More Scalper Scrutiny

The news that AEG supplied Michael Jackson tickets for viagogo to sell to the public for premium prices has produced a raft of stories about how the secondary market functions.

Nine Inch Nails leader Trent Reznor’s recent blog post said virtually everyone involved in a concert is supplying tickets to the secondary market, while one of the U.K.’s top ticket security experts told Pollstar that resale sites purporting to help fans are also buying tickets to sell to fans for huge profits.

“The venue, the promoter, the ticketing agency and often the artist camp (artist, management and agent) take tickets from the pool of available seats and feed them directly to the reseller,” Reznor explained, adding that there are exceptions. “There is money to be made and they feel they should participate in it.”

“Viagogo does not buy or sell tickets, it simply facilitates the exchange of tickets via its Web site,” a company spokesman told Pollstar. Seatwave chief Joe Cohen has said his company never buys tickets to resell.

But Reg Walker, a ticket fraud expert who works with the O2 Arena in London and major U.K. festivals including Reading, Leeds, Isle Of Wight and T In The Park, said he has proof that some of the major secondary sellers are buying tickets for resale.

He said he will put evidence before the Department Of Culture, Media & Sport that shows Seatwave sales manager Lee Lake has purchased tickets using six credit cards and had them delivered to four addresses in the Southampton area. He said Lake has since been banned from the O2.

“I don’t object to the secondary market doing what it’s doing regarding reselling tickets for fans, but it’s time it was more honest with the public about the source of some of the tickets,” Walker explained.

“At the O2, which usually operates on a capacity of around 18,000, the most people that have ever turned up on one night and said they can’t use their tickets is 16.

“Yet the secondary market was worth £500 million ($726 million) in 2007 and that will double to a billion this year. Almost all the major secondary sellers are buying in bulk, and that includes some that are members of the Association of Secondary Ticket Agencies.”

He said the secondary market’s bulk buying of “huge swathes” of tickets deprives fans the chance to buy at face value.