SBD/December 10, 2012/Marketing and Sponsorship

StubHub, MLBAM Sign Five-Year Contract Extension; Yankees, Angels Opt Out

Yankees, Angels have already opted out of the new contract with StubHub
StubHub and MLBAM have “signed a five-year contract extension” for StubHub to “remain baseball’s official ticket resale marketplace,” according to Eric Fisher of SPORTSBUSINESS JOURNAL. Financial terms were not disclosed, but the parties “will participate in a revenue-sharing agreement.” The original pact was “estimated to be worth nearly $60 million a year, when also including offline MLB team sponsorships, and the new deal will increase beyond that.” StubHub has been “under heavy criticism from some teams for aggressively promoting available ticket listings far below primary market prices and sometimes under a dollar.” StubHub will “seek to address the undercutting complaints by moving toward an all-in pricing model in which MLB ticket listings beginning next year will show upfront the total cost to purchasers when also factoring in commissions, delivery and other fees.” Under the new structure, the “minimum MLB ticket cost on StubHub in full will be $6, due largely to changes in how electronic delivery fees are calculated.” But the “days of the 50-cent ticket listings on StubHub are now over.” Under the contract, teams also will “gain greater latitude on whether they want to have StubHub participate in offline marketing, such as signage, within their ballparks.” Buyers also will see “secondary ticketing links directly on MLB.com and official team pages, and in some markets fans will still be able to pick up StubHub orders at ballpark will-call windows.” But at least two MLB teams, the Yankees and Angels, have “already opted out of the new contract with StubHub” (SPORTSBUSINESS JOURNAL, 12/10 issue).
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