The Internet has become a major playing field for event ticket buyers and sellers in the extremely competitive $10 to $12 billion event ticket market, particularly for sold-out sports games and concerts and plays. very popular musicals Called the event ticket secondary market, this is the part of the event ticket market that includes tickets purchased by professional brokers, as well as extras that season ticket holders are not allowed to use. People estimate the size of the side event ticket market to be around $2 billion, though estimates of its size vary widely.
A huge market with tons of small players, the pre-Internet event ticket market was a perfect match for the Internet circa 1999, and as we fast forward to 2006, hundreds of familiar electronic storefronts, auction-based websites, and online Destinations now resell tickets for side events. While many of these are small operators, there are some major players as well. Unsurprisingly, eBay members are in on the act, too, and in a big way. In fact, the biggest players of all in the event ticket secondary market are eBay members, who as a group sell more than $300 million in event tickets annually and have the largest community of buyers and sellers.
But eBay members also offer the greatest potential for fraud. Like everything else sold on eBay, stories abound of people being scammed into buying bogus event tickets. Although buyers can check how others have rated a given seller, eBay largely operates on an honor system and offers fertile ground for fraud.
To avoid this event ticket fraud problem, some secondary event ticket sellers offer 100% guarantees. If you get a bad ticket, they replace it for free. Other secondary event ticket sellers take possession of the event tickets and verify them before listing the event tickets as available for sale.
Online event ticket sales are growing as consumers become more comfortable shopping online. One source estimates that ticket sales for online events will grow 27 percent this year.
Even professional sports teams participate in the side event ticket market. Demand for Chicago Cubs tickets is so high that the team established its own secondary market for event tickets with a team-owned ticket broker.
Reselling event tickets, also known as “scalping,” is not illegal. However, event ticketing is often illegal when event tickets are sold in the vicinity of an event.
Thirty-eight states, including California, do not have significant restrictions on the resale of event tickets. In twelve states, the resale of event tickets is regulated. In about half of those states, ticket brokers who do inventory must register with the state. In the remaining six states, event tickets cannot be resold above a maximum price premium. In these states, a broker may be allowed to charge up to 20 percent more than the face value of the event ticket.
