Worst of Both Worlds!: Disney, Ticketmaster, Scalpers, Economists HATE Squeeing

Imagine you are a tween girl, obsessed with the Disney phenomenon Hannah Montana. You want to see the live performance, showing Miley Cyrus, as both herself and as her tv-alter ego — who has her as an alterego. But tickets sell out immediately!!!1!!!

The cynical among us could dismiss Hannah Montana as an “invention,” created by Disney over three years to get the

faux pop star [right], minutely calibrating her appeal to the 6- to 14-year-old market and, less obviously, to their parents. Disney did a great job: Hannah Montana is a funny, independent-minded girl who encourages listeners with lyrics such as “No one’s perfect” and “Don’t let anyone tell you you’re not strong enough.”

Or we could be cold to the hearts of tweens, explaining this situation as does a writer for the Fed, Doug Campbell, dismissing the scalping as a market failure:

it may be unfortunate that some little girls won’t be able to see Miley Cyrus (the real name of the performer who plays teenybopper Hannah Montana) in concert. The more fundamental issue is that promoters of the Hannah Montana series apparently haven’t priced tickets commensurate with demand, opening the door to a secondary market with much higher prices.

The Hannah Montana concert controversy has led to some upset parents suing the official fan club, or having the state attorneys general of several states look into whether there was any illegal activity. According to the parents, the fan club promised tickets for concerts with membership (the fan club says the chances were only increased). What control fanclubs have over concerts and how closely connected they are to the actual performer ranges greatly; Radiohead tried a similar relationship between the fanclub and concert goers to attempt to avoid scalpers; Metallica keeps a very tight reign on its fanclub; and during various artists’ battles with their record companies (Prince, Nine Inch Nails) how “official” could the fanclub be if it was more closely tied to the record company?

While adults can “understand” Ticketmaster’s practices for charging enormous service charges, scalpers’ uncanny ability to buy up tickets before true fans, and the different ways that fan clubs actually work, (and in this case Disney’s decision to limit the number of tickets greatly below the size of the venues), kids feel a strong emotional connection to the object of their fandom and don’t care why this disappointment happened. We all know someone (or are that someone) who cried for weeks about the inability to see (fill in the blank) _______ (the Beatles, the Jacksons, Peter Frampton, KISS, Wrestlemania, Duran Duran, the Cure, Bell Biv Devoe, New Kids on the Block, Nirvana, Spice Girls, N*Sync, Destiny’s Child, My Chemical Romance, and other tween/teen obsessions). The feelings of these kids cannot simply be brushed aside.

Farhad Manjoo of Salon suggests a “true fan” option to cut down on scalping of tickets:

Make people take a quiz to get tickets to their favorite acts. I’m serious. Here’s what I mean. When you select “Hannah Montana” on the Ticketmaster site, the system would ask you three or four multiple-choice questions about the show. Only if you get them right will it let you in to buy tickets. It’s like a CAPTCHA, but instead of separating robots from humans, it separates true fans from scalpers and occasional enthusiasts.

Any Hannah Montana fan worth her salt would know about the basics like that Mylie is from Tennessee, but they would also be able to answer the hard questions. Like whatever is the Disney question equivalent of who pulled the Ace of Spades before a crash. (And if you understand the last sentence you just might be a fan of ______ )

But any solution like the prove-your-fandom to buy is only a stopgap method. The problem is larger than simplistic explanations of whiny tweens complaining about their inability to get whatever they want this time too, or greedy bastards trying to squeeze every last penny from the public. The issues leading to this problem are long-lasting (remember payola or Pearl Jam’s failed anti-Ticketmaster campaign?) and deeply integrated (Clear Channel’s ownership of radio stations AND concert venues; and JAM production’s overwhelming market power in Chicago). In our economic system, there are no clearly defined financial incentives for those with ownership (record companies, artists, venue owners, promoters, managers, etc) to focus on serving their fans instead of making money (see: Cubs baseball team selling tickets via both direct sales and through their scalping wing).

The system has failed. No economic analysis of supply-and-demand can explain the sense in tweens being unable to see an idol specifically marketed to them because they have been priced out of the market.