Ontario pitches new rules to crack down on ticket scalping and bots

The Ontario government plans to introduce new rules this fall that would crack down on scalping tickets for sports, concert and other events at inflated prices.

Proposed legislation would outlaw scalping bots, but few details available

Ontario Attorney General Yasir Naqvi says the new rules that the government plans to introduce this fall would make Ontario a world leader in terms of getting on top of ticket scalping. (Chris Young/Canadian Press)

The Ontario government plans to introduce new rules this fall that would crack down on scalping tickets for sports, concert and other events at inflated prices.

The new legislation would target resellers who used technological and other means to buy the majority of tickets, Attorney General Yasir Naqvi  told reporters outside Toronto's Rogers Centre on Monday morning.

Naqvi said scalpers commonly use bots — software that is "designed to buy as many tickets as possible in seconds."

"By the time any fan is able to log on, the best seats are gone. Many events sell out in minutes, even seconds, and many of these tickets end up on reselling sites for a huge markup."

Naqvi said that if passed, the new rules "would make Ontario a world leader in ticket sale regulation." Here are more details of what they'd include:

  • Cap the resale ticket markup at 50 per cent of the face value, to reduce the incentive to buy tickets for resale at higher prices.
  • Proposing a ban on scalper bots. "It will be illegal to sell bots, use bots or use tickets sold by bots," said Naqvi, without elaborating on how the province proposes to achieve that technological feat.
  • Create transparency by requiring ticket sellers and event organizers to disclose the number of tickets available in a sale, as well as the total capacity of the venue. They would also be forced to include all fees up front. Resellers would be required to disclose the original face value of the seat, as well as its location.
  • Introduce new enforcement tools — including higher fines and penalties, and more inspectors — to ensure the new rules are being followed.

Lack of transparency

While bots draw the ire of fans, some experts in the field say the real problem isn't technology that's faster than people: it's that not all the tickets available for an event are ever sold in a general sale.

A 2015 report from the New York attorney general's office calculated that barely half of the tickets available for any given event ever get sold to the public. The majority were either given to insiders connected with the venue or artist, or reserved for pre-sales — where scalpers tend to feast, former scalper Ken Lowson says.

Lowson knows of what he speaks. His former venture, Wiseguys Tickets, made more than $25 million in the early 2000s reselling tickets to major events, before being indicted for conspiracy to commit wire fraud by the FBI in 2010.

Today he's using his skills and insider knowledge on the other side, to level the playing field for fans via a new venture, Tixfan.com. And bots aren't the biggest obstacle standing in the way of fans who want tickets, he told CBC News in an interview Monday.

"Bots are only getting the [worst] seats in the public sale," he said "The good ones are held back for pre-sale and insiders ... and the pre-sale system is corrupt," Lowson said.

Only a small percentage of tickets ever make it to the general public, Lowson said, and while bots are always going to be faster than humans at hoovering them up (a single bot purchased more than 500 tickets for a Beyoncé show in under 3 minutes in New York in 2013, the AG report found) they are far from the biggest problem.

But they're an excellent scapegoat for everyone involved, Lowson said. Artists are reluctant to charge exorbitant prices because that alienates fans, he said. "Artists need somebody to blame so they blame Ticketmaster, and Ticketmaster blames scalpers."

"Scalpers make the bots the bad guys," he said but the real guilty party is a lack of transparency. "If we knew what ticket was being sold to who at what price, they'd lose their business," he said.

Capping the mark-up at 50 per cent could have the opposite effect to what the law is intending, Canadian music publicist Eric Alper says. (CBC)

Music publicist Eric Alper agrees that it's a tricky problem to solve, but in particular questions the wisdom of capping the markup at 50 per cent of the face value.

"It will only make scalpers work twice as hard in order to keep their profit margin the way that they were last year," he told CBC News. "It's not like that suddenly they're just going to lie down and roll over."

"I'm not convinced that this is going to be effective," Alper said.

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.