UP549 Priced Out: FIFA’s Big Ticket Gamble

The news agenda around this summer's FIFA World Cup in North America has been dominated by the price of tickets. 

Why are they so expensive? 

What's it got to do with changes made by FIFA specifically for this tournament? 
Guests:
Professor Rob Wilson, Dean of University Campus of Football Business (UCFB) and Shaun Stewart, vice president of StubHub, known as Viagogo in Europe.

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Transcript

Shaun Steward, viagogo 0:00

the World Cup could set a tone of like, this is the way the future looks for ticketing. Instead they doubled down on the exclusive control that really we've seen for decades and that we know has led the ticketing world into a bad place.

Speaker 3 0:12

Welcome to Unofficial Partner, the Sports Business Podcast. I'm Richard Gillis. It is fair to say, is it not, that nobody really likes the ticketing industry, the ticketing experience, and we feel ripped off most of the time. But the news agenda around this summer's FIFA World Cup in North America has been exceptional in terms of the way in which the price of tickets has dominated. Why are they so expensive? What's it got to do with changes made by FEFA specifically for this tournament? Strap in for a very interesting conversation With my two expert witnesses, Professor Rob Wilson, Dean of University Campus of Football Business, and Sean Stewart, who you heard just then, who's vice principal of StubHub, known as Viagogo in Europe. If you're interested in, more of this type of conversation, we've got a huge archive of podcasts with people from across the global business of sport, and you should subscribe to the Unofficial Partner Substack newsletter. Get it every Thursday. Directly to your inbox, everyone else does, that you know, so why not you?

Richard Gillis, Unofficial Partner 1:19

We're gonna start talking about the World Cup.'cause obviously you can't talk about tickets and not talk about FIFA in America 2026 if you mention the word ticket, that's where this conversation will go. I think there's other things that sort of jump off it, but we'll get to that in due course. But FIFA didn't just lock down the primary market. They built their own secondary platform, sean, is that a fair reading of what's happened, do you think?

Shaun Steward, viagogo 1:42

Yeah, I think this World Cup has kind of three or four areas that are very unique versus how previous World Cups have been executed from a ticketing distribution perspective. The first one, which has been widely covered is just the acceptance or the investment in dynamic pricing, and that's been two factors that you've seen on the primary ticketing side, which is the pricing is yielding much more than it has traditionally, and varies by game and also by booking window and a bunch of other factors that traditionally the World Cup and ticketing in general has not deployed. Um, Yield management. As a practice is far more sophisticated in other perishable product industries like airlines and hotels. For this World Cup, there was definitely more of an embrace of dynamic pricing versus fixed pricing throughout a window. The range that, that. Dynamic pricing has been instituted around is larger as well. Both in the bid it was larger. And then what's actually been executed is larger With tickets. We've seen the finals as high as$10,000 seats at that range. So you're going from like a$60 US low point to a$10,000 US high point. That's quite the range and certainly the high point is beyond what we've seen traditional or previous World Cups price that the second component you alluded to a bit, which is there's VIP and hospitality and corporate packages and suites, and like much more of an embrace. In the multi-component event experience, not just a ticket for a seat, but also potential additional hospitality elements to that. And I think you've seen this both in the UK and globally, that sports and music have been shifting this direction for a long time, since the first day you could get sushi delivered to your seat at a Mariners game in Seattle. Suddenly live events have been beyond just standing room only, or a seat at an event. It's become multi-component with, you know, a dinner before or after the game or VIP access to different amenities. And the World Cup has embraced that a great deal, which also pushes pricing up.'cause the multiple components mean it's just not a ticket you're

Richard Gillis, Unofficial Partner 3:36

Yeah.

Shaun Steward, viagogo 3:37

And then the third one you alluded to, which is just greater control over both primary and secondary. They have their own official primary side and the primary technology backend that they partnered with. They phase the access to that multiple different windows of opening and distribution of that original primary allotment. But then the most unique thing that as you look at other World Cups, but also other big kind of events like the Olympics, is that they built and are now managing and running their own secondary platform as you alluded to. So both the lift above face value and the fees generated on secondary transactions are all going back to fifa which is unique versus. Other World Cups and other events as well. so yeah, a lot. And then that's all around what you started with, which is 104 games, 48 teams, like it's a larger event than any other World Cup in history as well.

Richard Gillis, Unofficial Partner 4:26

Rob, this is the biggest revenue generating opportunity that FIFA has for a generation in the biggest, most capitalistic market in the world. It's the most valuable sports market in the world. It is in fan's job to make as much money from this World Cup as he can. And the secondary market is a leak on that. So he's looking to stem that and own the secondary marketplace. What's wrong with that you think?

Professor Rob Wilson 4:53

That's a good question. Undoubtedly. FIFA operate on this four year cycle. We've heard him talk, haven't in recent report recent interviews where he's discussed the need to generate a higher revenue for FIFA at this World Cup as he possibly can. What FIFA have really done is look to exploit every single potential avenue of. revenue generation that they could possibly get. And naturally that has then pushed them into secondary marketplace because they are selling upwards of 80% of their primary tickets to people that have already kind of locked those down. So that then creates this surge in demand. Then you're into the economics of supply and demand, and he is making infantino, fifa and making a huge amount of money. I guess. The critics will say, and I'm probably one of those, that the World Cup belongs to fans globally, and we should be talking about access rather than the fact that they're making massive margins on secondary tickets.

Richard Gillis, Unofficial Partner 5:49

Sean, there's a question here. I think about there's money and then there's reputation and FIFA's reputation. Is valuable and it's being monetized by sponsors. And you've got people at Unilever and Coca-Cola spending a great deal of money, hundreds of millions on the brand and the event and the association. What do you think about that sort of risk reward question when it comes to a major governing body looking to get into the secondary market?

Shaun Steward, viagogo 6:17

Yeah, I mean, we've existed in a monopoly structure since. 1976 in the US and a little bit after that in the uk. And now people are developing technology to be able to widely distribute tickets across more than just their primary single channel to market. Now what you find is is the most important fork in the road. Starts with their objective. of the rights holders we meet, they set a face value of tickets and they say, we want people to pay this amount for tickets and nothing more, and preferably nothing less that in a dynamic world they may have to price down in different markets to try to drive occupancy. But their goal is like, this is a fair value for the ticket. We want the majority of people to pay this, and hopefully not less, not more. Then you see other teams we meet with where their goal is to maximize ticket revenue, and they see secondary as actually, which we just mentioned, like supply and demand equilibrium. Secondary is a different and better barometer of what the market's willing to pay for a ticket to an event. And the majority of tickets on secondary aren't. Taylor Swift and Oasis and World Cup. The, you know, the average transaction's an$80 ticket, a lot of them go below face value because many events across the world have challenge finding additional demand, which is why people are moving to this wider distribution. But when you have the biggest football event. On the planet that happens every four years, and the level of demand versus supply is a hundred x what the ticket availability is. Then it comes down to is the rights holder's objective to grow average ticket price and maximize revenue, or is it to cap it at a certain price and try to make sure everybody's saying pays the same price that they think is fair and balanced? And in this case, you clearly see the latter, which is a strategy to maximize revenue and maximize ticket growth or pricing growth. And also do so through multi components and hospitality and greater experience offerings than just the ticket.

Richard Gillis, Unofficial Partner 8:05

does it matter? Is it all noise until there's an empty seat? There's a If everything sells out. If every match sells out, they sell every ticket. Will this strategy be deemed as a success or is it more nuanced than that, do you think?

Professor Rob Wilson 8:19

I am gonna jump in now. I think it kind of depends on your position as the fan. I want to gain access to the World Cup, I will look on a secondary market because I haven't been able to get a primary ticket. And I'll consider whether or not that price is something that I am willing to pay. And that's the beauty of of free market economics and supply and demand, isn't it? Those people that want to pay for that ticket. We've seen it historically with, you know, some of the world's largest events where you almost get these bucket list experiences that you are happy to invest in. Or whether you are a person that just simply cannot afford some of the prices that are on offer you and you are desperate to get into the event. I think what we need to remember on all in all of that is the secondary marketplace provides us with that access. And that's something about, I think, something really powerful about how you can use a secondary market to enable your access to that event, particularly when you know the primary. Are so few and far between.

Shaun Steward, viagogo 9:15

Yeah, I think that's very valid. I think in the end, the way FIFA will look at it after the World Cup is you have a range of different success metrics or measurements of whether this was positive or negative. Some of them are financially based. Did we sell more tickets? Did we make more money? Was the average ticket price higher? And what was the profitability of the overall World Cup? But then as you mentioned, success in any business goes beyond just the economics. You have a brand, you have fan experience, you have likelihood to return. Like do all of these things deteriorate the experience and end up causing fans to feel differently about the World Cup? is. Probably not. It's every four years. It's the, like the major event that we all remember from our childhood. It's like the Olympics. There's one or two of them that are just so substantial in sporting and events that I think demand will continue to be this imbalance that so many more people wanna event attend these events versus the ticket supply available. But it'll be interesting to see do people buy these price points? Do they buy multi-component packages? Do they show up at the level expected? And what's the impact after the event of how they see fifa, how they see the World Cup as an event and their likelihood to participate in the future.

Professor Rob Wilson 10:23

They tested it, didn't they? With the club? With the club World Cup. And we

Richard Gillis, Unofficial Partner 10:26

Yeah.

Professor Rob Wilson 10:26

the empty seats at that event, which kind of almost an unmitigated disaster from a broadcast perspective.'cause the broadcasters pay the big fees because they're looking at major majorly, full stadia. Just to close the point off though. Richard, the reality is FIFA will have to then reinvest all of this revenue that they generate. And it'll be interesting to see their balance sheet movements over the next three and four years to see whether or not they generate 10 or 12 billion, how is that money gonna be reinvested in the game?'cause we forget fi you know, FIFA is a not-for-profit organization that's supposed to be developing. Sport of football right across the globe, particularly in those underrepresented markets, but

Richard Gillis, Unofficial Partner 11:04

Yeah.

Professor Rob Wilson 11:05

a lesson in, in earned income economics.

Richard Gillis, Unofficial Partner 11:08

Sean, let's talk about secondary markets.'cause obviously that's the world that you are in. what could FIFA do? Is it a totally transparent process? cause fans will say, oh, well this is just a rigged market. They're ripping me off in some way. people are never happy, like Rob are never happy about spending more money than less on tickets. It's like saying I, I like paying tax. No one likes to pay more money for something than less, but just take me inside. At the secondary marketplace because I think it's interesting that they've created this, but, and I don't know what will happen and what could go wrong. We've talked about reputational risk, but what else is in that world, in your world that you think, okay, well yeah, good luck with that.

Shaun Steward, viagogo 11:52

Yeah, I mean, I think that's where. The disappointing part here is that the entire ticketing industry is shifting to a wider and more open distribution strategy. Overall, the concept of primary exclusivity is crumbling. As you see both in the courts, in the teams, the decisions of venues, they're moving towards greater control of how they price and distribute their tickets. But also a wider net of distribution, building infrastructure and integration. So the tickets are not only just sold on primary, but that secondary actually becomes another demand channel for rights holders and venues that they typically have been restricted access from. You think of it as ba, British Airways was never allowed to sell on Expedia or. Skyscanner or Kayak, they were told You can only sell on ba.com for 50 years. And not only that, but ba.com was run by Expedia. So you have like, you've given up your own direct website and you are forbidden from putting your tickets anywhere else. It sounds ludicrous when you consider it from a flight perspective. That's what's happened and evolved over the last few decades or since the mid seventies and the ticketing world. Now, what would've been exciting to see the World Cup and FIFA do is build the ability to distribute those tickets, remain in control of pricing, but put them everywhere. Allow customers to buy wherever they like to buy, which is what the open distribution strategy shift is delivering, is that people who like booking on SeatGeek or buying tickets on game time or on StubHub. That the inventory of the primary system is actually distributed far wider and available in all those places. Instead, what FIFA did was instead of building that network of distribution of what really is at the heart of open distribution is building a network to feed your tickets beyond just a single brand location. They built their own secondary, so they doubled down on the exclusive nature of it, which is we not only have an exclusive primary, we have now made it exclusive secondary, both controlled by fifa, so you can't really refer to that as secondary. It's just a slight extension to their primary platform, which is you buy the primary tickets and if you wanna resell'em, you resell'em through us as well. And we're taking the lift and we're taking, or a percentage of the lift is fees, as an example. So I think the disappointing is the entire industry is rapidly moving to this very different approach to global distribution of tickets. And the World Cup could set a tone of like, this is the way the future looks for ticketing. Instead they doubled down on the exclusive control that really we've seen for decades and that we know has led the ticketing world into a bad place. We have a lot of upside available for more open

Richard Gillis, Unofficial Partner 14:21

So again, I'm one of the people who gets confused about ticketing because you've got these terms that are important and they just need a bit of definition, and I'm using them and I just need to be careful. I'm using'em in the right way. So you've got the primary market. You've got the secondary market. You are talking about the open distribution, and you're talking about effectively a breaking of monopoly power. I can see a sort of analogy with the airlines. Can you just extend that for me? Just a step because I think I know what open distribution means, does it mean that there are lots of different secondary marketplaces that you then distribute the tickets to.

Shaun Steward, viagogo 14:56

Yeah, so traditionally a venue, an event, an artist a promoter or a team has picked a primary. They've picked who's gonna be the back end, who's gonna run the box office, who's gonna be responsible for their ticket distribution, all the way down to like when I scan a ticket at the Brooklyn Nets with my 8-year-old, that piece of hardware I scan my ticket on is owned by the primary company. Even the. hardware is

Richard Gillis, Unofficial Partner 15:17

can I just stop you there for a second, because obviously the in the news over the last week or so has been a, you know, a do department of Justice ruling in America, which is about Live Nation and Ticket Master, and it's been deemed a monopoly. is that what you are meaning there about a sort of preferred. Platform or what it, just use that as the example to explain what an open distribution is.

Shaun Steward, viagogo 15:38

Correct. So Ticket Master is the dominant primary. It's north of 80% of the primary market in the us, north of 60% in the uk. And those recent court rulings have. like most fans and venues and operators already knew, which is that 80% market share, you're a monopoly and 60% market share, you're a monopoly as well. And the impact of that monopoly can be positive or negative depending on the maneuvering and decisions of the monopoly entity. And in this case, this, it seems like a lot of it has been negative for the industry to have that much. Ticket distribution controlled by a single player. And so that's the primary construct is like you outsource the ticketing distribution of your event or your venue or your team. And so then you get to, well, what is secondary? And so what happened was once this primary system was set up. There were fans who had tickets, who wanted to resell them, and they, that gave birth to the secondary concepts of StubHub and game time and SeatGeek. And so for decades, these two have operated completely independently with like a garden wall Between the two of them, which is the team agreed that they only work with Ticketmaster as their primary, they can't participate on the other side of the wall. And the other side of the wall has been, the supply is sourced from two places. It's fans. You know, Rob buys a ticket to c Oasis, gets a headache, his wife doesn't want to go. They resell the ticket to, to make some money or to get their money back, or intermediaries, brokers, consolidators that have official or Unofficial relationships with the teams and or venues or at, and they're living off of an arbitrage. They pay for the ticket to take risk on the ticket, and they try to sell it in a profit. What started to happen is teams have asked the question of why can't I list my inventory directly on those channels? And the answer traditionally has been because your primary agreement says you can't. And for decades that answer was enough and people said, okay, fine. We signed a contract for a sponsorship check for a decade, and it says we can't access half the market. in the last three to four years, you've seen people finally say, enough's enough. We actually wanna access where 50% of the market is purchasing that people have a preference of where they buy tickets. Why are we limited from putting our inventory in front of these people? And there is where you come back to that core initiative of the rights holder, which they can use. This expanded access to distribution of global demand to either get face value tickets in front of more customers and eliminate that intermediary behavior. Or they can look at what was happening in these larger demand marketplaces. See what the price dynamic is and price at that market rate if they want to, which might be above or below what their face value is depending on it. this major change is for decades they've been told you have one primary, one path to market. One way people can buy tickets to your perishable product. And now it's happening. As people are saying, that doesn't make sense if half of the inventory for or half of the demand for sports is happening on these secondary channels. Why can't I be there? Why can't British Airways sell on Expedia or Kayak or Skyscanner? Because that's where the customers are looking to buy and that's that analogy with the flight industry that I think is quite helpful.

Richard Gillis, Unofficial Partner 18:41

Rob, there's also I think a US Europe question in terms of attitudes towards marketplaces. What do you think?

Professor Rob Wilson 18:50

Yeah. Attitudes towards marketplaces, attitudes towards regulation, you know, just to impact that primary point a little bit more. It's not just the ticket, but it's also, as Sean mentioned, kind of venue control, the distribution, ultimately the. The primary seller is controlling the fan experience, and I think there's a much bigger opportunity to do something a bit different with that. But the other point is, as well, we always freak out over price. So we see the big prices listed for, you know. I think Sean mentioned not so long ago, I never got near Oasis tickets'cause they sold out so quickly. And I wa I wasn't that in love with them, that I was gonna spend the money to buy a ticket. I know plenty of people that did. so people freak out, overpriced because,'cause it can escalate quite quickly. But that is naturally how economic markets work, isn't it? As the demand. Demand forces the. Because the supply is restricted. That's exactly what that, what we would expect to happen. What we need to remember is particularly some of these secondary markets, is that. That provides the access to those tickets often at a much cheaper price. So whilst we get focused so heavily on these big ticket items, the World Cup, in the Summer Oasis last year, and Taylor Swift Era's tours and so on and so forth, the reality is if you're trying to buy a secondary ticket in the US I think, you know. About 80% of them tend to be under face value. So this is genuine. People that are saying, I bought a ticket. I can't go anymore. Let me see if I can get some money back for that. For that particular ticket, we, I think quite rightly, get focused those unscrupulous individuals that are trying to force prices up and make big livings out of it. But the reality is that. It back to access for me, and that's where the open distribution, methodology comes into play. In terms of an economics case study, the more people you've got out there to potentially buy tickets, the better the rights holder will be able to receive the revenue generated with the event. But also from a fan experience perspective, it should be a much more enjoyable experience as well. a safe one actually.'cause it means you're not going to the dodgy garden, the corner to buy a ticket, which might not actually exist.

Richard Gillis, Unofficial Partner 20:59

Yeah, the other bit again, obviously we are talking about this and we've got an Olympics coming in, in the same marketplace in two years time, and ticket's always controversial and I think there's something interesting about the way in which the market is viewed by gut sports governing bodies because it's a very controlling. worldview. So it sees things like secondary markets or it sees EA games, for example, fifa, you know, said, right, we're closing that down. We're gonna not renew that license because we want to create the game ourselves. We wanna own that. Again, big question mark, whether actually that's possible for a governing body to do you see it in the obvious leaks are things like pirus, media, piracy and betting is the other one. So when you then talk to the betting industry, they say, We are taking the, your sport and putting it in front of a whole different audience and we are making it more interesting and entertaining. I'm not a bet, I've got no skin in that game, but I think it's quite an interesting. Debate in terms of what a governing body is, what it wants to be, how big, where the lines are, and what actually it views as helpful. You know, one person's leakage is another person's marketing strategy, so Sean, what do you think about that?'cause I think there might be a difference in terms of the attitudes. So something like StubHub and Viagogo is framed as leakage,

Shaun Steward, viagogo 22:23

yeah and that's where I think that's where direct access to that demand channel, whatever secondary channel it is for the rights holders, is such a valuable and attractive opportunity that they see it as leakage, not. Really because it's a demand center. It's a, it's an area of purchasing that they cannot participate in. And that is what is fundamentally changing right now and has been for the last couple years, is that every industry event I go to, it's not about StubHub's strategy for open distribution. As much as we appreciate that, we're kind of helping to push the industry forward, the debate is. For the industry, isn't open distribution better than the way we've been operating for decades? Like isn't it better to have control of your pricing and inventory through a central system that you integrate with as many different places as people are looking to buy from? American Airlines runs its own single inventory system that feeds out to every place on the planet. You can buy a ticket, whether it's a travel agent in Tokyo, or a website in Australia. It's all coming back to a single controlled system of inventory. So that primary source of truth doesn't change as a philosophy of how the ticketing industry is designed. But what changes is, instead of closing that system down and controlling it, so only one place can provide that inventory to a customer, it's doing the opposite, which is opening it up so that there's global distribution of the inventory, which is better for fans. Fans should be able to access it in the place they look for. I think Rob made a good point too, which is like investing in building your own secondary channel as a sports governing body. It's a hell of an ambition. This is not an easy task to do, especially for something with the traffic and the demand and the consequence of a World Cup. And as you saw in places like New York with price caps, I've lived in this city since 98. We've had price caps since 1922. that it drives the transactions underground. When there was price caps in New York, they all got repealed and by 2010, but before that, I was picking up tickets to the Knicks games At seven 11, I was buying them on eBay, getting in the back of taxis that would drive around the block to transac your ticket and cash that. That's what happened when these well established safe marketplaces weren't available to us in New York. So you really hope the World Cup is building a very robust and stable secondary platform because the consequences there of, you know, transacting with something unstable is a problem. And you see that in places where price caps have been instituted and the consequences, it drives all the behavior underground instead of on, you know, well-managed distribution channel.

Richard Gillis, Unofficial Partner 24:53

they also added a layer of price. FIFA added new, even more expensive tiers of tickets for this year's World Cup asking up to$4,105 for a front category, one seat at the US for open versus Paraguay in California. FIFA had asked. For a top price of 2,735 of category one tickets for the match, but added a new front category. Is it, is that normal? Is that something that, that you would expect at a major event that they would come out with a new tier of pricing? Or are they responding to something that, that they thought, actually we underpriced the tickets? Is that what's happening there?

Shaun Steward, viagogo 25:32

My assumption would be, yeah, they're responding to the activity they saw in the primary and these phase releases suggesting that demand was higher than expected. I think Rob mentioned like the events of last summer where there was concern around the lack of attendance that a bunch of these great games, real Madrid versus Barcelona, the Miami games were pretty well attended, but when you saw games in St. Louis and different areas of the country, was a lot of empty seats. And so I think. might've certainly caused some concern that like, listen, those were five and$600 tickets that weren't moving for very impressive clubs playing, even though it's an exhibition in the summer. so they might've gone into their primary release waiting to see the level of demand at different price points. That is what dynamic pricing is you sell low for a base of occupancy in the stadium, and then you gradually yield up as you see demand and the flexibility there. And so potentially the primary activity suggested to them there was more money to make here than they originally thought possible, and they redesigned their primary pricing and added a new tier, which comes back to that initiative of what's your ambition as a, as an event. Like, are you here to set a price that. You think is fair and don't want people paying above that, or you focused on maximizing revenue in a TP and open distribution allows both. And then the glass is half full, I guess, is that whatever profit they make, they should be reinvesting in the sport. They are a nonprofit entity. They're supposed to be the ones galvanizing and driving the growth of football globally. So maybe this is helpful to reinvesting all at all levels of clubs and performance that, that we haven't seen in the past.

Professor Rob Wilson 27:05

I think either way it wasn't a surprise to see it. It, the reality is that FIFA will have been tracking that data. They would've been seeing what was selling quickly, what were the, you know, where the real demand points would've been. And they're also, to go back to the point from earlier, they're also operating in a market that is highly mature in the context of commercial delivery seats. So, you know, it might be that you want. Almost a sofa esque style seat with a massive amount of space around you with table service, with drinks on tap for the for the entirety of the competition. A private room where you can go and make some business calls and so on and so forth. So they will have been seeing that. I think where the general public, and I would include myself as part of the general public when we review those types of things, it looks very. Very clearly as a way of market exploitation. The reality is they will have some very high net worth individuals that are following the US soccer team and are prepared to pay the big money for those seats for that level of exclusivity. I just think that to go back to a couple points you raised earlier, when you are a primary seller, you're the rights holder. You know, I'd like to see as a consumer, you know. A bit of transparency with my ticket pricing. I think the whole idea of the dynamic pricing outcomes can be unpalatable for consumers at times, and the number of those cheaper tickets that are supposed to enable, you know, greater access are naturally not there, but you know, to answer. Your question, Richard. In my view, it was very opportunistic from fifa and it was a response to what they were seeing with the data and the demand that was there for those really super premium tickets. And see it on the TV all the time. You know, if you watch Saudi Pro League, you've got people sitting in almost palatial style

Richard Gillis, Unofficial Partner 28:45

Yeah,

Professor Rob Wilson 28:46

those types of seats cost money.'cause you know David Beckham's gonna be on your right hand side and Leon Messi might be on your left.

Richard Gillis, Unofficial Partner 28:53

There is a difference it feels like, between say, a World Cup. Well, there should be a difference, you know, in terms of, there's a, you've got the framing of a premium sports and entertainment, global sports and entertainment event. As you keep mentioning that FIFA is a nonprofit organization. It's a Swiss-based nonprofit organization that is there for the good of the game. If it's the NFL, I get it. You know, the NBA, these are different animals, but this feels like it's. Got stuck somewhere in Mid-Atlantic and I don't think it's working, but that might be a very UK view.

Professor Rob Wilson 29:28

I think there is a level of UK acceptance with this. You know, we're used to. What's it, a 30 pound price cap on away tickets if you want to go and watch an away

Richard Gillis, Unofficial Partner 29:36

Yeah.

Professor Rob Wilson 29:36

it's all about trying to make sure that kind of access is broadened.

Richard Gillis, Unofficial Partner 29:39

we also romanticize, you know, a crap day out, don't we? You know? Shit. P shit. Pies and warm beer.

Professor Rob Wilson 29:49

Yes. And we also talk about traditional fans as

Richard Gillis, Unofficial Partner 29:53

Yeah.

Professor Rob Wilson 29:53

really, I struggle with the concept, what the hell is a traditional fan because. You know, gone are the days of a hundred years ago when, you know, only men that were working in a shipyard that would work all the way through the week

Richard Gillis, Unofficial Partner 30:04

Yeah.

Professor Rob Wilson 30:04

would save up all of the money, would go out on the Friday night, have a few beers, and then go and watch the game on a Saturday after they've done a bit of an overtime shift. So, so the whole demographic has changed, right? The access for. Professional sport for live events more generally has completely transformed over the last certainly 25 years since I've been looking in and around the space and as a almost a grown adult start to, to buy tickets to consume myself and and for my family as well. So I go back to US market is highly commodified. the other thing we need to remember is that the MLS as a product is really challenging the top four sports in the states as well. So, you know, if I'm a commissioner of the of major league baseball, I'm looking over my shoulder because I think the MLS is hot on its heels as becoming the fourth biggest sport in the states. Might even go into the top three. So, so you also have this huge amount of popularity. You mentioned it though, Richard. The reality is some of these emerging nations. In fact, some of the developed nations with people that are really keen on watching football or soccer might not even be a fault to get on the, on an airplane to go and watch this World Cup, let alone buy a hotel room because they're extortionately expensive around some of the venues. And then you've got the public transport system that fight the prices as well. So, so this whole thing becomes. A big ticket in Inver item, a bucket list experience. And golf analogy is interesting. A really good friend of mine has just got back from the masters in Augusta. He saved up for that trip for about the last decade. And he was waiting for a time when A, he could probably afford it, but b, when that bucket list experience for him was gonna be realized, and it happened that, you know, he's a big follower of Rory McElroy. It was looking like Rory was gonna. Win that master's title. So he was able to experience that and that will live with him for the rest of his days. And, I think we need to understand how that experience gets weighed into this argument as well. And there will absolutely be people that cannot access the matches. That would be good news for the home countries wherever you are domiciled because you know, your TV subscription is probably gonna be accessible in your house or you're gonna go. If it's in the down the pub with your mates and have a few beers and hopefully a better warmer pie.

Shaun Steward, viagogo 32:22

No, I think that's spot on. I think there's a, certainly a range of different elements that lead to this outcome, but one of the major ones is. As you just mentioned is bucket lists. Now are events, not things like people aren't like, one day I wanna wear a Rolex. Now they're like, one day I wanna go to the World Cup final. One day I want to go to the Stanley Cup final. My son just had his birthday. He didn't ask for a Nintendo Switch or a baseball glove. He asked to go to a Mets game or an F1 race. Like it's experiences that are so much more valued by people out there, music and live sporting. And so that growth in demand can be treated in different ways, which comes back to, in the end, the strategy of the rights holder of how they're using this growing demand, the limited supply. We work with the Ambassador Theater Group a TG

Professor Rob Wilson 33:07

That's

Shaun Steward, viagogo 33:07

the

Professor Rob Wilson 33:08

right.

Shaun Steward, viagogo 33:08

They have theaters in the West End and all the theaters on Broadway. We mirror their primary, we integrate to their primary, we sell the exact same ticket for Hamilton or Harry Potter or a Book of Mormon at the same price as it's on the primary, and we sell that on StubHub. so the result of that is that the transactions on StubHub that used to be a hundred percent either fan resale or into meters brokers and scalpers and consolidators. Now we're north of 80% of the tickets we sell for all of at TG shows are at primary pricing directly to a TG. And because that's their strategy, they could be saying, we're gonna market price it, whatever the, if we have to go up and down we'll see what level of demand we're seeing for Hamilton on a Wednesday night, and we'll match the market rate. But for them, the strategy is no. We've set a face value of the ticket. This is what we believe is a fair price to pay, and we wanna open up distribution as wide as possible at that price point. So the growth in popularity, the openness of distribution that's occurring are all very positive things. But the end pricing decision is based on the strategy of the rights hold of the venue, the team, the view of profit. And I think that's where FIFA and the reaction is so negative or so controversial is'cause they're a nonprofit. And so people expect them to have more of a strategy of like, this is a fair price to pay. Let's get people to experience the sport who haven't been able to see it before. Especially in a market like the us. But instead, the strategy seems to be maximizing on the cement supply demand equilibrium, which is heavily imbalanced. It's an event once every four years that everybody wants to go to. Even people who aren't football fans wanna go to the World Cup. It's on their bucket list. And you're seeing that play out now.

Richard Gillis, Unofficial Partner 34:45

How is it in America in terms of North America in terms of view the, this ticket conversation? Is it as febrile as it is here?'cause obviously people are getting properly worked up and there's, you know, almost every day. Lots of people on social media, but also on, you know, sort of the athletic and all the newspapers are really going after this subject of ticket prices at the World Cup. Is it the same in the states? Are they as exercised by it?

Shaun Steward, viagogo 35:10

Yeah, I think there, there's a lot of activity and debate about what's good and bad for the industry.'cause it is at a time when things are shifting dramatically it has been set in its ways for decades and a lot of that is breaking down rulings on monopolies, changes in distribution, technology changes in pricing. There's a lot of innovation occurring in this industry at a pretty rapid time. we've also lived through this before, which is we know when our team is terrible. The tickets itself are really cheap. On secondary, the Mets are going through a terrible streak right now, and you can get tickets for half of face value if you wanna go to a Mets game. on the other side of town the Knicks are battling the Falcons and doing incredibly well, great postseason and their tickets are skyrocketing and we're used to that as fans. What's great for us as New York sports fans as an example, is we used to have to go pay cash on a side street or at a corner of 54th and eighth and hope to hell, the ticket they just gave you is actually real. Because there's no chargeback on your credit card. There's no asking for a refund. You get scammed. You get scammed. And that's the way we worked in ticketing up until around 2010 when everything got repealed and we moved away from price caps. So yes, we're used to this supply and equi, demand equilibrium, playing out a hot show on Broadway, skyrocket. It's a terrible show on Broadway. You can get for 50 cents on the dollar. And that's been very common as residents here.

Richard Gillis, Unofficial Partner 36:30

It's quite.

Professor Rob Wilson 36:30

Yeah. And TAUs as well. When I went to the Knicks over Christmas, it was a case of we were there with the family son, really wanted to go. I lost count of the number of times I was offered tickets from a cabbie or or on a hotel concierge. In reality was, it was. You know, you need that consumer protection. If you're gonna use your credit card to buy something you have that level of guarantee, don't you? That means you can go in and there was an empty seat in the house. Nicks were terrible by the way, that night. I was hoping that we, they were gonna win. You know, we'd been talking about going for the previous 12 months and they were utterly awful. But it was a great experience and there wasn't an empty seat in the house. Everybody that was in there on a kind of genuine ticket and backed up because.

Richard Gillis, Unofficial Partner 37:16

It's quite an interesting sort of question. The other way. You mentioned there about sort of 80% of American events don't sell out and you know, the worst problem. The other problem, which we haven't really talked about, we are talking about something that we're expecting to sell out. It should sell out and if it doesn't, they'll be held to pay, et cetera. The other, you go to the other bit, which is empty seats. I was talking, we had Stuart Kane on here as the chief executive of Warwick Shear.

Professor Rob Wilson 37:41

Or

Richard Gillis, Unofficial Partner 37:41

And you know, I asked him, could you sell out a county game? And probably not. Is the, you know, whatever you, so there isn't a price low enough to get people in to enough people in to county cricket. You might, you know, you can then start to go around other sports events and he say, right, do you know what it's gonna be? Re it's more, it's about more than price. Sometimes, there is something else happening. Prices are obviously a central component to this, but if the hope is that low prices are gonna solve empty stadiums problems it's actually more complicated than that.

Professor Rob Wilson 38:18

Yeah.

Shaun Steward, viagogo 38:18

it's the marketing reach and arm of these teams has been limited to just what their primary, they've selected is capable of. And that's where discovery and marketing has a substantial opportunity. Now, as we open up this network, which is, you look at the 85 deals we've done since we launched kind of open distribution last year. Most of them are in new and upcoming sports, new festivals that have been launched that people don't know about. New leagues that have been created and are launching bringing new sports to new countries that traditionally haven't looked at it. And so what we can do as a marketplace is you can say, Hey, this person went to an indie car race. Maybe they'd be interested in attending F1, now it's coming to the us. Or this person has gone to baseball games. Maybe they'd be interested in women's softball or Olympic softball, and that kind of cross category marketing. Is where these marketplaces usually have the benefit and the power for supply, right? Is that you go to a website to shop for hotels on Expedia and you discover a hotel you've never heard of. That is what should have evolved in ticketing, which is these marketplaces should be out there generating demand for events that people aren't aware of. Instead that duty has been left just on the primary side, and so it's only been successful depending on. How strong the primaries marketing capabilities are and how big their reach is. We work with Manchester City and the Premier League. Last year we sold tickets for them from 140 countries. It's not like UK was a small piece of the demand we generated for that club, because there's people in KL in Malaysia, waking up today and putting on a Holland Josie and going to work or school. That fan base is just global in dynamics, and now you need marketing and discovery and distribution technology that's. Capable of reaching that global audience. This isn't just Premier League fans live in the UK and that's the only person who cares about a Newcastle game. It's very much evolved beyond that,

Richard Gillis, Unofficial Partner 40:10

That's a really interesting point. It's, it is the sort of anti leakage argument. Articulated really nicely. Well, listen, thank you so much. I might see you at the World Cup. You never know. You never know your luck.

Shaun Steward, viagogo 40:19

Yeah, if I if I get a big bonus or something, maybe.