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  Industry Profile

Industry Profile: Gary Adler

— By Larry LeBlanc (CelebrityAccess MediaWire)

This week In the Hot Seat with Larry LeBlanc: Gary Adler, general counsel, National Association of Ticket Brokers.

ďPssst, you want some good tickets? I got floor tickets right here, pal.Ē

Decades ago, scalpers or resellers were illegal in many states in America.

The growth of online ticket sales, and the rise of consumer trading sites like eBay and Craigslist by the early 2000s, were factors that led to changes in state scalping laws--largely limited to street sales--across the country.

The market then developed at a rapid pace as consumers began looking on secondary ticket sites more and more after being locked out from buying good seats at primary sites, or finding exorbitant prices there, and sought other sources for tickets.

In 2007, eBay significantly raised the stakes in the secondary ticketing business by acquiring the sectorís giant StubHub for $310 million. A year later, Ticketmaster bought TicketsNow for about $265 million in cash.

Today, the U.S. secondary ticket market is a volatile $4 billion-per-year marketplace with continued attempts by the major players in the primary ticket market to quash or cash in on the secondary ticket market themselves.

The National Association of Ticket Brokers was formed in 1994 by a group of leading ticket brokers, involved in the sale of sports, concerts and theater tickets that recognized the need for a united voice for this evolving industry.

The NATB-- ticket brokers, and ticket wholesalers--created an industry standard of conduct, and created ethical rules and procedures to educate the public concerning the importance of scrupulous ticket-brokering services.

The NATB believes that free market pricing of tickets--buying and selling of tickets at their actual market value (not at the face value printed on the ticket)--is the way its members may offer highly sought-after tickets to fans in a transparent manner.

For two decades, Gary Adler has served as general counsel to the NATB, overseeing all aspects of the associationís operations. In addition, Adler is the partner In charge of the Washington, D.C. office of Roetzel & Andress, as well as general counsel of the Boxing Promoters Association, and the Alexandria Aces baseball team. He also represents football and hockey players as well as boxers.

How many NATB members are there?

We have roughly 205 members right now.

The NATB operates only in North America?

Only in North America. Interestingly, we have opened up international membership for the first time because at our annual trade show (The World Ticket Conference), we are getting lot of international brokers who want to access our association, including our education and member benefits. So we have opened it to international brokers. Itís a little bit different level of membership. NATB started in the United States, and then expanded to Canada awhile back.

What international interest is there?

We have a lot of interest from the UK, from the European Union, from the Netherlands, and from Spain. Mostly Europe I would say. We have also had interest from Asia. But most of the ones now submitting applications are from Europe.

[Meanwhile, Robert Sillerman's SFX Entertainment has taken a majority stake in the European ticketing services firm Paylogic in a deal estimated to be worth $16.5 million. Established 5 years ago, Paylogic has offices in Amsterdam, Groningen, Berlin, and Antwerp, offering white label ticketing services to more than 2,000 clients. The company also operates in the U.S., providing ticketing services for such SFX-owned festival brands as Sensation, Mysteryland, Q-dance, Tomorrowland Sensation, Mysteryland, Q-dance, and Tomorrowland.]

Thereís a long time history of re-selling tickets in both entertainment and sports.

You should read articles by (Arizona State University economist) Dr. Stephen Happel (professor emeritus of economics at the Arizona State University, and Marianne Jennings, another professor from Arizona State, who have been advocating free markets in the secondary (ticket) market since 1988. They have done all this analysis. They have found records of people scalping tickets to Shakespeareís shows. They give you a great history of the industry.

Venues and sellers often claim that a ticket is not the property of the buyer, and that they can attach whatever conditions they choose as terms because the ticket remains their property. Most ticket holders feel that they own the ticket and have the right to sell it at whatever price.

Everybody, but the people who have interests on the other side, believe that.

When we started out, there were probably 20 states in the United States that had restrictions that you couldnít charge more (for a ticket than face value). There are about four left. Every state legislator who has looked at it has said, ďThereís a right to buy and sell tickets.Ē We have not seen a law passed in the United States in 20 years (restricting ticket resales). To go the other way would be a very very unusual thing to happen now. The markets have opened up. There have also been studies. New York did a great study about it. When they opened up the market, the consumer agency for the (state) government said, ďThis is the way to go.Ē

Why the change in attitude toward secondary ticketing sellers? I remember StubHub being derisively derided as a scalper when it launched in 2000.

NATB has a code of ethics and a consumer complaint process that has worked very well. I have been handling that since 1994. Whatís happened is that it used to be, ďHow can you people do what you do? Shame on you.Ē to ďHow do I get the best experience, and avoid fraud?Ē

[Launched in 2000, StubHub is the undisputed leader in the secondary ticketing market. The company's online marketplace enables fans to buy and sell tickets to concert, sports, theatrical and other live entertainment events.]

In 2008, StubHub, along with Viagogo in Europe, were designated by Live Nation, as official resellers for Madonnaís tour dates. That was one of the first blurring of lines between primary and secondary ticket sellers.

There are all sorts of things happening that have blurred the distinction between the primary and secondary market. I was invited to speak in 1995 or í96 before the box office managers. The guy (moderator) was a good friend until the microphone came on. Then it was, ďSo Mr. Adler, you represent the National Association of Prostitutes?Ē It was a vicious attack on how could we do what we do. That has really changed a lot. It is fascinating to see what a feeding frenzy there is in trying to capture this market. Itís great for consumers.

Understandably, the role of players in the secondary market has evolved but now so many sectors of the business are trying to find ways to collect money from fans willing to buy a ticket for more than face value.

The role has evolved. The fascinating thing is that it was my members who fueled that beast that now almost controls the market that they are now in. If it wasnít for the inventory that my members have, none of those people would have succeeded. Brokers take the risks. Brokers are the holders in. Sellers have no inventory, okay? None of these marketplaces hold inventory or take that risk.

NATB members are middlemen?

They are the middlemen. The risk takers. The people who are willing to study, and take risks of investing. A great example is Broadway. Brokers will sometimes invest in Broadway so they can have access to tickets, but if that show bombs they are out a lot of money. Thatís true in a lot of instances. They buy tickets to sports teams, and itís a risk.

Why a need for an association for American ticket brokers in 1994? Why such a need today?

The catalyst for the founding of NATB was that in the early Ď90s there was a fiasco where people paid a lot of money to go to the Rose Bowl (in Pasadena, California), and ended up watching it at the Holiday Inn lounge because people promised tickets, and they didnít deliver.

It was foresight (by the founding brokers) to recognize that they needed to regulate themselves, and clean up their side of the street. (Brokers are) easy targets. People used the word scalpers. Itís a passionate industry. So they had the foresight to create this code of ethics and rules, and this 200% guarantee, and all of these things. Obviously, thereís been the advent of the internet as well as companies like StubHub which has been the major player in legitimizing the secondary ticket industry and resale market. But I do believe that people were doing the right thing, and were cleaning up the business by having these processes and recognizing that if you donít provide a great customer experience then not only will your business suffer but the industry will suffer.

Now today, thereís nobody really looking out for the ticket brokers except our association. Thereís a hundred different mousetraps out there. Everybody is trying to capture this billion dollar industry, and the risk-taker brokersóour membersóneed representation because thereís fights going on between the big 800 pound gorillas on each side that donít necessarily look out for what we believe the consumersí interest and ticket brokersí interest are. So thereís many facets for what we look at for the broker community, and legislation.

People have always given away or resold tickets that they didnít want or couldnít use, but the Internet has revolutionized the practice in the marketplace. It cut out the middlemen and the gatekeepers. If someone canít use tickets theyíve purchased, they can list them on an online exchange.

Yeah which is kind of one of the most impressive things that the founders of this association did (evolving the secondary business) because back when it started, it was very provincial, and very much driven by the location. It was little groups. Every city had its big broker, and there was almost a disincentive from a business standpoint to band together, and to create this mechanism where other people could access information. But the brokers had the foresight to see the importance of creating a uniform voice and to clean up the industry. I give them a lot of credit for being way ahead of that curve. They had the vision to put the bigger picture in sight when it wasnít an easy thing to do.

For decades buying tickets was either a box office or telephone transaction.

Yeah, I remember waiting on lines myself when I was younger. Some of my fondest memories are trying to get that first row seat or whatever. Tickets are really a fascinating thing. I have been doing this for 20 years, and I still donít have a great handle on why it (buying tickets) generates such crazy passion.

Before the internet, all ticketing was fundamentally regional.

Yeah, the internet has been great for the industry in legitimizing it. Itís great for consumers because thereís so much information available. I analogize it to when I was young, and I was a sports agent. To be a sport agent back then, you had to be a sports agent who had a lot of experience because you had to have the knowledge. Then they started sharing all of the contract information due to the playersí associations. It became much more open because you had that wealth of knowledge at hand. I think thatís the way it is for consumers today. It used to be that consumers were at a disadvantage because there was not open and free markets and competition, and there wasnít as much knowledge available. So itís (the internet) been great for the consumer.

People still say, ďIíd like to see the show but I canít get within the first 20, 30, or 40 rows. Why go to the show?Ē Thatís the perception.

Thatís very true for a lot of people. To me, itís the reverse (perception) to be honest with you. Now you can get tickets in the first 30 rows. In a free market at market prices. Thatís the beauty of it (the secondary market).Itís open to everybody. If you want to pay very little, you have to suffer as far as quality, but thatís your choice. If you do really want great seats, and you have zero chance of getting them because of the hold backs, you now have the opportunity to do that if you are willing to do soÖ

At what brokers argue is the market price.

At the market price. The great thing about the secondary market is that itís a ticket. With this free and open market, and with all of this competition, and people doing the right thing, you are getting to buy in a marketplace where buyers and sellers meet at a market value for that ticket. Thereís so much information out there that if you buy a ticket that you can (later) find cheaper somewhere else, shame on you. You havenít done your homework. Thereís just so much information out there, and thereís so much access (via the internet) that itís really fantastic. You can purchase a ticket at whatever that market price is. Now people may not like what that price is, but we canít do anything about that. But I would say that there is now a fantastic mechanism to have a free and open market for tickets.

Following eBayís purchase StubHub and Ticketmaster buying TicketsNow, it seemed like all venues, teams, sellers, brokers and even artists began asking themselves, ďHow do we capture that secondary market ourselves?Ē

The margin for ticket brokers has been drastically restricted because of the competition in this market. Thatís not good for consumers. You canít dabble in this industry. It is very, very risky, and difficult. Itís a ďyou have to have nerves of steelĒ kind of business. Of course, everybody is trying to capture this billion dollar business. You hear that Ticketmaster or Live Nationís people are always talking about is ďWeíre going to capture this market.Ē But what people are finding though isóand I will use a term that I used in sports--is that you jump over a dollar to chase a dime.

Often times, when teams, promoters, Ticketmaster or whoever, try to capture what they are losing on the primary market, they hurt their primary business because they are not selling their tickets.

A good example is that I remember that the Minnesota Twins built this new stadium (Target Field in Minneapolis, Minnesota which opened in 2010), and had a good year. They were welcoming brokers before that. ďBuy season tickets. Buy season tickets.Ē They saw that there was a good ticket market, and they stopped selling to brokers. And they came begging back about a year later because they couldnít sell any tickets.

We see that time and time again. That there are these people trying to capture what they are losing on the secondary market and they end up hurting the golden goose---their primary business. Thatís a lesson being learned the hard way by a lot of issuers of tickets.

Ticketmasterís purchase of TicketsNow in 2008 has long been cited as a potential conflict of interest of a company operating in both primary and secondary sales markets.

Ticketmaster has an interesting history with brokers. When Sean Moriority became president, and they purchased TicketsNow (for $265 million) I hosted a fireside chat with him (in 2008) because they were embracing the secondary market. Thatís changed over the years and, maybe, changing back to some of the things we have seen with the Ticketmaster resale. The juryís out on that.

But yeah, itís been fascinating to watch everybody trying to figure out the best mousetrap to work the second marketplace itís really a fascinating thing.

We had a meeting recently with some peopleóand I donít want to mention names-- but we were going around the room with my people. ďHow many years have you been in business?Ē The answers were ď35 years,Ē and ď30 years.Ē These members of my association have been doing this for a long time, and they have survived a lot of different issues. This is an interesting time because of the competition in the secondary market, and people trying to capture it. Now you have artists trying to capture it. But the interesting thing is that in the last surveys that weíve seen 40% of tickets in the secondary market sell below face value.

Oh, come on. You are referring to a Forrester Research report from 2008. I donít know if that would be true today.

Oh, I think that itís true today. If anything, I think that itís gotten more so because the face values have gone up so high and competition for entertainment dollars has gone. And there are so many people touring now. I donít have the empirical data to give you (to back up the 40% claim) but thereís tons of examples of tickets to great shows selling for below face value for sure.

The NATB lobbied against the 2010 merger of Live Nation Inc. and Ticketmaster Entertainment. Live Nation and Ticketmaster argued at the time that the merger was necessary to help "strengthen a flagging music industry." Were your fears merited?

I think that they were merited. I think that it has been more difficult for them to accomplish what they would like to accomplish. I do believe that if there ever was a vertical monopoly that was it. When you have the artists, when you have every tier being able to control, and restrict the market for their tickets, yes itís a big fear (of being a monopoly). It has not been as successful as I think they would have liked it to be, but itís still a big fear for us.

Regulators in the U.K. and U.S. imposed conditions on the merger.

They were all little minor things. Vertical monopolies in the United States are very rarely restricted by the government. Vertical meaning that they are not direct competitors on the same level. We are seeing them trying to control the fees charged for a ticket in the secondary market like they did in the primary market. That was the Ticketmaster/Pearl Jam thing (in the mid-Ď90s). Now with Ticketmaster, we are seeing them trying to assert that monopolistic power in the secondary (market), and itís very, very scary, and very unproductive for consumers.

Itís just not good.

So we are still fighting that fight. Trying to make sure that the free markets are protected, and (fighting against) these mechanisms by which they are forcing consumers to only one place to re-buy and sell tickets, and being able to charge fees and being able to put floors on how much you can sell them for arenít successful. And we will keep fighting.

Its critics argue that Ticketmaster is now in a position to control both the primary and secondary levels of the market.

Yeah, itís been an interesting thing to watch. Right now, you have two of the biggest companies in the world fighting each other over the secondary marketplace. One of the things that we do is monitor legislation, and you are seeing these battles waged between StubHub on one hand and the artist and Ticketmaster on the other side and nothing ever constructive really gets accomplished. So we have advocated or presented kind of uniform codes that we are promoting that seem to cover the legitimate interests of every player in the industry.

Give me some examples.

A free market. You canít punish a season ticket holder for reselling tickets You canít force somebody to resell a ticket only through your Ticketmaster or team site. Itís bad for consumers because they (one or the other) will put price floors on the tickets. Those tickets that sell below the box office amount. They will add fees on. Thereís no competition.

Thatís one.

Automated devices (automated "bots"), outlaw them.

Thatís two.

Three, consumer protections. Have uniform consumer protection measures so that we are insuring that the resale of tickets is done by legitimate businesses in the light of day as opposed to back alley or out of the trunk of a car transaction.

In order for people to know what they are buying.

So people know what they are getting when they buy a ticket. If you try to outlaw the resale of tickets, which has been going on since Shakespeareís days, you are never going to accomplish that. What you are going to do is drive it into the back alleys again which is where it used to be, which is the worst possible thing we could have. We want transparency in the distribution of tickets. To have some disclosure about how many tickets are available to the public.

Scalping has traditionally been defined as someone selling a ticket at a sizable markup.

People use the word scalper as a derogatory term. I guess the distinction that I make is that there is a difference between the people who are outside the venue on the night of an event (selling tickets), and the people that we represent.

Events like the Bruce Springsteen ticket fiasco in New Jersey in 2009, where fans were directed to TicketsNow while face-value tickets were still available, brought the hidden business of secondary out in the open with the public.

Yeah. The lack of understanding about the secondary market is phenomenal. From a lot of legislators to enforcement people to the public. People donít quite understand it. Itís very interesting that thereís that lack of knowledge. Weíve always advocated for transparency. One of our core principals is a free market but we know that to have a free market we canít have fraud, deceit, or that kind of conduct.

One of the interesting things about the New Jersey situation that it shed light on all of this (ticketing) because in New Jersey their big arena is a public arena, and they got access under Freedom of Information Act to look at the distribution of tickets which is most hidden secretive process in the whole world.

How many tickets actually get put out to the public? That was important I think because it showed that the reason people arenít getting tickets or donít have a really great chance of getting tickets wasnít because brokers are scooping them all up because so few tickets actually get made available to the public.

Just how many tickets are held back by the venues, promoters, artists or fan clubs and never made available to consumers is closely guarded. One concert breakdown I read about had about 2,000 tickets going to the fan club, 2,000 to radio, and 5,000 to American Express and other sponsors. I donít think that is that rare.

I donít either.

Do many of those tickets end up in the secondary market?

Well, yeah. People always ask how brokers get tickets. The perception is that there is this computer system scoop up of tickets. We have always advocated against that because itís contrary to a free and open market. We work with law enforcement to fight that. Itís a disadvantage to the good, legitimate brokers because they donít have access. But itís not really the reason why people canít get tickets in my view. The reason that people canít get tickets is because they end up in the hands of these people who are interested in re-selling those tickets.

The concept that a broker makes the difference between a face value of a ticket and the price that they sell it for is really not the usual case. There is this whole middle market of people who are buying and selling tickets. There are also all sorts of investments that you have to make to get those tickets. For example, you buy tickets to a lousy sports team so you have access to some other tickets at that venue. So yeah, thatís how a lot of tickets get on the secondary market.

While promoters, sellers and brokers are always criticized over ticketing, but one of those at the table passing themselves off as pure as white-driven snow are the artists while many of them are trying to grab that secondary revenue for themselves.

Probably my biggest pet peeve. It is easy to attack the brokers when we are doing it in the light of day. It has got to have transparency and when people donít thatís where issues arises. And thatís what artists have been doing. Youíve got to respect a guy like Kid Rock who comes out and says, ďHey, I have been trying to get $20 tickets to my fans and Iím going to scalp my own tickets to be able to do that.Ē At least, thatís being upfront and honest. There are all sorts of things that we see from artists who, I guess, donít want to take the flack of trying to capture the market value of their tickets.

Have sellers been successful in closing down automated "bots" that grab tickets?

Yeah I think so. I may not be the person best suited to give you that analysis.

But itís not as widespread as it once was?

From my perspective, thatís accurate. I know that they have gone after some people and they--Ticketmaster and the other ticket companies---talk about stopping this. They have all of the information to do that, and we know that they have brought some actions against people, and we have supported that. I think the perception among my members is that there are probably still some people out there doing it. We want to stop it completely.

But it is certainly not the reason why tickets arenít being available to public or an event sells out in a second. Thereís a lot of shows that happen where we know that brokers donít have a lot of tickets. There are all of these portals now, these marketplaces, and a brokeróa member of my association--will list these tickets on all of these different sites. So when you go to all of these different sites, you see some of the same tickets. So when people say that there are thousands of tickets on the market, often times itís the same ticket just being shown on different marketing avenues.

Paperless ticketing remains controversial.

Paperless ticketing is a tool that doesnít make sense. The problem with paperless ticketing is when it is used to restrict the resale of those tickets. It is not paperless ticketing that is the evil. The evil is when it is used in a restrictive manner so as to force people that, if they want to transfer or resell those tickets, they can only do it through one mechanism; whether or not itís Ticketmaster which is the usual case--with those fees, and without a free market where buyers and sellers deal at market value.

[Ticketmaster has argued that paperless ticketing is an effective method to limit ticket resale and better provides fans with access to tickets at the original face price set by the artist, team and/or promoter.

With paperless ticketing, fans do not receive a physical concert ticket for their entry into the event. On the day of the event, they are required to bring the credit card they used for the ticket purchase and their photo ID to the concert. All members of the ticket purchaser's party must be present at the same time to enter the venue. The venue's ticket usher then swipes their credit card upon entry, and presents each person in the party with seat locator slips for access into the show.]

Critics of paperless ticketing argue that the practice just doesnít work. It only stops the casual reseller who flips tickets on StubHub, Craigslist or eBay from scalping tickets.

It doesnít seem to work. Even when their (an artistís) intentions are good, which is very rare in my personal view. We see behind the curtain. We see these artists who are using these tools to get the tickets in the hands of the fan, and what they are really doing is trying to capture the (secondary) revenue because they only want it sold only through the place that they can charge fees. But every once in awhile you do get an artist that is genuinely trying to keep their tickets at $25, and in the hands of whoever they believe the real fan is. But that is rare.

There are artists with good intentions that seek to keep ticket prices low.

But (their actions) can really misfire. As long as thereís a ticket, thereís going to be somebody wanting to buy, and sell those tickets. If you limit the supply by creating these kinds of things, what you really are doing is just driving the price up, and making people want to sell their tickets more. For most people, thereís a price that they are willing to give up that experience for that price. In my view, 99% of the time, these restrictions are based on revenue generating interests, and the rare, rare instance that itís notóand there are good intentions--they are really doing a disservice to what their intent is. They are just creating a scarcity, and high prices. Itís just counterproductive to what the artist wants to accomplish.

Conversely there are artists seeking to build revenue streams by fan club activities at live events including exclusive meet and greets, and even charging for access to sound checks.

That is whatís great in a way for consumers, but makes it very difficult for my members to succeed. But we canít advocate for a free market, and then blame artists for legitimately trying to figure out ways to create revenue. If they want to compete in this secondary market in a transparent way, free of deceit, then they are welcome to join us in this open and competitive market.

Do individual states have different laws about scalping of tickets?

Yes, itís all driven by state laws. As I said earlier, when we started in 1994, there were probably 20 states that had really serious restrictions on the resale of tickets. I do have to make a distinction between scalping and brokering because we never advocate against laws right around the venue. Thatís not our fight or battle. Thatís what we consider scalping.

Legitimate businesses that resell tickets principal businesses thatís what we protect. Each state has its own laws as does each (Canadian) province. We have a broad membership in Canada so I am pretty familiar with the Canadian laws. I know about Quebec which passed this law that makes it illegal to re-sell tickets, and itís been a disaster.

[Amendments to Quebecís consumer-protection legislation came into force in 2012 making it harder for ticket brokers to resell tickets above face value. Bill 25 requires any business seeking to resell event tickets above face value to: Get permission from the original vendor; make it clear to potential buyers that the tickets are being resold; tell buyers the name of the original vendor; and inform buyers of the tickets' face value.

Fines range from $2,000 to $100,000 (Canadian) for a first offence and to a maximum of $200,000 if a violator breaks the law again.]

You work in both sports and live concert sectors. Are there lessons found on the sports side that might be avoided by the live concert side?

I remember that we had the president of the Washington Nationals, Stan Kasten speak at our trade show in 2007. He said, ďPeople think that I hate brokers. I love you. Hereís my card. Call me personally. I will sell you tickets. We are going to try and beat you at your own game at some point.Ē

Teams, based on a necessity because of the cost of a seasonís ticket, have been very broker friendly in the past. They have recognized the need for people to take risks in purchasing season tickets, and be able to freely resell those tickets. They have encouraged and welcomed us. In the concert business, that has never been the case.

Any relationship is viewed in adversarial terms.

Right. I think that the lesson to be learned is that you set your price; do the best you can in setting that price whether itís with the new tools that you have or whatever it is; and then let the market control what happens afterwards. If you try to restrict that (secondary) market, you are going to end up hurting yourself by not being able to sell as many (primary) tickets as you should be able to sell.

Some teams have come to recognize the value of partnering in the secondary marketplace.

Thatís the lesson that I think that teams have learned. There are still some teamsówhere there are some stuff going onóbut, in a general sense in the sports environment, brokers are welcome customers of sports teams. In the concert industry, they are not. The sports teams are ahead of the curve because they recognize the value of someone else taking the risk in the resale market.

Sports teams also know that they are an established franchise in a market, whereas artists arenít. A poor-selling concert is no match to having a handful of games half full.

Thatís a great example. When you have the Toronto Blue Jays playing the Yankees, thatís one game that someone might make money on a ticket whereas they are not making money on many of the other games. The concert industry is pretty similar to that. There are not that many tours that are really cream of the crop makers for the resale of their tickets, especially when they are charging so much on the front end.

Itís a real science what my members do. Itís not that they are going to get the best ticket and see what happens. Sometimes itís knowing a venue or knowing what sells better than other tickets. Maybe, itís the cheapest seat that they can make money on when they canít on other tickets. Thereís a real skill to all of this.

Brokers donít have control over the ticket pricing, really. The base ticket price is set by the promoter or the act.

Exactly. Thatís why itís such a tough business. Letís face it; they (sports teams) were slow to the dance in a lot of ways. Like to charge the same amount for the 30th row that they charge for the 10th row. (Some sellers) charge the same amount for a Tuesday night game as opposed to a Saturday night game. They are learning though and they are getting smarter and they are pricing the tickets which means there are less margins on the secondary market. But again we also think that itís such a wonderful experience with my members and a lot of the mechanisms in the second market. You go to Ticketmaster and try and get a customer service rep. You go to my people, and you get the white glove treatment. You are going to get what you were promised. Itís stress free. Itís a great experience. Thatís what StubHub has done really well.

The NATB maintains that ticket consumers should deal with legitimate tickets brokers but people often donít look before they leap in buying tickets from unreliable sources.

We get calls daily from consumers asking if someone is a member of the NATB. One of our responsibilities is to get that word out more. Itís not easy to do but I do think with the Better Business Bureaus now recommending that people check if a broker is a member of the NATB helps. We have (state) attorney generals (overseeing ticketing practices) recommending consumers make sure a broker belongs to NATB. We have done a good job of creating the Good Housekeeping seal that has become valuable, but we certainly are not there yet. I think that you are right. If you want to take the risk and buy a ticket on Craigís List, go for it but you are taking a risk.

The same thing with eBay?

The same thing with eBay, probably. To me, thereís a sliding scale of risk, but we (NATB members) have a 200% guarantee. I get complaints from people who deal with people arenít members, and I have to tell them we canít do anything about that, and next time do it through a NATB member.

I do get complaints against NATB members, and I will tell you that there has only been one time in the past five years that a consumer came out and felt like this wasnít resolved. Often times, the broker is in the right but, just to recognize that we are building this trust on doing the right thing and that this is baloney, they will try to make the customer feel good.

So yes, I will agree with you that not everybody is doing their homework, but the other thing is if you buy directly from a broker, from a NATB member, you are going to get a better price often because you are not generally paying the fees. Brokers have to pay fees in some of these marketplaces, so sometimes the prices are higher than they are direct from the seller. But if you arenít going to do your homework, shame on you. The same ticket will be at different prices on different places. So itís worth taking the time to check.

How did you get from George Washington University into this side of the business?

I worked for the Washington Capitals while I was in college. I knew that I wanted to get into sports management at a young age, and there was a fantastic guy Max McNab who won the Stanley Cup with the Red Wings in 1950. He was the general manager of the Caps. Every Saturday I would callóI knew that if I called during the week I would never get through to anybodyóand one Saturday he picked up the phone. He is my hero. A wonderful man. He appreciated my initiative and he got me a job with the Caps.

You were still at George Washington University?

I was still an undergraduate. I was, maybe, 19. He was the one who said, ďYou can stay here working marketing but I think that you should become a sports agent. I will write you letters of recommendation, and help you.Ē So I decided to go to law school, and become a sports agent. I worked for the football players union. I was a sports agent pretty exclusively when I first started out. I ended up not really enjoying it very much because athletes are spoilt, and it was very corrupt. You had to pay people when they were amateurs and I wouldnít do that.

How did you come to be involved with the NATB?

I got to know some sports people and a couple were in the brokerage business. They came to me with this idea of doing this. So I helped them create this association, and I have been there since. My members are the best people that I have ever met. They do the right thing time and time again. They see the bigger vision and there are selfless in their devotion. There are a lot of people who have studied this industry who give us some credit for the vibrant secondary market. Maybe, a little less (credit) than the internet (laughing).

Larry LeBlanc is widely recognized as one of the leading music industry journalists in the world. Before joining CelebrityAccess in 2008 as senior editor, he was the Canadian bureau chief of Billboard from 1991-2007 and Canadian editor of Record World from 1970-89. He was also a co-founder of the late Canadian music trade, The Record.

He has been quoted on music industry issues in hundreds of publications including Time, Forbes, and the London Times. He is co-author of the book ďMusic From Far And Wide.Ē

Larry is the recipient of the 2013 Walt Grealis Special Achievement Award, recognizing individuals who have made an impact on the Canadian music industry. He is a board member of the Mariposa Folk Festival in Orillia, Ontario.

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