The BOSS Act Protects Both the Rights and Pocketbooks of Event-GoersJune 26, 2019
This week, Congressman Pascrell (D-NJ), Congressman Pallone (D-NJ), and Senator Blumenthal reintroduced the BOSS Act in a renewed attempt to bring transparency and fair practices to the online market for event tickets. Public Knowledge applauds the Act, which looks to end the worst abuses of the consolidated ticket sale/resale market while maintaining an individual ticket holder’s right to do what they want with the ticket they purchased.
The shenanigans afflicting ticket sales came to Congressman Pascrell’s attention in 2009, when thousands of Bruce Springsteen fans experienced an error message on Ticketmaster’s official site and were then directed to TicketsNow to buy the tickets at a huge mark-up. This led to a rebuke of Ticketmaster by “The Boss” Springsteen himself and a public outrage that reached all the way to the halls of Congress.
This newest version of the BOSS Act has three main approaches. First, the Act would end hidden fees by requiring both primary and secondary sellers to disclose the full price at the time of selection. Second, it would equalize resale markets by prohibiting venues, primary sellers like Ticketmaster, and their affiliates from knowingly reselling tickets at a higher price. Third, it would set up protections from fraudulent practices that lead to the same seat being sold twice and eTickets being sold but never delivered. These protections are helpful for long-abused buyers of eTickets.
Some have proposed banning reselling entirely to try to fix ticket markets. This would address not only schemes by the venues and large promoters like Ticketmaster but also the scalping bots that have infected the market. Some artists oppose resale because they want to be able to sell tickets below market value to ensure access for diehard fans. State governments have taken varied statutory approaches. States like Colorado and Missouri statutorily protect the right to resell tickets in an effort to protect consumers, while other states target professional scalpers by severely restricting resale.
Bans on reselling and ticket transfers are the wrong approach. Public Knowledge is a staunch defender of customers owning what they buy, and this includes the ability to sell, or give away, event tickets. Limiting resales would prevent consumers from unloading tickets to events they can no longer attend and even make gift-giving more difficult.
The idea that consumers should own the things they buy, with all that entails, seems noncontroversial. But many things that people pay for today are characterized as “licenses,” which can be limited in various ways, and digital technology has made it easier than ever for companies to impose fine print and one-sided agreements on consumers. But whether thought of as conditions on a license or terms of a contract, these terms (and related methods such as digital locks, or tying a product to a specific online service) can significantly restrict consumer rights. Not only can they prevent resales, they can limit repairs, require that consumers buy overpriced add-ons and supplies, transform simple contract violations into copyright violations, or even take away things consumers thought they had.
This is why Public Knowledge has called for principles such as Digital First Sale, and the right for consumers to be able to unlock and transfer devices, such as cell phones. The same principles should apply to ticket sales, and it’s not necessary to restrict ordinary consumers to put a stop to ticket-buying bots and commercial scalpers.
Restricting consumer resale also exacerbates one of the worst problems in the ticketing market: A lack of competition. In recent years, concert-goers have experienced an increase in hidden fees and the underhanded sales tactics that prompted the original 2009 proposal. Some observers point out that these problems seem to get worse as the online ticket market becomes increasingly consolidated. After the merger of the two largest ticket sellers in 2010, the Live Nation-Ticketmaster union controls 80 percent of the market for ticket sales. Ticketmaster also owns TicketsNow, the second-largest secondary online reseller and the site behind the Springsteen debacle. Perhaps unsurprisingly, then, the Government Accountability Office released a report in 2018 documenting increasing ticket sale abuses in recent years. Lack of competition often leads to higher prices and the proliferation of abusive practices. This principle of causation is nothing new. However, the weakened antitrust paradigm of recent decades has allowed the familiar problem to rear its ugly head, as airline passengers, prescription drug users, and now concert-goers can attest.
That is why heavy-handed schemes to address problems like scalping by banning resale are bad news for ticket markets. Not only do consumers have a basic right to resell tickets they bought and can’t use, but with only one real commercial seller game in town, individual resales are one of the few venues left where competitive pricing forces can still operate.
The BOSS Act will not break Live Nation-Ticketmaster’s market dominance. It will not solve every unique challenge in the ticketing market, some caused by bots, many stemming from artists’ admirable desire to keep tickets affordable for ordinary fans without creating opportunities for unfair arbitrage. However, by mandating pricing transparency and preventing Ticketmaster from participating in collusive resale schemes, the BOSS Act would bolster competitive sales practices and thwart the bad behavior that sparked the original Springsteen outrage. And importantly, it will do so without stifling the free exchange of tickets among individual purchasers.
We have seen the world of online ticket sales become a mess of intertwining problems. The Federal Trade Commission followed up the aforementioned GAO report with a recent workshop to examine the different problems, including bots, restrictions on consumer resale, and pricing schemes. However, Public Knowledge believes the BOSS Act is a good start. Pascrell’s Springsteen statute would balance the two sides of the consumer rights coin, both of which are equally important to ensure a healthy market for live entertainment in the Internet Age.