One of the nation’s largest sports and entertainment companies is taking a crack at scalping.
StubHub is out as the official ticket reseller for Anschutz Entertainment Group’s venues, including the Los Angeles Staples Center, as it turns to its ticketing subsidiary AXS as its preferred resale site, according to the companies.
The new arrangement, which also rolls out AXS’s digital ticket technology to 30 of AEG’s venues and sports franchises in the U.S., is intended to give performers, teams and venues more control over how and for how much tickets are sold and resold—and to allow them to realize more of the true market value of their tickets.
The deal is the latest sign of the collapsing distinction between the primary and secondary ticket markets—that is, when tickets are first sold for face value versus when they are resold by brokers or fans, often at a markup. Offering resale tickets means an event is rarely declared “sold out.”
“You never want to be in a situation where you have to turn away a fan because you don’t have something to sell them,” says AXS Chief Executive Bryan Perez.
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Ticketmaster has been increasingly aggressive about presenting shoppers with a mix of face-value seats and tickets being offered for resale. That has helped siphon market share from resale sites like StubHub, whose contract with AEG expired this summer.
That market share is lucrative: A ticketing company will typically collect around $3 on a ticket sold for face value; the profit on the secondary market can be nearly a quarter of what the ticket is sold for, according to people in the industry.
The resale market is massive. Some 3,000 to 4,000 tickets are resold for any given major sporting game and the best seats at a concert can be resold for many times their face value.
With the rise of the secondary market—worth some $15 billion a year, according to industry estimates—the primary seller of the tickets is effectively relegated to a middleman role, with contact with a dwindling share of the people actually attending events. When brokers snap up swaths of tickets and resell them on other sites, the primary ticketer as well as the artist or team don’t know who buys them or how much they paid. They also don’t get a cut of the final, market-value sale.
To be able to track tickets—and the people buying them—AXS says it will now tie every ticket sold to the purchaser’s identity. Each customer will have their own AXS account through which tickets can be bought, sold or transferred to other customers.
That means that venues, teams and artists can know a lot more about who is walking in the door at events.
“This lets you go from knowing a third of the people in the building to potentially everybody in the building regardless of if they bought it on primary or on resale,” says Mr. Perez.
And delivering tickets via cellphone opens up a communication channel through which an event owner can, for example, help show fans where their seats are or offer a coupon to a food vendor they have visited before.
While it will still be possible to sell an AXS ticket on a third-party site—including StubHub—the process via AXS’s own is intended to be more convenient, in part because transfers need to be made from one AXS account to another anyway.
AEG’s previous deal with StubHub facilitated easier transfer and secured tickets’ authenticity through a direct integration with AXS.
“We will continue to list tickets for AEG events and venues globally,” said Perkins Miller, StubHub’s general manager for North America.
AEG venues covered by the new setup include Staples Center in Los Angeles, New York’s PlayStation Theater, Target Center in Minneapolis and Sprint Center in Kansas City. The company is also the nation’s second-largest concert promoter, runs the influential Coachella Valley Music and Arts Festival and owns or co-owns sports teams including the National Hockey League’s L.A. Kings and Major League Soccer’s L.A. Galaxy.
Write to Anne Steele at Anne.Steele@wsj.com