Commentary: Ticket Madness At The World Cup

Mikhael Dryacki came early. The 25-year-old French football fan woke up at 5 a.m. in Rouen, took a two-hour train ride to Paris, and spent another 45 minutes in the Metro--all to arrive eight hours in advance of the kickoff for the Nigeria-Bulgaria World Cup match at the Parc des Princes stadium. With the game sold out, he tried the scalpers, but they were asking up to $800 a ticket, 33 times the lowest official price of $24. "It's ridiculous," says a disappointed Dryacki.

He's right. France's monthlong football fiesta has turned into a fiasco, in large part because organizers relied more on old-fashioned dirigisme than market efficiency. They subsidized tickets for low-income fans and erected protectionist walls to favor French residents. The result was an unnecessarily vicious black market. If tickets had been sold in a more transparent, evenhanded fashion, even some of the regrettable violence in French cities that housed matches might have been avoided.

CRONYISM. Some tension was inevitable. Eight European nations with easy car access to France qualified for the tournament. "We estimated demand for 25 million tickets and had a little more than 2.5 million [seats] to sell," laments Jacques Lambert, the organizing committee's general director.

But poor management turned a difficult situation into an intolerable one. Instead of holding most of the games in the brand-new 80,000-seat Stade de France in Paris, the organizers scheduled many matches in smaller towns with smaller stadiums. And instead of setting prices to minimize the gap between supply and demand, the organizers only sold tickets in batches to all first-round games at a single site and for as little as $24 a seat. "We want to make the World Cup affordable to everyone," says Michel Platini, president of the French Organizing Committee for World Cup 1998.

That goal would have been better served by individual game tickets and higher prices. "I would save up to pay $150 for one ticket, but not $800," says Richard Gallagher, a ticketless engineer who came to Paris from the working-class British town of Middlesbrough in hopes of a seat at the Nigeria-Bulgaria game. He ended up watching the match on TV. "If the organizers had increased supply by putting on more football games and restricted demand by raising prices, it would have been a step towards a solution," says economist Fred Pallada of ING Bank in the Netherlands.

Protectionism increased the problem. The French reserved a quarter of the tickets for their own residents. "This is a French World Cup, after all," Platini argues. But that intensified the anger of foreign fans who couldn't see their own teams play.

Global football's cronyism fueled further frustration. While the French organizing committee was responsible for selling tickets to the general public, the Federation Internationale de Football Assn. (FIFA) received 24% of the tickets to allocate to national football associations. Critics say many of these seats ended up on the black market. "FIFA really doesn't scrutinize or monitor its business partners," says Alan Tomlinson, co-author of the recently published book FIFA and the Contest for World Football: Who Rules the People's Game.

Unfortunately, football's poor management doesn't look likely to improve. In a June 8 election for the FIFA presidency held one day before the World Cup opened, Joseph Sepp Blatter, long FIFA's secretary general, beat reform candidate Lennart Johansson. Since then, allegations of vote buying and other irregularities have surfaced.

Amazingly, football mandarins shrug off any hints of mismanagement, confident that their product will sell no matter what. "The only thing people will remember is the quality of the games on the field," argues Platini.

But no sport can risk alienating its fans. "At the end of the day, people are going to become highly suspicious unless they get value for money," says Gordon Wallis, who runs Soccer Nostalgia, an English association specializing in football memorabilia. Unless football and the World Cup become more transparent and accountable, angry fans may penalize football with a giant Yellow Card--a warning for misconduct on the field.

    Before it's here, it's on the Bloomberg Terminal.