NY Attorney General charges widespread abuses in ticketing industry

As many as 46% of seats for many popular concerts in New York are not offered to the general public.

A three-year investigation of the online ticketing market has seen New York Attorney General Eric T. Schneiderman claimthere are widespread abuses in ticketing industry. The report, titled Why Can’t New Yorkers Get Tickets?, says that ticket brokers are using technology to illegally profit at the expense of ordinary music and sports fans.

According to the 44-page report, 38% is set aside for pre-sales (which are offered to various credit card holders or fan club members), and 16% are “industry”, for sponsors, artist friends, record companies and media.

Pre-sales can be as high as 70% of tickets, which happened at Coldplay, Justin Timberlake, Jay-Z and Fleetwood Mac shows.

“Ticketing is a fixed game,” Schneiderman declared. “My office will continue to crack down on those who break our laws, prey on ordinary consumers and deny New Yorkers affordable access to the concerts and sporting events they love. This investigation is just the beginning of our efforts to create a level playing field in the ticket industry.”

Last month, Schneiderman pressurised a number of online ticket platforms, including StubHub, to pull Bruce Springsteen tickets that brokers were speculatively selling for up to US$5000 before they went on the market.

New York dropped some of its tough laws against in 2007 as consumers turned more to online buying. But the Schneiderman report says that the online ticketing market has developed in ways that work against consumers and are often illegal.

The most popular of these illegal practises are “bots”, where computer programs allow people to elude “I am not a robot” security measures on sites as Ticketmaster and grab a large number of seats for resale of up to 1000%.

One bot has drop-checker software that constantly monitors ticketing sites to figure out when tickets are being released. The other waits for when the tickets are released and conducts lots of simultaneous searches. When tickets are put in “reserve status”, to allow ticket buyers time to put in their credit card information, the scalpers can move in and pick the best ones.

Last year 15,087 tickets were bought by two ticket bots for 20 concerts across America by U2, with one scalper buying 1012 tickets to their show at Madison Square Gardens in New York City in less than a minute.

Another illegality is resale brokers operating without licenses. Two in New York City have recently been fined between $80,000 and $65,000.

Why Can’t New Yorkers Get Tickets? makes some recommendations to regulate the ticketing industry. Promoters need to be more transparent about how many tickets are available to the public. There should be a cap on mark-ups charged on secondary markets. Brokers must use their New York license numbers when they use resale platforms.

The sector must investigate new technological ways to prevent ticket bots. The law should be changed to make legal paperless tickets, whereby the person who bought the ticket has to show up at the venue and pick it with an ID.

Schneiderman summed up, “Whereas in many areas of the economy the arrival of the Internet and online sales has yielded lower prices and greater transparency, event ticketing is the great exception.”