Fair Ticketing Alliance's Scot Tobias Defends Ticket Resellers: 'The Bottom Line Is the Public Loves the Secondary Market'
As founder and president of Worldwide Tickets, Scot Tobias has spent nearly 30 years in the ticketing industry, growing his New Jersey-based business from a small resale start-up to a global enterprise that operates throughout the United States, United Kingdom, Australia and South America. In 2017, Worldwide Tickets generated global sales of over $35 million, including close to $4 million in the U.K. alone, with a staff of 30 in the U.S. and six in England.
Tobias is also one of the key figures behind the Fair Ticketing Alliance, a coalition of “responsible” U.K. ticket brokers set up earlier this year to advocate and campaign on behalf of the secondary ticketing industry. Speaking exclusively to Billboard, Tobias -- a licensed and bonded broker in the states of New Jersey and New York -- talks about the alliance’s goals and why believes the under-fire secondary-ticketing industry is integral to a thriving live music business.
Billboard: What was the genesis of the Fair Ticketing Alliance?
Scot Tobias: I was introduced to the U.K. market three or four years ago. Ticketmaster and StubHub asked if I wanted to get involved and help them grow the business. After about 18 months we were having tremendous success. Then these raids took place where four parties had their assets seized, tickets taken and put out of business. So I hired a legal firm to look into exactly what the laws were -- what was allowed, what wasn’t -- and this firm couldn’t tell me what the real laws were. There’s a lot of uncertainty. It reminds me of the ticket business in the U.S. 25 years ago. [Back then] we had to get organized and get a voice for ourselves as resellers to carve out our place in the ticketing ecosystem. So we spoke with ASTA [Association of Secondary Ticket Agents], got some brokers together and formed the Fair Ticketing Alliance to try and establish fair practice and clarify what the laws really are.
What are the group’s aims and goals?
To make it a fair playing ground for people that want to participate professionally in ticketing. There’s a lot of speculation as to what is legal and what isn’t legal. We’ve made a submission to the Digital, Culture, Media and Sport Committee inquiry into live music and we have got positive feedback from a lot of people. I went through this same process in the U.S. and once people heard both sides of the story we were able to establish a level playing field. The explosion of the secondary market in the last two years has caused a lot of this backlash and kneejerk reaction [in Europe]. But the bottom line is that the public enjoys and loves the secondary market. They love the convenience. They love the availability. They love the true valuation of the tickets. And as brokers, we want to participate in the markets fairly.
There’s been a great deal of opposition to the secondary market in the U.K., with numerous government and regulatory investigations. What’s your response to critics of secondary vendors, like yourselves, who charge that you’re killing the live industry?
The live industry in the U.S. is more vibrant than ever and they have allowed the secondary market to participate. An open market is a healthy market, just like the stock market. These [secondary] market places can offer up a lot of tickets. They can market them to the public better and there are a lot of responsible resellers who get product and present it on these market places and the public likes it. I think we should all be celebrating the success of all this, but in the U.K. they're looking at this as a catastrophe.
Critics say you’re ripping off fans by charging grossly-inflated prices for tickets.
There is a sector of [fans in] the market that don't get the opportunity to buy the tickets right away, but do like the luxury of being able to buy them later at a premium, or else they wouldn’t do it. People wouldn't buy these tickets at a premium unless they wanted to. We have had problems in the U.S. with deceptive websites and deceptive marketing practices, which I’m very much against. That needs to be addressed, but you still have to allow people to be able to buy and sell tickets as long as they are doing it fairly.
How do you see the secondary ticketing market evolving?
It took a long time [in the U.S.] to really get it to a point where the primary and the secondary markets could co-exist. Eventually those lines will blur [elsewhere]. We’re seeing that now in the U.S. with some of the official partners like StubHub and Ticketmaster Resale where they are allowed to put a new price on a ticket. I’m all for transparency and I’m all for a level playing field, but I’m also for an open and free market where more players are allowed to participate in ticketing. The public has always wanted the service of ticket resellers. It goes back to the Middle Ages. And we have a legitimate place in the market.
Where does your company, Worldwide Tickets, get its ticketing inventory from?
There’s what’s called secondary platform traders which buy online where you can do it fairly and legally with legitimate accounts and legitimate agents. We also build relationships with venues, performers and teams and help them with their ticket distribution. It’s very similar to the convenience store business, which provides products like water and bread at a higher price for people who don't want to travel far. Tickets have always been singled out unfairly as an item that needs so much regulation. You can go on a highway and buy a bottle of water for $5 that costs you $2 in a store. But if you buy a ticket for $140 that may have had an original cost of $100, everybody freaks out.
What do you feel are the dirty aspects of the secondary market that need to be cleaned up?
Obviously, bots are an issue. There have also been cases of people not delivering [tickets], but I really don’t see a lot of negative aspects because you’re dealing with public companies like StubHub and Ticketmaster. They have done a fabulous job of creating a fair and safe place to buy and sell tickets. The more that these companies grow, the less infractions of what you would call "deviant behavior" you will have.
One area that has drawn a lot of criticism in Europe is the close relationship between promoters and secondary ticketing sellers that effectively sees a proportion of tickets delivered straight to resale platforms. Do you think that’s an acceptable practice?
I think performers, [artists'] teams and the venues have the right to sell their tickets wherever they want. I understand why they are using the secondary market because it’s a great channel for them. They’re the ones taking the risk putting on the events and investing the money. [As ticket brokers] we’re speculators just like investors in other industries, like real estate or the stock market. We’re very against the bots that are buying tickets unfairly. We are against corruption in the ticketing business and payoffs where tickets are acquired illegally. But by thwarting the resale market you’re only going to make all those [illegal] avenues of acquiring tickets flourish.
Viagogo’s business practices and its repeated flouting of British consumer laws have drawn a lot of criticism and government scrutiny in the U.K. Does your company work with Viagogo?
I don’t currently, because I am afraid that I may not be complying with U.K. law. Right now, I have basically closed my operation in the U.K. due to the uncertainly of these open cases and the fact that Viagogo is not agreeing to some of the [British consumer law] terms. I have done business in the past with Viagogo and I would love to do business with them again in the future, as would a lot of sellers in our alliance, because they move a lot of tickets. We just want to figure out how we can do it safely and without being in violation of U.K. law.
What next for the Fair Ticketing Alliance?
We want to open the communication lines with the government, lobby for our rights and figure out how we can participate fairly and legally in the market. Right now, we’re a U.K.-focused alliance. But the same challenges that we are finding in the U.K. are in South America, Australia, all over the world. There’s a lot of resistance to a free and open market outside of the U.S. right now and the secondary market hasn’t had a chance to explain its importance. It’s not easy when your business is shut down out of fear and uncertainty. We had an office in the U.K., had six employees and we were paying taxes, yet we have fewer rights than a consumer who can buy and sell tickets freely and doesn’t pay taxes. But we hope that we’ll be able to work with the [British] government, get some clarity and we can all flourish and have a place in the ticketing industry.