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(KMSP) - Michael Bishop is what you might call a concert super fan. Last year he attended more than 82 music shows, everyone from Pink to Bruno Mars and a little bit of country too.
But when it comes to the hottest concerts, like tickets to Justin Timberlake’s first show, September 28 at Xcel Energy Center, he’s always left out in the cold.
“10 a.m., I clicked refresh, and all the tickets were gone,” said Bishop, who had joined the Justin Timberlake Fan Club the week before, but was also locked out of the pre-sale.
“Since I’ve lived in Minneapolis, I haven’t gotten one ticket on the primary market,” said Bishop. “I go to StubHub, or something else, and pay two to three times as much.”
When he wanted to see Lady Gaga last December, Bishop said it was cheaper for him to fly to Denver, where ticket scalping is illegal, to see her in concert. Ticket scalping, also known as the secondary market, is legal in Minnesota.
Bishop was hardly the only person who had difficulty getting Timberlake tickets. Even the pros had a hard time.
“We’re professionals, this is what we do for a living, and even we had a hard time getting tickets,” said Michael Nowakowski, owner of Ticket King, a popular broker in the secondary market.
ANATOMY OF A ‘SELL OUT’
Timberlake’s first show for Friday, September 28 at Xcel Energy Center in St. Paul, was an almost instant sellout when tickets went on sale to the general public. Xcel Energy Center has a concert capacity crowd of about 19,000.
But just as quickly, there were more than a thousand tickets available immediately for re-sale in the secondary market at a huge mark-up.
A floor ticket, with an original face value of $178, was selling for as much as $268 after the sellout. Even a $52 nosebleed seat was more than double, at $125.
And the seats closest to the stage, an area concert promoters call "The Golden Circle," were being sold as VIP Tickets for as much as $8,000.
A second Timberlake show on Saturday, September 29 at Xcel Energy Center, was announced after tickets for the first show “sold out" -- just hours after ticket sales opened up to the general public.
BOTS BEAT YOU TO THE PUNCH
Ticket King told the Fox 9 Investigators they get their tickets by having their staff go online.
But other brokers use computer programs known as "bots," that flood and overwhelm the system by placing multiple orders on hold and gobble up the best seats while fans are left hitting refresh on their computer.
A recent investigation by New York’s Attorney General, “Obstructed View: What’s Blocking New Yorkers from Getting Tickets,” called buying concert tickets “a fixed game.” The study analyzed some of New York’s biggest concerts and found 20-30 percent of the best seats will be sold on the secondary market, where consumers will pay, on average, 49 percent more.
But that New York investigation found concert promoters share the blame, by carefully calibrating the supply of tickets.
Less than half the tickets, 46 percent, are reserved for the general public, the study found. Sixteen percent are ‘holds’ for industry insiders, promoters, and corporate sponsors.
The study found, on average, 38 percent of the tickets are “pre-sale,” for credit card holders or fan club members. And with some performers, like Jay-Z, Timberlake and Coldplay, up to 70 percent of the tickets are held for pre-sale, the study found.
‘JUST TELL PEOPLE THE TRUTH’
“It just comes down to transparency,” said Nowakowski of Ticket King. “Just tell people the truth. Just tell people how much the tickets are going to be, how many are going on sale for the pre-sale, how many are going on sale for the general, and let people see if there’s a value for that price.”
Most of the biggest concerts in the Twin Cities are played in venues that were built with taxpayer money.
The Minnesota Wild rent Xcel Energy Center from the City of St. Paul. For concerts, they have an exclusive agreement with the promoter, Live Nation, which also owns the ticket distributor, Ticketmaster.
Ticketmaster has now become a big player in the secondary market, making $1.2 billion last year from re-selling tickets, a 34 percent increase from the prior year.
To see how they make that money, one needs only to look at section 116 of the first, sold out Timberlake show on Ticketmaster’s re-sale web site. Seats denoted as pink dots are re-sales, that Ticketmaster will collect more than $150 on transaction fees. The blue dots are so-called "Platinum Tickets," indistinguishable from the seats right next to them, that Ticketmaster admits are “dynamically priced to go up and down.”
A WHIFF OF DESPERATION
“They are trying to create a frenzy, getting everybody to rush, and trying to get publicity,” said Economics Professor Pascal Courty, of the University of Victoria.
Professor Courty is an expert on the pricing of tickets, who has studied the secondary market since he was a graduate student at the University of Chicago. He told the Fox 9 Investigators the truth about concert tickets is counterintuitive: the hottest tickets are priced too cheaply to begin with.
“I think it's undeniable some events underpricing plays a role, like Hamilton or Ed Sheeran,” said Professor Courty.
There is some psychology at work among the artists, said Courty. On the one hand, no artist wants to be labeled as greedy and a performer can build loyalty by keeping prices low.
Ironically, an artist like the late Tom Petty, who kept prices low, was also a scalper's dream. That’s because the ticket price for his shows did not reflect the true market value of the ticket. Petty also played smaller venues which choked supply.
The classic case of "low price/high demand," is the Super Bowl, recently played in Minneapolis at U.S. Bank Stadium.
“Even though the printed price is very high, it’s not as high as you could get in the secondary market,” said Prof. Courty.
U.S. professional sports leagues, who have long complained about the secondary ticket market, have now created their own secondary ticket sites.
“They said, ‘If you can’t beat ‘em, join ‘em,’” said Prof. Courty.
The NFL and Minnesota Vikings have a secondary ticket site for season ticket holders through Ticketmaster. The Twins have partnered with Stub Hub, a secondary broker. The Minnesota Timberwolves have Flash Seats through AEG, which manages Target Center. A spokesperson for the Timberwolves told Fox 9, 86 percent of their fans now use tickets connected to their credit card and smart phone to get into Target Center.
For their latest shows in the Twin Cities, U2 and Bruce Springsteen also used paperless tickets connected to credit cards and smart phones.
But lobbying groups, like the National Association for Ticket Brokers, and Fan Freedom, say paperless tickets only hurt consumers when they want to pass a ticket on to a friend, but the friend can’t get admission because the ticket is linked to their credit card.
NO ONE HATES IT, ENOUGH
“The free market seems to be working,” said State Rep. Joe Hoppe (R) Chaska.
In 2007, the Minnesota legislature legalized ticket reselling, or what is generally referred to as scalping, with no regulations. There is no law requiring brokers to be licensed in Minnesota, or limiting how many tickets promoters can hold back. Likewise, there are no laws regarding exorbitant fees in the primary or secondary markets.
“I think it's one of those things where no one likes it, but no one hates it enough to really complain about it too much right now,” said Rep. Hoppe, who believes lawmakers are on the sidelines, caught between brokers, promoters, and consumers.
“Most people wind up getting tickets on the secondary market. When a concert sells out in 15 seconds, realistically, not many people who attend the concert are getting them right then,” said Rep. Hoppe.
FROM DESPERATION TO ‘MEH’
Ironically, the Justin Timberlake concert, which started out with such desperation among fans, appeared to have fizzled with the second show.
Only a dozen or so fans showed up at the Xcel Energy Center box office when tickets for the second show on September 29, went on sale to the general public. One fan told Fox 9, “The only tickets available were super expensive.” Fans said they couldn't find more than single tickets available for the most inexpensive sections.
This weekend, Live Nation/Ticketmaster released hundreds of Platinum Tickets on to the market, at close to the original face value.
“They’re their tickets, they can do what they want, but it's gotten to the point the average fan can’t get a ticket," said Nowakowski of Ticket King. "Not just a good ticket. Just can’t get any ticket."
As for Michael Bishop, the super concert fan, he eventually got tickets on the secondary market, but the experience has left him disillusioned.
“It’s ridiculous,” said Bishop. “The whole point of having a concert is so fans can see their favorite entertainer, but no one can afford $1,600 a ticket.”