Wednesday, February 27, 2013

Is Tenneseee's Proposed "Fairness in Ticketing Act" Really Fair ?

Back in December, I wrote a blog article about a proposed law working it's way through the Tennessee Legislature. The article was titled "A Season of Miracles" (read it here). At the time, the article's purpose was two fold. First, it contained some of my usual sarcasm in order to provide a few laughs. Second, after first learning about the bill while reading a local newspaper, I felt it was worth making others aware of it, too. More recently, I've looked into the bill even further and found that the issue is worth visiting again in more detail.

Tennessee Capitol Building at night
The bill is known as the "Fairness in Ticketing Act." Supporters of the bill claim it will curb scalping. Opponents of the bill claim it will infringe on the property rights of consumers by making it more difficult, if not impossible, to transfer legally owned sporting event and concert tickets to family members or friends. Who's right ? I'll tell you in this article.

I am a firm believer in President Reagan's mantra of "trust but verify." So, after reading various press releases, blog posts, Facebook pages, and websites applicable to the issue, I decided to go to the Tennessee Legislature's website and read the actual text of the bill. I felt like I needed to determine for myself what the bill actually did and which side was telling the truth. I want to encourage all Tennesseans who buy tickets to sporting events, concerts, etc. to do the same. A summary of the bill can be read by clicking here, and the entire text of the bill can be read by clicking here.

When I read through the entire text of the bill the first time, it reminded me of the Affordable Care Act a.k.a. ObamaCare law because of how ambiguous and complex it is. Fortunately, the bill is only about ten pages long, because I had to read it multiple times to really make any sense of it. My first impression was that it was nothing more than a progressive, big government regulatory bill, because it will require so-called ticket brokers, better known as scalpers, to register with the state of Tennessee, pay a fee (the Progressive term for "tax"), and basically get a permit to scalp tickets. I did not see the threat to regular everyday consumers, until I had read the bill a few more times and let the words sink in. I ultimately found that, like ObamaCare, the dangers with the bill are not what the legislation is saying, the devil is in what it's not saying.

There are a number of consumer-related problems within this bill. For instance, consider Section 62-45-107(2) which states :
To preserve the rights of consumers to secure tickets to entertainment events through safe and reliable means and to protect freedom of enterprise, nothing in this chapter shall prevent operators of places of entertainment, event presenters or their agents from utilizing any ticketing methods for the initial sale of tickets, through any medium, whether existing now or in the future (emphasis added).
Sounds good overall, right ? The Legislature is looking out for Tennesseans, right ? Well, hang on for a minute and let me point out what the bill says a "ticket" is. Section 62-45-103(23) of the bill states the following :
Ticket means a printed, electronic or other type of evidence of the right, option or opportunity to occupy space at or to enter or attend an entertainment event even if not evidenced by any physical manifestation of such right (emphasis added).
Now, if you're like I was when I first read these two sections of the bill, you're probably thinking, "O.k. Sheepdog. I must've missed something, 'cause I really don't see a problem here." That's exactly the problem with not only these two quoted sections but the rest of the bill as well. It's vague, open-ended, and open to interpretation.

Currently, there is a movement to go "paperless" with most event tickets. This legislation would likely accelerate that push. So then, what would we consumers use as a "ticket" to get into a ballgame or concert if it's paperless ? What type of "medium" would it be ?

Nashville Predators
Nashville Predators (Photo credit: Wikipedia)
One "medium" that might be used as a paperless "Ticket" is the credit card the ticket was purchased with. For example, let's say you buy tickets from someone, such as TicketMaster, to go watch the Nashville Predators play. You'd pay for the tickets with your credit card, then when you get to the arena for the game, you would swipe your credit card and show some form of i.d. to gain entry. Your "tickets" would be linked to your credit card. The main problem for consumers would then be if you wanted to transfer a ticket to someone else. For example, let's say you bought the tickets for someone else as a gift, or at the last minute had a scheduling conflict and couldn't make the game. Currently, you would just give the paper ticket, or maybe sell it, to someone else to go in your place. Guess what ? That ain't happening with a paperless ticket. The transfer, if even possible, will be much more difficult and potentially a real headache.

It's likely, however, that the ticket seller you bought the tickets from would be willing to help you transfer them, or perhaps refer you to an associated company who could provide that "service." In the case of a Predators ticket, currently their tickets are sold by TicketMaster. However, if, as in the example above, the tickets are paperless and linked to your credit card, you would likely only be able to transfer the tickets through TicketMonopoly .... oops, I mean TicketMaster or one of their "associates." Here's another question ? Do you think they will let you do that for free ? Of course not - just like with the airlines, everything, especially changes, costs money. No free lunch here.

Let's talk about TicketMaster for a minute. They are reportedly major supporters of this bill. I hate those guys. It's nearly impossible to buy a sporting event or concert ticket without going through them. That's why I refer to them as "TicketMonopoly." Plus, sometimes the so-called "service fee" they attach to each ticket can be nearly as much as the ticket itself. They've got a real lucrative racket going.

Image representing StubHub as depicted in Crun...
Image via CrunchBase
Remember my example above about the process involved if you wanted to transfer a ticket if this bill passes and tickets go paperless ? Here's something else you may or may not know about TicketMaster. They already own a "ticket broker" company called TicketsNow. TicketsNow is part of the secondary ticket market putting owners of previously purchased tickets with prospective buyers. TicketsNow basically does the same type of thing that the individual "ticket brokers," or scalpers, you see walking around on the streets and sidewalks holding up handfuls of tickets outside sporting events and concerts are doing. TicketsNow and their competitors, such as StubHub, just do it on a much larger scale. Now, can you guess who TicketMaster might use to provide the "transfer service" on those tickets you want to transfer ? C'mon guess. Ding, ding, ding. I think you're right. I'm betting it would be TicketsNow, too. Amazing isn't it ?

Back to those Preds tickets you bought. Let's say you bought those to take your family to a Preds game. This bill is law. One week before the game, something comes up and you and your family of four can't go to the game. You contact TicketMaster to transfer the tickets to a buddy and his family. TicketMaster directs you to TicketsNow who then charges you a fee to do the transfer. TicketMaster has just made money on both the original ticket purchase and the transfer. They've basically double-dipped. I'd also be willing to bet that TicketsNow would not only charge you a transfer fee but also another "service charge" like you paid on the original purchase. You getting pissed, yet ? Well, you ought to be, because you just got ripped off. If this bill passes, be sure to write the General Assembly and thank them for allowing it to happen.

Tennessee State Sen. Ken Yager
Personally, I believe the scalping problem is one that is easily fixed with a solution that is already in place - it's called the "free market." However, apparently the bill's sponsors, Sen. Ken Yager and Rep. Ryan Haynes, other members of the General Assembly, and the bill's supporters do not. They think "the gubmint" needs to step in and fix the scalping problem. They even said as much in Section 62-45-102(5) which states :
The general assembly must act to ensure a free market for tickets whereby consumers know what they are buying, artists and teams have the ability to ensure that fans have access to great seats at fair prices, and deceptive, anonymous resale and deceptive internet marketing practices are prohibited (emphasis added).
Tennessee State Rep. Ryan Haynes
They think they must protect us. Really ? I, for one, am sick and tired of the big government loving, progressives thinking they have to step in and fix everything. I also like the way they bring up the "free market" when it suits their purpose, but then quickly forget about it later when it doesn't. By the way - did I mention that both Sen. Yager and Rep. Haynes are Republicans ? Well, they are, proving once again that the GOP is not immune to the plague of progressivism, but I digress.

Personally, I think the main reason for this bill, besides enlarging TicketMaster's monopoly even more, is because is gives "the gubmit" more control. The bill will force every "ticket broker" to register with the state, pay a fee a.k.a. tax, and basically get a state issued permit to resale tickets. However, just like with ObamaCare, there is an exemption in the law regarding the resale of tickets. Can you guess who qualifies for it ? Ding, ding, ding. Man, you guys are good - you got it right again. It's TicketMaster.

Before I forget it, let me get back to the TicketMaster / TicketsNow relationship for a minute. Back in 2009, these two found themselves in the middle of an alleged scandal. It came about when some folks attempted to purchase tickets from TicketMaster's website to a Bruce Springsteen concert, but were re-directed to the TicketsNow website. There, these people found that the same tickets they tried to purchase from TicketMaster were being sold at "a premium price." Someone correct me if I am wrong, but that sounds like "scalping" to me. What about you ? Some alleged that TicketMaster did it intentionally, too. TicketMaster's defense was that it "was a glitch."

So .... let me get this straight - the General Assembly, with the support of TicketMaster, tells us that they "must act" and pass this legislation to protect "us" from the type of activity that TicketMaster and TicketsNow were alledged to have participated in ? Sounds like the fox telling the hens that he'll make them a great deal on a security system for the hen house. Hmmmm. (Read more about the alleged "scandal" by clicking here and here.) I ain't buying what they're selling. Are you ?

I've got a better, two-part solution. First, since according to Section 62-45-102(2) quoted above, "artists and teams," as well as the General Assembly, want fans to have fair access to tickets in the free market, how about if the ticket industry policed itself ? Why is additional government regulation needed ? The ticket industry could just stop selling the huge blocks of tickets to the scalpers and only sell the tickets to individuals. Plus, they could limit the number of tickets that can be purchased at one time by these individuals to maybe 4, 6, 8, etc. Doing so would give everyone wanting tickets a fair shot at getting them. Leave the government out of it. Nobody forces the ticketing agencies to sell the huge block of tickets to the ticket brokers. They choose to do so for one simple reason, and it has nothing to do with being fair to the fans - "It's all about the benjamins." They really don't care who buys the tickets as long as they get them sold and the money in their bank account.

The Scalpers Are Cheating The (Vancouver Folk ...
The Scalpers Are Cheating The (Vancouver Folk Music) Festival (Photo credit: Wikipedia)
The second part of this solution is where we, the fans, come in. We live in a free market with free market principles. We don't need government regulation to fix this problem. The simple law of "supply and demand" will fix it if we let it. The scalpers supply event tickets at huge markups, because we demand them. So, let's stop demanding them. Don't pay the outrageous prices. Then, the scalpers will have to lower their prices, or they'll still be stuck holding them when the game or concert is over.

Personally, I would not be surprised if it was found that many of the scalpers actually work for some of the artists, teams, and arenas. The reason I say this is because when I was attending the University of Tennessee in the late '80s, there were rampant rumors that the folks outside Neyland Stadium and Thompson Boling Arena scalping football and basketball tickets were actually hired by the UT athletic department. I do not know for sure if it was true, but other actions taken by the university led me to believe it was so.

The solution to the scalping problem in Tennessee cannot be solved with this lousy piece of legislation anymore than the meth problem was solved by a piece of lousy legislation. That one moved the decongestants behind the pharmacy counter making us "register" our purchases of cold medicine each time. You may remember that the General Assembly and law enforcement told us it was the ultimate fix. Now, that law has been such a dismal failure that they are considering passing another law which would require all decongestants to be available by prescription only. You know what that means ? Yes, you will be required to go see the doctor each and every time you get the sniffles if you want a decongestant. Most Tennesseans have allergy problems, so such legislation would result in a ton of extra doctors visits. Since they were wrong on the meth bill, why should we trust them on this one ? But, I digress, again.

In my opinion, we shouldn't trust them on this one either, especially when you consider that the bill is anything but "fair" to us, the ticket consumers, because it will infringe upon our freedom to transfer tickets we have purchased with our money. The only people it will benefit are the state's coffers and large ticket sellers like TicketMonopoly. Sorry, I did it again. I mean TicketMaster, but you knew that already. Bad Sheepdog.

I've addressed the highlights of what, in my opinion, is wrong with this bill. I could go on and on. Now, can I say for sure that the projected possibilities I've used in this post will come true if the bill passes ? Of course not. However, the supporters of the bill, likewise, cannot tell you with absolute 100% certainty that I'm wrong, either. That's the problematic part of the whole piece of crap legislation. There is so much ambiguity that we don't know exactly what it will and will not allow to occur. That's why it must be defeated. One thing I can guarantee is that it will not stop scalping. The scalpers will find a way around it.

Photograph of the Tennessee State Capitol on a...
Photograph of the Tennessee State Capitol on a sunny day, the central cupola soaring against a clear sky. (Photo credit: Wikipedia)
If Tennesseans want to remain free to do with their tickets what they please, then it is imperative that they contact their elected representatives. If you don't know who your State Senator and State Representative are, you can find out by clicking here. I can guarantee you that the folks with the money who support the bill, such as TicketMaster, are contacting the legislators. If we, Tennesseans, don't contact our representatives, it will be hard to defeat this bill. Plus, don't forget - this bill brings with it additional tax, ... oops, I mean fee, revenue. Politicians really like "the benjamins" and that makes the bill very appealing to them.

Therefore, we have to let them hear from us, because we have something that they like even more than revenue, and that's ....... our votes.

P.S. Here's one other little tidbit for you to think about. Section 62-45-110 of the bill states that, "A ticket represents a revocable license, held by the person in possession of the ticket, to use a seat or standing area in a specific place of entertainment for a limited time."

Tickets are already licenses, but this legislation reinforces that more. Additionally, if you flip over your sports or concert ticket, somewhere in the fine print it will say something along the lines of "no refunds or exchanges." Therefore, if this legislation becomes law, and you don't follow it to transfer a ticket purchase, the ticket can be revoked by the issuer without giving you a refund. Now, think about that the next time you buy those $100-a-piece professional sporting event tickets.

Man, wouldn't that suck if those tickets were taken away from you and no refund offered ? You might want to call your representatives now.
Enhanced by Zemanta

No comments: