Monday, June 09, 2008

On Tournament Pay Seating

From CNN, a "sad" story about how expensive it is to sit court side (around $35,000) for the NBA finals these days. However, notice the following about the other seats:
"Right now, we're getting $450 to $475 for the worst row in the balcony,'' said John Higgins of Higs Cityside Tickets, a ticket broker in Boston. "My partner was in the business in the '80s and he says it cost close to $500 to get in anywhere in the building back then. Of course, that was the old Garden, so you might have been paying $500 to sit behind a pole or some AC vent.''
Interesting, seat price inequality has been on the rise throughout the NBA's recent history, as the front row seats explode in price. However, for the rest of the seats, nominal prices seem to be the same, certainly (assuming source is accurate) a decrease in the real price. Additionally, the quality of the seat has been improved. Not to mention the quality of those who are watching from home, on a digital HD big screen TV that costs in the hundreds or low thousands.

Let's string together the explanation. The rise of good quality substitutes with ever falling prices (TV's) have driven demand down for the mediocre-poor seats like television have competed down prices there. At the same time, this viable close substitute to stay at home has increased the value of the court side seats for those who wish to actually go to the game. Not to mention, the greater coverage of the sport has increased the possibility of being seen on TV. The result: a small difference in viewing ability produces dramatic differences in seat prices.

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