Jacob Zinn :: journalist + photographer

JRNL 1160 – Research News Story – Money Talks: Scalpers Steal the Show

JRNL 1160 – Introduction to Journalism

December 2008

Money Talks
Scalpers Steal the Show

Getting AC/DC tickets is a dirty deed and it isn’t done dirt cheap.

On September 19, scalpers cut the virtual ticketing line and sold out AC/DC’s Vancouver concert using illegitimate ticket-buying software.

British Columbians who had hopes of seeing the Australian rock group at their November 28 show in Vancouver are now victims of online ticket scalping.

Using software to bypass security measures of Ticketmaster’s website, scalpers acquired large blocks of tickets and kept other users out, according to the Vancouver Sun.

Another article in the Vancouver Sun reported that within minutes of the sale, tickets appeared on resale sites such as TicketsNow.com, a subsidiary of Ticketmaster.

Ticketmaster priced seats at $99.50 each on September 19, but the same article also noted tickets being resold three days later on TicketsNow.com, reaching $1,318.

Ticket scalping is a growing issue in Vancouver, and with the 2010 Winter Olympics approaching, VANOC published a press release expressing their concerns.

The release from June announced that VANOC is taking measures to protect consumers from unauthorized resale of tickets to the Winter Games.

“These measures include deploying ‘secret shoppers’ to purchase tickets from unauthorized dealers… and disabling all tickets from unauthorized sources,” read the press release.

VANOC stated that they may create a designated resource for ticket resale to guarantee authenticity, but recommends that consumers buy directly through them until then.

While VANOC is taking steps to prevent ticket scalping, the Boston Globe reported that Ticketmaster has recognized the issue of automated ticket purchasing devices.

The April 2007 article stated Ticketmaster filed lawsuits last year with RMG Technologies, a Pittsburgh-based software development company, over unauthorized ticket purchases in Illinois, Texas, and Massachusetts.

In March, TicketNews interviewed the president of RMG Technologies, C.J. Garibay, who defended his company, saying they had not violated the Digital Millennium Copyright Act.

“We expected Ticketmaster to adapt their software to lock us out any day after we rolled out our program,” said Garibay.

In October 2007, RMG Technologies was ordered by a federal judge to cease all sales of its illegitimate ticket software, according to USA Today.

Sean Moriarty, the president and CEO of Ticketmaster, said in the article, “We will not allow others to illegally divert tickets away from fans.”

In June, TicketNews reported that a federal judge in Los Angeles awarded Ticketmaster a permanent injunction against RMG Technologies and a judgment worth $18.2 million.

Garibay told TicketNews that his company lost the lawsuit only because RMG Technologies ran out of funds for legal costs, having already spent roughly $200,000.

“Ticketmaster didn’t win on the merits of the case,” said Garibay. “They won on a technicality because the other team couldn’t afford to show up.”

The judgment prohibits RMG Technologies from “creating, trafficking in, or facilitating the use of” software that allows brokers to bypass security measures on Ticketmaster’s website.

Despite the software sales ban against RMG Technologies, the Vancouver Sun has reported newer instances of automated ticket purchases, one being AC/DC’s upcoming Vancouver show.

Billboard Magazine reported the day before AC/DC tickets went on sale that Ticketmaster employed new paperless ticketing technology for fan club members and select seats.

The article explained that paperless tickets require the purchaser to bring their credit card and valid photo ID to the show and makes resale difficult.

However, it stated that paperless tickets would only account for as many as 3,000 tickets per venue, making the rest of the tickets hard copy.

Lesley Intile, a Ticketmaster outlet retailer, unknowingly had a scalper in her line-up the morning AC/DC tickets went on sale.

“He went down the line, holding them in his hands, waving them about, yelling, ‘$300 each,’” said a discontented Intile. “That, to me, is rude.”

Shortly after the show sold out, articles were published in the Province and the Vancouver Sun, which received feedback from fans throughout the Lower Mainland.

Gareth Driscoll, an AC/DC fan, wrote to the Province, “This affects everyone that goes to a concert… shine a light on this issue.”

Driscoll wasn’t the only one out of luck—Aaron Orieux, another fan, was also unable to obtain tickets and is upset with the online scalpers.

“They’re going to screw all of these loyal fans over, just so they can make some profit,” said Orieux. “Do they not have real jobs?”

According to an article in the Saskatoon StarPhoenix, scalpers in Saskatchewan used the same software several months ago and sold out an Elton John show.

Saskatchewan’s Minister of Justice, Don Morgan, said in the article, “What we’re troubled by is what appears to be preferential treatment to bulk ticket resellers.”

Minnesota Public Radio reported in April that Tim Pawlenty, the Governor of Minnesota, signed a bill that outlawed unauthorized ticket-buying software in his State.

Stephen Happel, a Professor of Economics at Arizona State University, has conducted research on ticket scalping and believes prevention is the responsibility of the promoter.

“The reason the scalpers are doing this is the prices are too low and they know that they can charge higher prices,” said Happel.

Even if RMG Technology’s software was outlawed, Happel said, “Scalpers and brokers… will still use any means possible to acquire tickets—any legal means possible.”

Happel disapproves of automated ticket purchasing software, but doubts that paperless tickets will stop scalping and personally thinks that Ticketmaster is endorsing scalping through TicketsNow.com.

“If Ticketmaster had its way, it would try to… control both the primary and secondary market,” warned Happel, “I am totally opposed to that.”

With the possibility of insider trading, Happel fears that leftover tickets not sold by Ticketmaster may end up on TicketsNow.com, at prices above face value.

Happel doesn’t think anti-scalping legislation is the solution, saying, “The more you pass laws against scalping, the more you’re going to bring in unsavoury characters.”

CBC reported in July that Ticketmaster is trying to repeal existing anti-scalping legislation set by provincial governments in Manitoba and Ontario that ban ticket resale.

Voicemail messages left for Rita Isaacs, the general manager of Ticketmaster’s Vancouver office, were not returned, nor was she available to give comment in person.

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