Cash Flow

Sports ”Revenue Managers” Scalp Fans

Professional teams are profiting from online brokers and stand-alone sites, but are they eroding fan goodwill?
Dave CookApril 14, 2004

Many professional sports teams that once shook their finger at ticket scalpers are now apparently profiting from the practice themselves.

Although 31 states have some variety of anti-scalping laws on the books, they were designed to rein in street sellers who gouged fans and, sometimes, passed counterfeit tickets. Those laws don’t seem to be applied to online services like,, and

The Seattle Mariners, the Green Bay Packers, the New York Jets, and five other pro teams ask season-ticket holders to sell unwanted tickets on, according to Business Week. Visitors to the StubHub site buy and sell tickets, either at a set price or on an auction system.

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Like eBay, StubHub doesn’t hold inventory; it simply acts as a meeting ground for buyers and sellers. The company charges the seller 15 percent and the buyer 10 percent of the sales price, according to the Sports Business Journal, and typically shares the revenue with its client teams. Another 18 pro teams have set up their own individual sites with the help of Ticketmaster, reported Business Week; teams and Ticketmaster split a cut of between 5 percent and 10 percent of the selling price.

Backers of the “sports team as scalper” business plan point to airlines that use similar revenue-management techniques to extract the greatest value from their offerings, said Business Week. The magazine added that StubHub clients collected close to $100 million last year, according to president Eric Baker. (To find out more about baseball’s economic worries — such as how teams struggle to balance ticket supply and demand — read “Squeeze Play.”)

Not everyone appreciates getting “squeezed,” however. When the Chicago Cubs withheld some tickets two years ago, then sold them through a broker affiliated with the team’s parent company, Cubs fans filed a class-action lawsuit, according to Business Week. Fans lost in state court, added the magazine, and the case is headed for an appeals court, but fan goodwill might be headed nowhere. Said Chicago cabbie and lifelong fan Randall Galles, according to the magazine, “I’ll never buy another Cubs ticket in my life.”