Louis CK's Direct Tour Sales: Over $6 Million In 1 Week, Scalping Drops From 25% To Below 1%
from the not-bad dept
We recently wrote about Louis CK’s latest experiment in being open, human and awesome and connecting with his fans: selling his entire tour directly from his own site at a flat price (no service fees, nothing) of $45. One of the “features” of that offering was also an attempt to cut down on scalpers. There is at least some recognition that this means leaving money on the table and, potentially, making things a little more complicated than they might otherwise be. However, Louis seems to recognize that the benefit here is making most fans a lot happier with more reasonably priced shows.
And, so far, it all appears to be working. Louis sent an update on both ticket sales info and scalpers to Laughspin. You should go read the whole thing there, but there were a couple points worth addressing here. First off, in one week, it looks like he’s grossed over $6 million.
I’m doing 67 shows on this tour and we’ve sold 135,600 tickets to those shows after one week on sale.
The math here is easy. Every ticket is $45. That’s it. So, multiply and you get $6.1 million. Obviously, that’s gross sales, not net, and there are significant overhead costs to factor in, but still — that’s not bad.
Perhaps more interesting is the impact on scalping. The Laughspin folks noted that there still does appear to be some availability of scalped tickets (some at high prices), and Louis and his team are working hard to track down and cancel many of those tickets. But he also provided some numbers that suggest the new plan is working quite well in minimizing scalping. He can tell this, in part, because prior to setting up this tour, he had two other shows booked in a more traditional way, and he can look at how many scalped tickets are available for those shows compared to the new ones. And the differences are striking:
There are 1100 tickets available on stubhub alone for those two traditionally ticketed shows out of 4,400 available ( Almost exactly 25%)….
There are less than 500 tickets available on all scalper sites (including stubhub) out of the entire 135,600 tickets that have already been sold, from the tour sold exclusively on my site, louisck.com (substantially less than 1%)
So it’s working. So far.
That’s a pretty massive difference. Assuming this really does work, it sounds like Louis and Etix (who is handling the tickets) have a service that lots of other performers might want to start looking into.
One final interesting point: Louis talks a little about how the scalpers are reacting — saying that they defend what they do…
Contact with these scalpers has been enlightening. They tend to respond with indignance and a defensive posture “Hey man! Scalping is NOT a crime!” We’re not treating it as a crime or even a wrong-doing. We are just competing with them, on behalf of my fans, to enforce the terms and conditions of our ticket sales and to keep the prices down. It’s worth the effort, it’s working and it’s even been kind of fun.
And that is part of what makes this so awesome. He doesn’t feel the need to go legal or whine about it. He’s innovating and adapting… and beating the scalpers at their own game. And that’s how it should be done.
Filed Under: direct to fan, louis ck, open human and awesome, scalpers
Comments on “Louis CK's Direct Tour Sales: Over $6 Million In 1 Week, Scalping Drops From 25% To Below 1%”
So people are ok that terms and conditions can ban reselling tickets above their face value? Where are the complaints that they bought the ticket so they own it, like when people complain about software “licenses”?
Sure for some reason people dislike scalpers (except at the last minute when they realize they need one more ticket), and the restrictions on software licenses are generally more draconian, but there is no real difference between the two types of restrictions.
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For this reason I am very ambivalent about scalping. Artists want tickets to be affordable, but not letting me sell something I’ve purchased doesn’t rub me right either.
Once someone hits a certain level of popularity, they can’t really be expected to perform enough to keep price down, and really, is it any more noble to wait in line for hours than to work those hours and spend the money for a ticket?
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There is no waiting in line. He isn’t selling out in minutes. If you want a ticket you go buy one. Part of the problem with popular acts selling out instantly is scalpers buying tickets in large quantities the second they go on sale.
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You can resell your ticket you just can not resell it to profit.
Scalpers buy tickets you could have bought for face just to resell them at a higher value. They are not adding value, they are just getting to the tickets first knowing the act is popular enough to sell out and taking advantage of that.
If you don’t want the ticket and you bought it on accident or can no longer use it sell it at face.
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Yes they can and they do.
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Scalper’s aren’t adding value? I beg to differ.
Have you never needed another ticket last minute? Or only found out that you can go to an event after all, but only after all of the tickets are sold out? Or find out that you can’t go, and you only have one ticket but people only want to buy 2?
Scalpers add liquidity to the market for tickets, which makes it more efficient. They are most certainly adding value.
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That’s kind of too bad for you if you didn’t buy a ticket when all the paying customers got tickets before you, having to OVERPAY for a ticket at the last minute doesn’t mean scalopers are adding value, they’re just providing a ticket at a price you were willing to pay by taking it out of the price range someone ELSE was willing to pay.
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So scalpers are, in reality, good samaritans looking for people in need of good deeds. Who knew.
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Pricing out a majority of fans just so you can buy a last minute ticket isn’t really value. I bought a 45$ ticket, if scalpers had bought their normal 25% I wouldn’t be paying 500$ able to go, but I guess rich people who hear about things second hand at the last minute win.
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If the scalper hadn’t bought the ticket, it would theoretically still be available when you found out at the last minute that you could go. Or, it would have gone to someone who could go if they were able to plan in advance, but weren’t willing to show up at the door and hope for the best. So your added value comes at the expense of someone who would’ve had perfectly adequate value without the scalper.
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in Louis CK’s case, you can probably still go and watch the show at retail. This is not something you cvan do with scalpers.
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Retail stores buy products at a lower price and then resell them to you at a higher price. Investors buy stock and resell it higher. I bought some Star Wars figures on clearance when I was a kid and sold them for a huge profit years later. People purchase limited edition books/recotrds/DVDs/etc and resell them on ebay for more later. Evil! Profit!
I have never scalped a ticket, and I find the practice distasteful. On the other hand, that’s how products work in a market. Face value is arbitrary. Tickets are scarce goods that often become instant “collectibles,” albeit with a very limited lifespan. The only reason we see so many scalpers is that the face value of tickets is often far below the market value.
It’s supply and demand. If artists want affordable tickets, they’ll have to increase supply to meet demand. That means do more shows. Not a fan of Garth Brooks, but there’s a reason anyone who wanted a ticket could get one for $25 for his first appearance in years. He did shows for three weeks, continuing to book them until the sales slowed down.
Why should tickets get some special treatment that invalidates the first sale doctrine?
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“Retail stores buy products at a lower price and then resell them to you at a higher price. Investors buy stock and resell it higher.”
The ship the product around the country and store it until it is sold. This provides a service and adds value.
” I bought some Star Wars figures on clearance when I was a kid and sold them for a huge profit years later.”
You maintained an item long after it was produced. You stored it for years and kept its condition acceptable. You provided a service and a value.
Scalpers buy a large chuck of available tickets and immediately run the price up by hundreds of percents while providing no service or value. They price out fans and they profit from other peoples talent while adding nothing to the equation.
An artists time is an actual scarcity. Scalpers merely take advantage of that by developing systems and methods that help them snatch up 25% of the tickets before anyone else can and then run up the price because actual fans want to be there.
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“You maintained an item long after it was produced. You stored it for years and kept its condition acceptable. You provided a service and a value.”
So what? If I had gotten to the store to buy a limited edition that became valuable immediately, would it then become evil to sell it for a profit? If I purchased a game console on launch day, then decided a 200% profit was worth more than having the console two weeks ahead of everyone else, does that make it evil?
The fact is, the moment you throw out the first sale doctrine for one class of products, it starts down a slippery slope to eliminating it altogether. Scalpers suck, but unless artists are going to book more shows, there will always be tickets sold at a market value much higher than face value. Making it illegal will only push it to black markets, and that’s not going to help anyone.
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Who is talking about making it illegal?
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You appear to have completely missed the point. Also, nobody’s talking about making it illegal.
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“Tickets are scarce goods that often become instant “collectibles,” albeit with a very limited lifespan”
No they don’t. A ticket is not a collectable (although some can be after the event in some cases). A ticket is merely proof that you have agreed to sit in a particular seat at a show or be allowed entrance into a gig. Until the gig actually happens, the owner has not received what they paid for. After that, it’s too late and the actual value of the product purchased disappears. The value and the product being sold is the seat, not the ticket, and they have a single market value until some 3rd party speculator comes in and screws it up for both parties involved in the final show. The problem comes when said 3rd party turns what should be a direct transaction into an expensive lottery, just because they want to profit.
Is this really too hard to understand?
“If artists want affordable tickets, they’ll have to increase supply to meet demand.”
Which is impossible in a sold out show. If the theatre has a 5000 capacity and 5000 tickets have been sold for that performance, the artist cannot magically make more appear. Perhaps they can arrange new dates, but that’s not always possible and the scalping scavengers will just have another opportunity to feed, causing the same problems.
All the more reason why scalpers should not reduce availability for those who *actually* wish to attend the show instead of rip people off for a quick buck.
“Why should tickets get some special treatment that invalidates the first sale doctrine?”
Because their nature is completely different from most other consumer goods, and they’re already subject to special conditions (e.g. venue right to refuse admission even if you have a valid ticket). You’re not making any sensible claims here.
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Tickets to a show really aren’t the same as regular property. They’re good just for the showing (or multiple showings if it’s that kind of ticket) you paid for when buying it. After that, they’re worthless. This is much more akin to a license than a sale. You’re basically buying a license to be able to sit in a certain seat on a certain date to watch a certain entertainer/group.
But even if it is a sale, the restrictions are offset by the much lower price. (If you read the original article Louis CK says the $45 price is about half what his fans have been paying, even before scalping, in the past few years due to fees and markups added on.) Given that 1. the money’s going directly to the artist, 2. the prices are beyond reasonable, to being a steal and 3. people really do hate scalpers (even if you need one at the last minute you still hate the markup), people are much more willing to accept the extra restrictions.
That goes along with what Mike calls being “open, human and awesome”. Louis CK has been quite open about what the restrictions are for, and has also lowered the prices for his fans (being human), so they think it’s awesome and aren’t complaining about the resell restrictions.
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You missed 1 point.
I believe that LouisCK will buy back your ticket if you find that you can’t use it. So you don’t even have to worry about finding some other person to buy the ticket(s) you can’t use.
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You have to agree to terms and conditions at point of sale, and if you dont you don’t buy the tickets.
For software licenses, after you purchase the product you are THEN presented with the agreement to agree to to use your already purchased (and sometimes non-returnable) software.
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“So people are ok that terms and conditions can ban reselling tickets above their face value? Where are the complaints that they bought the ticket so they own it, like when people complain about software “licenses”?”
Louis CK has been very good about actually letting people know that this is the case upfront, and is not retroactively changing the rules after the product has been bought. He’s also not trying to leverage the restriction to force sales of related products, and from what others are saying here will even allow resale as long as it’s not for scalping profits.
So, no, nothing like the other situations often complained about.
“Sure for some reason people dislike scalpers”
“for some reason”? Really? Is the fact that scalpers often buy as many tickets as possible then resell them immediately for 200%+ profit not a problem to you? You don’t see why people dislike being both blocked from making the original purchase and being raped to buy the ticket at resale?
“there is no real difference between the two types of restrictions.”
They are totally different situations.
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“being raped to buy the ticket at resell”
POP goes the ticket cherry!
What about the line along “You should be able to do whatever you want with what you buy and own” and first sale rights you are usually advocating on Techdirt ?
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“What about the line along “You should be able to do whatever you want with what you buy and own” and first sale rights you are usually advocating on Techdirt ?”
Louis CK explicitly stated that people can do whatever they want with the tickets they purchase. He intends to cancel the ones that were purchased by corporate entities that have no intention of going to the show, but he’s said they have every right to try to resell them.
Also, he’s helping fans at his expense. When was the last time a media figure appeared on TechDirt to GIVE UP a potential revenue stream without a bunch of self-pity and shill-clucking?
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This is the Techdirt blind spot. All these idiotic contortions to stop scalpers are EXACTLY what game publishers (like EA) do to stop the reselling of games: first-purchaser codes, constant online access, etc. Why people can see this, I’ll never understand. It is the free market. The “price” is what the market will pay, not what people think it should be. Scalpers, just like piracy, is punishment for not understanding economics.
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” All these idiotic contortions to stop scalpers are EXACTLY what game publishers (like EA) do to stop the reselling of games: first-purchaser codes, constant online access, etc”
Only they’re not, for a multitude of reasons already explained, and many more that haven’t Perhaps you can address those mentioned already, then we can move to the others? At least move to a better analogy, you’re comparing horses and spacecraft here and pretending the same rules of the road apply.
“Scalpers, just like piracy, is punishment for not understanding economics.”
No, it’s a 3rd party inserting themselves in between the customer and the promoter, negatively affecting both of them. You seem to be wilfully blind to this point. let me guess – there’s profit to be had so who cares what the people buying/selling the product thinks, right?
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There is a big difference between an item that a reasonable purchaser expects to have value for as long as they own it versus an item that only will have value until a fixed point in time after which it will be worthless.
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Louis C.K. is not stopping people from selling the tickets for 15% of face value at a pawn shop. He is stopping a disinterested 3rd party from deliberately distorting the market by creating an artificial shortage, and thus erecting an unintended barrier to entry for the fans. All of which is done strictly for a profit, none of which is shared or returned in the form of good will or future consideration.
You say that what C.K. is doing is simply the same as EA creating first-purchaser codes, but I would submit that a scalper is akin to my ISP charging me an extra $100 to buy a $50 game from Steam.
Competing?
Maybe I’m missing something, but forcibly canceling the tickets doesn’t sound like competing to me. That sounds like the very definition of anti-competitive behavior: preventing someone from competing with you.
Re: Competing?
Terms presented before sale: You can resell the ticket at face value. Reselling for profit breaks these terms, and will result in cancellation of the ticket.
How is this anti-competitive nature? Who is he competing with? Scalpers aren’t in competition with the act…
Interesting exception to right of first sale
I find it interesting that no one is yelling and screaming (yet) about the enforcement of “terms and conditions” being very, very reminiscent of EULAs attempting to prevent resale of software or other material under copyright.
The difference is obvious, in that tickets can be enjoyed only once, and only at a particular time — not because of artificial restrictions like DRM.
Re: Interesting exception to right of first sale
He’s not hiring lawyers and shills to try to cram a warped point of view down people’s throats, which helps.
You have a right to resell the ticket, but if he catches you selling it in a certain context, he’l cancel it. And that’s all he’ll do. He won’t treat it as a crime or even a wrongdoing. He won’t sue you, and he won’t write a long screed addressed to your full name calling you a “looter.”
There will be scalped Louis CK tickets. I may even buy one myself. But they will be scalped by amateurs.
Have to agree...
Mike is being very hypocritical on this one…
Re: Have to agree...
Why he is all about cutting out middle men. That is all scalpers are, they contribute nothing but add cost to consumers.
Re: Have to agree...
Mr. Free Market approves of the these DRMed tickets. Yeah, it’s hilarious. Too bad Mike can’t be open, human, and awesome too.
Re: Re: Have to agree...
If you’re looking for the consistent theme, maybe it’s the benefit to the public at large? Resale of games and books typically means that the seller regains a portion (but not all) of what they spent on it in the first place, while someone else who’s willing to wait gets a discounted product. Yes, there are rare items that actually appreciate in value, but that’s not how it works as a rule.
With scalping, there’s no benefit to the public. It’s forcing further scarcity on top of an already scarce product, increasing costs to the public without a proportionate increase in benefits to the artists. Limiting scalping, then, benefits the public while hurting only the middle-men who have uselessly inserted themselves into the process.
Seems consistent to me.
Re: Re: Have to agree...
There’s a difference between temporal scarcity and artifical scarcity.
Re: Have to agree...and I disagree
I don’t see these as the same thing.
Now, if the publishers of these other items want to put into their terms of sale that no one will resale their product for more than retail, then yes, it would be the same and Mike would then be hypocritical, but then again, that is the very thing that the publishers are trying to fight, isn’t it?
Sounds similar to Omega
This sound a lot like Omega using copyright to stop the sale of watches in the USA that were not bought through the “official” Omega channel. I understand that in some cases people want to have total control over what they used to own.
How’s this different from the original architect writing into the contract on a house he designed that he (and his estate) get’s 0.1% of the sale price EVERY TIME IT SELLS?
We can wipe out scalpers any time we want … if nobody buys from then then they will be gone. Simple as that.
Look what happened to Arthur Anderson after Enron … nobody would use their services after it was reveled that they couldn’t be trusted. (The same should have happened to Ford when it came out they made the corporate decision to pay off the families who had members die in the exploding Pintos because it was cheaper than fixing the problem.)
The same should be true for software and games and anything … if you bought it you should be able to resell it. A willing seller and a willing buyer, right?
Re: Sounds similar to Omega
“How’s this different from the original architect writing into the contract on a house he designed that he (and his estate) get’s 0.1% of the sale price EVERY TIME IT SELLS?”
No one is adding a cost to resale?
“The same should be true for software and games and anything … if you bought it you should be able to resell it. “
But software and games are infinitely available. I can’t buy a copy of a movie and resell it at 20 times the original price because someone can just buy an official copy.
Tickets are an actual limited supply. Why should people be allowed to profit massively just from buying a ticket before someone who actually wanted to go to the show was able to?
Scalpers are the worst of the worst of middlemen. They add nothing to the process except ridiculous costs.
I have to agree with some of the above comments.
This part..
“Louis and his team are working hard to track down and cancel many of those tickets.”
..doesn’t seem quite right to me. That really isn’t competing. If the market values the price higher than the face value, I’m not sure why that justifies nullifying the first sale rights with legalese.
The rest of it is pretty innovative, if combating scalping is your goal.
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I see what you’re saying, although I always think of competition as most likely lowering prices.
But I’ve got to love that this might help some folks without a lot of disposable income from being priced out of the shows.
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Ah, but it is still competing. If they weren’t working hard to track down and cancel those tickets then they wouldn’t be making a good effort to uphold the terms promised on all of those tickets.
Of course some tickets may fall through the cracks, but the purchasers of a ticket expect that the terms on their ticket are applied to all of the tickets.
What happened to “I bought it and can do whatever I want with it”
– I think that still applies – no?
What happened to the “It’s a private business and they can do whatever they want”
– I think that still applies – no?
What happened to the “I can buy all the tickets and sell them for whatever amount I can gouge”
– Could this be the problem?
Is ticketmaster squealing like a stuck pig yet?
– will be soon
The big difference is WHEN you agree to the licensing agreement. With these tickets it’s presented at the point of sale, wheras with most software “licenses” you just buy it, and upon installation or registration of the game you have to agree to something, and if you don’t, it may not be returnable ANYWAYS.
So he’s not being hypocritical.
Also to those saying he’s being anti-competitive, it’s not anti-competitive to compete with YOURSELF, competition would be other comedic acts going on around him, that’s his competition. Competition is NOT dealing with people who only buy his tickets to resell his tickets at a higher price just to earn cash. There is no added value, there is no added availability, it is essentially just being a parasite.
That’s the difference. Louise is in fact taking a cost hit to himself in order to make the tickets available at their original price, something that can be applauded, whereas if he hadn’t, scalpers reap a large benefit while doing essentially nothing except riding in on his popularity.
He’s right, you can do anything with your ticket, don’t show up, burn it, eat it, whatever… but if you resell it for profit, he no longer sees you as a customer and just a leech/parasite/middlema, and since his terms of agreement come at the point of sale, he can reserve the right to cancel that ticket if it’s scalped.
Makes sense, and it’s not hypocritical of Mike to support such efforts.
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Does it really matter? You know that there will be terms and conditions when you buy software, so having terms and conditions on a ticket isn’t really very different.
In fact, it appears that CK my in fact be specifically limiting first sale rights, which is something Mike has railed against over and over again in other industries. Yet here he seems perfectly happy with resale being limited. That seems pretty two faced to me.
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“Does it really matter? You know that there will be terms and conditions when you buy software, so having terms and conditions on a ticket isn’t really very different.”
Of course it’s different. Apart from the fact that you usually can’t read an EULA until AFTER you’ve opened the box (at which point many retailers will refuse a refund), half the major problems discussed are *retroactive* changes to the licence. If you agree to a licence that you’re able to read upfront and then not have it change later on, there’s no complaint.
“In fact, it appears that CK my in fact be specifically limiting first sale rights, which is something Mike has railed against over and over again in other industries”
Most of the other complaints are about OWNED products. That is, the rather egregious attempts to shift products you BUY into products that are merely licensed with no ownership rights whatsoever.
This is a completely different situation. You’re not buying something to own, you’re merely buying access to a specific seat at a specific time for a few hours. Admission is already reserved, the theatre owners can refuse and restrict your admission and even cancel your ticket at any time under certain circumstances. All this move is doing is, upfront, saying “you cannot buy this ticket with the intention of making a large profit from someone who will actually use it”.
So, no, they’re nothing like the same thing, so different criticisms can apply without contradiction.
“That seems pretty two faced to me.”
Only because you really don’t seem to understand the argument.
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What?
Knowing you will have conditions (which is NOT always true) doesn’t mean anything because you don’t know what those conditions will be, as they can change from game to game, developer to developer and product to product.
Also you get a little thing you have to agree to at the POINT OF SALE which specifically says you cannot resell the tickets for a profit. This isn’t a product you just buy and own, this is a seat ticket, which is only good for use at a specific time, at a specific day, for a specific period. You do not own anything by purchasing the ticket except the ticket itself, and the agreement you sign at the point of purchase states you cannot resell the ticket for profit.
Attempting to resell the ticket for profit is inserting yourself as a middleman in a situation where Louis has specifically taken out middle men. He has no reason to care about scalpers or let them do what they want.
People not understanding what the difference is between agreements at point of sale and terms of service post-purchase and what first sale rights are.
But if it weren’t for piracy he could have made a lot more!!!
The scalping thing is pretty easy to explain, actually. The scalpers work mostly by scanning the ticket sellers and looking for upcoming shows, and use techniques developed over time to obtain tickets.
The new way of selling is a one off, and something they were unlikely to be really aiming at.
If this became the standard way to sell shows, the scalpers would adapt and you would be back in the same place.
Once again, you are attempting to draw a conclusion and get all excited about results where the data set is just way too small.
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But since the terms preclude selling at a profit, and they are actively canceling those tickets, the scalpers would have to, I dunno, lose money? Kind of what they’re doing, right now, since their investment is being erased.
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He refunds the tickets he cancels, he isn’t stealing their money.
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Well, that’s a variant of “this will only work for him” or “it won’t scale”…
The point is when this becomes standard then the innovative people will come up with something new. That’s how it works!
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No, it’s not a variant of that. It’s a “first mover” deal, a unique situation that scalpers aren’t really set up to work with. If more acts did this, the scalpers would learn how to work it and would take advantage of it.
You can never judge the long term effects of a new sales method by a single situation. The article seems to be drawing a conclusion where none is possible to be drawn.
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So we just ignore all data from people acting outside the norm?
He guys don’t bother curing cancer, if you manage to cure somebody it probably won’t work for everyone so lets not even bother or share research.
I don’t get how scalpers are competition. Who are they competing with? It’s like someone buying up all the bottled water during a drought and selling it at a giant mark-up. It’s not competition, it’s creating a scarcity on top of a scarcity and charging the consumer through the nose for it.
As others mentioned, there’s nothing wrong with a license agreement as long as you are fully aware of the terms at the time of purchase. It’s not like these people are getting the tickets home, opening them up and saying oh shit, I can’t resell these and now I can’t return them because I disagree with the terms because I opened them!
A question for those claiming scalpers are providing a valuable service here:
So it’s looking like those that are defending scalpers are phrasing the defenses along the lines of them providing a way to get tickets for when a show would otherwise be sold out.
Offhand this argument seems to be completely absurd, since if the scalpers hadn’t scooped up the tickets themselves, solely for markup and resell, then people could have bought the tickets from the original seller anyway, at the original price.
So what, exactly, are they actually adding to this transaction other than an increased price?
I’ll admit I don’t really know anything about the whole system, so if I’m missing something, please point it out, but at the moment at least the argument being presented in their defense seems to be total bunk.
Re: A question for those claiming scalpers are providing a valuable service here:
The people staging the events generally want them to sell out. The events will take place months after the tickets first go on sale and the stagers will want to have recouped their costs as soon as possible. Scalpers are absorbing that time risk themselves.
Scalpers also provide a good pricing indicator. If tickets are priced too high scalpers won’t buy them (and likely neither will fans). If they’re priced too low then scalpers will be making huge margins.
A good article on this is: http://mises.org/daily/3888.
Personally, I believe more experiments need to be made with ticket auctioning. For example, if a ticket reseller (scalper) were allowed to bulk buy tickets (thereby absorbing the risk) and then auction them all at once (in Kickstarter stylus manner).
It is important to note that the scalper in the above example is a risk absorbing middle man. If the artist is willing to take on the risk then that middle man can be bypassed.
Indeed, this is another area where labels can have a future.
Re: Re: A question for those claiming scalpers are providing a valuable service here:
The tickets did sell out.
Very quickly.
If the show is so bad they won’t buy the tickets, then scalpers do not provide anything to anyone.
If the show is going to do so successful that the tickets can be priced higher and people will still go.. the scalpers are still doing nothing for anyone except artificially increasing the price. Scalpers are middle men who have inserted themselves in such a fashion that almost nobody actually wants them.
In this specific case, Louis WANTS his ticket prices to be low, that’s part of why he’s doing this whole thing, and a famous act is going to sell out ANYWAYS. Scalpers add nothing to the artist, they add nothing to the people staging the events… they just increase the cost and move it out of the original price bracket and into a higher one.
Re: Re: Re: A question for those claiming scalpers are providing a valuable service here:
> except artificially increasing the price
The price is an agreement between buyer and seller. If you raise the price too high, the buyer won’t buy.
The problem is there are buyers, like me, who have more money than time. I don’t want to wait in line or on the phone to get a ticket, or plan months in advance. I want to look at what is playing in the next few weeks and then buy a ticket. I don’t really care about the price. If it is too high, I won’t go.
Scalpers take a risk because they buy tickets that may not sell. Scalpers add a service because they are good for people like me who can afford their prices.
Scalpers could be eliminated TOMORROW if all tickets were auctioned off. Sorry if that means that a few poor fans don’t get to see the show. Welcome to economics 101, where scarce resources are distributed on price, not how fast you can hit the re-dial button. But then Louis would make way more money and we won’t care that you pirated his DVD.
Re: Re: Re:2 A question for those claiming scalpers are providing a valuable service here:
I am sure they are glad people like you are willing to give 450$ to a scalper while giving 45$ to the artist.
This isn’t the 90s you don’t have to wait in line or re-dial anything. Everyone has an equal chance to get a ticket, except of course you because you make more money than you need apparently. But I am glad you excess money gives you the privilege not actually having to try to to get tickets to something other people want to see but can’t afford after a 900% mark-up.
“Scalpers could be eliminated TOMORROW if all tickets were auctioned off”
So you don’t want to have to be aware of when tickets go on sale and like scalpers because it gives you an unfair advantage because of your wealth but you would be happy to have to sign up in time to get in the auction drawing which would probably be held well in advance of the show? Or do you just know someone will still sell you a ticket for gigantic profit?
Re: Re: Re:3 A question for those claiming scalpers are providing a valuable service here:
> 450$ to a scalper while giving 45$ to the artist.
I want to give $450 to the artist but people like you make it difficult for me.
> you don’t have to wait in line or re-dial
I’m pretty sure tickets are sold the same way now, first come first served. This may be more fair to the poor consumer, but is not fair to the rich consumer, or the seller.
> you make more money than you need apparently
Time=money. When I was a poor student, I had more time than money, so I waited in line. Now my time is more valuable, and therefore I make economic decisions based on that. Have you ever paid some neighborhood kid to mow your lawn? Do you have more money than you need?
> excess money gives you the privilege
Damn right. I work hard for my money and I should be able to do with it what I want. If you want scarce consumer resources to be distributed based on something other than price, don’t live in a capitalist society, or don’t complain.
> have to sign up in time to get in the auction
The auctions could be staggered, some early, and some closer to the show. The seats closer to the show date would be more expensive to account for people like me (unless not all the seats were sold, then they would be cheaper).
Re: Re: A question for those claiming scalpers are providing a valuable service here:
“Scalpers also provide a good pricing indicator. If tickets are priced too high scalpers won’t buy them (and likely neither will fans).”
Hilarious. So if it’s too expensive for scalpers to sell marked up no one will buy them. but if the scalpers are the ones who marked them up they sell like hotcakes?
“(thereby absorbing the risk)”
There is no fucking risk. Louie will sell out, a Bon Jovi concert will sell out major fucking acts sell out just fine without someone stepping in and marking tickets up 500%
” If the artist is willing to take on the risk then that middle man can be bypassed.”
?? How the fuck does that happen? Artists don’t get to say, no thanks scalpers we would like our tickets to sell at face value and the scalpers go away. Scalpers buy tickets to acts that are almost guaranteed to sell out and then just mark that shit up.
Re: Re: Re: A question for those claiming scalpers are providing a valuable service here:
There is more that one type of risk. In cases where shows are all but guaranteed to sell out, the unknown factor is time. In most cases the stagers will want to sell out straight away. That way they have the money, they have their profit and the money required to stage the show. All months before the show will take place. As far as the stagers are concerned that is a good deal.
Time is also the factor for the people buying the tickets. They might not have enough time to queue/wait on the phone/sit hitting reload to buy the tickets from the official seller. They might not know at release if they’ll be able to attend a show in six months. These people a willing to pay a premium to buy their tickets later.
The stagers don’t want to have to deal with people who buy tickets on release but then find they cannot attend the event – it represents an extra cost. Scalpers also pay a role here, they’ll buy those tickets (or those people will become “scalper” themselves).
I would like to note that I am note arguing against what Loius CK is doing. I am arguing against the position that scalpers (resellers) have no role to play.
Re: Re: Re:2 A question for those claiming scalpers are providing a valuable service here:
As has been already pointed out, they won’t buy tickets to shows that won’t sell, meaning they provide no benefit.
And to big ticket acts that ARE going to sell out, that’s when they bring mark ups.
When the people staging the show receive the money actually matters very little, as if something is guaranteed to sell out, it doesn’t matter if it happens now or later, especially with a limited good like ticket sales.
And again, willing to pay a premium doesn’t mean anyone is obligated to have tickets available for that person. That’s irrelevant to everything, as the only way for tickets in a sold out show to be available to them is by specifically denying those who cannot afford the premium, but would have gone to the show anyways.
Also being willing to pay a premium does not benefit the stage producers or the comedian or anything else who has the actual costs of production associated with them, only the scalper.
Additionally you are allowed to resell tickets in this situation, just not for profit. Scalpers specifically refer to people who buy them out in order to resell them for profits, not to those who have plans come up and have to get rid of their tickets and thus give or sell them at cost.
No, you can’t argue semantics, it’s the initial intent of buying the ticket that matters, not attempting to justify behaviors.
Re: Re: Re:3 A question for those claiming scalpers are providing a valuable service here:
“When the people staging the show receive the money actually matters very little, as if something is guaranteed to sell out, it doesn’t matter if it happens now or later, especially with a limited good like ticket sales.”
Really? If they’re paying for staging the show with the ticket sales I’d say it matters a great deal when they get the money.
Re: Re: Re:4 A question for those claiming scalpers are providing a valuable service here:
Stages usually have a fixed costs, they aren’t building huge sets for any person who comes on by.
If they are REQUIRED to sell out the show to fund the show, that’s a different problem, but businesses also tend to have things like lines of credit.
Additionally, their non-fixed expenses won’t be incurred until after the show, so it doesn’t matter WHEN they sell out if they are going to sell out.
Louis, with his popular act, has sold out in no time at his ticket prices, scalpers are literally providing absolutely nothing in this scenario and the same can be applied to many others.
Scalpers do not ABSORB risk unless they KNOW they will turn a profit, this is why they are parasites, they do not buy unused tickets, they buy tickets that would have gone to someone else had they been available from the original retailer.
I’ve only been reading this blog for a few weeks now (can’t believe it took me this long to find! Great site!) but I think some of you are really missing the point. Yeah, here at TechDirt they often rally behind First Sale Doctrine for software and other DRM- and EULA-‘protected’ items. But do you know what else they do?
They point out, time and time again, over and over, that *different markets need to be treated differently*. Patents make sense in some markets in some situations, but applying them to things like genes and software is completely backwards. Likewise, first sale doctrine doesn’t actually help the consumer at ALL in the case of an item with strict temporal scarcity, like a concert ticket.
Anyone claiming that TechDirt is hypocritical or what-have-you over this is completely missing the point. “But-but-but….you said that APPLES were the best fruit for making pies….why are you telling me to make this fruit salad with ORANGES?”
“Retail stores buy products at a lower price and then resell them to you at a higher price. Investors buy stock and resell it higher. I bought some Star Wars figures on clearance when I was a kid and sold them for a huge profit years later. People purchase limited edition books/recotrds/DVDs/etc and resell them on ebay for more later. Evil! Profit!”
Retail stores also don’t sell items with strict temporal scarcity.
“Why should tickets get some special treatment that invalidates the first sale doctrine?”
Because a ticket, unlike a piece of software (despite what software publishers will tell you), actually IS a license: a license to sit your butt down in a certain seat at a certain time. It’s not a regular commodity and it is nothing short of willful ignorance to believe otherwise.
Are scalpers providing a service?
Here’s a very simple test to tell if scalper are providing a service: if people buy from them then they ARE providing a service.
Same goes for any service, legal or illegal, if there’s a market someone will provide it.
So the only question is, should it be legal. Think of prostitution or pay-day loans or political super PAC.
So if I show up to one of Louis CK shows with a ticket and they say I can’t come in, I think that I have been harmed (is tort the right word?) and have the right to a refund plus damages.
Of course for $45 even small clams court is too expensive to make it worth the effort.
Just my opinion.
Re: Are scalpers providing a service?
” if people buy from them then they ARE providing a service.”
Not really people would have bought the ticket from the venue/artist/vendor if the scalper hadn’t bought it first. They would have bought it at a much lower price too. Where is the service?
Re: Re: Are scalpers providing a service?
We had tickets to a show that is now sold out. Some friends came in from out of town that day. The choice was to not go, go without our friends or buy in front of the venue from a scalper.
We bought two tickets from a scalper in front of the venue for 15% above face value and were glad for the service they provided.
Re: Re: Re: Are scalpers providing a service?
There is a fine line between selling at the venue for 15% mark-up and selling months in advance at 9 times face.
That guy in your example might have just had an extra ticket.
There are also the guys that go around buying extra tickets from people before they walk in and then trying to flip them. I see the service and risk there.
Louie tracking down and canceling tickets being sold online will probably do nothing to stop people from standing outside the show.
It is a hard line to draw.
Re: Re: Re: Are scalpers providing a service?
That misses the point. If a scalper were to stand out in front of a venue and buy back extra tickets from fans who for some reason can no longer attend, and then resell the tickets to folks such as yourself who happen to need an extra pair, then fine. That might be something that could be considered a service. However, that is NOT what they do. If the scalpers had not bought out the show, then you could have simply scored from the box office and saved the extra 15%.
Re: Re: Re:2 Are scalpers providing a service?
rats, AC beat me to it.
Re: Re: Re:2 Are scalpers providing a service?
I think I do see the point. I’m just sad to see the “first sale” principal being attenuated by everyone.
Why not just limit sales to the box office an hour before the show? (Yes, I know that causes other problems too.)
Again, don’t like scalpers … don’t buy from them. Don’t like prostitutes, don’t buy from them. Don’t like pay-day loans, don’t buy from them.
To me it is simple.
Re: Re: Re:3 Are scalpers providing a service?
“Again, don’t like scalpers … don’t buy from them. Don’t like prostitutes, don’t buy from them. Don’t like pay-day loans, don’t buy from them.
To me it is simple.”
On a personal level I agree and I don’t buy from them. Unfortunately ignoring problems doesn’t make them go away. I don’t buy from terrorists or crack dealers but they are still out in the world causing problems. Scalpers are not the bane of my existence and don’t take up much of my thought, on most days, I have missed a few shows and more than a couple sporting events because they price me out, oh well life goes on. But if artists see them as milking their fans for money they don’t earn and want to take steps to fight them, I am 100% behind them.
Cheers and happy friday
Re: Re: Re:3 Are scalpers providing a service?
“Again, don’t like scalpers … don’t buy from them.”
OK, I don’t. However, when I go to the website to buy tickets, they’ve already been bought by scalpers who have no intention of attending the show. Now, if I want to go to the show I’m forced to pay whatever markup the scalpers want to charge just to get the ticket I was trying to buy at the normal price.
This isn’t a problem to you?
Re: Re: Re: Are scalpers providing a service?
Good for you.
Now, when those scalpers obtained the tickets, did they block other people from buying the tickets at their original price by doing so, just so they could make a quick buck off people who didn’t bother? If so, hopefully you see the problem.
“You say that what C.K. is doing is simply the same as EA creating first-purchaser codes, but I would submit that a scalper is akin to my ISP charging me an extra $100 to buy a $50 game from Steam.”
Close – it’s more like your ISP charging you an extra $100 to buy a $50 game from Steam because (for whatever reason) it was a release limited to X number of downloads, and it was currently unavailable because your ISP decided to buy 50% of those X downloads to resell for pure profit. They never intended to use the product, they are creating artificial scarcity on top of the scarcity inherent in an item like a ticket to turn a profit without adding value.
Adding Value
“they are creating artificial scarcity on top of the scarcity inherent in an item like a ticket to turn a profit without adding value.”
I have a distaste for ‘scalpers’ … I don’t like feeling like I paid more than I had to for, well anything. Like ‘gouging’ we feel ripped off.
I disagree that the scalper is not adding value. If they were not adding any additional value they would never sell tickets for more than face value.
Should we encourage or eliminate this behavior is an entirely different question.
The simple fact is that people will value the same ticket at different incremental prices. Maybe they love the band, have a high income, or are buying a present for their significant other. The fact that they are willing to pay X(face value)+ Y (scalper markup) for a ticket demonstrates that they find that transaction worth while. It is clearly ‘worth it’ to the person making the purchase.
There is no guarantee that tickets would be available had ‘scalpers’ not bought up large blocks of tickets. As another commenter added, they add liquidity to the market. They’re taking a risk that they can sell enough tickets at a higher price to cover the cost of their initial investment.
I agree that scalping is annoying and I don’t like feeling cheated either. However to say that they don’t add value is missing the point. They don’t add value *to you* … which is different. They guarantee tickets are available right up to when the show begins, which some people find very valuable.
But again, if this is a practice we should encourage or eliminate is an entirely different question.
Some people seem to be arguing because the tickets can be priced higher, they SHOULD be priced higher.
Have you never heard that just because something can be done, doesn’t mean it should?
Scalpers provide no services, any attempt to say otherwise is silly. Just because someone can get a ticket off a scalper at the last minute does NOT mean they provide a service, it just means it was out of the price range of the people who wanted it earlier, and occasional anecdotes about “hey I got a ticket for a good price at the last minute!” doesn’t actually apply.
Also to the person comparing ticket sales to retail… you know nothing at all about supply chains, wholesalers or middle men.
Also auctioning off tickets, while it could work, anyone who knows anything knows that people getting different prices for the same object have reacted VERY negatively to such things. It’s not a new idea and it’s been attempted, and for any good that has many many copies of it, many don’t like it. Incremental pricing is something that is generally not well received, auctioning a mass good or license has not been well received as well, especially when offered by a retailer of some kind as opposed to just an auction site.
So no countering with saying “but people do that on EBAY!”
Louis ck
I purchased two tickets at stubhub and received them to download. When I get to the show are they going to let me in ? I have to drive three hours and it would suck if I don’t get in. ? Anyone have any answers ? My ticket says 45 on it , and I haven’t gotten a refund
Louis ck
What happened? I’m in the same situation but honestly didn’t know. I bought these as a gift for someone. Were you turned away at the door?