When scalping goes digital

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Online shoppers for tickets to the Rochester Broadway Theater League’s 2019 presentation of “Hamilton” could be in for some sticker shock.

Clicking on the first result in a Google search for “Hamilton” tickets here yields an offer for loge seats at $2,200 apiece. Another online seller offers a row K orchestra section seat for $4,344.

A bit pricey, you say? RBTL executive vice president Linda Glosser says so too.

RBTL’s top price for tickets to its April 23 to May 12 run of the wildly popular rap musical so far has only been determined for season ticketholders during the show’s opening week. It is $189. Tickets for later Rochester “Hamilton” shows are not yet priced and probably will not be priced or go on sale to non-season ticket holders for a while, Glosser says.

RBTL has not yet received word from the show’s producer on prices for non-season ticket holders. Those tickets are not likely to be available until next year, she adds. Prices are set by the show’s producer, not by venues like RBTL that stage productions. Glosser says she does not expect to learn prices RBTL can charge for “Hamilton” tickets until shortly before the show is staged.

Top price “Hamilton” tickets at another upstate venue that began staging the show in November top out in the $300 range, Glosser says. She believes RBTL’s tickets will be similarly priced. But as in the case of the other venue, which learned its “Hamilton” tickets’ pricing only about a month before the show was slated to run, she does not expect the show’s producer to inform RBTL of pricing any time soon.

Asked how the vendors offering $2,200 or $4,344 “Hamilton” seats might have acquired Auditorium Theatre tickets, Glosser says she has no idea. She thinks it’s very unlikely that any of the three vendors I investigated—or any of a number of similar vendors offering “Hamilton” tickets—actually have tickets in hand.

So-called speculative sales have grown in the digital age, with scalpers using bots to automatically buy up blocs of tickets seconds after they go on sale, immediately freezing retail purchasers out of the market. That practice has been banned in New York. Even so, digital transactions by secondary sellers is a factor driving up prices.

The $2,200 offer for “Hamilton” tickets here comes from a company called Event Tickets Center, a Florida-based firm that also offers tickets to sporting events, concerts and other events at numerous venues in all 50 states. If you think $2,200 is too dear, ETC will sell you seats in row V of the Auditorium Theatre’s Balcony for $853 apiece. That’s for a Tuesday night “Hamilton” show in April. Seats in the orchestra for a Wednesday night show in May can be had for $803 each.

The seller of the $4,344 ticket, Ticketoffices.com, also is offering cheaper “Hamilton” tickets including orchestra section seats for a May 1 Auditorium Theatre show at $1,039 per seat. More economy-minded patrons can buy seats in the balcony’s lower and upper reaches for prices ranging from $456 to $870. Similarly, Vividseats.com offers tickets to RBTL’s “Hamilton” shows for prices ranging from $470 to more than $1,000.

Not only has RBTL yet to offer or even price “Hamilton” tickets, but in a move to combat ticket scalping, the show’s producer has taken steps to keep the popular show’s tickets off the market.

In a first for the local theater group, RBTL left “Hamilton” tickets out of the advance-ticket packets mailed to season ticket holders in September. A cover letter informed patrons that the move was made to prevent scalping and that “Hamilton” tickets would be mailed to them before the show begins its April 2019 Rochester run. Glosser says the move was ordered by the show’s producer.

Ticket scalpers obtain tickets to popular shows, concerts and events solely for the purpose of reselling them at a markup. To make the business model pay, scalpers need to obtain as many tickets as possible, preferably scoring an amount sufficient to turn the tickets into a scarce or otherwise unobtainable commodity.

Digital-age scalping

In the pre-internet world, scalpers paid confederates, sometimes enlisting children or down-and-out job seekers to stand in box office lines and buy multiple tickets to popular shows, concerts or sporting events. Scalpers would hawk tickets on the street, often stationing themselves near venues on show nights.

Scalpers no longer need to wave tickets in patrons’ faces on show nights. They can sell more easily where most theater patrons buy tickets: online.

With the advent of online sales, big national companies that run software platforms for making and keeping track of online ticket sales have largely taken over the ticket-selling function from local venues large and small including RBTL. Online purchasers pay a “convenience fee,” an amount tacked on to the ticket’s face value price, for the privilege of buying online.

Ticketmaster handles all of RBTL’s ticket sales, Glosser says. Advance ticket purchasers can avoid a convenience fee by buying at the Auditorium Theatre box office, but most patrons buy online.

With 80 percent of the U.S. online box office market, Ticketmaster is the industry giant. A smaller competitor, StubHub, handles most of the remaining 20 percent.

Ticketmaster currently is not offering tickets for RBTL’s “Hamilton” run. In late October, it was offering tickets for an early November Saturday night performance at the Richard Rogers Theater in New York City for prices ranging from $618 to $2,074.

Glosser is convinced most patrons do not realize that tickets purchased through Ticketmaster or StubHub are not directly sold by venues like RBTL. She also believes few patrons distinguish between primary sellers like Ticketmaster, that act as a venue’s agent, and secondary sellers like ETC that buy tickets to resell and offer at a markup.

For most modern theater patrons, a Google search for a particular performance or venue is step one. A telltale for ticket seekers should be that the search engine identifies ETC and other secondary-market ticket merchants as paid advertisers who shell out monthly fees to Google for the privilege of booting venues like RBTL out of the first place in line. Glosser says most purchasers don’t pick up on that clue, but simply click on the first result and assume they are dealing with the venue or an authorized agent like Ticketmaster.

The blurring of lines between box office sales and primary and secondary sellers’ online offerings has made life easier for would-be scalpers, Glosser says. Even the least-savvy theater patron would be likely to discern that a man waving tickets outside a box office line might be a scalper. The top result in a Google search far less obvious.

A tighter New York law

Secondary ticket sales are not illegal in New York, but they are regulated. The line between legitimate secondary sales and scalping may not always be clear to theater patrons, however.

Last June, New York amended its ticket-scalping statute to include speculative sales, offers by secondary sellers of tickets the sellers have not yet acquired.

The state’s anti-scalping law make sellers convicted of using bots eligible for jail time. Secondary sellers must be licensed and post a bond. The new provision says secondary sellers can make online ticket offers only if they have tickets in their possession or have a contract to buy tickets.

There is a loophole: Speculative sales are allowed if the seller clearly states in writing that it does not yet have a ticket or a contract to buy one, and agrees to refund the buyer’s money within 10 days of its failure to provide a ticket.

The secondary sellers I investigated each posted notices revealing they are not primary sellers and might be selling tickets at more than face value. Those disclaimers were not posted prominently, however, and none stated that the sellers did not actually have “Hamilton” tickets in their possession.

To the contrary, each posted interactive Auditorium Theatre seating charts that appeared to let purchasers choose specific seats on specific performance dates. Observant buyers might infer from statements like a guarantee posted on Ticketoffices.com’s website that the seller does not have in hand the tickets it is offering.

Touted as a “100 percent guarantee,” it promises to “get you your tickets no less than one hour before your event’s start time.” The guarantee hedges the promise, adding that “in the event that we are unable to send you the exact tickets you ordered, we will provide you with tickets for equivalent or better seating.”

Still, the guarantee—reached only by clicking on a link a purchaser might or might not open—would seem to fall far short of what the New York statute demands: a clearly stated disclaimer and proof that the buyer has read that disclaimer.

In the first enforcement of the new amendment, state Attorney General Barbara Underwood sued Ticket Galaxy, a Connecticut online secondary ticket seller. In the mid-September civil action, she accused the firm of “a massive scheme to trick tens of thousands of unsuspecting consumers into buying tickets to concerts, shows, and other live events that the sellers did not actually have.”

Tickets were sold to unsuspecting purchasers for “hugely inflated prices,” Underwood stated in a Sept. 20 press release.

The vendor’s alleged scheme consists of the secondary seller offering tickets it neither possesses nor has arranged to buy. If the company cannot obtain tickets for shows or concerts it has pre-sold, it refunds patrons’ money but takes pains to conceal the fact that at the time it offered tickets online it did not actually have them in hand. To the contrary, the organization claimed that “selling, attempting to sell, or advertising speculative tickets is strictly prohibited by our website,” the court complaint states.

Filed Sept. 14 in state Supreme Court in Manhattan, the action seeks reparations for allegedly overcharged theater attendees and concert goers. It estimates that New York consumers were bilked out $54 million; when ticket purchasers in other states are added, the alleged overcharges total $91 million.

I reached out to ETC CEO Adam Young and Vividseats.com public relations director Jake DiGregorio, respectively, asking in a LinkedIn message and a voicemail whether their firms actually have tickets for RBTL’s upcoming “Hamilton” run.  Neither responded.

A Ticketoffices.com sales agent identifying herself only as Gina claimed the company had possession of “Hamilton” tickets but could not explain how it had acquired them despite RBTL’s and the show’s producer’s efforts to keep them off the market. She said she could not connect with a supervisor or company officer.

Certain-sellout shows like “Hamilton” bring scalping into sharp relief, but the practice is hardly limited to smash hits, Glosser says. During her 30-year tenure, problems have surfaced with virtually every show. Some patrons have shown up only to learn that the ticket an online seller said would be waiting at the box office did not exist.

“We provide them with documentation so that they can get their money back from their credit card company and we’ll try to see if there are seats available,” Glosser says.

If replacement seats can be found, patrons have to pay for them, a wrinkle that she imagines does not sit well with some.

Others have valid tickets but learn only at curtain time how much they have overpaid.

Informing such patrons is not Glosser’s favorite task.

“It’s heartbreaking to have people show up and have to tell them how much their ticket usually sells for,” she says.

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