For the international contemporary live music industry

Anti-tout campaigners slam Viagogo’s $4.05 billion purchase of StubHub

WORLD                -
World News
December 16, 2019

CONTROVERSIAL RESALE site Viagogo is buying eBay-owned StubHub for $4.05 billion.

It brings Viagogo founder and CEO Eric Baker back to where he started in the sector, as he co-founded StubHub with Jeff Fluhr when they were still at business school.

Baker left StubHub and moved to the UK to launch Viagogo, after which Fluhr sold the company to eBay for $310 million in 2007.

“It has long been my wish to unite the two companies,” says Baker. “I am so proud of how StubHub has grown over the years and excited about the possibilities for our shared future.

“Buyers will have a wider choice of tickets, and sellers will have a wider network of buyers.”

StubHub president Sukhinder Singh Cassidy says, “Bringing StubHub and Viagogo together will allow us to drive further expansion and innovation, and create a more competitive offering for live event fans globally.”

The sale is expected to close by the end of March, subject to regulatory approval and customary closing conditions.

In August, the UK’s Competition & Markets Authority suspended preparations for contempt of court action against Viagogo, following its failure to comply with consumer protection laws.

However, supporters of anti-ticket touting campaign group FanFair Alliance say they are increasingly concerned at the link-up between the world’s two leading resale operations.

Folkert Koopmans, MD of Germany-based pan-Europe promoter and festival organiser FKP Scorpio believes the merger will negatively affect his business and reflect badly on the industry as a whole.

“On the one hand we will probably experience that still more revenue will be taken away from us by those platforms,” Koopmans tells Audience. “On the other hand – and that is something that really bothers me – I fear that the customers who will continuously get fooled by those companies, will lose trust in us and our business.

“Obviously we have had our share of disappointed Viagogo ticket buyers, and we are happy that we and other promoters have joined forces with FEAT [Face-value European Alliance for Ticketing] to tackle those issues together, since this affects all of us.”

UK-based FEAT director Sam Shemtob explains, “It’s likely that the acquisition will further restrict competition for tickets, making things even worse for fans, who are already priced out by touts.

“This means fans attending less shows, more empty seats at shows that would otherwise be sold-out and further erosion of consumer trust in live music.

“Our members, some of the leading music promoters across Europe, are fed-up of seeing their tickets scalped on an industrial scale and seeing their audiences ripped-off by unscrupulous touts.

“We believe that greater transparency on ticketing platforms and search engines, coupled with harmonised legislation between countries, and simpler systems for preventing breaches of national laws, will improve matters for both fans and industry.

Adam Webb, campaign manager for FanFair Alliance, which is funded byt the managers of artistes such as Arctic Monkeys, One Direction and Mumford & Sons, has written a letter to the UK’s Competition & Markets Authority urging the governmental watchdog to investigate the merger and its potential implications for consumers and the live event industry.

“A merger of the two, would potentially leave a single market-dominant platform – there would be no competition,” writes Webb in the letter.

“This would, we believe, inevitably lead to even higher fees for consumers, and an even greater dominance of search and social media advertising – increasing the risk of consumers being led needlessly towards inflated tickets in the secondary market, and away from authorised primary ticket agents.”

Looking ahead, KFP Scorpio’s Koopmans says, “It is good to see that some things are moving in the right direction, for example the EU’s first-ever ticketing legislation. At the same time, it is a step back that Viagogo is back in the top ranks on Google.

“The public needs to be made more aware of Viagogo’s and similar companies’ business models.”

As Audience went to print, the CMA says it has launched a preliminary investigation into the takeover and whether it would result in a substantial lessening of competition within any market or markets in the UK.

The watchdog has invited comments on the transaction until 10 January, but has not yet started a formal Phase 1 investigation.

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