Ticket scalping refers to the resale of tickets, often at prices well above face value. This practice has become increasingly common, especially with major events like concerts, shows, and sports games. Many scalpers use large online marketplaces like Ticketmaster to resell tickets, often utilizing special tools and bots to buy up tickets in bulk. This has caused frustration among fans who get shut out of buying tickets at face value and have to pay inflated secondary market prices instead.
Scalping is legal due to a few key factors:
Lack of Anti-Scalping Laws
There are currently no federal laws in the United States prohibiting ticket scalping. A few states have anti-scalping laws, but they are limited in scope. As such, buying tickets with the intent to resell is not illegal on a broad scale. Ticketmaster is within its rights to allow and facilitate ticket resale on its platform.
First Sale Doctrine
The first sale doctrine is a legal concept that allows the purchaser of a legal good to then resell it as they wish. When you buy a ticket, you own it outright and can choose what to do with it, including reselling it. Ticketmaster is not violating any laws by enabling you to resell your ticket on their marketplace.
Lack of Price Controls
There are no price control laws governing ticket resale. Sellers can charge whatever high prices the market will bear. As long as buyers consent to the price, it’s generally legal no matter how high the markup.
The Pros and Cons of Ticket Scalping
Allowing ticket scalping comes with both upsides and downsides. Here are some of the key pros and cons:
Pros
- Provides a secondary market for tickets
- Allows price discovery based on supply and demand
- Gives buyers more options to shop for tickets
- Enables an income stream for those reselling tickets
Cons
- Can make tickets unaffordable for average fans
- Rewards large scalping operations over individuals
- Creates avenues for ticket scams and fraud
- Contributes to rapid sellouts as scalpers gobble up inventory
There are good-faith arguments on both sides of the issue when it comes to allowing a secondary ticket market. Where one sees desirable market forces at play, others see manipulation and unfair practices.
Why Ticketmaster Allows and Facilitates Scalping
As the largest ticket marketplace, Ticketmaster has faced its fair share of criticism for enabling scalpers. However, there are some clear business reasons why Ticketmaster not only allows reselling, but provides tools to facilitate it:
Buyer Demand
There is strong buyer demand for secondary market tickets, even at inflated prices. Sports fans, concert-goers, and other event attendees often value convenient access to tickets over anything else. With its massive buyer base, Ticketmaster is in prime position to collect fees on second-hand ticket transactions.
Seller Demand
Just as there is buyer demand, many sellers want an easy way to repost their tickets. Ticketmaster offers a seamless selling platform with millions of potential buyers. This attracts large volumes of third-party tickets.
Fees & Commissions
As a marketplace, Ticketmaster generates revenue by collecting fees from both ticket buyers and sellers. More tickets changing hands means more fees collected. Scalper-driven volume is an easy way to drive fee-based returns.
Data Collection
By monitoring ticket resale patterns, Ticketmaster can gain incredibly valuable pricing data on high-demand events. This data can inform optimal pricing strategies for maximizing profits on primary ticket sales.
Key Scalping Practices on Ticketmaster
Ticket scalpers rely on a few key strategies to secure large volumes of tickets on Ticketmaster:
Bots
Scalpers often use ticket-buying bots, programmed to purchase tickets the moment they go on sale. This lets them buy in bulk before regular fans can get through online queues. The use of bots is officially prohibited by Ticketmaster, but still runs rampant.
Multiple Accounts
Those reselling tickets will often set up dozens or even hundreds of Ticketmaster accounts. This allows them to get around per-account ticket purchasing limits.
Season Tickets
For recurring events like sports seasons, scalpers will buy entire seasons worth of tickets. Popular games can then be resold at a huge markup.
Pre-Sale Access
Scalpers pay to get pre-sale ticket passcodes for fan clubs, credit cards, etc. This gives them early access before the general public on-sale.
Changing Names
After buying tickets, scalpers can change the name printed on them to say “Resale” or something generic. This makes them more marketable to buyers on resale sites.
Efforts to Curb Scalping
Both Ticketmaster and lawmakers have explored various options for limiting how much scalpers can take over the ticket market:
Captchas & Queuing
Using CAPTCHA tests and online waiting rooms makes it harder for bots to rapidly buy tickets. However, these have limited effectiveness.
Ticket Limits
Setting stricter limits on how many tickets one person can buy per event is perhaps the easiest way to curb scalpers. But limits can also negatively impact regular fans trying to buy tickets for groups.
Increased Primary Prices
Some teams and artists have experimented with pricing tickets closer to their market value from the start. This cuts down on profit margins for scalpers, but also prices out more fans.
Cancellation Policies
Strict no-refund policies for canceled tickets make it riskier for scalpers to speculate on tickets. But these policies also harm fans’ ability to easily transfer tickets.
Anti-Scalping Laws
A few states like New York and Connecticut have passed stricter laws limiting for-profit ticket resale. But federal legislation is unlikely given resistance from marketplaces like Ticketmaster.
The Future of Scalping
Though divisive, scalping will likely remain an entrenched part of the ticket marketplace as long as the following conditions hold true:
- High demand for limited event tickets
- No federal prohibitions on ticket resale
- Stable secondary buyer demand despite high prices
- Ample incentives for marketplaces like Ticketmaster to enable scalpers
Without dramatic shifts in fan attitudes, lawmaker intervention, or proactive measures by ticketing platforms, scalping will persist as a way for opportunistic middlemen to profit off live events.
Though unpopular with fans, scalping reflects broader free market principles around supply, demand, and pricing. As such, meaningful changes will need to address systematic forces, rather than purely focusing on curtailing individuals. The debate continues around what reforms, if any, are appropriate without unduly restricting legal trade.
Conclusion
Ticket scalping persists on Ticketmaster and other platforms due to its legal status, buyer demand, and incentives for marketplaces to facilitate resales. Though controversial, scalping is seen by economists as a way for markets to set efficient prices based on demand. Attempts to curb scalping via technical measures or consumer limits have fallen short. Some argue for stronger anti-scalping laws, while others question excessive regulation of legal resale markets. Nonetheless, expect scalping to remain a presence in the ticket industry unless fundamental conditions change around supply, demand, and consumer attitudes.
