SoylentNews is people
SoylentNews
from the no-wonder-I-couldn't-get-tickets dept.
Submitted via IRC for SoyCow1984
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 Lavallée 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 Lavallée a steep premium if they still wanted to see their favourite 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 Lavallée'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.
CBC News obtained sales records from three U.K. shows that provide unprecedented insight into the speed and scale of Lavallée's ticket scam.
Despite a four-ticket-per-customer limit, his business snatched up 310 seats in 25 minutes, charged to 15 different names in 12 different locations.
The grand total? Nearly $52,000 worth of tickets at face value.
Source: http://www.cbc.ca/news/business/paradise-papers-stubhub-1.4395361
(Score: 0, Troll) by khallow on Tuesday November 14 2017, @04:02PM (26 children)
(Score: 4, Informative) by sjames on Tuesday November 14 2017, @06:17PM (12 children)
The limited number of tickets isn't artificial, it's just a representation of the scarcity of physical space. Economically, the scalpers are rent seekers in fairly pure form.
(Score: 1, Disagree) by khallow on Tuesday November 14 2017, @06:57PM (11 children)
A representation is artificial.
Not if you decide to buy a ticket right before a sold out event happens.
(Score: 3, Insightful) by sjames on Tuesday November 14 2017, @07:12PM (10 children)
Let's skip the silly sophistry. "artificial scarcity" has a specific meaning and that ain't it.
Yes, even then.
(Score: 1) by khallow on Wednesday November 15 2017, @02:06AM (9 children)
But such representations are a routine way that artificial scarcity manifests such as with digital rights management. Let's consider the title of this thread, "Stop Buying From Scalpers". Why do people buy from scalpers in the first place? Because they are the sellers of last resort when everyone else runs out of tickets. The problem here is that tickets are in artificial surplus when they're first sold and artificial scarcity by the time the last minute people want to get in on a sold-out concert. Most of the problem would go away [wikipedia.org] with dynamic pricing similar to how airlines do it combined with partial refunds after a certain point close to the beginning of a concert (a refund to encourage people to turn in unused tickets and partial to generate some additional risk for scalpers trying to corner the market).
Or just sanction the activity and create a market where the ticket issuer auctions the tickets off and people can speculate on ticket prices to their hearts' desire. It's just not that big a deal.
(Score: 3, Insightful) by sjames on Wednesday November 15 2017, @08:21AM (8 children)
There's no such thing as an artificial surplus. There are N seats available and N tickets to go with those seats. No more, no less.
The part you're missing is that the scalpers CAUSE the seller to run out of tickets much sooner with the express purpose of causing prices to rise. They are an economic inefficiency. They are rent seekers because they get in between seller and the ultimate buyer and suck value out of the transaction without producing any value.
Do read up on rent seeking and why it is always (and I mean ALWAYS) bad for the market.
(Score: 1) by khallow on Wednesday November 15 2017, @02:27PM (2 children)
This is a counterexample. Scalpers bought underpriced tickets, thus in artificial surplus, well before the event, and sell them at market price later.
They exploited the actual economic inefficiency.
You still don't get why it's happening - bad market design. The key factor is dumping a bunch of tickets well before the concert. Plans aren't always made that early. Plans change. In a sensible market, one could pay more to get tickets even to the last minute.
(Score: 2) by sjames on Wednesday November 15 2017, @03:40PM (1 child)
Unless the band is taking a loss on the concert, the tickets are not underpriced. If there was a surplus, it was a natural one (more seats available than people who want to see the concert). In a perfect market, the tickets will cost not a single iota more than necessary to motivate the band to do the concert and pay the costs of it. That price will never be more than the price they freely offered the tickets at.
Inefficiencies in a market drive prices up. They're never a good thing, but they can't always be avoided.
(Score: 1) by khallow on Wednesday November 15 2017, @03:47PM
And when they freely offer those tickets.
(Score: 1) by khallow on Wednesday November 15 2017, @08:54PM (4 children)
(Score: 2) by sjames on Wednesday November 15 2017, @09:00PM (3 children)
That's just a surplus,. Nothing artificial about it (in the economic sense).
(Score: 1) by khallow on Wednesday November 15 2017, @09:09PM (2 children)
It's artificial in the same way that it is artificially scarce.
(Score: 2) by sjames on Wednesday November 15 2017, @10:18PM (1 child)
You really don't seem to grasp the concept of artificial scarcity vs. natural scarcity at all.
(Score: 1) by khallow on Thursday November 16 2017, @05:02AM
(Score: 2) by theluggage on Tuesday November 14 2017, @10:41PM (12 children)
There is a physical limit to the number of concerts a particular singer can put on. There is a limit to the size of a venue that you can reliably fill, and added value to smaller venues where the audience can see the star without binoculars. There is significant cost, and hence commercial risk, to putting on a large gig - and hence significant risk to over-charging for the tickets, not mentioning the long-term effect of having a half-empty theatre, or being perceived to be over-charging, on the star's reputation. That is real scarcity. Artificial scarcity would be only ever playing to a handful of millionaire fans...*
The scalpers are siphoning off money while producing nothing and bringing no benefit to the market and taking on very little risk - if they wreck the concert by leaving the theatre half-empty, who cares? There are other artists out there... Yes, they have to buy the tickets, but since they sell them way over the face value, so what if they don't sell them all - and that's being generous and assuming that the capital didn't come from advance fees paid by suckers who answered "make $$$ in your spare time" ads...
* Or trying to sell digital recordings at prices rooted in the days when they had to be expensively stamped out onto plastic discs in huge numbers and shipped around the world. Oh, wait...
(Score: 1) by khallow on Wednesday November 15 2017, @12:01AM (11 children)
Such as having tickets for those who didn't get them at the initial release. That is the benefit of scalpers.
I agree that there is market failure here due to the poor design of the market, but it is not solved by ignoring why scalpers exist in the first place.
(Score: 2) by Wootery on Wednesday November 15 2017, @09:32AM (8 children)
To who? All it does is replace early-buying fans by high-paying fans, with the scalpers pocketing the difference. It doesn't benefit the people behind the event itself, and it disadvantages the would-be early-buying-fan when the scalper gets in first.
(Score: 1) by khallow on Wednesday November 15 2017, @02:16PM (7 children)
Ok, so why don't you think that is a benefit? High-paying fans who made last minute plans shouldn't be allowed to go to a concert? What you're willing to pay for a ticket is a strong indication of your desire for that ticket. My working example here is airline tickets which implements a system called dynamic pricing so that people who make last minute travel plans have travel options, but they pay for that with higher ticket prices.
(Score: 2) by Wootery on Wednesday November 15 2017, @05:06PM (5 children)
It's zero-sum. I already asked you: where is the benefit in the high-paying fans being able to attend instead of early-buying (and possibly less wealthy) fans?
(Score: 1) by khallow on Wednesday November 15 2017, @08:23PM (1 child)
They get tickets for things they want. And keep in mind that this whole mess started because early-buyers have access to all the tickets.
(Score: 2) by Wootery on Wednesday November 15 2017, @09:45PM
That doesn't answer the question. Again you're ignoring that it's zero-sum. There's no reason to favour high-paying late-comers over ordinary customers.
There is no 'mess', there's just natural scarcity.
(Score: 1) by khallow on Wednesday November 15 2017, @08:37PM (2 children)
This a strong indication something is broken. The additional revenue from the people willing to pay more could either be used by the parties who are running the concert (band or venue) or given back to fellow concert goers in the form of cheaper tickets. It should not be zero-sum.
(Score: 2) by Wootery on Wednesday November 15 2017, @09:53PM (1 child)
Do you have a concrete scheme in mind?
(Score: 1) by khallow on Thursday November 16 2017, @05:05AM
Another approach is to do as the airlines do, dynamic pricing, where tickets increase in price as more are sold and the concert date approaches.
(Score: 2) by urza9814 on Wednesday November 15 2017, @05:34PM
Now that's just complete bullshit. That would only be true in a world without any significant income inequality.
Bill Gates could drop ten grand for tickets on a whim because it's Friday night and he's bored.
Someone who earns $50k/year can't do that, no matter how badly they want to go.
A better metric of how badly one wants to go is when they buy, not how much they pay. If you want the people who most want to go, look for the people that are *waiting* for that particular show, that are watching the band's website and social media pages waiting to see tour dates, who are willing to block out their calendar months in advance knowing that NOTHING could come up that's so important it would keep them from attending.
(Score: 2) by theluggage on Thursday November 16 2017, @09:39AM (1 child)
... only because the fucking scalpers got them all first!.
TFA is talking about 300 tickets bought up by just one scalper, who is unlikely to be the only one working that concert... Jeez, the self-justifying bullshit is beyond belief.
(Score: 1) by khallow on Thursday November 16 2017, @02:01PM
Scalpers came first, then the manipulation of this market.