Ticket turf war heats up in Sacramento

by Melody Gutierrez, Sacramento Bee

Two ticket-selling giants have brought an industry turf war to Sacramento, with both sides claiming to represent fans’ rights as they compete over billions in proceeds from concerts and sporting events.

Ticketmaster has added restrictions on the reselling of tickets to curb scalping, measures the company says it uses at the request of artists, promoters and sports teams concerned with price gouging and scams.

StubHub, an online subsidiary of eBay where people buy and sell tickets, said the non-transferable tickets that Ticketmaster uses unfairly penalize buyers. StubHub teamed with consumer rights advocates such as the National Consumers League and Consumer Action to argue that once tickets are purchased, people should be free to do with them as they please.

"If I pay for a ticket, shouldn’t I be able to resell it?" asked Jon Potter, president of StubHub’s advocacy group Fan Freedom Project.

The question of property rights is being raised in legislatures across the country as both Ticketmaster and StubHub lobby for bills to promote their causes and pocketbooks in states such as Texas, Florida and Minnesota.

In Tennessee, a bill pegged "The Fairness in Ticketing Act," backed by Ticketmaster, called for more controls on the secondary ticket market, including requiring ticket brokers to register with the state Department of Commerce and Insurance and disclose face value costs. The bill died last week.

"If people really want what’s best for fans, they would take a look at what was proposed in Tennessee," said Ticketmaster spokeswoman Jacqueline Peterson. "Those are the types of meaningful reforms needed."

A bill proposing to prevent most restrictions on California’s resale market will be heard in Sacramento next week.

Sacramento Democratic Assemblyman Richard Pan authored a bill backed by StubHub’s advocacy group Fan Freedom Project that would make it illegal for companies to prohibit fans from reselling event tickets.

Pan said Assembly Bill 329 ensures the fundamental rights of ticket-holders. The issue surfaces when events use paperless tickets that are non-transferable. Paperless tickets require the purchaser to show their ID and the credit card used for payment to enter a venue. Pan said this effectively prevents ticket-holders from giving them as gifts, donating them to charities or selling them when they can’t attend an event.

"When people buy their ticket, they own their ticket," Pan said. "I strongly believe that ticket-holders should be able to own their tickets and be able to have the rights attached to that."

Pan’s legislation would ban the type of scalping that makes it difficult for the average fan to buy a ticket by prohibiting robotic ticket-buying software. The "bots" flood online box offices with thousands of simultaneous purchases purporting to be different buyers in order to resell tickets at higher prices on other sites.

"The general consumer is almost always the last in line," said Dave Mowery, a Kings season ticket-holder and regular concert-goer who lives in Natomas. "It’s a disappointing system that has evolved over time."

Michael Marion, the general manager of Verizon Arena in North Little Rock, Ark., said the customer is who he has in mind when he uses paperless tickets for a third of his 13,000 concert seats. Marion is president of Ticketmaster’s advocacy group Fans First Coalition, which launched in 2011, shortly after StubHub’s Fan Freedom group.

Fans First’s membership includes big names in music, such as Maroon 5, and venues, such as Sleep Train Amphitheatre in Wheatland.

"We tell people up front it’s a nontransferable ticket," Marion said. "They know they are taking a risk."

Marion said he reserves the best seats at Verizon Arena for paperless ticketing, because scalpers have a harder time selling the upper deck for a profit. He said it makes business sense for him to have concert-goers pay face value, because that means they are more likely to attend more shows.

"It’s cheaper, and fans can go to more shows, and that helps me out because my business is built on people coming in the door," he said.

In some cases, paperless tickets can be sold on Ticketmaster’s TicketExchange up until the night before the event, but sellers can’t predetermine who tickets are sold to. And Ticketmaster collects a fee from the original sale as well as the second purchase of the tickets.

Brandon Stone, 30, said he bought paperless tickets for a Metallica show in Oakland a few years ago and liked the fact that he was able to get them at face value. However, restrictive tickets would make it difficult for Stone, a San Francisco 49ers season ticket- holder, to sell his seats for games he can’t attend.

Stone said he uses StubHub and Ticketmaster’s NFL Ticket Exchange to sell one high-profile game a year to pay for his playoff tickets.

"I buy more tickets than I sell, so I think it’s a great idea to limit the abilities of scalpers," said Stone, who lives in South San Francisco. "I know very well in my past purchasing that I will be buying not from an individual who wants to get rid of tickets, but from a professional scalper. As a buyer, that’s not great for me."

Artists argue that it isn’t good for them either as they watch third-party vendors profit from their fans.

"I’m very much against the secondary ticket market," Mick Jagger of the Rolling Stones said in a Chicago Tribune story last week. "I don’t know anyone who isn’t. … Each state should make secondary reselling illegal."

Dean Nelson of Rancho Cordova disagreed, saying efforts to restrict the resale market will make it difficult for consumers, who often buy tickets far in advance of games and concerts. Nelson, 60, is a Raiders season ticket-holder who, up until this past season, had never missed a home game since 1995.

Nelson said he needed to sell his two seats for the Sept. 23 game against the Pittsburgh Steelers. He used Ticketmaster’s NFL Ticket Exchange, which is listed as the only resale option on the Raiders’ website. NFL Ticket Exchange charges a 10 percent commission.

"It’s a huge industry, and I can see where they want to keep it in check," Nelson said. "But it raises the question of what makes sporting events different than other commodities? … How I manage my tickets should be up to me."

Jared Bolls of Livermore, who owns Raiders season passes and regularly buys concert tickets, said he sees both sides.

"If I have two Raiders tickets, that’s $150," said Bolls, 30. "Those are my tickets and I should be able to do what I want. But, I agree that when I want to buy concert tickets, people buy 25 tickets and they sell out quickly. It drives up the price."