eBay weighs in on ticket onselling review

Online auction giant responds to Commonwealth Consumer Affairs Advisory Council issues paper on ticket scalping

eBay Australia has confirmed it will make a formal submission to the Federal Government regarding its current investigation into ticket onselling – commonly known as scalping — and its impact on consumers.

The company told Computerworld Australia that it would provide Commonwealth Consumer Affairs Advisory Council (CCAAC) with comment on a number of issues raised in its Ticket Scalping: Ticket onselling and consumers report.

According to the paper, ticket onselling was believed to have a potentially adverse impact on consumers, including dissatisfaction as well as financial and non-financial detriment.

“Ticket onselling may erode consumer satisfaction and confidence for a variety of reasons that include fair access to tickets, transparency of ticket distribution and other concerns like being pestered by unauthorised onsellers outside event venues,” the report reads. “Consumers may incur a detriment by purchasing on-sold tickets that are worthless, non-authentic or non-transferable."

Ticket onselling also had the potential to negatively affect the original ticket supplier through revenue being diverted away from performers, promoters and vendors, towards onsellers.

“The windfall returns from the onselling of tickets are flowing beyond those who bear the risk with organising and participating in the event,” the paper reads. “Inflated prices which are due to onselling can price some fans out of the market. This can result in poor publicity as fans feel discontent with the promoters because they have to pay inflated prices for tickets.”

eBay Australia spokesperson, Daniel Feiler, defended the company’s facilitation of ticket onselling, arguing that it maintained a straight forward response to the practice.

“eBay’s role is to provide buyers and sellers with a market place with has information and systems so they can both make sensible decisions and operate with an appropriate level of protection,” he said.

“We don’t see any real need for legislation. There is existing legislation in Victoria and Queensland around very specific [sporting] events, but we believe that doesn’t really get to the core of the matter. We have always argued that by ensuring that tickets get to fans in the first place… that that is the best way to minimise the issue.”

The issues paper also noted this issue, pointing the finger at promoters and performers for their role in the driving the ticket onselling marketplace.

“For promoters, charging lower ticket prices to ensure a certain level of revenue is traded off against potentially higher revenue but with the associated increased risk of not being able to sell out events,” the paper reads.

“Two major incentives for charging below market clearing prices include encouraging a sell-out to generate publicity and media coverage, and to fill stadiums as a validation of the worth of attendance and to add to the ambience."

In May last year, Gary Van Egmond, promoter of the AC/DC Black Ice Australian tour, told Computerworld Australia that there was little that promoters could do to manage ticket scalping once tickets had gone on sale.

“I’m in the business of selling tickets and eBay is in the business of helping scalpers sell tickets,” he said. “Big Day Out had an enormous legal battle with [eBay] over the reselling of their tickets and [Big Day Out] lost, so it shows it is really beyond our control. I don’t know what we can do.”

At the time, Van Egmond also disputed the idea that ticket sales should be limited, or staggered over a longer period of time, to allow fans rather than scalpers access them.

“Ticket selling is our bread and butter – you can’t expect us to limit ticket sales,” he said. “eBay should not take the [ticket] ads. If eBay closes down, then that would help.”

eBay’s Feiler added that the company did not believe ticket onselling had an adverse impact on consumers, and could actually benefit them by giving access to tickets which would otherwise be unavailable.

"[Onselling] helps people in regional areas who have slow connections, or people who can’t spend the time waiting on the phone to get through,” he said. “How many times have we seen thousands and thousands of tickets get dumped on to the market in one day and have their [online selling] systems go down.”

In May 2009, the volume of tickets on sale combined with consumer demand for AC/DC’s Australian concert series saw Ticketek’s online sales site become unusable for many punters.

However, Ticketek's chief operating officer, Fiona Boyd, recently assured that the ticket sales company provided enough server capacity to ensure a rush of sales on popular concerts would not topple the site.

According to eBay's report, onselling did have a number of potential upsides including allowing consumers willing to pay a premium to attend a sold-out event, and benefiting event organisers and ticket vendors through providing an avenue to offload tickets.

“The risk is then transferred with onsellers taking on the associated risk of not being able to sell all their tickets or not being able to offload tickets in the event of a show cancellation,” the paper reads. “In addition, unauthorised ticket onsellers assume the risk associated with uncertainty of sales and the price they can obtain for tickets in the secondary market.”

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