Digital Economy Bill - Committee (4th Day) (Continued)

Part of the debate – in the House of Lords at 9:45 pm on 8th February 2017.

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Photo of Lord Moynihan Lord Moynihan Conservative 9:45 pm, 8th February 2017

My Lords, I support the seven amendments in this group spoken to by the noble Lord, Lord Stevenson. I echo that it is particularly appropriate in many ways, albeit very sad, that we debate the often malicious and pernicious use of bots on the sad day of the funeral of my very close friend Baroness Rachael Heyhoe Flint. One afternoon, she was purposefully striding down the Corridor outside the Peers’ Guest Room, and said “I need you”. I jumped to attention and we headed off to the Department for Business, Innovation and Skills. I was totally unaware of why I was accompanying her on that occasion, or indeed the matter proposed for discussion. Rachael launched into a thinly veiled, front-foot attack on those in and around the secondary market, who fleece consumers to no benefit to cricketers, musicians, sportsmen and sportswomen, who are the ones who entertain them. Through her hard work and persuasive skills, I was galvanised into action. I thank the Government for the progress that we made in the Consumer Rights Bill at the time, as well as the Opposition and noble Lords from all sides of the House.

That was just a first yet important step. Today is the second opportunity to make further progress. I was very sad not to be at Rachael’s funeral today to pay my close personal, political and sporting respects, but she would have been the first to admonish me. She would have said, “Why on earth are you not down in Westminster putting on your pads, your gloves and picking up your bat, and going into the centre of the parliamentary wicket to hit those bots for six?” I will do my best, captain. I will do my best. In paying tribute to her, because she was absolutely instrumental in the work that we undertook during the passage of that Bill, I must also pay tribute to Nigel Adams, Member of Parliament in another place, who has taken this to his heart and has done so much good work.

The whole issue of bots goes right to the heart of the disappointment of thousands of music and sporting fans who have on occasion faced the reality of having their credit card ready in their hand with minutes to go before the sale of tickets for a particular gig or match but no sooner do they gone on sale than they sell out. Minutes later, tickets can be spotted on reselling websites. The new, hidden threat that is snatching tickets from under the noses of genuine fans is ticketing bots.

Music and sports fans have always battled against touts buying up tickets to make a quick buck by selling them on again at inflated prices. But now touts have a new cyberweapon that allows them to step up their game. These ticketing bots are software; they buy up huge numbers of tickets for events as soon as they go on sale. Buyers then use the secondary websites to sell them on. Reg Walker, who has done an enormous amount of good work on this at the O2, stated:

“They then harvest tickets at high speed and that effectively blocks out genuine fans from being able to purchase tickets at face value. These tickets are then immediately resold on secondary ticketing platforms”.

What then happens is that those who are sitting in their garages using bots programmed with all this information press the button immediately and get their 200 tickets, and sell them on to one of the four secondary platforms where nearly 80% to 90% of resale now takes place. In so doing, they do not necessarily always get all the tickets they want. Their preferred status and good relationship with the platform is critical to their next sale. So, if necessary, they will have the income on a very high-price ticket with a high margin to go out and counterfeit tickets to make up the gap between those they have committed to supply and the actual number that they have. That is why the wholesale harvesting of tickets by touts not only incentivises these individuals to create relationships with the main providers of the secondary market tickets, the providers even develop power-seller programmes to encourage the delivery of mass tickets.

This is all at the same time that you are trying to type in your name in order to get a couple of tickets, as the true fan of a music show at the O2 or a sporting event. The reality is that you have no chance. We have all tried it; I have tried it on many occasions and cannot believe that they have sold out before I have got down my name, address, credit card number and so on. It is no surprise, though, when bots are available purely for the benefit of the profit of the individual. No artists, no sportsmen and no fans benefit. That mark- up goes straight into the pocket of the individual who has got the ticket and the secondary sales platforms that provide those tickets at inflated prices to consumers.

As a result of that, not surprisingly, the number of counterfeit tickets significantly increases. It was interesting that Reg Walker, who works on security at the O2 and has to deal with people with counterfeit tickets and turn them away, confirmed and attested that in the period 2013-14, approximately 1,100 invalid or counterfeit tickets were presented for entry at the O2, where the victims alleged that they had been purchased from just one of these platforms, Seatwave. In one instance, a couple who had purchased invalid tickets for entry at the O2 returned to the Seatwave office and were given two further tickets, which were also invalid.

Although in the main the victims appear to have secured refunds or charge-backs on their credit cards, there was no compensation for the air fares, travel expenses or accommodation—and, above all, no compensation for missing the experience. Yet these bots continue to cause a huge problem for the true fan. It is vital that the Government—with, I hope, the support of the whole House—recognise that it is time now to follow the example that has been made, not least in the United States recently, where in New York and a range of other states legislation has been implemented to tackle the issue of bots, since we had the earlier debates on the consumer protection Bill.

The National Fraud Authority report, which we alluded to during our debates on that Bill, highlighted that this is not a small problem and a minor issue. Some 2.3 million people fall victim each year to online ticket fraud; it was estimated that that resulted in losses of £1.5 billion and, as I have mentioned, considerable personal stress.

The first part of this group of amendments focuses on that. I do not think it is appropriate to go into all the details that we would need in order to persuade the Minister, because I hope that he will follow the lead he showed yesterday when convening a meeting, where I had an opportunity to learn a great deal of important background information for the debate today. I saw that the Minister was really keen to listen and take note, and I hope that if we can persuade him to consider some of the issues set out in the following amendments, we will not have to stay here longer this evening.

Suffice it to say that the steps that are now enshrined in the Consumer Rights Act are insufficient. I do not say that from my own analysis. It was interesting that the magazine Which? undertook a thorough analysis of the effectiveness of what we did in this House and another place—the Consumer Rights Act 2015. On looking at the five top resale ticketing websites offering tickets for artists such as One Direction and U2 and sporting events such as the Rugby World Cup and Six Nations, it came to the conclusion that key booking information was missing in a number of instances—clear breaches of the Consumer Rights Act. This requires the key details to be given at the time of resale, including the face value of the ticket, seating area, and any restrictions that apply.

Richard Lloyd, the executive director of Which?, said that it was unacceptable that these ticket resale sites were getting away with not providing fans with key ticket information, leaving them unsure whether their ticket was a good deal, where they would be seated or even whether they would get in. Its research on Get Me In, Seatwave, Stubhub, Viagogo and World Ticket Shop found:

“Seatwave, Viagogo and World Ticket Shop failing to display the original face value of tickets. … seats to a Six Nations Scotland vs England game, sold through Seatwave, where the face value was given as £0.00. Viagogo was selling tickets to a One Direction concert last month where the original cost was merely stated as between £44.55 and £72.60. ... All of the companies were found to be re-selling tickets with no clear information as to where fans would be sitting”.

The one thing that would really help consumers know whether their ticket was valid would be a reference number on the ticket. After all, all tickets are unique. They have a different seat number and row number, and in virtually every case they have to be reprinted every day for matinee or evening performances in the theatre. It is not technically difficult simply to add a reference number to the ticket, which would allow the owner of the ticket to check with Twickenham or whoever it might be that the ticket is valid. It is a very small price to pay in order to counter the regrettable inadequacy of not having a comprehensive answer to the problems that we had hoped we were getting close to in the Bill last year.

This is one further step on a number of issues that I would genuinely ask the Government to look at. We need to strengthen the requirements for ticket sellers on to the platform. Yesterday my noble friend made the good point in closing that we do not want to have numbers on each and every ticket because some are sold in blocks while others might be for a small pantomime in a Bury theatre. The truth is that the Committee is not asking for that. We are asking that where an event organiser has provided a number on the ticket in the first place, the secondary market should be required to put that number on the advertising on its website so that it can be checked. I am grateful to the Minister for highlighting that point and I hope that my response will allow him to think yet further about how we can put in place just a small number of additional measures to strengthen the legislation in order to protect consumers, to absolutely get rid of bots and, from a personal point of view, to pay respect to my lamented and absent noble friend this evening, Rachael Heyhoe Flint.