Baltimore's two major sports franchises addressing secondary ticket

Daily Record, The (Baltimore), Aug 13, 2007 by Louis Llovio

Baltimore's two major sports franchises are taking different paths to address the growing $3 billion secondary ticket market.

While the Orioles have not decided whether to join other Major League Baseball franchises in an agreement that would lead ticket buyers to StubHub.com, the Ravens point interested fans to one of their advertisers, TicketsNow.

Their reasons are as varied as their sports and their attendance figures.

The issue of reselling tickets isn't as big for the Orioles as it is for the Ravens because good seats are available at the Camden Yards box office for nearly every game. The Ravens, though, have sold out every home game they've had since they came to Baltimore, making it tough for non-season ticket holders to find a seat.

Yet, both are working to find a balance that will help fans and deal with a growing industry that specializes in reselling team- issued tickets.

Starting next season, many MLB teams and StubHub will work together to sell tickets for games. Fans looking for tickets on a team's Web site can either buy directly from the team or look for seats on StubHub.

Tickets on StubHub are usually posted by fans who own season tickets and can't attend home games.

The ticket company pays teams for the service and then charges both buyers and sellers for the transaction. The buyer pays a 10 percent fee and the seller is charged 15 percent; so, if a ticket sells for $100 on StubHub, the buyer pays $110 and the seller gets $85. The remaining $25 is split between StubHub and the team.

Matt Gould, a spokesman for MLB Advance Media LP, said baseball would not say how much of that will go to teams because baseball does not release specific breakdowns of its revenue-sharing agreements.

Participation in the StubHub deal is not mandatory. An Orioles spokesman said last week the team has not decided whether it will participate, but declined further comment.

According to Gould, it is too early in the process to know how many clubs will take part. He did say MLB expected "a good number of teams" to participate, though he would not specify.

The partnership will give StubHub the added legitimacy of being recognized by the teams and will give buyers a sense of comfort that they are buying from a trusted source. StubHub, which was purchased by eBay in January, said it sold $400 million worth of tickets during 2006.

Bob Bowman, president and CEO of MLB Advanced Media, said the league went with the agreement because it was "safe, simple and secure" for fans looking to buy tickets.

StubHub called the deal a vindication for the secondary ticket market because it gives the industry a stamp of approval.

"This partnership truly represents a win-win for both parties," said Chris Tsakalakis, president of StubHub.

Tsakalakis said partnering with MLB gives the company legitimacy while giving baseball access to the technology the company has developed that matches sellers and buyers, and can guarantee sales.

While the deal will give clubs and the league some control over ticket sales, it won't eliminate the secondary ticket market that the teams don't control.

Baseball fans will still be able to buy and sell tickets online through other brokers or services like eBay and Craigslist.

Tickets can also be found in more traditional places like the classified section of most newspapers. Then there are traditional ticket brokers like Great Seats in Baltimore and Executive Tickets Inc. in Catonsville, or Web sites like tickets.com and ticketmonster.com that sell tickets they've purchased from sources themselves.

And, of course, tickets can be bought outside nearly every sporting event in America, sometimes from fans looking to get rid of an extra seat or from scalpers trying to make a few dollars.

Stephen Happel, an economics professor at the W.P. Carey School of Business at Arizona State University who has studied and written extensively about the secondary ticket market, said teams are taking these measures to cash in on ticket sales.

In 1999, the San Francisco Giants partnered with tickets.com and created a program called Double Play Ticket Window.

Fans go to the team's Web site where they buy secondary-market tickets that are then left for them at Will Call or mailed. The team, which collects the payment, says that buying tickets through the site is "similar" to buying directly from the team.

Last year, the National Basketball Association's Cleveland Cavaliers purchased a California ticket company called Flash Seats to handle their secondary-market sales.

Both teams allow tickets to be resold for above face value. The Cavaliers collect 20 percent of the sales price from the buyer while the Giants take 10 percent. That, of course, is above what the teams made on the original ticket sale.

Not every team is so enthusiastic about reselling their tickets above face value.

The Denver Broncos have an agreement with Ticketmaster's TicketExchange, which like StubHub allows ticket holders to post tickets.

But the NFL team mandates that season ticket holders are only allowed to sell them through TicketExchange and that the tickets can't be sold for over face value.