Vulture capitalism is thriving in the market for 'Hamilton' tickets

"Hamilton" has given my kids an important civics lesson, but not the kind that President Obama referred to during Sunday's Tony Awards. The process of trying to get a ticket to the hit Broadway musical has given us a taste of what it's like to feel the system is rigged. At 11:10 p.m. (ET) on Sunday night, the box office released a four-month bloc of tickets to the general public. Three of us sat logged into Ticketmaster, fingers poised to buy standard-priced seats at separate shows. We chose, the system froze, and we ended up with nothing other than the option to buy the same tickets from resellers at five times the price.

It's a pattern that's become all too familiar to concert goers and regulators who are outraged at the vulture capitalism that's thriving on the secondary market. Through ticket bots, cheap labor, and an inside track with artists themselves, resellers have gained such an edge over consumers that it seems practically impossible get a fair price.

Most of the venom is directed at brokers who use software to muscle ahead of fans, scoop up tickets, and then resell them for several times the face value. It's a business model that's drawn the ire of regulators worldwide, from New York Attorney General Eric T. Schneiderman to members of the U.K. Parliament.

But the current penalties amount to little more than a highway toll for an industry that rings up $5 billion in US sales each year, according to Northcoast Research. When Schneiderman recently announced a $2.7 million fine against six brokers that used bots, I was immediately reminded of China's anti-smoking efforts in the 1990s. Fines were so low at Beijing's airport that it wasn't unusual to see smokers keep lit cigarettes dangling in their mouths as they fished for coins to pay off inspectors.

For most of us, the problem is less about bots than getting access at a fair price. In this respect, "Hamilton" creator Lin-Manuel Miranda is a complicated hero. While he's spoken out against ticket scalpers and made a genuine effort to extend access beyond the wealthy with lotteries and special high school performances, he also just raised the price of premium tickets to $849. Even third-party brokers seemed to balk at that number, leaving some of those tickets unsold on Sunday night.

For motivated fans, that leaves few options beyond entering the daily lottery or camping overnight for a shot at cancelled tickets. My 15-year-old son and I decided to try that option last week. I arrived at 2 a.m. on a Wednesday morning to find dozens already camped out. After the live lottery and matinee, the number had dwindled to fewer than 20. At 8 p.m., two well-dressed couples showed up to take over for two men they'd hired to stand in line, and immediately entered the theater.

When several people in line began yelling "that's not fair," a theater staffer came out to calm the crowd. "Can I just have a standing room ticket?" sobbed a 13-year-old girl behind us, who'd come in from Long Island. He pulled her and her father aside, promising to give them a ticket to any performance in July. When I dared to suggest that wasn't exactly fair, either, he brushed me away. At this, my son concluded we're destined to remain at the back of the queue. His hope now is for "Hamilton," the movie.