US FTC urged to ban ticket drip pricing
A group of New York academics have urged the US consumer watchdog, the Federal Trade Commission (FTC), to ban so-called ‘drip pricing’, where additional charges are added at the end of the booking process for tickets and reservations.
In a petition to the FTC, Brian Canfield, Jack Lienke, Matthew Peterson and Max Sarinsky of the Institute for Policy Integrity at New York University School of Law, argue that drip pricing, which is “pervasive for concerts and other events that impose ticketing charges, as well as hotel and vacation rentals that charge cleaning or resort fees”, serves no legitimate business purpose and harms consumers, and so should be outlawed by the FTC.
Drip pricing is already banned in much of the world, with local FTC equivalents in the UK, the Netherlands, Canada, Russia, France and elsewhere having taken action to ensure the price consumers will pay for a concert ticket is displayed upfront.
In an article for the New York Times, Sarinsky (pictured), a senior attorney at the institute, says drip pricing is also unfair to businesses that don’t institute the practice. “Unless all sellers are required to disclose their full prices upfront, companies that opt for transparency risk losing market share to those that practice deception,” he writes.
“A ban on hidden fees and drip pricing would represent a huge win for consumers and improve the functioning of markets where the practice has taken root”
According to Ticket News, most online ticket sellers (both primary ticket agencies and secondary marketplaces) already offer ‘all-in’ pricing, with AXS and Vivid Seats the only platforms while hide extra charges “until [the] last step”.
As Sarinsky notes, drip pricing is already illegal in the airline industry in the US, while San Francisco and Washington have sued hospitality companies for ‘deceptively’ advertising travel packages and holiday rooms at an unattainable price.
“Under our proposal, all sellers would be required to disclose the full price of a product or service upfront, with any mandatory surcharges included as part of that total price,” he continues.
“A ban on hidden fees and drip pricing would represent a huge win for consumers and improve the functioning of markets where the practice has taken root. For the commission’s new majority, which is eager to protect consumers, such a regulation should be a high priority.”
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