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Paradise Papers Expose Canadian Scalper's Multimillion-Dollar StubHub Scheme (www.cbc.ca)
An anonymous reader quotes a report from CBC.ca: When Adele fans went online to buy tickets to the pop superstar's world tour last year, they had no idea what exactly they were up against. An army of tech-savvy resellers that included a little-known Canadian superscalper named Julien Lavallee managed to vacuum up thousands of tickets in a matter of minutes in one of the quickest tour sellouts in history. The many fans who were shut out would have to pay scalpers like Lavallee a steep premium if they still wanted to see their favorite singer. An investigation by CBC/Radio-Canada and the Toronto Star, based in part on documents found in the Paradise Papers, rips the lid off Lavallee's multimillion-dollar operation based out of Quebec and reveals how ticket website StubHub not only enables but rewards industrial-scale scalpers who gouge fans around the world.
Lavallee's name appears over and over in the records, alongside the names of his wife, his father and other friends and family. The records show them somehow buying tickets from different locations around the world at the same time, placing orders from cities like Chicago, Los Angeles, London and Montreal. Lavallee, who got his start in his early 20s reselling hockey and concert tickets while living at home with his parents, now runs an international ticket harvesting operation. Financial records detail $7.9 million in gross sales in 2014 alone. [T]he CBC/Star investigation also discovered a password-protected portal exclusively for StubHub's top sellers who prove they can move more than $50,000 worth of tickets a year. The company offers them special software to upload and manage huge inventories of tickets. StubHub said in a statement: "StubHub agrees that the use of bots to procure tickets is unfair and anti-consumer. StubHub has always supported anti-bots legislation and encourages policy-makers to look comprehensively at the host of factors that impact a fan's ability to fairly access, buy, resell, or even give away tickets in a competitive ticket market."
Lavallee's name appears over and over in the records, alongside the names of his wife, his father and other friends and family. The records show them somehow buying tickets from different locations around the world at the same time, placing orders from cities like Chicago, Los Angeles, London and Montreal. Lavallee, who got his start in his early 20s reselling hockey and concert tickets while living at home with his parents, now runs an international ticket harvesting operation. Financial records detail $7.9 million in gross sales in 2014 alone. [T]he CBC/Star investigation also discovered a password-protected portal exclusively for StubHub's top sellers who prove they can move more than $50,000 worth of tickets a year. The company offers them special software to upload and manage huge inventories of tickets. StubHub said in a statement: "StubHub agrees that the use of bots to procure tickets is unfair and anti-consumer. StubHub has always supported anti-bots legislation and encourages policy-makers to look comprehensively at the host of factors that impact a fan's ability to fairly access, buy, resell, or even give away tickets in a competitive ticket market."
It would be so easy to shut out scalpers by selling tickets through dutch auctions. If you grab them all early, you pay a big markup.
ID: the nose did not occur naturally, how would we wear glasses otherwise? (apologies to Voltaire)
Why not just sell the tickets at the market clearing price?
If you aren't sure what is the "correct" price, then just set it high, and drop the price a few percent each day until they all sell.
Then the profit goes to the artist and venue rather than the scalpers.
Scalpers are a result of a dysfunctional market. There are no scalpers selling milk outside the grocery store.
If people are willing to pay a scalper 1.5x, 2x, or 3x the face price, that just tells me that the original price was too low.
That's what every real estate, product or service seller is thinking -- how do I extract all the money my customer has? And it's called gouging. This is why the working class is always working; their increased income is absorbed by increases in product prices.
Right of first sale here.
"Right of first sale" is not a universal principle, for instance you cannot resell a plane ticket, or a fishing license. In some jurisdictions, scalping is illegal.
Why not just sell the tickets at the market clearing price?
I know you won't believe this, but artists aren't all rich assholes who only want other rich assholes to see their performances.
They can donate as many tickets as they like. A simple free auction would handle this real quick if it was the real reason they are keeping prices artificially low. You must think these artists are monumentally stupid if they think low ticket prices help out consumers and not just scalpers.
The only reason scalpers can make money is the ticket brokers like the service they provide (mitigating risk, media buzz from immediately selling out, etc) There are numerous ways the ticket brokers could cut out all the scalpers if they wanted. Raising prices, auction, non-transferable tickets, and many others. The ticket brokers like scalpers, and this is the only reason they exist.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
And that is why the poor violently rise up and kill the rich. It's just economics.
Not even close. Maybe live event scalping is different than product scalping though.
I tried, and ultimately failed, to sell into the toy market (action figures specifically). The issues as I see them are that "manufacturers" (they don't really manufacture) and retail outlets consolidated in the last 20 years. Hasbro, in particular, swallowed up _alot_ of competition. As the remaining players grew bigger, they did what every big company inevitably does - they made excuses about how hard it was to deal with small customers. I remember one story about how when Power Rangers was new, an independent shop went to reorder and found that Bandai had raised the minimum order from $10K to $90K overnight, which shut out the independent shop from dealing with Bandai ever again. So now they basically sell to Walmart, Target, TRU, and a handful of distributors.
Going through a distributor is a waste of time. It's actually cheaper for me to wait for one of the big three to run a sale. Even if it weren't, Hasbro in particular plays games with distributors, soliciting products with false delivery dates only to deliver months late after sales at the big three are slowing down. Then they deliver your product, at almost retail price, and immediately thereafter the big three do their clearances to undercut you. But...here's the other issue...the big three do a pretty lousy job with distribution. I live in a state where I can't buy toys at retail because they don't stock toys at retail (incidentally, why I thought I had a shot at success). So I have to wait for independent shops who still bother to put up with this bullshit to get their stock in...and sometime I just find other things to spend my money on. Then they all make retarded statements like how kids just don't like toys anymore. Or cry about Walmart being mean and controlling.
Prices aren't too low. Distribution is fucked up and competition is non-existent.
As it relates to event scalping...haven't alot of these events consolidated down to very small number of organizers and TicketMaster for distribution?