I agreed wholeheartedly with his analysis and found myself nodding to his refusal to participate in a corrupt system.  I’m a concert goer — I’m a ticket purchaser –  I have an expectation that the process be “fair” because of a personal desire to a) sit hella close and b) not pay very much for the tickets.  Why do I have this expectation?  Michael Arrington does a brilliant job explaining the and disspelling this myth that ticketing should be “fair.”

Ticket brokers are really just market makers. They risk capital, hold inventory, and place bets that they’ll be able to make a living on the spread.

Pricing tickets is very, very hard. Demand for an event peaks just before it occurs, then falls to zero as it begins, like food that has gone bad. Changes in the economy have a dramatic impact on ticket prices, too. A good ticket broker is thinking about the quality of the event, the date of the event, the venue, the seat locations and the state of the local economy when pricing tickets. And if they do it wrong, they eat their inventory and take a loss.

Most ticket brokers don’t make much money, particularly when you factor in that they’re putting their own capital at risk. A few, those that have good instincts and the right connections, do very well.

But it’s important to know that everyone is in on the game. Players and coaches who go to the Super Bowl sell their tickets to brokers. Venues sell some of (or all of) their best seats to popular events to brokers. The artists do the same. Everyone along the supply chain gets their cut. Usually in cash, which isn’t claimed as income.

The only people taking any risk are the brokers, who put their money on the line. And when an event turns sour, they take the hit.

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