THE BLOG
21/03/2012 16:59 GMT | Updated 21/05/2012 06:12 BST

Put Fans First

Last week saw the launch of StubHub UK, the latest invasion of a secondary ticketing business from across the Atlantic.

Last week saw the launch of StubHub UK, the latest invasion of a secondary ticketing business from across the Atlantic.

StubHub was the original secondary ticketing website, launched in the US in 2000. Since then it has been acquired by eBay, and one of its co-founders, Eric Baker, left in 2004 to set up viagogo, now one of the UK's foremost ticket reselling websites.

Speaking to Forbes Magazine about the launch, StubHub President Chris Tsakalakis estimated that the UK market in intermediated resale is worth $500m annually - a strong incentive to set up shop in an already crowded UK marketplace, which includes eBay itself.

Supporters of this kind of website, which includes Seatwave and GetMeIn (both also of American origin), claim that they allow fans to sell on tickets that they can no longer use, or pick up tickets if they weren't able to get any from the primary agent, or at the last moment.

However, it has been clear to many of us for some time that they have not been the fan-to-fan exchanges that they claim to be. After all, what fan, having set themselves at their computers or the phones to be ready to punch in their card details at 9am on the day that tickets to an event go on sale, would then decide that they can't go after all?

No, a true fan wants the ticket for themselves - it is the touts who buy to sell on at huge profits, and are aided and encouraged by these sites to do so.

The scenario of tickets going on sale at 9am and being instantly available through secondary websites is not uncommon. Nor is it confined to big stadium tours, or high-profile sporting events - even horticulture and renaissance art fans have been left scratching their heads over whether to shell out 3 or 4 times the value of the tickets they wanted to buy to get into the Chelsea Flower Show and the National Gallery's da Vinci exhibition over the last year.

But why does this happen? The websites themselves would have us believe it is simple supply and demand - fans sell their tickets on at whatever price the market will bear.

However, last months Dispatches: The Great Ticket Scandal documentary put paid to the repeated protestations from secondary ticketing websites that they are merely a passive conduit or facilitator for fans.

The documentary, which sent undercover reporters in to viagogo and Seatwave posing as employees, showed that this image serves as a shield behind which a much bigger and murkier system operates.

Specifically, the undercover reporters recorded staff at viagogo admitting that they receive tickets directly from promoters that were never available to fans at the price stated on the ticket, as well as using a book full of credit cards registered to various names and address to compete with fans to buy tickets when they go on sale from the official sources to sell on themselves.

Viagogo have claimed that the latter practice involves only a 'small amount' of tickets, which they buy to give to consumers should the people who sell through their site fail to deliver.

However, as I have asked them directly, notwithstanding the fact that the Dispatches film showed their employees admitting that those tickets are bought to be resold, and that the ThisIsMoney website had exposed this practice previously, why would they need to go through such a process when they could just as easily phone up the promoter to request a small allocation for this purpose?

The promoters named in the documentary as having surreptitiously funnelled tickets to the secondary market have been at pains to say that they do not do so if the rightsholder or their management does not want them to.

To an extent, you can't blame artists and their managers for wanting to use the secondary market to their advantage - after all, if they don't make that money, there's nothing to stop someone else from doing so.

In many ways, as long as it is open and transparent, money going to those whose talent and investment have created the show is far better than going to someone completely unconnected, who has done nothing apart from being the quickest at buying a ticket.

But the fact remains: whoever instigates and is complicit in the deception, fans are still being deceived, and being made to pay arbitrarily high prices for the same tickets as the lucky ones who were able to acquire them at face value.

This is not how a healthy market works.

So far, the government haven't conceded that there is a problem in the secondary market, and keep referring back to the investigations that both the Select Committee and the DCMS itself did a few years ago.

Apart from the fact that the conclusions of those reviews seem completely incongruous to the evidence which was submitted to them, all would agree that the market has exploded since then because of the green light it basically got from the government, and Dispatches showed clearly the extent to which the market is now being manipulated against the consumer.

Since Dispatches aired, I have had many hundreds of emails and tweets from ordinary fans whose have eyes were opened to the deception which is endemic in the secondary market.

They are angry, and they want something done.

I introduced the Sale of Tickets (Sporting and Cultural Events) Bill in June 2010 after my daughter had a bad experience trying to buy tickets to Take That, only to find that they had sold out, but then found out that hundreds were available on secondary sites within minutes at grossly inflated prices.

However, though I had my suspicions, and had heard anecdotal accounts, even I didn't know the scale of the problem that Dispatches uncovered.

I am hopeful that Dispatches, and the anger it has provoked, can lead to a change of heart from Ministers.

In a Westminster Hall debate on Wednesday secured by Mike Weatherley MP, Sports Minister Hugh Robertson indicated that the government might take action if the Office of Fair Trading report that the market is failing consumers. I have written to them to ask that they launch an investigation to this end as soon as possible.

Further to this, I also intend to write to HMRC to ensure that VAT is being paid at the correct source, as if these websites are actually the first point of sale for tickets, or if they are selling tickets they have acquired themselves, much more VAT should be paid than just on the fees that they add on top of the ticket prices they advertise.

I am not on a vendetta against individual websites, or the secondary ticket market in general - until promoters and primary agents offer refunds or ethical ticket exchanges, like Radiohead are doing in partnership with the The Ticket Trust, there will always be a need for services which allow individuals to sell unwanted tickets on.

My Bill would allow the rightsholders to opt-in to protect their tickets from being resold at a price greater than face value plus 10% to cover associated costs. It would not stop people selling unwanted tickets on to recoup their money, and it would not put any secondary websites out of business - although they may not make as much money off the backs of true fans as they do at the moment.

The event-holders would have the option of not opting-in, or authorising certain companies or individuals to resell tickets at unregulated prices if they wanted to - the important part being that if they did, their target customers would know about it. Above all else, it aims to bring transparency to a market which thrives in the dark anonymity that the internet affords.

I have been encouraging those outraged by The Great Ticket Scandal to make their voices heard by writing to their MPs - this is already having an impact, and support is growing in Parliament. Anyone who is yet to get involved can find details on my website.