[Infowarrior] - OpEd: Who Owns My Ticket?

[Richard Forno]

Who Owns My Ticket?

By ALBERT A. FOER

Washington

http://www.nytimes.com/2012/01/20/opinion/who-owns-my-ticket.html?_r=1&pagewanted=print

AT this moment, all over the United States, consumers are buying tickets to games, concerts and other live events under the impression that they have the right to give away, donate or resell the tickets they purchase. They assume that they can do so whenever and with whomever they wish and (as long as they don’t violate the few remaining laws against scalping) at whatever price they choose.

But those consumers may be mistaken. In recent years ticket sellers, along with promoters, producers, artists and sports teams, have increasingly taken a new approach to selling tickets. This approach, marketed in the name of innovation, convenience and protecting purchasers, restricts those fundamental freedoms long rightly taken for granted.

The practice is so-called paperless ticketing: tickets are purchased by credit card, and to gain entry to an event, the buyer must present the same credit card and a photo ID. You cannot readily give your paperless concert ticket to a friend or sell it to a colleague or buy one for your grandchild to use. In no other format — traditional paper ticket, printable e-ticket or digital ticket delivered on a smartphone — are live-event tickets subject to such transfer restraints, and no product other than airline tickets (for which there is a security rationale) involves such restrictions.

Ticketmaster, the dominant seller of live-event tickets, and to a lesser extent its much smaller competitor Veritix, both engage in this practice. Ticketmaster says its restrictions on the resale and “gifting” of its paperless tickets act as safeguards against various practices: scalping; the bulk purchasing of tickets by automated software bots; and the use of counterfeit, stolen or lost tickets.

But in reality, the restrictions represent an effort to control the secondary-ticketing market and stifle competition from independent resellers and resale marketplaces like StubHub, where tickets are often sold for less than face value. (The American Antitrust Institute, of which I am president, received a modest contribution, in the form of sponsorship of a conference last year, from an advocacy group financed in part by StubHub.) Paperless tickets bought through Ticketmaster may be resold, for example, only through its own resale Web site, which often prohibits sales below face value, sets maximum sale prices and charges a fee for transfers.        

The scope of the problem — how many fans are affected, how much money is involved — is difficult to quantify. Paperless tickets are estimated to represent only about 1 percent of the well over 100 million live-event tickets sold each year. But in the absence of strong consumer resistance, they are likely to become increasingly common.

This week, the American Antitrust Institute is releasing a report on the paperless-ticket market by James D. Hurwitz, an institute fellow and former policy analyst at the Federal Trade Commission. The conclusion: restrictive paperless-ticket practices depart from bedrock market principles by unjustifiably limiting consumer choice and suppressing free competition. They also might violate federal and state antitrust and consumer-protection laws. And they may warrant legislation to protect the market and consumers.

As it happens, a number of states are weighing ticket reforms. In 2010, New York became the first state to pass legislation to protect the right of consumers to transfer tickets to others as they see fit. Similar legislation has been introduced in Minnesota, Massachusetts, Connecticut, North Carolina, Florida and New Jersey.       

We urge reform of these ticketing practices. Specifically, we call on the Federal Trade Commission, along with state attorneys general, consumer-protection agencies and legislators, to investigate the growing threat of restrictive paperless-ticketing practices for live events. Perhaps the threat of an investigation will spur the industry to reform itself.

These practices undermine a free, fair, informed and competitive market. Consumers should be enabled to transact with others.

Albert A. Foer, a lawyer formerly with the Federal Trade Commission, is president of the American Antitrust Institute.


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Just because i'm near the punchbowl doesn't mean I'm also drinking from it.