In a progress update following widespread complaints about the sale of Oasis concert tickets, competition regulator the Competition and Markets Authority (CMA) has backed Ticketmaster’s account that it did not employ dynamic pricing for the reunion shows.
Following concerns about the ticketing process for Oasis stadium shows on sale last August, there were widespread claims that Ticketmaster used an algorithmic pricing model to adust prices – so-called dynamic pricing.
The experience of fans – who reported prices increasing from £135 to more than £350 each in the online queue – became headline news and even prompted the government to take up the cause against the use of such surge pricing, which was included in the ongoing ticketing consultation.
However, the suggestion that the ticketing giant was increasing prices in real time on the day in response to soaring demand was recently refuted by Ticketmaster’s Andrew Parsons at a committee hearing of MPs. The MD of the UK company stressed that prices were not altered during the sale process, despite anecdotal evidence from fans that they ended up paying more than expected.
“We don’t change prices in any automated or algorithmic way,” Parsons told MPs in February. “Prices are set in advance with event organisers and their teams at the prices that they want them to be available. I think in certain instances, because of that fact, some of the cheaper tickets which may be available will inevitably sell through most quickly, meaning that the tickets that the fans see at a later date will be at a higher price, which can give the illusion that those tickets have changed price. But they have not – we can be very clear that there’s no technology that’s driving any price change.”
As an explanation, that seemed pretty straightforward.
The Competition and Markets Authority (CMA) has now accepted the Ticketmaster response to the row over the Oasis ticket sales.
But while dynamic pricing was not the reason for fans’ frustration on the day over the apparent changing prices, the CMA still has concerns about the availability of information on the cost of Oasis tickets to stadium shows including Wembley, which take place this summer.
“Many fans were under the impression that Ticketmaster used an algorithmic pricing model during the Oasis sale, with ticket prices adjusted in real time according to changing conditions like high demand,” said the regulator. “The CMA has not found evidence that this was the case. Instead, Ticketmaster released a number of standing tickets at a lower price and, once they had sold out, then released the remaining standing tickets at a much higher price.”
Music Week understands that Ticketmaster UK does not use dynamic pricing (including algorithmic, differential or surge pricing) and has welcomed the fact that the CMA appears to have dropped this from their investigation.
In a statement, Ticketmaster UK said: “At Ticketmaster, we strive to provide the best ticketing platform through a simple, transparent and consumer-friendly experience. We welcome the CMA’s input in helping make the industry even better for fans.”
Following a formal investigation, the CMA is now consulting with the ticketing platform on changes to ensure fans receive the right information, at the right time.
The CMA is concerned that Ticketmaster, which sold more than 900,000 tickets during the Oasis ticket sale, may have breached consumer protection law by:
• Labelling certain seated tickets as ‘platinum’ and selling them for nearly 2.5 times the price of equivalent standard tickets, without sufficiently explaining that they did not offer additional benefits and were often located in the same area of the stadium.
• Not informing consumers that there were two categories of standing tickets at different prices, with all of the cheaper standing tickets sold first before the more expensive standing tickets were released. This resulted in many fans waiting in a lengthy queue without understanding what they would be paying and then having to decide whether to pay a higher price than they expected.
We’re concerned that Oasis fans didn’t get the information they needed or may have been misled into buying tickets they thought were better than they were
Hayley Fletcher
“Although prices were not adjusted in real time using an algorithm, the CMA is concerned that consumers were not given clear and timely information about how the pricing of standing tickets would work, particularly where many customers had to wait in lengthy queues to see what tickets were available,” said a statement.
“Since the opening of the investigation, Ticketmaster has made changes to some aspects of its ticket sales process, but the CMA does not currently consider these changes are sufficient to address its concerns.
“The CMA has provided Ticketmaster with details of the further steps required to address its concerns and is seeking changes to Ticketmaster’s processes – including to the information it provides to customers, when it provides that information, and how it labels some of its tickets. The CMA is now consulting on these changes with Ticketmaster.”
Hayley Fletcher, interim senior director of consumer protection, said: “Fans reported problems when buying Oasis tickets from Ticketmaster and we decided those concerns warranted investigation.
“We’re concerned that Oasis fans didn’t get the information they needed or may have been misled into buying tickets they thought were better than they were.
“We now expect Ticketmaster to work with us to address these concerns so, in future, fans can make well-informed decisions when buying tickets.”
“All ticketing websites should check they are complying with the law and treating their customers fairly,” added Fletcher. “When businesses get it right, consumers benefit – and that’s the best outcome for everyone.”
We strive to provide the best ticketing platform through a simple, transparent and consumer-friendly experience
Ticketmaster
Although the dynamic pricing model was not employed in this case, it has now got negative connotations in the UK live sector. The coverage of Ticketmaster may also reflect the antitrust legal action in the US against parent company Live Nation, and general concerns about the market power of the live music giant. Dynamic pricing has been a key element of the case against Live Nation in the US, with the DOJ seeking to break up Live Nation and Ticketmaster.
A statement from Oasis following the ticketing row did acknowledge discussions with management, promoters and Ticketmaster over "dynamic ticketing to help keep general ticket prices down as well as reduce touting". Yet, as the CMA found, the issue was apparently less to do with algorithms and more about the information available to fans on prices for different tickets.
Dynamic pricing has been more widely adopted in the US, although artists including The Cure and Neil Young have come out against it – as did Oasis in the wake of the UK ticket sale.
However, as Parsons outlined at the Parliamentary hearing, a version of the model can be used to reduce prices to boost sales for shows that are not selling out. He also noted that 90% of shows sold via Ticketmaster do not sell out.
“In most instances where prices do change – because they will over the life cycle of an event – they actually tend to go downwards rather than up, as whichever event it may be needs to ensure that the event is selling through at the rate that they would need,” he told MPs.
There have also been claims that dynamic pricing can combat touts by better reflecting the market value of tickets, which reduces the vast margins available to re-sellers who use secondary platforms.
In a statement about the Oasis US tour, Ignition Management said last year: “It is widely accepted that dynamic pricing remains a useful tool to combat ticket touting and keep prices for a significant proportion of fans lower than the market rate and thus more affordable. But, when unprecedented ticket demand (where the entire tour could be sold many times over at the moment tickets go on sale) is combined with technology that cannot cope with that demand, it becomes less effective and can lead to an unacceptable experience for fans."
The CMA this week came out in support of a price cap for secondary market tickets.
PHOTO: Simon Emmett
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