New York Yankees Don't Understand The Free Market

Baseball's ultimate capitalists don't like fans buying tickets for the prices they're actually worth on Stubhub.

The New York Yankees are known for being

Flickr/Wally Gobetz

Major League Baseball's financial juggernaut, taking in monstrous amounts of revenue while putting out rosters with payrolls that frequently push the $200 million mark. Historically, they have unapologetically embraced capitalism, usually to the benefit of their fanbase. That is, until their fans figured out how to score below-face value tickets on Stubhub.

In response to this technological advance in customer service, the Yankees announced they will no longer accept print-at-home tickets (a common and convenient method for customers of the secondary ticket market), ostensibly to combat fraud, even though Stubhub claims its customers encounter fraud in a mere .01 percent of transactions. 

Feigning concern that fans would be ripped off, Yankees COO Lonn Trost admitted in an interview with WFAN radio that the real reason for banning print-at-home tickets was to protect the feelings of the high-rollers who overpaid for their premium seats and to keep those customers safe from the presence of less ostentatiously wealthy attendees who may have (gasp!) "never sat in a premium location."

As a lifelong Yankee fan who has grown to loathe the class warfare directed at the fanbase, I took the team's tone-deaf elitism to task in a new column at The Week:

Ever been bumped from a flight, only to win the lottery by getting a free First Class upgrade on the next flight? Ever had to endure the glares from a passenger who just knows from the way you wiped with your warm towelette that you just don't belong in the rarified air of the front of the plane? Trost feels that guy's pain.

Regarding Trost's concern for the class of fan (who rarely show up for games anyway) that might have buyer's remorse for spending more than a grand to attend a regular season baseball game, I wrote: 

Let me put it plainly: The person spending $1600 to sit behind home plate is a chump. The seat is not worth that much. If it were, the fan that scored the seat for a third of the price on Stubhub wouldn't be there. The Yankees built the new stadium before the 2008 financial meltdown and baseball's ultimate capitalists refuse to accept that the revenue projections they relied on back then have plainly failed. The "Legends" seats are simply not worth what the team is charging. It's called supply and demand, a concept apparently lost on the class of rich and entitled fans who Trost so fears will be "frustrated" by his/her fiscally irresponsible choice to buy a full-price ticket.

Read the whole thing here.

Comments

[Diane Reynolds (Paul.)]

That is, until their fans figured out how to score below-face value tickets on Stubhub.

I have to admit, when I read the title of the post, that the tickets would be going for higher than face value. I am relieved.

[Diane Reynolds (Paul.)]

*i thought that*

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[Pl?ya Manhattan.]

Me too.

But it's about the darkies sitting in the nice seats. Irish hardest hit.

[WTF]

It's more "lower class" white people scoring those seats on stubhub, since even below face value they are still kind of pricey. I know, I've done it a few times.

[Zeb]

What, so black people are all poor? You're as bad as Irish.

[Episiarch]

Steinbrenner would never have done this.

Ahahahahahahaha I crack myself up.

[Tonio]

A big revenue stream does not make an organization capitalist. After all, governments have huge revenue streams, but that doesn't make them capitalist. And don't forget the anti-trust exemptions, taxpayer subsidized stadiums, etc.

[robc]

Anti-trust exemption is capitalist, but they didnt necessarily get there for the right reason.

[Hugh Akston]

Yankees fans have had to contend with the riffraff since ticket prices went down.

[Swiss Servator]

Damn...that was good.

[Irish ?s ESB]

How is it an attack on the free market for a private institution to decide what kind of tickets are accepted to enter their premises? If you don't want to pay the higher prices the Yankees are trying to force you to pay, then just don't got to a Yankees game. That's the free market in action - Yankees are trying to jack up their ticket prices and fans have the choice whether the higher cost tickets are still worth it.

"Baseball's ultimate capitalists don't like fans buying tickets for the prices they're actually worth on Stubhub."

I think you're the one who doesn't get how the free market works. A baseball ticket has no actual worth. It's value is whatever the Yankees are willing to sell it for and whatever someone else is willing to buy it for. This reminds me of leftists whining about 'price gouging' during storms by arguing an expensive flashlight during a storm is being sold for 'more than its worth.' Of course it's not being sold for more than what it's worth - it's being sold for exactly what it's worth when you're in the midst of a massive, storm-caused power blackout.

[Rufus The Monocled Derp Slayer]

I agree Stubhub's prices doesn't reflect what they're actually worth. It's just a transaction in the secondary market where price is set by the seller of those tickets. The actual worth is what the team says it is.

[Pl?ya Manhattan.]

Not sure if serious

[Rufus The Monocled Derp Slayer]

Whaddya mean?

[Pl?ya Manhattan.]

The actual worth is what someone is willing to pay.

[Swiss Servator]

"The value of a thing is what that thing will bring"

[Agammamon]

Since when?

Actual worth is whatever government says it is. That's why a minimum wage is so important.

And why its so unfair that Ke$sha gets paid more than a kindergarten teacher.

[Rufus The Monocled Derp Slayer]

Yeah. I see my error and I even made that point down thread.

Logical consistency is hard!

[Sudden]

Worth and value are wholly unrelated concepts.

[Irish ?s ESB]

That doesn't change that the Yankees can accept any kind of ticket they want to enter their stadium so it isn't a free market issue.

It's a dick move and their fans should be pissed off and punish them by not going to games. It just has nothing whatsoever to do with free markets.

[Restoras]

Their fans don't go to games already - the Yankees make that up by forcing everyone that has cable in the NYC area to pay $5.00 a month to watch games. Even if you aren't a fan.

[Hugh Akston]

The team can say the tickets are worth a bajillion dollars each, but its hard to take that seriously if nobody buys a ticket at that price.

[Ed Kline]

The actual worth is what people are willing to pay for it, not what the team says it is.

[Irish ?s ESB]

Except the team can determine who gets access to their stadium so the price is exactly what they say it is provided they have a way of stopping lower price resales.

And so long as that doesn't involve government force it's not an issue of free markets.

[Pope Jimbo]

Where to the tickets stubhub is selling come from? Are they getting them from the Yankees? Or are they reselling tickets that come from people who have already bought tickets but can't use them for some reason?

Sorry I'm ignorant on this, but I have never used Stubhub.

If the tickets come from the yankees, then I agree that they have every right to impose whatever limitations they want on them. Even if it is a stupid and short sighted move.

If the tickets come from people who purchased the tickets from the Yankees but can't use them for some reason and just want to get rid of them, then the Yankees can go pound sand.

[Irish ?s ESB]

It's second hand resale, so the second one. But how does that in any way impact if this is a free market violation or not? It's not an attack on the free market at all because there's no government intrusion.

Again - dick move, but fans can always show their displeasure for dick moves by getting rid of their season tickets if they don't like the new terms.

[Pope Jimbo]

If it is a resale, the Yankees already got their money. They sold the ticket for what they thought was was fair. What happens after that transaction is none of their business.

[brokencycle]

It still is their business. Landlords can say "no subletting." Why can't event holders say "only the original purchaser can redeem the ticket" or "reselling of tickets only allowed if x"?

Now, I think it is a dick move and a stupid move, but an owner of property should be allowed to say who gets to enter.

Of course, the Yankees are government subsidized crony capitalists...

[Restoras]

I have a funny feeling this isn't a problem for the Yankees or anyone else once they reach post-season and suddenly the secondary market for tickets balloons.

[See.More]

Except the team can determine who gets access to their stadium so the price is exactly what they say it is...

"Price" and "worth", or value, are two different things. If nobody is willing to pay the sticker price, then the price does not reflect the actual value or worth of the product.

[Restoras]

Correct. The actual value is reflected in the secondary market.

[brokencycle]

The seller or producer of the good still measures the value of the good. If a widget sells for $2, they can decide that isn't worth their effort just the same as a buyer can decide the widget isn't worth the $3 it is being offered at.

[Restoras]

No, the transaction between two individuals determines the value of the good.

[brokencycle]

It determines the agreed upon value. Someone could pay less than they think something is worth as an example. Again though, why can't the seller of a good put restrictions on how that good is used? Obviously that would change the value of the good, but it is certainly a legitimate thing that happens in transactions all the time.

[Diane Reynolds (Paul.)]

I started typing another message, realized it didn't really apply to this situation, so let me ask, what are your thoughts on the concept of ticket scalping where the organization has laws passed making it illegal?

[Irish ?s ESB]

They shouldn't be able to pass laws making it illegal. That's different than saying 'we're not accepting this kind of ticket anymore.'

One involves government force the other involves Yankees being assholes as the Yankees usually are.

[Diane Reynolds (Paul.)]

That's why I didn't finish my original message. I skimmed the original post and for some reason had it in my head that this was more of a ticket scalping situation. But it's not. I agree, the Yanquis have every right to not accept a printed ticket.

[wareagle]

there is nothing free market about professional sports. Each league is a cartel. The lie here professional sports having actual capitalists.

It's value is whatever the Yankees are willing to sell it for and whatever someone else is willing to buy it for.
This statement has two clauses; the author is noting that the second does not necessarily correspond with the first. That's EXACTLY how a free market works. The market, through outlets like Stubhub, is setting the price for this particular good. Am I missing something in what you're saying?

[Irish ?s ESB]

This is a good point and I didn't think about it enough.

Still, that doesn't change that the Yankees can choose who they let in provided they don't defraud anyone. How is this a free market issue in any sense when the government isn't involved at all and it's a private entity deciding the terms on which you're allowed on their property?

[wareagle]

isn't the anti-trust exemption afford professional sports govt involvement? All I am saying is that these leagues exist outside the usual conditions of a marketplace. The Yankees are certainly free to set their own admission policies but this one seems based on something less than concerns about fraud.

The NFL got around this by either creating or partnering with a website where ticket holders can sell individual game tickets if they can't go to a game or don't want to. I imagine there is some vetting process to assure that the sellers are bona fide season ticket holders and, as best I can tell, there are no ground rules for asking price.

[Irish ?s ESB]

"isn't the anti-trust exemption afford professional sports govt involvement?"

That's a completely separate issue. These stadiums getting paid for by tax payers is also a shitty government intervention. That doesn't have to do with this issue at all though.

[Roger the Shrubber]

I am an NFL season ticket holder. If you use the NFL partnered ticket resale website, you cannot list for less than face value. For my team, at least, you are able to transfer ticketed via email free of charge, so you are able to sell for less than face value, just not list online for resale.

[Old Man With Candy]

How is this a free market issue in any sense when the government isn't involved at all

Other than paying for their fucking facility and granting insane tax breaks?

[Irish ?s ESB]

So fucking what? We shouldn't do that. We're in agreement. That's also a complete side issue to whether it's a violation of the free market to determine who can enter your games and on what terms.

[Old Man With Candy]

It's not a free market- it's a government established and subsidized cartel.

[Irish ?s ESB]

And that's the aspect that's not free market. We aren't talking about that though, we're talking specifically about one example of Yankee ticket acceptance policies.

They'd be a state subsidized cartel no matter what their ticket policy is, so you bringing that up in this situation is a total red herring.

[Old Man With Candy]

No, it's about the right of the state to intervene in a transaction. If the organization is funded by the state, tant pis, the state can (and will) tell the Yankees who they can and can't let in.

If the Yankees hired you as their GM and you (as we all know you would) decided to ban Negroes from any of the lower deck seats, would you claim that this is the free market and that it's your right? Could HM be allowed in the mezzanine?

[Heroic Mulatto]

Could HM be allowed in the mezzanine?

How do you know I'm not Derek Jeter?

[wareagle]

this goes back to the earlier point: professional sports leagues are not a free market, not in the way most people define the term.

[Pl?ya Manhattan.]

They are defrauding corporate season ticket holders by suddenly telling them that they can't sell unused tickets.

I guarantee you that several lawsuits will come of this.

[wareagle]

that's a fair point though a lot of corporate ticket holders use them for taking out customers, internal incentives, and eventually, tax write-offs. No one forced the corporate folks to pay insane prices in the first place.

[Irish ?s ESB]

^^^ Okay, this is a good point I hadn't considered. Is that really defrauding them though? Did the Yankees initially say 'oh, you can resell our tickets?'

And couldn't you deal with that by saying 'this takes effect next year' so that anyone who doesn't like it can sell the season tickets due to forewarning?

[Pl?ya Manhattan.]

Sure they could. But doing so would lower the price of season tickets by at least half.

[John]

They are defrauding corporate season ticket holders by suddenly telling them that they can't sell unused tickets.

Only if the terms of the original sale said the buyer was entitled to resell the tickets. And, most importantly, the terms of the original sale did not give the team the right to change the terms at any future date.

I seriously doubt the Yankees terms of sale did not reserve the Team the right to change the terms later or restrict ticket resale or both. And therefore, there is no fraud here.

[Zeb]

The Yankees are preventing a free market in Yankees tickets. They have no obligation to allow one, but I think it's still a fair description of what they are doing.

[The Last American Hero]

Stub hub doesn't set the price, they are a clearinghouse. I could go on there tomorrow, and set the price for a ticket for an upcoming event at $2. When some friends moved, I sold their tickets to a concert through Stubhub a couple years ago and it was awesome. They show you what the tickets are currently being sold for by other ticketholders so you can decide if you want to undercut the going rate and move your ticket or hold out for more money. The process of transferring the ticket was painless.

[robc]

Cartels are free market.

Start an opposing league, its been done ti.e and again. The American League was a bit more successful than the Players League or the Federalist Leahue.

[Rufus The Monocled Derp Slayer]

Isn't attendance down? This strikes me as perhaps ill-advised?

/quietly takes 'buy Yankees tickets on line' off summer bucket list.

[Reactionary Moment]

Nothing anti free market in a private business seeking to maximize revenue by restricting access to discount tickets.

[Heroic Mulatto]

Except for the 1.8 billion dollars of taxpayer money spent to built said stadium.

[Heroic Mulatto]

build

[Reactionary Moment]

That is an entirely different issue than this.

[Heroic Mulatto]

Is it? Having a little over 50 percent of your stadium subsidized with public funds stretches the term "private business" to its semantic limits. You know, something about "pipers" and "calling the tune".

[Pope Jimbo]

Nope, in our cronyist system you can dig right in at the public trough for millions upon millions, yet somehow retain all the benefits of being a private entity.

See Black Lives Matter trying to protest at the Mall of America. The MOA can arrest the protesters because it is technically private property despite taking in taxpayer money hand over fist.

[Pope Jimbo]

Nope, in our cronyist system you can dig right in at the public trough for millions upon millions, yet somehow retain all the benefits of being a private entity.

See Black Lives Matter trying to protest at the Mall of America. The MOA can arrest the protesters because it is technically private property despite taking in taxpayer money hand over fist.

[wareagle]

it's more than the subsidies because those apply to a host of enterprises that ARE considered free market. Govts use all sorts of goodies to lure various businesses. What separates pro sports leagues is that they are cartels.

If you don't like govt giving, for example, Hyundai favorable treatment for building a plant, you have a host of other car-buying options. Leagues are limited to however many franchises exist; starting a new one is a long and very expensive process, one that existing ownership can make even more difficult.

[Irish ?s ESB]

Agreed - and it's also impossible to start your own league because the existing leagues get all kind of state goodies that make it impossible to compete with them.

It's a complete garbage system and no one's denying that.

[Reactionary Moment]

That is an entirely different issue than this.

[Old Man With Candy]

That's different. It's not taxpayer spending, it's "investment."

[Rhywun]

The owners and players get rich, taxpayers get the shaft, and fans don't give a shit as long as their team "wins".

Ain't it great?

[Old Man With Candy]

Yankees fans deserve to get shafted in any way possible. Evil organization, and has the Steinbrenner Stench.

[Rhywun]

Meh... it's not like every other team doesn't wish they had that kind of cash to throw around.

[Pay up, Palin's Buttplug!]

This is called "a well regulated market".

[kbolino]

Were there restrictions attached to that $1.8 billion concerning the resale of tickets?

That's the materially relevant question, and it has nothing to do with "violations of the free market".

[Restoras]

Nothing anti free market in a private business seeking to maximize revenue by restricting access to discount tickets.

Except, it doesn't maximize revenue. The Yankees have already sold those tickets. They've already 'maximized' their revenue on the sale of the seat. When those ticket holders don't show up, and the seat is empty, they lose revenue on concessions and parking for that game.

It's a stupid move on the part of the Yankees.

[wareagle]

why would you expect an outfit operating in a controlled, collectivist market to understand the free market?

[Pope Jimbo]

It isn't just the mighty that are harmed by the evul stubhub. The noble street entrepreneurs are also getting killed.

It doesn't matter what [price] I'm selling them for if everyone who is here doesn't need a ticket," said Jason Gabbert of Metro Tickets. "Look at the [box office] windows. No one is buying tickets. When the games aren't sold out you have no leverage, because fans know there is minimum amount they can pay to get in."

The local paper loves writing stories about how any group of people are being harmed by the free market. Never mind that fans get to save lots of money, the poor scalpers are being harmed!

[Rufus The Monocled Derp Slayer]

Whatever. The only thing I care about is what I'm willing to pay. I've bought, as many here I'm sure, hockey tickets in the past below face value on the ticket.

[Pope Jimbo]

Rufus, I was making fun of the paper suddenly caring about scalpers because they are losing their shirts to stubhub.

In the past the paper was against scalping but now that they are economic victims of changing times, the paper loves them.

I also love the fact that the promised economic boom of Target Field lasted all of two years before the horrible teams drove off all but the most committed of fans.

[Trigger Hippie]

Mauer remorse?

[Pope Jimbo]

I've been a Mauer denier since the day he started playing for the Twins.

He is a good player, but his temperament is that of a Scottie Pippen, not MJ. No way he should have gotten that much money.

Of course, if the Twins hadn't overpaid him there would have been riots. They had just gotten their new stadium approved and if they didn't keep their local boy star the howls would have been heard in Yankee stadium.

The upside is that the Twins learned from their mistake and haven't paid anyone, star or not, since then. They went right back to old shitty cheap Twin mode and now have shitty Twins teams that haven't contended for a decade.

[Pay up, Palin's Buttplug!]

In the past the paper was against scalping but now that they are economic victims of changing times, the paper loves them.

With apologies to Ronald Reagan?

The media's view of business could be summed up in a few short phrases: if it moves, advocate taxing it. If it keeps moving, advocate regulating it. And if it stops moving, advocate subsidizing it.

[Rufus The Monocled Derp Slayer]

I know. What I meant by 'whatever' was in reference to the story you linked to.

[Pope Jimbo]

Sorry clipped this part of the quote somehow.

Longtime scalpers believe the StubHubs of the world slowly are killing their business. If everyone has a ticket before they come to the ballpark, there is no reason for their existence.

[wareagle]

scalpers being shut out does not bother me. Seen and heard of too many instances where people buy fake tickets. Yeah, I know - buyer beware. But fraud is not a problem on stubhub or ticketmaster or places like that because those sites have every motivation to prevent fraud.

[Old Man With Candy]

noble street entrepreneurs

Hey, Mister, I can tell you where you got them shoes!

[Adam330]

This seems likely to backfire on them. Previously, if I bought season tickets but knew that I wouldn't be able to attend every game, I knew that I could still sell the tickets online and get back some portion of what I paid. This of course increased the effective per-game price somewhat, but I'm sure plenty of New Yorkers were fine with that. Now, the Yankees are effectively saying that if I don't use a ticket, I have to eat the entire ticket price. That increases my effective per-game price by quite a lot if I'm not attending a lot of games. And it may be enough that the Yankees can no longer sell those season tickets at the same face value. In addition, people that pay below face value prices still buy beer, concessions, etc., which is significant portion of revenue.

[Pl?ya Manhattan.]

Most "premium" seats are corporate season tickets. If they have a problem with it, just make the seats non-transferrable.

[Roger the Shrubber]

I believe that the whole point of a corporation having season tickets to sporting events is that the tickets are transferable.

[Pl?ya Manhattan.]

Yep. And if they suddenly aren't, nobody is going to pay retail.

[John]

Who are you? Ronnie Mervis?

[John]

Does anyone at reason actually understand how markets work? There are good reasons why the Yankees lose out when people scalp their tickets. If people are able to buy last minute tickets on sub hub for below face value, this creates an incentive not to pay the prices the club is charging and just wait until the last minute and buy a ticket from someone who can't go.

Understand, the Yankees own the product. They are free to offer it under any terms they like provided they inform the customer fully. They therefore are totally free to sell their product with the stipulation it can't be resold. If the buyer doesn't like that stipulation, he is free not to accept the deal.

[Irish ?s ESB]

Exactly. People seem to be mistaking not liking the decision with an attack on free markets.

I think what people don't understand is that the product is not the TICKET, the product is the GAME. What the Yankees are actually selling is game access, so they have the right to offer that game access on their terms.

[Mickey Rat]

The point of a free market is to sell a product in the fashion you want with the stipulations you want. The market will decide if those decisions succeed or fail. Whether this is a good decision is something the market will tell the Yankees this season.

[Fist of Etiquette]

I felt the same way when they came out with HBO NOW. How dare commoners have the same access to HBO as I have, a premium channel subscriber for years.

[Pl?ya Manhattan.]

I just cancelled my HBO. And my Showtime. And my Skinemax. And my landline.

[Rhywun]

I'm *trying* to cancel HBO but the fuckers at Time Warner claim my bill will "go up".

- "You have a special package sir."
- "Then why am I paying like twice the advertised rates in your commercials?"
- "Those are for new customers sir."
etc etc etc

[Diane Reynolds (Paul.)]

I too have a special package.

[Rhywun]

You know who else had a special package...?

[Swiss Servator]

*narrows gaze*

[Crusty Juggler]

I just cancelled my HBO. And my Showtime. And my Skinemax. And my landline.

Soon you will be just another cord-cutter, like the rest of us poors.

[Fist of Etiquette]

I DON'T EVEN OWN A TELEVISION

[Je Suis Reason (Fmr. AuH20)]

First of all, fuck the Yankees.

Secondly, I'd like to take a moment to congratulate Jenrry Mejia, because of FUCKING COURSE it would be a Mets player who was first to pick up a lifetime ban.

Anyway, the Mets have some guys coming up this season, and good starting pitching, while the Yankees are sticking it all in the bullpen. I like the team in Queens' odds a bit better, but I am heavily biased as a fanatic for the Metropolitans of New York.

[Rhywun]

"Jenrry"? Come on... *googles, facepalms*

[Rasilio]

"As a lifelong Yankee fan "

And with that statement you have officially become the worst writer to ever appear on this page

[IceTrey]

Anyone who pays $500 for a seat behind home plate is a chump.