Coldplay’s Mumbai concert began as just a musical event but now it’s become a symbol of the growing frustration with ticket and resale practices.
Within minutes of tickets going live on BookMyShow, they were gone, only to reappear on reselling platforms at much higher prices. This situation is naturally frustrating to fans, but it prompts us to think more about the economics of supply and demand related to concerts, and solutions that work instead of resulting in price controls and other destructive responses that have repeatedly failed every time they have been tried.
The concert excitement among fans has been tainted by a familiar issue: there are fewer tickets than there are fans, resulting in economic arbitrage (regularly denounced as ticket scalping). Minutes after ticket sales went live on BookMyShow, the tickets were already sold, only to reappear on reselling platforms like OLX at higher prices. Initially priced between Rs 2,500 and Rs 12,000, tickets were re-listed and sold for up to Rs 900,000. Unfortunately, this situation isn’t new.
Fans around the world have been dealing with the repercussions of slanted ticket practices for years. Whether it’s the reunion tour of Oasis in the UK or Taylor Swift’s Eras tour in the USA, major ticketing platforms like Ticketmaster have been accused of failing to protect real fans from bots and scalpers, igniting public outrage and inviting regulatory intervention. The Coldplay concert is a perfect example emphasizing the need to bring innovative solutions to the issue.
In a nation of 1.4 billion, the demand for live concerts vastly eclipses the supply, especially when global acts like Coldplay take the stage and when the number of venues and events is limited. With their first live performance since 2016, an anxious 13 million fans dashed to secure one of 90,000 tickets available on BookMyShow, the ticketing platform. The inevitable rush led to the website crashing due to traffic and various other actors coming in to sell the tickets at marked-up prices. The demand for Coldplay is unquestionable, but the fact tickets were resold for nearly a hundred times the original price is a market signal that we need to take seriously.
It is tempting to think of prices as purely administrative decisions (the whim of companies like Ticketmaster) and focus on finding the “right” price for the occasion. As such, authorities have contemplated the introduction of price controls, installing a legally mandatory ceiling such that every ticket must be cheaper than the established number unless companies and sellers want to face penalties or prison. Tempting as they may be, price controls do not erase the underlying reality that there are fewer seats than fans. By signaling to buyers that there are more concert spots than there actually are, ceilings result in shortages, which means hours or dayslong queues for anyone waiting to go to the concert.
At best, price controls waste everybody’s time, energy, and resources, as neither sellers, buyers, nor the artists themselves benefit from excessive waiting, and many people never make it to the performance. At worst, they push the underlying reality into the black market and make consumers less safe. On the other hand, dynamic pricing is an actual solution to the problem, allowing prices to function as the signal of availability they usually do and change in real-time to reflect underlying conditions. This concept has been prominently used by hospitality and aviation industries for years to regulate the fluctuating demand without limiting the number of tickets per person or installing artificial ceilings. This makes it especially effective for high-profile concerts, ensuring prices are based on demand without breaking up the experience with tiered offerings.
This method ensures tickets are sold at the maximum price that consumers are willing to pay and the minimum price that sellers can accept. This method also minimizes the number of unsold tickets and allows more fans to have fair shots at tickets across various price points, removing the market for ticket scalpers in the first place. Tailoring the prices per demand will also make the ticketing system more accessible, allowing the platform to capture the value directly, which is reflected in investment (like more venues and better quality sound), thereby enhancing the consumer’s experience and letting everyone enjoy the fun of music.
One objection to dynamic pricing is potential inequality, in that only wealthier fans can afford to pay for some tickets. However, the more transparent and structured approach of dynamic pricing is an advantage for the less well-off in that they can be the first to grab tickets and plan ahead. Let those who can afford more pay the higher price of being late to the party. And, of course, allowing fans to have a better chance at purchasing tickets legally is infinitely fairer than the black market.
Coldplay’s concert in Mumbai has once again exposed the flaws in the ticketing industry. But instead of repeating the same cycle of fan outrage and platform crashes, it’s time for India to lead the way in addressing ticket scalping. By refraining from destructive policies like price controls and opting to allow for dynamic pricing, we can create a fairer system that allows genuine fans to enjoy live music and have a good time.
Originally published here
