Churchill Downs To Partner With Ticketmaster For Online Exchange

Posted on: Mar 10, 2016

There’s an obvious economic reality about the Kentucky Derby and Kentucky Oaks–demand for tickets often exceeds supply. This is especially true in a year like 2014 and 2015 when dominant horses California Chrome and American Pharoah raised interest among the general public. When huge demand results in a sellout situation at the track there’s an obvious recourse–turn to the secondary market. Ticket ‘scalpers’ have existed around major sporting events for years but the Internet era has brought about an influx of online ticket brokers. And while sports teams and venues have always complained that such a system takes advantage of the fans (spoiler alert: it doesn’t) the reality is that they want to keep as much money in their pockets as possible. If they’re not getting a cut, they try to find a way to change that.

Churchill Downs is no different. Ticket scalping is technically illegal in Kentucky but the law has a loophole (surprise, surprise) that allows the track to sell excess Derby and Oaks tickets directly to ticket brokers. Apparently, that will no longer be the case as Chuchill Downs is partnering with Ticketmaster to create an online exchange marketplace where ticket holders can sell their ducats. Some people buy tickets and can’t go to the race, while others get wind of rising prices and want to unload their tickets at a profit.

The new scheme makes sure that Churchill gets a cut. Their gripe in the past was that ticket brokers would buy up blocks of Kentucky Derby tickets, driving the price up and then flood the market with unsold tickets right before the race day resulting in plummeting prices. At least this is their public gripe and not a very good one since this supply/demand formula drives most free economies. A better justification is a concern over counterfeit tickets though there is scant evidence that it’s a problem at the Kentucky Derby as it is at the Super Bowl and other events.

Part of the sales pitch for the new exchange site will be a guarantee of legitimacy–the tickets are heavily bar coded and only verified genuine tickets will be allowed for resale.