With COVID-19 ravaging the live entertainment world, ticketing companies are feeling the loss of income. Between mass cancellations and the uncertainty of when shows can be rescheduled has led to massive layoffs and financial hardships.
Ticket Brokers have been hit harder than most. Due to these cancellations, there’s an influx of people looking to get a refund for their purchases and new purchases are virtually non-existent. As promoters and teams look for a way to postpone and reschedule their shows and games so they don’t have to give refunds, secondary sites (also referred to as “resale sites” or “scalpers”) can not get their money back from the tickets they’ve purchased, giving them little liquidity to give customers the refunds they are asking for. And since primary sellers like Ticketmaster are not affiliated with these sites, they can not give refunds either.
According to Billboard, secondary sales sites, like Stub Hub, also have a different sales policy when it comes to how money is distributed. Brokers are usually paid at the point of sale instead of after the event, a policy that is now being changed by many of these sites. Stub Hub is now also offering credits for the cancelled events, giving customers 120% of the original ticket price to spend on the site in the future.
Now “sitting on pieces of paper and QR codes that are now worthless” (as the Dallas Observer puts it), these secondary ticketing sites are facing some tough times. Stub Hub furloughed two-thirds of their staff in late March. Another site, TicketNetwork, had to “enact adjustments and cost cutting measures.”
Said ticketing and sales data firm Qcue’s chief executive Barry Kahn to Billboard, “I think some marketplaces are going to go under — it’s similar to what happened with the financial crash of 2008 without the prospect of a bailout.”
“Once the first marketplace falls,” continues Khan, “it’s hard to imagine how brokers and the rest of the marketplaces don’t follow. This crisis is exposing real vulnerabilities in the entire industry.”
However, these secondary ticketing sites are looking for a bailout. Executive director of the National Association of Ticket Brokers Gary Adler is proposing that a number of sellers group together and approach Congress to get themselves added to a bailout bill for the airline and hotel industries. Adler told Billboard, “The number of canceled events due to COVID-19, including some of the biggest that exist, has made it extremely difficult for those in ticketing (and live events in general) to stay afloat. We would like to see ticketing and live events put in the same category as airlines, hotels and cruise lines when it comes to applying relief. Right now, the ticketing industry is essentially at a complete halt with no end in sight. Income for the people working in this sector and providing valuable services to consumers is essential and warranted.”
Not everyone feels this particular side of the ticketing industry needs a bailout. In fact, many wouldn’t mind seeing it die out instead. Resale tickets often cost more than a ticket from primary sellers like Ticketmaster or AXS for the same experience.
As much as they ask, a bailout is very unlikely for these companies. Said an anonymous secondary market consolidator to Billboard , “ticket brokers will do anything to protect their losses, even if it hurts the business long term. That will anger the politicians and make any kind of aid unpalatable.”