How StubHub Helped Ticket Scalping Go Legit

8:00 AM PST 02/07/2013 by Dean Budnick
Illustration by: Kyle Hilton

"Secondary ticketing" earns its practitioners up to $12 billion a year, helped by its own trade association: The National Association of Ticket Brokers.

This story first appeared in the Feb. 15 issue of The Hollywood Reporter magazine.

Looking to rekindle some romance by scoring tickets to that sold-out Fleetwood Mac show?

If you haven’t tried to get tickets to a sold-out show since Christine McVie was touring in the band, then it’s time for a primer. The days of street scalping are long past.

Come to think of it, so is the term, which has been replaced by the tonier “secondary ticketing,” coined by Eric Baker, who launched StubHub out of a Stanford Business School classroom with Jeff Fluhr back in 2000. The polite term for scalper is now “broker.” There even is a nonprofit trade association, The National Association of Ticket Brokers, devoted to serving and protecting a business that rings up an estimated $8 billion to $12 billion in sales.

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But isn’t this stuff illegal? The short answer is no. 

There is no national legislation and only a few remaining state laws that prohibit reselling, while those in place carry minimal bite and are ill-equipped to deal with online sales, where sellers from two different states may complete a transaction for tickets to a venue at a third state via a computer server housed in a fourth state. It’s so easy to list tickets for resale online that everyone does it. So when that hot concert goes on sale, not only are the pros trying to land seats but so are soccer moms, stay-at-home dads and college students -- all of whom hope to score choice tickets and make a quick flip.

Come to think of it, though, the pros don’t wait for the general onsale -- they likely already have cut a deal with someone up the food chain, or they hold season tickets to all events at a given venue, or they’ve purchased tickets during one of the many presales with the 100-plus credit cards they routinely carry.

Then again, you’re a VIP anyhow, so why not bypass scalpers and brokers alike and go directly to the source by purchasing the Mick Fleetwood VIP Experience. For $495, you’re guaranteed sweet seats, a photo op and a Q&A with Mick Fleetwood onstage at his drum kit.

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