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‘Bots’ That Siphon Off Tickets Frustrate Concert Promoters

May 26, 2013 by Leave a Comment

That enemy is the bot.

“Bots,” computer programs used by scalpers, are a hidden part of a miserable ritual that plays out online nearly every week in which tickets to hot shows seem to vanish instantly.

Long a mere nuisance to the live music industry, these cheap and widely available programs are now perhaps its most reviled foe, frustrating fans and feeding a multibillion-dollar secondary market for tickets.

According to Ticketmaster, bots have been used to buy more than 60 percent of the most desirable tickets for some shows; in a recent lawsuit, the company accused one group of scalpers of using bots to request up to 200,000 tickets a day.

Ticketmaster and its parent company, Live Nation Entertainment, have stepped up efforts to combat bots, in part to improve the ticket-buying experience for concertgoers, but also to burnish the company’s reputation with consumers. The result has been a game of cat and mouse between the company and the bots.

“As with hackers, you can solve it today, and they’re rewriting code tomorrow,” said Michael Rapino, Live Nation’s chief executive. “Thus the arms race.”

In late 2011, Ticketmaster hired John Carnahan, an expert on machine learning who fought online advertising frauds at Yahoo, to lead its anti-bot effort.

By monitoring the behavior of each visitor to Ticketmaster’s site, the company can determine the likelihood of a customer being human or a machine. For example, a human may click a series of buttons at a range of speeds and in different spots on a screen, but bots can give themselves away by rapidly clicking on precisely the same spot each time.

A screen on Mr. Carnahan’s desk in Los Angeles shows Ticketmaster’s incoming traffic, with a rainbow of colors at the bottom and splotches of red on top representing suspicious activity. On a recent Thursday afternoon, the screen showed that the red visitors were making 600 times more ticket requests than those the system identified as being most likely human.

Bots are not kicked off the system, but rather “speedbumped” — slowed down, sent to the end of the line or given some other means of interference, to allow a regular customer through.

“We’re not trying to stop anybody from buying tickets,” Mr. Carnahan said. “We’re just trying to make sure that a fan can buy the tickets.”

Ticketing bots are often inexpensive and programmed in countries beyond easy reach of American law enforcement. Rob Rachwald of the computer security company FireEye, which is not working with Ticketmaster, points out that one site — available in English and Russian — charges just $13.90 for the keys to 10,000 Captchas, those squiggly lines that test whether a potential customer is human.

In January, Ticketmaster replaced most of its old Captchas with newer and more sophisticated versions. The company is also introducing a system for mobile devices that aims to eliminate Captcha-style tests altogether.

Live Nation will not say how many of the 148 million tickets it sells each year are bought using bots, and in many cases it may not know. Few ever admit to using the programs; official groups like the National Association of Ticket Brokers, which represents many of the biggest resellers, condemn them and say they support anti-bot measures. But people at nearly every level of the concert business blame bots for wreaking all kinds of economic havoc.

“There are sold-out shows in reserved-seat houses in New York City where we will have 20 percent no-show, and that 20 percent will be down in the front of the house,” said Jim Glancy of The Bowery Presents, an independent concert promoter in New York. “It’s speculators who bought a bunch of seats and didn’t get the price they wanted.”

Concert promoters, artist managers and ticketing services say that bots are now an ever-present force, not only during the high-traffic moments when a big show officially goes on sale, but also at the odd moments when a promoter releases a few dozen extra seats with no announcement.

Darlene Schild, of Lincroft, N.J., may well have experienced the reach of bots firsthand recently when she tried to buy Justin Bieber tickets as an 11th birthday present for her daughter. Like any well-trained concertgoer, she fired up Ticketmaster’s iPhone app just as the tickets went on sale, but after 15 fruitless minutes she gave up.

“The first thing that crossed my mind was that some ticket-buying service bought them all,” Ms. Schild said. “Or someone could dial quicker than me. Some technology — something.”

Last month, Ticketmaster sued 21 people in federal court, accusing them of fraud, copyright infringement and other offenses in using bots to search for millions of tickets over the last two years.

The legal status of bots is unclear. They are banned in a handful of states, but those laws have proved largely ineffectual, and enforcement at the federal level has also been a disappointment to the concert business.

Three years ago, four men connected with a company called Wiseguy Tickets were indicted on conspiracy, wire fraud and other charges, for apparently using bots to get tickets to Bruce Springsteen, Hannah Montana and other concerts.

The case hinged on whether the men had committed actual crimes or had merely violated the terms of service on Ticketmaster’s site; in the end three of the men were sentenced only to probation and community service (one remained at large).

“They got a slap on the wrist,” Mr. Rapino said. “It wasn’t much of an actual deterrent.”

Not everyone is convinced that bots are the primary villain of the everyday concertgoer. The Fan Freedom Project, a nonprofit group financed by StubHub, has pushed for anti-bot laws around the country, and Jon Potter, its president, praised Ticketmaster for filing its lawsuit last month.

But he also criticized the industry practice of “holds,” in which sometimes large blocks of tickets are reserved for sponsors, fan club members and industry contacts, and never go on sale to the general public.

When it comes to the secondary ticket market, Live Nation has a complicated position. As much as it is trying to block bots, it also profits from the ticket resale market through TicketsNow — its own version of StubHub — as well as through deals with major sports groups, like the National Basketball Association. Mr. Rapino sees no contradiction in Live Nation’s stance.

“I have no problem if you bought a Justin Timberlake ticket and you decide to go sell that ticket to somebody,” he said. “We would first and foremost want to make sure that the first ticket sold, that the fan has a shot to buy that ticket.”

Article source: http://www.nytimes.com/2013/05/27/business/media/bots-that-siphon-off-tickets-frustrate-concert-promoters.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

DealBook: Fewer Barclays Employees Made More Than $1.5 Million in 2012

March 8, 2013 by Leave a Comment

A branch of Barclays in London.Andy Rain/European Pressphoto AgencyA branch of Barclays in London.

LONDON – Barclays said Friday that 428 employees earned more than £1 million, or $1.5 million, each last year, but the number was down from 2011 as the British bank has been under fire over several scandals.

Barclays said 45 fewer people earned more than £1 million in 2012 than year earlier. Rival HSBC said Monday that 204 members of its staff fell into that pay bracket. Barclays paid five bankers more than £5 million each last year, down from 17 in 2011, according to the bank’s annual report published Friday.

Last year was financially difficult for Barclays as it recorded a loss for 2012 and found itself embroiled in several investigations that have dented its reputation. At a time when banks are under pressure to curb pay after disappointing earnings, Barclays said it was cutting remuneration and changing the criteria for awarding bonuses. Staff members will be evaluated against a set of standards, including integrity, put together by the bank’s chief executive, Antony Jenkins.

At a recent meeting with investors, Mr. Jenkins, who took over as chief executive in August, also hinted that more job cuts could be in store for Barclays. Talking about his priority to reduce costs and use more computer programs and technology to do so, he said that the bank could be looking for a way to operate with as few as 100,000 staff members over the next decade or so, according to a person with direct knowledge of his comments, who declined to be identified because the comments were not made in public. Barclays currently employs about 140,000.

“We have been justifiably criticized for failures to engage effectively with and explain our decisions to shareholders and the wider public,” John Sunderland, chairman of the board remuneration committee, wrote in the latest annual report. “We must also ensure that we pay no more than necessary to achieve Barclays objectives, and that we eliminate undeserved remuneration.”

Barclays' chief, Antony Jenkins, recently hinted that more job cuts could be in store for the bank.Luke Macgregor/ReutersBarclays’ chief, Antony Jenkins, recently hinted that more job cuts could be in store for the bank.

Barclays started a wide-ranging cost reduction program that includes cutting 3,700 jobs and closing some business units and branches. The bank reported a net loss last month of £1 billion for last year, compared with a £3 billion profit for 2011, because of provisions to cover legal costs related to the rate-rigging scandal and other improper activities.

Barclays has also recently clawed back £300 million of deferred bonuses because of the bank’s involvement in the scandals that also led to the resignation of Robert E. Diamond Jr. as chief executive. Barclays was forced to compensate customers for selling some insurance products they did not need or ask for and was fined $450 million in June for its role in the manipulation of the London interbank offered rate, or Libor.

Barclays said it paid executive directors in total in 2012 less than half of what they received a year earlier. Mr. Jenkins bowed to public pressure and announced earlier that he would not take an annual bonus for 2012. His total remuneration was £2.6 million for last year, including £833,000 in salary and £1.5 million as part of a long-term incentive plan. Mr. Diamond earned £6.3 million in 2011, according to the report.

Article source: http://dealbook.nytimes.com/2013/03/08/fewer-barclays-employees-made-more-than-1-million/?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

I.H.T Special Report: Smart Cities: Raising the I.Q. of City Services

October 2, 2011 by Leave a Comment

The ability to manage a crisis better by predicting emergency needs and deploying resources accordingly is already a reality for Rio de Janeiro, which earlier this year set up an Intelligent Operations Center using computer programs that rely on algorithms developed by I.B.M. And more cities are expected to follow suit soon.

“We now have a hub for information on anything that has an impact on the city’s day-to-day life,” said Carlos Roberto Osorio, Rio’s secretary for conservation and public services. “With this system, the information is treated quickly and the response is much faster. So the city becomes more intelligent, it becomes more agile and at the end of the day it becomes a safer city for our citizens.”

Guruduth Banavar, vice president and chief technology officer of the global public sector unit at I.B.M., said computer algorithms helped to analyze complicated data that the human brain alone cannot sort through. “These algorithms, collectively called analytics, can use past historical and current data in a given situation to predict the most likely scenario that will develop and suggest the best way to react to the current event,” he said.

“Analytics is about using information to decide how to best react to current events and how to best plan for what is likely to happen in the future.”

Mr. Osorio said that Rio’s center had helped cut the city’s response time to emergencies by 30 percent, on average. “We have now become much more reliable in term of preventing events,” he said. “With this system we can mitigate the impact before it happens. This means the level of stress in the city and the level of risk to our citizens are greatly diminished.”

He said the cost of starting the center was 25 million real, or about $14 million.

Analytics can help cities move from uncertainty — or knowing events may occur but having no further knowledge to act on — to risk quantification, which in turn allows for the development of business continuity plans and other contingency planning, and action, said David McCloskey, a partner in Deloitte Analytics.

“The next step for analytics to help cities respond to a crisis is to build capabilities that provide effective risk mitigation,” Mr. McCloskey said. For example, using system modelling to develop programs that could read information from sensors to tell when electricity transmission networks are threatened by wildfires and then close off or reroute power, or using predictive analytics from sifting voluminous crime reports to improve police visibility in problem areas.

Deloitte has developed a smartphone application called Bamboo that harnesses analytics to aid in the effective functioning and continuance of operations after a crisis occurs. The program is mainly aimed at corporations, but it could also be used at the municipal level, Mr. McCloskey said.

Eric Wood, an analyst at Pike Research, a market research and consulting firm on clean energy technology, said “smart cities” are those that are able to shift from being just reactive to being proactive, based on the use of better information. Such cities use the data to make their operations more efficient but also to improve their responsiveness to emergencies and critical incidents.

Article source: http://www.nytimes.com/2011/09/30/business/global/raising-the-iq-of-city-services.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,