Posted by: nickgerlich | October 30, 2007

That’s The Ticket

Everyone is in favor of free markets. Until it affects them, that is.

It is easy to pay lip service to the lofty ideal of an economic utopia whereby all prices were deteremined strictly by supply and demand, and no other artificial forces. No intervention. No guiding hand. Pure unfettered capitalism.

But just try to talk about the price of concert and sports tickets, and you’re likely to get a different argument.

Hannah MontanaCase in point: Child star Hannah Montana (nee Miley Cyrus) is slated for a tour with 54 concerts. Sure, most attendees will be pre-pubescent girls, with parents in tow. But when tickets went on sale recently, all of the shows were sell-outs in but a matter of minutes.

And it was only a matter of a few more minutes before tickets started showing up on eBay and ticket brokerage sites.

In other words, ticket scalping is alive and well in America. And all the little girls who want to see Hannah Montana are going to have to double or triple up on household chores in order to get Mom and Dad to cough up the bucks.

The District Attorneys in several states were alarmed by this, and launched investigations. But as MSNBC.com reports, the Fed is steering clear of this one. Tickets with face values between $25 and $65 are now being offered for several hundreds of dollars, with seats near the stage in LA going for a mind-boggling $2427. Each.

Mom and Dad might consider sitting that one out and waiting on the steps outside the arena.

The Fed says that, basically, as long as demand exceeds supply, then ticket scalpers will have their day. Ticket brokers (as they prefer to be called) are really speculators, hoping for a return on their investment. Just like anyone investing in stocks or bonds. No different, so no big deal.

But people start getting antsy when they realize that ticket brokers are scooping up their products by means of hiring dozens of fast-clicking internet operators to buy the tickets at the precise moment tickets go on sale. In the old days, you either had to camp out all night, or pay a poor college student to do it for you, in hopes of getting tickets that could be resold. But thanks to technology and broadband, it is now rather straightforward for someone in Gainesville FL to buy tickets for events in San Francisco…and Seattle, Los Angeles, Chicago, and New York.

I experienced this frustration myself earlier this autumn while trying to buy tickets for Trans Siberian Orchestra. I was camped out online waiting for the 10am whistle, mouse in one hand and Visa in the other. In spite of my fast clicking (and prior surveillance the day before to understand how the site operated), I was only able to get 7th row seats.

I’m not complaining. Much. Because I did see TSO tickets on eBay later that day for concerts all over the country, and they were often in the first two rows, with asking prices of $200 or more.

Now assuming these ticket brokers don’t have inside connections to always get the absolute best seats in the house, I have to agree with the Fed on this one. It is a marketplace out there, and if we’re all using the same internet to access it, then market forces will prevail. And as long as people are willing to pay lots of good money to see TSO, Jimmy Buffett, or even the bright-eyed daughter of a washed-up one hit wonder country music star (Hannah Montana is the daughter of Billy Ray Cyrus), then prices on the after-market will continue to rise.

I’ve just got to get a little faster with my mouse.

Dr “Why Didn’t I Think Of This” Gerlich

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