Lauren Smiley cut back on big-name concerts after bots gobbled up her presale tickets to both Brandi Carlile and Caamp. Jonathan Kahn stopped building out his Red Rocks season ahead of time because AXS, the primary ticket seller for Red Rocks, changed their resale platform, making it harder for him to recoup costs if he couldn’t attend a concert. Johnny Joy, a former concert promoter, has all but ditched Denver concerts for his own home venue, outfitted with four screens and two surround sound systems.
Whether it’s getting elbowed out by bots, surfing scammy websites or getting slapped with last-second service fees, people are fed up with the way tickets are sold, and it’s changing the way they attend events.
A bipartisan bill could address some, but not all, of those concerns.
House Bill 1378 passed the legislature on Monday, leaving it up to Gov. Jared Polis to sign or veto.
We’ve been here before. Last year, Polis vetoed Senate Bill 60, a proposal to rein in deceptive ticketing practices by imposing fines up to $2 million on fraudulent ticket sellers and operators that use bots. The measure also would have prevented ticket sites from sneaking service and convenience fees into a concertgoer’s cart.
Secondary ticket sellers like StubHub and consumer protection groups like the Sports Fan Coalition were among those who lined up in opposition to Senate Bill 60. They took issue with a provision that would have allowed operators to revoke season tickets for reasons “relating to a violation of venue policies,” according to the bill’s text.
The groups worried that granting operators that right would indirectly open a loophole that Ticketmaster could slide through to shut down their competitors by insisting that venues refuse tickets bought on the secondary market. They argued that consumers would get caught in this competitive crossfire, with one testimonial on the Senate floor calling the bill “a Trojan horse” for Ticketmaster’s interests.
In vetoing the 2023 legislation, Polis said he agreed with the loophole concerns and asserted that it didn’t go far enough to protect consumers.
House Bill 1378 bill includes many of the same provisions as last year’s measure, including mandatory upfront disclosure of fees, but it’s slimmer than its predecessor, with legislators dialing back their definition of deceptive practices, simplifying the language around ticket fees and omitting any mentions of penalties for those who don’t comply.
What the bill would do
The first change that consumers may see is more transparent ticket prices.
Service fees and so-called convenience fees would have to be shown with the original ticket price, though delivery fees for paper tickets and sales tax could still be tacked on later.
“All-in pricing is what fans want the most. They want to be shown one number and they don’t want that number to change,” said Brian Hess, executive director of the Sports Fans Coalition, which worked with lawmakers on drafting the new bill.
All-in pricing, or showing the consumer the total ticket price upfront, has been tested before. In 2013, StubHub, the nation’s largest ticket reseller, decided to include its 15%-17% service fees in the initial ticket price.
The experiment lasted two years, during which StubHub’s market value declined sharply.
Before the company completely reverted back to “drip pricing”— in which fees are added later in the purchasing process — they split consumers into two groups. Half were shown a website with all-in pricing, and the other half checked out with drip pricing.
The results confirmed what StubHub, ticket sellers and marketing professionals had hypothesized all along: Consumers are more likely to purchase tickets from a site that shows a lower upfront cost, regardless of how much fees jack that price up.
A second, more subtle conclusion was drawn from an additional study that looked at StubHub’s data: Not only were people more willing to spend money on tickets with hidden fees, but they were more likely to buy higher quality tickets — those closer to the stage or the field — since the original prices appeared lower.
“That is evidence that the market is broken, right? The company doing the right thing by its customers lost money,” Hess said. “The only way (forward) is if all market participants are required to do all-in pricing. That would level the playing field and allow consumers to adequately price shop for tickets.”
StubHub and the Sports Fans Coalition were vocal opponents of last year’s bill, with Hess contributing to an op-ed in the Denver Post and representatives from both groups testifying against it in the Senate. But the groups did not oppose this year’s bill, despite the lack of any new rules against bots or ticket holdbacks — two of the biggest concerns raised last year.
“This is a compromise bill,” Hess said. “All parties would like more.”
The bill would also guarantee event entry to anyone with a valid ticket, regardless of whether they bought the ticket on the primary or secondary market. This is a potential win for ticket resellers like StubHub, and a reversal of the most contentious part of last year’s bill, proposing that venue operators be permitted to revoke tickets.
What the bill would not do
The bill wouldn’t affect the widespread use of bots, which have been technically illegal to use since the federal government enacted the BOTS Act in 2016, though the law has only been enforced once in its eight year history. The question of who is responsible for regulating bots is mostly unanswered.
In January, during a U.S. Senate Judiciary Committee hearing on competition in the ticketing industry, executives of Live Nation — the parent company of Ticketmaster — claimed that bots were responsible for the widely publicized ticketing meltdown ahead of Taylor Swift’s “Eras” tour. (The U.S. Department of Justice has since announced its intent to sue Live Nation over monopolistic control of the industry).
U.S. Sen. Marsha Blackburn of Tennessee grilled the Live Nation executive about the $20 billion company’s inability to protect consumers — and apparent unwillingness to report bad actors to the Federal Trade Commission.
This year’s state bill does not require bot reporting, nor does it include any financial penalties if the rules it describes are broken.
It also leaves “holdback” ticketing on the table, the practice of releasing tickets in batches to create a false sense of scarcity.
Part of the lawmakers’ goal in reshaping the bill was to create something that avoided igniting “the most intense corporate passions of the Ticketmasters of the world by going after that holdback provision,” said Representative Alex Valdez of Denver, one of the sponsors of the bill.
Put more bluntly, holdbacks are “the primary market secret sauce,” Hess said.
The lack of bot enforcement and allowance of holdbacks were major sticking points in last year’s bill, and eventually the provision that required venues to report suspected bots was scrapped from the final draft. Polis lamented this omission in his veto letter.
And while disclosing the total cost of a ticket is a win for transparency, the bill wouldn’t actually prohibit ancillary fees, which average around 27% in primary markets and 31% in secondary markets, according to a 2018 report by the U.S. Government Accountability Office. So you could still get hit with service fees — they’ll just come as less of a surprise.
What would remain unchanged
Some of the biggest issues in event ticketing are still on the table. Bots are still botty, fraudulent websites are still fraud-y, and service fees aren’t going anywhere. And even though a venue won’t be able to turn you away if you unknowingly purchased a fake ticket, they can still kick you out if you violate their policies. Meaning that if you try to sneak a hula hoop or a bag of glitter into Red Rocks, security is coming for you.
Ultimately, the bill is viewed by most as a launchpad for stronger protections, and a temporary arrangement until federal-level protections are put into place.
“We’re seeing movement at the federal level to hopefully get to a federal standard. So bills like this in Colorado may not be necessary in the future,” said Stephen Parker, executive director of the National Independent Venues Association. “But for now, the states are where the action is at. And ultimately, if there’s gonna be consumer protection, it’s gonna happen at the state level. The only question is: Is the consumer protection meaningful?”