There is a large outdoor music festival that is held here every year. In previous years, they sold VIP tickets that gave access to reserved preferred viewing areas, free beers, a lounge, and other stuff. In 2015, people bought the VIP passes expecting the same amenities. They complained that the VIP viewing areas were out-of-sight of the stages, the lounge was just an open unheated area (and the weather was cold and rainy), but they got the free beer. In 2015, they started selling some sort of super-VIP pass that got all the perks that previous years’ VIP passes got, but for a lot more money. Most of the VIPs were pretty angry. ---
**Author:** ![Rhythmdvl](https://avatars.discourse-cdn.com/v4/letter/r/85f322/32.png) [@Rhythmdvl](https://boards.straightdope.com/u/Rhythmdvl)\ **Post date:** [January 31, 2016, 2:21am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/32 "2016-01-31T02:21:06Z")
**PSA** CashOrTrade.org.!!! There’s this ‘thing’ in the Deadhead/Phish/Etc. community about music. Most bands allow you to tape (and often make it easier by selling taper tickets), conditioned only that you don’t sell the recordings, but give them away. It’s well known that many fans give away extra tickets at showtime (to ‘miracle’ someone). That vibe led to the set up of [CashOrTrade.org](http://CashOrTrade.org). It’s reputation-based, which keeps scammers down a bit (nothing’s perfect), with the idea that it’s fans buying and selling to each other—at face value. You can trade, too (e.g. I have an extra Saturday if you have a Sunday). It’s really come through for us, and encourage any of you who find yourself sold out of a show to check it out just in case. It’s primarily jambands and bluegrass, but if you look at their [performers page](http://cashortrade.org/performers?allperformers=1)it’s pretty diverse (and growing). ---
**Author:** ![Count\_Blucher](https://avatars.discourse-cdn.com/v4/letter/c/c5a1d2/32.png) [@Count\_Blucher](https://boards.straightdope.com/u/Count_Blucher)\ **Post date:** [January 31, 2016, 2:24am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/33 "2016-01-31T02:24:16Z")
> [@Diceman](#): > > It wouldn’t surpise me if the venue operators _are_ the resellers in many cases. Ultimately, this would be a scam to avoid giving the act its fair share of the profits. 75% of $25 tickets is a much smaller payment than 75% of $150 tickets. I have LONG suspected that this was the case (and that many of these scams are family operated. ie- nephew jerk-weed sells the NY shows out of a cheesey store front in Scotch Plains while cousin dip-shit sells the Jersey shows from a run-down loft on the middle west side.) The ONLY WAY I ever see this corruption cleared out is for the artists to have Total Control over ticket sales through their own companies. Its one way to level the playing field between the “I’ve seen Bruce Springteen 500 Times!” crowd and those who still haven’t managed to see him Once. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [January 31, 2016, 2:25am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/34 "2016-01-31T02:25:35Z")
This suggests another way promoters could recoup more of the arbitrage that is lost to scalpers without taking as much of a PR hit–either at the beginning, or later if they are discovered owning a reseller. When tickets are put on sale, have the majority of them (60% to 80% sold as is normal now. But the best seats closest to the stage could be sold in the Dutch auction manner I proposed, unless that would run afoul of laws requiring all seats in the same row be sold at the same price. This way, people couldn’t complain that they priced out ordinary folks right from the beginning. ---
**Author:** ![Digital\_is\_the\_new\_Analog](https://avatars.discourse-cdn.com/v4/letter/d/a88e4f/32.png) [@Digital\_is\_the\_new\_Analog](https://boards.straightdope.com/u/Digital_is_the_new_Analog)\ **Post date:** [January 31, 2016, 3:56am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/35 "2016-01-31T03:56:31Z")
The owner of the Miami Dolphins appears to be doing just this. [He’s an (apparently minor) investor in a company that resells Dolphins tickets](http://www.wsj.com/articles/why-ticket-brokers-hate-the-miami-dolphins-1443723602): > [@](#): > > In September, the Dolphins went public with a plan to significantly curtail the number of tickets it sells to independent brokers. The goal, the team said, was to make sure fewer tickets ended up being sold to fans of visiting teams. But according to one broker who was cut off, the Dolphins gave a big chunk of these tickets to one firm in particular: Atlanta-based PrimeSport Inc., which was acquired in February by an investor group that includes Dolphins owner Stephen Ross ---
**Author:** ![Urbanredneck](https://avatars.discourse-cdn.com/v4/letter/u/ea5d25/32.png) [@Urbanredneck](https://boards.straightdope.com/u/Urbanredneck)\ **Post date:** [January 31, 2016, 5:40am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/36 "2016-01-31T05:40:09Z")
They could just require people to go to ticket venues in person and but physical tickets and then only allow no more than 4 tickets per person. It just seems that alot of this is due to being able to order online. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [January 31, 2016, 5:52am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/37 "2016-01-31T05:52:39Z")
And selling them at what is apparently an artificially low price, as though it is a government run grocery store in Venezuela. ---
**Author:** ![mhendo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mhendo/32/3159_2.png) [@mhendo](https://boards.straightdope.com/u/mhendo)\ **Post date:** [January 31, 2016, 7:59am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/38 "2016-01-31T07:59:33Z")
> [@Xema](#): > > I’ve heard the following “anti-scalper” scheme suggested: > > When you order and pay for a ticket, you must supply ID; admission will be granted only to the person who presents the matching ID. If you can’t attend (e.g. you got sick) you can relinquish the ticket and receive a refund if it re-sells. Bruce Springsteen in playing some shows in LA in March. Buying tickets for his concert through Ticketmaster has a system very much like this. They call it Ticketmaster Credit Card Entry. I assume he’s done this for all shows on his River tour. For this concert, you are limited to four tickets per person, and the person who buys the tickets has to turn up at the venue, on the night of the performance, with the credit card used for the purchase as well as a matching government-issued ID. And you can’t just use the credit card and ID to pick up the tickets, and then hand them off to someone else. There are no actual tickets to pick up at the box office. You actually have to bring the credit card and the government ID to the door of the venue, and walk into the venue with the other people for whom you bought tickets. Basically, if you bought four tickets, all four of you have to walk in together: the actual purchaser, plus three. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [January 31, 2016, 10:19am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/39 "2016-01-31T10:19:54Z")
> [@mhendo](#): > > For this concert, you are limited to four tickets per person, and the person who buys the tickets has to turn up at the venue, on the night of the performance, with the credit card used for the purchase as well as a matching government-issued ID. > > And you can’t just use the credit card and ID to pick up the tickets, and then hand them off to someone else. There are no actual tickets to pick up at the box office. You actually have to bring the credit card and the government ID to the door of the venue, and walk into the venue with the other people for whom you bought tickets. > > Basically, if you bought four tickets, all four of you have to walk in together: the actual purchaser, plus three. There are problems with such a system. What if you are legitimately buying tickets for somebody else? My mother, who lives in New York, buys concert tickets as gifts for her granddaughter, who lives in Texas. My mother has no problem buying the ticket online with a credit card but she’s not going to show up at the venue to pick them up. ---
**Author:** ![Schnitte](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/schnitte/32/9033_2.png) [@Schnitte](https://boards.straightdope.com/u/Schnitte)\ **Post date:** [January 31, 2016, 12:26pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/40 "2016-01-31T12:26:54Z")
> [@RickJay](#): > > 1. Price discrimination is hard. You describe a sort of ideal price discrimination scenario, but realistically if a team, venue, or concert hall tried something like that it would take people nine seconds to figure the system out. > > 2. Price discrimination is terrible, terrible PR. Boosting people for a thousand dollars to see a show is something you EXPECT of a scalper; you know the scope there. If the venue did that, though, it would reflect poorly on the artist/team/whatever and the venue. I don’t see how the scheme that the OP describes - with the orimary ticket vendors pricing tickets at the market rate to begin with - can be called price discrimination. To me, price discrimination is the practice of charging different customers of the same product different prices, depending on the willingness of that individual customer to pay. That is not what the OP proposes; rather, the proposal is to uniformly price tickets at (or close to) the price which basic economics would predict to be the market outcome to begin with, across all purchasers. [Previous page](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562.md?page=1) [Next page](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562.md?page=3)