Examination of Witnesses (Questions 29-39)
MR HARVEY
GOLDSMITH CBE, MR
ROB BALLANTINE,
MR GEOFF
ELLIS AND
MR GEOFF
HUCKSTEP
26 JUNE 2007
Chairman: For our next session can I
welcome Harvey Goldsmith, Rob Ballantine, Chairman of Concert
Promoters Association, Geoff Ellis the Chief Executive of DF Concerts
and Geoff Huckstep, Chairman of the National Arenas Association.
Q29 Philip Davies: If I was a promoter
and determined to stop ticket touts from selling tickets to my
events there are a number of things I would do. I would make sure
that everybody was entitled to a refund, which does not always
happen with every event; I would make sure that my tickets were
available to be purchased in an evening and at unsocial hours,
rather than at a time when people are at work to give people a
proper chance of getting a ticket, rather than not; and I would
make sure that I sold my tickets in blocks so I kept some tickets
still for sale right up to the final week of the event. If you
are so bothered about ticket touting, why is it that many of you
do not do any of those things, because it strikes me that you
really cannot take it that seriously in that case?
Mr Ballantine: We could not be
taking it more seriously, it is our living; it is how we make
money. We are risk-takers; we guarantee income to artists; we
guarantee income to venues; and we have to put money on the table
to market and advertise the events. We want to sell as many tickets
as we can, as broadly as we can; so tickets are on sale 24 hours
around the clock. We would love to offer refunds. What we have
guaranteed to do is, as soon as you give us some help against
touting, we will issue a resale policy, whereby if you cannot
attend the gig you take it back to the point of purchase and we
will put it back on sale once the primary tickets are sold out
so that the customers can come along to a one-stop-shop to buy
the next tickets. Unfortunately what we will refuse to do at the
moment is be a clearing house for touts because, using your analogy,
if I was a tout and refunds were offered I would simply buy as
many tickets as I could to as many concerts, try and flog them
for as great a profit as I could, and any unsold I would go back
to the box office the day before and say, "Sorry, I can't
attend for these 120 tickets I've got, give me my money back".
Q30 Philip Davies: The other thing
you can do is restrict the number of tickets you sell to one person.
Mr Ballantine: We do that. For
example, the Take That tour that caused so much press is very
much about groups of females going out from offices, schools or
wherever in their groups for a night out and you need to be able
to offer them six seats together; and even then we had complaints
that it was not enough. As the BBC TV showed when they were filming
the queues, there were just queues and queues of young teenage
boys who were clearly taking the day off school, bunking off work
and buying up as many tickets as they could to go straight onto
the secondary market. It is very, very difficult to penalise the
public and to prevent the public going to concerts in the way
they want to go to concerts for the prevention of those few percentage
who go with the intention of touting tickets.
Mr Ellis: On blocks of sale it
is quite common for outdoor shows to go on sale with the initial
allocation of tickets and then, once the final capacity is agreed,
more tickets are released closer to the event. With festivals
quite often we have put tickets on sale straight after this year's
event for next year, a limited number, and then we go back into
the marketplace again in February or March. I think we cover all
three of those bases. We have set up with Ticketmaster for T in
the Park Tickets a ticket exchange programme, where again on a
sold out event if somebody genuinely cannot go, or decides they
do not want to go, Ticketmaster will give them a full refund on
their ticket price and then resell the ticket to somebody else
who wants to go.
Mr Huckstep: In terms of access,
the box offices at the venues are open seven days a week until
9pm so most people can access them during the day and after work.
Q31 Philip Davies: This is marvellous
because if I am an ordinary punter, and you are doing all these
things, it means I have got just as good an opportunity to buy
a ticket for an event I want to go to as a ticket tout. You have
made it clear that I have got every opportunity to buy a ticket;
so actually if I do not buy a ticket because I am a genuine fan
but I might be at work and I do not really know that I can go
so I hold off buying a ticket, when I decide I can go to this
performance, under your regime I would be scuppered because all
the tickets would have been sold. In fact touting gives me the
only opportunity I have got to go to that event, because I can
look up and find that somebody is actually selling me a ticket;
and I can make a decision whether or not I want to go to that
event. I can make that choice. If I do not want to pay the price
they are asking that is my choice. Actually touting gives me the
only opportunity I have got to go to your event, because otherwise
it all would have been cleaned out by genuine fans?
Mr Ballantine: The great opportunity
you and the rest of this Committee have is to stop this, because
only you people can stop these touts getting hold of the tickets
in the first place. We have already seen the statistics that 60%
of people selling on eBay sell one or two tickets and that is
it. What is a ticket tout? A ticket tout is an opportunist. A
ticket tout is someone who does manage to get those tickets; and
it is so easy to sell these days because you are marketing to
every single computer in the country by one listing, it is easy
for anyone to become a ticket tout. You say you have missed out
on the opportunity—your option here today is to say, "Okay,
now we understand what this is about let's put a stop to it; let's
not allow these people to tout the ticket; and let's have a fair
distribution to everybody". Because there are only so many
tickets for the pop groups that go on sale; and there are only
so many people who want to see that group. The fact is, we get
those tickets to the fans that want to go; however, with the current
model possibly 40% of them go through the hands of someone who
is marking the ticket price up; but they will eventually reach
the fans who want to go to that concert, and what we are asking
you to do is just eradicate that middle layer. Everything you
have just outlined is there waiting for these fans to buy their
tickets whenever they want by whatever method they want.
Mr Goldsmith: We are a business.
We are here 365 days; we are not just for the odd concert that
you read about in the newspapers causing a furore or just had
huge demand. We are actually a business and we are here all the
time, and we are presenting events and concerts all through the
year to many fans who are real fans of music; they buy the records;
they follow the artists and they come back more than once. They
want to be able to see their heroes and those artists they support.
They do not want to pay inflated prices for them; and we spend
a huge amount of time when we define what our ticket prices are
on how that is made up. It is not just plucked in the air. Ticket
prices are a combination of what the costs are; what the breakeven
point is; what a fair margin is; what we think that act can stand
in the marketplace in a fair way. We are not out to rip-off or
take advantage of our customers. I know it sounds a bit strange,
because in the way you are asking the question you are saying,
"Okay, everybody should be able to resell tickets. They should
do what they want". That is not our business. We are a business;
we are not here to supply parasites who are there to monopolise
and capitalise on what we are trying to do as an industry. That
industry is pretty far and wide. Not only do you see the front
face of it as a concert or what you read about, but remember what
goes into getting those artists to that—the employment values;
the production values; and all the rest that goes in it, that
is what supports our industry. We are not here to create a marketplace
for someone else who puts nothing back and just takes out.
Q32 Philip Davies: Finally, what
evidence have you got to eliminate ticket touting? What evidence
have you got that any government legislation or any ban would
eliminate ticket touting? If we stopped people on eBay selling
tickets are you really na-ve enough to think that would
be the end of ticket touting, and it would not just be driven
underground? Who is going to police this? Are you really asking
that my local police force that are stretched for resources, and
people who ring up with burglaries and cannot get somebody to
come, you are saying that my punters should expect the police
to scrap all their burglaries and their shoplifting and come and
rescue you from the situation you have got yourselves into?
Mr Goldsmith: The police are there
anyway. I went to Wembley Stadium two Saturdays ago and from coming
out of the station—because it was the first time I had been
there and wanted to experience it as if I were regular customer—I
counted 23 policemen with their flak jackets ready for World War
Three, machine guns and God knows what else—Wembley Station.
Walking down the steps, more policemen. I counted about 12 or
14 Wembley stewards also patrolling up and down. Then I was confronted,
at my count, with 43 ticket touts who were harassing people coming
through trying to buy, trying to sell; trying to do some deal;
pushing people, "Can you buy this one". The 23 policemen
were there whether the touts were there or not. All they had to
do was look one stage further and protect the public who genuinely
wanted to go to Wembley Stadium to see a show, who were not there
for a riot and do not want to be harassed by these people.
Mr Ballantine: Actually we were
paying for that police service to be there. No, we are not asking
for the police to police anti-touting. We have said all along
we will do this ourselves within the industry. If you say to the
industry, "Okay touting is now illegal"—as the
IOC demanded that you have done for the Olympics, which is a fantastic
step and should be taken forward with every major event in this
country—if you say that, well, straightaway we are able
to police all these bedroom touts on eBay and the majority of
them will stop because they are not lawbreakers, they are opportunists.
If it is against the law they will stop straightaway. Look at
how many tickets will be touted for the Olympics—hardly
any. No, it is not going to go away completely, we are realists.
We know there is going to be some underground stuff, but at least
if you are buying a ticket from a tout on the street you can see
he has got it; not these fraudsters who advertise tickets, none
of which exist but they are asking for your money.
Q33 Mr Sanders: That is a criminal
offence already. If you put on an act in the Wembley Arena that
could have filled the Wembley Stadium you are going to get touts;
but if you put an act on in Wembley Stadium that could only fill
the Wembley Arena you are not going to get touts, so it is actually
about supply and demand.
Mr Ballantine: Yes, it is but
we are not a supply and demand industry. What we are trying to
do is fill every venue and leave a small demand left over and
hope that we can entice those people either to the next concert
we are promoting, or the next tour that that band are doing. You
would not enjoy a concert if you went along to Wembley Stadium
and there were 10,000 people there because there is no atmosphere.
You have to generate full houses and get the atmosphere going.
It is a very, very careful balance that we do; and we keep those
ticket prices low and affordable to ensure that those venues are
full and full of fans who want to spend their money on concerts;
want to go to ten concerts a year and not two concerts because
it is costing them £250 a ticket.
Mr Huckstep: You are assuming
that all the secondary agents are genuine sellers—they are
not. Up and down the country the National Arenas Association covers
venues from Aberdeen and Glasgow, down to London, Brighton, Birmingham,
Sheffield and Nottingham. At every show we have issues with people
who turn up who have bought tickets through the secondary market,
whether it is eBay, tickettout.com, World Ticket Exchange. We
have the problems on the night when these people have turned up,
often having travelled hundreds of miles and their ticket is not
valid; or the guy has not turned up; or it is in the wrong seats.
I can tell you now, going to an event is an emotional thing for
young people. If they cannot get into that show and you know they
have got a ticket and you have to deal with that on the night,
as we have to, I can tell you now that is not a very pleasant
experience. It also deflects my staff away at Nottingham from
dealing with genuine people that need customer services. You are
actually assuming that the secondary market is a genuine market
and it is not. It is full of fraudulent people.
Q34 Helen Southworth: In those terms
then what would you recommend in terms of the code of conduct
for resales?
Mr Ballantine: For a resale what
we are planning to do, what we cannot do is offer complete refunds.
For example, Glastonbury last weekend, a £20 million outlay
to build a site, pay the artists, get everything ready, torrential
rain the week before; ten thousand people probably would claim
they had a relative die or something meant they could not attend
and they would ask for a refund; that would make the Glastonbury
organisation go bust. That is £1.5 million they need to refund
and people do not make those sorts of profits. That festival would
end overnight. We therefore cannot issue complete refunds for
people who simply change their minds because we build the event
depending on the ticket sales. Once a promoter guarantees the
artist and the venue the money, then the artist goes and designs
that tour, the expenses are taken on and that money is on the
table. If then the customers come up and ask for a refund two
days before and you have not got a chance to resell them that
is where promoters would be going bankrupt left, right and centre.
What we will offer though is a resale policy if you cannot attend
the event for whatever reason, as soon as there is any sort of
legislation to help out because otherwise we are simply going
to be acting as a clearing house for touts.
Q35 Helen Southworth: Just give us
the detail of what this policy would contain at some point in
the future then?
Mr Ballantine: The customer goes
back to the point of purchase where they bought their ticket from
and says, "I can't attend the gig. There's my ticket back".
You should get the full face value back because the ticket will
be offered for resale; so as and when tickets are sold out all
your tickets go on sale. Consumers who have not got tickets then
only have to check with the primary ticket agent—usually
the venue box office so they do not have to go through viagogo
and Seatwave and eBay, and all these people making an extra layer
of margin out of it. They go back to the primary point of sale
always and they can ask exactly where the ticket is located.
Q36 Helen Southworth: But you would
only do that when all your other tickets had been sold?
Mr Ballantine: Of course, that
is the only model we can support, otherwise the touts are just
going along and they will buy a load of tickets and when they
do not sell them they will take them all back to us. We cannot
finance that. It is bad enough having to cope with touts in the
market now, let alone us being the clearing house for them and
financially supporting them.
Q37 Helen Southworth: Is that an
industry agreement?
Mr Ballantine: Yes, absolutely
everybody. You have seen the letter we put in, I hope. I have
never seen so many signatories come from so many competing parties,
all united. The strength of feeling of this is incredible out
there. It is absolutely unbelievable. The industry feels that
this is a real turning point for us, and we are desperately trying
to hold on to our members. We do not operate like the RFU or Wimbledon,
who commendably look after the schools. The CPA are a bunch of
individual entrepreneurs and we are trying to hold everybody together
until we get through this process before our members say, "I'm
sorry, but I've had enough of everybody else making profits on
the secondary market. We are now going to auction percentages
of our tickets". Those promoters will just explode onto the
market and replace the touts that are selling on the secondary
market, and the public is going to lose out hugely. That is why
we have come here today to say, "Please protect the public
from what is an inevitable economic explosion".
Mr Goldsmith: In essence, I guess
I am stating the obvious, but we are the people who are investing
in our industry. We are nurturing the talent right the way through
to hopeful success where there is that kind of demand. Equally,
we have to have a balance. All alongside our industry, as I said
before all the people employed alongside it, we also nurture and
develop. We do consider ourselves to be a professional body and
we are genuinely trying to deal with this. Not only is it affecting
the genuine music and sports fans but, as you well know, in the
West End with theatre tickets, people are coming in from all over
the world and part of their experience is to go to the West End
and go to events, even to go to the very popular art exhibitions,
and what they are faced with is this whole secondary touting market.
It is doing all of us a disservice.
Q38 Helen Southworth: At the moment
people could say that your market is what is creating the markets
for touts?
Mr Ballantine: Yes, because we
have priced realistically.
Q39 Helen Southworth: Your market
is currently creating that market. Why should not fans who cannot
use tickets currently be offered a resale just because touts might
be interested?
Mr Ballantine: They are. Traditionally
over the years we have always given refunds to fans. We cannot
openly say it but when people come back for genuine reasons, do
we give refunds? Yes; especially on sold out shows because we
know we can get rid of the tickets straight away. There are ticket
exchange mechanisms out there; there are ticket refund mechanisms
out there; what we are saying is, "Let's end all this confusion.
We are going to go with one resale policy that every single member
will sign up to". It is going to be out there and published
that every ticket will be sold with a stamp from the Society of
Ticket Agents and Retailers (STAR); so we are hoping that STAR
will become as well known as ABTA amongst consumers, and consumers
will know to only go to a STAR agent. Where you say that we are
creating that market, I do not know how many of you have heard
of The Fratellis, how many of you have heard of Muse, how many
of heard of The View; however, you have all heard of the Arctic
Monkeys. This is a band that has got this huge media hype going
on around it: does that give us the right, therefore, to charge
£60 for the Arctic Monkeys' tickets because everybody knows
about them and there is this huge media hype? We are promoting
them outdoors in a couple of weeks time: £28.50 for a ticket.
That is not market value but the band have only just released
their second album; they know they have got to reward those fans
who have been following them around the clubs paying £7.50
and £12.50 building them up to the place where they have
one of the biggest selling albums of last year in the country.
Those fans need to come along and feel that they have had genuine
value for money. They are getting five bands for £28.50 and
probably one of the greatest concerts this summer. We know we
could have charged three figures for that, but those fans would
then not necessarily come back. They will say, "Well, it
was alright but it wasn't worth a hundred quid", and the
damage is done.
Mr Ellis: Sustainability is very
important for our business because we are developing new talent
as well as the Arctic Monkeys. We are bringing along the next
Arctic Monkeys. We need music fans to have enough money to go
and see the club show that might only be £5, £6 or £7
and is not sold out. We need money out there in the marketplace
to support that, as do the sporting bodies. The economic impact
is also greater; if somebody can attend six concerts at £30
rather than one concert at £180 a go, they are going out
more often and therefore they are spending more money, and therefore
there is the drip-feed factor throughout the tourism industry
as well.
Mr Huckstep: Can I just endorse
what Geoff has said there. It costs a fantastic amount of money
to build these things, we have seen it with the Wembley Stadium.
The Nottingham Arena was £43 million of local investment,
city council investment and Sport England investment. That has
got to be sustained. We rely on the concert promoters to bring
us regular business. If the fans were priced out of the market
then the future for Nottingham Arena and other arenas is very
much in doubt.
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