Ticket Bots Are Now Illegal - How Will This Impact the Arts?

 Source: https://www.flickr.com/photos/ginnerobot/3431671190

Source: https://www.flickr.com/photos/ginnerobot/3431671190

Over the past year and a half, AMT Lab has provided extensive coverage of the impact of ticket bots on the performing arts. In early 2016, we introduced the issue and provided case studies by talking with various arts organizations around the country, including the Pittsburgh Ballet Theatre and Ballet Austin, about how they have been recent targets of online ticket scalpers and the technology used to make as much of a profit as possible off of other people’s art: ticket bots.

Later in 2016, the topic received much national media attention due to skyrocketing secondary market prices for tickets to the wildly popular Broadway musical Hamilton. This sparked debate among the industry and policymakers at both the state and national level.  New York Attorney General Eric Schneiderman released a report that detailed the issue and provided legislative recommendations. Many of his recommendations were later developed into the national BOTS Act.

Early this year in April, I was invited to present my white paper and additional research on this topic at the Museums in the Web conference in Cleveland, Ohio. Click here to read the full white paper that was developed for the conference, which gives an in depth look at how ticket bots operate, how they have impacted the arts, and recommendations for arts organizations moving forward. Since the time of the white paper submission in late 2016, the BOTS Act was approved at the end of President Obama’s term and became a law.

The BOTS Act’s goal is “to prohibit the circumvention of control measures used by Internet ticket sellers to ensure equitable consumer access to tickets for any given event, and for other purposes”. The main stipulations are to:

1.     Give enforcement power to the Federal Trade Commission, who can take civil action against bot users

2.     Allow state attorney generals to take civil action against scalpers using bot software

How does enforcement move forward to stop people from using bots? Will FTC or the various state attorney generals dedicate resources to actually enforce the law? These questions will take time to answer and it remains to be seen how successful the act will be in preventing online ticket scalpers from their practices. To date, there has been minimal legal action against those using ticket bots across the country. However, New York State showed they meant business in early May of this year, as about $4.2 million in settlements were reached between the state and six ticket brokers for illegal ticket scalping activity. However, ticket bot software available online to anyone wishing to purchase it is still operating full force. In fact, in April when I talked to the online chat bot at ticketbots.net, they immediately assured me their “softwares” were still considered legal!

 Conversation with "Elen Cook" from Ticketbots.net

Conversation with "Elen Cook" from Ticketbots.net

For arts organizations to ensure they are most protected from ticket scalpers both now and the future, AMT Lab recommends the following solutions to arts organizations:

  • Monitor ticket sales and do not be afraid to stand up to scalpers: For example, a few years ago, the Cleveland Museum of Art discovered that a single individual purchased hundreds of tickets. Museum representatives got in contact with him, returned the tickets and refunded him, hoping to project the image that what he was trying to do was unacceptable.

 

  • Raise awareness among customers: For instance, Ballet Austin inserts a blurb in all patron emails that states: “If you feel like the price you paid is too high for your tickets, it probably was. In the future, please buy directly through Ballet Austin for the lowest price possible."

 

  • Supporting Stricter Bot and Scalping Laws: Arts managers should keep a pulse on what is happening in the industry, what is being done to enforce the new legislation, and work with the community to pursue civil action.

A potential additional legislative solution could be to end the ban on non-transferrable paperless tickets. This would require the original purchaser to be present at the time of ticket redemption, essentially eliminating the motivation for ticket scalpers buy in bulk to resell to the public, since the end, the purchaser wouldn’t have access to the physical credit card used at the point of original purchase.

In fact, this practice will be put into action for Hamilton’s run in London’s West End, starting October 2017. Customers will be able to purchase tickets online, but will need to be physically present at the box office themselves to pick up their tickets.

  • Supporting Industry Ownership of Current Concerns:  As mentioned, even though a major segment of ticket bots has become illegal across the nation, it remains to be seen if this will actually put a halt to the practice. Enforcing these policies, especially when many of the scalping entities and bots are housed offshore, may prove to be extremely difficult. Therefore, all stakeholders should encourage those with bargaining power to take a stance against ticket bots and other technologies that benefit those far removed from the art itself.

Sites like Ticketmaster can do this by ensuring that brokers that sell through their site comply with the law and don’t sell tickets purchased with the aid of bots. Some have started to recently do so through new technology such as Verified Fan that was piloted this spring for pre-sale tickets and will be rolled out more expansively in the future. This feature takes customers through additional verification steps before they can purchase tickets to an event online, such as giving their phone number to receive a code and/or linking to social media accounts.

  • Leverage similar ticket sale technologies (for profit enterprises): Organizations should consider a progressive approach rather than prioritizing precious resources on scalping activity from occurring completely, as it takes a great deal of constant effort to continuously block IP addresses and place limits on the number of tickets scalpers can buy.

For profit arts organizations should consider alternative methods to selling their tickets, such as the model that Hamilton ended adopting – removing price caps to ultimately let economic forces drive the price to what the market will pay for. However, instances of Hamilton’s accessibility concerns demonstrate the disadvantages to a lack of a price ceiling. Leveraging auction pricing tactics like what secondary market and fraudulent websites are using may give you the ability to offer tickets with price fluctuation based on demand, but should be implemented with caution.

 

Has your arts organization had any instances of digital ticket scalping recently? If so, we are interested in hearing your story, which you can share in the comments section below.