Ticket sales for popular live events like concerts and sports performances have often been associated with frustrating and annoying issues, such as inflated prices for tickets bought in bulk by ticket touts and scalpers as well as a lack of transparency in the actual price breakdown of the ticket itself as advertised by the official ticket seller. The Massachusetts state government has attempted to address these issues within recent legislation signed into law by the state Governor, Maura Healey.
What are the problems with ticket sales addressed in the new legislation?
The more popular the live event, the greater the potential problems associated with selling tickets to fans. This is partly simply due to the laws of supply and demand. There is typically only a certain number of tickets available for a particular event, so it stands to reason that if there are more people wanting to purchase tickets than the number of tickets being sold, that some people are going to be disappointed. The main problems addressed by the state’s new ticket sales laws are:
- a lack of transparency at the point of sale, particularly hidden “extra” fees tacked on to the advertised price of the ticket which typically are not revealed until the would-be purchaser attempts to pay for the ticket;
- uncontrolled re-selling of tickets;
- price gouging caused by block purchase of tickets using bots, causing an artificial shortage of tickets and consequent inflation of the price of the re-sold tickets.
Attempts to address these problems have been made before and the legislation that has now been passed does incorporate some of these attempts, such as the “Transparent Ticket Pricing” bill submitted by Sen. John C. Velis in the last legislative session. The new legislation is itself only a part of the much more comprehensive Economic Development Bill passed in the Senate and signed by the Governor.
The issues listed above are explored in more detail below.
Lack of transparency in advertised ticket sales
Everybody who has hunted for airline tickets online would be familiar with the common practice of seats on flights been sold by third party agents. These websites do not always reveal the true full cost of a flight until almost the last minute, just before a credit card is used to pay for the flight. The advertised price is typically augmented by taxes and airport levies, baggage fees, seat allocation fees, extra insurance cover, etc. etc.
The same problem occurs with event ticket sales. It is often not until the last minute that an advertised event ticket price is inflated by added extra fees, which can sometimes double the original cost of the ticket. For many fans, the sudden revelation of the inflated cost is enough to decide not to buy the ticket or accept the cost, having resigned to pay more than was budgeted.
The purpose of the original Velis Ticket Transparency Bill and what is now incorporated into the new legislation is to make it compulsory to disclose all fees that are part of the overall cost of the ticket so that they are obvious when advertised by the official ticket seller.
Uncontrolled reselling of tickets
This is partly related to the more serious problem of block online purchases by criminal individuals. Some official ticket sellers make it a requirement that tickets cannot be resold or given away by purchasers, whereas others may not make it a requirement to prohibit reselling. Others still may not have any obvious rules. Basically, when an official ticket seller sells a ticket so that it can only be used by a specific individual, the purchaser may have to supply i.d. in some form, such as a driver license to buy the ticket. The ticket is then issued in that person’s name.
In many cases, where reselling has been allowed, the intent of reselling may quite innocently be because the purchaser no longer wants to go to the event, cannot go for some reason, or is buying the ticket on behalf of someone else as a gift. However, even well before online ticket purchases became commonplace, reselling of tickets could result in artificially inflated prices for the resold tickets, especially when there was a serious shortage of tickets. Enterprising, but somewhat unscrupulous individuals, often managed to legally buy a whole bunch of tickets, causing a shortage of supply and allowing the ticket “touter” to resell the tickets at a profit.
The new legislation attempts to limit this problem by permitting official ticket sellers to prohibit reselling or transfer of tickets once sold, except back to the official seller if no longer wanted. This will only be allowed as long as the rules are clearly advertised to all purchasers, i.e. so that reselling or transfer prohibition is made transparent.
It has to be said here that some consumer advocacy groups have been against this part of the legislation arguing that it should be up to the purchaser what they do with the ticket they buy, not the official ticket seller.
Online ticket sales through the use of bot
The use of “bots” to purchase blocks of tickets online is now illegal as a result of the new ticket sales legislation incorporated within the Economic Development Bill.
The use of bots has been a problem for some time now, but the legality or otherwise has not always been consistent. In fact, Massachusetts is only one of 10 states in the U.S. that has attempted to prevent online ticket scalping.
“By the use of bots” means the practice of purchasing tickets available online for a particular event by an individual criminal or organization using fake accounts. Many individual fake accounts are created, often using fake i.d.s or names or identities that have been taken or stolen illegally from social media accounts or other information available online. Each account is then used to make a single ticket purchase, the sum result of all the accounts created being that the individual or organization ends up with a block purchase. These tickets can then be resold when the time is right and at prices way higher than the original official price. The shortage caused by the block purchases naturally helps to inflate the prices that can be asked. The re-sold tickets may be sold through various means such as through social media sites or through the dark web.
It has been estimated that some major events have seen up to 40% of ticket sales being made by this now illegal pathway.
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