Last week, Major League Baseball renewed its partnership with StubHub, making the service the official secondary ticket marketplace of MLB. The New York Yankees are not very happy about this, and have decided to strike out on their own, creating a partnership with Ticketmaster.
As we've told you before, StubHub has been terrible for the Yankees' bottom line. With no price floor (this new agreement does have a negligible price floor of $6 including processing fees), in place to regulate ticket prices, StubHub users are free to sell Yankees tickets far below face value, and they have done so in droves. Now, one might think that the Yankees would see this situation as a lesson in supply and demand and go about making adjustments to their ticket prices. For instance, the team could stop selling tickets at an expensive flat price for every game, and institute dynamic prices that vary from game to game.
Not so! Instead, the Yankees have decided to tighten their grip on the market rather than adjust to it in their new deal with Ticketmaster. As the Wall Street Journal reports, the team will institute its own price floor through Ticketmaster, which fans will be directed to via Yankees.com when they want to resell tickets. Sellers will be told that they cannot sell their tickets for less than a certain dollar amount.
In all likelihood, this plan will not work out very well for the Yankees. For one, nothing can prevent ticket holders from selling their tickets on StubHub anyway, they will just be directed by the team to use Ticketmaster. Even if sellers do follow instructions and use Ticketmaster, the price floor is likely to alienate buyers and lead to a lot of fans passing on tickets all together. It's hard to imagine the Yankees current merry band of old guys being enough of an attraction to push fans to pay higher ticket prices.