Flash Seats Gets Vertical

A ticketing company that provides the NBA’s Cleveland Cavaliers with a paperless electronic platform for secondary sales is making its first play for the primary market.

Cleveland-based Flash Seats has acquired Vertical Alliance, a primary ticketing company, and the purchase means Flash Seats could begin offering clients a total ticketing package.

The Flash Seats client list includes the Cavs, Quicken Loans Arena and Lake Eerie Monsters, while Vertical Alliance currently serves Boise State University, Texas A&M, the Houston Rockets and the Houston Toyota Center.

"Integrating Vertical Alliance’s primary ticketing solution with Flash Seats’ secondary ticketing marketplace allows us to offer our clients the most robust, end-to-end ticketing solution in the industry," said Sam Gerace, CEO of Flash Seats, in a statement.

But there’s a catch.

While Gerace told the Plain Dealer the company hopes to eventually provide all ticketing services for the Cavs, Flash Seats won’t be stepping into primary ticketing for the team any time soon. For starters, the team is contracted with Ticketmaster through the 2009-10 season, but Flash Seats and the Cavs are also battling TM in a whole other kind of court, after the ticketing company filed suit last July for breach of contract, among other complaints.

TM’s suit claimed it has the exclusive right to sell tickets for any attractions scheduled or presented at the team’s home venue – the Quicken Loans Arena – via all means and methods including primary ticket sales and Internet sales, as well as auctions and ticket resales.

Flash Seats and the Cavs countersued, claiming TM engages in "anticompetitive practices, such as its use of illegal tying arrangements, long-term exclusive contracts and its threats and use of ungrounded litigation."

So until the issue is resolved, Gerace told the Plain Dealer, Flash Seats will have to head in a different direction.

"We’re going to focus our sales and marketing efforts elsewhere," he said.

Still, Flash Seats may be able to create a niche for itself in the market with clients who want to take their ticketing in-house.

"This acquisition adds value to team and venue operators and also enhances the fan experience," Gerace said. "Teams and venues can control their entire ticket economy, primary and secondary, and maximize the lifetime value of the fan."

Sounds like the philosophy of another in-house ticketing company – Paciolan – which was acquired by TM earlier this year.