Nicholas Cù is unsure whether to buy a ticket to see his beloved San Francisco 49ers play in the 2024on Sunday.
The lifelong fan has attended every 49ers playoff game over the past two years, but…Are in history, selling for an average of more than $12,000 on some resale sites in the past week.
With just two days to go until the big game, Cù wasn’t sure Friday if he would ever be able to attend a Super Bowl in person.
Cù asked a Facebook group of other 49ers faithful in January for “tips on the best and most affordable way to buy Super Bowl tickets.” The more than a hundred responses that poured in were emblematic of a well-known truth about the big game: It’s nearly impossible for an average fan — or even a wealthy fan — to make it to the Super Bowl.
Face value tickets, which are initially expensive, are rarely made available to the general public.
This was not the case in the past. But in recent years, ticket industry experts say, a series of business decisions by the NFL to distribute the coveted tickets have sent prices skyrocketing — far beyond the reach of most fans.
Impossible to afford, by design
“It’s just a complete mystery how you can even attend without remortgaging your house to pay for tickets,” Cù said.
That’s by design, according to Stephen Shapiro, associate professor of the University of South Carolina’s Department of Sports and Entertainment Management.
Some tickets are distributed to NFL teams, or sold at face value to players, coaches and others involved in the sport. Others are given to the league’s corporate sponsors and partners, such as CBS’s parent company, Paramount Global. (CBS will broadcast the game; it will also air on Nickelodeon and stream on Paramount+.) Then another batch of tickets will go to an events company founded by the NFL in 2010 called On Location Experiences.
“There is typically no general public option,” Shapiro said. “Teams will have tickets that they can sell to season ticket holders, but even that is a lottery system. And between sponsors, hospitality and other business partnerships, tickets are pretty much discussed.”
Costs further increasing is the size of the location this year. Attendance atis expected to be about 60,000 – one of the smallest in Super Bowl history. By comparison, nearly 68,000 fans attended the 2023 game in Glendale, Arizona, and about 70,000 the year before in Inglewood, California.
Face value tickets usually cost anywhere from $950 for a nosebleed seat to $9,500 to stand just behind the teams, facing the 50-yard line. That’s a fraction of what Super Bowl tickets sell for online.
Other buyers have to make do with secondary market sites like StubHub or SeatGeek; ticket brokers – people who buy and sell tickets for a living; or high-end packages from the NFL’s “Official Hospitality Partner”, on-site.
Packages on On Location’s website this week ranged from about $7,000 to more than $60,000.
The NFL did not respond to emailed questions. A spokesperson for On Location declined to comment.
The NFL investment vehicle with a stake in the game
Nearly a dozen ticket brokers, sports management experts, academics and attorneys contacted by CBS News said the current structure makes it challenging for fans to gain access — and drives up costs.
“How does a $4,500 ticket become a $14,000 ticket?” asked one frustrated ticket broker, who agreed to speak to CBS News on an anonymous basis because he still does business with the league.
“It’s greed, just greed,” he said.
He and others pointed to On Location, which according to ticket brokers and other sources familiar with doing business with the NFL is allocated at least 11,000 tickets annually, as the culprit behind these astronomical prices.
Before On Location became a factor, ticket brokers sometimes sold Super Bowl seats for just a few hundred dollars above face value, and some arranged flights and hotels for fans.
“I made $50 or $100 more than face ticket value in many cases, but I was happy,” another ticket broker told CBS News.
NFL executives started an equity fund called 32 Equity in 2013 to invest in companies and deals on behalf of the teams, according to PitchBook, which tracks venture capital investments. Forbes’ 24th annual NFL Team Valuations reported that the company’s investments have brought the average net worth of each of the 32 NFL teams to $3.48 billion, according to Global Corporate Venturing. Because it is a private fund, 32 Equity is not required to make its financials public.
32 Equity has typically invested in companies that work with the league, including the NFL’s data provider Genius Sports, retired NFL star Tom Brady’s TB12 brand, athlete recovery equipment company Hyperice and software companies Appetize, Skillz and Strivr, Front reported Office Sports. .
According to PitchBook, it invested in and acquired On Location in 2015. On Location sells its tickets as part of packages that can cost tens of thousands of dollars and include perks such as unlimited food and drinks during the game, hotel accommodations, live pre-game entertainment and what the company describes as “bucket list experiences.” Hotel rooms and other Super Bowl-related amenities are booked months in advance, with the company setting high prices as a test to see what the market can bear, multiple sources familiar with the pricing strategy told CBS News.
One leading broker defended On Location’s prices.
“They’re trying to price a product within fair market value,” said Ken Solky, president of LasVegasTickets.com and former president of the National Association of Ticket Brokers. “It’s their party and their tickets.”
Vicki Morwitz, a business professor at Columbia University, noted that ticket prices through resellers and brokers fell in the days leading up to the Super Bowl. She said these waves reflect the dynamic pricing model most ticket sellers use, where prices go up and down based on demand. It’s a model that isn’t always popular with customers, she said, pointing to complaints when high demand leads to high prices in other sectors.
“Uber and Lyft let supply and demand decide everything about how a price is determined, but in the eyes of the consumer, that economic reality of supply and demand does not always match the perception of fairness,” Morwitz said.
Shapiro, the sports marketing professor, said the guaranteed supply of tickets to sell, combined with blocks of hotel rooms and other amenities, “creates a competitive advantage for On Location,” which is now owned by the Endeavor Group – a multibillion-dollar global organization. sports and entertainment company in which NFL owners have a small minority stake.
According to the Hollywood Reporter, Endeavor Group Holdings, Inc. acquired On Location in January 2020 in a $660 million deal. The NFL’s stock fund retained a 13.5% stake in the company, according to an SEC filing.
Endeavor CEO Ariel Emanuel said in a statement at the time that the company would “advance the way consumers and brands think about experiences that money can’t buy.”
In 2022, the NFL’s investment arm bought back its shares in On Location. Executives exercised an option to recapture nearly 40% of the company’s equity, marketing Super Bowl LVI as “the largest on-site hospitality event of all time,” an annual investor pamphlet said in an SEC filing .
Two months later, On Location became a wholly owned subsidiary of the talent agency, which converted the NFL owners’ stake in On Location into a 1.5% ownership stake in Endeavor. The agency reported revenue of $1.344 billion in the final quarter of 2023.
Pockets full of cash and secret deals on the secondary market
The NFL’s control of the Super Bowl ticket market has implications for the secondary ticket market.
The fact that players, coaches and other personnel receive and sell tickets is something of an open secret, according to agents who spoke to CBS News.
A ticket broker called a CBS News reporter while driving through New York City with $85,000 cash in his car, saying he wanted to buy Super Bowl tickets from an NFL employee. CBS News agreed to anonymity so the ticket broker could provide details about how the broker system works.
Brokers said they often buy tickets from people who received them at face value and chose to sell them for a profit: players, coaches, event sponsors, agents or their clients.
Many of these deals are done in cash, and it’s “not unusual to take a million dollars in cash” to Super Bowl city to buy tickets, the broker said.
The NFL began cracking down on these sales as its own grip on ticket sales grew. Every year, employees are informed that they are prohibited from selling their tickets.
“Coaches are terrified,” said one ticket broker – and they are selling less, some brokers said.
This change has also resulted in prices rising, brokers said.
“Let’s just say that inevitably the tickets will move, the tickets will go a certain way. And it’s inevitable that some of them will end up in the hands of reputable brokers like LasVegasTickets.com,” Solky said.
Shapiro said the image of NFL personnel making money from the game is inconsistent with the NFL’s fan-friendly marketing.
“From a public opinion perspective, I don’t think it would look good for the league if individuals associated with the league bought the tickets at face value and simply resold them to make an obscene profit,” Shapiro said.
Even with the “obscene” formatting, Nicholas Cù said he still thought about pulling the trigger.
“I’m in a position in life where I could potentially afford to buy these tickets given how much it means. But it’s just so high for three hours of entertainment,” Cù said.
“It’s only a small percentage of people who have the resources and access,” Shapiro said. “We’re talking about the one percent that gets to go.”