Scalpers Earned $25M Gaming Online Ticket Sellers

SeattleGameboy writes "An indictment has been issued for online ticket brokers known as 'Wiseguy Tickets and Seats of San Francisco.' From 2002 to 2009, they used bots, server farms, and CAPTCHA hacking to buy vast number of premium tickets (Springsteen, Miley Cyrus, NFL, MLB playoffs, etc.) and made $25 million in profits. 'They wrote a script that impersonated users trying to access Facebook, and downloaded hundreds of thousands of possible CAPTCHA challenges from reCAPTCHA. They identified the file ID of each CAPTCHA challenge and created a database of CAPTCHA "answers" to correspond to each ID. The bot would then identify the file ID of a challenge at Ticketmaster and feed back the corresponding answer. The bot also mimicked human behavior by occasionally making mistakes in typing the answer, the authorities said.' I guess you can break any system like CAPTCHA if you want it badly enough."

Comments

What a lot of work.

[dtmos]

Wouldn't it have been easier just to make the money legitimately?

Re:What a lot of work.

[Anonymous Coward]

Yes, 25 million USD is easy to make legitimately, that's why everyone is doing it!

Re:What a lot of work.

[Hognoxious]

Wouldn't it have been easier just to make the money legitimately?

Perhaps, if you're Celine Dion or George Lucas.

But 25 million would take quite a few years for most people to earn.

P.S. Did they do anything that was actually illegal?

Re:What a lot of work.

[MichaelSmith]

To be honest I don't see what they have done wrong. Their actions are no different from normal retailing. You buy low at a bulk supplier and sell high to individuals.

Sellers could cut them out by raising their prices so that demand matches supply.

Re:What a lot of work.

[xtracto]

Yes, 25 million USD is easy to make legitimately, that's why everyone is doing it!

guess you can break any system like CAPTCHA if you want it badly enough."

Moreover, this shows that the used security mechanism is worth at least 25 million USD.

The problem is that the CAPTCHA approach is flawed. Any similar type of challenge-response system can be abused for illegal activity. At the very end, the only thing an attacker has to ensure is that the cost of obtaining enough challenge-responses is less than the outcome of the illegal activity.

Say, if they pay a group of Chinnese guys USD $0.39 an hour, you can get a fair amount of human identifying challenge-response answers.

Re:What a lot of work.

[Anonymous Coward]

I've been working since 2002 and I sure as hell don't have 25M$

Re:What a lot of work.

[RuBLed]

They are an unnecessary middle man. In line with your comparison, they are hoarding the goods from the ones selling to individuals themselves then raise the price because they now have most of the supply.

Re:What a lot of work.

[Arathrael]

Sellers could cut them out by raising their prices so that demand matches supply.

And wouldn't that be great? Instead of the venue, artists, promoters, ticketing agencies, etc., all covering their costs and making a healthy profit, they could... make a bigger profit. Woohoo!

Of course, for the millions of people attending events, they'd be spending a lot more than they were, or able to attend fewer events, especially if they want to sit in anything remotely resembling a good seat. And front row seats would only be affordable by billionaires and the five richest kings of Europe. But hey, people who were already making a healthy profit would make even more! Hurrah!

Or, maybe, just maybe, in the interests of culture, fixed price ticketing is actually a good thing...

Re:What a lot of work.

[MichaelSmith]

Or, maybe, just maybe, in the interests of culture, fixed price ticketing is actually a good thing...

So then how do you distribute tickets, other than having a mad, random rush to sell them in the first few seconds they are on sale?

Re:What a lot of work.

[jonadab]

> > Sellers could cut them out by raising their
> > prices so that demand matches supply.
>
> Of course, for the millions of people attending
> events, they'd be spending a lot more than they were

Nobody's holding a gun to your head and making you buy a ticket. People would only be spending what the tickets are worth to them.

> or able to attend fewer events,

On the contrary, if ticket prices went up until market equilibrium was reached, people who are willing to spend a bit more for the tickets would be able to attend as many events as they want, because there would *be* tickets available to buy (legitimately, not from scalpers), and they'd be easy to find. The artificial scarcity makes it *harder* to attend. With fixed-price ticket sales, if an event is even a little bit popular then you just can't go, unless your time is worth absolutely nothing and you can afford to go on a multi-week fanboy quest to hunt down the last remaining ticket from a scalper in Kansas.

> especially if they want to sit in anything remotely
> resembling a good seat. And front row seats would
> only be affordable by billionaires and the five richest

There aren't enough billionaires and kings to fill up the whole front row, so presumably the prices wouldn't be *quite* that high. Ordinary CEOs, even of medium-sized companies, would probably be able to afford front-row tickets to most events.

Hey, if the good seats aren't more expensive than the cheap seats, something is wrong. It's not like a normal mortal can ever buy a front-row ticket to anything anyway. They're always sold out already, even if you're the first one in line the first day tickets go on sale. I think the groupies must snap them up and scalp them, or something.

> But hey, people who were already making a healthy
> profit would make even more! Hurrah!

Oh, yes, I forgot that it's automatically evil anytime anyone makes any money for any reason, ever. It doesn't matter that it would make things better for everyone. If somebody's going to make money, it's obviously a bad thing.

Re:What a lot of work.

[dtmos]

The indictment actually states that, ". . .Wiseguys and its owners made more than $20 million in profits. . ." (p. 2 of the indictment), so let's start with the $20 million number.

Keep in mind that:

(a) The $20 million was made over an eight-year period, 2002-2009, so the average was $2.5 million/year;

(b) The profit of the enterprise was split among the two principals (the CFO received $165,000 and the programmer received $150,000, natch...), so that brings it down to an average of $1.25 million/year for the two principals (I think we can agree that the salaried guys did not do well in their risk/reward ratio calculations); and

(c) The "profit" figure used in indictments is nearly always what a legitimate businessperson would call "gross profit," meaning, to quote Wikipedia, "the difference between revenue and the cost of making a product or providing a service, before deducting overhead, payroll, taxation, and interest payments." As a criminal enterprise, these guys didn't have to worry about taxation (at least, the correct amount of taxation), but they did have to pay the salaries of the other 10-15 people working for Wiseguys Tickets, Inc., and all the other expenses associated with running the enterprise (computers ... ). All of that would have to come out that $1.25 million/year/indictable person. A quick look through the indictment shows the several persons on staff in the US being paid from $55k to $142k/year each, and the ones in Bulgaria being paid from $1 to $1.5k/month each, so you do the math.

The point being, the retirement plan associated with these types of schemes is typically poor, as it's usually at a federally-funded establishment. These guys ran a small tech company with overseas offices, and could have done the same legitimately at a salary of probably $150k/year which, once benefits were included, would be equivalent to $250k/year in cash (to make a direct comparison to their criminal enterprise). In a legitimate business, the CEO also would have had significant stock options and other perks given to him by the company's board to motivate him to grow the company. With even moderate growth over that period, the CEO could be very well-off. As I say, it's easier to make money legitimately.

And you sleep better.

Re:What a lot of work.

[Arathrael]

So then how do you distribute tickets, other than having a mad, random rush to sell them in the first few seconds they are on sale?

Registries of interest. Membership sales and similar schemes. Lotteries. Pre-sales. Phased sales. You know, any of the many ways that are already used.

There isn't a perfect solution where everyone who wants to go to an event where demand exceeds capacity can go. But pricing according to demand is probably, culturally speaking, just about the worst solution you could come up with.

Re:What a lot of work.

[jabberw0k]

Indeed -- at the box office, sell tickets

• First hour of sale, $1,000 ($500 goes to a charity)
• Second hour, $500 ($100 goes to a charity)
• Third hour, $300 ($50 goes to a charity)
• Second day, $50
• Day before the concert, $10
• Day of the concert, $50
• After the concert starts, $1

Re:What a lot of work.

[Anonymous Coward]

The whole freaking market consists of "unnecessary middle men". It's the way the (western) world works. People buy from retailers, retailers buy from bulk suppliers, and they buy from the factories. And that's a short chain.

Every single one of the above raise the price from what it was at the previous step.

Re:What a lot of work.

[Arathrael]

Artifical scarcity? Get a grip. It's actual scarcity. There are only so many tickets available. It is impossible for everyone to be able to attend every event they want.

Demand-based pricing wouldn't change that ('make things better for everyone?' Are you nuts?) except for the richest. But instead of ability to attend being based on timing and luck, essentially, it biases attendance towards wealth. This would make it worse for many. Further, it would reduce the diversity of those attending. That would be bad, both culturally, and for the artists/teams/etc., if you think about it. It is not a good idea.

And just FYI, front row seats are often held back from the initial sale for friends and family of the artist, etc. In those cases, they go on sale later if and when they're not taken up.

Re:What a lot of work.

[Anonymous Coward]

Lotteries would be among the worst sales setups as it can give tickets to those only mildly interested (as demonstrated by their unwillingness to pay a higher price) over those more interested. I admit that having long waitlists can be useful (Duke basketball for instance, is famous/infamous for having students camp out for months to get into the UNC game, thereby prioritizing the more passionate fans over those with deeper pockets or random students). Membership sales are disgusting and promote scalping (many college sports venues require large booster contributions to even buy a ticket and only sell season tickets, giving scalpers vast control of ticket sales/distribution).

Re:What a lot of work.

[Anonymous Coward]

They are making it legitimately. They're buying an undervalued product and reselling it at market prices. That's competition at work.

Re:What a lot of work.

[erroneus]

Nice work. You forgot one thing when discussing what "easier" means -- entry into market.

Let's use porn as an example. Legitimate media is extremely competitive. Want to start a TV station? A Newspaper? Put out a movie? Music? Those things are dominated by incumbent players who do not like new competition. On the other hand, porn is forced into a low profile, so even though there are big players in the industry, brand names and other matters of high public notice barely even exist. So nearly anyone can make porn.

And since we are talking about event tickets, we are also talking about a pretty well limited and controlled market. It would be unthinkable for someone to just appear out of thin air and start making that kind of money legitimately. Scalpers, on the other hand, are delivering the premium goods with no need of marketing, reputation or other complications required for legitimate business.

So when you are talking about "easy" there are other aspects to consider.

Re:What a lot of work.

[maxume]

You are making an awful lot of assumptions (the biggest one being that every single show will sell well enough that people that can afford fixed prices will be priced out).

Re:What a lot of work.

[Anonymous Coward]

They are an unnecessary middle man. In line with your comparison, they are hoarding the goods from the ones selling to individuals themselves then raise the price because they now have most of the supply.

Then they should fucking incorporate, because that's exactly what 90% of corporations do every day of their lives.

Re:What a lot of work.

[Comboman]

So then how do you distribute tickets, other than having a mad, random rush to sell them in the first few seconds they are on sale?

How about an auction? The first tickets released would get bid up to insane levels by superfans/rich a-holes who want to guarantee they get a seat. Once that high demand level is filled, the medium demand audience bids up tickets to medium prices, then whatever is left over purchased at lower prices by the low demand audience. This type of price discrimination allows multiple price points for otherwise identical products without having a middleman (i.e. the scalper) cutting into the profits of the artists/promoters/venues.

Re:What a lot of work.

[Anonymous Coward]

the CFO received $165,000 and the programmer received $150,000, natch...

And CFO in this case means "Chief Fraud Officer." :P

Re:What a lot of work.

[xtracto]

Why? because I used Chinnese low minimum wage as an example?

I would have used Mexican minimum wage (as low as USD $0.5360087 according to current exchange rate) but it is higher than what you can get in China.

Re:What a lot of work.

[Arathrael]

You are making an awful lot of assumptions (the biggest one being that every single show will sell well enough that people that can afford fixed prices will be priced out).

Not really, no. I think you're confusing 'reasoned conclusion' with 'assumption' there.

With a demand-based pricing system, prices would inevitably rise for any popular event where demand exceeds supply. A rise in prices will price out some people who could have afforded the lower fixed prices, inherently so (the exact degree to which that is true will depend on the extent of the rise which will in turn depend on the particular supply/demand siutation of a particular event, but it will be true to some degree for any popular event).

There are of course events where demand doesn't exceed supply, but those aren't really relevant in this context I think. Getting tickets to unpopular not-sold-out shows isn't usually a problem...

Re:What a lot of work.

[msuarezalvarez]

Why are you impling that porn is not legitimate media?

Re:What a lot of work.

[Hognoxious]

Given that the "just right" demand is equal to the capacity of the venue - which is fixed - it's more likely that there'll be an excess of demand, but there certainly could be an oversupply.

In that case it would make sense for the promoter to sell tickets off cheap (an unsold ticket gets you nothing); that'd be a saving for the customer compared to fixed pricing.

Re:What a lot of work.

[aminorex]

They did make the money legitimately. It's the law enforcement operation which is illegitimate.

Re:What a lot of work.

[mx_mx_mx]

Then everybody will wait till last day to get a discount.

Re:What a lot of work.

[Arathrael]

In that case it would make sense for the promoter to sell tickets off cheap (an unsold ticket gets you nothing); that'd be a saving for the customer compared to fixed pricing.

Fixed pricing doesn't preclude the promoter dropping that price if the tickets haven't sold. That already happens.

Re:What a lot of work.

[PopeRatzo]

Wouldn't it have been easier just to make the money legitimately?

I'm still trying to figure out how what these guys did was wrong.

The real criminals are the monopolists at Live Nation and Ticketmaster, whose merger will create an entity that controls over eighty percent of the live concert promotions business, and who already demand a $12.50 "service" charge for the privilege of being able to buy a ticket online and another $2.50 just so you can print the ticket out on your own printer. (I guess that last fee is just a penalty they make you pay because you are saving them the cost of having to print and ship a ticket. No good deed goes unpunished, you know.)

The question now, is "just how high can ticket prices go?".

There used to be mom-and-pop music promoters in just about every town in America, putting on live music in bars, parks, gymnasiums and VFW halls. They've created musical venues that allow musicians of all types to ply their wares and make a living. That's going to end now that Live Nation/Ticketmaster are going to create a $4.4 billion behemoth that's going to put the small promoters out of business and control nearly every single live venue.

You know what? These scalpers aren't the problem here. When a system sucks this bad, why shouldn't scalpers game it? You want a "free market" system? Welcome to life.

Personally, I stopped going to the "big" concerts some years ago specifically because of the Ticketmasters and Live Nations (now one entity), and I go to see music in much smaller venues as often as I can, hoping to support the music and not put money in a monopoly. Now, that's going to be harder because at some level almost every dollar spent on live music will be going to these bastards. Maybe I'll just start putting all my entertainment dollars into the hats and guitar cases of the many excellent buskers that inhabit the streets of my city (at least once winter ends).

Re:What a lot of work.

[Anonymous Coward]

They are an unnecessary middle man.

Exactly. Ticketmaster is already in place as the middleman. And they already add a 34% markup in guise of convenience charge. Do we really need someone else cornering the market, driving up prices?

Re:What a lot of work.

[nosfucious]

I believe the various ticket selling near-monopolies (the usual suspects) would love to move to an E-bay like system of auctions. Such a programming undertaking is nearing completion. Want Rolling Stones (for example) tickets and are prepared to pay $US 10,000? They are prepared to let you pay that much.

Re:What a lot of work.

[maxume]

Well, I'm not real sure that someone who can afford to attend a concert for $100 a seat would be priced out by tickets that were $150 (or $20 and $30, you get the idea).

Also, your second paragraph hinges on luck being more virtuous than $50, which I see as a pretty big assumption.

And if we are discussing ticket prices, I think the fact that some shows would end up having cheaper tickets available is pretty relevant (especially when the 'fairness' of higher prices is being discussed!).

Re:What a lot of work.

[AmonTheMetalhead]

Sure, if you consider fraud to be legal

Re:What a lot of work.

[Hognoxious]

That's not fixed then, is it?

Re:What a lot of work.

[Anonymous Coward]

It's not racist if it's true. For instance, the Popeyes down the street is always filled with all black guys, and usually just that fat 1 white guy. So asserting that black people love fried chicken isn't racist. Also, here is a "racist" news story for your enjoyment: http://www.youtube.com/watch?v=8pyW6w5B7Aw

Re:What a lot of work.

[Anonymous Coward]

**cough** **cough** ASCAP **cough**

Re:What a lot of work.

[jandrese]

I've always harbored fantasies that some day Ticketmaster/Live Nation will be hit by a federal antitrust lawsuit and be forced to loosen the deathgrip they have over event ticketing.

Re:What a lot of work.

[Arathrael]

Yes, in this context, it is.

Re:What a lot of work.

[AmonTheMetalhead]

No they were not, read the frecking article.

Re:What a lot of work.

[Arathrael]

Well, I'm not real sure that someone who can afford to attend a concert for $100 a seat would be priced out by tickets that were $150 (or $20 and $30, you get the idea).

That basically boils down to, "if someone has $100, they must have $150". You can see the problem with that, right?

As for luck being more 'virtuous' than $50, it's not really about virtue, it depends what you're aiming for. If you want diversity in terms of attendance - and there are good reasons for that - then yes, luck is going to be a better system than 'most money wins'.

And in terms of cheaper tickets becoming available, I don't think that's really likely to be the case to any significant extent. If tickets sold out previously, they're unlikely to become cheaper, and if they weren't selling out previously it's often the case that they would have been available cheaply on the door or through promotions towards the date of the event anyway.

Re:What a lot of work.

[EastCoastSurfer]

Then everybody will wait till last day to get a discount.

And possibly not get a ticket. I bet you would see more tickets sold before that last day than you think because it would allow each person to make their own value calculation.

Re:What a lot of work.

[EastCoastSurfer]

An auction is basically what is already happening. The scalpers are acting as the auctioneers in this case. They are selling the tickets right at the level at what people are will to pay.

Re:What a lot of work.

[osgeek]

1. Bot nets are typically created illegally.
2. Sellers have a right to sell to whomever they choose as long as they don't discriminate for the legal mix of race, color, creed, etc. They have a right to "limit one per customer", as it were. After that transaction, I'd agree that it's out of their hands - but violating the seller's request to limit the transactions to individuals by impersonating different people is fraudulent, I believe.
3. Monopolistic behaviors need to be monitored for abuse. I'm a free market guy most of the time, but monopolies happen and when they do they really tend to shit in the punch bowl. Since large venues for entertainment and certain events do tend to extremely limited as a resource, I'm okay with some oversight.

I think that sellers have a right to control the first sale without fear that buyers are misrepresenting who they are. After that, the market should be allowed to do its work. I'm okay with people reselling their tickets for whatever the market will bear. I'm okay with people buying up tickets from individuals to resell them for a profit. I just don't like misrepresentation/fraud or other illegal activity entering the picture.

Re:What a lot of work.

[Bigbutt]

Don't forget too that if every scalped ticket isn't sold, that comes off of the bottom line. Heck, it might explain why "sold out" concerts have quite a few empty seats.

[John]

Re:What a lot of work.

[osgeek]

Why? It's ENTERTAINMENT.

If society decides with its dollars that entertainment is worth more then let the dollars speak that. Let there be more money involved. Let us build more venues for watching live entertainment. Let our children see entertainment as a more likely career and work for it.

More than anything, pricing entertainment according to demand seems the fairest thing possible.

As I mentioned in another post, monopolies, botnets, and fraud are bad. Letting demand set prices is good.

Re:What a lot of work.

[grub]

Why is it racist?
It is a fact that labour from China is dirt cheap. That's why there are so many factories there. Does that make you racist for buying products "Made in China"?

Overly political correct ACs... why do I bother?

.

Re:What a lot of work.

[blackest_k]

Why pay to get them solved?

disclaimer i'm sure badoo isn't getting people to solve captures for black hat reasons.

In badoo if you give a website address or a user name for msn or such like when your chatting, you have to solve a capture to continue and send the Link or email address.

Why?

As you are allowed to send the address anyway once you solve it there is no point asking really unless the point is to solve captures.

Badoo doesnt seem to have a visible means of support but it does have many 1000's of users solving captures.

Re:What a lot of work.

[Anonymous Coward]

If the scalpers are able to sell the tickets at a profit, then the original tickets are undervalued. They're setting the ticket prices where they should be so people who don't have time to mob the ticket counters as soon as they open can still get tickets. The ticket sellers may not LIKE the scalpers, but that doesn't mean what the scalpers is doing is immoral.

Re:What a lot of work.

[smidget2k4]

Yes it is. It would be the like going to a golf club, seeing only white people, and saying "All white people love golf and love to waste obscene amounts of money on it". You are making sweeping generalizations based on skin color because you're too stupid realize that there might be black people, elsewhere, who aren't currently eating fried chicken.

Re:What a lot of work.

[Anonymous Coward]

You are making sweeping generalizations based on skin color because you're too stupid realize that there might be black people, elsewhere, who aren't currently eating fried chicken.

I guess that would depend on what the jail is serving.

Re:What a lot of work.

[ottothecow]

Paying people to solve the captchas won't work as well as building a database of possible captchas... Ticketmaster only gives you something like a 2 minute window to complete the process so you can't just have somebody hammering through captcha's for a few hours every day...you need access to all of them in the few minutes after the tickets go on sale (as opposed to making fake email accounts or something where the timing is not important).

The real flaw here is that the captchas were reused and identifiable when reused. It sounds like the file name for the image didn't even change...If no two users of any site ever saw the same captcha, this database technique would not work.

Re:What a lot of work.

[geekoid]

I suspect he mean 'conglomerate' media.

Re:What a lot of work.

[Ambiguous Puzuma]

What I want to know is, why was a few hundred thousand reCAPTCHA challenges enough to have a reasonable chance of getting a duplicate? Shouldn't the number of possible challenges be several orders of magnitude higher to discourage this kind of attack?

Re:What a lot of work.

[smidget2k4]

I think his most fallacious assumption is that I can't attend every event I want to attend.

I most certainly can sit in my underwear watching cat videos on the internet every night, thank you very much!

Re:What a lot of work.

[cerberusss]

So nearly anyone can make porn

I'm married, you insensitive clod!

Re:What a lot of work.

[cayenne8]

While I'm not a fan by ANY stretch of the imagination of scalpers...I'm a bit puzzled as to exactly what laws were broken here?

It did mention they may have hacked into Ticketmasters systems, and if they did break in, ok, I can see that.

However, using scripts/applications to log into a site and buy tickets, I don't see how that is illegal? They are just using a program to mimic what human could do on a website that only reacts to input and doesn't care itself if a human or a scripts is behind the computer connection being made.

Is it against the law to study and make a database of captcha's?

Like I said..I hate scalpers, they grab all the best tickets for places that allow scalping, and even in states where you can't scalp, they grab the tickets and sell to people outside the state keeping locals from getting tix (since they can't by law pay more than face value).

But, I have a hard time viewing the mere fact that someone devised and used a program to auto-purchase tickets as being something illegal? What if an enterprising person that really loved going to shows did the same type thing to ensure that he could buy the best seats for a show that went on sale for himself and his friends? Same principal? In the old days when you had to call in for tix, would they have arrested people for having speed dial (new at the time) and using it to an advantage over people dialing by hand? Hmmm....

Re:What a lot of work.

[Arathrael]

Leaving aside points about merchandise sales, diversity of attendance, size of fan base, and the difference between specific and generic entertainment, look at it this way.

Say an artist wants to sell tickets to his gigs at a fixed price he considers fair, that the majority of his fans would be able to afford. Bear in mind this is about who actually attends the gig as much as it is anything else.

Why exactly should he not be allowed to do that? How is it fair, to the artist, to circumvent his intentions and require demand-set pricing (whether directly, or indirectly by allowing scalping)?

Re:What a lot of work.

[geekoid]

(a) That is true with crimes where the value is 'uncertain' in this case all the values are known so the 20 million is probably a reasonable net for selling 1 million tickets. When you 'street' value for drugs is not really based on much except the maximum a person might sell the drugs for, it's easy to defend that number in court. When you can actually show how much they paid for tickets, how much the paid employees and other over head, and how much they had left over you need to be a lot more accurate. Otherwise you look like an idiot and risk the case.

At least that's how it was presented to me when I had to write software for attorneys.

I suspect what they had was 5 million in operating costs and 20 million in profit. That would ne the typical way news reports screw up the amounts.

Re:What a lot of work.

[Anonymous Coward]

He also compared US year paycheck to bulgarian monthly check, but who really cares, eh? ;-D

Re:What a lot of work.

[Scratch-O-Matic]

The problem is that the CAPTCHA approach is flawed. Any similar type of challenge-response system can be abused for illegal activity.

I met a guy who was a pilot in Vietnam. They had (and still have) a system where everyone carries a card with a grid of numbers and letters on it, and you can authenticate someone over the radio by picking a couple spots on the grid and they respond with, for example, the character adjacent to them. Well, he forgot his card one day and was queried by a controlling agency using the authentication card. He told them to stand by, switched frequencies, and issued the same challenge to another agency. They responded, and he switched back and passed it along to successfully authenticate himself.

Re:What a lot of work.

[mog007]

Wow. The guy was only a pilot? With that kind of thinking he should be in intelligence, or even handling strategy.

Re:What a lot of work.

[ottothecow]

I'd imagine that ticketmaster has some sort of rule banning automatic and bulk purchase of tickets. They did both of these which is pretty much the definition of fraud--maybe not in the legal arena (since its probably just governed by some click-through agreement) but certainly in that they intended to deceive through trickery.

I would imagine ticketmaster is perfectly free to bar these guys or their affiliates from ever purchasing from them...there are probably some laws there as well.

Re:What a lot of work.

[hairyfeet]

As a southerner I can point out there was actually a generational reason why black folks like certain fried chicken and white folks don't. It is because the share croppers didn't have the land for raising beef, but did have enough land for chickens and pigs, and while the poor white folks were Irish and Scottish, and liked their foods bland, the black folks were from Africa and the Caribbean, and their food had more spices. That is why the black folks go to Popeye's (they prefer the taste of the peanut oil and spices Popeye's uses) and the white folks are getting the mild stuff at KFC, it is just a natural cultural preference, nothing more.

Or are you gonna say next it is racist to say Mexicans like hot peppers in their cuisine and Italians use a lot of tomatoes in their traditional dishes? Every culture has their own general preferences for food, nothing racist about that, it is just different tastes, which if anyone were to study it I'm sure it would be traced back to different concentrations of taste buds from those that are from different regions. American black culture has a history of a taste for soul food, of which chicken cooked in certain ways is traditional, that is just a fact and is no different than the fact that those of us from Irish backgrounds are used to milder foods because that is what grandma used to make. It is culture and heritage and the quicker the PC police stop screaming racist for daring not to have everyone have an identical palate the better.

Finally as for Popeye's? I spent nearly 5 years touring the south with a black blues band. They used to joke I was the "affirmative action token white boy" and on the road we ate a LOT of fried chicken, and they would always stop at KFC for me before they headed over to Popeye's for themselves. They said KFC tasted like cardboard, while I didn't care for the peanut oil and spices used in Popeye's batter. Or is that observation racist too?

Re:What a lot of work.

[amicusNYCL]

It's not illegal to break a corporate policy, at least not in itself. They got charged with 43 counts of unauthorized access and wire fraud. Part of the unauthorized access was from the bots, where the site had a disclaimer saying they are not authorized if they are using an "automated" program (BTW, which program is not automated? Isn't that the point?), so since they were using a bot they were not authorized to use the site. The other part of the unauthorized access is a little more blatant - hacking into the sites and networks to steal source code to see how the companies implemented bot deterrence.

Re:What a lot of work.

[amicusNYCL]

But 25 million would take quite a few years for most people to earn.

It took them 8.

P.S. Did they do anything that was actually illegal?

The indictment (TFI?) lists 43 counts of unauthorized access and wire fraud.

Re:What a lot of work.

[Hurricane78]

Legitimate media is extremely competitive. Want to start a TV station? A Newspaper? Put out a movie? Music?

You mean traditional ones? What do those things have to do with legitimate media?

Re:What a lot of work.

[Anonymous Coward]

So, how is that different than ticketmaster?

Re:What a lot of work.

[geekoid]

So what?
If this is a problem, then the venue can change how they sell tickets. Oh wait, most of them have, and scalping isn't really a problem any more.

These people commit fraud.

Re:What a lot of work.

[osgeek]

I agree that the artist should be able to sell tickets to whomever he wishes for whatever price. It's fraud to misrepresent who you are like the perps did in this case.

I wasn't arguing against that at all.

I was arguing against the notion that letting demand of entertainment determine pricing is some kind of cultural evil... it isn't.

Re:What a lot of work.

[dukw_butter]

"Sellers could cut them out by raising their prices so that demand matches supply."

Ding! Ding! Ding! This is the correct answer. What most people don't understand is that the venues are charging less than people are willing to pay. Demand is greater than supply and so the price goes up. Scalpers are there to correct the situation. The only way to "beat the scalpers" is to price the tickets appropriately, meaning to "auction" off the tickets to the highest bidder. Then, if the performers/venue feel the prices are too high, they can perform another show. This is the way the free market economy works.

Re:What a lot of work.

[nabsltd]

Don't forget too that if every scalped ticket isn't sold, that comes off of the bottom line.

If a scalper was looking to maximize their income and minimize the risk of having leftover stock, they would sell the tickets using a Dutch or reverse auction (or some variation of either).

If the original ticket sellers (Ticketmaster, etc.) would do this, then there would be no scalpers, and no mad rush to get tickets in the first few minutes. I think a good starting price would be ten times the "normal" ticket price for each type of seat, with the bottom price being about 50% of "normal" (but have this price only available for a few days before the event). A little tweaking on this model would maximize revenue for the actual event and completely cut scalpers out of the equation.

Re:What a lot of work.

[smidget2k4]

Excuse me, perhaps not racist, but a vast oversimplification. Saying "fried chicken seems to be a part of a particular black culture" is different from "all black people eat a lot of fried chicken". Sure, stereotypes are nice and comfortable, but they distill complex cultures into a few little talking points. Which can lead to a group thinking they are better because, obviously, we're better than X group who does Y all the time! Which breeds racism.

Re:What a lot of work.

[Arathrael]

I was arguing against the notion that letting demand of entertainment determine pricing is some kind of cultural evil... it isn't.

Isn't it? As opposed to other approaches, it effectively and consistently excludes particular groups from particular events, biasing attendance towards other groups. It's hard to see how that could be a good thing, culturally...

Re:What a lot of work.

[matt20102]

Right on- except that in my town the cops will make you move along if you dare to open your case when you play...

Re:What a lot of work.

[phantomfive]

Start a consulting company. You'll have no problem pulling down $2.5 million a year. YMMV.

Re:What a lot of work.

[osgeek]

I admire your intentions, but the unforeseen consequences are what concern me. By fixing prices, you artificially constrain the growth of a whole industry rather than letting the money flow to where people are perfectly willing to send it. This isn't a cure for cancer we're talking about -- it's football games, rock concerts, and monster truck pulls.

If people want to blow $1000 to buy a ticket to see some idiots throw a ball around then they should be allowed to. The NFL will respond by opening up another 20 teams in areas that normally don't even have football teams. Ticket prices will normalize to something that's more equitable to most folks since availability will increase.

Re:What a lot of work.

[Arathrael]

That was referring to ticketed events, where demand exceeds supply.

I don't think anyone's selling tickets for you to sit in your underwear watching cat videos somehow.

Re:What a lot of work.

[Cytotoxic]

Actually, what this shows is that the pricing system for tickets is broken. These people are providing an arbitrage between two prices that are out of balance (the asking price and the offering price). This is precisely how currency, commodity, stock, etc. markets work. If the ask/offer prices are very divergent, it means that the market is not working efficiently. A properly functioning market will squeeze this gap to a very small number when information is freely available to all players.

If concert promoters want to remove the opportunity for ticket brokers, then they should either raise their prices or add more supply. Even so, ticket brokers should be playing the role of commodity investors, providing predictability and liquidity to the market, the same function they serve investing in wheat futures. As such, their role would actually be useful to all parties. Unfortunately, anti-scalping laws prevent this market from fully maturing and as such limit their effectiveness.

Ticket Masters makes several bucks on each ticket purchase and they have most venues in the US locked up in exclusive deals. I'm sure these ticket brokers would love the chance to step in and take Ticket Masters out of the equation. With an online auction house you'd be able to easily accommodate the demand and you could simply negotiate the wholesale price of the tickets with the promoter. Done properly, you wouldn't even use your own money. You'd allow investors to buy shares in the Dec 12 Brittney Spears concert, and they would basically be setting the ticket price by trading shares in the concert. If they bet wrong, they'd lose their money, but the promoter would have a nice guaranteed revenue stream.

Re:What a lot of work.

[HoboCop]

Seems like the problem is the venue then.. why do they have to have so many crappy seats? If the artists were smart they would play a lot more shows at smaller venues.. so the tickets were not scarce enough to warrant scalping, and the average seat was much better. The arena thing should die. I guess for the lazy pop star that's too much to ask.

Also look at what some artists do by camping out in Vegas. I'm not sure, but I bet they don't have nearly the same problem with scalping, and they have complete control over the venue.

Re:What a lot of work.

[Anonymous Coward]

Sicne you can't seem to see it on a 'small impact' type of situation, allow us to change it a bit to a 'large impact', and see if you get it.

Say X company creates cure for cancer. For whatever reason, only 5 places can produce it, and are only capable of producing 1000 doses of it a day each. They all sell them for $1 per dose.
Now here comes jackass A, who goes and buys the entire supply of it from everyone for $5000 total. They do this every single day. However, they buy it electronically, pretending to be 5000 different people.
Jackass A now has a complete monopoly on the drug. He then turns around and says that he will only sell the doses for $15000 a dose.

There's a reason these situations are illegal. Fraud would be the most obvious one (pretending to be 5000 different people). There are others there. Try to find them. It's not hard.

Re:What a lot of work.

[AmonTheMetalhead]

20 million for 1 million tickets means an average of $20 per ticket, i don't know what prices are on your side of the globe, but over here in Europe, the average ticket price for a big event is around 55€, that's what, 3 times as much?

And yes, we do have scalpers over here too, seeing tickets for big events such as AC/DC or Metallica for instance for 5 to 20x their face price isn't that uncommon....

Re:What a lot of work.

[iamhassi]

"f they pay a group of Chinnese guys USD $0.39 an hour"

do you have a link or email address for these chinese guys? I've been trying to hire some chinese guys for a long time and this sounds like just the ticket!

Re:What a lot of work.

[hairyfeet]

How in the fuck does liking a particular food make someone "better" or "worse" than someone else, except in the minds of the PC police? We southerners LIKE fried foods. hell we even fry Twinkies for the love of Pete, does that make us better or worse than bossy Yankees?

What I was pointing out is that palate differences make for different food choices, that isn't racism, that's biology. Walk into a KFC around the south, you'll almost never see a black person there. That is because to most black folks the particular mix of spices KFC uses taste bland, as I said my band thought it tasted like cardboard. Go into any Popeye's down here and you'll almost never see a white person. Why? Same reason, most of the white folks are Irish/Scottish descent and the Louisiana spices don't agree with us, while the black folks say it makes the chicken flavorful.

But just because some douchebag drew ads in the 1920s with a black mammy eating fried chicken doesn't mean we all have to pretend that we are all the same now. That kind of thinking leads to quotas based on sex, race, and nationality, and stupid abuses of language like "personholes" instead of manholes. I don't see anyone saying we should pretend Mexicans don't use lots of hot peppers in their traditional dishes, or that Italians don't like to use tomatoes in their cooking, do you? So why should we pretend that soul food, which is a tradition passed down for nearly 300 years, doesn't exist? And notice how in the very first sentence it says "see fried chicken"?

Pretending their aren't differences between the races and the sexes is just stupid. It is our differences in cultures and tastes that make us the great melting pot that is the USA. Even in a tiny southern town like mine there are a good half dozen different cultures foods I can sample just by going down the street. What is wrong with keeping our traditional foods? Yes most black folks in the south (I don't know about Yankees) enjoy soul food and most southerners will fry anything. How is pointing out what is common knowledge suddenly racist?

And as for the asshat that modded me offtopic, we were discussing racism and my posts points out the fallacies with screaming racism over cultural differences. But I have more karma than I could ever possibly use, so feel free to waste your mod points. It still doesn't make your PC police bullshit any more right.

Re:What a lot of work.

[dtmos]

Granted, but it's also true that the indictment did not specify the operating overhead of the enterprise (except for some of its payroll), nor its cost of capital. These guys must have had seed money to set up the organization -- how much interest did they pay? It's likely in this case that this information is available to prosecutors, but just not in the indictment.

I think it's likely they used gross profit because (a) it makes the enterprise seem larger, and its indictment a bigger coup for the prosecutors, and (b) it's an easier number to get -- no messy going through rent and electric bill receipts. Criminal enterprises rarely have audited books.

Re:What a lot of work.

[AmonTheMetalhead]

Large scale scalping like wiseguy is still a problem, and quite common, and a crime

Re:What a lot of work.

[Cytotoxic]

Demand-based pricing wouldn't change that ('make things better for everyone?' Are you nuts?) except for the richest. But instead of ability to attend being based on timing and luck, essentially, it biases attendance towards wealth. This would make it worse for many. Further, it would reduce the diversity of those attending. That would be bad, both culturally, and for the artists/teams/etc., if you think about it. It is not a good idea.

I think you are missing the other aspects of market forces. If the prices rise beyond what most people can pay, then that means that there still is untapped demand out there. The reasonable solution is to add more seats and reap the rewards. Surprisingly, this is exactly what happens. I saw the Red Hot Chili Peppers back in 1990 in a small venue with about 300 people. They rocked! Good luck doing that 5 years later. They moved to venues with 20,000+ seats. Even bigger acts play multiple shows in 100,000 seat football stadiums.

I don't know how much the Red Hot Chili Peppers made for the show in 1990, but I'll bet it was a lot less than they made when I saw them a decade later. The show in 1990 was a lot better though. I guess the price they received didn't correlate with the quality of the product as much as it did with demand.

Re:What a lot of work.

[cayenne8]

"I'd imagine that ticketmaster has some sort of rule banning automatic and bulk purchase of tickets. "

But as far as I know...a corporations rules/policy are not law and breaking a law is the only way you can (should) be taken court, right?

Like if you don't allow people with dirty shoes to come in your restaurant. You have a sign saying just that policy on the door. I walk in with muddy shoes anyway. You can then refuse service to me...and have me leave. I cannot, however, be arrested for walking in with dirty shoes. What if I put baggies on them so that the restaurant owners couldn't see my shoes were dirty? Heck, someone might go ahead and seat me and let me eat there. If on the way out, I took off my shoe covers...would I be arrested? I've still broken no law...only a corporations policy.

Re:What a lot of work.

[ottothecow]

Well, this case seems to be bringing them to court for things that are definitely illegal (hacking, etc.) but there are many ways that violation of a company's policy could still get you into court (and really, they have not been convicted yet...maybe they are being dragged into court now but will be found not guilty).

In your example, if I kept coming back and trying to eat in your restaurant with my dirty shoes after you had put up additional signs and taken extra precautions (captchas, etc) that I then circumvented, you would definitely have cause to call the cops. Many acts of fraud are actually perfectly legal except for the fact that they are fraud--that is, your crime is fraud and not telling lies, trickery, and making promises that are to good to be true.

In this case, I can see how the first eight elements of fraud would easily be argued in court...the only one I can't put a finger on is the 9th that states that Ticketmaster would have had to suffer damage. Lawyers will probably fill that in with something...and while the judge may not agree, it sounds like they have enough of a case to justify going to court.

Re:What a lot of work.

[ooshna]

When you live in Cleveland Ohio and every Popeye's and KFC has a 90%+ black costumer base would it still be racist to say that in Cleveland black's love thier fried chicken more than white's?

Re:What a lot of work.

[TheSync]

A rise in prices will price out some people who could have afforded the lower fixed prices

A rise in price is a signal to entrepreneurs to produce more (in this case play the band in bigger stadiums, more nights, more tours, etc.)

That is why command economies fail, there is now way in a commanded economy to calculate the incredible web of supplies needed for production without price signals.

Re:What a lot of work.

[DahGhostfacedFiddlah]

Simply changing "tickets" to "cancer cure" doesn't change the answer to the question "what laws were broken".

If it's illegal to use a pseudonym while buying cancer cures online, then your fraud charge would be accurate in that situation. If it's not illegal to use a pseudonym while buying tickets online, then what's the problem?

Re:What a lot of work.

[psithurism]

Or screw either of those things and go make $25mil scalping!

Re:What a lot of work.

[stuckinphp]

Is that a troll? Hard to tell.

Anyway, I want to know why recaptcha doesn't update their id mappings constantly? It would be very trivial to randomly shuffle them over time.

This 'flaw' is pretty huge and its kind of retarded it even popped up. You can crowdsource this type of thing very easily to break it.

But then again, its not very hard to crowdsource breaking captchas in real time so my point is kinda moot.

Re:What a lot of work.

[peetm]

Me too - but I'd also like to know how they built this database - automating the responses.

Re:What a lot of work.

[Hognoxious]

I asked about what they did, not what they were indicted for. "Unauthorized access" is remarkably vague. Brings to mind the Megan Meier case.

Re:What a lot of work.

[Hognoxious]

Ah, I've met coders like you - ones who refer to "variable constants" and "constant variables". They're fucking idiots too.

Re:What a lot of work.

[Arathrael]

*sigh* Don't be such a tool.

http://en.wikipedia.org/wiki/Variable_pricing

Read the first two sentences. Then shut up.

Re:What a lot of work.

[amicusNYCL]

For the unauthorized access, using a bot to buy tickets constituted unauthorized access because the polices of the site specifically excluded bots, and they also hacked into a couple networks to steal source code and identify the countermeasures being used. I didn't read up on the wire fraud charges.

There is a far easier way to 'break' CAPTCHA

[sodul]

A friend of mine mentioned when the technology just came out that you could just setup a 'free pr0n' website and you would get a horde of humans entering the letters for you for real cheap.

Re:There is a far easier way to 'break' CAPTCHA

[Anonymous Coward]

Sure, if you've no moral qualms about what you're doing.

Re:There is a far easier way to 'break' CAPTCHA

[Anonymous Coward]

Did he pass that off as his own idea? Because I think it's not

Re:There is a far easier way to 'break' CAPTCHA

[jonbryce]

That probably works for creating hotmail accounts to send spam from, but not if you need to solve hundreds of thousands of capatchas in the space of a couple of seconds at 7am when the tickets are released for sale.

Re:There is a far easier way to 'break' CAPTCHA

[Civil_Disobedient]

Only works if you can convince a non-trivial number of people to enter in the CAPTCHA at a specific time corresponding to when the tickets going on sale. There's about a 5 minute window to hammer the servers (though some really big acts can sell out in under a minute).

The trick I thought of would be to tell users that new photo/video galleries are posted at 9 or 10am (the time tickets go on sale).

Why is it illegal?

[Taco Cowboy]

They didn't rob the bank.

They didn't print fake dollar bill.

Every single dollar that they paid good money for purchasing the tickets are REAL money.

What's illegal about what they have done??

Re:Why is it illegal?

[bguiz]

Q:

What's illegal about what they have done??

A: Nothing

IANAL, but I think parent is right in saying that these guys have actually not done anything illegal

The issue here is more of morality: while they didn't actually scam anyone per se, as a direct result of their actions, thousands of legitimate concert-goers had to pay more for their tickets than they should have needed to. In other words, they were sneaky and manipulated all these people into paying them more $.

...

OTOH, it is possible that the ticket vendors had some sort of legal agreement that you had to "Agree" to when purchasing the tickets that tickets were for personal usage only, or cannot be resold, etc. In such a case, what these guys did would actually have violated some rules on A) a large scale, and B) with malicious intent, and possibly C) fraud.

Re:Why is it illegal?

[twisteddk]

It's illegal because the artist, locationowner and distribution company are the ones supposed to make the money off the tickets, so a fixed price is agreed upon, and the royalties etc. are contractually determined in advance. Anything more is "scalping" because the scalper gets the money rather than the artist, who is usually the recipient of up to 50% of the ticket sales.

So if 20.000 tickets are sold for $50 each, thats $1M, of which half goes to the artist. Simple math. BUT, if 1000 of those tickets are sold for say, $100, by the terms of the contract, the artist is supposed to get half of 19.000x$50 + 1000x$100 and who pays the extra ? 'coz the scalper sure doesnt. Thus he is in breach of a few copyright holders laws (at least in Europe, not sure about the US, but judging by the latest ACTA docs leaked, I'm assuming it's much worse in the states). So it IS illegal. WHY, on the other hand is a different matter. Some people might argue that free enterprise means that pricefixing shouldn't happen, and that the scalpers actions are a part of the normal market mechanisms. But in actuality, it's the copyright laws that makes it illegal, not the pricefixing (and had this been gas or food sold, it'd probably be legal)

In most countries, scalped tickets gets electronically revoked. So even buying a scalped ticket is often a gamble.

Re:Why is it illegal?

[AmonTheMetalhead]

Impersonating a person, resale of tickets where (commercial) resale is illegal, fraud, illegal use of computer resources (botnets) and pissed of alot of people who actually wanted to buy tickets but were unable to.
When AC/DC toured last year these asses their botnets overloaded the official ticketsale sites preventing any real customer to even access them, in Belgium the sites were unreachable 2 days before the sale even started.
If i had my way, ticket scalpers would be scalped for real.

Re:Why is it illegal?

[peragrin]

that's just it they paid retail for tickets so the artist and the stadiums made the money they thought they were going to anyways.

scalpers usually buy tickets at normal prices and then sell them for more. now sometimes they do under cut the theaters or staduims but most of their money is on big games. were the $30 cheep seats suddenly become worth $70 or more.

Re:Why is it illegal?

[MichaelSmith]

Belgium the sites were unreachable 2 days before the sale even started.

And what makes you think that was due to automation? Don't forget we ourselves have taken down a server or two in our times.

Re:Why is it illegal?

[asdf7890]

What's illegal about what they have done??

There system obtained access to resource (the tickets) under false pretences (pretending to be different individual people rather than one organisation). That, I believe, is fraud.

Anyway, the poster you replied to stated "legitimately", not "legally". In common parlance "legitimate" covers both "legal" and "moral", and taking advantage of people in this way is generally seen as NotTheDoneThing. If you had to pay twice as much (or sometimes it can be several times as much) for something that you wanted simply because a group like that had gamed the market, would you be happy to pay up and consider that everything was proper and above board?

Re:Why is it illegal?

[AmonTheMetalhead]

Sure, it's possible it was just a high number of people trying to access the site.... 48 hours before ticket sale starts till the moment the tickets were sold out, but I'm kind of skeptical of that, given tickets were being offered on other places within seconds of sales beginning for 10 to 20x the official price

It makes sense in a way, for some concerts you can be pretty damn sure you can resell tickets for 5 to 25x the official price easily, couple this with a lack of ID check at the venue's, the fact that it's a legal gray area in most places and the lack of motivation for ticket resellers to actually block this (they still get their money) it's unlikely this will change soon, and if you have the skill to exploit the system, you can make a lot of money very fast, as evidenced by TFA

And it's not like you can't prevent this, there are ways you can do that, and they're pretty damn easy.

Re:Why is it illegal?

[HungryHobo]

Copyright?
Where the hell does copyright come into this?
They're not printing extra tickets.

So if 20.000 tickets are sold for $50 each, thats $1M, of which half goes to the artist. Simple math. BUT, if 1000 of those tickets are sold for say, $100, by the terms of the contract, the artist is supposed to get half of 19.000x$50 + 1000x$100 and who pays the extra ?

Nobody.
and that's how it should be.
If the artist wanted $50 per ticket rather than $25 per ticket then they should have sold them for more in the first place.

If I make a game, print 20,000 disks and sell for $50 each, thats $1M and if I've got a particularly lucrative contract as the developer I get half. Simple math.
BUT, if 1000 of those tickets are bough by someone, I get my 250K cut and then they sell those games second hand to someone else for $100 each and make a profit then that's their buisness.
I've already got my cut.
I have no right to a cut of their second hand sales.

If I wanted more then I should have charged more in the first place.

Re:Why is it illegal?

[Anonymous Coward]

Just like millions of people every year pay more for computers than they should have needed to, if resellers didn't buy cheap and sell high at every step of the computers' way from the Chinese factory to the consumers home.

That's simply the way the market works.

Re:Why is it illegal?

[jabberw0k]

Horsefeathers.

All the parties have already made their money on the tickets.

The "scalper" only makes money by selling a scarce item at what the market will bear. Had the tickets been priced higher, he could only lose money. Besides, it's a dicey business because if as a "scalper," you set your price too high, you're gonna lose everything.

Pure supply and demand. "Scalping" is the best proof of free markets anywhere.

Re:Why is it illegal?

[krou]

They like broke the terms of service of the site in question, which is probably where the illegality lies.

Re:Why is it illegal?

[Anonymous Coward]

Wait, you want people to check ID for entry to a concert of game? Ignoring any privacy concerns, do you really want to double or triple the time spent in line to get into these places? Given online distribution these days, I don't really understand why ticketmaster et al don't have some kind of internal "scalping" setup where they sell as many tickets at peak prices early then slowly lower them if the inventory is higher than it should be historically. Maybe keep a few in reserve for high price last minute sales. Come to think of it, this is exactly what airlines do for ticket sales and the same expiration issue for concerts exist for them.

Re:Why is it illegal?

[Anonymous Coward]

So,

        Please show me a Federal or State statue that says I can not pretend to be another, except to the Police or other government agents.

Re:Why is it illegal?

[rinoid]

Gee, smells like unbridled capitalism to me. But what would I know? I'm a socialist/libertarian.

Re:Why is it illegal?

[ArsenneLupin]

Indeed, ticket scalping is almost as old as humankind, and illegal for almost as long. In the olden days, ticket scalpers just bought their tickets in normal brick-and-mortar pre-sale places, and then sold them on the day of the event to the people in the queue. Many people are poor planners, don't get tickets in time, and are quite "happy" to buy them at over-inflated prices from the scalpers.

But the thing is, if "all" the tickets hadn't been scooped up by scalpers, there would still have been legitimate tickets available through normal channels even at a date quite close to the event, so the "poor planners" could have gotten them for face price.

What is weird however in the current online case, is how is it possible that the operators didn't notice the scam for full eight years? It must have been a pretty large-scale undertaking, which should have shown up even with simple traffic analysis...

Re:Why is it illegal?

[Anonymous Coward]

some sort of legal agreement that you had to "Agree" to when purchasing the tickets that tickets were for personal usage only

A sophisticated way of saying, "yet another fucking restriction on the doctrine of first sale".

Re:Why is it illegal?

[Anonymous Coward]

"while they didn't actually scam anyone per se, as a direct result of their actions, thousands of legitimate concert-goers had to pay more for their tickets than they should have needed to."

Or, the face value of the tickets were lower than what many concert goers were willing to pay. It's called capitalism. The market sets the price of goods & services. If you don't like it, tell your boy Obama to take over Ticketmaster and give it to his union cronies.

Re:Why is it illegal?

[somersault]

Then simply don't buy the overpriced tickets, and these guys will go out of business very quickly. If people are stupid enough to pay the hiked up prices, why shouldn't these guys do it? I fail to see anything illegal in what they're doing any more than if a supermarket buys up a whole bunch of coffee or rice and sells it on to their customers at a higher price, or McDonalds and Burger King making insane profits on their drinks.

Re:Why is it illegal?

[Mattskimo]

Breaking a ToS is not necessarily itself illegal. It is grounds for the stadium to refuse you admission but they are allowed to do this regardless, for any reason or often for no reason at all. It would be like buying currency on a MMO, generally against the ToS and once could reasonably expect account suspensions or bans to be dished out but doing so is not a criminal offense.

Re:Why is it illegal?

[MindlessAutomata]

OK, Mr. "libertarian," just who you do you propose stops this scalping? The government?

Re:Why is it illegal?

[mikael_j]

Well, if the supermarket doesn't just buy up "a whole bunch of coffee" but is basically waiting at the pier when the ship loaded with coffee arrives and buys all of it although they only needed 0.1% of it for themselves then it is dishonest and they're clearly trying to exploit others.

Also, this is a classic case of where "voting with your money" just doesn't work because the profit margins and the demand are both so high that even if you could get say, 80% of the prospective customers to agree not to buy from scalpers you'd still be looking at them selling a boatload of tickets, and since they're pretty much the only game in town they can raise prices to compensate if the demand gets too low (thus creating an artificial supply shortage), if you want a ticket to Springsteen you're just gonna have to pay those $500 that the ticket just went up to, it's not like they're just gonna give the tickets back. The only times scalpers sell tickets at or close to the original price is in situations where the demand was very low (happens sometimes with open-air festivals because those often release tickets several times instead of all at once so people aren't as inclined to purchase them from scalpers) and even then they'll wait until the very last moment since they're probably already making a profit, they're just trying to maximize their profit.

/Mikael

Re:Why is it illegal?

[Mattskimo]

Socialist libertarian? Isn't that a bit like being a christian athiest?

Re:Why is it illegal?

[aminorex]

Guys like this are why we have fascism.

Re:Why is it illegal?

[Doug Neal]

Not really.

From the same page: "Left-libertarianism combines the libertarian premise that each person possesses a natural right of self-ownership with the egalitarian premise that natural resources should be shared equally."

Re:Why is it illegal?

[dziban303]

Failing to follow the terms of service of a website is not a criminal act in itself. A website is not Congress or Parliament or El Presidente, and they do not get to create any laws that have any effect outside of their own website. Sure, they can ban you, but they can't arrest you.

Re:Why is it illegal?

[EdelFactor19]

1. Explicitly prohibited by the licensing agreements of the tickets
2. Explicitly prohibited by the terms of the sellers (both the distributing retailer and the originating party)
and (granted this is not a truly legitimate reason as its speculative, but more of a motivation)
3. Because 99 times out of 100 scalping is not done through a legitimate business, with no papertrail (i.e. cash only) and all proceeds becoming unreported income, thus escaping the clutches of uncle sam and taxes.

I for one agree in one sense, that their needs to be competition to make TicketMaster imparticular stop price gouging. I think it is beyond egregious that while the ticket may cost "$78" it actually costs ~100$ to buy after they add in a 15$ convenience change (convenience for what?), sales tax, and then another charge to get your ticket printed (charge ranges from a couple dollars for online printing, to several dozen for express shipping), with no option being free. Oh and no refunds, I love that one too (although allowing refunds to large extent would likely only further encourage scalping... can't sell it for crazy markup? return it and have no risk at all)

To me this screams of two things. One, misrepresentation of costs. If you can't physically acquire the ticket for less than FULL_COST = (COST + CONVENIENCE_CHARGE + OTHER_FEES) than they shouldn't be allowed to ever quote a price for that ticket at less than FULL_COST. (For what it's worth I think cable and telco industries should be held to this same standard, and not be allowed to remove various 'this isn't a tax/government fee but we present it separately as though it is one' costs as well as cost for the minimum needed equipment to receive the service (i.e. if you have to rent at least one cable box per month from them to receive anything they should have to put that price, at least of the cheapest box, right into the advertised monthly rate)

Two, and the real problem I have with scalping from a more ethical standpoint, is that it is not done in a true market. People are using dubious means to acquire tickets ( a limited consumable resource ) to an event, and then trying to turn around and sell it again at a vast markup providing no service or benefit to the customer. All that it does is raise costs to end users and decrease availability. IANAL but if this were done in the stock market it would sound a lot like pump and dump, or in banking being a loan shark. If they want to distribute tickets, form a legitimate business and secure a contract to distribute tickets.

Re:Why is it illegal?

[Anonymous Coward]

Q:

The issue here is more of morality: while they didn't actually scam anyone per se, as a direct result of their actions, thousands of legitimate concert-goers had to pay more for their tickets than they should have needed to.

Sounds like ticketmaster's own scalping service, stubhub.

Re:Why is it illegal?

[Rolgar]

Some teams in the big sports leagues are moving toward auctioning off the best seats in the house, typically as part of a season ticket package, basically to claim some of the profit the scalpers have been making. If they do it right, the scalpers won't be able to participate because their margins will get too small to make it worth the risk up buying their product up front.

Frankly, I think the scalping should be legal. After all, the scalpers are agreeing to take the risk and guarantee the businessman that his tickets will sell even if nobody eventually shows up to watch the event. If the people hosting the event are upset because somebody else is making a profit that they could have made, then they should figure better ways to maximize the price of every seat in the house.

How to do it: Have a silent auction for all of the tickets to the event. After everybody has selected their price, the tickets are assigned to the bidders in order of highest bid. This should maximize the price for every ticket and total ticket sales, because people that aren't willing to pay the current $20 price for an otherwise empty 'nosebleed' seat might be willing to pay $5-10 for the privilege of filling a seat nobody else wants for $20.

Re:Why is it illegal?

[somersault]

Well, if the supermarket doesn't just buy up "a whole bunch of coffee" but is basically waiting at the pier when the ship loaded with coffee arrives and buys all of it although they only needed 0.1% of it for themselves then it is dishonest and they're clearly trying to exploit others.

What are you talking about? Their job is to sell stuff. If they can sell 100% of it, then they need 100% of it.

Also, this is a classic case of where "voting with your money" just doesn't work because the profit margins and the demand are both so high that even if you could get say, 80% of the prospective customers to agree not to buy from scalpers you'd still be looking at them selling a boatload of tickets

That is people voting with their money. If they are stupid enough to value the tickets to a live concert so highly, then that in fact shows the "real" value of the tickets to the fans.

Re:Why is it illegal?

[Chris Mattern]

OK, Mr. "libertarian," just who you do you propose stops this scalping? The government?

Your question presupposes that it is necessary, desirable or even possible to stop it. Attempts to stop tickets from selling at a price people are willing to pay for them is like trying to stop the tide from coming in. The only question is whether the price will be charged by the original ticket seller or a scalper.

Re:Why is it illegal?

[MrKaos]

Many people are poor planners, don't get tickets in time, and are quite "happy" to buy them at over-inflated prices from the scalpers.

I was waiting for months for Faith No More tickets to go on sale. I wasn't sure when they would. I missed out by two days and the concert was sold out. I was so fucking pissed off when I checked on e-bay to find certain sellers had > 10 tickets for sale at more than twice the price they were being sold for from the agencies.

Before ticket sales via the net I never missed out on tickets, now I'm almost certain I'll never get the tickets I want because the scalpers are so effective. Who has time to watch the box office everyday for every concert you want to see, it's so time consuming. Give me the software so I can see the bands I want to see.

Funny story, I went to see Tool back in the late 90's and the scalpers were out in force selling tickets to a 'sold out' show. About 15 minutes before it started the shutters of the box office were flung open and tickets were on sale. People swamped it, leaving the scalpers with bunches of tickets in their hands.

One of them ran up to a friend of mine and said 'Floor tickets to Tool, $5, how can you go wrong'.

Maybe all concerts should be sold this way, leaving a certain amount of tickets available from the box office on the night just to keep the scalpers under control.

Re:Why is it illegal?

[Reece400]

Yup, this is why Ticketmaster is going for 'paperless' tickets for the premium seats now. You need you credit card and ID to get in, so no reselling. Unfortunately like DRM this is a pain in the ass for the rest of us, no buying tickets for gifts, everyone who you bought tickets for has to show up with you to get in, and god only knows what you have to go through if you lose that credit card and have it replaced with a different number!

Re:Why is it illegal?

[EastCoastSurfer]

You're assuming there is something wrong with scalping in the first place. These evens are all optional to attend. If someone pays more for a ticket than face value why is that a problem? The scarcity of the ticket drove the price up and the person who paid did their own personal value calculation for the ticket.

If you're for banning scalping do you also want to ban people who sell tickets below face value? I routinely wait till a couple days before an event and pay less than face value for tickets (if you're willing to go to a weekday sporting even for example). Should that also be stopped?

Re:Why is it illegal?

[AmonTheMetalhead]

Yes, i want ID checks at the entry, the privacy implication is minimal, and frecking worth it if it kills scalpers.

The way you suggested would also stop me from going to see concerts, because it's not a fair system, it would prevent a lot of fans from actually being able to see their idols because they won't be able to afford it, there is a reason why the face prices are fixed.

Re:Why is it illegal?

[olliM]

The issue here is more of morality: while they didn't actually scam anyone per se, as a direct result of their actions, thousands of legitimate concert-goers had to pay more for their tickets than they should have needed to. In other words, they were sneaky and manipulated all these people into paying them more $.

The underlying problem is that the original ticket price is too low: if they were sold at fair market price, there would be no opportunity for scalping. The reason of course is that the point of concerts is more to promote the sale of cds and such, not so much making money directly. It would not be good pr to only play for the rich.

Re:Why is it illegal?

[EastCoastSurfer]

But the thing is, if "all" the tickets hadn't been scooped up by scalpers, there would still have been legitimate tickets available through normal channels even at a date quite close to the event, so the "poor planners" could have gotten them for face price.

How do you know this? If there would have been legitimate tickets left on the day of the event then that would lead me to believe that the scalpers are going to have a hard time selling all their tickets at increased prices. The whole reason the scalpers can do what they do is that the ticket price was set too low to begin with and more people wanted to attend (and pay the original price) than there were tickets. The poor planners still would not have a ticket.

Re:Why is it illegal?

[EastCoastSurfer]

You missed the point. The scalper did you a service by even giving you the chance to see the concert. If there were no scalpers and every ticket sold was legit then there would be no tickets on ebay and your action of missing the ticket sale means you have zero options to attend.

Would you prefer that the concert simply have been priced at the scalpers prices from the get go? At least that way there might be some tickets left when you finally got around to checking the box office.

Re:Why is it illegal?

[BetterSense]

If it's possible to make money by scalping tickets, then clearly the tickets are underpriced. The scalpers in that case are providing a valuable service of holding back inventory for those that are willing to pay a little extra for the opportunity to purchase a ticket closer to the event date.

Re:Why is it illegal?

[Anonymous Coward]

Look, if you're doing something that makes the average Hannah Montana fan want to kill you (and not in a nice way). Then there is a good chance it is or should be illegal.

Re:Why is it illegal?

[AmonTheMetalhead]

Okay, let's try this simple car analogy, this is slashdot after all:

Imagine you need to buy new tires for your car, and there is only one chain that sells tires at a reasonable (fixed) price, so you go to their shop, only to find an organization swamped their store preventing you access & bought the whole supply so they no longer have any tires.
Now, you and a lot of other people still need tires, so you check online, and lo & behold, the tires that normally cost $25 at the official chain now suddenly are sold for $500, you now have a choice, do you buy these or do you give up on riding?

Off course, this analogy doesn't cover the fact that the organization committed several acts of fraud & other nasties (read TFA), but it does illustrate the core issue, is it fair that an organization buys out a stock knowing fully that any individual doesn't have the necessary means to compete with them for the same item, the organization is so big, they literally block the entrance to the chain for individuals (in TFA they mention a game where they had 824 of the 1000 available tickets).

Re:Why is it illegal?

[MindlessAutomata]

No, no, no, the person I'm responding to seems to dislike scalping, unbridled capitalism, then talking about how they are a "socialist/libertarian." If they want to outlaw scalping... well, what kind of libertarian is that?

I'm right with you on scalping. The buying-tickets-en masse scalping is really shitty but tickets shouldn't be treated differently from any other good! I always complain about scalping laws.

If scalping is a problem, think of an alternative to tickets.

Re:Why is it illegal?

[QuantumRiff]

Or even easier..When your site is setup to limit how many tickets can be bought per session or person, change it to limit how many tickets can be bought per credit card. You really don't think these guys had 5,000 credit cards to buy 20,000 tickets at a time, do you?

Seems it would have been trivial to block by ticketmaster, if they ever cared.

Re:Why is it illegal?

[sunking2]

Consumer fraud and price fixing are a big part of what Attorney Generals in states look into. Not reading the article I'm going to say there are probably some tax issues as well. I'm also going to say that they are probably breaking some of the stipulations of the contract that the original sellers place on any tickets that are bought. Like it or not (most agree this is even ludicrously high), the original ticket issuer has set the fair market value for ticket.

Re:Why is it illegal?

[Maniacal]

I would start up a tire company, make the tires, and sell them for $400. I would undercut the tire "scalpers" and make the other guy feel stupid for selling something for $25 when it was clearly worth $400-$500.

Re:Why is it illegal?

[Enry]

I think you missed the point.

The scalpers are scooping up tickets and skewing the price. MrKaos pointed out that out:

Before ticket sales via the net I never missed out on tickets, now I'm almost certain I'll never get the tickets I want because the scalpers are so effective.

With scalpers in action, he's unable to get tickets anymore and is forced to use scalpers. Without them, he's able to get his tickets directly even a few days after they went on sale.

Re:Why is it illegal?

[twidarkling]

You missed the point. The scalper did you a service by even giving you the chance to see the concert. If there were no scalpers and every ticket sold was legit then there would be no tickets on ebay and your action of missing the ticket sale means you have zero options to attend.

Logical fallacy present. You're assuming tickets would have sold at the same rate whether scalpers were present or not. This is pretty laughable (appeal to ridicule *points and laughs* ). If there wasn't monetary interests being indulged, you'd have much slower movement of tickets by people with legitimate interests involved. This is patently obvious simply because there's fewer people involved. Scalpers create *artificial* demand. They are the antithesis of free market. After all, they don't care if they sell ALL their tickets, just that they make a profit, so the more they buy, the higher they can set *their* per ticket price, and the fewer overall they'd have to sell. Scalpers don't provide a service, they break the system.

Re:Why is it illegal?

[Enry]

Uhh, ok

Re:Why is it illegal?

[EastCoastSurfer]

With scalpers in action, he's unable to get tickets anymore and is forced to use scalpers. Without them, he's able to get his tickets directly even a few days after they went on sale.

If scalpers are able to sell the tickets at the increased price it means that demand exceeded the supply of tickets at the fixed price. Thus, if all tickets were sold at the fixed price there would not be any tickets left soon after the tickets had gone on sale. You're assuming that if there were no scalpers there would magically be tickets left at the low, fixed price days later. The fact that the scalpers can sell tickets at such a high markup tells me that the original lower fixed price was too low and that all tickets would have sold early on.

Re:Why is it illegal?

[MrBippers]

thousands of legitimate concert-goers had to pay more for their tickets than they should have needed to

That assumes that these tickets wouldn't just have been bought by other scalpers before the actual even going public did. Certainly these guys weren't the only ones in the game, they just happened to be the quickest.

Re:Why is it illegal?

[AmonTheMetalhead]

The problem is, the amount of resources to make said tires (in this case, the artists) is limited, if they have already committed to perform x times in country y in year z, it's very unlikely you'll get them to come back to perform yet another number of concerts in country y in year z

Basically, you'd set up a company & find out that there's no resources available (due to lack of funds, the resources being signed up with other companies,...), so you'll have no tires to sell, or maybe some tires nobody wants

Re:Why is it illegal?

[dintlu]

Scalpers are rent-seeking middlemen who don't add any value to their product.

Supermarkets and McDonalds and BK all add value to the products they resell, either by assembling them into individual servings of bulk product, or by presenting their products for sale with many other options. Scalpers, in contrast, push people out of the ticket-buying process using unfair automation tactics (in violation of the first seller's TOS, typically), then relist those tickets at higher prices for their own personal gain, taking advantage of people's desire to consume a limited resource to earn money for themselves. Scalpers are a broken window, a drain on society. Their "business" is fundamentally unfair and if it isn't illegal, it should be.

This "vote with your dollars" bullshit doesn't work in the real world.

Re:Why is it illegal?

[Fujisawa Sensei]

The only reason is it illegal is because it makes Ticketmaster realize they aren't charging enough for the tickets. The money those guys made, is just revenue lost by Ticketmaster.

Re:Why is it illegal?

[eln]

There's no real problem with small-scale scalping. The problem with these large-scale operations is they artificially create scarcity by buying up every available ticket. A ticket that you could normally go up to the window and buy at face value is unavailable to you unless you pay inflated prices because the scalper has bought every ticket. They're inserting themselves as a middleman in a market that needs no middleman, and making things cost more for everyone else.

Re:Why is it illegal?

[newdsfornerds]

They violated the terms of sale, at very least.

Re:Why is it illegal?

[newdsfornerds]

Scalping is too good for them. They should be disemboweled while being RickRolled.

Re:Why is it illegal?

[jittles]

The reason that scalping is illegal is NOT because the act of selling tickets at the highest possible price is illegal. It's because its very hard for the purchaser to know whether the ticket is legitimate or not. Add to that the fact that the scalper is almost impossible to track down and that makes it very easy for someone to be dishonest. Not to mention that as a cash business its very easy for them to avoid paying proper taxes.

Scalping is illegal for your protection and the protection of tax revenues more than anything else.

Re:Why is it illegal?

[AmonTheMetalhead]

Not just revenue lost by Ticketmaster (actually, i doubt that, because artists will also impose an upper limit on ticket prices) and less money spent on merchandise.

Re:Why is it illegal?

[smidget2k4]

I'm sorry you live in North Korea. How's the weather?

Re:Why is it illegal?

[geekoid]

Trying to get into other peoples accounts, Impersonating other people to commit fraud.

Re:Why is it illegal?

[smidget2k4]

Here is another one.

Re:Why is it illegal?

[ottothecow]

Small scale scalping is not at issue...large scale scalpers like these guys however are gaining access to the tickets fraudulently and doing all sorts of other behavior that is frowned upon.

Big sellers like this are perfectly capable of buying far more tickets than they can sell (if the event was already close to an equilibrium price) and if they can't unload them, everyone is screwed. Fans get screwed because they can't go and bands often get screwed because they have a smaller/less excited audience (they still get all their ticket returns...though they often are not that high). Also, there are situations where you might rather push your demographic in the opposite direction of money. If you are putting on a show and know that it will sell out but that your most die hard fans will not be able to afford the equilibrium price, you can take other approaches to the tickets (assuming you actually care about your performance rather than maximizing your personal profit). Forcing long waits in line and other similiar tactics (such as...who has time to hammer the ticketmaster website when other people are working) will allow people with less opportunity cost on their time to buy your tickets rather than just people with money.

Sure, some of these people will then realize a gain on their time waiting (or pressing f5) by selling it to the more wealthy person who couldn't wait around but it still provides a good option for the normal high school kid (you know...the one whose parents *didn't* spend hundreds of dollars to take a 5 year old to see miley cyrus) to attend a show that they would not have been able to attend on monetary price alone. Large outfits like this use fraud to cheat the online ticket queues and attempt to corner the market....price fixing is not a good thing.

Re:Why is it illegal?

[Anonymous Coward]

finally, someone out there with the right idea. Put-up-or-shut-up is the name of the game. You cannot come whining to your mom because you played with some kids using your ball and bat and did not win the baseball game. Get better at the game and pick the better kids to play with, or continue to be the owner of a ball and bat and still lose games.

Re:Why is it illegal?

[geekoid]

The idea of 'scalping' being a crime is stupid, no doubt. If I purchase item and want to resell them, then it should NOT be a crime. IT's a BS crime that came into being because ticket seller want to retain their business model, and people to lazy to get their ass to a line in the morning whined that other people got there first.

Meat space scalping is a lot harder to do and people have implemented simple methods to minimize scalping.

These people committed fraud in order to be able to acquire tickets, that is different.

Re:Why is it illegal?

[somersault]

What is the purpose of that analogy? Being an asshole is not the same thing as breaking the law, and if the market will pay $500 for tyres, then it's their own fault. However they probably won't, and so the scalper in this case would have to lower his prices to more reasonable levels before people start paying.

Re:Why is it illegal?

[tompaulco]

The scalpers in that case are providing a valuable service of holding back inventory for those that are willing to pay a little extra for the opportunity to purchase a ticket closer to the event date.
However valuable that service may be, it is not a service that is allowed under the business model of the ticket vendors. Therefore, whether it is illegal or not, it is certainly wrong.

Re:Why is it illegal?

[Dr. Evil]

Scalpers create the scarcity.

Venues compete on price, location and other stuff. This brings prices down. When scalpers step in, the venue has already been locked in. There is no more competition.

If the band or the label were to scalp, it would create a lot of bad blood. If the venue were to scalp, nobody would play there. The practice is so negative, that venues who actively discourage scalping get better acts.

I'm not a big believer in passing more laws, but it should be easy to create laws saying that advertising a ticket for more than 150% of the list price is "Scalping". Enforcement is hard, but having the laws on the books can at least discourage it from being done openly. Venues often spend a lot on having doormen looking for scalpers, offering tickets at the door and other tricks to stop these guys.

As for why it shouldn't be illegal to charge less? it's a fictional problem. You don't have people bidding down the prices of tickets before an event.

Re:Why is it illegal?

[FatSean]

That's a long-winded explanation of a remarkably simplistic observation.

The artifical scarcity produced by the scalpers who make it harder for people to find the tickets is important.

Isn't this what TicketMaster does in the real world? Buys out the box office and marks up the tickets?

What's good for the goose...

Re:Why is it illegal?

[geekoid]

"The problem with these large-scale operations is they artificially create scarcity by buying up every available ticket"
So?

A) Don't buy from them if the price isn't worth the value.

B) There are simple methods the venue can use to all but eliminate scalping.

C) there is nothing wrong with a middleman.

Re:Why is it illegal?

[Enry]

Well, TicketMaster *is* the box office.

Re:Why is it illegal?

[geekoid]

SO what?

I understand that if a product goes on the market,a nd someone buys them all up, I have to go to that person.
Big deal.

Oh wait, I can also choose NOT to go to the event. This is a problem with the venue business model, it shouldn't be a crime.

Why do we need a law so someone can buy tickets days latet? I mean, he should get his lazy fat ass down to the window when it opens.

If it is an event where it's worth the scalpers time, then it will be sold out in minutes anyways. If it isn't worth the scalpers time, then it's not an issue.
Plus most places have a method in place to eliminate or minimize scalping.

If I win super bowl tickets, why should I be a scalper and go to jail for reselling them?

Re:Why is it illegal?

[AmonTheMetalhead]

The problem with (digital) scalping is that the organized scalper will swamp the servers with thousands of connections at once, thus preventing many honest customers from getting a ticket or even to be able to connect to the servers.

It's like if you're wanting to goto a venue to buy some food & finding all the entries blocked by a gang, you can eighter buy the food from the gang for insanely inflated prices, or hope the gang leaves before the stock is gone completely.

Re:Why is it illegal?

[somersault]

This "vote with your dollars" bullshit doesn't work in the real world.

It does work, because if the scalpers put the tickets up to prices that people aren't willing to pay, they will not buy the tickets. We're not talking about basic human necessities here, we're talking about a luxury item. People who buy from scalpers are in fact voting with their dollars.

These guys are parasitic assholes yes, but the people who buy from them are the idiots that are making their "gaming of the system" possible.

Re:Why is it illegal?

[Enry]

You're again ignoring the point - before scalpers got in and scooped up massive numbers of tickets and artificially inflated the price, regular fans were able to get tickets from the box office at a reasonable price for a longer period of time. Since scalpers were able to get large numbers of tickets, the pool of tickets has decreased, thus raising the price.

This isn't a matter of the tickets being initially priced out of their range, it's a matter of a limited supply being artificially manipulated.

Re:Why is it illegal?

[Jtheletter]

If there would have been legitimate tickets left on the day of the event then that would lead me to believe that the scalpers are going to have a hard time selling all their tickets at increased prices.

Exactly, which is why the scalpers will make sure that there are NO TICKETS LEFT so that they become the sole outlet to purchase tickets. This is the artificial demand the previous response was trying to explain. In a scalper's perfect world they would purchase all the event tickets and become the box office themselves and price the tickets to market demand to maximize their profit. Thus they will attempt (in a distributed fashion) to remove all available "legitimate" supply.

Without this external demand force it is possible - but not always true - that the regular demand would be such that tickets would remain available at the box office for face value until the day of the show. This will vary with the actual demand.

The reason why scalpers artificially inflate demand to such a large degree is because of the financial incentive to remove all low-value sellers from the market. Even if an event did not have enough non-scalper demand to sell out, the scalpers would still profit because everyone would have to go through them. Normally this is balanced by the distributed nature of scalpers - they are not organized (for the most part) and act independently but with the same goal. It's like a DDoS on the tickets. With this particular situation described in the article we have a large professional business that actually has the focus and the funds to achieve the individual scalper's ultimate goal: buyout the box office and control all remaining supply.

The answer is not to price the tickets so high as to remove the scalpers - this can't work - the scalpers are making profit on this cycle so they will always have more money available to step in the middle of the transaction. The answer is to remove the scalpers and their artificial demand. Then even if the box office does raise rates to what the market will accept it will still most likely be a lower price than if the scalpers were involved because their artificial demand will be out of the curve.

My suggestion to remove the larger scalping outfits is to simply make it illegal for any single person or business to resell more than 8 tickets to a single event. That would cover just about every regular ticket holder, and if people had a larger group then you have $friend1 sell half and $friend2 sell half. Small time scalpers would still be in the system but full scale operations like in the article would be stonewalled.

And finally, why do I think it's fair to remove the first sale doctrine from scalpers? It comes down to intent - and our society does make a distinction for intent, just look at homicide sentencing with and without proven intent. In this case the intent of scalpers is to profit from legitimate customers and the underlying ticketed event is irrelevant. Whereas legitimate customers are actually trying to attend the event for sale but may need/want to resell their ticket because of external forces. In the latter instance I still believe some price control (like face value plus $5 only) is necessary to keep legitimate customers honest and reduce small-time scalpers. Additionally remove the ability to pair tickets with other items in transactions to stifle the face value ticket + $500 "commemorative program" loophole.

Re:Why is it illegal?

[somersault]

Yep, there are probably plenty of better systems that they could put in place. Even if it was made illegal to scalp tickets, they should still put some effort into the booking system to enforce things better.

You really don't think these guys had 5,000 credit cards to buy 20,000 tickets at a time, do you?

I wouldn't actually put it past them actually.. seems not too much effort to go to when you can make that much money out of it.

And yes, ticketmaster still get their money in the end, so they probably don't actually care.

Re:Why is it illegal?

[AmonTheMetalhead]

And in the mean while preventing others from even getting a chance at buying a ticket.

Don't forget that ticket sale systems work with queues, if these queues get hit by thousands of connections as soon as the sale opens you the individual have less chance to get a good place on the queue or even reaching the servers, no individual can match the connectivity of large scale scalpers and as a result are prevented form buying the ticket at current market value because of this, compare it to a gang blocking access to a venue, you have to wait for the gang to leave, and hope the venue still has anything to sell you, or buy from the gang for the price of a small kidney.

Oh, and they broke the law too.

Re:Why is it illegal?

[BetterSense]

One is not free to invent any business model he chooses and then gripe about how his competition is not "allowed under his business model". That's called having a bad business model.

Re:Why is it illegal?

[AmonTheMetalhead]

I thought it was pretty obvious, the issue is that organized scalping artificially inflates prices and as such prevents people of having a fair chance at purchasing a ticket.

Re:Why is it illegal?

[NewWorldDan]

The problem, as I see it, is that tickets are being sold for other than market value. There's a pretty simple solution to this that maximizes revenue for ticket sellers and makes scalpers largely obsolete: sell tickets via Dutch auction. You still end up with a few people selling surplus tickets shortly before the event, there are always going to be some people who are unable to attend, or are willing to pay a higher price at the last minute.

Other ways to screw over ticket scalpers: add additional dates. Not an option for sporting events, but a lot of concert tours have enough slack in their schedule that they can add an extra date in high demand cities. Some years back, I recall ticket scalpers getting screwed pretty bad when Bon Jovi added a second show here. :)

Re:Why is it illegal?

[dintlu]

It doesn't work, because it's a silly libertarian ideal, based on an incomplete model of rationality.

Calling people idiots because they are either unwilling or unable to mold their behavior to fit your ideal is juvenile, and it doesn't change the fact that your arguments are based on completely unrealistic assumptions.

Re:Why is it illegal?

[jimrthy]

Like it or not (most agree this is even ludicrously high), the original ticket issuer has set the fair market value for ticket.

And there you have the basic misperception of the Central Planners in a nutshell.

Central Planners can never set "fair market value." Consumers do that by voting with their wallets.

If they're willing, on average, to pay $1000 for a peanut, that's "fair market value." If they expect 1000 tons of peanuts for $1, that is "fair market value."

The seller can "set" whatever selling price he wants. If he sets it too high, people won't buy. If he sets it too low, "scalpers" will make up the difference. Consumers decide what they're willing to pay, and that's subject to change at a moment's notice, for any reason that appeals to the consumer.

That is why Central Planning and government regulation have always failed and will always fail. All the economists' rocket science computer models just cannot keep up with the chaotic dynamics of the free (in this case, black) market.

Re:Why is it illegal?

[geekoid]

When talking about scalpers, I agree with you; however these guys allegedly committed fraud in order to get over 1 million tickets.

If something goes on the market, I see nor reason why someone should be prevented from reselling. If the venue doesn't like it, only allow for tickets to be sold at a time. If you are a fan, then get your ass down and camp for the tickets.

Re:Why is it illegal?

[asdf7890]

I fail to see anything illegal in what they're doing...

As I said above:

There system obtained access to resource (the tickets) under false pretences (pretending to be different individual people rather than one organisation). That, I believe, is fraud.

That is what is illegal by my understanding. If not actually illegal in their jurisdiction, it will definitely be a breach of the terms of service they have agreed to by signing up with the relevant people to buy the tickets in the first place - I wonder if they as a company would be OK with their customers blatantly ignoring any terms of service they dictate?

McDonalds and Burger King

They make their money by buying relatively abundant materials in bulk and selling smaller quantities, with a mark-up the customer is generally willing to pay for the convenience of not having to arrange and package the product itself themselves - even as someone who does not like McD and their ilk I see nothing wrong with this part of their business model. These people on the other hand are doing nothing except being mark-up adding middle-men who are making their profit out of nothing more than inconveniencing people by manipulating a finite (sometimes very limited) resource.

Re:Why is it illegal?

[BetterSense]

You mean "preventing others from even getting a chance to buy a ticket at deflated values".

If the connections are flooded with scalpers that only proves my point that there is a margin to me made between the price the ticket vendor is setting and what people are willing to pay for the tickets. There would be no such flood of scalpers if the tickets were not underpriced.

Re:Why is it illegal?

[Belial6]

If the gang showed up in line first, waited their turn, and then peacefully bought their tickets, and when they had them left without molesting any other customers, I don't see a problem with them.

Re:Why is it illegal?

[somersault]

And yet if people keep paying those inflated prices, it is entirely their own fault, and it shows that in fact the tickets are in fact worth more to people than they currently are paying. This kind of thing regulates itself. I find it pretty easy to say no when I know someone is charging over the odds for a luxury item.

Re:Why is it illegal?

[Belial6]

I have to agree. One can argue that price controls are a legitimate social need, but if we go there, then entertainment events are pretty far down the list of places to complain about that. Me I would start with Real Estate.

Re:Why is it illegal?

[Hatta]

I generally agree with you, but pricing tickets at market value does have its problems. If all tickets were priced at market value, that would price a lot of average people out of the market. The problem comes when you have a big name act who really wants average people to be able to attend their events.

Re:Why is it illegal?

[somersault]

I don't have an ideal as far as economics is concerned, I just wasn't aware that buying goods and selling them on at a higher price was illegal. If the government wants to make it illegal that's fine with me, but in this case I think the distribution system should be fixed rather than punishing those who took advantage of it. The sellers of the original tickets probably don't actually care what happens as long as they get rid of their tickets though. And as I keep fucking saying, if people didn't want to pay that much for the tickets, they wouldn't. It's as simple as that. The scalpers are never going to be able to sell tickets at a price higher than people are willing to pay.

Re:Why is it illegal?

[Enry]

If I win super bowl tickets, why should I be a scalper and go to jail for reselling them?

Because you don't understand economics? You're saying that a private individual selling tickets they legitimately acquired is the same as wholesale scooping of tickets (and price fixing) via fraud?

Re:Why is it illegal?

[Deus777]

I would expect some of the indictments are of the "you didn't follow the site terms of use" wire fraud variety, the main thing that jumped out at me from the article as illegal was this:

According to the indictment, Lowson and Kirsch interviewed former employees of online ticket vendors to determine what measures they took to thwart automated buying and also obtained source code, in some cases through hacking.

Emphasis mine. It would seem to me that acquiring copyrighted source code either via buying it illegitimately or taking a copy via hacking is something that most of us can agree is and should be illegal.

Re:Why is it illegal?

[JDmetro]

How about when I wanted to go to a concert in Edmonton and there were no tickets available first day they went on sale. They said it was sold out. Ticketmaster was giving the tickets to a subsidiary company to auction off at 10 times the face value. End result no one showed up for the concert because everyone thought it was sold out. Now the band won't play here anymore and although what Ticketmaster did was illegal the government said they have move important thing to do like give themselves 34% raises. Manitoba is the only province pretending to even do something about this.

Re:Why is it illegal?

[babblefrog]

And obviously, concert tickets are a natural resource :-)

Re:Why is it illegal?

[Anonymous Coward]

popular concerts can sell very quickly with normal demand without scalper hacking, pearl jam sold out in 15mins in 1994. and many others too. any popular concert's tickets will be gone very quickly even without scalpers.

Re:Why is it illegal?

[Belial6]

Sounds like they are using the same system as just about every other business out there.

Re:Why is it illegal?

[Belial6]

Either that, or the performers are playing too few shows.

Re:Why is it illegal?

[skiflyer]

A broker looking to make an arbitrage profit is not the antithesis of the free market. They've found a pricing discrepancy in the supply/demand chain, and it's so far out of whack that they can still profit without moving 100% of their goods. That is precisely the free market.

The only system being broken is the one where the venue sets a "fair price". That fair price is turning out to be much lower than the price the consumer is considering worthwhile. The venues are doing a terrible job pricing supply/demand for the more popular concerts. That's great for the consumer, so great that a marketplace has grown up around exploiting the arbitrage.

Re:Why is it illegal?

[amicusNYCL]

Feel free to read the indictment yourself, but they:

A) Bought tickets while they were not authorized to do so (automated bots are not authorized)

B) Hacked into vendor networks to steal source code and identify bot deterrence used by the websites

C) Committed wire fraud

In total, they have 43 counts of unauthorized access and wire fraud against them.

Re:Why is it illegal?

[Anonymous Coward]

What's that got to do with the legality? It pisses you off, so it's illegal? Shit, no wonder we have so many piss poor laws.

Seems to me the scalpers didn't do much anything different than Google and their first shareholders did during their "new way" of doing their IPO a number of years back. If you recall, Google cut out the Wall Street middleman and took the profits themselves, the same role the scalpers played in a typical IPO or what Google did when they cut the Wall Streeters out. I recall everyone seemed to be cheering Google then, I guess when it's your ticket on the line and you don't like the price, you go after the small guy, instead of ticketmaster and their ilk for the price fixing.

Re:Why is it illegal?

[amicusNYCL]

IANAL, but I think parent is right in saying that these guys have actually not done anything illegal

Did you even consider reading the indictment? It's linked to from TFA. Or are you just going to assume you know all the facts, and make your judgement? Maybe the government lawyers were just winging it when they wrote up a 43-count federal indictment, right? Here's a hint: one of the things they did was break into other people's networks to steal source code. Maybe that's not illegal in your world, but it is in the one where they got charged.

BTW, writing "IANAL" is not an excuse for ignorance. I've never studied law either, I just clicked on the indictment because I was wondering exactly what they did that was illegal.

Re:Why is it illegal?

[Anonymous Coward]

you're mixing your supply with your demand. Scalpers can only influence the supply curve. The demand is unchanged. Your belief that rate of ticket sales somehow changes the demand is lost on me. I imagine you are referring to the fact that the event will likely no longer sell out to 100% capacity. But capacity doesn't say anything about maximizing revenue. The free market economy you've modeled appears to have some non-revenue incentive for filling stadiums which you've not identified.

Re:Why is it illegal?

[amicusNYCL]

You missed the point. The scalper did you a service by even giving you the chance to see the concert. If there were no scalpers and every ticket sold was legit then there would be no tickets on ebay and your action of missing the ticket sale means you have zero options to attend.

You're assuming every event always sells out.

Explain this to me: these guys bought 883 of the 1000 available 2006 Rose Bowl tickets. How exactly is that doing anyone a service? People still have to buy the tickets, so why does it do people a service when they have to buy them second-hand for more money versus just buying them from the box office for face value?

Re:Why is it illegal?

[amicusNYCL]

If scalpers are able to sell the tickets at the increased price it means that demand exceeded the supply of tickets at the fixed price.

Not necessarily. It could also mean that the scalpers artificially reduced supply, which is exactly what they try to do. They might be sitting on 100 tickets, but the guy on the street only has 4 that he "really needs to sell fast". You think you're paying a premium for the last tickets, but the reality is that the stock levels are fine, and they sell all the tickets for that much.

Again, scalpers do no one a service except themselves.

Re:Why is it illegal?

[Hurricane78]

Wrong. (Commercial) resale is never illegal. It’s perhaps against the terms of the sale. But that can be disputed. In fact it was disputed, and shown in court no not be valid, multiple times.
What fraud? Who exactly got frauded? Nobody.
I did only read the summary, and it doesn’t look like they used bots.
And if I go to the supermarket, and buy all the bread with my own real money, it does not matter if it pissed off others who did fail to buy it before me.

Only impersonating *other* persons would be illegal. But “impersonating a person”? ...that term does not make any sense. You always are a person. A script between you and something else does not change it more, that the tool (e.g. wrench) between you and a machine. It’s just a tool.

And about impersonating a non-existing person... well, it’s not exactly proper, but it also doesn’t hurt anyone. So what?

Re:Why is it illegal?

[SparkleMotion88]

After all, they don't care if they sell ALL their tickets, just that they make a profit, so the more they buy, the higher they can set *their* per ticket price, and the fewer overall they'd have to sell.

So, how is that different from the way the concert producer sells tickets? The concert producer has exactly as much power to "artificially" influence the demand by selling fewer tickets (e.g. at a smaller venue), reducing the availability of the tickets (e.g. you have to stand in line for a day or win a contest with your local radio station) and altering the ticket price. So both the scalper and the producer are selling tickets, while doing what it takes to make a profit. The only major difference is the concert producer has enough money to buy favorable laws.

Re:Why is it illegal?

[shutdown -p now]

Simply put, socialist libertarians believe that all private property is an imaginary, artificial construct of a human society (much like many Slashdotters think of intellectual property). However, like capitalist libertarians, they believe that personal freedom is paramount, "your freedom stops where my nose begins" etc.

Re:Why is it illegal?

[shutdown -p now]

The "scalper" only makes money by selling a scarce item at what the market will bear.

The scalper makes money by making an item scarcer that it would have otherwise been, and then selling it for what the market will now bear.

Re:Why is it illegal?

[shutdown -p now]

What are you talking about? Their job is to sell stuff. If they can sell 100% of it, then they need 100% of it.

Quite often scalpers don't actually sell 100%, but they still try to get as close to that as possible, because this creates artificial scarcity driving the prices up.

Simply put, if you buy 100% of all tickets, you might only be able to sell half of them, but the price inflation caused by your local monopoly is such that your profit is far greater than the original ticket price for all those tickets.

Re:Why is it illegal?

[eth1]

Actually, strict enforcement is easy; it's allowing stuff like "I can't go, so I want to give my tickets to a friend" while disallowing scalping that's hard.

Strict enforcement would just require a name (or names) at the time of purchase (which get printed on the ticket), and not allowing those tickets in if one of the named people isn't present in the group, easily verified by a gov't issued photo ID.

Re:Why is it illegal?

[musicalmicah]

What if a condition of purchase is that the purchaser can't resell the tickets for a higher value?

Re:Why is it illegal?

[ResidntGeek]

Simple. They allowed people who can afford more to pay more for tickets, shutting out the people who were unwilling to pay the higher price. Those people willing to pay more would have otherwise been unable to demonstrate their higher commitment to seeing the game, and would have been shut out for arbitrary reasons instead.

Re:Why is it illegal?

[shutdown -p now]

A broker looking to make an arbitrage profit is not the antithesis of the free market. They've found a pricing discrepancy in the supply/demand chain, and it's so far out of whack that they can still profit without moving 100% of their goods. That is precisely the free market.

The only system being broken is the one where the venue sets a "fair price". That fair price is turning out to be much lower than the price the consumer is considering worthwhile. The venues are doing a terrible job pricing supply/demand for the more popular concerts. That's great for the consumer, so great that a marketplace has grown up around exploiting the arbitrage.

You know, I find it really sad that the term "fair price", as offered by the seller himself, is denigrated that way. Not just in your post, but in countless posts in this discussion.

Apparently not jacking up prices as high as you can - even if the markup is 500% and beyond - and screw everyone not able to afford it - is bad because it's a "market inefficiency". And scalpers are the good guys because they "fix" this "inefficiency", and as we all know, the only goal worth pursuing is an "efficient market" - it's a thing by itself, to be reached much like nirvana. If some people just want to be nice to other people - well, too bad, 'cause that's "inefficient".

Yet, when we look at this while taking the actual utility or harm done to the society, scalpers are clearly harmful. They don't produce any useful product. They don't offer any useful service (to remind, we're talking about the kind that buys 100% of tickets in the first few minutes after they go on sale, not low-scale resale). The only ultimate effect of adding a scalper to the picture is that customers end up paying more for exact same thing.

All in all, this story, and the comments to it, show a good example of why I consider unconstrained free market worship a form of sociopathy.

Re:Why is it illegal?

[twoallbeefpatties]

You really don't think these guys had 5,000 credit cards to buy 20,000 tickets at a time, do you?

Well, if they just fill out every "You're pre-approved!" request that comes in the mail...

Re:Why is it illegal?

[Anonymous Coward]

In India, airlines typically claim seats are sold out if you are travelling during the holidays. The tickets are not actually sold out, but simply retained by the airline. Then, as the holiday season approaches, the airlines release the tickets at ridiculously expensive prices. Why is this capitalism if done by the airline and scalping if done by a small guy who buys the tickets and sells it later at a similarly high price?

Re:Why is it illegal?

[amicusNYCL]

So you're saying that scalpers are good because they allow people with more money to see more events, and people with less money aren't able to see them. I guess it depends on your point of view whether or not you think they're doing you a service. If you're flush with cash and always wait until the last minute, then yeah, you might think scalpers are pretty great. If you make a normal amount of money and buy your tickets when they go on sell, I guess you're just out of luck. You should be making more money.

I'll just point out that scalpers don't allow anyone to get tickets. The people with more money could have gotten tickets on day 1 like anyone else, and paid the same price. They can "demonstrate their higher commitment to seeing the game" by purchasing the tickets when they go on sale, not by paying twice as much.

I could also point out that a person who doesn't make much money, but still wants to go to the event, probably has a higher commitment than the person who makes enough money to pay whatever the cost. The cost isn't going to affect the lifestyle of the more wealthy person, but the "regular" person may need to sacrifice in order to see it. That sounds like commitment to me, and those are the people who your scalpers "shut out".

Re:Why is it illegal?

[kramerd]

Assuming is the wrong word, you must have meant recognizing. You are recognizing that there are many things wrong with scalping

There are many things wrong with scalping, but the easiest one to note is that there is already a mechanism for purchasing tickets - and it comes without scalpers. We tend to call it "buying tickets at face value from the venue or predetermined representatives of the venue who charge a price set by the venue." This is a form of PRM (as opposed to DRM), or physical restrictions management. This PRM sets the price at which entrance may be gained to a venue for a specified time or event. Scalpers arbitrarily change that price. Meanwhile, scalpers don't even necessarily raise the price, because legitimate ticket holders (those who hold tickets with the intention of using them for access to the venue) can give away their tickets if they so choose (and scalpers must compete with free, face value, and other scalpers). The right of first sale does not apply here because your ticket allows you to rent a space for a specified time. It is not transferable (and the majority of tickets explicitly state that they are not transferable, hence the legal basis for why scalping is not legal).

The effect of scalpers and season ticket holders and such (regular ticket purchasers who do not necessarily intend to attend events to which they have purchased tickets) is that events sell out, so the venue is happy, but many seats remain empty. When I go to see Wynton Marsalis and the 8 rows ahead of me are empty but I had to pay a scalper 4x face value to get a seat, something is wrong here. Meanwhile, when I can get football seats for 20 below face and their are 3 people already in my seat and I have to get security to remove them 45 minutes before kickoff because I have a legitimate ticket and they have upper deck seats, there is a bigger problem. For popular events, you have to enter an online lottery to get tickets, and you have to try to buy the maximum allowed, and then you might, just might get to buy 1 seat (as you get a lottery chance for each seat you wish to purchase individually). The lottery exists explicitly because there are so many people trying to buy blocks of seats that there has to be a mechanism for people to randomly be allowed to purchase tickets.

The easiest way to stop scalping would be to require government id (like a driver's license #) in order to purchase a ticket. I know in my state, driver's licenses have a barcode, and that the majority of tickets to venues are scanned to prove that they are legitimate. The added cost would be..,a hell of a lot less than buying from a scalper, and quite frankly, negligible (I know I don't care about the difference between a $74 and a $76 ticket, instead of $400, cash only, hope its real from a scalper). Student tickets to many ncaa school events already work this way.

Scalping is illegal in many states, and furthermore, it is also wrong to scalp tickets. Unfortunately, as long as you are allowed to transfer a ticket by simply handing it to someone else, it will be impossible to stop scalpers. That doesn't make scalping right, or OK, or not wrong, or legal, or reasonable, or acceptable. It hurts the consumer, it hurts the venue, it hurts the performers, and often, when they buy more than they can sell, it hurts the scalpers too. No one wins when scalpers exist, except apparently this team of scalpers who made $25 M (and since they have been indicted, they might also lose).

Re:Why is it illegal?

[AmonTheMetalhead]

The gang in this analogy is virtual, it's an asset that one person controls and can deploy within microseconds, this is unfair competition to the honest customers.

If you were to make an analogy to the old ticket booth, this would be akin to a necromancer summoning an army of zombies & parking them in front of the ticket booth weeks before tickets go on sale, preventing any living human to be able to get to the booth before them (you need to eat, drink, sleep, piss, take a shit... zombies don't, well, except maybe eating the brains of living customers...), and not only that, he can also magically transport his army of zombies to and from many locations within seconds

Re:Why is it illegal?

[AmonTheMetalhead]

One scalper with thousand connections vs one customer with one connection, you do the math.

The problem isn't John Doe buying his two tickets to sell on eBay (although i do hate guys like that), it's John Does who has a botnet at his disposal.

Re:Why is it illegal?

[Cytotoxic]

Scalpers create the scarcity.

Venues compete on price, location and other stuff. This brings prices down. When scalpers step in, the venue has already been locked in. There is no more competition.

Not really. If the venue offers 25k seats for a concert, there are still 25k seats available if the scalpers buy every single one of them. If the venue really wanted to discourage scalpers, they'd say "wow, we just sold out our concert. Let's add another show!". Rinse, repeat until the scalpers quit buying tickets. Now the band got paid, and the audience can still buy seats at the cheap price. Maybe even below retail if the scalpers misjudged demand.

As for why it shouldn't be illegal to charge less? it's a fictional problem. You don't have people bidding down the prices of tickets before an event.

I hate to disagree, but I have personally done this many times. I sat at half court, 5th row for the ACC tournament final one year and paid half of face value. This in a year when upper deck seats were going for $500 and up. How did I do it? Brinkmanship. As tip-off approached, I talked with a few of the bigger scalpers and offered them $20 bucks for a pair of seats. They all laughed at me. After the crowd disappeared and they realized they had no more customers, they cut a deal. Better to get a couple of bucks for beer money than take the tickets home. Tickets are the ultimate in perishable goods. They are worth precisely $0.00 after the concert.

Re:Why is it illegal?

[tompaulco]

The analogy is more like Burger King is willing to sell you a meal for $5. However, every morning, a couple of guys come in and buy all the meals, then hang around on Burger King's property offering to sell the meals for $15.

Re:Why is it illegal?

[AmonTheMetalhead]

Read the indictment, the charges were conspiracy, fraud & illegal access to computer systems.

The were impersonating as other people to be able to purchase more then the set maximum tickets per buyer, they used automated software on whole networks to do so.

Re:Why is it illegal?

[HungryHobo]

yes.
yes they do.
And there's nothing wrong with that.

It implies either/both
1: supply is too low: there's room in the market for more performances/more games/larger venues.
2: initial prices are too low.

 

Re:Why is it illegal?

[HungryHobo]

I can imagine in the near future the possibility of electronic tickets being issued.
With some solid crypto you could then ensure both legitimacy and identity of the seller.

Re:Why is it illegal?

[AmonTheMetalhead]

A little extra? You are clearly not someone who goes to concerts.

Besides, the scalpers in this case used illegal means to obtain their goal, this isn't John Doe selling his two tickets on eBay, this is organized crime.

Re:Why is it illegal?

[Cytotoxic]

Simply put, socialist libertarians believe that all private property is an imaginary, artificial construct of a human society.

I find that people who believe that personal property is an imaginary construct feel quite differently when you try to drive off in their car.

Re:Why is it illegal?

[Anonymous Coward]

Except you can't start that company. There's a monopoly on producing tires.

Re:Why is it illegal?

[AmonTheMetalhead]

Technology allows large scale scalpers to gain access to tickets they otherwise would not have access too, they overload the sales systems, they manipulate the availability & value of the tickets and generally piss off everyone (except a large portion of slashdot, oddly enough).

Ticket sales are usually limited to 2 or 4 per person, if an organization has access to multiple accounts on multiple names and a large enough number of computers & working bots, they can buy a lot more tickets within seconds then you or i ever will be able too, hell, the use of a large botnet might even mean you can't even access the ticket sale system

Re:Why is it illegal?

[Cytotoxic]

- before scalpers got in and scooped up massive numbers of tickets and artificially inflated the price, regular fans were able to get tickets from the box office at a reasonable price for a longer period of time.

I don't know how old you are to define "before", but back in '81 Springsteen sold out 3 shows in 15 minutes. This is at the box office. We went down there and arrived shortly after the box office opened to find everyone leaving. Oops. I was laughing at the idiots who camped out for three days on the way to the Colosseum, but not so much on the way home. I think maybe the "I could get tickets easy" view might have as much to do with the demand for the act as anything else.

Re:Why is it illegal?

[AmonTheMetalhead]

It's not just the venue who set that price, but the acts themselves as well, a lot of artists want the prices to be accessible to many people (their fans), not the rich bastards who don't care what they pay.

Also, by using botnets, they prevent access to the sales system by other customers thus forcing that person to use their services or stay home.

Re:Why is it illegal?

[Cytotoxic]

The only ultimate effect of adding a scalper to the picture is that customers end up paying more for exact same thing.

Well, that and the fact that you can buy great seats at any time to any event. Good luck getting front row, center court to the NBA finals at the box office.

Re:Why is it illegal?

[AmonTheMetalhead]

Did you ever consider the possibility that artists might have a say in the price? (Hint, they do)
Did you ever consider that using botnets to flood the ticket sales system prevents honest customers to get their ticket fairly?

Re:Why is it illegal?

[AmonTheMetalhead]

What. The. Fuck?!

Unwilling to pay the higher price? How about being unable to afford the higher price?
And what's so fair about the scalpers? The queue system is pretty fair, first come, first served, of course, throw a botnet onto that queue and you skew the system terribly, but for individuals it's pretty much fair & unbiased.

Re:Why is it illegal?

[Enry]

I'm not the one defining 'Before'. Go ask MrKaos.

That being said, how long do you think tickets would last if scalpers were in on it? 10 minutes? 5?

Re:Why is it illegal?

[shutdown -p now]

Well, that and the fact that you can buy great seats at any time to any event. Good luck getting front row, center court to the NBA finals at the box office.

Do you think that it just might have something to do with the fact that scalpers rush to buy out those tickets ASAP, using schemes such as one described in TFA?

Re:Why is it illegal?

[shutdown -p now]

It depends. Most true socialists and anarchists I've known are, in fact, people with little to lose.

It should also be noted that, in a hypothetical anarcho-socialist society, driving around in "someone's" car (quoted because the concept would be alien to such a society) would be perfectly fine, but only so long as everyone can be reasonably expected to take care of the said car - drive it carefully, maintain it, etc. One could argue that, as this is not the case in present-day society, and it's built around the concept of property ownership, even an anarcho-socialist living in it will have to protect his property from appropriation by others as a matter of survival.

Re:Why is it illegal?

[Cytotoxic]

This is exactly voting with your dollars. Plenty of people are willing to pay more than face value for a ticket, so there are scalpers. Simple. Same reason there are drug dealers and prostitutes - because there are people voting with their dollars to have them. At the same time, there are no "get a kick in the balls for $1000" emporiums, because there is no demand for this service at this price. And please, nobody post a link proving me wrong on that one.

Re:Why is it illegal?

[EastCoastSurfer]

If all tickets were priced at market value, that would price a lot of average people out of the market. The problem comes when you have a big name act who really wants average people to be able to attend their events.

Then how do you plan on distributing a limited number of tickets? Right now I'm put out of your market because I don't have the time to click refresh over and over and over on ticket release day. It has nothing to do with letting the average person attend an event. The event will be priced at whatever the sponsor feels they can sell all the tickets for.

Re:Why is it illegal?

[EastCoastSurfer]

I'm confused why you keep saying 'artificial' demand. If a scalper sells every ticket he has, the demand was real. The demand hasn't changed at all, if anything it has gone down while the prices have gone up until they meet (the classic price/supply/demand curve). You could argue that scalpers effect supply, but even that's spurious because they want to sell all their tickets too. I don't see scalpers buying and burning a bunch of tickets to drive up prices of the tickets they have left.

And the argument that you're cutting out people who can't afford to attend is bogus. What about the people that can't stand in line for days or who miss the lottery or clicking and buying? Maybe the government should force an artist to play as many events as possible in a given city until everyone who wants to attend has been able to attend.

Re:Why is it illegal?

[EastCoastSurfer]

How have the scalpers skewed the price? They are NOT creating demand. The demand is already there. They are not creating ticket scarcity (the size of the venue causes that) because they certainly want to sell all of their tickets.

At worst the scalpers are removing someone else's chance to win the click lottery and buy the tickets on the cheap. At best they are providing options for people who lose the click lottery to still see the event.

And any event that isn't sold out or takes awhile to sell out will not have a huge markup for the scalper because the obvious demand isn't there to drive it. If the demand isn't there then the final buyer can often get the tickets for LESS than face value because any tickets left in the scalpers hand equals lost money.

Re:Why is it illegal?

[EastCoastSurfer]

The artifical scarcity produced by the scalpers who make it harder for people to find the tickets is important.

Do you think scalpers are buying and burning tickets to provide scarcity? The scarcity is caused by the size of the venue. It's real scarcity and there are only so many seats to go around. So what's the best way to distribute tickets? The click lottery or through a market mechanism? Right now we have both since people can win the click lottery, or if they don't they can buy tickets at true market value.

Re:Why is it illegal?

[EastCoastSurfer]

You're again ignoring the point - before scalpers got in and scooped up massive numbers of tickets and artificially inflated the price, regular fans were able to get tickets from the box office at a reasonable price for a longer period of time. Since scalpers were able to get large numbers of tickets, the pool of tickets has decreased, thus raising the price.

I've been going to events since way before the internet. Scalpers have always been around.

No one has 'artificially inflated' the price. The price has simply risen to meet demand. What's happened is that demand in general has risen. There are many more people who want to attend most every event than there is space at the venue.

The pool of tickets has not decreased, it's the same as it every was - the size of the venue. The problem is that as demand has risen, venues haven't gotten much bigger (for various reasons).

So you end up with 2 problems. Either you lock people out of attending because the lose the click lottery or you lock people out because they can't afford the ticket. If you want everyone who wants to attend be able to attend the only solutions is to add more shows.

Look at something like the shows in LV. Very few scalped tickets for those because the casinos did 2 things. They raised prices to the meet the true level of demand and then added shows.

Regardless, you can't blame the scarcity of the ticket (venue size) or the price (demand) on the scalpers. They are simply acting as the market clearing mechanism.

Re:Why is it illegal?

[skiflyer]

All in all, this story, and the comments to it, show a good example of why I consider unconstrained free market worship a form of sociopathy.

I don't necessarily disagree with you. But what's the alternative in this case? A tax on each ticket sold which is then used to fund a regulatory body that enforces a no scalping law? Or do you just want good old human nature to change?

My post was simply pointing out that the parent poster misunderstands the free market, not that the free market is something to worship.

Re:Why is it illegal?

[EastCoastSurfer]

So you think a scalper is simply going to swallow the loss on a 100 tickets? A scalper who does that won't be in business very long.

I've only paid more than face value for a ticket once (got to see Michael Jordan in the playoffs!) and every other time I've attended an event that I had to buy tickets on the street I paid far less than face value. You just have to remember that once the event kicks off those tickets quickly go to zero value.

Re:Why is it illegal?

[skiflyer]

Then they need a system which is not open to the free market. At this point in time these kinds of tickets are, and quiet simply they're SOL if they're going to stay in that realm.

Switch to non-transferable tickets that require ID to purchase (think air travel) or maybe day of purchase only (then you'll only get the die hard fans who think it's worth the gamble to go to the venue).

I don't like what the scalpers are doing any more than most people here, I'm just saying it shouldn't be a surprise and it's completely within the very common understanding of a free market system.

Re:Why is it illegal?

[shutdown -p now]

I don't have any legal solution to this problem, nor do I see any reasonable one. I was commenting on the moral aspect of this, not legal one - we'll always have things that are just not nice to do, even if you are allowed to do them. Those kinds of things should earn one shunning in his society, at least.

The reason why I even bothered to post was that many posters in other threads seem to be justifying those actions as moral (and even proper/desired), rather than merely legal.

Re:Why is it illegal?

[skiflyer]

Well then we're in violent agreement!

Re:Why is it illegal?

[Cytotoxic]

Do you think that it just might have something to do with the fact that scalpers rush to buy out those tickets ASAP, using schemes such as one described in TFA?

In a word, no. There do exist high demand events that will always sell out immediately (such as the NBA Finals, Super Bowl, World Cup Finals, etc.). These events have no need, nor any real opportunity, for squatting by scalpers in order to drive up demand. Demand for good seats at these events is essentially unlimited (in numbers). Let's say there are 10,000 premium seats available for the World Cup finals. There are over a billion people watching the event. If even 10% would like to attend in person, that's an over-demand situation in the extreme. So no, the difficulty in any one individual purchasing a ticket to a super-high demand event does not have something to do with scalpers rushing out to buy those tickets ASAP. In fact, every person who manages to obtain a ticket to the Super Bowl has to at least entertain the notion of selling the tickets and pocketing the cash. Such is the law of supply and demand.

Re:Why is it illegal?

[Enry]

The scalpers are indeed causing a scarcity, since at the time they're in play, they're the only ones with tickets to sell. Had they not been in place, the tickets may still be available at list price.

Re:Why is it illegal?

[Enry]

I can indeed blame the scalpers for increasing the price. They're the ones setting the price by limiting supply.

Re:Why is it illegal?

[Cytotoxic]

It depends. Most true socialists and anarchists I've known are, in fact, people with little to lose.

Too true. Perhaps I should replace "car" with "favorite Tommy Chong original, hand-blown, glass bong".

Re:Why is it illegal?

[EastCoastSurfer]

They are not causing any ticket scarcity unless they are destroying tickets. The venue determines the supply (plus public demand) and thus ticket scarcity.

Any events that are worth the scalpers time are events that are selling out in minutes. If an event is sitting with 1/2 it's tickets unsold until the day of, scalpers will not bother. There isn't enough demand to drive their profit. The only way a scalper makes money is when demand outstrips supply and drives up prices. So to say if there were no scalpers there might still be tickets just isn't true. I've been to many events pre-internet time and many sold out as fast as it was possible to sell tickets at a box office (and many I couldn't go to because they sold out).

The scalper could buy all of those 1/2 of the tickets left, but if the demand was that low with the old price how much demand is there going to be with the scalper trying to make some profit...hint - even less.

The only way to get rid of scalpers would be to raise tickets prices (which will lower demand) or add shows (which will raise supply). Outlawing scalping doesn't do anything except make winning the click lottery all the more important and giving people who lose that lottery no other option to see the show.

Re:Why is it illegal?

[shutdown -p now]

Demand for good seats at these events is essentially unlimited (in numbers).

It's a good point, but do you think that it may be precisely what makes it a unique case worthy of special consideration?

Such is the law of supply and demand.

The law of supply and demand isn't absolute. We (as a society) can let it work freely if we believe it is ultimately beneficial for everyone, but this is not always so.

Re:Why is it illegal?

[shutdown -p now]

That would be an even worse example, as sharing the bong is kinda traditional in those circles.

Re:Why is it illegal?

[amicusNYCL]

So you think a scalper is simply going to swallow the loss on a 100 tickets? A scalper who does that won't be in business very long.

If they received a significant premium on the tickets they did sell, then yes they can afford some unsold stock.

You just have to remember that once the event kicks off those tickets quickly go to zero value.

Right, they sell off excess stock for low prices, because $1 is better than nothing. Still, they can afford to sit on stock as long as they've made ridiculous profit on what they've already sold.

When a scalper is buying up groups of hundreds or thousands of tickets (which is what they did in this case) and selling them for twice as much, they can afford to only sell half. If they sell 3/4, and end up with 1/4 unsold, they've made a lot of profit. They bought almost 2000 tickets for the 2007 Yankees playoffs, so imagine how many of those went unsold. Probably not very many.

Re:Why is it illegal?

[EastCoastSurfer]

This is econ 101 stuff. A scalper can only get those high prices if the demand is there. You have a great example of the Yankees tickets. Obviously the demand was there and the supply was constrained by the number of seats. The scalper made the market and met the demand. What do you suggest should have happened? Should the box office continued selling $5 tickets until game time? That's IMPOSSIBLE because all those tickets would have sold out in minutes. The other solution would be to auction the tickets, but then you're paying as much as you would pay a scalper.

You act like a scalper can buy the tickets and just double the price and people will buy. That's not how it works. An event is optional for people to do. If the scalper isn't selling any tickets the price will come down. This is how I continually get tickets to weekday basketball games at below face value. If the event is sold out and demand is high (Yankee playoff game) the price will skyrocket. The scalper doesn't 'set' this price, the market does.

If the scalper can buy the tickets and sell them all at much higher prices then the event was under priced to begin with.

Re:Why is it illegal?

[EastCoastSurfer]

How are the limiting supply? Find me a story where the scalpers were buying and destroying tickets because that is the ONLY way they can limit the supply.

You can blame the market for increasing the price. The supply of tickets is constrained by the venue (and number of shows). As demand goes up the supply doesn't move so prices increases (we're talking basic econ 101 stuff now). It works in the opposite also, as I have taken advantage of many times.

Do you really think an event with any popularity (the only time scalpers can really sell tickets at higher prices) is going to still have tickets available at the box office the day of the show? Yeah, lets just head up to the box office the day of the Rolling Stones concert and buy some tickets. They won't be sold out and if they are it's because of those scalpers! ROFL.

Like I said before, the only way to get rid of scalpers is to raise ticket prices (either just raise then or do some auction) or raise supply by doing more shows.

Re:Why is it illegal?

[EastCoastSurfer]

We tend to call it "buying tickets at face value from the venue or predetermined representatives of the venue who charge a price set by the venue."

The only thing recognized by scalping is that many even tickets are simply under priced to begin with. Would it make you feel better if the ticket prices were increased or if some sort of auction was used? That would finally match the ticket price with actual demand and put the scalpers out of business.

Otherwise, the artificially low prices mean that in order to see a high demand show you have to get lucky and win the click lottery. Right now we have both, win the click lottery and pay the artificially low price or if you lose you can pay market rates.

When I go to see Wynton Marsalis and the 8 rows ahead of me are empty but I had to pay a scalper 4x face value to get a seat

You didn't have to pay him anything. Obviously demand was high if he got you to pay 4x face value. Would you have rather not had that option at all because you lost the click lottery when tickets became available? Or maybe you just want to government to force the entertainer to do addition showings until everyone who wants to go gets to go at that great low price?

Re:Why is it illegal?

[TheSync]

The reason that scalping is illegal is NOT because the act of selling tickets at the highest possible price is illegal. It's because its very hard for the purchaser to know whether the ticket is legitimate or not.

TicketsNow can re-issue valid barcodes for Ticketmaster tickets, thus this problem has been eradicated...

Scalping actually became illegal because of the perceived problems of people standing around a venue offering speculatively purchased tickets (sometimes below face price!) The "stand outside the venue" kind of scalping is still illegal in many cities.

Because of the history of these laws, legit resellers like StubHub and TicketsNow must maintain huge databases of local laws and ensure they are doing legal reselling. For example, in Ontario and Arkansas you can't resell a ticket for more than face value. New Jersey has a 20% mark-up limit. Many cities also have their own rules.

Re:Why is it illegal?

[TheSync]

I talked with a few of the bigger scalpers and offered them $20 bucks for a pair of seats.

Indeed, often scalpers take a bath. For example, you can go on TicketsNow right now and get nosebleed seats for St. Louis Blues at Phoenix Coyotes for $7, which is $3.75 cheaper than the cheapest primary market ticket for that game.

Re:Why is it illegal?

[TheSync]

The scalper makes money by making an item scarcer that it would have otherwise been, and then selling it for what the market will now bear.

How about the scalper makes money by taking on the risk that he/she may/may not be able to resell tickets for above face value. In doing so, they remove some of the risk to their suppliers (the artist, the promoter, the venue, and the ticketing company).

Risk is generally correlated with potential reward in investments.

Thus a scalper also makes tickets less scarce by reducing the risk to the suppliers and thus encouraging a concert to happen that would not otherwise occur.

Re:Why is it illegal?

[Bobb Sledd]

But they do offer a service: If everyone can afford the ticket, and there is only a limited supply of tickets, then there is a high probability that I may not get a ticket (because the line is too long, or the web site goes down.)

Now, if I am willing to pay more for a ticket than everyone else, just to even get one, then what the scalpers have done is made it at least possible for me to get a ticket by creating the scarcity; making the line shorter for me.

I love to play Devil's Advocate, but there is one thing I cannot quite rectify: If the goal of the show is to promote an event, and not necessarily to generate cash, then the scalpers are doing a disservice to the show hosts. If $rockstar wants to sell his tickets for $5 (that normally would sell for $75), just to encourage people to actually show up, and the scalper buys all the tickets and only sells a few for very high profit, then $rockstar is actually damaged and scalper still made money.

Re:Why is it illegal?

[DrCode]

Well... should it be illegal to sell a penny for $100? How about a 10-cent stamp for several thousand? Should there be a law banning the selling of these for more than 150% of face value?
I'm more upset at the ridiculous fees that Ticketmaster charges, but I guess that's also a case of 'what the market will bear'.

Re:Why is it illegal?

[shutdown -p now]

How about the scalper makes money by taking on the risk that he/she may/may not be able to resell tickets for above face value.

Oh, c'mon. What risk is there in practice, and not in theoretical conjectures? Scalpers always go for events which are practically guaranteed to be in demand so high that all tickets would go under normal prices. The chance of them not selling the tickets at least at the same price they've bought it is about as high as having a meteor strike their head office...

Re:Why is it illegal?

[shutdown -p now]

But they do offer a service: If everyone can afford the ticket, and there is only a limited supply of tickets, then there is a high probability that I may not get a ticket (because the line is too long, or the web site goes down.)

Now, if I am willing to pay more for a ticket than everyone else, just to even get one, then what the scalpers have done is made it at least possible for me to get a ticket by creating the scarcity; making the line shorter for me.

True, but that means that they serve as a force that widens the income gap - making things less affordable to the "plebes" than they otherwise would have been - which has an overall negative effect on the society as a whole.

I love to play Devil's Advocate, but there is one thing I cannot quite rectify: If the goal of the show is to promote an event, and not necessarily to generate cash, then the scalpers are doing a disservice to the show hosts. If $rockstar wants to sell his tickets for $5 (that normally would sell for $75), just to encourage people to actually show up, and the scalper buys all the tickets and only sells a few for very high profit, then $rockstar is actually damaged and scalper still made money.

It's a good point. This has been sorta countered by "your faulty business model is not our concern", which makes perfect sense from a position of no altruism whatsoever, and pure self-interest; but I am not willing to accept the latter as a desireable societal norm.

Re:Why is it illegal?

[Hatta]

The Grateful Dead had a good way of doing it. Mail order, with a lottery. One entry per household.

Re:Why is it illegal?

[amicusNYCL]

Should the box office continued selling $5 tickets until game time?

Yankee Stadium doesn't exactly have $5 seats but, yeah, surprise surprise, I think they should continue selling tickets at face value until the tickets are sold out (or the event ends). Weird idea, I know.

That's IMPOSSIBLE because all those tickets would have sold out in minutes.

So what? Why is that a problem?

If the scalper can buy the tickets and sell them all at much higher prices then the event was under priced to begin with.

Yeah, maybe so, but I'm not arguing about what the proper price is for any given event. I'm arguing against one entity buying up all of the supplies of a finite resource, then doling them out for a higher price. That's simply not fair. When corporations do that it's called price fixing. What do you think Apple would do if one group bought 90% of the iPads on launch day, then turned around and started selling each one for twice as much on ebay?

Is it legal? I don't know, I'm not a lawyer. Is it ethical? Some may argue so. Is it an asshole move? Yeah, it's an asshole move, and it would be pretty difficult for you to argue that they are providing a service by allowing everyone with disposable income to purchase an iPad to the exclusion of everyone else.

Re:Why is it illegal?

[Enry]

Right. You obviously have no clue how economics works, so I'm not going to waste my time anymore trying to explain it to you. Go waste your money buying tickets from scalpers, I don't really care.

Re:Why is it illegal?

[TheSync]

Oh, c'mon. What risk is there in practice, and not in theoretical conjectures?

I can tell you that right now there are plenty of NHL games on TicketsNow that are reselling below the lowest face value of a ticket in the arena (like $7 for Phoenix vs. St. Louis).

Resellers may try to go for events that are sell-outs, but it doesn't always work that way. For example, last year Green Day did not sell out the New Orleans Arena, and neither did Coldplay nor Creed. Many tickets were probably left in the hands of resellers.

If reselling were risk-free, why would venues push the risk onto ticketing companies (through fixed exclusive "lock-in" payments) and resellers? Venues can't afford the risk because they tend to have fixed regular commercial mortgage and labor costs.

Re:Why is it illegal?

[kramerd]

I absolutely would prefer that performers and those who own venues and work to get performers to perform raise prices to counter demand (just in case you can't read, which based on your response, you cannot; yes, I would like to see higher prices), and I would vastly prefer to pay more for tickets where people actually go, rather than scalpers holding out and not selling tickets, thus prohibiting me from going to the box office and buying the better seats. The lottery method in and of itself does not remove scalpers, it just cuts down on the number of them and makes the tickets even more expensive.

My biggest issue is that performers see that they sold out a concert but no one showed up, they are much, much less likely to return. Smaller cities get big names because people care about the arts in those cities, and they come out in droves. They also tend not to have scalpers.

On the other hand, I brought up nothing to encourage the concept of govenment intervention, in fact I directly stated that such intervention has failed. Venue intervention makes sense. In fact, the solution I proposed (sell tickets to people and require ID) and that others have improved upon in this forum (print the purchaser's name on the ticket and require ID) involve no government intervention whatsoever.

Next time, try to post without making absurd false accusations about my train of thought.

Re:Why is it illegal?

[shutdown -p now]

I can tell you that right now there are plenty of NHL games on TicketsNow that are reselling below the lowest face value of a ticket in the arena (like $7 for Phoenix vs. St. Louis).

I never said there are no such venues. But those tickets you quote as being resold below the original price - do they come from mass-scale scalpers, or from individuals who, for one reason or another, decided to get rid of one (or a few) tickets that they own? Scale and intent matters here...

Re:Why is it illegal?

[Anonymous Coward]

Then, I'd dare say, you're misunderstanding the facts.

When a market if being described as "inefficient" what is meant is that there is still space for one or more actors to participate in it without violating the basic assumptions of classical economics (self-interest, rationality, marginal utility and so on). There is no express or implied judgment on the morality of the market.

When "some people want to be nice to other people", creating as you suggest an "inefficiency" in the market, the problem is not with the "niceness" of the people: it's with the opportunity presented to those who want to act "not nice". IF the market was efficient, THEN there would be no incentive for the "not nice" actors to enter the market and the problem would not occur in the first place. So, although ideally you would want to create optimally fair and efficient markets (that is, markets in which there is no incentive for any actor in disrupting the fairness), in reality that's not easy to do. In other words, most real world markets will tend toward the point of "maximum efficiency" rather than the point of "maximum fairness", despite the fact that the economic actors are not in any way "sociopaths".

So what you should ask is this: what is the benefit for certain markets in operating in an inefficient way? For instance, let's say you're a producer, you put on a show and want to sell your tickets. Some "angel investor" comes and pays face value for all your tickets on the first minute of the sale ... Is there a better scenario for you? All your utility right there, no risk, no delay, no further marketing or operating expenses, just profit! True, this might be an indication that you might have gotten even more money if you had priced your tickets higher (and if you could tolerate the increased risk implicit in the higher price), but once you decide on the price of your tickets then the best outcome for you is to sell them all in as short a period of time as possible! And THAT'S why an inefficient market might benefit you as a producer of the traded good: it minimizes your risk, allowing you to lock your profit as early as possible (so that, for instance, you have capital to start producing your next show earlier!)

So, from the point of view of the market, the "angel investor" (which, of course, fulfills a very similar role in the previous story than scalpers in real life) adds something of very real value: *liquidity*! You might have heard that the current "recession" started when markets almost "froze", i.e., when they almost lost all of their liquidity. The remedy of the government was to pump money into the markets, i.e., guarantee their liquidity, so that they could continue operating (distributing goods and services to the population at large). Yup, that's how important liquidity is to the proper working of a market!

Therefore, the scalpers are actually *clearly beneficial* to the markets in which they participate: they provide money so that producers can recoup their investment faster at a lowered risk (and therefore, lowered cost), which ultimately translates into more profit for the producers and more shows for the audience! True, they increase the prices, but not beyond what the audience is willing to pay (by definition, or the scalpers would go out of business). In a way, that's exactly what banks do: provide liquidity to the markets, assume part of the risk in exchange for part of the profit.

And, for sure, that's *exactly* what TicketMaster does!!! So ScalperMast ... err, TicketMaster complaining about scalpers using technology to take advantage of market conditions is like the proverbial story involving a pot and a kettle (and actually a good reason for you to consider constrained, non-free, monopolistic markets, like the one TicketMaster creates and maintains, a form of sociopathy!)

Re:Why is it illegal?

[Stray7Xi]

The problem with (digital) scalping is that the organized scalper will swamp the servers with thousands of connections at once, thus preventing many honest customers from getting a ticket or even to be able to connect to the servers.

Arbitrage will crop up anytime there's a significant difference between the seller's offered price and the price the buyer is willing to pay (for anything scarce). Had the price been close to the market value, the scalpers would be unable to sell marked up tickets.

Re:Why is it illegal?

[ResidntGeek]

It's not really a point of view thing. This is how capitalism works. The price rises to the point where demand and supply are equal. That's how scarce goods are distributed. Want more scarce goods? Get more money. You can argue all you want about whether or not it should work that way, but history seems to say it works and the alternatives don't.

Re:Why is it illegal?

[ResidntGeek]

Life isn't fair. In life, the people with more money get more of the things they want - that way, the people with the goods maximize their profit, and consumers work hard to get more money, and therefore contribute more to the world. That's much better than the "fairness" bullshit we feed the kids to keep the stupid ones behind.

Re:Why is it illegal?

[Stray7Xi]

Apparently not jacking up prices as high as you can - even if the markup is 500% and beyond - and screw everyone not able to afford it - is bad because it's a "market inefficiency".

Yes market inefficiencies are bad. While the demand may go up with lower prices it doesn't raise the supply. Seats at a venue are limited. The ideal price is one where it sells out exactly, so everyone that wants a ticket at that price can get a ticket. If you lower the price, consumers scramble for tickets that just don't exist. Well intentioned scalpers provide a service. They guarantee you can get a ticket (if you're desperate enough.) But initially the "scalpers" are few and the potential buyers are many. The "scalped" efficient price far exceeds the market efficient price. After all they have to price for the majority of customers with a pittance of tickets.

The problem is speculators move in, creating artificial demand, which raises prices further. The solution is raise supply (not easy, larger venues change the experience) or lower the demand (raise prices)

Re:Why is it illegal?

[EastCoastSurfer]

Why lock the ticket to a person? You're basically putting DRM on a ticket. And show ID to buy a ticket, that's absurd.

I'll just go with that you agree that some dutch auction style selling of the tickets is the way to go. Obviously we'll get the people crying who can't afford whatever the bid price ends up being, but it will substantially cut down on the scalping.

BTW, I lived in a small town for a very long time I've never seen this sold out show where no one showed up. A link to an article that talks about how 20%-30%+ seats were empty at some show because scalpers refused (ROFL) to sell the tickets would be a big help.

Re:Why is it illegal?

[EastCoastSurfer]

Please explain economics to me then. I have bought nearly all my tickets from scalpers at less than face value so I don't think I'm wasting money.

I'll lay out the premise so you can easily understand:

There are a fixed number of tickets (supply is inelastic thus a vertical supply curve)
[See here and here]
Demand is how many tickets will sell at a given price (demand is elastic and will change with price)

Most high demand concerts that I've seen price their tickets in such a way that there are not enough to satisfy demand at that price even if every ticket was purchased by a person going to the show. So that means at face value of the ticket demand will not be satisfied and equilibrium will not be reached. Pretty basic economics (think what happens in rent control).

To totally clear ticket demand there should be no face value and tickets should be sold using some sort of dutch auction. The scalpers are crudely filling this gap in demand at a certain price and supply by raising the price.

Dumping the scalpers will not change supply one bit (it won't suddenly add seats to the event). High demand events will still end up without enough tickets because of the artificially low prices. The difference is that if you miss the click lottery you will have no other option to find a ticket. They will be sold out.

What I think we'll eventually see is all tickets will be sold auction style. When the organizers see scalpers making this much money on under priced tickets they will want in on it. When that happens I'm sure the same people will cry about tickets costing too much but then they won't have the scalper boogeyman to blame.

Re:Why is it illegal?

[EastCoastSurfer]

The Yankees do sell tickets until they are sold out. Even without scalpers they would be sold out in minutes.

So what? Why is that a problem?

It's a problem if I wanted to attend. And since I'm willing to pay more than the next guy why shouldn't I be allowed to buy a ticket from whomever?

Yeah, maybe so, but I'm not arguing about what the proper price is for any given event. I'm arguing against one entity buying up all of the supplies of a finite resource, then doling them out for a higher price. That's simply not fair.

Well you can't talk about scalpers, tickets, etc... without talking about price. If they are selling tickets at what the market will handle I don't see what the problem is. Their goal is obviously to sell the tickets, so they will price them accordingly. And what do you consider fair? Is it fair that the jobless guy who can camp out for weeks gets a ticket and I don't because I'm working?

When corporations do that it's called price fixing. What do you think Apple would do if one group bought 90% of the iPads on launch day, then turned around and started selling each one for twice as much on ebay?

Price fixing generally requires cornering the entire market. Find me a scalper who is buying 20k-30k seats at venues and fixing the price. They aren't. Scalpers are simply selling tickets at market value. And the Apple thing is funny. They are already priced in a way that excludes anyone without disposable income. If one group wanted to take the risk that Apple underpriced demand, I would tell them to have it and good luck. My guess is that most people would simply wait for Apple to get more stock and buy them direct and that mythical group would end up a lot of iPads.

The only real fix is to move all tickets sales to a dutch auction style. This will fairly price tickets according to demand but will also eliminate those without much money. I see the venues moving towards this because news like the original article shows they are leaving a lot of money on the table and severely underestimating demand.

Re:Why is it illegal?

[toddestan]

How are the limiting supply? Find me a story where the scalpers were buying and destroying tickets because that is the ONLY way they can limit the supply.

It can and does happen if the optimum price point is not when the venue is full. Say you have 1,000 seats, and you could fill it at $50 a seat, or you could sell 600 seats at $200 each. If a scalper effectively controls the supply because they have 90% of the tickets, they can pick the latter thus effectively reducing the size of the venue.

Re:Why is it illegal?

[toddestan]

A broker looking to make an arbitrage profit is not the antithesis of the free market. They've found a pricing discrepancy in the supply/demand chain, and it's so far out of whack that they can still profit without moving 100% of their goods. That is precisely the free market.

Well, the problem is that you can't have a free market. A free market requires that there are no barrier to entry for suppliers. However, a supplier can't set up shop and start creating tickets to the show. Only the venue can do that, and they have a complete monopoly.

The only system being broken is the one where the venue sets a "fair price". That fair price is turning out to be much lower than the price the consumer is considering worthwhile. The venues are doing a terrible job pricing supply/demand for the more popular concerts. That's great for the consumer, so great that a marketplace has grown up around exploiting the arbitrage.

The venue is only doing a terrible job of abusing their monopoly position to the fullest. They could limit supply, practice price discrimination, product bundling, exclusive dealing, and other practices that people generally look down upon. However, for the most part they seem to be as fair as possible despite their monopoly position. Only to have the scalpers come in act an abusive manner in their place.

Re:Why is it illegal?

[BillX]

No disagreement that the practice is rotten, harmful and does not produce any useful product (i.e. add value). (Isn't that what finance people do all the time, as their day job?) But does/should that in itself make the practice unlawful?

Playing devil's advocate here, I go to a garage sale and score an original Rembrandt painting for $25 from a little old lady who doesn't realize its true market value. I now own 100% of the world's supply of this particular painting (as there is only one). I put it up for sale at $10 million. Am I a criminal?

Re:Why is it illegal?

[shutdown -p now]

But does/should that in itself make the practice unlawful?

Probably not - I don't see any way to actually enforce this without too much "collateral damage".

Re:Why is it illegal?

[kramerd]

Are you mentally retarded?

Locking a ticket to a person is nothing like DRM. A ticket is not a digital issue. A performance is rent, not purchase. You aren't buying the right to watch a show forever (thats called a dvd, or a download, and requires a server), just when its live. You are purchasing an experience, like food. You get it at a specific time and place. You show an ID to buy groceries (if you use a credit or debit card), so it shouldnt be a big deal to show that you are the person who purchase a ticket.

Under my suggestion to combat scalping, you would not need ID to purchase a ticket, you would need one to attend an event. This is already implemented. A show is just like a steak; you bought it, you should be the one to eat it. If you hold a bbq (performance), you can decide who attends and who eats (attends). When someone else hosts, you can't invite yourself. Likewise, if you bought a ticket to attend a performance, you should be the one who attends. This idea is just saying that even if someone buys you a ticket, they put your name on it so no one can rob you in line and go in (and more importantly, no one can buy all the tickets and make you pay multiples of the price they paid).

I do not agree with a dutch auction, and you have absolutely no basis for coming up with such a conclusion. I believe in a free market, in which performers can decide which venues in which to perform, part of which is determinate upon their personal gain and part of which is determined upon how the prospective audience will be treated in its ability to attend and enjoy such performance (there certainly will be other considerations, but that's the basis of a free market :) ). For you to come to any other conclusion is absurd.

Again, you are retarded, because I gave you no connection between small town shows which tend not to have scalpers and performances that have scalpers which cause sellouts with significant numbers of empty seats.

Your mother must have raised you incorrectly to even try this logical fallacy. I must insist that you stop committing fallacio (its a legal term). Shame on you. I am done with your stupidity.

Re:Why is it illegal?

[MrKaos]

Thank you for trying Enry.

Re:Why is it illegal?

[metaforest]

Maybe you could read the Indictment and be illuminated on their technique, and why it led to a massive string of Federal charges.

It exploited a feature of the TM system that allows a potential customer to "hold" a ticket selection long enough to enter their CC digits and confirm a sale. These bots would lock the system up by breaking through the CAPTCHA and then holding hundreds to thousands of ticket selections in limbo while their sales agents haggled with ready and waiting "brokers" for the best seats. Legit customers were locked out of the best selections until the brokers put in their orders for the tickets "held" in limbo by Wiseguys' bot array.

IRL, I suppose an equivalent would be a bunch of Thugs storming the ticket office just as it opens, and then barring the doors to the remaining crowd. The clue free ticket agent ends up selling all the best tickets to the thugs and their "friends." The raiding crew then exits through the fire doors... Neither the ticket agent or the legit customers are quite sure what just happened... awareness of the screw-job only becomes apparent later.

So far as I can tell from some of the details in the indictment Wiseguys were a big target because they were very successful at implementing their exploits, and profiting from them.

TicketBastard, et al, are perfectly within their retail rights to set prices, terms for sale, use for their tickets based on their agreements with the venues and artists. The ticket is in effect a temporary lease to a specific part of a PRIVATE VENUE for the purpose of witnessing a specific event.

What is unfair is that Wiseguys methodically and maliciously violated TicketBastard's and other's TOS, and screwed their customers out of the best seats by end-running the system that attempted --however poorly implemented it was-- to give legitimate customers a fair shot at the best seats in the house.

By interfering with TicketBastard's (et al's) direct relationship with their legitimate customers, Wiseguys deprived an unknowable (but large) number of consumers access to goods and services that they had good reason to expect they would have access to, and at a fair (even if artificially set) price. While TicketBastard, et al do not lose revenue, they lose good-will if their "first come; first served" system is perceived by potential customers as exploitable by scalpers, or simply unfair by some unknown influence.

Other's who claim that Wiseguys did not engage in theft or (possibly malware) have not read the Indictment carefully. There are specific charges that they stole code from ReCAPTCHA servers, and also from various authorized ticket vendors to assist in defeating their attempts to enforce TOS on their services. They also appear to have acquired "back-door" access to one or more of the ticket vendor's systems to gain exploit information and possible market information to "build" their attacks.

That Wiseguys' 'bots' did not make use of malware to obtain computation resources is beside the point. If anything it shows that they were careful to avoid direct ties to unquestionably illegal computing resources.

Heck you can go to any number of "freelancer" sites and find employment offerings that are basically thinly(or poorly) disguised attempts to trick/encourage skilled programmers into working on elements of any number of morally questionable projects. I think the current freelance market is rife with potential legal risk for well meaning, and naïve professionals to end up working for some self-styled "Guido."

Re:Why is it illegal?

[metaforest]

Or even easier..When your site is setup to limit how many tickets can be bought per session or person, change it to limit how many tickets can be bought per credit card. You really don't think these guys had 5,000 credit cards to buy 20,000 tickets at a time, do you?

Seems it would have been trivial to block by ticketmaster, if they ever cared.

If you actually read the Indictment you would know that they and their brokers used every method they could think of to get control of enough credit cards and snail-mail addresses to avoid attempts by ticket vendors in filtering out exploitive purchases.

Re:Why is it illegal?

[metaforest]

Sorry to reply to myself... but this gem just popped across my mail o.0 From a popular freelance site:

Profile ID: 1177190 matches...
Title: Ticketmaster UK ReCAPTCHA
Project ID: 592566

Category: Programming & Databases
Description:
We are looking for a bot which will work its way through the ticket purchasing process on www.ticketmaster.co.uk,including:
1) Selecting the number of tickets
2) Selecting "Best available tickets" and "Best available section" - these are the default search options so the bot should not change alter these.
3) Writing out the captcha to a minimum 70% success rate
4) Once the ticket selection is available, we would like to receive an email notification to notify us that tickets have become available for that URL. Please note that we are NOT looking for a programme that will go through the payment process.
5) If the URL is for an event which has sold out, we would like the bot to continue searching automatically all day long.
We would like the programme to have the capacity to search through 100+ URLS throughout the day so it must be designed to handle such processing. It is also vital that the bot has some sort of IP hiding mechanism embedded into it. This could be in the form of a proxy or you can make other suggestions. This is a vital point as www.ticketmaster.co.uk has various ways of detecting such bots and the programme will just stop working.

Need I say more....

Re:Why is it illegal?

[MrKaos]

Please explain economics to me then. I have bought nearly all my tickets from scalpers at less than face value so I don't think I'm wasting money.

Perhaps the simple explanation is you go to gigs that never sell out. This means the scalpers are forced to sell the tickets at below cost to re-coup their initial investment.

Most high demand concerts that I've seen price their tickets in such a way that there are not enough to satisfy demand at that price even if every ticket was purchased by a person going to the show. So that means at face value of the ticket demand will not be satisfied and equilibrium will not be reached.

Well it's bums on seats, and if you consider that the box office just want the tickets sold to cover costs and that they don't care who buy them then perhaps the scalper is part of their market. What has changed is that the scalper is now a dominant part of the market and is able to effect the overall cost and availability of ticket purchases. Because the average ticket purchaser does not invest in $5 million worth of software to buy tickets they are disadvantaged from the outset. Thus the gig is artificially sold out and the ticket price is artificially raised.

This is what happens in the commodities markets, it's not economics 101 - it's called price gouging. The box office sells out a concert - which mitigates their risk and the scalper engages the risk to generate profit. The disconnect is between the Bands who miss out on earnings and the Fans who pay more for tickets, the brokers however profit nicely and their mutual expense.

Taken to the next level, this is what the music industry does to bands and fans except they lobby for laws to protect their obsolete business model while the box office and scalpers rely on apathy to protect theirs. If *all* bands and gigs were sold in a business that disallowed a box office or scalpers you would see a similar hand waving and gnashing of teeth from them as you do from the RIAA.

Pretty basic economics (think what happens in rent control).

Except it's not really, the scalpers have a software mechanism to buy tickets and I do not. This means that they have asserted a coercive monopoly control over the supply and demand. This means that the equilibrium can never be met because so called "market efficiencies" are biased towards demand.

Dumping the scalpers will not change supply one bit (it won't suddenly add seats to the event).

Yes it would, you're assuming that everyone who would buy a ticket at %100 percent of the cost would buy it at %250. You're also assuming Scalpers sell *all* the tickets where they only enough to cover their costs and make a profit. Of course they *want* to sell all the tickets but at >%200 of the cost the scalper only has to sell *half* of the tickets they purchase to make a profit. So getting rid of Artificial scarcity *would* increase supply. I have been to sold out gigs where there were clearly plenty of seats available.

What I think we'll eventually see is all tickets will be sold auction style. When the organizers see scalpers making this much money on under priced tickets they will want in on it. When that happens I'm sure the same people will cry about tickets costing too much but then they won't have the scalper boogeyman to blame.

Perhaps, but getting rid of Artificial Scarcity would indicate to the organisers that perhaps they need to book a bigger venue for their show so they can satisfy a larger demand. Artificial scarcity limits earnings for a vendor who is essentially trying to move more product (in this case seats) to their target market. Fewer people buy tickets overall if they above what the market will bare and organisers have no w

Re:Why is it illegal?

[amicusNYCL]

It doesn't work when the scarcity is artificial.

Re:Why is it illegal?

[amicusNYCL]

Is it fair that the jobless guy who can camp out for weeks gets a ticket and I don't because I'm working?

Of course it is, if he wants to waste his time waiting then he can do that. If he wants to spend money instead of making it, great, go for it.

And since I'm willing to pay more than the next guy why shouldn't I be allowed to buy a ticket from whomever?

You are allowed to buy a ticket from whomever you want. Assuming, of course, that they're willing to sell their tickets.

Price fixing generally requires cornering the entire market. Find me a scalper who is buying 20k-30k seats at venues and fixing the price.

When a scalper buys 883 of the 1000 available tickets for an event like the Rose Bowl, you can consider the market cornered.

Re:Why is it illegal?

[tompaulco]

What competition? These people aren't printing tickets and underselling the vendors. They are buying up all the tickets and then reselling them at more than face value. One wonders why the vendor even cares since they have made their money. But the truth of the matter is that it is bad for the vendor's business when the only tickets available to the average Joe are at much higher than face value. The average Joe wants the vendor to do something about it so that he can buy a ticket at the price which he is willing to pay and that the vendor is willing to sell it to him. This is why the business model says "no reselling". It is not a failed business model. It's just that some people are breaking the agreement that was enacted when they purchased the tickets.

Re:Why is it illegal?

[thickdiick]

Scalpers provide a very useful service because they prevent shortages. If i want a ticket, i can buy one without having to worry that they ran out of tickets.

Re:Why is it illegal?

[shutdown -p now]

They don't prevent shortages, since the amount of tickets is fixed, and can only be "increased" by offering more venues. The only things scalpers do is shift around the category of people affected by said shortages to those with less money. And this isn't even mentioning that shortages are in part caused by scalping practices in the first place.

Re:Why is it illegal?

[EastCoastSurfer]

Locking a ticket to a person is nothing like DRM. A ticket is not a digital issue. A performance is rent, not purchase. You aren't buying the right to watch a show forever (thats called a dvd, or a download, and requires a server), just when its live. You are purchasing an experience, like food. You get it at a specific time and place. You show an ID to buy groceries (if you use a credit or debit card), so it shouldnt be a big deal to show that you are the person who purchase a ticket.

The DRM analogy was how DRM locks a digital asset to a single person or device in order to maintain control. By locking a ticket to someone they are doing the same thing. And no, I rarely show ID to buy food. I use cash 99% of the time.

Again, you are retarded, because I gave you no connection between small town shows which tend not to have scalpers and performances that have scalpers which cause sellouts with significant numbers of empty seats.

You're the one who brought up small cities in a previous post and mentioned they have no problems with scalpers. I'm not sure that in larger cities artist will ever quit showing up because of scalpers. There is just too much money to be had in larger cities.

I believe in a free market, in which performers can decide which venues in which to perform, part of which is determinate upon their personal gain and part of which is determined upon how the prospective audience will be treated in its ability to attend and enjoy such performance (there certainly will be other considerations, but that's the basis of a free market :) ).

I'm not sure how you can believe in the free market and then want to limit my (or anyone else's) ability to re-sell a ticket, perhaps even for a profit. Why can't I sell my steak to someone else? Did you ever sell lemonade as a kid? Those kids bought those lemons so they should eat them. How dare they sell the for a profit. That is about as anti-free market as it comes.

You seem to be so worked up about defending your position (the name calling is really unnecessary) that you quit thinking about what you were writing. I'll go ahead and link to some papers/sites about scalping and how they help clear the market (and that the main driver is prices set too low to begin with):

Ticket Scalping
Dynamic Ticket Pricing
Scalping

Re:Why is it illegal?

[EastCoastSurfer]

I'm not sure why I'm even arguing anymore. There are plenty of economics papers that fully explain scalpers and how they help clear the market. Very few economist think scalping should be illegal because they recognize the scalpers are serving a market. I'm paraphrasing, but Dan Seligman of Forbes once wrote that having laws against ticket scalping was in the top ten dumbest ideas of the century.

The primary cause for scalping is underpriced tickets to begin with.

This is what happens in the commodities markets, it's not economics 101 - it's called price gouging [wikipedia.org]. The box office sells out a concert - which mitigates their risk and the scalper engages the risk to generate profit. The disconnect is between the Bands who miss out on earnings and the Fans who pay more for tickets, the brokers however profit nicely and their mutual expense.

Price gouging is tough to do unless you a) have a majority of the tickets and I haven't seen any scalpers with the ability to buy 20k-30k seats that many venues have and b) have something for sale that people are forced to buy. Generally the term price gouging is used during emergencies when people are forced to by food at an increased price. Finally, even your own link has comments from economist against ANY restrictions on price.

Except it's not really, the scalpers have a software mechanism to buy tickets and I do not. This means that they have asserted a coercive monopoly [wikipedia.org] control over the supply and demand. This means that the equilibrium can never be met because so called "market efficiencies" are biased towards demand.

So a single scalper is holding all the tickets or are you saying they are all in collusion? I think the original story said that the scalper had 2k seats to sell over the course of the Yankee playoffs. Yankee stadium holds 50,086+ people. So either the scalper was in collusion with all other scalpers or he was simply selling tickets at market value. I think it's much more likely he was selling at market value.

Yes it would, you're assuming that everyone who would buy a ticket at %100 percent of the cost would buy it at %250.

Um, that's demand change and has nothing to do with supply. There are a fixed amount of tickets from the start. They are usually under priced (nearly every scalping economics papers on google talks about this) so demand outstrips supply.

You're also assuming Scalpers sell *all* the tickets where they only enough to cover their costs and make a profit. Of course they *want* to sell all the tickets but at >%200 of the cost the scalper only has to sell *half* of the tickets they purchase to make a profit. So getting rid of Artificial scarcity *would* increase supply. I have been to sold out gigs where there were clearly plenty of seats available.

Now a scalper may try to hold tickets back, but again to do this en masse you would need all the scalpers working in collusion. The arena in Phoenix that have made a scalper section that helps protect against this.

And only a poor scalper would not sell all his tickets. It doesn't matter if he's already profitable, any tickets left in his hand equals a loss.

Re:Why is it illegal?

[EastCoastSurfer]

You should try reading some economic papers on scalping sometime. Most that I have read agree that the scalpers are simply helping clear the market because the event typically sets prices too low considering the real demand.

Some of the more interesting papers try and figure out why the event is priced so low to begin with and most end up saying the best way to 'fix' scalping is to raise event prices from the start.

I'm sorry if that doesn't fit with your view on how economics works, heck even wikipedia says what I've been saying for pages:

Ticket resale is a form of arbitrage that arises when the amount demanded at the sale price exceeds the amount supplied (that is, when event organizers charge less than the equilibrium prices for the tickets).

And later (bolded is mine)

Individuals who genuinely wish to attend a popular event may find themselves unable to get tickets, as they have already been sold to ticket resellers. This practice enables the ticket resellers to sell the tickets at market value, with no effective loss because they had no intention of attending the event in the first place. On the other hand, if the resellers buy the tickets and the tickets are not then sold out, then they risk a loss.

I'll continue on not having a clue about market based economics.

Re:Why is it illegal?

[rinoid]

Not intending flamebait, but I'm not certain your first language is english. Where do I insinuate I want to outlaw scalping?!?!?!

I state "Gee, smells like unbridled capitalism to me."

Oh, maybe you were replying to the parent and not me? But I'm the one claiming to be a socialist libertarian.

Get your threads straight man! I hope you don't code for a living!

Re:Why is it illegal?

[somersault]

They'd also have to set fire to BK to make sure they couldn't make any more burgers. Scalping only works for situations where no more product (or very limited product) is readily available.

Re:Why is it illegal?

[MrKaos]

There are plenty of economics papers that fully explain scalpers and how they help clear the market. Very few economist think scalping should be illegal because they recognize the scalpers are serving a market.

So what. Economics isn't a science it's a branch psychology with many flaws. If a band like Pearl Jam says the price for a ticket should be $n so their fans can afford to go to the concert there should not be another market mechanism to change that price. The tickets are only a perceived value to those who want them and if the tickets are priced out of that market then the scalpers have only served to produce a part empty sold out venue and denied other revenue opportunities to the venue and the band which lowers the performers income over the duration of the performances.

Clearing the market is only a factor when tickets are the *only* profit generating mechanism for a performer.

I'm paraphrasing, but Dan Seligman of Forbes once wrote that having laws against ticket scalping was in the top ten dumbest ideas of the century.

Which Century, the twentieth or the twenty first century? Was he talking about street hawkers or the guy with $5 million worth of ticket buying software in 2010. The scalper AND the box office are parasitic by nature. You have ignored the point that scalpers price tickets outside of the target market and not all tickets will be sold effecting revenues of the venues and the overall revenues of the performer on tour.

The primary cause for scalping is underpriced tickets to begin with.

The value of the ticket is what 'the market will bare' not 'what the market *can* bare'. The value of the ticket is determined by the performer for a reason, not by a market mechanism that profits only the broker. The performer dictates the supply not the scalper, by putting on additional performances - and they do. Scalpers (operating in this way) distort the perception of demand to the performer.

So a single scalper is holding all the tickets or are you saying they are all in collusion? I think the original story said that the scalper had 2k seats to sell over the course of the Yankee playoffs. Yankee stadium holds 50,086+ people. So either the scalper was in collusion with all other scalpers or he was simply selling tickets at market value. I think it's much more likely he was selling at market value.

It's unlikely. It maybe market value for a sporting event, it's a one time event...

Um, that's demand change and has nothing to do with supply. There are a fixed amount of tickets from the start. They are usually under priced (nearly every scalping economics papers on google talks about this) so demand outstrips supply.

...but I'm referring to concerts and performances where supply can be increased. Perhaps that is the disconnect here.

And only a poor scalper would not sell all his tickets. It doesn't matter if he's already profitable, any tickets left in his hand equals a loss.

No, it equals a failure to maximise profits. A greedy scalper simply prices the tickets above what a punter can afford to pay and in that case only the box office wins by having sold all the tickets. The punter loses because they missed the gig, the venue misses out on beer and food sales and the band loses out on tee shirt and other merchandise sales. These factors affect the long term profitability of the performer and the venues. This directly affects supply of other gigs by distorting profit and sales forecasts for merchandise. These are proven profit centers for both performers and venues and scalpers consume that budget.

Maybe those who wrote the economic theory about scalpers haven't been to many concerts themselves and factored those parameters into their "equations". The generation of profit for the brokers as opposed to the profit of the performer and venue. Besides I wouldn't normally buy from a scalper simply because those tickets are usually too expensive.

Re:Why is it illegal?

[AmonTheMetalhead]

What part of using a botnet to swamp a server do you not understand? If you think it's a fair tactic to be used in the holy pursuit of money, fine by me, in the mean while, the law disagrees.

Re:Why is it illegal?

[ResidntGeek]

The scarcity comes from limited seats in the venue and a lot of people wanting to see the game. That's not artificial.

Re:Why is it illegal?

[amicusNYCL]

No, the scarcity comes from one entity buying all available resources and hording them. That's artificial.

Re:Why is it illegal?

[ResidntGeek]

If they're HOLDING them, their business model is obviously being poorly implemented. The point is, you're claiming there's no way, even in theory, that scalpers help anyone, which is patently untrue.

Re:Why is it illegal?

[amicusNYCL]

Oh no, scalpers definitely help people. They help themselves, and they help the wealthy. They don't help me though, and they don't help most other people either.

Frankly, they seem like the same type of social parasites who try to make money without contributing anything useful to society.

Re:Why is it illegal?

[ResidntGeek]

Do you know why we have money? Have you ever thought about its actual purpose?

Nobody is interested in helping you at the expense of those more wealthy than you. Why would they? The wealthy have more money than you. That's the POINT of money. Chasing money is not social parasitism, it's what makes the world go 'round. You want people to help you? Work your way up so you have more money and can pay them to help you.

Wiseguy?!

[mrthoughtful]

Any company calling itself "Wiseguy" is surely going to pull some heat. It's like having a prescription signed "Dr A. Fraud."

Re:Wiseguy?!

[deniable]

"Wiseguy" sounds like a family business.

Re:Wiseguy?!

[Anonymous Coward]

"Ever since I was little I always wanted to be a scalper."

Re:Wiseguy?!

[Anonymous Coward]

That's just plain discrimination, and you ought to be ashamed.
Sincerely,

Arnold Fraudliche

Re:Wiseguy?!

[mrthoughtful]

You don't say. Of the Sicilian flavour.

Re:Wiseguy?!

[Anonymous Coward]

I resemble that remark, you insensitive clod.

- Albert Fraud, P.h.D.

Well done.

[aerthling]

$25m seems an entirely adequate reward for circumventing reCAPTCHA.

Re:Well done.

[newdsfornerds]

SeattleGameboy sure knows how to make a point ;)
And hasn't CAPTCHA been cracked for something like a year?

I don't get it

[MichaelSmith]

'They wrote a script that impersonated users trying to access Facebook, and downloaded hundreds of thousands of possible CAPTCHA challenges from reCAPTCHA. They identified the file ID of each CAPTCHA challenge and created a database of CAPTCHA "answers" to correspond to each ID.

So how did they generate the answers? Did they brute force them with a dictionary search? Or was there some other technique their hired programmers used, but which was not described in the article?

Re:I don't get it

[aerthling]

They probably hired poor people do do it for them.

Anti scalpers scheme that works...

[BartholomewBernsteyn]

In his Glitter and Doom tour, Tom Waits pioneered an effective anti scalpers scheme.

Tickets for Waits' summer shows were limited to two per person but, in an effort to beat ticket touts, a valid I.D. (passport or driving licence) matching the name on the ticket was required to gain entry. Any concert-goer who did not have a valid I.D. or was found to be in possession of a ticket that had been resold – electronic scanners were employed – was not allowed in and did not get a refund.

From http://en.wikipedia.org/wiki/Glitter_and_Doom_Tour#Tickets

Re:Anti scalpers scheme that works...

[Canazza]

That wouldn't stop scalpers. Idiots would still buy them, especially if they claimed that these tickets didn't need ID.

The buyer wouldn't get into the concert, be out of pocket, and the scammer would have upped and legged it long before.

Re:Anti scalpers scheme that works...

[AmonTheMetalhead]

The problem in Belgium & the Netherlands is that, while tickets are on a name, there is no ID check whatsoever (however, they did do that for the AC/DC concert last year), the problem is, the people who want to see the concert are prevented by the scalpers to even get a ticket

Re:Anti scalpers scheme that works...

[noackjr]

Tickets for Waits' summer shows were limited to two per person but, in an effort to beat ticket touts, a valid I.D. (passport or driving licence) matching the name on the ticket was required to gain entry. Any concert-goer who did not have a valid I.D. or was found to be in possession of a ticket that had been resold – electronic scanners were employed – was not allowed in and did not get a refund.

If you RTFA (I know...), you'll note:

The perpetrators took orders from ticket brokers, who were required to provide credit card numbers and account holder names in advance of a purchase so they could be programmed into the bot.

All they would have to do to defeat the ID requirement is add that to the list of items they need to purchase the tickets. And people would still pay extra to them because 1) they wouldn't have to try very hard to get a ticket, and 2) they would have a much higher chance of getting a ticket.

Re:Anti scalpers scheme that works...

[Anonymous Coward]

I think having Tom Waits on the ticket was the effective anti scalping method. If there is no demand and plenty of tickets available there is no scalping.

Re:Anti scalpers scheme that works...

[Anonymous Coward]

The name check is coming. And scalpers will be left with unsaleable merchandise which will drive them out of business.
If you were in the buying and selling business of bananas and you could not sell your product you'd have to be pretty stupid to keep buying more , right ?

Re:Anti scalpers scheme that works...

[gnasher719]

In his Glitter and Doom tour, Tom Waits pioneered an effective anti scalpers scheme.

A different, simple scheme that benefits the artist: Once the venue is sold out (say 90% to scalpers) announce another concert on the next day. If that gets sold out, do another and so on. Result: Lots of money for the artist, who will play in many sold out but mostly empty halls. No money for scalpers.

Re:Anti scalpers scheme that works...

[Richard_at_work]

Pioneered? Glastonbury Festival (a huge music and arts festival in the South West of England) has been doing this for years - tickets are issued to named persons with photos being printed on the ticket, and that person has to show official ID on entry along with the ticket. Named and details are checked against the ticket and the purchasing database, and any negative matches are turned away.

Re:Anti scalpers scheme that works...

[Anonymous Coward]

it's piss easy to get tickets for glastonbury. get yourself put on the electoral register for the surrounding area. most years, they give tickets to local people as compensation for the noise and inconvenience.

Re:Anti scalpers scheme that works...

[Anonymous Coward]

Sounds good but the kind of artists that attract scalpers are already on perma-tour schedules anyway.

Re:Anti scalpers scheme that works...

[rwv]

That wouldn't stop scalpers. Idiots would still buy them, especially if they claimed that these tickets didn't need ID.

It's a long-term solution. Eventually people would learn not to buy from scalpers under any circumstance. The stupid assholes who pay money to scalpers without getting to see their show would be a collateral damage. As somebody who doesn't shop for goods-and-services from criminals, I'd welcome the opportunity to see these people who do get fleeced.

Re:Anti scalpers scheme that works...

[jecblackpepper]

That might be true when it was introduced, but once it becomes the norm, you'll significantly reduced the problem of ticket touts. Yes there will still be some idiots, but they are also the same idiots who are likely to be scammed by counterfeit tickets.

Re:Anti scalpers scheme that works...

[aminorex]

Cool, so now you need state papers to attend a Tom Waits concert. Tom Waits can take a hike.

Re:Anti scalpers scheme that works...

[DaleSwanson]

This is a pretty good idea. It effectively removes the scarcity imposed by the fact that venues must have limited capacities (however it's also limited to events that can be reproduced endlessly, so it wouldn't work with sporting events). One problem though is that most tours are planned as a whole and adding multiple dates in each city dynamically as sell outs occur would mess this up. To some degree you could solve this by matching the on sale dates to the event dates. Come up with the order of cities then 6 months out put the first city's tickets on sale for the first day. If they sell out in the first day then you add a second day in that city and start those sales the next day. Whenever they don't sell out in the first day on sale the next day you begin sale in the next city on the list. This way every day a new city's tickets go on sale for an event with a known date 6 months in advance. While this solves the technical problems I'd imagine that in practice there would be other problems (like wanting to play certain cities on specific days).

Re:Anti scalpers scheme that works...

[metacell]

Possibly, but with time people would learn not to buy from scalpers.

Re:Anti scalpers scheme that works...

[jandrese]

You really have no idea how venues work do you? You can't just say "Oh, I need another week worth of shows" once the tickets start to go on sale. The Venues have been booked up for months by that point. You also have appointments in neighboring cities a couple of days later. Artists don't just show up at the Pepsi center and go "I'd like to have a concert on Wednesday."

Re:Anti scalpers scheme that works...

[Anonymous Coward]

So I guess if someone gave me their tickets or I received them as a gift or a work bonus or something like that the guards would 'confiscate' my legitimate tickets, turn me over to the cops and say 'Sucks to be you'?
Yeah, sounds like it works.

Re:Anti scalpers scheme that works...

[Anonymous Coward]

Keep in mind that concert halls, convention centres, etc. are companies too. They have to do their best to get the venue booked 100% of the time. They can't just wait and see if one of their customers books their location for another show. Not to mention that selling tickets at a single days notice is most likely going to fail.

Everybody needs time to plan to conduct, host and visit a concert, i.e. bands, venue owners and fans.

I wouldn't be surprised if the next date you could get for such an idea was 6-12 months later at best.

Re:Anti scalpers scheme that works...

[matt20102]

I would actually stop doing business with any artist that used that system- for two reasons:
1) I refuse to give my name and identity just to see a concert, and
2) The system assumes that it is wrong to resell tickets.

Ignoring any thoughts about reselling tickets at higher than face value (for which there should be no issues), there is absolutely nothing wrong about reselling tickets below face value. This sledge-hammer approach reeks of disrespect for the concert-goers ("Who cares about the fans who might have bought a ticket from a friend or received it as a gift, we're gonna get those $#&@! scalpers!")

Re:Anti scalpers scheme that works...

[Anonymous Coward]

One way to beat the large scalpers would be to simply cancel the occasional show and only offer a limited number or refunds per address for tickets. I'm sure just the shows that are canceled for valid reasons would suffice.

Re:Anti scalpers scheme that works...

[Jay L]

At that point, though, are they even scalping? I hate scalpers, but if they're taking specific pre-orders for specific concerts from specific people, what differentiates them from paid line-standers?

why browser knows captcha id

[tokul]

why user agent knows all info required to identify captcha and why this identification info is unique. Somebody designed weak captcha system and it was broken. End of story.

Re:why browser knows captcha id

[Anonymous Coward]

Umm....I'm gonna go out on a limb here and say: MD5

Re:why browser knows captcha id

[CarlDenny]

It's easy enough if you have a fixed pool of captcha images.
Generate a hash of each one, call the hash an ID, done.
If push comes to shove, just compare the images pixel by pixel, that won't really slow things down.

You *have to* present the image to the user somehow, and the image file can easily be used to do a lookup.

Re:why browser knows captcha id

[Anonymous Coward]

*chop*

Dutch Auction

[Dr_Barnowl]

How about a dutch auction?

Start the price offensively high, and drop it as the concert date approaches. The organiser gets paid the price the market will bear, the scalpers are out of the loop - because by definition, anyone willing to pay a stupid price for a guaranteed ticket will already have paid it.

You still get the same effective problem - that rich fans are prioritised over poor fans, but more money goes to the artist and the organiser, so they could throw a few benefit concerts or something to sweeten the deal.

Re:Dutch Auction

[twisteddk]

I like the idea, but for all practical intents it's almost impossible to do.
Because you'd then have to auction off each seat in an order determined by order of importance, which would be logistically a nightmare with up to 100.000 seats available for an event.

For instance: I can afford to pay $500 for two tickets to a concert, but I want the best possible. If I wait for the best tickets to drop in price, they may sell out before they reach the pricelevel I'm willing to pay, so I need to buy the second best tickets, but these sold out at $100 even earlier. So the company sells a pair of tickets at $100 that it could have gotten $500 for. so they have to sell each seat (or section) before they sell the next to get the best price. Thus the guys dealing in the "resellers" market still get to earn a living, because this is impractical to do.

Rather each buyer could enter a maximum value they'd be willing to pay, and then those with the highest bids would get the best tickets and so on downwards. But again, this would mean people will bid lower than what they really wanted to pay, because the percieved value of the ticket drops with its desirability (like locatin, seating, visibility etc.) and with no guarantee of a desired location, you'd bid only what you percieve the worst tickets to be worth. And thus a new black market will appear.

I dont see a better way (and equally simple for both costumers and sellers alike) to do it than with the current fixed pricing schemes.

Re:Dutch Auction

[jlebrech]

wish I could MOD you up.

It could also, lower the server load when new tickets start to sell.

Re:Dutch Auction

[oever]

The 'clock' in a dutch auction takes about 30 seconds to go to zero. That means that a sequential auction for 100.000 tickets would take about a month. That should give all people interested ample opportunity to attempt to buy a ticket at the desired price.

However, just like the stock exchange, the day price of a ticket would depend on psychological factors. That means that the price would fluctuate and the a price that is perceived high one day is percieved low another day. This creates opportunity for ticket trading.

A better system for the artists would be to do parallel ebay-style bidding. You start by bidding $10 and if there are less people bidding more than $10 than there are tickets, you get a ticket. At a specified time the bidding is frozen and you either have a ticket or not.

For the concert-goers, this system has the disadvantage that they are not sure of a ticket until the bidding expires.

Re:Dutch Auction

[jlar]

Because you'd then have to auction off each seat in an order determined by order of importance, which would be logistically a nightmare with up to 100.000 seats available for an event.

I don't think that is true. They can just let a succesful bidder choose whatever remaining seat he wants. The seller does not have to decide which seat is the best for you. That way you can just wait until the price falls to $250 per ticket and grab the best seats available.

Re:Dutch Auction

[Registered Coward v2]

How about a dutch auction?

Start the price offensively high, and drop it as the concert date approaches. The organiser gets paid the price the market will bear, the scalpers are out of the loop - because by definition, anyone willing to pay a stupid price for a guaranteed ticket will already have paid it.

You still get the same effective problem - that rich fans are prioritised over poor fans, but more money goes to the artist and the organiser, so they could throw a few benefit concerts or something to sweeten the deal.

The problem is promoters and talent want two things - sold out venues and maximum price per ticket. Scalpers act as a hedge against lost sales and inaccurate demand / pricing - they take the risk of getting stuck with tickets or losing money; something promoters don't want to accept themselves. Dutch auctions would probably condition people to wait because they learn prices will fill - which causes prices to fall - and promoters have no idea how much money they make nad when. They hate scalpers because, in their mind, they are taking "their" money; and convenientlyignore the risk mitigation role.

Laws barring reselling of tickets, IMHO, merely serve to restrict the market and raise ticket prices overall so promoters can make more money. There is no rational reason to bar ticket reselling anymore than to bar reselling of any other good.

Re:Dutch Auction

[Mr. Tobes]

I dont see a better way (and equally simple for both costumers and sellers alike) to do it than with the current fixed pricing schemes.

Any ticketing system you can dream up will be pretty inefficient due for three major reasons. First you are dealing with pretty much the prime example of an inelastic supply of goods. It's rare that bands have sufficient space in a schedule to add an extra night if a concert sells out. Conversely, you can't suddenly downgrade to a smaller venue if tickets don't sell. Hence bands tend to book smaller places that they know they can roughly fill.

Second there is the scheduling problem. Big tours are announced months in advance. You are always going to get some people who book a ticket and then genuinely can't make the show. Due to the current chain of band, venue, and ticket agent returning tickets is pretty rare.

Finally, you have the problem that fans are pretty irrational. They whine if tickets are priced high, but then pay anyway. They whine if the venue isn't packed. They whine if it's sold out and they 'have' to pay a scalper. They whine when their favourite band hits the big time and they can't see them in a small venue any more. My friends and I have done all of the above at one point or another.

However, I'm not convinced that the current system is better than some form of auctioning system. Yeah, it would have drawbacks as you've stated, but auctions have been the traditional way of selling inelastic goods just about forever. After all, it's pretty much what the scalpers do - try hanging around a venue for a few hours before a show and see how the price of selling/buying goes up and down. In fact, I'm pretty surprised that one of the larger venues/bands in the world has not tried some form of auctioning scheme yet simply to bypass the scalpers and pocket the profit themselves. It would certainly be an interesting experiment. I suspect that the only things holding them back are fan perception - I'm guessing the bands don't want to be seen to rip the fans off any more than they do already - and turf fights between the venues and ticket agents as to who would actually hold the auction. Just my two cents.

Re:Dutch Auction

[Anonymous Coward]

Two problems:
Brand loyalty
all your most dedicated fans are now going to either pay outrageous prices for admittance or run the risk of missing shows
Last-minute-buyer profits
you wouldn't be able to overcharge the people that try to buy tickets the day of the event

I guess you could solve that by getting a "frequent buyer" benefits program and establishing a 200% markup on "day-of" tickets.

Though, personally it would annoy me to buy tickets this way; having to try and gamble for the lowest price.

Re:Dutch Auction

[jonadab]

> If I wait for the best tickets to drop in price,
> they may sell out before they reach the pricelevel
> I'm willing to pay, so I need to buy the second best
> tickets, but these sold out at $100 even earlier.

This is easily solved, and along with it the problem that some people might rank the seats differently than others (e.g., one guy wants to be right in front of the speakers, and somebody else would rather be near the center of the stage).

The solution is simple: all the tickets are the same price on any given day. Let's say you start selling the tickets 100 days before the event, at ludicrously obscene prices (say, a million bucks a seat). You wait, because you don't have a million bucks, and if you did you wouldn't spend it on tickets for a single concert, because you're at least partially sane. So you wait. Each day the price goes down. After a week or so, it's down to eighty grand per seat, which you still can't afford, but only four tickets have sold, to some billionaire who just had to be next to the center aisle in the front row no matter what. When the price comes down to twenty grand per seat, a couple of CEOs snap up the private VIP booth, and a lunatic-fringe extreme fan from Ann Arbor sells his truck and buys a front-row seat. But there are still seats available in the front row, and the price is coming down...

Furthermore, this system and the current system aren't necessarily mutually exclusive. They could split up the seats in a predetermined way and sell some of them at fixed prices and others in the manner described above. The proportions (how many tickets are sold each way) would be up to the organizers of the concert, I suppose (though it might also be a negotiating point when you're trying to book popular performers).

For simplicity, we'll say you divide the seats in half down the middle of the center aisle. All the seats left of center are sold for the same low price of $150/seat (or whatever) until they're gone, but the seats to the right of the center aisle are priced obscenely high at first, and then the price gradually drops until they're all sold out (probably somewhere in the $250-$500 range, though of course the exact price is going to depend on the popularity of the performers and various other factors).

Re:Dutch Auction

[BlackHawk-666]

This makes plenty of sense. In any concert there are bandings of seating with a price attached. The better the view, the more expensive the seat. This is worked out in advance by the venue based on their 'values', but really it is the view and values of the ticket holder that matter.

So, price starts at $1 million and slowly drops as the cut off date for purchasing a ticket approaches.

If the guy who spent $1 million for his seat wants to sit to the left side of the back row - who are we to tell him he can't have that seat. The price of the seat drops until you feel you can afford it and check - nope, you don't want to pay $500 for the seats left, but in two hours time it's $200 and there's still a few left you'd pay that for.

You could automate it by placing a highest bid price label onto each of the seating brackets and let a script pick you up a seat when it hits your price. If you're feeling risky, you could wait a little as seats in that area sell out - snapping a couple up at the last moment.

Concert providers should be happy, this would pretty much enable them to scam the maximum amount available for every seat in the house.

Re:Dutch Auction

[Anonymous Coward]

That would never work. Have you never been to a concert? Demand for tickets increases as the event approaches. Most people don't know well in advance whether they'll be able to go or just can't decide but as the date gets closer, an increasing number of people do decide and also, as there's more publicity about the upcoming event, more people become aware of it. And you know what the logical action for any business is when they have a finite supply and increasing demand. That (and the need to have money to cover some costs early) is the reason why tickets are often sold (legitimately) with schemes like price X until two months before the event, Y until one month and then Z, where X<Y<Z. With your proposed system prices would be high when demand is low and low when demand is high.

Now, since sometimes it should imho be perfectly ok to resell a ticket, such as in case you have one and for some reason simply cannot go. But to solve that (and give organizers more profits), I'd implement a system that if (and only if) an event is sold out, those who still want tickets, can sign up to a queue and then allow people who have tickets but can't go return theirs for a refund. Then the organizers could demand ID that matches the name on the ticket and both allow people who cannot go "resell" theirs (with no profit) and be able to make more profits from the event (if a paid refund is X they can then sell the ticket to someone signed up in the queue for Z or maybe even a little more just to cover the cost of processing the refund).

Re:Dutch Auction

[halcyon1234]

How about no ticket pre-sales at all? You show up at the door, buy a ticket, and immediately enter the venue. If you're buying tickets for a group of friends, they need to be with you.

If the venue needs to bump up the ticket price by 5% to make up for the present value they won't be getting with a pre-sale, fine. Better than then 250% scumbag markup that currently exists.

Re:Dutch Auction

[Rolgar]

For the concert goer, this is the incentive to pay as much as they are willing to pay, and if they don't get it, they shouldn't feel bad because they obviously didn't value the experience as high as the other bidders. Of course, the higher bidders should get better seats so you don't have the richer people who can afford (or are willing) to pay 10x the price will have an incentive to bid that price instead of trying bid just above the minimum, and hoping they get a good seat by lottery. Some teams in the US pro leagues have already started doing this, both on season tickets, and then for single game tickets for high interest games where scalpers are likely to make premium prices.

Re:Dutch Auction

[rho]

I doubt that most of the "scalped" tickets are actually sold by scalpers. Most are probably sold by friends and employees of the event and/or venue.

Think about it--before tickets go on sale, roadies and janitors get a chance to buy premium seats at face value, maybe even with an employee discount. The performers don't care, the venue doesn't have to pay employment taxes on this unofficial employee benefit, and the employee gets some extra cash.

Re:Dutch Auction

[jandrese]

Venues already know what seats are best. That's not a problem.

Re:Dutch Auction

[jandrese]

The scalpers would just write a bot to bid in every single auction.

Re:Dutch Auction

[Anonymous Coward]

What about a "linked" sealed bid system with cutoff price. Basically, the organization enumerates the event sections, including number of seats and cutoff price. Then, people is allowed to make sealed bids for each section, in order of preference. Finally, at the expiration date, you only have to discover an algorithm that solves the (probably NP-hard) problem of choosing assignations and you're done. You might try to contact people doing research about combinatorial auctions :P

Re:Dutch Auction

[archangel9]

You show up at the door, buy a ticket, and immediately enter the venue.

Even a small venue of 12,000 people would take forever to load up. Assuming 50% cash and 50% credit debit, even if the cash purchases take 20 seconds and the debit 45 seconds, it would take 108+ hours to process those tickets to gain entry. Even if this small venue had 40 ticket windows (doubtful, it's the average size of a college basketball stadium), it would still take 2.7 hours per window if everything went perfectly.
Good luck with a major stadium concert.

Re:Dutch Auction

[halcyon1234]

Hmmm, good point. Back to the drawing board on that one.

Re:Dutch Auction

[Registered Coward v2]

I doubt that most of the "scalped" tickets are actually sold by scalpers. Most are probably sold by friends and employees of the event and/or venue.

I really don't know what percentage is insiders vs ticket brokers - though I'd bet some of the insider sales go right to a broker since if you had a steady supply you could build a profitable two way relationship.

Think about it--before tickets go on sale, roadies and janitors get a chance to buy premium seats at face value, maybe even with an employee discount. The performers don't care, the venue doesn't have to pay employment taxes on this unofficial employee benefit, and the employee gets some extra cash.

I'm not sure I agree with the don't care part - in the end they "lose" money; as a result I'd be surprised in low level insiders got more than a small percentage of the seats available. If they could get larger amounts it would be in their own interest to become a broker.

In the end it comes down to cash - promoters and talent see brokers making a lot of it and want a piece of the action. I'm surprised no one has gotten a state to pass a "fair share" law requiring brokers to give back a cut of their profits. Of course, the original sellers wouldn't have to issue refunds for tickets that the brokers took a loss on; after all the promoters and talent want rewards without the associated risks.

Re:Dutch Auction

[Necroloth]

yes, a 10,000+ long queue is ideal

Re:Dutch Auction

[CarlDenny]

Huh? The whole point is that you don't sell any $100 tickets until people have passed on paying $500 for any of the available seats.

You don't have to sort the tickets by order of importance, let the market do it. Put up a web site with all the available seats, starting at $1000. If someone wants to pay a premium for nosebleed seats, let em. You end up paying for the best seats you can find at the price level you want, *or* paying for the seats you want at whatever price it takes.

The site should be set up for people to say beforehand, I'll pay $100 for any of these seats, $50 for any of those seats, and so on. When the price hits that level, they'll get their tickets (if any are left.)

Re:Dutch Auction

[kramerd]

The problem with that is that some events are popular (like sports and concerts). I know I am not going to fight the Friday night traffic in a big city, pay the $20 for parking, and then wait in a giant line for a couple of hours (days?) only to find out that the last ticket was sold 45 minutes ago and this line is actually for the bar next door that is showing a televised feed I could have watched at home.

I'm especially not going to take a vacation day on friday, drive to the city, paying for a hotel room that I have to book months in advance to guarantee a decent palce and end up not getting a ticket for the football game on Saturday because the guy in front of me is holding a spot for 50 people who show up while I sleep. From where I stand, paying ticketmaster a $12.50 robbery fee, $2.50 to print my own ticket (seriously, wtf, they have to update the sales server to recognize a sale, whether they mail it to me or I print it, so why the hell is it more expensive to print it instead of having them cover postage?!?!?), and 6.99 for shipping/handling even though I printed my ticket and I'm the only one handling it, is still better than buying from a scalper (or as you suggest, not getting a ticket at all).

No ticket presales means mostly locals with way, way too much free time get to go to popular events. Maybe I just wanted to spend 2 hours at a concert, not 8 hours in limbo for a 2 hour concert.

Re:Dutch Auction

[TheSync]

How about a dutch auction?

Artists HATE this idea. They are trying to signal to their fans that they believe "in the little guy", thus (in public) they say they like cheap tickets that sell on the primary market below their actual value in the resale market.

Yet artists typically resell the batch of tickets they get for their shows. Plus when their tickets resell for big money, it signals to promoters and venues that they are "sure sell-outs" which helps them put together tours to ensure their ongoing livelihood.

Re:Dutch Auction

[Anonymous Coward]

I doubt that most of the "scalped" tickets are actually sold by scalpers. Most are probably sold by friends and employees of the event and/or venue.

I worked at Ticketmaster, and, no, this is not true. You wouldn't believe the the money & scale at which the secondary ticket market works.

What is the ethical difference?

[wheelema]

Between WiseGuy's and Goldman Sachs? Both use computers to game their respective markets.

Re:What is the ethical difference?

[Anonymous Coward]

Because the products are different and the markets are different, the moral laws that apply are different. For example, we have a social convention that tickets should be rationed on a person basis, but no rationing scheme for shares.

Furthermore, any buyer of shares can buy from any brokerage, so Goldman Sachs will be a price taker, not a price setter. A "share shark" cannot raise the price if nobody else does - in that case, the ill gotten gains would be shared equally amongst all brokerages. You would have to say that share dealers collectively conspire to hold prices high, but this has two problems: firstly, that buyers would switch to other types of investments like bank deposits, secondly that the dealers would have to close shop once they have offloaded their stock, otherwise to be in business they would have to buy back the same stock they just sold.

In conclusion, the stock market works how a ticket market would work if people were free to buy and sell tickets at any price, meaning that the richest gets the most. Because people are bidding for money it means the richest also pays more than others for any given amount of money, which may look nice. You're welcome.

Re:What is the ethical difference?

[Anonymous Coward]

Who cares about ethics when there's profit to be had?

Re:What is the ethical difference?

[Shivetya]

they donate to politicians?

Seems to be the difference between acceptable and not acceptable is how in favor you are with the politicians who write the laws.

Re:What is the ethical difference?

[chaotixx]

One of the two has effectively captured their market regulators.

This is pretty ridiculous...

[chaboud]

It's not illegal to resell tickets above face value in most states (check out stub hub for TicketMaster's very own foray into person-to-person ticket sales), and business can be conducted in alternate states with more lax restrictions on ticket resale.

Beyond that, smoking a CAPTCHA system with a bit of cleverness is not hacking or unauthorized access in any reasonable way. This is just a ridiculous attempt to criminalize scuzzy, crappy, opportunistic behavior on the part of one party (scalpers) at the expense of another scuzzy, crappy, opportunistic party (TicketMaster). This strikes me as another case of people trying to misuse the law to remedy the unexpected (only by idiots) defeat of a faulty system. If one reads the article, it seems like Wiseguys (seriously? That's your name?) made purchases on behalf of ticket brokers (ticket-broker is to scalper as escort is to hooker) with detection-avoiding measures in place to keep TicketMaster from blocking the regulars.

It's an attempt by TicketMaster to wipe the egg off of their face, a face that most of America hates with a passion. Perhaps they should find a better way (reverse auction, anyone?) to find the natural market price instead of using time-release scarcity to spur impulse-buys that inevitably result in person-to-person ticket resale later on stub hub where they get to come back for a second skim off the top...

Oh.. right...

Re:This is pretty ridiculous...

[metacell]

Beyond that, smoking a CAPTCHA system with a bit of cleverness is not hacking or unauthorized access in any reasonable way.

True, but if one of the conditions the seller sets up for selling you a ticket is that you buy it manually, then using a bot to "pretend" you're buying it manually might be considered fraud.

Re:This is pretty ridiculous...

[dontfearmebro]

Agree.

They're basically doing what Ticketmaster and Tickets.com are doing. Get the tickets from the acts and resell them + "Convenience Charge"

Convenience Charge This fee covers costs that allow Ticketmaster to provide the widest range of available tickets while giving you multiple ways to purchase. Tickets are available in many neighborhoods via local ticket outlet locations, our telephone reservation system and Ticketmaster.com. Tickets can be purchased through at least one distribution channel virtually 24 hours a day. The convenience charge varies by event and is determined by negotiations with arena operators, promoters and others, based on costs for each event.

Last 2-3 times I bought tickets from them the Convenience Charge is 80-150% of face value. How is that not scalping?

Re:This is pretty ridiculous...

[t-twisted]

This is just a ridiculous attempt to criminalize scuzzy, crappy, opportunistic behavior on the part of one party (scalpers) at the expense of another scuzzy, crappy, opportunistic party (TicketMaster). This strikes me as another case of people trying to misuse the law to remedy the unexpected (only by idiots) defeat of a faulty system.

This is just your bias preventing you from seeing the argument. If you RTFI (Indictment), you'll see that TicketMaster had clear ToS on their site which specifically prohibited the purchase of tickets on their websites for commercial re-sale. Wiseguys wasn't even selling their tickets to the consumer, but to scalpers to sell for even MORE markup to the consumer.

Their software also jockeyed Wiseguys to the front of the queue, when Ticketmasters was legally obligated to sell on a first-come, first serve basis and spent millions on technology assuring users were queued in that manner. They put forth good faith and effort in creating that technology and yes, efforts to work around it, with or without success, is illegal.

IANAL, and I am no fan of Ticketmaster, but it's pretty striking that you would dismiss a company's right to protect itself in its contracts and reputation just because you do not like with the company. Ticketmaster made the same amount of money it would have regardless of if it sold to private buyers or if Wiseguys bought all of their tickets; however, their contractual agreements with the venues, artists, etc., hold that they sell the tickets with specific conditions, of which they would be violating by turning a blind eye to whom is buying their tickets.

It is also the expectation that all consumers have equal opportunity to buy tickets using their website which is harmed when, despite their best efforts, companies with technological advantages deliberately overcome the considerable amount of defenses Ticketmaster put into place to prevent that sort of behavior.

Disliking the prosecuting company does not make their actions a misuse of law.

Re:This is pretty ridiculous...

[Anonymous Coward]

Last 2-3 times I bought tickets from them the Convenience Charge is 80-150% of face value. How is that not scalping?

It's not scalping because Ticketmaster basically writes scalping laws.

Re:This is pretty ridiculous...

[Anonymous Coward]

If the tickets were sold over the counter it would be perfectly legal (in most places) to buy them with the intent to resell them commercially. TicketMaster might have a corporate policy saying they don't want you to do this, but it's not a law.

This doesn't mean that TicketMaster has no recourse; if there has been a breach of contract, TicketMaster can attempt to resolve it under contract law.

However, as soon as the sale moves online, a breach of corporate policy becomes an unauthorised access, and that is a crime.

In other words, computer misuse laws have elevated corporate policy to the status of criminal law. I don't see how anyone can think that jail sentences in return for breaking arbitrary corporate policies are a good thing.

Re:This is pretty ridiculous...

[chaboud]

Honestly, I don't generally mind Ticketmaster. They serve a fairly useful function, and it's my understanding that the convenience fee can often include promoter fees from which Ticketmaster takes no profit. Promoters would just rather that Ticketmaster absorb the public ill will.

That said, this falls well within the umbrella of principles leading to, say, the first sale doctrine. You should read up on Bobbs-Merrill Co. v. Straus in which the court first established the first sale doctrine. More to the point, check out Northern Pacific R. Co v United States, in which the Supreme Court held that vertical price fixing agreements are per se illegal under the Sherman act. Ticketmaster could have terms-of-service that require that I kill the next person I meet after purchasing a ticket, but that would be an illegal agreement. Contractual restrictions illegal under the Sherman act count. Ticketmaster doesn't get to violate contract law just because they use computers.

More simply, you can't contractually agree to do something illegal, including price fixing. It's why there's an "S" (suggested) in MSRP and an "A" (Advertised) in MAP.

You do not have the legal right to the success of the business model of your choosing, and designing/implementing an easily-gamed system is your fault, not the fault of those who game it. If you ran a three-card monte game with clear plastic cups and then sued me when you realized that you'd lost your shirt, tough nuts.

My only bias is against being stupid...

Security is hard

[Anonymous Coward]

They should have used an HMAC with a unique session token. Security fail.

Also, I don't solve captcha because they are lame. No resource that I could possibly want, would be protected by a captcha.
Fakebook account? Twitter, gmail account? Yeah whatever. Did slashdot add one? I don't know because I'm old here.

It's not one guy!

[spammeister]

I'm sure it was upwards in the many of dozens if not in the hundreds of individuals. This is probably only a problem because they didn't pay any taxes on income earned this way.

Re:It's not one guy!

[metaforest]

I read the indictment. No mention of tax fraud, failure to pay, or evasion. Citation please?

It worked for Waits but it won't for Cyrus

[tepples]

In the United States, state-issued IDs are associated with age-restricted products and services. A minor can't drive, vote, get a job, see an R-rated movie, or buy tobacco, alcohol, lottery tickets, or over-the-counter medication. So a lot of children just don't have a state-issued ID. Requiring every ticket holder to have a valid ID to attend a concert would block such children from attending. That would work for Tom Waits but not for any of several acts that are popular with preteens, such as the Jonas Brothers or Miley Cyrus.

Re:It worked for Waits but it won't for Cyrus

[plastbox]

And that would be a bad thing how exactly? Less brainwashing of our youngsters, and very easy to bag'n'tag the freakoes who attend the latest Disney "pre-teen pop-queen" shows despite not having the kids there as an excuse. ^^

Re:It worked for Waits but it won't for Cyrus

[rjr3]

You would be wrong here tepples. That is EXACTLY what the Miley Cyrus tour did last year. Please call the Sprint Center in Kansas City to see how well it went. Rather than the concert selling out in 15 or 45 minutes as it did the tour prior ... tickets were available for days. Wonder why ? Yep, grandmothers who bought their kids tickets had to show up. And the uncle in Hawaii who bought them for Christmas did too. But the legitimate ticket sellers told people this prior to selling tickets to the uncle in Hawaii. Just like I can't take advantage of really cool sales at Frys in Campbell California, I can't buy tickets for a concert their either. Minors do have school IDs and they are issued by a agent of the Government - a school district. .

Re:It worked for Waits but it won't for Cyrus

[Anonymous Coward]

Do they let minors attend these things without supervision? I feel sorry for Mom or Dad, but it doesn't seem safe letting kids go to a concert alone. So you could check the ID of the parent, and make them vouch for the kids in their care. Unless scalpers are going to escort a bunch of kids to the concerts themselves, I think this'll work.

Re:It worked for Waits but it won't for Cyrus

[Anonymous Coward]

Actually, the Miley Cyrus tour did implement ID-verification, and it didn't work.

Instead of requiring picture ID, the Miley Cyrus tour required the presentation of the credit card used to purchase the tickets.

(For an audience with average age well under the 18 required to have a credit card in the US, this had some negative customer service implications.)

The brokers responded by getting credit card companies to issue them one-time-use credit cards. They used these cards to purchase the tickets and mailed the patrons the credit card with their tickets.

Brokers are clever process hackers and I have yet to encounter an anti-broker scheme that actually works.

Re:It worked for Waits but it won't for Cyrus

[DaleSwanson]

Minors do have school IDs and they are issued by a agent of the Government - a school district. .

Not all schools provide IDs. Many school's ID would be jokingly easy to counterfeit if there was any financial benefit to doing so. Lastly the fact that there are thousands of schools means that it would be impossible to know if a ID even looked like any valid ID.

In the case of an event that is going to be primarily attended by kids you could set up rules to accommodate that. Allow people that are obviously under too young to have an ID to use tickets that have matching last names. I realize some parents have different last names, but this is better than requiring the name to exactly match.

Re:It worked for Waits but it won't for Cyrus

[tepples]

Minors do have school IDs and they are issued by a agent of the Government - a school district.

When I went to school over a decade ago, Fort Wayne Community Schools didn't provide ID until at least high school. I haven't followed what today's children get, but back then, all middle school students got was a "lunch card" with a name and no picture. If you want more info, reply and I might call my aunt who has a kid in elementary school and a kid in middle school and ask whether they have IDs.

Re:It worked for Waits but it won't for Cyrus

[tepples]

Do they let minors attend these things without supervision?

BartholomewBernsteyn's comment appeared to be worded such that it would not be acceptable to put something like "REBECCA BERNSTEYN, minor child of BARTHOLOMEW BERNSTEYN" on the ticket to get Rebecca in on Bartholomew's ID. Perhaps the rules are different for acts on the "pop" charts vs. acts on the "modern rock" charts.

Re:It worked for Waits but it won't for Cyrus

[hitnrunrambler]

Requiring every ticket holder to have a valid ID to attend a concert would block such children from attending. That would work for Tom Waits but not for any of several acts that are popular with preteens, such as the Jonas Brothers or Miley Cyrus.

YA RLY! Think of the children!

Re:It worked for Waits but it won't for Cyrus

[AmonTheMetalhead]

Membership cards and truly random 'human present?' checks would go a long way, they already charge a service fee, so they could include a "free" membership card in those costs, you only need one per customer & a lot of people see more then once concert in their lives

Re:It worked for Waits but it won't for Cyrus

[Anonymous Coward]

bag'n'tag the freakoes

Oooohhhh, DUDE!!! -- you are SOOO in the know!

Where can I buy sufficient coolth so I can sound like you?

Anyway, you can get all you want of that stuff for free just by going to the mall and watching all the little hotties whose criminally-stupid parents let their twelve year olds wiggle around with "BOOTYLICIOUS" sprayed across the ass of their tight little pants.

Yessss -- captcha = superb

Re:It worked for Waits but it won't for Cyrus

[plastbox]

Great, 2 of 2 who didn't get that my post was a joke..

Apparently I need to spell it out to you, so here goes.. My point is that an artist who only gets by because of expert advertising directed at kids shouldn't be allowed to make money. If your product isn't good enough to stand on it's own feet then the problem is yours, not the consumers.

So..

[bunkymag]

.. how much did Ticketmaster make over the period through mark-ups and their ridiculous "handling fees"?

Re:So..

[rjr3]

Do you mean that Ticketmaster, who was able to tell artists and venues that they were able to sell out an event faster than ever before, has no real incentive to stop this activity ? Who cares if the public gets burned ,,, Ticketmaster earned their money in 45 minutes not the normal 2 weeks or a month.

Just ban scalping...

[jonwil]

Anyone who sells a ticket for more than its face value (with a suitable legal definition of "face value") would be hit in a big way. Any tickets they are in possession of would be forfeited back to the event organizer (who could go ahead and resell them)

If the penalty is serious enough (say jail or huge fines) scalpers wont bother.

Event organizers/ticket sellers could limit the number of tickets they will sell to any one person (so scalpers cant come in and buy 50-100 tickets or whatever)

Re:Just ban scalping...

[Therilith]

Let's cut peoples hands off if they are caught stealing too, that'll learn em!

Re:Just ban scalping...

[deniable]

They already limit the number of tickets people can buy in one hit and how exactly do they know if the ticket was resold?

Re:Just ban scalping...

[Anonymous Coward]

Why just tickets? Why not the same rules for anyone who sells a Chinese-built electronics product for more than the two bowls of rice the poor guy at the factory was paid?

We live in a capitalist society, with there is a chain of resellers from the factory to the consumer, raising the prices at every step. That's how it's supposed to work (the other way, with fixed prices is usually called communism or socialism). That's the way it works for electronics, for cars, for food...

Are tickets more important than even food, since we seem to not just be willing to accept that they get sold at a fixed price, but actually consider it wrong (legally or morally) to treat them the exact same way?

Re:Just ban scalping...

[AmonTheMetalhead]

They already limit the amount of tickets per person, fat load of good that'll do you when an organized scalper comes along with thousand different id's & computers, they'll still swamp the queue preventing the real customer from getting a ticket.

Re:Just ban scalping...

[AmonTheMetalhead]

Print the owners name on the frecking ticket.

Re:Just ban scalping...

[Anonymous Coward]

If the penalty is serious enough (say jail or huge fines) scalpers wont bother.

The reak cocksuckers who should be in jail are the bastards who sell the tickets in the first place.

I once read the back of a ticket for a show "sponsored by the San Francisco Chronicle" at the concert venue in Concord, California.

Surprise -- EACH FUCKING INDIVIDUAL TICKET included a few bucks of parking fee for the FREE PARKING. And they still had kids in the lot selling VIP parking for an additional $10.

Understand what's going on here -- EACH ATTENDEE has prepaid a parking fee on EACH ticket. The parking is advertised as "free" because you don't pay at the gate. So, you pay for parking if you drive your cqr in. If you save the promoter space by bringing four other people in your car, you pay the son of a bitch FIVE parking fees. If you WALK in, as I saw many (probably local) kids doing, EACH ONE has paid a parking fee for leaving tjheir cars parked AT HOME in their own driveways.

Now you know the real guys who should have their nuts crushed -- slowly.

If I ever again get stuck going to such an event (not likely), I WILL RESIST all attempts at car-pooling and take my own vehicle and park it in MY FUCKING PAID-FOR INDIVIDUAL PARKING SPACE. It's MY fucking carbon and I'll spend it as I see fit.

Re:Just ban scalping...

[Leebert]

Print the owners name on the frecking ticket.

Stupid idea. You know how many times I've gotten tickets to a football game because someone else couldn't use their tickets? I've been on both ends of that, and it's great to be able to pass on tickets to someone and brighten their day.

Screw that. The venue has its money, it's irrelevant who is sitting in the seat or how much they paid for the ticket.

Re:Just ban scalping...

[AmonTheMetalhead]

Stupid idea? It's already being done in different venue's, and to great success.

I do agree they need to offer a means to get rid of unwanted tickets though

Are you telling me...

[cvtan]

that Stubhub is owned by Ticketmaster? I can't believe this. The last two times I tried to get into concerts at the Rochester Auditorium Theater and the War Memorial (Blue Cross Arena), it was difficult. Somehow all the good seats vanished almost immediately. But no, there are seats that magically appear on Stubhub. All you have to do is pay $300 for a $75 seat. Infuriated, I refused (obviously, I've been out of the loop for a while). So for one concert I bought tickets from someone on eBay (double the face value!) and for the other I just got cheap tickets in a poor location. Apparently this kind of poor service has no effect since the venues are sold out anyway. This makes me not want to go to events like this and just buy the DVD! Maybe you have to be a teenager to put up with this BS. I still have the antiquated belief that ticket resellers should not make more money than the artists or promoters. You don't see Wallstreet brokers doing this. Oh, wait...

Re:Are you telling me...

[cvtan]

According to this article: http://mashable.com/2007/04/19/ticketmaster-sues-ebay/ , eBay owns StubHub and was sued by Ticketmaster. Now I'm really confused.

Re:Are you telling me...

[Anonymous Coward]

Stop the presses: some thing you want to buy costs more than you want to pay. Boo hoo.

Re:Are you telling me...

[Kurt Granroth]

Stubhub is owned by eBay, not Ticketmaster. Ticketmaster owns TicketsNow.

So how do tickets "magically" appear on Stubhub, eBay, or TicketsNow before you can buy them retail? Well, there are several ways.

First, some of the tickets for sale on the reseller sites don't yet exist. The sellers are gambling that they will get the tickets before you need them. This practice may soon be illegal (and I think already is in New Jersey).

The most common way, though, is via "presales". See, tickets don't go on sale all at the same time. The promoter, concert venue, and artist (and more) all get a certain number of tickets that they can sell before the official onsale date. A common use for these are fanclub tickets. That is, if you are part of the U2 fan club, then you are given the option of buying a certain number of tickets at (usually) a reduced price and before anybody else can buy them. American Express often has some deals like this as well. The end result is that a lot of the very best tickets are sold well before the tickets look like they are on sale at all. Well, every ticket scalper is part of every fan club and do whatever it takes to be part of a "presale". They then take their tickets to your favorite resale spot and voila, the ticket magically appears there before you could have bought it direct.

Re:Are you telling me...

[jandrese]

I've always suspected that most of the bigger scalpers are in league with Ticketmaster. Heck, the ones in this article might have been hit just because they didn't pay Ticketmaster the proper kickbacks on their scalping operation. It just didn't seem feasable to me that someone stuck going through the same slow overloaded crappy interface as everybody else would be able to snap up all of the good tickets within milliseconds of them going on sale (who am I kidding, they were all gone well before ticket sales opened up) otherwise.

Re:Are you telling me...

[inviolet]

that Stubhub is owned by Ticketmaster? I can't believe this. The last two times I tried to get into concerts at the Rochester Auditorium Theater and the War Memorial (Blue Cross Arena), it was difficult. Somehow all the good seats vanished almost immediately. But no, there are seats that magically appear on Stubhub. All you have to do is pay $300 for a $75 seat. Infuriated, I refused (obviously, I've been out of the loop for a while). So for one concert I bought tickets from someone on eBay (double the face value!) and for the other I just got cheap tickets in a poor location. Apparently this kind of poor service has no effect since the venues are sold out anyway.

Wow do you ever need a semester of Micro 101. The "face value" of a ticket is just noise -- it has little bearing on the actual value of a ticket. The actual value can only be determined by a market that is allowed to clear.

Since the auditorium is full despite the 300+% markups, the face value must be incorrect. And now you are bent out of shape because the incorrect face value set your expectations erroneously low.

Ticketmaster uses artificially low face values in order to give the scalpers, who are its risk-mitigation division, some wiggle room. Scalpers could not perform their service if they had to buy the tickets (and hence risk getting stuck with excess inventory) at their full real value.

Re:Are you telling me...

[Anonymous Coward]

This is damned funny! I love this $h*t. Big-name (according to the label) 'artists' get bussed into your town and of course, being the uninformed dork you are, you queue up for whatever they're serving. Why are you shocked (SHOCKED!) that someone would be making big money off the tickets you complain about not getting?
Law and demand, my brother. Invisible hand of the market and all that $h*t. Welcome to the new economy, same as the old economy.

Why don't you apply this simple filter to your future concert-going plans:

sub dont_go {
    if ($artist == 'LOCAL_BAND' && $venue == 'SOME_BAR')
        {print ("Get out of the basement!");}
    else
        {print ("Rent a movie!");}
}

if ($artist == 'BIG_NAME' && $venue == 'BIG_PLACE')
    { &dont_go;}
end

See? Works like a charm.

Re:Are you telling me...

[ari_j]

I'm just surprised that they aren't sending DMCA take-down notices to eBay to further interfere with the competitive market for tickets. Many companies do that to destroy the secondary market for their products, including DVDs (legal to sell under first-sale doctrine) and toys, based on my personal experience and second-hand accounts plus a lawsuit that a guy brought against Autodesk for doing it enough that his eBay account was suspended, even though he filed counter notices and had every auction reinstated by eBay.

Re:Are you telling me...

[Anonymous Coward]

It's pretty easy, botnets simply crawl over the sites before the sale starts, as soon as the booth opens they already have active sessions and end up in the queue before anyone else can get in there, from that point on it only depends on how good their bots are & how many accounts they have access to

Re:Are you telling me...

[TheSync]

Stubhub is owned by Ticketmaster?

No, Stubhub is NOT owned by Ticketmaster, it is owned by eBay. Reseller TicketsNow is owned by Ticketmaster.

Buying the tickets was not the problem

[houghi]

From the article

The perpetrators took orders from ticket brokers, who were required to provide credit card numbers and account holder names in advance of a purchase so they could be programmed into the bot. Once the account holders received the tickets, they'd send them to Wiseguy, which would refund their credit card account. Wiseguy also had a bank of about 1,000 phone numbers that the bot submitted as customer contact numbers.

So the tickets were payed. That is not the issue. Wether reselling should be allowed or not is another matter. What I am worried about is that they abused the credit card numbers of other people.

Point missed by a mile.

[Anonymous Coward]

I can afford to pay $500 for two tickets to a concert, but I want the best possible. If I wait for the best tickets to drop in price, they may sell out before they reach the pricelevel I'm willing to pay, so I need to buy the second best tickets, but these sold out at $100 even earlier.

Missed the point.

If you want the $500 tickets, you cough it up right then and there or you lose - too bad. Don't want to pay the price but others are? Tough shit. You lose.

Change your mind and go for the cheaper seats that were going for $100 and they're gone? Too bad. Because you want to wait doesn't mean you're entitled to get the tickets cheaper - even though others are willing to pay the price to get them immediately.

Bigger scum than TicketMaster in same business!

[Kaz Kylheku]

Wow ,,,,

why is this in any way illigal this is usa

[Anonymous Coward]

when did automated trading of goods become outlawed in the united states

$25 million gaming dollars

[bryan1945]

Is this like the South Park episode where Butters earned $300 million theoretical Internet dollars?

In other news...

[Errol backfiring]

Big corporations put their computers physically close to the stock exchange to have that nanosecond advantage for their automatic buying / selling machines. But that is obviously OK.

Re:In other news...

[footNipple]

Big corporations put their computers physically close to the stock exchange to have that nanosecond advantage for their automatic buying / selling machines. But that is obviously OK.

And we pay dearly for this proximity
http://en.wikipedia.org/wiki/New_York_Stock_Exchange
"The right to directly trade shares on the exchange is conferred upon owners of the 1366 "seats". The term comes from the fact that up until the 1870s NYSE members sat in chairs to trade. In 1868, the number of seats was fixed at 533, and this number was increased several times over the years. In 1953, the exchange stopped at 1366 seats. These seats are a sought-after commodity as they confer the ability to directly trade stock on the NYSE. Seat prices have varied widely over the years, generally falling during recessions and rising during economic expansions. The most expensive inflation-adjusted seat was sold in 1929 for $625,000, which, today, would be over six million dollars. In recent times, seats have sold for as high as $4 million in the late 1990s and $1 million in 2001. In 2005, seat prices shot up to $3.25 million as the exchange was set to merge with Archipelago and become a for-profit, publicly traded company. Seat owners received $500,000 cash per seat and 77,000 shares of the newly formed corporation. The NYSE now sells one-year licenses to trade directly on the exchange."

So, umm, the difference is...?

[Moraelin]

Sure, if you've no moral qualms about what you're doing.

So, when we're talking about people already doing stuff that's immoral and often illegal, if the only barrier the captcha offers is "Sure, if you've no moral qualms about what you're doing"... then it seems to me like the most useless gimmick ever. Does anyone actually think that the kind of people we needed captchas against would go, "man, I only wanted to cheat, scam and pollute with email and link spam, but OMG breaking a captcha would be just morally _wrong_. I just can't do _that_."?

Plus, that was not the argument made back then for this crap. Everyone was ranting about how it's such a great defense. If you just tried to point out the ways it can be circumvented, everyone would treat you like you're some kind of a crazy conspiracy theorist.

Well, now it's been officially done, and it's been done for almost a decade, judging by how long these guys operated. Now what?

I'm not saying this as schadenfreude, but I find it genuinely sad that for so long millions of users have been outright excluded from some services, in the name of a solution which just simply doesn't work.

Some captchas are getting so obnoxious, that even I have trouble with some two times out of three, and God help you if you have eyesight problems. And most audio versions I never could decode in the first place. I guess the garbled, low signal to noise thing might not be that bad if you're a native English speaker, but God help you if you aren't.

And for what? For a stupid solution that only works if you have a moral problem with breaking it?

Re:So, umm, the difference is...?

[Anonymous Coward]

The current implementations of both visual and auditory Captchas are immoral.

No the problem here is that captchas discriminates against people unnecessarily.

Captcha is broken: http://churchturing.org/captcha-dist/

Re:So, umm, the difference is...?

[misexistentialist]

For a stupid solution that only works if you have a moral problem with breaking it?

It wasn't just lack of morality that let these guys break the captcha, but an investment of time and money. I agree that there should be a better solution, but I don't think you can dispute that captchas make using web-pages more difficult for everyone, including hustlers.

Re:So, umm, the difference is...?

[metaforest]

The above comments reminds me of an old saying:

Locks don't keep criminals out. They keep honest people honest.

there's a small town in the mountains

[circletimessquare]

every sunday a guy shows up with 20 bags of flour. the townspeople line up and buy the flour from the guy, $2/ a bag

one sunday, this asshole shows up really early, buys all 20 bags for $40, turns around and faces the townsfolk and says "ok, that will be $5 a bag from each of you"

understand the illegality yet?

incidentally, this puts the lie to libertarians and free market fundamentalists who believe the market is healthiest when left alone. a healthy market needs to be heavily policed by the government to be healthy, solid fact. because of exactly this sort of market manipulation, of which there are thousand such slimy schemes. there will always be assholes who find natural market imperfections and insert themselves as artificial middle men and gouge the marketplace. they add no value. they parasitically insert themselves in the marketplace and suck it dry

anyone can appreciate how they hurt our economy and hurt the marketplace and the free flow of goods. its a form of robbery what they do, but its diffuse, not specific, and so some people like you can't appreciate their evil up front. i hope you appreciate it now

Re:there's a small town in the mountains

[somersault]

understand the illegality yet?

Nope.. if the townspeople simply refuse to buy the flour at that price (either doing without flour for the week or buying from a different location), the asshole is down $40. If people know that most of what they're paying is pure profit and yet still pay the price, they're simply idiots. This is exactly how a free market is supposed to work.

Re:there's a small town in the mountains

[TheKidWho]

Perfectly, if people are willing to pay $5/bag for it. If they're not, then the guy will have 19 useless bags of flour. What will most likely happen is someone else will come in and offer cheaper flour, it's the nature of the market since such a high price will create a deadweight loss. Free market at work.

At the end of the day, isn't that what the supermarket does anyways? They buy flour for $x and then they resell it for $x+$y. What keeps them in check? Competition from other supermarkets.

Re:there's a small town in the mountains

[Hognoxious]

one sunday, this asshole shows up really early, buys all 20 bags for $40, turns around and faces the townsfolk and says "ok, that will be $5 a bag from each of you"

understand the illegality yet?

No, because that's not illegal, at least in any place I've ever lived.

Re:there's a small town in the mountains

[thedonger]

incidentally, this puts the lie to libertarians and free market fundamentalists who believe the market is healthiest when left alone.

Om my god, you are right! People need to be protected by the government. No one should be forced into a position where they must make their own decisions, because life just isn't fair if everyone doesn't succeed.

One thing bothers me about that: invariably, those who oversee us "little people" will wind up living a much more prosperous life as we continually and increasingly rely on them to police that which might harm us. Their position of power will ultimately be threatened by us gaining knowledge, history will be re-written to their liking, books will be burned, their excess will spiral out of control, and...Viva la revolution!

Makes you wonder how Orwell, Bradbury, and Huxley got their ideas...

Re:there's a small town in the mountains

[Herkum01]

Yeah,but we are talking about sporting events and rock concerts. Hardly necessities in our current lives.

Re:there's a small town in the mountains

[hitnrunrambler]

every sunday a guy shows up with 20 bags of flour. the townspeople line up and buy the flour from the guy, $2/ a bag

one sunday, this asshole shows up really early, buys all 20 bags for $40, turns around and faces the townsfolk and says "ok, that will be $5 a bag from each of you"

understand the illegality yet?

Ummm..... NO.

That is not illegal. Greedy? yes. Unethical? yes. Parasitic? yes. But not illegal, it's not even a monopoly; and as many people are going to observe it is "the American dream" to buy something, do nothing, and double your investment.

What (in theory) is illegal here are potential allegations of impersonation, wire fraud, and unauthorized access.

Now if you have an idea of how to remove parasites from the market place then I'm all ears, but pretending that capitalism is illegal is not the same as fixing capitalism.

p.s. by "fixing capitalism" I mean either: "Making it work for the good of all" or "Cutting it's balls off so it stops breeding".

Re:there's a small town in the mountains

[rockypg]

The townspeople can only refuse to buy as long as there are alternative sellers for flour. If the asshole starts buying from several sources, over time, he becomes a popular seller and if there isn't competition, the only known seller. All producers will be forced to sell to him, because he's the only access to the market now.

How does free market correct for these parasitic middlemen?

How does free market kill **AA?

Re:there's a small town in the mountains

[Aquitaine]

>> understand the illegality yet?

No.

>> , and so some people like you can't appreciate their evil up front.

Good thing we have you around to protect us from ourselves!

This is mickey mouse Econ 101 stuff. The only way your scenario ends in 'people starve' is if there is only one supplier of flour (i.e. flour is controlled by a monopoly). Even libertarians (many of us, anyway) agree that monopolies have to be treated a little differently, at least in cases where the nebulous 'public good' is involved -- typically infrastructure or telecom where you have private companies gaining access to both public and private land and need some oversight.

This is certainly not the case with your flour example, though let's give you a pass on the analogy since someone else can make more-or-less identical flour, which is tough to do with a Springsteen concert.

There are a variety of methods for ticket sellers to combat scalping, and a variety of reasons (which vary by state and country) which often restrict a vendor from selling the same product at two different prices based on the buyer. For example, ticketmaster can charge me $100 for an orchestra seat and $60 for a balcony seat, but (AFIAK) they can't charge me $100 for an orchestra seat but then make my buddy pay $140 for another orchestra seat at the same time; they can raise all their prices or have 'early bird discounts' but those things affect all transactions. They can only sub-divide on a limited scale, e.g. 'American express discount' or other things which apply to fairly large groups but not individuals. So you have a certain degree of rigidity that is being forced on the market, since there are clearly some people who would pay $200 for an orchestra seat, but pricing all their orchestra seats at $200 would never fly -- so they sell them to scalpers who can turn around and sell them at whatever price they want through a variety of outlets. Those prices can change every day (we'd never put up with Ticketmaster doing that) because there are effectively multiple small markets as opposed to a single larger one.

As for whether or not all this should be legal, the practical reality is that it's very tough to eradicate when you have a static, tiered market that actually wants to behave like a funnel. You'd pretty much have to mandate that tickets be linked to the actual person attending at the time of purchase, which means no resales, no gifts, no last-minute 'oh crap i can't go who wants to buy my ticket?' A simple, free-market solution would be to give somebody a 'lock-in' ticket price in which they could voluntarily tie the ticket to themselves (non-transferable) and get a lower price - that would cut into the scalping market quite a lot. I'd guess that it isn't legal to do as the ability to re-sell something that you've bought is usually quite well protected, but that's a question for the law and not a free market criticism.

Re:there's a small town in the mountains

[AmonTheMetalhead]

The analogy isn't completely correct, basically the scalpers (the ones in TFA) are so organized that they basically prevent other customers from purchasing any tickets at all, because they swamp the servers with thousands of connections at once as soon as the booth opens, if you don't happen to be a split second faster then their botnets you might not get a ticket at normal price, now, i don't know about you, but my home internet connection has a lot more latency then my server in a datacenter, beating a whole botnet is unlikely, you just have to hope there are still some tickets left when their botnet stops buying them.

Re:there's a small town in the mountains

[chudnall]

Why didn't the original guy sell the flour at $5/bag? Does he like leaving money on the table? Or was competition keeping his price low? or were the townspeople unwilling to pay that much? In the latter two cases the "asshole" won't profit from his gambit, and in the first one, well, he's taking advantage of the seller's poor business practices.

Re:there's a small town in the mountains

[Nukenbar]

If the townsfolk would by the bags at $5 / bag, why wasn't guy #1 selling them for that much?

Re:there's a small town in the mountains

[somersault]

It corrects because if the price is too high, people can't buy and the seller goes out of business. If people can still buy then they are obviously willing to pay. Also if the guy really is killing people through his actions, then chances are that a lot of people will want to kill him, and everything will balance out. The free market could kill the **AA by refusing to buy their products, or by labels and artists refusing to sign up. But guess what - that's not going to happen anytime soon.

Re:there's a small town in the mountains

[Duradin]

Perhaps he doesn't need to charge more than $2/bag. The $2/bag could be profitable enough for him.

Oh yes, "enough", a lot of you probably won't understand that term as it isn't "all or nothing".

Re:there's a small town in the mountains

[somersault]

I understand the problem perfectly well, I just don't think it is (or even should be) illegal. The end prices will always reflect what people actually are willing to pay. I do sympathise with the customers in this case, but AFAIK there is no law against buying stuff and selling it on at a higher price, even when the supply is very limited.

Re:there's a small town in the mountains

[chdig]

Ah, and in our example at hand, the only free market is coming from the scalpers. Ticketmaster and like companies are usually monopolies over venues, not allowing for competitors to also sell tickets, nor the artists to have any say over how tickets to their shows are sold.

They use their monopolistic positions to charge exorbitant fees, that drive prices to see arts events through the roof. If venues would focus on local sales through multiple distributors online and off, they wouldn't have this problem that is of their own creation.

Re:there's a small town in the mountains

[Anonymous Coward]

Bullshit. There is no free market when the opening price is snatched up by scalpers. This is certainly not how it is "supposed" to work. What you are saying is it's OK if only the elite can afford to go to these concerts. What I am saying is "FUCK YOU"!

Re:there's a small town in the mountains

[Anonymous Coward]

I love when people say "Come on you idiots! Don't you know how the free market is supposed to work?" And yet this scheme is proof positive that it simply doesn't. At least not without a little sane regulation. A libertarian believes that the market is intrinsically fair because everyone in it will make rational decisions. If the price of flour is artificially too high, the libertarian claims, people will just go without the it (despite having the means to pay for it at it's inflated price) and the problem will solve itself. But that is NEVER the case! Humans are NOT purely rational agents. Fucking deal with it. And they are especially irrational when it comes to the potential for seeing their favorite musician or their favorite sports team play. I'm happy there are (sane) rules and regulations on the free market that make this illegal. I'm sure most people agree with me.

Stalwart libertarians need to get their head out of the clouds. Your free market utopia is never going to come.

Re:there's a small town in the mountains

[AmonTheMetalhead]

So you pretty much have no problems with organized crime preventing people to buy items legally by means of bullying/blocking access? because that's basically what happens.

Ticket sale system goes life, within a microsecond a botnet swamps the servers with thousands of connections filling up the queues pushing the individual customer way back to the queue or even unable to connect to the servers, see where the problem is?

Re:there's a small town in the mountains

[badran]

He does add value.

1. The original seller, finishes his job earlier.
2. The risk is moved from the producers to the sellers (look at futures).

As others said, It is not like others are not allowed do run a similar business. Just get some flour from another source, and sell it at $4/bag. This is a free market model.

Re:there's a small town in the mountains

[geekoid]

"understand the illegality yet?"

No. He is doing the EXACT same thing the other guy is doing. Acquiring the flour and then selling it at a profit. If he doesn't like it, then he can sell a limited amount to each person, or refuse to sell anything to that person.

Nice attempt at using a debate trick to get an emotion appeal.

Here is a clue for you:

NO ONE STARVES IF THEY DON'T GO TO A CONCERT.

Since food is a matter of life or death, there are regulations for it. Hence, it's a different discussion. THIS discussion is about people buying up a limited supply of an entertainment item.

Now I ask you:
Scalping is philosophically incoherent in a free market, why shouldn't those laws be ignored?

Re:there's a small town in the mountains

[pscottdv]

every sunday a guy shows up with 20 bags of flour. the townspeople line up and buy the flour from the guy, $2/ a bag

one sunday, this asshole shows up really early, buys all 20 bags for $40, turns around and faces the townsfolk and says "ok, that will be $5 a bag from each of you"

understand the illegality yet?

Except it's more like the original guy shows up with $2 toy dolls rather than bags of flour. Now why is it illegal?

Re:there's a small town in the mountains

[somersault]

If it's criminal then yes I have a problem with it, but if there are no laws against it then all these guys are doing is taking advantage of a poor system to make some money.

I do also have a problem with it ethically, but that is not the point. I don't think it should be actually illegal. There is no point in you repeating over and over what they actually did, I understood that part fine from the summary. The original distributor of the tickets needs to do something more than just put up a TOS asking people not to buy more than two tickets - they need to actually limit how many times a credit card can be used per concert, or limit IPs to only being allowed to buy one ticket every 30 seconds etc. That would slow things down a lot and force these guys to actually require some kind of criminal activity to be able to get around the ticketing requirements, and then you have something you can nail them with. They probably already were using illegal botnets though, and I definitely do have a problem with that.

Re:there's a small town in the mountains

[Anonymous Coward]

The only way this is negative is that you are describing a monopoly situation. If the people have no other choice, and there is other source of the good, then the seller has a monopoly. A local monopoly is why when you go to the movies or a ball game soda pop and popcorn costs $4 while you can buy it in a store outside for $1.

By using automated means of purchasing, and excluding regular purchasers, the scalpers create a monopoly (one seller of the tickets) and then extract the difference in value from the maximum value that people will sell and the price that the original website sold them at. By auctioning blocks of tickets, with an auction spanning a week, the original ticket seller could destroy the margins that the Scalpers get and hence scalping.

Re:there's a small town in the mountains

[Archangel Michael]

You miss the point. If the first guy was selling flour at the MARKET price, there would be no scalper. Scalpers only make money when prices are artificially low, demand is high, and quantity is limited.

This is econ 101, basic supply/demand curve stuff, and the concept of maximizing profits. I realize that most illiterate dropouts and dope smokers don't have this basic concept down because they base their economics on things like "fairness" and "moral outrage".

If you don't like market pricing, I have a suggestion for you. How about I tell you how much you are worth and you can't earn any more than that. Who's sense of "fairness" do you want to employ, mine or yours? If it was up to me, and my moral outrage, we wouldn't be paying anyone in the Federal Government more than $25,000 year (including the president, congress and all federal employees). It isn't fair.

Re:there's a small town in the mountains

[pla]

understand the illegality yet?

One problem with your analogy...

In this case, Ticketmaster counts as the asshole buying all the flour and selling it at a markup - And by explicit collusion with the original seller, no less, an arrangement that in most contexts would count as illegal.

Wiseguy simply found a way to trick the asshole into selling them a significant portion of the flour at $5, so they could then resell it for $6.

Personally, I fall on the "what crime?" side of this story, for one reason (unrelated to the BS about the captchas and the legally paid for botnet) - Ticketmaster just won their own ticket diversion case where they basically did the exact same thing as Wiseguy, except by selling to themselves, they didn't need to worry about silly little risks like competing with the public for prime tickets, they could just reserve them before sales even started.

That said, all of these clowns need 255 grains of lead administered transcranially. It amazes me that more of the actual performers don't take a stand (they don't get more money my the tickets passing through 27 middlemen, each tacking on their own fees) and say "if you do this, we won't play".

Re:there's a small town in the mountains

[Anonymous Coward]

incidentally, this puts the lie to libertarians and free market fundamentalists who believe the market is healthiest when left alone. a healthy market needs to be heavily policed by the government to be healthy, solid fact.

O Rly? Then why is it expressed as an opinion? Surely you must be able to produce the facts that support your opinion^H^H^H^H^H^H^Hstatement, right?

Don't worry, I'm not expecting a reply so, I'll spare you the embarrassment of not being able to come up with one.

Re:there's a small town in the mountains

[LWATCDR]

Not really.
Okay so the other framer down the road hears about this and comes and sells his flour for $2.50 and puts the shuck out of business.
But scalpers are very different than the case you describe.

He is not selling flour or beans. He is selling candy.
Nobody has to go to a concert or sporting event. This is a 100% luxuary item. Simple solution is don't buy from scalpers.

Re:there's a small town in the mountains

[Anonymous Coward]

understand the illegality yet?

Nope..

It's quite obvious, the guy who buys all 20 bags for $40 also knows the mayor, that is why it is illegal.

Re:there's a small town in the mountains

[eth1]

Flour is a bad example... everyone's situations are assuming some infinite source of flour that other people can tap to get into the market. Scalpers basically buy ALL available tickets, creating a monopoly. (You can't just go get more tickets and sell them cheaper) Last I checked, using a monopoly position in a harmful manner was illegal.

Re:there's a small town in the mountains

[AmonTheMetalhead]

They were being charged with conspiracy, fraud & illegal access to computer systems, see page 14 & 15 of the indictment. That does seem like criminal behaviour to me...

I have no problems with one individual reselling his ticket for profit, sure, i might think he's a dick, but hey, it's his right to do so, however, when people start using whole networks to do this in bulk, then it does become a problem.

Re:there's a small town in the mountains

[Cytotoxic]

The only monopoly in the ticket game is Ticketmasters. The scalper may try to corner the market on a given event, which is a very advantageous position in any market, but the ticket buying consumer is not slave to the event - he can buy other entertainment elsewhere. Maybe not as good (to him), but not a monopoly. Good luck buying tickets to a live event without Ticketmasters getting a cut though.

Love/hate relationship

[pongo000]

Ticket scalpers and domain squatters: Love 'em or hate 'em!

Sometimes I believe /.ers are pissed at these types because they didn't think of the idea first.

It's a free market (after all, don't markets want to be free?)...I say kudos to them for figuring out how to scam the scam.

Random ID

[Yowz882]

..downloaded hundreds of thousands of possible CAPTCHA challenges from reCAPTCHA. They identified the file ID of each CAPTCHA challenge and created a database of CAPTCHA "answers" to correspond to each ID. The bot would then identify the file ID of a challenge at Ticketmaster and feed back the corresponding answer."

This was an easy one. Why didn't the developers implement a random ID for each captcha created? For example, if my CAPTCHA system produced "Ableoo", I would put this in a temporary table with a random unique ID. In fact, to make it more secure, I would put a time stamp on it so that it's only active for 1 minute! The next time it produces the same Captcha, it will use a different ID.

Re:Random ID

[AmonTheMetalhead]

Next time it generates ableoo through the same algorithm, the file generated might just be identical to the other one....

Re:Random ID

[Yowz882]

If you're talking about the actual file (not file name, which should be random as well), you are correct. I guess they should also sprinkle it with extra dots or colors to make it even more unique. :-D

Re:Random ID

[metaforest]

You are forgetting that one could cache an MD5 hash of the image and have a pretty good chance of identifying that image regardless of it's image URL or request information, simply based on it's content. Apparently ReCAPTCHA was flawed in a number of different ways, and WiseGuys and others have apparently learned to exploit that weakness through straight-forward data-mining, and strategic IP and code theft.

they STARVE genius if they don't buy the flour

[circletimessquare]

seriously, my example above is not some hypothetical. its going on right now in a thousand markets around the world, always has been, and always will. it adds no value to the economy, its a form of parasitism. you do understand that it is a form of robbery, right? please tell me your neurons can fire on that obvious concept

Re:they STARVE genius if they don't buy the flour

[somersault]

It's not a form of robbery, it's what happens in a free market, and if people don't buy the food (seriously, you think they'll starve after a week? I don't know how long flour lasts though). Unless it's happening all over the board then they can get other forms of food. If they all die then the scalpers would lose all their customers anyway, so they'll bring their prices down until most people can actually afford it. Yes, some people will still not be able to afford it, but that's how these things work in non socialist countries. Otherwise by your reasoning anyone that ever makes a profit is simply a robber and a parasite. In this case the scalper doesn't really add any value, but what he is doing is not illegal, and the townsfolk can also go to a different source, unless they guy has some kind of monopoly (which is in fact illegal).

Re:they STARVE genius if they don't buy the flour

[TheKidWho]

If there isn't any other competition in those markets then it simply means that those goods are scarce goods in that region and a higher price is deserved.

Re:they STARVE genius if they don't buy the flour

[osgeek]

Yeah, "assholes" buy up tons of product every day and resell them for more money. They're called super markets.

If you've ever lived in a country/area where socialistic price fixing is the norm and capitalism can never get enough of a hold to make it economical for resellers to streamline the purchase and distribution of food, you might have a second thought about who lacks active neurons in this conversation.

Re:they STARVE genius if they don't buy the flour

[Anonymous Coward]

I believe what you are describing is cornering the market. http://en.wikipedia.org/wiki/Cornering_the_market It's legal, and barely ever works. The guy bringing flour up into the town is going to start bringing more and more flour into the town because it is selling out so quickly. The man trying to corner the market will need to keep buying all the seller's flour to keep the market cornered. Eventually he'll run out of money and the townspeople will once again be able to buy $2 flour from the seller.

Then the guy trying to corner the market is screwed because he has 3000 bags of flour when the going rate is still $2.

Many people have tried, it almost never works and whoever tried it loses a large majority of their money in the resulting price crash. Just think of the Dukes and their frozen orange juice!

Re:they STARVE genius if they don't buy the flour

[MooseMuffin]

"Everything is worth what its purchaser will pay for it."

Re:they STARVE genius if they don't buy the flour

[Duradin]

This is Rand Land. You're not going to get much support here.

In Rand Land profit is the Prophet and the Prophet says greed is the only good.

Re:they STARVE genius if they don't buy the flour

[TheKidWho]

Is profit greed?

Re:they STARVE genius if they don't buy the flour

[badran]

Just any one who grew up in the CCCP/USSR....

Re:they STARVE genius if they don't buy the flour

[Duradin]

Excessive profit is.

Re:they STARVE genius if they don't buy the flour

[TheKidWho]

What is excessive?

Re:they STARVE genius if they don't buy the flour

[Kabuthunk]

And THERE it is... you had a good argument going, and then you completely destroyed it and made everything you said worthless in a few short words:

unless they guy has some kind of monopoly (which is in fact illegal).

Ticket botnet buys up all available tickets. Tickets cannot be purchased elsewhere. Monopoly.

Re:they STARVE genius if they don't buy the flour

[Cytotoxic]

You sound like you are interested in the topic, so I'll offer this resource:

The Market Maker is a great documentary about an academic who was working on poverty in Africa and decided to do something about it. Dr. Eleni Gabre-Madhin found that famine in her native Ethiopia was not due to a lack of supply of food, but to a problem with distribution. So she created a commodities market. And the results are stunning. She's helping to eradicate hunger, increasing the wealth of farmers and elevating the entire society.

All while making a profit.

As a middle man.

Watch the documentary and see if you still can't understand why a middle man can add value.

Re:they STARVE genius if they don't buy the flour

[TheSync]

Dr. Eleni Gabre-Madhin found that famine in her native Ethiopia was not due to a lack of supply of food, but to a problem with distribution.

How about the fact that most farmers in Ethiopia cannot own their land, they must lease it from the government, making it impossible to get a loan for supplies.

You know what else is wrong with Ethiopia:

Relatively rigid labor regulations hinder employment and productivity growth. Firing unneeded or poorly performing employees is difficult. Restrictions on work hours are inflexible.

Corruption is perceived as pervasive. Ethiopia ranks 126th out of 179 countries in Transparency International's Corruption Perceptions Index for 2008.

The government strongly influences lending and owns the largest bank, which dominates the banking sector.

Foreign participation is prohibited in domestic banking, insurance and microcredit services, and several other activities. All investments must be approved and certified and may be subject to additional restrictions. The judicial system remains poorly staffed and inexperienced. Foreign exchange accounts, payments, and current transfers are subject to tight controls and restrictions.

Inflation has skyrocketed, averaging 21.8 percent between 2006 and 2008.

Ethiopia's weighted average tariff rate was 11.5 percent in 2008. Import taxes, import restrictions, restrictive foreign exchange controls, services market barriers, non-transparent government procurement, import licensing, cumbersome customs clearance, and inadequate infrastructure add to the cost of trade. All imports must be channeled through Ethiopian nationals registered as official import or distribution agents with the Ministry of Trade and Industry.

The overall freedom to conduct a business remains constrained by Ethiopia's regulatory environment.

Re:they STARVE genius if they don't buy the flour

[thickdiick]

Profit is a sign that a market is inefficient. All free markets are continually moving to a point where there is no profit. I, for one, like the fact that i don't live in a "Soviet Russia" where there are shortages. In a nice country, there are no shortages, and i find it pleasant that i know that there is always a ticket i can buy. The marginal utility of said ticket is higher for me than the others who think it's stupid to buy the ticket for that price. What can i do? Nothing needs to be done.

Sounds familiar.

[Civil_Disobedient]

Sounds like health insurance.

Easy solution...

[WoollyMittens]

Why aren't tickets sold to name? It'd solve all this stupid scalping stuff.

"Bots" were their own, not bot farm

[michaelmalak]

Although the indictment makes heavy use of the word "bot", Wiseguys did not use viruses or trojans to create their bot farm. They paid for it themselves, with their own computers, purchasing varied IP addresses from varied ISPs across the U.S. to prevent Ticketmaster's et al IP address blocking.

In the old days, ticket wholesalers would hire hobos to stand in physical line. In the Internet era, is it now necessary for ticket wholesalers to not only put a hobo in front of a computer, but to apply for a credit card for the hobo as well? And this is because Slashdot readers now all of a sudden support click-through EULA's on websites? The crux of the indictment is that Wiseguys defeated Ticketmaster's et al human identification by defeating Captchas and using purchased varied IP addresses.

The ticket windows (Ticketmaster et al) are trying to engage in price control, which never works. Ticket windows had limited success in outlawing ticket brokers. Now in the Internet era it seems ticket windows have discovered a legal avenue to harass the ticket brokers by calling automated Captcha completion "hacking".

Wiseguys never engaged in malware or theft. They merely sought to purchase what the ticket windows had for sale in response to the market distortions -- in the form of price controls -- the ticket windows had set up.

Re:"Bots" were their own, not bot farm

[AmonTheMetalhead]

I disagree, they committed fraud and various other less then legal trickery to basically defraud valid customers by preventing them the chance to actually buy a ticket.

Don't forget that the number of available seats at concerts & sports events is limited, by using botnets (their own computers or hijacked ones) they prevent honest customers from actually getting a place on the queue and the honest customer is forced with the option to buy a ticket with a scalper or to stay home, it's about bloody time they start enforcing ID checks so that scalpers can be liquidated (literally is also fine) for once & for all

In the past, you could beat the hobo's to a ticket because you could simply go camp at the sales point, with the internet, you no longer have that possibility, and scalping tickets needs to be eradicated.

Re:"Bots" were their own, not bot farm

[Anonymous Coward]

No, they intended to monopolize an event instead allowing free market to work, when the ticket seller with purpose put a system intended to distribute tickets to individuals the Wiseguys used specific controls to by pass that system so that they would have the majority of tickets and to force the individuals to come to them to purchase them. Thats as good as jumping in front of me in line and I'm really hoping to see them get a beat down.

Re:"Bots" were their own, not bot farm

[AmonTheMetalhead]

Read the indictment, they were charged with conspiracy, fraud & illegal access to a system, not to mention that using a farm of machines to bombard the ticket sale system overloads & locks out legitimate customers from gaining access to the tickets, and that's why people are pissed of the most, because they are prevented to acquire the tickets at real price.

Not to mention how the black market is unregulated & prone to fraudulent sales & forgeries

We pass so many useless laws, why not one for this

[haplo21112]

Just make it a law that its illegal to resell tickets for anymore than the face value.

Hell why don't we just go all the way and print the purchasers name on the damned ticket and if you don't show up at the event with positive ID sorry out of luck.

the supermarket adds value

[circletimessquare]

surely you can appreciate how and why

furthermore, in my example above, if the people can't afford $5, they starve. you don't consider that a problem?

what this guy is doing is nothing but robbery, but diffuse, rather than specific

it adds no value to the economy, it drains and destroys the economy, it is anticompetitive

what we are talking about here is the death of capitalism. the greatest enemy of capitalism is not communist thinking, but monopolistic and oligopolistic practices like this example. to keep capitalism healthy therefore you need constant government regulation and intervention. this really is the truth

my point is to counteract the extremely toxic libertarian and free market fundamentalist lie that markets left to their own will be healthy and fair: no, they won't. they will bubble and pop, they will be gouged, and the smaller players will be abused by larger players who take advantage of natural imperfections like in my example

in other words, the most committed capitalist in this word, if they really understand the marketplace, wants to make sure the government is heavily involved in the marketplace. but we have unfortunately in this world certain idiots who don't think about reality, but instead have this moronically simplistic, almost religious idea about how the marketplace works. and, through their ideology and efforts, such as dismantling the depression era protections that led the bubbling and popping of the current economic malaise, we all suffer mightily for their stupidity

Re:the supermarket adds value

[EastCoastSurfer]

furthermore, in my example above, if the people can't afford $5, they starve. you don't consider that a problem?

No, they won't starve. If the people pay the higher price someone else will come along and offer a lower price because of the profit involved. If the people don't pay the higher price for a week or two, then the new seller will simply lower their price so they are not sitting on a lot of useless product.

What you are trying to get at is a total monopoly situation where no competition can or will exist. Those are already regulated in capitalist economies.

Re:the supermarket adds value

[jimrthy]

they will bubble and pop, they will be gouged, and the smaller players will be abused by larger players who take advantage of natural imperfections like in my example

Hmm...where do we see this happening? Oh, yeah. That's pretty much a perfect description of the modern (heavily regulated) American economy.

in other words, the most committed capitalist in this word, if they really understand the marketplace, wants to make sure the government is heavily involved in the marketplace.

Maybe we're talking different languages here. In my world, "free market" is a situation where you can buy and sell your private property as you wish, without a gun to your head. "Government" involvement is a gun to your head. As I understand it, what you're describing is part of the definition of "fascism"--you can "own" property, and buy and sell, but the government's going to tell you exactly how, when, and where.

Given those definitions, how do you fit the way you were using the terms "capitalist" and "marketplace?"

but we have unfortunately in this world certain idiots who don't think about reality, but instead have this moronically simplistic, almost religious idea about how the marketplace works. and, through their ideology and efforts, such as dismantling the depression era protections that led the bubbling and popping of the current economic malaise, we all suffer mightily for their stupidity

Actually, it's the arrogant, almost religious idea that some Central Planners can control how the market place works that has led us to where we are now. And that idea's what made the Depression bad in the first place (but that's a different discussion). Central Planners cannot possibly keep up with a dynamic marketplace. By the time they get 1 regulation in place, it's obsolete. They need 3 others to work around the loopholes they've just created. The people creating those regulations are the parasites who add absolutely no value...but they've managed to brainwash people like you into believing otherwise.

All these regulations serve 2 purposes:

1. They make the barrier for entry higher for any new potential competitors
2. They make people feel warm and cozy that Mother Government is protecting them from the Big, Bad, Evil Capitalist who wants to...do whatever horrible thing you can come up with.

What they specifically do not do is protect anyone.

No matter what, some "Asshole" will figure out a way to work around the regulations that you like so much. In case you weren't paying attention, that recently happened with a bunch of banks. When their scheme started crashing down around their ears, the government (the ones who were supposed to be protecting us from those assholes) decided to go ahead and pay top dollar for all the rotten "flour" (to stick with your analogy) they'd been storing up over the years...leaving us to pay the bill.

That is reality.

If the regulations weren't there in the first place, at least we'd watch what they're doing and expect to be cheated.

p.s. Please don't blather about George W. Bust and "free market de-regulation." That's a myth that he and Greenspan floated around to try to fool people who would actually like to try something that resembles a free market. He added more regulations than anyone since FDR...and they did absolutely no good to anyone except those "assholes" you're so worried about.

Re:the supermarket adds value

[Anonymous Coward]

Worthless Products? The new seller needs only to sell half of his stock and still make a pofit.

WHo is at fault....both of course.

[hesaigo999ca]

If you leave the door open, then you are stupid for letting in the flies, if you leave the screendoor closed but the main door open, you are stupid in thinking it will be enough to stop a robber, and if you only use a metal plated door, you are stupid in thinking it will stop the terminator. CAPTCHAs have never really worked, even to the new image and text combo ones, i saw that came close once, but it was based on a few QA style system, so not 1 or 2 but 3 or 4 questions about the person just like when you call a phone bank service.

Anyways, the best way to really get security is with the secureid system, i have used and see its enormous advantage, the ID switches every so often, so even if you know the main password, you need the id to add the last part to concatenate to the rest. However, how many people log unto a website are able to have a system like that that can be verified other then companies giving their employees these. In this situation, I would say, make ticket sales phone based only. If this is something that is time sensitive and that in order to avoid one guy getting all the tickets based on a software that runs, then make it phone based only.

If you have a website ECommerce site, and it is used to sell products, the person logging to buy up all your products only makes you more money, but tickets is not in the same league as let's say buying a laptop or iphone off the internet. People are not too lazy that calling by phone will get them a secured ticket, but then again it would fall on ticketmaster to handle to cost of the phone lines...
which is something they want to avoid, unless they invest almost the same amount in R&D for a better system then what they got...either way, I guess I wont be going to see Metallica anytime soon.

You are missing the business idea...

[Anonymous Coward]

It is what they stole: they didn't have a business idea, so they stole one (ticket sellers).

You make it sound like if it is unreasonable to steal. It is unreasonable in moral terms, but in economic terms they did not have to come up with an idea and then fight in a marketplace to see it succeeed .... or fail, which is why stealing is attractive if you don't care about morals and why so many people keep doing it.

its called anticompetitive practices

[circletimessquare]

monopolies, cartels, price gouging, barriers to entry, price fixing, etc...

these are the enemy of capitalism, not a part of capitalism. capitalism is the refinement of competition to achieve a maximum of efficiency. anticompetitive practices therefore have no place in natural capitalism. anticompetitive practices therefore are a greater threat to capitalism than communism

its illegal most everywhere robbery is also illegal, because its the same thing as robbery, but diffuse rather than specific

please educate yourself

http://en.wikipedia.org/wiki/Anticompetitive

Re:its called anticompetitive practices

[Hognoxious]

its illegal most everywhere robbery is also illegal

No it isn't, and wishing it doesn't make it so.

please educate yourself

I think the need is greater elsewhere.

Re:its called anticompetitive practices

[ari_j]

I haven't read the entire thread. Are you claiming that the scalpers here are the enemy of capitalism or that the ticket sellers who, with monopoly powers, sell at a price below what the market will bear are the enemy of capitalism?

Ticketmaster fees are on the same level as scalpin

[Joe The Dragon]

Ticketmaster fees are on the same level as scalping so why not jail them as well.

You mean they aren't dynamically generated?

[davidwr]

Wow, I assumed that when used for "serious" applications they were either dynamically generated in real time or at least batch-generated and not re-used.

From the looks of things though, Slashdot's captcha pool is drawn from the top n=NOTSOBIGNUM words geeks would find humorous.

Ironically, my /. captcha is "profits" - hmm, maybe I'm wrong, maybe /. matches captchas to the topic of the article. On the other hand, maybe it's just an illusion. Am I still in The Matrix?

Except, as here, it can be done in advance

[Moraelin]

Except, as here, it can be done in advance. Once you can generate an ID of that image -- and that can mean simply a hash value of it -- you can store it in a database, and use it in that small window of oportunity when you need it.

Virtually every captcha I've seen applies a transformation or two of that image, from a small set of effects. So effectively you can end up with just one image for a given word, or a small finite set of distinct images. Add to that the fact that most use words from the dictionary, and the set of data you must store is actually very manageable.

Some transformations can even be filtered out before you hash, even if you don't automatically do an OCR on the word afterwards anyway. E.g., mixing colours can just mean you filter it to black and white before hashing, or theoretical more complex stuff (which I haven't seen actually used) can be defeated by contour tracing before you hash.

Once you have a way to get people to crack those for you, be it by reusing them for a "free" porn site or just paying some chinese kid a dollar an hour to crack captchas for you, you essentially just need some kind of caching to squeeze that information in the actual time window.

someone will try to take advantage of you

[circletimessquare]

no matter what you do

the best defense is a government

you counterclaim the government will then take advantage of you. so... you want no government? don't you see your vulnerability is worse without one?

i agree and understand all of your criticism of entrenched power. except that that the existence of no goverment is simply worse. so what you do is you accept the government, and work to make it as accountable and toothless as possible. such as with democracy. it will STILL result in abuses, but what you have done is minimized the abuses you will experience in your life

what you are doing, meanwhile: pointing out the abuses of government, to justify a state of being which is full of far more abuse: no government, is simply stupid

Re:someone will try to take advantage of you

[EastCoastSurfer]

the best defense is a government

ROFL. You're talking about the same government that poisoned it's own citizens during prohibition? The same government that spies on its citizens? Just checking.

No one is arguing for zero government. That would simply be anarchy. What people argue for is that we need much much less government than we have now.

Re:someone will try to take advantage of you

[jimrthy]

I think he's talking about those governments that murdered 162,000,000 of their own citizens.

Yeah, that's who I want defending me from the asshole who wants to sell me flour. Or concert tickets.

Re:someone will try to take advantage of you

[babblefrog]

This is obviously nonsense. No private criminals could kill the multiple millions of people that governments have done over and over again in the last century. Of course, that's always somebody else's government, until it isn't.

How many CAPTCHAs are there, really?

[Schrodycat]

So there were only hundreds of thousands of unique CAPTCHA images in use? Pretty lame, if it's true.

Scalpers are legitimate

[brian0918]

Scalping is a legitimate profession that serves a useful spot in the market. They provide convenience for customers, and help event ticket pricers determine what people are willing to pay. Not to mention the "scalpers" who are individuals trying to get their money back, for whatever reason - whether due to time conflict, or emergency financial situation, etc.

Or rather, scalping *would* be a legitimate profession, if people would embrace them, rather than try to shut them down.

Re:Scalpers are legitimate

[Anonymous Coward]

Creating artificial scarcity via exploiting a system is legit? useful?

Bullshit.

Give away the album and charge for the concert?

[tepples]

You appear to imply that kids shouldn't go to concerts in the first place. But a lot of other people who post comments to Slashdot like to suggest that recording artists make their recordings available for free on the Internet as advertisements for their concerts. So how should recording artists whose works are most popular among children who don't yet have a DMV ID card make a living?

Re:Give away the album and charge for the concert?

[plastbox]

How did you manage to not get that my post was intended as a joke..? Impressive!

Of course I agree that artists should have to work for money. What I am suggesting is that "artists" like Miley Cyrus and the Jonas Brothers, who wouldn't actually make a damn cent if not for advertising directed at children and their parent's wallets, should be banned from ever doing anything remotely musical again. At least until they are capable of making something that can stand on it's own feet, which is the requirement for non-Disney artistry.

Re:Give away the album and charge for the concert?

[tepples]

How did you manage to not get that my post was intended as a joke..?

Asperger syndrome. Sometimes I have to rely on the moderation to tell the difference, and it was marked Offtopic by the time I read it.

making something that can stand on it's own feet, which is the requirement for non-Disney artistry.

Are you claiming that films like Kill Bill (also by Disney) don't stand on their own feet?

Re:Give away the album and charge for the concert?

[plastbox]

Are you claiming that films like Kill Bill (also by Disney) don't stand on their own feet?

Are you claiming that Kill Bill and it's like stand on their own feet because of advertising directed at children..?

Re:Give away the album and charge for the concert?

[tepples]

Are you claiming that Kill Bill and it's like stand on their own feet because of advertising directed at children..?

No, I'm just reminding people that not all Disney products are for kids.

you're a wall of denial

[circletimessquare]

so what are you telling me? monopolies are legal? either a monopoly is legal, or it is illegal. depending upon the truth there, either you are wrong or i am wrong

so make a minimum of effort, find out they are illegal, and shut up already, moron

Re:you're a wall of denial

[Anonymous Coward]

Can you name one jurisdiction where monopoly is illegal?

Re:you're a wall of denial

[jimrthy]

Monopolies are illegal, except where they're legal.

i.e. When they've been sanctioned by the government. You know, that entity you trust so much to protect you.

They're even more insidious when you have government-sponsored duopolies, because then they can point at each other and say "See? There's our competition!"

Some examples "in reality" off the top of my head: water company, sewage company, power company, high speed internet providers, airports, and stadiums. I've been to places where the government owned all the liquor stores.

Want something that more closely resembles capitalism? Watch Wal-Mart move into a small town and wipe out pretty much all their "competition."

Re:you're a wall of denial

[Cytotoxic]

Monopolies are not illegal in and of themselves. However, once you have a monopoly you are subject to subject to strict oversight to ensure that you don't abuse your monopoly position. Hope I didn't deflate your sense of moral outrage.

What's wrong with what they did do, though?

[zippthorne]

What's illegitimate about ticket arbitrage?

If the customers weren't willing to pay their higher prices, they'd have lost money. Therefore the original ticket sellers mistake with regards to pricing was the real problem and would've lead to shortages. Further, by selling the tickets to an arbitrage firm (even accidentally) instead of directly to the customers, they were able to cut out a certain amount of volatility.

you bring up a good point

[circletimessquare]

so: two guys show up every sunday in the small town in the mountains, 10 bags of flour each

because of this competition, they have reached a natural equilibrium on price

now the asshole shows up and buys all 20 bags of flour and demands a 400% markup

my point still stands, with your fair alteration in the allegory to make note of the fact that market conditions are being destroyed

monopolistic, anticompetitive, straight up robbery. the behavior of the asshole is not defensible from the point of view of capitalism. his behavior is not a natural function of a healthy market, it is in fact the destruction of the market and behavior which is the enemy of natural capitalism. it cries out for regulation to keep the market healthy, which will take the form of hungry townfolk with pitchforks if no government is in place

Re:you bring up a good point

[Maniacal]

Sounds like capitalism to me. He's taking a risk by buying up all the flour. If he prices it over what people are willing to pay they won't buy it and he'll lose money. Some other smart business man will call his contact in the town over, buy up a bunch of flour there and sell it in this town for a 200% markup. He'll make a profit, undercut the 400% profit guy and put him out of business if he doesn't lower his prices. Some other smart business man will see the demand for flour booming and will buy up some high quality flour and sell it at an even higher price to folks who can afford, and desire, higher quality.

The original 2 guys make money, the 3 new guys make money. 4-5 other guys get jobs hauling flour. The other towns that make flour increase their sales. I like it.

Re:you bring up a good point

[JDmetro]

You like paying a 200% markup?

Re:you bring up a good point

[Phrogman]

And the poor customers are stuck with the choice of either paying 200% higher costs, or having to spend time and energy travelling to the nearest village that doesn't charge outrageous prices (assuming they aren't all controlled by an armed Flour Cartel, or the industry is a monopoly). In the end the customer suffers.
It may be Capitalism at its best but its also totally amoral in my opinion. I'll take government price regulation in industries that are providing essential materials (i.e. necessary food items) any day.

Look at the cable TV industry here in Victoria BC. There was a system where we had competition between Rogers and Shaw Cable. Rogers and Shaw reached an agreement and divided up western Canadian cities so that they each controlled certain cities and there was no competition. The price stabilized at about $20/mo for basic cable services. The Government stepped in and added the ability for other companies to participate in the market, but the barrier to entry costs are quite considerable, so few can afford to compete. However, Telus (a phone company) started offering cable TV services via their infrastructure. The cost was about the same initially, but now that Digital TV is the only option, the price has almost doubled (about $35) for the same service. Telus didn't lower there prices to compete, they merely matched the going rate, then everyone raised their rates with the switch to digital. The only person to lose out is the customer, again. Competition didn't actually work at all there. I am on Telus at the moment (and the service is lousy by the way, and in order to get any channels worth watching it costs about $65/mo, but that can easily ramp up. If you bundle your internet and phone with your TV signal, their top end package is $185/mo). I just don't buy the Randian "the free market is always right and always works" concept at all. There are too many examples where it doesn't seem to work for me at all.

Re:you bring up a good point

[musicalmicah]

Or the townspeople grab their knives, pitchforks, and torches and have an impromptu town meeting at this businessperson's place of business, not-so-politely requesting a price reduction so they can feed their children. At the risk of sounding like an ideologue, never underestimate the power of an angry underclass!

Re:you bring up a good point

[Maniacal]

And the poor customers are stuck with the choice of either paying 200% higher costs, or having to spend time and energy travelling to the nearest village that doesn't charge outrageous prices

Or, Option C - Another competitor enters the market undercutting the rest.

(assuming they aren't all controlled by an armed Flour Cartel, or the industry is a monopoly).

This, in my opinion, is when government needs to step in, not before.

Rogers and Shaw reached an agreement and divided up western Canadian cities so that they each controlled certain cities and there was no competition.

In some industries this would be considered a monopoly, which you discouraged earlier in your post. You do realize that this "agreement" was for their benefit, not yours. It allows them to charge you whatever they want due to the lack of competition.

The cost was about the same initially, but now that Digital TV is the only option, the price has almost doubled (about $35) for the same service. Telus didn't lower there prices to compete, they merely matched the going rate, then everyone raised their rates with the switch to digital.

Digital cable also costs more here in the United States. It might cost more to deliver digital but that's not really the point. The market wants digital. If they didn't someone would start a company selling analog cable service and make a killing, driving the digital only guys out of business or forcing them to lower their prices to compete.

I would imagine a horse and buggy is much cheaper than a car. You don't see people running out to start a horse and buggy company. Horse and buggy's are slow, don't have a stereo, and you get to spend all day smelling horse farts and watching it crap. It's a lot like analog cable. Market doesn't want it.

The only person to lose out is the customer, again. Competition didn't actually work at all there. I am on Telus at the moment (and the service is lousy by the way, and in order to get any channels worth watching it costs about $65/mo, but that can easily ramp up. If you bundle your internet and phone with your TV signal, their top end package is $185/mo).

Thank god for competition. You have a choice. You can choose Telus' competitor since you are unhappy with them. Imagine if it were government regulated and you didn't have a choice. Telus or nothing, that would suck.

I just don't buy the Randian "the free market is always right and always works" concept at all. There are too many examples where it doesn't seem to work for me at all.

So, what would work for you, is that the government controls the prices. Instead of cost+ or supply/demand the carriers would be forced to charge the price the government sets. So when the cost of delivering those services is higher than what the government allows them to charge they should just go out of business? Oh, maybe the government could subsidize them. Yeah. Then everyone in canada could help you pay for your cable TV. Even the people who don't own TV's. That'd be cool. Maybe subsidies wouldn't work and the Government would have to take them over, or buy a controlling stake to keep them in business. Then the Government would own the media you consume. I'm sure they wouldn't abuse that power.

I could go on and on. What's the point. I'm a capitalist, you're a socialist. Let's leave it at that. Maybe we could have a beer sometime if you have to come down for a surgery or something.

Re:you bring up a good point

[AcidPenguin9873]

You're right about this analogy with flour, but this analogy fails when it comes to ticket scalping, and it amounts to a lack of competition. Another company cannot come in and offer another Metallica concert in the same town on the same day (or even the next day) as the first Metallica concert in order to compete. There is only one Metallica, and usually Metallica does all of its booking through a single production company.

It amounts to a localized monopoly, where the production company has a monopoly on the market. The company has decided that tickets to that show should be sold for a certain amount - usually whatever it takes to cover costs plus a reasonable profit for the company. The scalpers then come in and buy all the tickets, giving *themselves* the monopoly, and they offer the tickets for sale at vastly higher amounts, much more than their own costs of running the botnet or whatever. They are certainly taking a risk that not enough of the tickets will sell to cover their capital investment, but the risk is greatly reduced because of the inflated price at which they offer the tickets, which they hold because they are now a monopoly. They may only need to sell half the tickets to cover the original capital investment.

It would be absolutely outstanding if scalpers created a new market where new companies were able to come in and bid down the price of these concerts, but the actual act/performers themselves are the scarce thing that prevents this from happening.

I like the solution that someone else pointed out, which effectively wipes out the artificial monopoly that scalpers create for themselves. If a show sells X% of its tickets, automagically schedule another show in the same venue for the next day.

Re:you bring up a good point

[metaforest]

Hey WoW players!!!

You wanna see market manipulation in the small.... go watch the price of a common commodity like 'Goldthorn' or 'Neitherweave bags' it helps if you install and use 'Auctioneer' so you can get some meaningful data to analyze.

So, on Thursday you will see sellers posting their goods for the weekend crowds. By Thursday around midnight server-time count the number of over-priced auctions and the number of auctions that are at or below market price.
Especially take note of the auction details for at market and below market 'neitherweave bags' as these show WHO MADE IT, not just who is selling it.

Count again every few hours. More often than not you will see:

* The number of at or below market auctions decrease, while the number of above market auctions increases by a almost the exact same number.
* Notice that the Seller of the new over-price auctions is the same as previous over-priced auctions, and the creator of the objects were the previous sellers. By Friday evening only the extreme markups are left. The manipulators had the resources to buy out all sellers who were content to sell at or below market.

As they drive the median price up over weeks and weeks of manipulation they gain a hefty profit, and they also end up with a sizable inventory of product purchased below market. When the market price climbs too high for them to effectively push it up any higher, they dump their conserved inventory in large bursts well below current market, but still above the older fair market, thus driving the market back down.... and freeing their warehousing. They then move on to another commodity.

It only takes a few clowns with deep-pockets to do this to a low to medium activity server to dominate any market they enter. Some do it as in-game sport. It also generates gold-farmer inventories. None of it is fair to players just trying to supply their toons, or generate fair return on their legitimate resource farming income if they happen to post during the "dumping cycle" of a market maker.

Re:you bring up a good point

[WuphonsReach]

Sounds like normal market PvP in EVE Online. (There's always people attempting to corner the market in a particular good - once the margins get too high, competitors come out of the woodwork.)

its illegal

[circletimessquare]

http://en.wikipedia.org/wiki/Anticompetitive

It is usually difficult to practise anti-competitive practices unless the parties involved have significant market power or government backing.

Monopolies and oligopolies are often accused of, and sometimes found guilty of, anti-competitive practices. For this reason, company mergers are often examined closely by government regulators to avoid reducing competition in an industry.

Although anti-competitive practices often enrich those who practice them, they are generally believed to have a negative effect on the economy as a whole, and to disadvantage competing firms and consumers who are not able to avoid their effects, generating a significant social cost. For these reasons, most countries have competition laws to prevent anti-competitive practices, and government regulators to aid the enforcement of these laws.

what the hell is wrong with you people?

this is pretty obvious basic simple economics here. is it really true that a lot people out there believe this anticompetitive bullshit is acceptable, even legal? do you not see the common sense basis for how this sort of practice destroys the marketplace, if you don't readily appreciate the simple illegality of the practice?

one would think all of this is obvious and simple conceptually

i find it hard to believe so many of you think this is fair or legal or acceptable on any moral, legal, or philosophical basis

Re:its illegal

[Maniacal]

You make good points about anti competitive practices being bad for capitalism but you're not taking into account the context. Event tickets are not a necessity, they're a luxury, so you can't compare this to selling flour or other necessities. Government should be involved in breaking up monopolies, or exposing and breaking up price fixing schemes, but only when it's something that people HAVE to buy to survive. If these guys buy up all the tickets and price them too high no one will buy them and they'll lose their ass or reduce their prices. Or Walmart and Ross will come along and buy up their surplus inventory at pennies on the dollar and sell the tickets for even less than they were originally sold for.

Government needs to step in if some peckerhead buys up all the water in a town that is destroyed by a hurricane and tries to sell it for $20 per bottle. Government needs to interact if all the gas companies get together and decide to artificially inflate gas prices to make more money. Government doesn't need to step in so my kid can go see OMG MILEY!!!

Re:its illegal

[TheKidWho]

Seems like everyone disagrees with you, maybe you need to rethink your views?

Re:its illegal

[jimrthy]

this is pretty obvious basic simple economics here.

I don't think "economics" means what you think it does.

is it really true that a lot people out there believe this anticompetitive bullshit is acceptable, even legal?

Acceptable only in that the alternatives are worse. Legal? Absolutely (well, I think it should be...if only because I don't want to waste my tax money on nonsense like this). They found loopholes in the regulations, exactly the same way "assholes" always will.

one would think all of this is obvious and simple conceptually

Obvious and simple solutions are usually wrong. Maybe it's time to re-take Econ 101, and pay attention this time. Actually, never mind. They're probably teaching the same tired, failed Keynesian BS that seems so obvious and simple from their ivory towers.

Go read some Murray Rothbard and get a dose of economics that are based upon reality.

i find it hard to believe so many of you think this is fair or legal or acceptable on any moral, legal, or philosophical basis

Life isn't fair. Ask any crack baby.

If this isn't legal, then it's an example of how nitwits have closed one loophole in the law and opened 3 others instead of letting the players in the market deal with the issue.

Acceptable? I hate scalpers as much as anyone. But this is actually a perfect example of why that "fixed pricing" model you seem to like so much completely falls apart in the face of reality.

Re:its illegal

[hitnrunrambler]

i find it hard to believe so many of you think this is fair or legal or acceptable on any moral, legal, or philosophical basis

Since you seem to not be reading what anyone says, this is the last reply I will make.

I find all sorts of business practices immoral and unacceptable... however no government anyway has passed a law against them.

Being philosophically evil is a standard business practice, and some (such as myself) might argue that capitalism as it exists rewards such evil. But the fact that something is clearly WRONG does not make it ILLEGAL.

Take your hypothetical flour example, there are no Anti-competitive practices described:

He has not colluded with competitors.
He is not preventing entry of anyone into the market.
His supplier is not contractually bound to deal only with him (or even with him at all).
He is doing the opposite of dumping.
His current position seems like a monopoly, but the presence of monopolistic circumstance is not illegal (particularly in short term situations); what is illegal is preventing competition from occurring.

and further more he is not even a monopoly.... Why?
Which governmental body has jurisdiction?
The Country or State? The $5 reseller is not the only person to sell flour within their jurisdiction so he is not engaged in a monopoly.

You have a lot of anger and frustration... this is good.
But only if you do something with it; and it has to be the right thing. Yelling "That's illegal" when something is not illegal is not the right thing.
Either work towards changing "legal" to be more representative of "fair", or educate others.

Before you can do any of this you must educate yourself.

Re:its illegal

[Archangel Michael]

practice destroys the marketplace

It destroys the marketplace for that product. It does not destroy the marketplace at all.

I don't have a problem with monopolies. REALLY, I don't. Problems are only opportunities in disguise. If all you see are problems, then you should be quiet and leave it to those of us with vision enough to see the opportunities be able to exploit them.

I dare say, that without Microsoft being a defacto monopoly, Linux couldn't exist. Microsoft is not a monopoly any longer, even though it may appear so, simply because Linux exists and IF Microsoft cannot offer value above "Windows" and "Office" people will simply move to Linux and OpenOffice.

And who knows what would have happened if we didn't break up Standard Oil 100 (or so) ago? We all might be running on ethanol or biodesiel, and not running up silly deficits to protect the middle east oil. Or perhaps we'd have something else we currently DO NOT HAVE because someone worked on a solution to a problem, because they see an opportunity.

Economics is amoral, and should be. The moment we step in and place "moral outrage" on economic issues we've lost the battle. Because now it becomes an issue of who's moral outrage do we employ? Mine? Yours? Muslim? Christian? Communist? Nazi?

Re:its illegal

[TheSync]

is it really true that a lot people out there believe this anticompetitive bullshit is acceptable, even legal?

Yes, I think anti-trust laws are totally stupid and unnecessary. I don't care what price a Miley Cyrus concert ticket is.

I do care that when I talk with competitors about file standards for our industry that I need to have a lawyer in the room to avoid being sued by someone for anti-competitive practice. Almost as annoying as broad patents that try to cover obvious things.

Paperless Tickets

[Kurt Granroth]

I love that you used Miley Cyrus as an example where the "Tom Waits" style ticketing couldn't work. In fact, Miley's entire tour was done in exactly that fashion! Her tour is the poster child of the so-called Paperless Ticketing.

Here's roughly how paperless works in a case like Miley's tour. A parent goes online and buys tickets for their daughter using a credit card. They are issued a receipt but no tickets. Instead, they are given instructions to bring their credit card to the show and present it for admission.

This caught some parents off-guard since they were expecting to just drop their kid off or maybe car-pool. Practically no parents actually go into the stadium for a Miley Cyrus concert.

Anyway, so on the day of the show, the parent and kid get to the gate and get their card swiped. If it checks out, then the kid goes on and there is a separate "loop" that brings the parent back out to wait for the show to end. If there are difficulties with the card (wrong card, card won't swipe, etc), then the parent is directed to customer support to get it resolved.

It worked very very well. Yes, it was somewhat inconvenient to have to physically be there to present your card, but there were very few complaints in the end. I think most people were just glad that they could get tickets at a reasonable price. Miley's previous tour was fraught with scalpers selling tickets in the thousands of dollars.

Re:Paperless Tickets

[tepples]

So the tickets were handled much like a Best Buy in-store pickup, and only the purchaser had to have bank-issued ID. That's very different from the scheme that BartholomewBernsteyn mentioned of requiring all attendees to have ID, and AC pointed out a convenient workaround for scalpers.

Re:Paperless Tickets

[Kurt Granroth]

Yeah, the idea of Paperless isn't new. The movie industry has had this for years, for instance. It's just (relatively) new in the ticketing industry.

And I would disagree that it wasn't successful for the Miley tour; it was phenomenally successful. AC's comment about using one-time-use cards was definitely a workaround and it did happen... but percentage-wise, it was nothing compared to how much those tickets were normally scalped. Just because a system isn't 100% foolproof doesn't mean it doesn't have any value at all.

what the hell is wrong with you?

[circletimessquare]

http://en.wikipedia.org/wiki/Anticompetitive

It is usually difficult to practise anti-competitive practices unless the parties involved have significant market power or government backing.

Monopolies and oligopolies are often accused of, and sometimes found guilty of, anti-competitive practices. For this reason, company mergers are often examined closely by government regulators to avoid reducing competition in an industry.

Although anti-competitive practices often enrich those who practice them, they are generally believed to have a negative effect on the economy as a whole, and to disadvantage competing firms and consumers who are not able to avoid their effects, generating a significant social cost. For these reasons, most countries have competition laws to prevent anti-competitive practices, and government regulators to aid the enforcement of these laws.

like you said, this is mickey mouse Econ 101 stuff. why don't you understand this? why don't you appreciate the fact that on any simple moral, philosophical, or ideological basis, nevermind legal basis, that the practice you are supporting and condoning with your words is a straightforward enemy of capitalism and a free market destroyer?

Re:what the hell is wrong with you?

[geekoid]

Because it's not.It's concert tickets, not food.

"simple moral" Don't fucking tell me what morals I should have, asshole.

"philosophical" Putting this in their makes you look like an idiot who doesn't understand what it mean. Let me clarify it with on simple sentence: "Whose philosophy?"

" ideological basis" Whose ideology? You're argument is so weak, you have to invoke vague meaningless statements as 'support'.

You have really blown this out of proportion. It's for some fucking music concert and sports games. Don't like it? get to the window early, you lazy ass.

Re:what the hell is wrong with you?

[Aquitaine]

Like many things with modern politics, it's simply a matter of degree.

Does the market exist with unique attributes making it a perfect storm of easily abused, vital to the public good, and immune to normal market solutions (i.e. competition)? Sure. There are absolutely areas of the economy where laissez-faire capitalism doesn't work - the problem is that we've given the govenrments of the world near carte-blanche with respect to identifying and policing these. Make a few political enemies? Better hope you're not suddenly 'anti-competitive!'

Your flour scenario is a perfect example. You've grossly exaggerated what is nonetheless a very real problem in need of solving but you've applied it to a case that would be very easily solved by the market. It didn't seem to occur to you that the scenario you described is not only perfectly normal, but desirable - bad behaviors in any normal market won't last long because of competition. Buying something at $x and re-selling it at $y isn't anti-competitive.

The threshold for what is anti-competitive and the markets to which that threshold should be applied is a question that deserves a lot of scrutiny and consideration -- and it hasn't got much of either, because just about everyone is confident that Big Brother is going to take care of it all for them, with very little mind to the fact that government is just as inherently corrupt as business, only without the constraints and self-correcting measures the market has.

No serious capitalist pretends that people aren't (on the whole) greedy bastards who will do anything they feel they can get away with if it gains them money or power. But the serious capitalist believes that the market will restrain most (but not all) bad behavior for the same reason that I don't rip people off when I'm running my small business, even though it would be quite easy to get away with it -- when the consumer has choices, some combination of quality, price, and reputation had better make them settle on me and not my competitor, or else I go out of business and become a wage drone. Probably for the competition.

My line of work (hosted application development) is almost completely unregulated and I certainly hope it stays that way. My fiancee is in medicine and you couldn't pay me enough to put up with what doctors have to deal with these days.

I also don't support ticket scalping. I never buy from scalpers because I think they're mostly sleazy, even if they are a natural market phenomenon. I don't like Ticketmaster either, and will try to buy tickets from some of Ticketmaster's smaller competition whenever I can. My point is that I understand ticket scalping and I know that the government can't do much about it -- and in cases where the government tries, they end up hurting the legit people as well.

You can't regulate away human nature. You can and should try to make it transparent whenever possible, but for so long as we have luxuries like concerts available (and they are luxuries) then there will be people willing to pay a premium for access and there will be a market to serve them. Empowering a busybody bureaucrat to try and pretend that's not the case is hardly ever the answer.

Original Live Aid and the Scalpers Scalped!

[AGMW]

I was lucky enough to get a couple of tickets to the original Live Aid gig in Wembley and the word went out that there were tickets still for sale at the box office and to not buy from the scalpers. After an hour or so the scalpers realised they were never going to sell any tickets, even at reduced prices (because everyone was so intent on helping the 'cause' and the scalpers had already bought their tickets!) that they gave up and handed in all the tickets to the box office where they were re-sold by the event to raise yet-more cash!

But isn't it similar to the success spammers have with spamming? If no one answered the spam emails they'd go out of business, and it's the same with the scalpers ... if you simply don't buy off them they will also go out of business!

That said, I don't see what's wrong with it and how you can make general scalping illegal and yet still permit Joe Schmo to sell a couple of spare gig tickets if some of his mates can't make it on the day?

Re:Original Live Aid and the Scalpers Scalped!

[Ill_Omen]

That said, I don't see what's wrong with it and how you can make general scalping illegal and yet still permit Joe Schmo to sell a couple of spare gig tickets if some of his mates can't make it on the day?

It's generally legal to resell tickets at close to face value (IANAL, YMMV). So as long as Joe doesn't significantly mark up his tickets that he sells to his mates, he's OK. The legallity gets called into question when he attempts to sell $40 tickets for $150 because everyone wants to see the Red Sox and the game is sold out.

Re:Original Live Aid and the Scalpers Scalped!

[Anonymous Coward]

It's generally legal to resell tickets at close to face value

How close? 10% more? 20% more? More by an amount not exceeding 15% or 10 bucks (whichever is greater)?

Shove it back where you pulled it from, idiot.

Illegal?

[iamacyborg]

These guys were providing a service, ensuring that tickets are distributed based on who is the biggest fan and willing to pay the most, instead of who is the fastest to click a button. The real problem is that the venue intentionally prices the tickets below the market price, so the demand for the tickets greatly exceeded the supply - leading to a demand for services like these guys provide.

Re:Illegal?

[NeoSkandranon]

Willing to pay able to pay

Re:Illegal?

[iamacyborg]

So they're running a charity?

Re:We pass so many useless laws, why not one for t

[NonUniqueNickname]

The organizers aren't losing money to the scalpers. All the tickets are sold at the price they set.
It takes longer for people to get into the venue if the doorman has to check IDs. That would cost the organizers money.
Kids and teenagers go to concerts too. Should the doorman accept a library card?
We don't want to kill the social habit of giving your tickets away to your friends at the last minute when you're unable to go to the show. It's a good habit.
If we're going to have a law that makes it illegal to hike the resell value of goods, how about starting with some basic goods that preserve life: Bread, milk, baby formula, water, internet access. Concert ticket are a luxury item by any definitions, they should not be given special protection over basic goods.

Just embrace the free market. Embrace it.

Monopolies

[Thaelon]

Yet nobody is complaining over the monopoly, or near monopoly held by Ticketmaster and Livenation (who are looking to merge, actually so they can fuck you even harder).

Ever heard of the infamous Ticketmaster(TM) "convenience fee"? That's right, they charge you a "convenience fee" just because they can get away with it because you don't have a choice. It's a market in dire need of some trust busting. Fortunately it's pure entertainment and concert going is not something your life depends on.

Re:Monopolies

[drew30319]

I thought it was especially funny when they offered the option of printing tickets at home, for which they charge you an additional fee. So, I can print the ticket myself using my paper & ink and pay extra, or just let them incur postage and shipping fees.

Idiots.

Re:Monopolies

[TheSync]

Ever heard of the infamous Ticketmaster(TM) "convenience fee"?

A look at their SEC filing shows that most of the "convenience fee" ends up going back to the venues as exclusive lock-in fees. This shifts risk away from the venue by replacing variable earnings from tickets into dependable flat payments from Ticketmaster.

Mods

[BancBoy]

Throw this guy a funny, puh-lease.

Scalping == good

[CapnStank]

Scalping can be good too... My girlfriend wanted to attend a concert because of a certain artist playing. We bought the tickets and a month before the event the artist we desired cancelled. The other artists were still performing so Ticketmaster refused to issue a refund because our preferred artist was listed as "a guest" and not headlining the show. What did we do? Got our money back. I'd be out $180 if scalping was illegal.

Re:Scalping == good

[OrangeTide]

The only draw back I see to allowing scalping is when people sell fake tickets. This is the risk people take when they buy tickets outside of a show from some random dude.

What about the taxes

[JDmetro]

I'm sure the scalpers are paying taxes on the money they make ripping people off.

or cell-phone number

[peter303]

Some organization are experimenting with a system where the ticket is locked to the cell phone you bring.

"the file ID of each CAPTCHA"?

[hondo77]

The geniuses at Ticketmaster saw nothing wrong with having each CAPTCHA image identified by the same ID over and over?

Mod parent up

[twoallbeefpatties]

I'm really getting tired of this argument that scalpers don't cause any harm, as if driving up prices simply to create profit for a middleman never had any externalities.

Excuse me, but a piece of my tax money went to funding the creation of this stadium in our city. The point to building that stadium was to attract large acts and attractions to the city, making it a more enjoyable place to live. Now you're going to tell me that when those acts come to town, only the upper third of the city is going to be able to afford that concert. I guess it's great for them, but it's a raw deal for the rest of us.

There is a cultural concern for people. Ask an artist how he feels when his concert only goes 60% full because of unsold scalper tickets, and what effect that word of mouth about low-event concerts where the only audience members are the ones with the largest wallets. Does that have an effect on album sales, merchandise sales in the future? Ask your son what kind of cultural connection he has the local sports team - much worse the Yankees, or the Lakers - when he's never seen them play live, and likely never will since the ticket prices are so high. What effect does that have on the future sales of jerseys, on the number of people in the city that ignore the team altogether? No, really, honest question - what is the actual effect of inflated prices that don't go to benefit the team itself? Maybe the team did an economic study that showed that they make more money in the long run if prices are held to a certain level, provided scalping externalities don't come into play.

I'm gonna say something here that's going to get me modded -1 socialist, but what good does that extra ticket price do? It isn't going to benefit the artist or team directly. It won't provide upkeep for the stadium. It's paying someone else just for the privilege of saying that they'll put the tickets up on eBay for you. What do you think would happen if a city - instead of trying to outlaw scalping - enacted a scalping tax? When you sell a ticket, you owe 50% of your profit over the original resale price of the ticket. For the individual seller, this means that if you have tickets that you just want to get rid of, then you can sell them at original price without penalty. For the big name scalpers, it means that those sales at least go back into helping the city that helped to provide space for the attraction in the first place. Just a thought.

Re:Mod parent up

[Cytotoxic]

Excuse me, but a piece of my tax money went to funding the creation of this stadium in our city. The point to building that stadium was to attract large acts and attractions to the city, making it a more enjoyable place to live. Now you're going to tell me that when those acts come to town, only the upper third of the city is going to be able to afford that concert. I guess it's great for them, but it's a raw deal for the rest of us.

I hate to point this out when you had such a great rant going, but the answer to this is to quit subsidizing stadiums. Simple, problem solved.

I wish my local representatives would get this message. We've voted down funding a new stadium time and time again.... so they finally just went ahead and approved funding without us. Brilliant. I wonder how big those kickbacks are.

Re:Mod parent up

[twoallbeefpatties]

Which is not to say that I disagree with you at all, but now that the stadiums are built, I can't quite get them torn down again and scrapped for cash.

Worse than airline tickets?

[twoallbeefpatties]

Y'know, I'm sorry to say this, but I'll vastly prefer a system that forces me to show up with the people I bought tickets for, where I can't buy gift tickets, and I have to show ID at the door to a system where I can't afford the ticket. I would submit this is not a process greatly different process from getting on an airplane. Tell me, would you pay $300 more per airline ticket if it meant you could buy your tickets on eBay and bypass security?

Re:Worse than airline tickets?

[Cytotoxic]

Y'know, I'm sorry to say this, but I'll vastly prefer a system that forces me to show up with the people I bought tickets for, where I can't buy gift tickets, and I have to show ID at the door to a system where I can't afford the ticket. I would submit this is not a process greatly different process from getting on an airplane. Tell me, would you pay $300 more per airline ticket if it meant you could buy your tickets on eBay and bypass security?

Funny that you chose that example, because this is how airlines price their tickets. People sitting next to each other on the same flight pay vastly different amounts for their seats - maybe even an order of magnitude different. You can even pay extra to skip ahead in the security lines. There are also "scalpers" in the airline industry - they are called consolidators.

I'll pass on any system that increases the power of the Ticketmasters near-monopoly. They already add way too much to the cost of a ticket relative to the value added.

Ticketmaster did it too, only worse

[freelunch]

The FTC gave TM a slap on the wrist for doing the same thing, and then they approved TM's acquisition of Live Nation. Their conduct was arguably much worse.

Ticketmaster Reaches Settlement on Complaints of Deceptive Sales

The Federal Trade Commission has reached a settlement with Ticketmaster over complaints that the company used deceptive tactics to steer Bruce Springsteen fans to more expensive tickets through its own reseller last year.

The complaints stemmed from 14 Bruce Springsteen concerts last year where fans were steered to a Web site with inflated prices.

The settlement, announced Tuesday by the F.T.C.'s chairman, Jon Leibowitz, came after an investigation into 14 Springsteen concerts last May and June in which thousands of customers on Ticketmaster's Web site were pointed to TicketsNow.com, an eBay-like resale marketplace with no price caps, that offered similar tickets at inflated prices.

In some cases, brokers on TicketsNow advertised tickets they did not have, and the fans never got the tickets they paid for.

Under the terms of the settlement, Ticketmaster must pay refunds to fans and disclose the availability of tickets it resells through its subsidiary.

"TicketsNow.com sold phantom tickets without letting consumers know that the tickets did not exist," Mr. Leibowitz said in a statement. "Then, the company held onto consumers' money, sometimes for months, when it knew those fans weren't going to see Springsteen. Clearly consumers deserve better. They deserve to know what they're buying, including the risk that their tickets won't materialize."

Re:What is illegal?

[hitnrunrambler]

If this turns out to be a double post sorry.... it looks like /. somehow ate my first one

I find all sorts of business practices immoral and unacceptable... however no government anyway has passed a law against them.

Being philosophically evil is a standard business practice, and some (such as myself) might argue that capitalism as it exists rewards such evil. But the fact that something is clearly WRONG does not make it ILLEGAL.

Take your hypothetical flour example, there are no Anti-competitive practices described:

He has not colluded with competitors.
He is not preventing entry of anyone into the market.
His supplier is not contractually bound to deal only with him (or even with him at all).
He is doing the opposite of dumping.
His current position seems like a monopoly, but the presence of monopolistic circumstance is not illegal (particularly in short term situations); what is illegal is preventing competition from occurring.

and further more he is not even a monopoly.... Why?
Which governmental body has jurisdiction?
The Country or State? The $5 reseller is not the only person to sell flour within their jurisdiction so he is not engaged in a monopoly.

You have a lot of anger and frustration... this is good.
But only if you do something with it; and it has to be the right thing. Yelling "That's illegal" when something is not illegal is not the right thing.
Either work towards changing "legal" to be more representative of "fair", or educate others.

Before you can do any of this you must educate yourself.

Re:We pass so many useless laws, why not one for t

[haplo21112]

My comment was mostly sarcasm, with a tiniest bit of rage intermixed. Really I'm just damned sick of not being able to purchase decent concert tickets. ex, 5 minutes after they go on sale which is as fast as you can get through to order all that is left is the nosebleed sections.

Proof about the authorities.

[bezenek]

"the authorities said.' I guess you can break any system like CAPTCHA if you want it badly enough."

All this proves is the "authorities" do not know computability theory.

I.e., it should be impossible to make a CAPTCHA which will work for every person and will not be breakable by a machine.

-Todd

Re:We pass so many useless laws, why not one for t

[TheSync]

Hell why don't we just go all the way and print the purchasers name on the damned ticket and if you don't show up at the event with positive ID sorry out of luck.

Some artists (such as Miley Cyrus) are insisting on "ticketless" ticketing, where you just show your credit card and ID at the venue.

There is a tension between artists who want to seem like anyone can buy a cheap ticket, the venues who dislike the variability of ticket sales, ticketing companies that make money by mitigating the risk to the venue, and brokers who mitigate the risk to the ticketers. A "sure sell-out" artist like Miley Cyrus can do "no-scalping" ticketless ticketing, but most artists who may or may not sell out a venue could not get the venue to agree to ticketless ticketing without reselling.

Bag of Crap - Calendar Edition

[Fnord666]

Maybe Ticketmaster could use the same response that woot.com used recently. It seems that every know and then woot.com offers a "bag of crap" for sale. The shipment contains random stuff, but is almost always a good deal. So good, in fact, that a significant number of wooters have automated buying scripts that look for these deals. When one comes along, they sell out in seconds. One day not long ago, woot offered for sale a "bag of crap - calendar edition" or something similar. The scripts matched on the text and bought as quick as a flash. I don't know how many warehouses of desk calendars woot was able to get rid of, but it was spectacular.

Ticketmaster just needs to price all tickets at $10,000 each for the first 10 minutes. See how many of these tickets the automation buys.

Technical challenge

[Wayne247]

So while just about everyone on this thread is actively debating the legality of mass-buying and reselling tickets, as a Slashdot member, I'm interesting in how they broke the system.

It seems to me that, while reCAPTCHA created a very interesting system, they exposed themselves to a ridiculously simple attack: the reuse of previous catpchas and the reuse of their identification numbers.

Fixing this would be very easy. I'm thinking of this method:
1. Every graphic image of captcha in the system is assigned a unique ID along with the response, just like it is right now.
2. When an external website requests a challenge, the system picks a captcha ID at random in the database.
3. Take this captcha ID and write it in a database, along with a random number.
4. From now on, the random number (ie "public random ID") is used for the website that is using it.
5. As soon as the challenge is solved (website proceeds with the rest of the user authentication), the public random ID database item for this number is marked "Wasted", and will never be used again.

There! Fixed.

they STARVE genius if they don't see Miley Cyrus

[clambake]

wut?

Say what?

[Hognoxious]

They identified the file ID of each CAPTCHA challenge and created a database of CAPTCHA "answers" to correspond to each ID.

Sorry, they reuse the IDs rather than munging them? How hard is it to rename a file?

While that's less retarded than calling the file $WHATTHEANSEWRIS.jpg the difference isn't much.