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Brokers snatch joy from Hannah Montana fans

  • Story Highlights
  • Online ticket brokers snatched up thousands of Hannah Montana concert tickets
  • Fans must pay $350 to $2,000 to brokers to get the $63 tickets
  • Some states have filed lawsuits related to the ticket brokering
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From Rich Phillips
CNN
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DAVIE, Florida (CNN) -- It's 7 p.m. Homework is done, and cheerleading practice is over.

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Miley Cyrus plays the popular Hannah Montana on a hit Disney Channel show.

Sisters Cara and Casey Von Minden, and their cousin, Amanda Flaherty, are more than comfortable on their couch in Davie, Florida. They're doing what millions of tweens across America are doing -- they're watching, "Hannah Montana."

"We didn't miss, like, any episodes of her, unless something really big was happening," said Cara, 12.

The hit Disney Channel show -- which stars 14-year-old Miley Cyrus and her country singer dad, Billy Ray Cyrus -- is about a teenage girl who's a typical high-schooler by day but has a secret pop-star alter ego by night.

If you have a child between 6 and 14, there's a pretty good chance you know Hannah. Nielsen Media research says more than two-thirds of U.S. kids in that age group watched the show in the third quarter of 2007.

So when Disney announced a 54-city concert tour, starting October 18 in St. Louis, Missouri, it was an obvious birthday present for Cara. But the day tickets went on sale, Cara's mom, Maureen Von Minden, found she was shut out before she got started.

Ticket brokers swooped up thousands of tickets within minutes of them becoming available online and shut out legitimate Hannah followers. Desperate fans found they would have to pay brokers $350 to $2,000 for the $63 concert tickets. Video Watch Billy Ray Cyrus talk about the soaring prices »

Von Minden lives in Florida -- in "Hurricane Alley." "We're hurricane people," she said. "It's price gouging ... price gouging at its best. It would have been my daughters' first concert for both of them, and we were looking forward as a family to going, and we can't," she said.

Concert promoters saw the phenomenon happening all over the country.

"Absolutely every show sold out within the same amount of time," said Debra Rathwell of AEG Live, the company handling the concerts for Disney. "Whether you were in Moline or Omaha or New York or Los Angeles, it sold out in minutes."

Ticket brokers use the Web to buy sports and concert tickets ahead of real fans, creating an almost $2 billion secondary market.

"Up to 80 percent of inquiries of tickets come from these brokers," said Gary Bongiavanni, editor-in-chief of Pollstar, a weekly media magazine that tracks concerts.

"The average fan is competing with a pro whose mission is to score these tickets. Fans are at a disadvantage," Bongiavanni said.

The profits go to brokers, not the artists or promoters. CNN tried to contact several different ticket brokers that did not return phone calls or e-mails. But the National Association of Ticket Brokers did return calls.

"When a ticket is hot, people sell them," said general counsel Gary Adler.

Only five states -- Michigan, North Carolina, Kentucky, Massachusetts and Rhode Island -- limit brokering, according to the National Association of Ticket Brokers. Regulations vary. For example, in Rhode Island, the cap on the amount of the increase is $3, or 10 percent above face value, whichever is greater.

Ticketmaster says online some brokers cheat to beat the system and the fans. Ticketmaster has filed suit in U.S. Federal District Court in Los Angeles against a Pittsburgh, Pennsylvania, software company that it claims developed software for ticket brokers that illegally "allows them to cut in line", said Ticketmaster vice president Joe Freeman.

The software company, RMG Technologies, denies that allegation. It says the company should not be held accountable because Ticketmaster is getting paid for the tickets it sells.

"This may be the only time in history ... that any seller sued its customers for paying them too much money," the attorney for RMG Technologies wrote in court documents.

Promoters and artists have tried different methods to recoup lost revenue.

For the Hannah Montana tour, AEG Live and Ticketmaster held an auction for tickets in some cities. But the auction, AEG concedes, was not for the average fan. The minimum bid for a single front-row seat at the Target Center in Minneapolis, Minnesota, was $2,605.

"... If the tickets go to brokers, then they pay a lot of money for them. And if the brokers are going to end up with the tickets, then the artist should get paid for them,"said Rathwell, whose company is handling the Montana tour.

The Hannah Montana concert ticket debacle also has gotten the attention of law enforcement. Attorneys general in Arkansas and Missouri have filed a suit accusing ticket brokers of illegally reselling tickets to Montana's "Best of Both Worlds Tour."

"When you allow the hijacking of the market, it's literally the worst of both worlds. You get charged too much, and there's no access for the locals," said Jay Nixon, Missouri's attorney general.

Experts say Disney and the Hannah Montana franchise are victims, too, but they see nothing that will hurt the Disney brand. Billy Ray Cyrus, Miley's dad, has commented on the issue.

"There is a law of supply and demand, and ... quite frankly, it's beyond our control. We put together a concert tour, and I was really excited about Miley going out and playing for the fans," he said. "That's what her tour is about. It's for the kids and all the families that are watching Hannah Montana."

A Disney representative told CNN, "It's really unfortunate, and there is nothing we can do to stop it. These inflated costs only benefit the brokers. We were very pleased to hear that various law enforcement agencies are beginning to look into these practices."

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Experts say that unless ticket broker prices drop as concert dates approach, there will be sold-out arenas with empty seats.

Lawsuits will not put smiles on the faces of disappointed kids and parents. But Casey, 10, said she has a suggestion on how to afford Montana tickets, and it falls on her 12-year-old sister: "Cara needs to get a job!" E-mail to a friend E-mail to a friend

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