Ticket brokers and the Super Bowl
This article caught my interest. It addresses speculation in the market for Super Bowl tickets.
In ticketing, short selling works like this: A speculator offers to sell a ticket they do not own, for a price above where he thinks the market will ultimately end up. At the time of the sale, this may seem like a good deal. Following the normal ticket market demand curve, as the event gets closer, prices drop…
…For last year’s Super Bowl in New York, the cheapest ticket on game-day was going for around $1,500. If the same pattern held this year, a spec seller who sold their ticket for $2,000 after the conference championship would pocket $500 and a 33% return for their week’s worth of work.
A 33% return is nice for one week’s worth of work, except when the market goes the other way:
With the cheapest pair to the 2015 game now going for $10,000, those same sellers are now looking at losses of up to $8,000—for each ticket.
The cheapest face value ticket for this year’s Super Bowl was $1,200, which is $8,000 less than what you can get now on the secondary market. With nothing particularly different about the match-up, the participants or the location, those kinds of numbers suggest that the market is rigged.
The alternative explanation is that ticket brokers went heavily into short positions, unexpectedly encountered unfavorable market conditions (538 has historical pricing) and consequently ran up ticket prices when trying to cover losses. Simple as that.
While those with access won financially this year, they’ve done so at the expense of the fan, their own integrity, and the consumer’s trust in the ticket market.
Please. The same can be said for last year, and we know that the winners in last year’s markets are the losers in this year’s market.