HBO looks at rising price of sports tix and PSLs
HBO's "Real Sports" Tuesday looks at the rising price of tickets and PSLs. Here is an exchange between Bryant Gumbel and sports economist Mark Rosentraub:
ROSENTRAUB: The perfect storm that's been created with the deal that the sports leagues made, basically, with StubHub. You know, for a long time owners argued that they were producing more value. And they knew scalping was going on. And that people were selling the tickets for higher prices than they were charging. What StubHub did, when they went into business with them, is it gave them the data points. They now know what people are willing to pay. So what's happening now is that the prices are drifting up to what the market's willing to bear. The team owners are in business. They know what the value of their product is.
GUMBEL: So the guy who's been getting his football ticket for 75 bucks; his baseball ticket for 50 bucks; that was a bargain?
ROSENTRAUB: It's far less than the market would bear. Flip it around for a second. Let's suppose you're the owner of the Yankees or the owner of the Giants or the Jets. You're saying, Look, I spend a couple hundred million dollars a year to produce this product. I'm selling you a ticket at this price. You're turning it around and selling it for a higher price. You didn't take any of the risks of making the investment. So the teams now say, We're going to price it at the real value. "
GUMBEL: Would it be an oversimplification to suggest that the sports fans love of the game has made this bed and now they have to sleep in it?
ROSENTRAUB: Oh, absolutely. My values, probably your values, a lot of people watching tonight will say, Gee, I think sports is over valued. I would agree with that. But I'm not America. This is what America is willing to pay. If America is willing to pay it, so be it.