SBD/Issue 86/Facilities & Venues

StubHub President Claims Paperless Tickets Hurting Fans' Options

Tsakalakis Argues Fan
Choice Being Eliminated
StubHub President Chris Tsakalakis said paperless ticketing is reducing fan choice and stifling marketplace competition. Electronic ticketing, where entry to an event is obtained typically using a magnetic strip on a credit card or driver's license, represents an estimated 1% of the marketplace, but through efforts of companies such as Veritix and Ticketmaster, it is growing rapidly and gaining increased adoption among pro and college teams. Tsakalakis at the Ticket Summit conference in N.Y. Friday argued that fan choice is being eliminated by rules that often limit resale of those electronic tickets to secondary forums operated by the primary ticketing vendor, venue or team. "People often talk about the virtues of paperless ticketing, and there are some, but there are also two main negatives: It takes away fan rights and eliminates resale competition," Tsakalakis said. "And with no competition, you usually get a lower level of service and higher prices." Tsakalakis said the company's future plan to combat paperless ticketing is not fully clear, but said, "We think there's scope here for potential regulation." He added StubHub would continue to inform consumers on the drawbacks of paperless ticketing. Veritix has sold more than 2 million paperless tickets since its '06 launch as Flash Seats and generated more than $500,000 in new secondary ticket revenue so far this season for its NBA clients the Cavaliers, Jazz, Nuggets and Rockets. It predictably disputed StubHub's view. "The free market is defined by the content owners," said Veritix President Jeff Kline. "And content owners -- the leagues and teams -- are choosing us because of what we provide. It seems pretty clear that what Chris is seeing is that the market is shifting, and that he's losing business in the markets where we're at."

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