Monday, June 19, 2006


An Increase is still an Increase...

One of the more annoying things creeping into the world the past few years has been the increase in service charges. Remember when the bank used to be happy that you would put money into their hands, allowing them to 'create' wealth to loan to other customers? More and more, the banks charge you for the pleasure of depositing your money and using the account so that they can turn around and make even more profit somebody else.

The sports world, too, has seen it's fair share of service charges. Go buy a ticket at (shouldn't they be subject to anti-monopoly laws) or some similar service, and you are bombarded with fees. On top of the usual rip off ticketmaster fee, they now charge a 'convenience' fee. Umm, wasn't using your service in the first place a convenience? Why am I paying twice for the same ticket? Shouldn't the teams be paying ticketmaster for their services in distributing tickets? Well, they managed to make the fans pay for it, in a sneaky way.

Now, the newest fad in service charges, one which I've seen here in Vancouver, is the 'Facilities Fee'. That's right, they charge you an extra fee just for the facility. Aren't teams supposed to pay their own expenses from the revenues they generate? Not when they can make the fans pay for it.

Case in point: Anaheim Mighty Ducks breaking their promise not to increase ticket prices.


According to Tim Ryan, chief executive of Anaheim Arena Management, a "facilities" fee will be attached to every ticket purchased for an event at the Pond, including Ducks games.

For every ticket to a Ducks game priced above $25, a $3 facility fee will be required, team officials confirmed. Tickets costing $25 or less will be assessed a $1.50 fee.

"It's a fee that's pretty much standard in our business," said Ryan, who is also the Ducks' chief operating officer. The team and the arena's management company are owned by Henry and Susan Samueli.

A look at other facilities supports Ryan's contention. In 2001, officials with the Pepsi Center in Denver instituted a $1 surcharge for all tickets purchased except for season-ticket holders. Tickets priced $7.50 or below had a 50-cent surcharge. Another example is Nationwide Arena, the home of the Columbus Blue Jackets, where a $1 facility fee is attached to every ticket.

The Ducks, Ryan said, have not reneged on a promise made when the lockout ended last summer to not raise season-ticket prices this coming season. They also had rolled back prices this past season by as much as $9 a seat. Other teams, such as Ottawa, made similar promises or reduced prices.


They didn't reneg on their promise, eh? Then why are ticket prices increasing? That's like saying Britney Spears' breasts aren't fake. Technically, they are REAL silicon.

Look, if you want to increase prices, then do it. Ticket prices are a supply/demand function and the teams objective is always to maximize revenues. Just don't hide behind BS and try to mask the fact that you are, in fact, raising prices. When I buy a ticket to a game, I'd like the ticket price listed to reflect the amount, or close to the amount, I expect to pay. It's silly to see a $30 ticket suddenly turn astronomical after adding a $3 convenience charge, a $5 ticketmaster fee, whatever local and federal taxes, and now a facilities fee.

The one great thing about this new facilities fee is that teams can directly put the revenue to the arena and just skip the team altogether. Teams have always hidden revenue in the arenas to make the team appear worse than they were (even though GM Place wouldn't make a cent unless the Canucks were there), but now they can plunk this ticket increase right to the arena without any funny bookkeeping. Mmm hmm.

When you see an index of average ticket prices, I bet they don't take into account the numerous service charges various teams charge.

One other thing, it seems Brian Burke hasn't changed his spots. Now he's whining that the Ducks 'lost' $15mil last year. Riiight. Why is it that sports teams love to brag about how much money they lose. You don't see that too much in other industries. Just imagine Wal-Mart coming out and gleefully whining about losing $1billion in the upcoming year. You can imagine the damage it would do to their company. Sports teams? They wear it like a badge of honour.

Brian Burke seems to have this problem of losing money everywhere he goes. Perhaps he ought to go back to business school or perhaps develop a business plan whereby his teams don't spend more money than they make *eyeroll**scoff*

Question: Is this some cleaver ruse for Burkie, the Ducklings ownership (and other teams) to increase revenue without the money contributing to 'the pot' that is distribted to the players at year end?

You know something like "we lost a wopping $Xmillion. The extra $Ymillion was a facility fee. We the team never saw that!" Even if it ended up in the owner's pocket.
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