How Much Would You Bid On eBay To Explain Market Economics To Sundance Festival Organizers
from the buy-it-now dept
A couple of years ago, Live 8 organizer Bob Geldof got into a war of words with eBay over the unauthorized exchange of concert tickets on the site. Geldof insisted that eBay, by allowing people to sell tickets to each other, was profiteering on the backs of the poor (even though the site said it would donate all proceeds from those particular auctions). Of course, Geldof's argument made no sense, and simply revealed how little Geldof understood about the market system. The exchange of tickets on eBay isn't hurting anyone, least of all those benefiting from the Live 8 concert. And apart from Geldof's dubious philosophical complaints, neither Geldof nor the Live 8 organization have any business telling people what to do with their legally acquired private property. Unfortunately, Geldof wasn't the last try one to make this argument. The organizers of the Sundance Film Festival are threatening to deactivate any screening tickets sold over eBay. It's not clear whether they actually will (or can) carry out with the threat, but beyond that, it's hard to see what Sundance's problem is with this activity. The festival isn't losing any money from this, and the fact that there are people willing to pay over $300 for a ticket to the newest Keri Russell movie means that the audience will actually represent hardcore fans. At least Geldof had the pretense of wanting to benefit the greater good with his complaint.
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I wonder how they would go about doing that?
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The Problem with Licencing
Geldof/Suncance's right (at least in the United States) to effectively license-- put restrictions on -- resales of the right to attend his concert as well as a host of other restrictions on the event.
I would have preferred that this post be a diatribe on the evils of the current software model, and your right to freely resell stuff you buy, without the manufacturer having the ability to turn it off if they feel you aren't compliant with the license agreement (exactly analogous to the Sundance people).
I agree that the economy would work better ift tickets (and software) were treated as property rather than a license agreement.
However, in the narrower case, ebay does benefit from selling high-profile items at zero commisson. It benefits from good will, advertising, public awareness (e.g. this site's posts) and by squeezing competition who don't get these same benefits.
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@I need help
Furthermore the problem with neo liberal economics lies within the "morality sphere". It tries to assume that supply and demand have something to do with morality or human psychology, while it's just a mathematical equilibrium. Take a look at this techdirt article in which they say this "people willing to pay over $300 for a ticket to the newest Keri Russell movie means that the audience will actually represent hardcore fans". Now this is just economic pseudo science, since it tries to add a human psychological dimension to market prices. The only thing it just says is that one persons purchasing power is enough combined with his intrest in the movies to pay so much for it (rich "fan" is a better word in this case than hardcore fan). There might be different ways to get the audience full of "hardcore fans", besides ticket scalping.
To give another example: neo liberal fundamentalists like techdirt wouldn't have a problem with touts buying all Pink Floyd tickets for one gig and creating an artificial scarcity and then only selling a few tickets to the worlds richest men. So Pink Floyd would perform for like an audience of 20 in an arena that could hold 20 000 for instance. The wrong assumption neo liberal fundamentalists make is that they should force the market principle on everything ( because it's good in their eyes and how can anyone resist artificial freedom), cause not everyone wants to do it the market way. Especially not the cultural sector.
For what it's worth in Belgium tickets usually get printed with your name on, so you have to show your ID when you enter the venue. If you can't go and want to sell your ticket you can via the ticket agency. Yes this means that demand for tickets is sometimes quite high, but everyone has a chance to get tickets instead of only 40 year old white middle class males. i know it's difficult for people to accept that an equal chance for people is a good thing, when they have money and think that money should make'm better than other people.
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Re: @I need help
Please refrain from making (bad) assumptions about us. We are hardly "right wing" or "neo liberal" or whatever you call us. We do not have faith that the market system solves "all." It's funny that sometimes we're called right wing free market ideologues and other times we're called communists (today alone!). It's tough to keep up with which side of the political spectrum we're supposed to be representing.
So, no, we do not believe the free market solves all -- but we do believe it's very often the most efficient means of distribution for a product. If you're not going to use it, then there needs to at least be significant explanations for why there's market failure that would require not using such principles.
Your argument appears to be that the market failure is in the idea that poorer people who are big fans won't get to see the content as well. I don't find that compelling. This isn't charity, it's a business. If it is charity then there are other issues to take into account -- and if the people who receive the tickets as charity find that they'd be better off with $300 than a free movie, what's the issue?
Furthermore the problem with neo liberal economics lies within the "morality sphere". It tries to assume that supply and demand have something to do with morality or human psychology, while it's just a mathematical equilibrium.
Again with the bad assumptions. Economics and morality are two separate things and should be viewed as such.
neo liberal fundamentalists like techdirt wouldn't have a problem with touts buying all Pink Floyd tickets for one gig and creating an artificial scarcity and then only selling a few tickets to the worlds richest men. So Pink Floyd would perform for like an audience of 20 in an arena that could hold 20 000 for instance.
Well, we're still not neo liberal fundamentalists, and there are serious problems with the situation you describe. First of all, the free market (which you so roundly dislike), would be unlikely to allow this to happen. You assume that the "touts" (is that like a scalper?) can corner the market, at which point the market is anything but free. So, you're no longer discussing a free market, but a controlled one, which is something we find to be inefficient. So, what's the problem with the free market again?
i know it's difficult for people to accept that an equal chance for people is a good thing, when they have money and think that money should make'm better than other people.
No. You seem to be missing the point of our discussion. Equal chance is absolutely a good thing, and a cornerstone of the free market. But, equal chance doesn't mean that you pay according to your ability, because that leads to much greater unfairness and inequality.
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I_NEED_HELP wrote:
>The problem with selling tickets on ebay is that they are bought by
>touts rather than genuine fans. They are a huge problem for for genuine
>fans due to syndicates of touts buying up massive amounts of tickets to
>resale at a huge profit.
I don't understand this. What are the touts doing with the tickets, if not reselling them to "genuine fans"? Or do you consider fans who buy tickets from touts to be "non-genuine"?
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Re:
Of course they are genuine, that is the problem, they are so genuine that the touts know they will pay well over the odds for the tickets they are selling.
My point is that if you stop letting in "touted tickets" the genuine fans won't buy them anymore. If there is no market place for these tickets then the touts won't buy them in the first place, leaving the genuine fans to the tickets, if there are more fans than tickets well that is just a fact of life, but at least the tickets aren't being sold to people who have no intention of going to the gig and just want to make a quick buck
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People selling tickets aren't the sharpest tools i
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Here is simple fact, touts buy tickets they do not plan to use but rather to resell at higher price on to people who will use them, because touts buy so many the final customers cannot get tickets from the official source at official price, essentially creating an artificial scarcity which allows the touts to make their profits.
Eliminate touts and a lot more tickets (I have heard of some events where they estimate 50% of tickets went to touts) become available to genuine customers at the official price
And before anyone says "you have same chance to get tickets as touts", sorry that is not the case when vs the professional, they know every trick in the book and for really "hot" events they have teams of buyers getting the tickets for them
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Ticket Pricing
A fan with little money is automatically a "real" fan, and a fan with money a "fake" fan.
It's just the same old "Get Even With 'Em-ism". Achievers should be punished for... well... for making underachievers appear underachieving!
Market pricing the tickets is the solution, either by the venue or a secondary source. Folks who underachieve will be under-represented at Pink Floyd concerts, Four Seasons hotels, Ferrari dealers, and Virgin Space's initial moon landings. Why is that wrong?
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The Have's and the Have Not's
Put a little different people seem to think that the only FAIR market is one in which everyone has a chance, and they don't understand that a free market does indeed give everyone a chance. The problem is that there's a limited supply of goods.
But there are those that think just because some people are willing to pay more money for something than another person can afford it's wrong, or in some way unfair. The person who wasn't able to get the good/service is angry and claims that the rich are selfish, greedy, etc. However, what does that make the person that wants the good/service but it angry because they didn't or can't get it for the price they want? Does it not make them greedy as well? Selfish as well? Of course it does.
The great thing about a free market is that no one gets hurt as long as you allow people to freely trade with one another. If some ticket scalper is trying to sell a ticket for $1,000, but no one wants to purchase it, they'll lose money or have to lower their price until someone is willing to pay for it.
Of course one thing to remember, too, is that if you're a concert promoter you have the right to sell your tickets to your event with restrictions on them (such as not allowing the tickets to be resold). When people purchase the tickets they are aware of the rules by which they are bound, they agreed to be bound by those rules when purchasing the tickets, so if the ticket promoter sees those rules broken by someone they have legal rights to sue, or seek some damages of some kind. If you don't like those rules...don't buy tickets from that promoter...don't buy the goods/services...
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The only solution
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Re:
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fair / unfair / rare things
That's NOT the same thing. You're providing a service and making a profit while doing so. OTOH scalpers are taking advantage of technology to increase scarcity of tickets, to force a number of buyers their way.
Buyers don't realise they're just reinforcing their own rippoff when tickets above their original price, otherwise we could boycott scalped tickets and leave the scalpers out of pocket.
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Flames - Off topic
Stan: I don't know if you intended to sound like an arrogant donkey, but you succeeded.
If you did intend to, you should seek out medical attention. Mania is a true mental disorder; but it has symptoms that are misleading. IE: success, wealth, disdain for those who have less motivation.
The root of this issue seemed is how much greed is healthy.
Capitalism is life? How empty is that?
Try belonging, contentment, and acceptance, that's life, and cannot be purchased for any amount of success at capitalism.
Want a ticket, buy it at the ticket agency or not at all. That way, no one has any reason to scalp or tout or whatever you want to call it.
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wealth envy
I remember saying, "This is a free country, I can do what I want!" when I was a kid. If you don't like it, move to a communist country where everyone is equal! Candy asses.
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Limousine liberals
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having sold many tickets on ebay...
"Fans don't sell out events, ticket brokers do."
Everyone seems to be under the misconception that ticket brokers always make a killing off of THEIR events. That's simply not the case, in general. Ticket brokers often end up losing money on the majority of their tickets and making their profits on very few events. 80/20 rule definitely applies.
The fact of the matter is, the industry has worked this way for many years. Brokers "sell out" the shows. They then sell based on basic supply and demand principles. It's economics 101. Just because a new secondary market (eBay) opens up, it doesn't mean that the game has changed. Did Sundance talk about deactivating screening tickets that were sold in the newspapers 10 years ago? No? Then why should they decativate them now that the market they're sold on is different?
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The only thing eBay does is to make the competition harder for the ticket brokers.
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@ #9
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Auction first releases
Modulelize eBay so it runs on any website. Then, host an auction system for any and everything.
"StarWars 17" is coming out this summer?
Presell tickets online in an auction. Every theater would sell them via auction.
Run the auction for X number of days before the movie release date... close the auction hours before the event starts. Send notification to the winning bidder by email, sms, phone call, messenger pigeon, whatever...
Sony Playstation 6 coming out in the winter?
Presell units via auction only. the first 1000 units per store are auctioned off only.
This will limit ticket touting.
If no one wants to bid, there is always the buy now button. But, that button Will only become available after the auction period ends.
Need more ideas?
Set the auction period for a month or 2. Where each unit is sold via auction. Auctions close every 15 days. Free shipping! Winning bidder gets free popcorn. Second place winner does not win the unit, but instead, gets a free controller and a bypass at the next auction (meaning he gets the unit delivered after the next auction ends, plus a FREE remote control!)
People... there are countless ways of going about this... it's a shame our society is so caught up on what other people do...."Oh, he's making money! and we are not!!! Quick, draft up a new law!"
Or, hey!!! Hey!!! Hey!!!! you cant do that!
--why?
Because i patented an idea for that 12 years ago! I'm going to sue you...
Sigh... people are idiots...
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Oh dear, not again.
The way I see it, anyone willing to buy an overpriced ticket is the one to blame. Scalpers (as we call them in the states) wouldn't do it if they couldn't make a profit. So don't blame them for seeing a market and trying to make money-- blame the 'hardcore fans' who buy a $25 ticket for $300.
As has been said before, it's a free market-- and you get the good and bad that it implies. Either the government stays out (for the most part) and let's supply and demand rule the day-- or it controls prices to maintain "fairness". Either way, someone loses-- and someone bitches.
The way it is, the consumer en masse has all the power-- don't buy overpriced stuff and you will eventually stop seeing it sold overpriced.
It's a double-edged sword, people. Live wth it.
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My take on scalpers
I was able to see the Rolling Stones in concert for $10 from tickets from a scalper. The place was full of middle aged drunks who ended up soaking my husband in beer & we only watched for an hour, but we got $90 tickets for a steal. At the college in town, students sell their tickets and are even able to fund their educations by selling their ticket to the big rivalry game at the end of the year...but because the university has insisted that the student i.d. of the person who bought the ticket has to be presented at the gate, people set up systems where they meet up with the person after the game to get their i.d. back. I've also attended a number of concerts on free tickets. I went to a Bill Cosby show about seven years ago and of the thousands of people in the arena, only 400 paid for their tickets. It's also fairly easy (around where I am) to get tickets to movies for free screenings (and then sneak in and see what you actually want...but I'm not endorsing that).
My point(s)? 1) Putting a name on a ticket isn't the be-all end all solution to the scalping problem; 2) People will always keep scalpers in business, just for the hope of getting cheap tickets or tickets to things that sell out quickly; 3) It's not impossible for those with less means to get into events that sell for high mark-up, so let's not sweat the whole 'fair chance' issue on tickets.
I hope that, if nothing else, this will prompt someone to finally confirm that a tout is a scalper.
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Scarcity
So for example, let's say a new movie came to your city, and 20,000 people want to go see it.
Normally, It will be playing several times at hundreds of movie theators, so if one theator jacks up the price to hundreds of dollars, just go somewhere else.
For contrast, let's say the same movie was only playing once in a 20,000 person stadium. The price for tickets will be up there with concert tickets and event tickets.
The difference between the examples is that in the second example, there is a far scarcer amount of tickets.
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Re: Scarcity
Ah, but therein lies the REAL issue, which I don't think anyone has touched on yet.
Tickets are getting less scarce for the brokers, and MORE scarce for the "fans".
How?
Back in the early days of ticket brokers, they would have to physically wait online or call ticketmaster (or hire people to do it for them). When ticketmaster went online, the whole game changed. It wasn't long before people started writing scripts so that the brokers got the tickets at a rapid rate that regular, human fans couldn't compete with. Ticketmaster then added a captcha. That has been defeated as well. Sure, it's not public, and the programs that break it cost in the tens of thousands of dollars, but they are out there. I personally witnessed a distributed system that had a server and was installable on a number of client computers to work with as many accounts as requested, on as many computers as requested, buying as many tickets as requested. Front row seats? Not a problem. This program (at the time I saw it demo'd) also bypassed the queue.
The point is, human fans cannot possibly compete with automated scripts. These scripts are advanced and buy up most of the tickets before anyone even has a chance to buy their tickets manually. Hence, the pool of tickets is much more scarce to the fans. This has never been the case historically, and it represents a HUGE problem that's not easily solved.
I realize that this is waay off the topic of Sundance Film Festival, but hopefully it gives you some insight into the biggest problem the ticket industry faces.
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That said, as a cash-strapped concert-goer, I do resent finding myself unable to get a ticket to a gig at a price I can afford. In the UK, one ticket broker, wegottickets, is going some way to fix this by not selling paper tickets at all, but sending out ticket numbers by email and having punters identify themselves at the door with a credit card - it goes some way to level the playing field between people buying tickets for themselves, rather than in bulk for resale.
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