Close this menu

Going Paperless: When Innovation Leads to Frustration and Secondary Market Foreclosure

You can resell your townhouse, Toyota, or textbooks online. But there’s one product, that thanks to new technology, can’t be bought and resold–Ticketmaster’s so-called “paperless tickets”.


That almost anything can be bought and resold is a benefit to consumers, particularly in tough economic times. But under Ticketmaster’s paperless tickets policy, instead of getting a paper ticket (or an email that you print up at home) you have to present 1) the credit card used to purchase the tickets, and 2) a government-issued photo identification for admittance. Paperless tickets have been used throughout the recent Miley Cyrus tour this year. She performed at the Verizon Center last month in Washington, DC and a local news story reported on the hardship it created for many fans:


A photo ID is also required, meaning Talia Levin couldn’t just take her mom’s credit card to the concert. Her mom had to swipe her through. “If you are older, then you can go by yourself, so it’s hard to have to go with your parents,” stated Talia Levin. “I refuse to buy into any artist who does this ever again,” said Talia’s mom, Melanie Levin. “I won’t do it.”

Thanks to this new “innovation” we now have consumer frustration. What if I wanted to go online to buy concert tickets for my parents as a Christmas Gift? Would I have to go down to the arena to get them in–down in Atlanta??  What’s up with that? It’s an online transaction so I should be able to go online and determine who’s got permission to pick up these tickets.


But even if Ticketmaster figures out the logistical headaches, there’s still a serious problem:  consumers can’t resell their tickets! An editorial in the LA Times does a good job of describing who really benefits from paperless tickets–two points if you guessed “Ticketmaster.” They control the primary market, and now the company wants to control the secondary market too.


This control will turn into a death grip if Ticketmaster (the largest ticket distributor) merges with LiveNation, (the largest promoter) to create one giant company. As a merger condition, DOJ should require Ticketmaster to give customers control of who can pick-up their tickets. This is the best way to preserve the secondary market without prophylactic regulation. If not, Congress will need to look at maintaining customer control and convenience in a post-merger “Ticketmaster Nation”.