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Wednesday, June 6, 2012
Executives: Yanks may drop StubHub

By Andrew Marchand
ESPNNewYork.com

The official relationship between the New York Yankees and StubHub may come to an end at the conclusion of this season because the team feels StubHub's pricing system artificially deflates the value of tickets, according to high-ranking Yankees executives.

The Yankees, along with other clubs, feel StubHub's system is unfair to season ticket holders, who pay top dollar only to see similar tickets being sold for a much cheaper price, the officials said.

Currently, the Yankees are locked into an overall contract between Major League Baseball and StubHub. The five-year agreement is in its final season.

Major League Baseball is negotiating with secondary ticket agencies, including TicketMaster, which is used by the NFL.

A Yankees official said the team can opt out of any new league agreement, if it chooses.

StubHub makes its money on a combination of fees. While it receives as much as 25 percent of the cost of a resold ticket, it also receives a minimum $5 fee on all sales. The fee, StubHub spokesman Glenn Lehrman said, is shared with Major League Baseball.

The Yankees official said professional ticket brokers treat the tickets as a commodity and "short" them. The brokers put up a ticket for sale, one executive said, before they own it, and then buy a ticket at a lower price to turn a profit. The brokers then pass on the ticket to the original buyer.

"We don't allow speculative selling on baseball," Lehrman said.

Lehrman said if StubHub discovered this, the company would put a stop to it.

As an example, the Yankees officials said that prior to last year, there were 250,000 tickets for sale on StubHub before the Yankees had even printed the tickets.

"We certainly believe in an open market," Lehrman said.

Lehrman didn't dispute that tickets could be listed before they are printed. However, he added that the seller must let the buyer know when they expect to have the tickets in-hand.

A fan looking to go to a single game can score a cheap seat by going online to buy tickets for less than $10 on StubHub.

"We feel our pricing is fan friendly," Lehrman said. "(The Yankees) have been one of our best partners. We hope to continue the relationship."

For the fan who attends a single game, the system may work. But season ticket holders are not recouping value on the secondary market, a team official said.

If StubHub is not officially involved with the Yankees after this season, the agency would still be able to sell tickets, but it wouldn't be integrated with the Yankees. So it would be more difficult to buy tickets through StubHub than it would be through the new secondary market broker.

The Yankees officials said the Los Angeles Angels, Los Angeles Dodgers, Boston Red Sox and Chicago Cubs, among others teams, have joined the Yankees in wanting a new system.

The officials said other teams feel a change will create a more accurate secondary market, which would protect their season ticket holders.