by Bryce Cashman, Legal Intern
With the summer concert season not far away, event promoters and music fans alike face a growing challenge—the state of online ticket sales for live events. Fans are increasingly boxed out when tickets go on sale, and venues will often sell out to audiences that paid much more than the original price because they were forced to buy their tickets on the secondary market, through sites like StubHub or Craigslist. Essentially, it seems harder and harder for fans to access face-value tickets for certain types of events.
Among the reasons for this problem: the practice of online scalping through the use of bots. “Bots” are computer programs that are able to buy tickets rapidly and in mass quantities using credit cards. Bots often evade online ticketing companies’ security programming and shut out human consumers, often raking in the best seats in the house and reselling them at inflated prices on the secondary market.
For consumers, this means higher prices, and that extra amount that they’re paying on top of the face value doesn’t go to the artists or promoters, or even a legitimate ticketing service, but to a third party that has nothing to do with putting on the event. “Cut out the middlemen” may be a music industry cliché, but resellers using bots represent a kind of middleman standing in between musicians and consumers that add nothing of value for anyone; it’s purely parasitic behavior.
To combat this practice, promoters and ticketing companies have a very limited arsenal of tools. The more resourced ticketing companies can implement monitoring systems and security measures to identify suspicious activity of mass quantity purchases and slow down the process, by pushing the bot user back in the cue of online customers, for example. But as with any hacking scheme, code can be written speedily and implemented on a rolling basis, thus making it difficult for ticketing companies to keep up with bot users’ innovations.
While some states have passed anti-bot legislation to try and combat the problem, it doesn’t appear that this has made much impact. Tennessee is one such state that enacted anti-bot legislation, but has yet see a single conviction under that law. In part, this is because ticket sales may happen across state lines, creating questions about jurisdiction. Confusion arises as to the enforcement of state laws when a scalper in New York uses bots to buy tickets in California.
In February, Rep. Marsha Blackburn (R-TN), Rep. Jim Cooper (D-TN), Rep. Steve Cohen (D-TN), and Rep. Scott DesJarlais (R-TN) brought the issue to light with the introduction of a new bill: The Better Online Ticket Sales Act. The cleverly named “BOTS” Act identifies the use of bots to bypass ticketing security efforts as an “unfair and deceptive practice” under the Federal Trade Commission Act. As such, the practice would be deemed a federal crime, solving the interstate jurisdiction issue, and offering a clear right of action via FTC complaints to pursue litigation, for anyone who has suffered damages, be they ticketing companies, promoters, artists, or even fans.
The bill currently has the support of major stakeholders in the concert industry including Live Nation, the parent company of Ticketmaster, and the Recording Academy.
For their part, artists may currently feel like they have limited recourse as well, and feel pressured to inflate their ticket prices to try and keep them off the secondary market. But this can be a dilemma for artists and promoters who want to make their concerts accessible to fans who aren’t wealthy. Some artists, like the Foo Fighters, may choose in person/non-transferable/box-office-only sales, but this can be a logistical challenge beyond the means of many bands.
The new bill is unlikely to be a silver bullet solution to predatory resale practices. The cost of pursuing a federal complaint can be high, so damages may only be accessible to some of the larger commercial players. Still, it may prove a successful deterrent to bots and lead to their gradual decline in the long-run. But bots aren’t the only problem, and even some of the bill’s supporters are engaging in practices that many fans would find questionable. Ticketmaster/Livenation, for example has reportedly been setting aside large blocks of tickets for resale, including through its own proprietary resale site Ticketsnow, leading some observers to speculate that the company is actually fine with some kinds of bots; they just want to monopolize the secondary marketplace for their own events. Indeed, some top tier artists like Justin Bieber have been accused of scalping their own tickets, something this bill won’t address. Nonetheless, the bill is a step in the right direction towards addressing this problem, and we welcome its introduction.
Watch our legislative tracker for updates on this bill and others.
Image via Shutterstock.