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Thursday, March 15, 2007

Service Charge

When you buy, say an airline ticket to Texas, if you call and get it they charge you extra. They want you to buy it online, even print your boarding pass online so they don't have to pay someone to serve you. If you want someone, they charge you extra.

When you buy, say an Astros ticket, if you go to the box office and buy it from a human, no service charge, but if you buy it at home on a computer and print at home on your printer, involving no humans, they charge you a service fee.

Why wouldn't someone like, say the Houston Astros baseball club, take ticket opperations in house, cut the online service charges, and make buying tickets to their events easier and cheaper for their customers?


cjh said...

Because they're the best organization ever?

japruf said...


Seriously, operations like sports teams and stadiums get all mixed up with unions and minority interest groups. The Astros have a deal to provide a certain amount of business to minority owned companies, low bidders, etc. None of these arrangements favor efficiency. Ultimately, one would hope we wouldn't need service fees to encourage online purachases, but it is at least understandable as businesses try to incentivize less tech savvy people into the wonderful world of not having to talk to someone.

Bubba said...

I don't buy the unions. I would guess there is not one union (I don't count the players union) employee for the Astros. I doubt their concession workers are unionized, as not even the Mets concession workers are in a union.

The stadium had minority contracts tied to it because of use of public money.

I'm talking about ticketmaster. They have to get their cut. My question, why don't the Astros just not use ticketmaster, then their fans would be saved the ticketmaster fees.

Timmie Smith said...

If the Astros didn't use Ticketmaster then they would have to handle their own ticket sales. That costs them a lot of money.

* Salary of the guy the programs the site, or the cost to buy someone else's package.

* Cost of the machine to run the site. I'll bet that astros.com is hosted on a system with other MLB clubs, so no piggybacking there.

* Salary of the nerd to manage the system running the site. Machines break and crash.

All in all using ticketmaster is a no brainer for the club. Yes, their fans get stuck with a fee, but that isn't something that really hits their bottom line, it's an externality to them. Very few people will refuse to go to a game because they don't want to pay the service fee, so they don't see a drop in crowd sizes that would get them to do something about the fees.

cjh said...

Um, how about calling the actual ticket folks at the ballpark? I did yesterday and ended up getting better seats than were available online and saved a $15 charge. It seemed to me that they were actually trying to encourage fans to speak to real human beings.

Bubba said...

We send Granddaddy to the ballpark to get tickets, sans service charge.

Tim Smith: I understand an intial sunk cost getting the system up and running, but once that is done, instead of paying the lady to answer the phone, pay the lady to run the computer.

I also use stubhub.com to get the tickets I want because sometimes the best seats aren't that great. Generally you get good seats there not much over face value (we paid $2 over face value) but you get to sit where you want. There are service charges though, but they fedex the tickets to you. I've used them twice here in NY and they are worth it to get some better seats.