Don’t let ticket resale price caps ruin the party this festival season
Misguided plans to cap regulated resale of tickets for live events will be a gift to unscrupulous touts, says Bob Kupbens
The numbers are in – and they’re alarming. Home Office figures just released point to a huge increase in officially reported losses in fraud from ticket sales. And crucially, half of the £1.6m total identified by Action Fraud, which will be the tip of a very large iceberg in the real world, was down to social media scams.
The Home Office is absolutely right to acknowledge the dangers that the Wild West of unregulated resales on social media poses to gig-goers as we continue a summer of amazing live music and events in the UK.
How confusing, then, that the government seems determined to press ahead with its misguided proposals to place a price cap on the regulated resale of tickets for live events.
This move would undermine many of the safeguards the current system has put in place – safeguards that help ensure ticketing remains safe, secure and transparent. It is also a sizeable chunk of red tape on an already highly-regulated sector which desperately needs growth.
And yet this need not be the case. The government already has levers available to it. Enforcing existing laws against automated bulk ticket buying and working with the sector to improve platform standards would all help address fan concerns without dismantling protections and without the need for further legislation.
Indeed, Labour ministers have made clear their desire to spur the economy and reduce regulatory drag. The Prime Minister has spoken of dismantling barriers that hold back the UK’s potential. Supported by the creative industries pillar of its flagship Industrial Strategy, published on Monday, the direction is welcome, but it’s again hard to understand proposals such as a price cap which seem to take us down the opposite path.
The original intention of Labour’s price cap plan was commendable – to make live events more accessible and affordable. But in practice, this policy will undo the very goals it hopes to achieve, driving ticket sales underground into the hands of faceless sellers on social media, strangers outside stadiums or sketchy websites.
Driving ticket sales underground
Like any market, sellers will always sell in the spaces that offer them the best return. So a price cap in one space won’t bring prices down, it will just move sellers and their tickets off legitimate platforms. For consumers, that means no refunds and no replacements, no customer call line – ultimately no recourse when things go wrong, or the tickets turn out to be fraudulent.
Even before the latest Action Fraud revelations, scams were already shaping up as a flashpoint for this government with figures from the Office for National Statistics reporting a 33 per cent increase in fraud in the last year alone. This policy direction would compound this problem, leaving consumers exposed to scammers.
A recent report by Bradshaw Advisory has found that markets with resale caps – such as Ireland and the state of Victoria in Australia experience fraud rates up to four times higher than the UK. If the government was to implement a price cap on ticket resales and similar levels of fraud took hold here, the estimated cost to British consumers could exceed £1.2bn annually.
Banks including Lloyds, NatWest, Santander and Nationwide now regularly flag the growth in ticket scams. Their message is unified – social media platforms and pop-up websites are hotbeds for fraudulent activity.
So in the wake of today’s yet more shocking numbers about the millions lost to dodgy tickets, let’s be super clear – the government has to get this right. Let’s not use blunt regulatory tools that make things worse for fans. Let’s not drive out legitimate and regulated businesses such as ours that provide a safe place to buy tickets. Let’s not entrench the dominance of primary ticketing giants who will have even greater price control. Instead, let’s find a way to make tickets more accessible, make costs more transparent, make the risky routes less appealing.
The UK’s live events industry is world-leading. If we get the balance wrong we risk harming the very essence of the industry: safe and enjoyable events for the fans.
Bob Kupbens is CEO of StubHub International