Last month the Labour Party announced that, if it forms the next UK government, it will put a price cap on the resale of tickets online. Last week, by pure coincidence I'm sure, Cris Miller - boss of the often controversial ticket resale platform Viagogo - was busy giving interviews to the UK media insisting that price caps don't work. Those interviews occurred amid reports that the US-based Viagogo business is now plotting to become a publicly listed company in a $16.5 billion IPO.
Anti-touting campaign FanFair was among those to note that Miller was in talkative mode “after years of evading the media”, telling CMU, “It's been fascinating to read the thoughts and opinions” of the Viagogo chief. Referencing the IPO rumours and the recent convictions relating to a professional touting operation that sold tickets on platforms like Viagogo, it added, “These developments should result in even greater scrutiny of Viagogo's business practices”.
Under Labour's proposal, anyone reselling a ticket online would only be able to charge a maximum of 10% more than the face value of the ticket. Echoing comments made earlier in the week on Radio 4's 'Today' programme, Miller said in an interview with The Observer this weekend that, “What happens with price caps is that the highest-demand part of the market, where you might see prices go above the original price, will just get driven underground”.
That's a key argument that has been employed by Viagogo and other secondary ticketing platforms for years now, basically whenever any kind of regulation to ticket resale is proposed.
The argument goes that if bespoke ticket resale sites are over-regulated - or subject to price caps - the touts will use social media or internet forums to sell tickets, and on those sites there will be less protection against all-out fraudsters who don't actually have any tickets to sell.
Viagogo argues that it has checks in place to counter that kind of fraud, not least its guarantee to refund the customer if they do not receive a ticket from a seller or if a ticket fails to get them into a show.
In his Radio 4 interview, Miller honed in on Australia - where a touting price cap is already in operation - and Ireland - where for-profit resale has been banned altogether. He claimed that when Taylor Swift recently played shows in Australia over 260,000 fake tickets were reported, while in Ireland banks last year issued warnings over a rise in ticketing scams.
In response to that specific argument, Adam Webb from FanFair told CMU, “Viagogo's claims that price caps drive touting underground or onto social media are completely unfounded. Regardless of legislation, a significant volume of ticket resale already takes place across the likes of Facebook and Twitter”.
“For instance, last November, Santander reported that ticket fraud in the UK had doubled in the past year. Similarly, the Australian Taylor Swift ticket scam referenced by Viagogo appears to be the result of opportunists and fraudsters operating across social media. I can see no evidence linking these activities with price caps”.
“Aside from cracking down on the exploitative practices of Viagogo's biggest suppliers”, they added, “our aim in the UK is to further develop the consumer-friendly resale market - so that fans can easily resell any ticket they've bought to another fan, for the price they originally paid or less”.
Of course, a government forcing a price cap onto resale platforms doesn't mean it can't also seek to crack down on ticket fraud. Indeed, if the UK's Competition & Markets Authority and National Trading Standards didn't need to spend time checking Viagogo and its sellers are complying with the existing touting regulations, they could invest more time in tackling the fraud.
Plus, despite trying to position itself as the champion of the consumer, Viagogo has a long history of employing tactics to confuse and trick ticket-buyers, while there has been plenty of criticism over the years by customers who have sought to utilise its refund guarantee.
Regulation in some countries, including the UK, has forced it to abandon some of those tactics. And in his Observer interview, Miller was keen to stress his company now complies with those kinds of rules. “The compliance thing is very, very important to me”, he stated.
Quite how damaging a touting price cap in the UK would be for Viagogo isn't clear. Though The Observer reports that the resale site “takes commissions of about 25% or more on the price of every ticket it sells in the UK, where it dominates a market which had an estimated value of £350m in 2019”.
Obviously, Viagogo will lobby hard against any new law that could have a significant impact on its UK revenues. The fact that the Viagogo company - which merged with the US business of its main rival StubHub in 2020 - is now plotting an Initial Public Offering will make the Labour Party's plans all the more concerning.
CNBC reported last week that Viagogo/StubHub is working with JPMorgan and Goldman Sachs on an IPO that could go ahead later this year seeking a valuation of $16.5 billion.
Nevertheless, organisations like FanFair will lobby hard to get Labour's proposal implemented. Miller's new interviews, FanFair said, are interesting “in light of the recent court case in Leeds, where individuals who unlawfully resold tens of thousands of tickets through secondary ticketing websites, including Viagogo, were convicted of multi-million pound fraud offences, as well as the reported IPO being planned by Viagogo's US parent company, StubHub”.
“These developments”, it added, “should result in even greater scrutiny of Viagogo's business practices, and their complete dependency on large-scale ticket touts. I hope they also provide greater confidence for politicians and regulators to intervene in this sector and to introduce new legislation that will protect consumers from exploitation”.
