Leadership / 04.15.19
Imposing Fines on Ticket Sellers Isn’t the Answer – It’s Collaboration
There is a new law up for approval in British Columbia — Bill 27, Ticket Sales Act — which will force primary and secondary ticket sellers to guarantee refunds on ticket sales.
Read that again.
Yes, under this bill, ticket sellers would need to refund customers in the case of event cancellations or counterfeit tickets. With the Federal Trade Commission’s upcoming workshop examining online event ticket sales taking place in June, there seems to be an increased focus on making ticketing for live events more secure for the fans. But is a law like the Ticket Sales Act the way to go about that?
Rami Essaid, Co-Founder and Chairman of Distil Networks, a ranking leader in bot management, has some thoughts on this bill, as well as the overall law state of event ticketing.
“My initial reaction is that it’s conflating who the bad actor is,” Essaid said. “It seems to prohibit the use of bots to buy tickets, but it holds the primary ticket seller responsible for it if somebody else buys that ticket and resells it for more. It puts the onus of responsibility on the platforms and the sellers and doesn’t really do much to circumvent the people that are actually doing the scalping.”
Essaid says there is so much upheaval and concern around scalpers and inflated ticket pricing that it’s causing hasty legislation to be drafted.
“I’ve seen legislation passed in more than a half dozen countries in the past year, and those laws haven’t done enough,” Essaid said. “There’s a lot of consumer angst around this problem, and legislatures are kind of at a loss to how to solve for it. The consumer wants the problem solved, so I could actually see something like Bill 27 passing.”
When asked if ticket sellers are doing as much as they can to solve the problems scalpers and bots present, Essaid said he has seen diligent effort.
“Ticket sellers are trying very hard,” Essaid said earnestly. “There’s a lot of money behind trying to circumvent the problem. As it stands right now, maybe there are some ticketing sites that need more incentive, but most of them don’t. Most of them want to solve the problem, and I think you can incentivize them with a lot lower burden than this bill would impose. This is way too costly, in my opinion. The problem is not 100 percent solvable right now, and opening ticket sellers up to this kind of liability is really harsh. There’s clearly a misunderstanding on the part of legislatures or consumers who think that this is solely on the shoulders of ticket sellers.”
Although harsh, is there a possibility that this bill could work? Essaid doesn’t think so.
“The financial burdens imposed on the ticket sellers through bills like this are then going to be passed on to venues, and so the cost of doing business is going to increase. Then, the ticket prices will also probably be increased to offset that cost. So, this will all trickle down to the consumer, and it won’t end up working anyway.”
Presumably, the thought process behind Bill 27 is that it would incentivize ticket sellers to work even harder at solving the problems of bots and scalpers. Essaid, however, believes there is already enough incentive.
“There’s a huge consumer demand for safer ticket purchasing,” he said. “There’s demand being put out by the artists and the venues. Platforms are getting it from every angle: ‘We expect you to stop bot traffic. We expect you to solve this problem.’ Their clients — who are paying them a fee to sell tickets on their behalf — are already demanding this of the platforms. The incentive is already there.”
But are the ticket sellers doing all that they can to solve the problem?
“Right now, we’re putting at least 60–70 percent of the potential momentum behind us,” Essaid said. “So, I think there is maybe an opportunity to go maybe 30 percent faster in solving this problem.”
If laws like Bill 27 won’t activate that 30 percent, what will?
“The answer comes in from collaboration,” Essaid said. “What’s going on right now is that the venue isn’t necessarily working with the primary sales site, which isn’t working with the secondary sales site. There’s not that ecosystem that is working together to solve the problem. They’re all working individually in siloes to solve the problem. Without the collaboration from end to end, we just can’t go as fast. Being able to track the transaction of a ticket from beginning to end really matters here. Collaboration between primary and secondary sites is crucial in solving this problem.”
In June, the U.S. Federal Trade Commission will hold a workshop on improving live event ticketing. Essaid sees this as important for sharing all the correct, pertinent information.
“The FTC workshop is designed to bring together everyone to talk about the problem — to talk about what’s being done to address the problem and to get a better handle on potential solutions or suggestions. Legislators just don’t understand exactly how the problem is playing out and have realized that the previous legislation hasn’t solved the consumer issues that exist today. They don’t know where to start in chasing the bad guys down. They’re trying to piece this information together and, in reality, they need to construct a way to aggregate information from primary and secondary sites in a better fashion. This workshop is proof that legislators haven’t gotten it right yet, and laws like Bill 27 will only introduce costs and impose burdens that will eventually get passed on to the consumer. And they still won’t solve the problem.”
Essaid is, in fact, optimistic about the FTC workshop. It might just provide the clarity that seems to be so desperately needed between ticket sellers, consumers and legislators.
“Lawyers have reached out to us and asked us about thoughts and ideas, so I have seen them trying to talk through this and figure it out,” Essaid said. “And that’s why this FTC workshop has been set up.”
Perhaps some clarity and productive next steps can be gleaned from the panel discussion. The FTC workshop will be taking place on June 11, 2019.
You May Also Like
Want news like this delivered to your inbox weekly? Subscribe to the Access Weekly newsletter, your ticket to industry excellence.
Tags: Reselling , Regulations , Secondary Ticketing