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Are You Served – A Look At The Secondary Ticket Market

BOSTON (CelebrityAccess MediaWire) — Much ink has been spilled lately over the many states rushing to change state laws to create a more convivial environment for secondary ticket vendors, primarily websites like StubHub and eBay – with claims that a deregulated market will serve to lower ticket prices for the consumer. There have been further efforts to place caps on the service fees placed on tickets by vendors in a number of markets.

One such effort underway in Mass has been sponsored by State Sen. Michael Morrissey, who introduced a bill earlier this year which would limit the additional fees applied to the price of a ticket to 12 dollars above face value. This would apply to so-called "convenience", transaction and venue fees. Morrissey's bill also attempts to rework the state's scalping laws which currently limit the amount an event ticket can be resold for, currently limited to 2 dollars above face value. If Morrissey has his way, ticket resellers would be able to charge up to three times the face value of a ticket.

Some people however are suggesting that his focus on the service fees may be not addressing the root problem.

"Many of us on the committee feel that issuing pricing controls is not some place the legislature ought to be," Rep. Michael Rodrigues, a member of the Consumer Affairs and Professional Licensure Committee which is currently considering the legislation told the Boston Globe.

Consumer activist Colman Herman echoed Rodrigues concerns, telling the Globe that legislators should focus on the secondary market "where the real damage is being done to consumers."

The secondary market damage? What does he mean? As an example, let's take a look at an upcoming show by Canadian rockers Rush at the Arena at the Mohegan Sun in Connecticut. The July 8th show is sold out according to primary ticket vendor Ticketmaster, where tickets had gone for $85.00, & $65.00. Plenty of tickets are available on secondary ticket market site StubHub however, with prices starting at 136.00 each up to $1,389.00 for floor seats. This begs the question of who is being served? Tickets are frequently acquired now by broker operations who utilize automated purchasing tickets to snap up as many event tickets as possible for resale on the secondary market, leaving the average consumer with few options other than to purchase tickets from StubHub or similar, regionally-focused vendors. StubHub, who as previously reported in CelebrityAccess was recently acquired by auction website eBay makes commission of 15 percent of the sale price of the tickets. Needless to say 15% of 450 dollars is much better deal for eBay than $15% of 65 dollars.

eBay has been instrumental in a vigorous lobbying effort from whence many of these new modifications to state scalping laws has arisen. Hand in hand with a recent loosening of Federal Trade Commission regulations on a broad array of industries, eBay lobbyists have been pressing the legislative flesh in many states aggressively, on a variety of issues.

Proponents of the deregulated secondary market claim that prices will eventually regulate themselves, that ticket prices will eventually mold themselves to the demand and capability of consumers to pay and that may well happen eventually but currently, ticket prices for events are being priced out of the range of the average consumer with no apparent end in sight. – CelebrityAccess Staff Writers