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U.S. Olympic Ticket Reseller Finds Its Hegemony Threatened

For the past several Olympics, Americans looking to attend the Games have had to purchase from the same source: a small company based in New Jersey’s horse country, called Jet Set Sports. Also known by its trade name, CoSport, the firm has served as an official partner of Team USA since 1992, operating as the exclusive American gatekeeper of both single tickets and five-figure all-inclusive packages.

But now, after more than a dozen years of turnstile hegemony, the company’s controversial stranglehold on the U.S. Olympic ticket market appears to be in jeopardy. Jet Set is facing a class-action lawsuit for its refusal to guarantee total refunds for the fanless Tokyo Games, while doubt looms over the prospect of foreign fans being allowed at the 2022 Winter Olympics in Beijing.

Perhaps even more foreboding for Jet Set, which deals almost exclusively in Olympics tickets, is the International Olympic Committee’s plan to revamp its entire ticketing process, beginning with the 2024 Summer Games in Paris. The move could leave national ticketing partners like Jet Set on the outside of a new global marketplace. Yet in the face of these threats, Jet Set is projecting a sense of optimism.

“Since Sarajevo 1984, the core of our business has revolved around creating exceptional Olympic experiences for our customers, and it will continue to be so into the future,” CEO Alan Dizdarevic said in a statement. He declined to answer specific questions.

The IOC’s new plan would dramatically affect stakeholders across the U.S. Olympic movement. Jet Set is an official sponsor of Team USA, in addition to being the United States Olympic and Paralympic Committee’s “authorized ticket reseller.” To further complicate things, the USOPC also buys its own tickets and hospitality from the firm. The payments from Jet Set aren’t detailed in the committee’s tax filings, but from 2016 to 2019, Jet Set received roughly $24 million from the USOPC, the highest figure for an independent paid contractor.

Representatives for the USOPC and IOC declined to comment.

Ticketing for each Olympic Games is handled by the local organizing committee, under the direction of the IOC. Hundreds of thousands of tickets are distributed every Olympiad to national committees or to their authorized ticketing resellers. Those firms typically sell a portion of tickets as one-offs, but they make the bulk of their profit by grouping tickets into pricey hospitality packages that can include food, travel, hotels and other events on the ground.

Olympics ticketing is always big business, but demand varies depending on the location of the Games, capacity of the venues and and other tourism factors. The ticket program for the 2012 London Summer Games, for example, generated $988 million in sales; Rio’s generated just $321 million four years later.

Jet Set’s relationship with Team USA dates back to 1992, when it became the USOPC’s hospitality agent for both the Summer and Winter Games. In the early 2000s, the company became an official Team USA sponsor and expanded its hospitality arrangement to include event tickets, starting with the 2006 Winter Olympics in Turin.

In addition to the U.S., Jet Set has also been the Tokyo Games authorized ticket reseller for the national teams of Jordan, Bulgaria, Croatia, Australia, Greece, Norway and Sweden. The Australian Olympic Committee’s current commercial agreement with Jet Set extends beyond the Paris Games in 2024. A spokesman for the AOC declined to address whether the IOC’s change in ticketing plans would impact its relationship with CoSport.

The International Paralympic Committee’s agreement with Jet Set also expires after the Tokyo Games. A spokesman for the IPC, Craig Spence, declined to say what, if any, discussions the organization has had with Jet Set.

Though Jet Set’s arrangement with Team USA was set to expire after Tokyo, the company ultimately extended the relationship through Beijing, according to multiple people familiar with the deal. It’s unclear whether that extension will ultimately backfire for Jet Set, but right now there’s cause for concern. The Beijing Games have become a political lightning rod in the U.S., with bipartisan members of Congress calling for the event to be relocated out of China for human rights reasons. With Beijing’s opening ceremony just six months away, tickets still have not been distributed, and the rising global count of COVID-19 cases has cast a pall on transcontinental travel.

Putting aside politics and the pandemic, the IOC’s nation-by-nation structure has created an inconsistent network of ticketing, where fans in the United Kingdom have different options than fans in the U.S. Now, in concert with the organizing committees for the upcoming Games in Paris, Milan/Cortina and Los Angeles, the IOC has said it will centralize the process. In its official announcement, IOC president Thomas Bach said the move would lead to “better oversight and, with this, to good governance.”

To that end, in June the IOC named Endeavor’s On Location Experiences as its global hospitality partner, tasking that company to streamline its set of options for fans, sponsors and corporations. The committee’s next step is to do the same for ticketing, and, although it has yet to name its official partner, industry insiders believe Alibaba is a front-runner for that business. The Chinese e-commerce giant became an IOC partner in 2017 and has a domestic ticketing deal with the 2022 Games.

All this loosens the grip of Jet Set, which bid for the hospitality role that went to On Location, but wasn't one of the handful of finalists, according to people familiar with the RFP process. The Olympics, more than almost any other sporting event, attempts to build a moat between official partners and those on the outside. Losing out on its direct access to tickets through Team USA or the local host committees means losing out on Jet Set’s main business advantage.

That said, should the company want to remain in the Olympic movement—which it adamantly insists it does—industry experts still see some moves for it to make. For one, it might already have contracts in place for hotels and restaurants for upcoming games. It could keep those in place and try to build a hospitality business outside the official marketplace by acquiring tickets on its own.

It also has decades of relationships and expertise in Games tourism that could make it an acquisition target, or a potential consultant for Olympic sponsors and delegations. However, those advantages are due to fade with time, as it will likely be harder and harder to remain relevant the further removed Jet Set is from its official perch.

“It’s less likely that [Jet Set] is going to be a public-facing entity associated with the Olympics,” said Ken Hanscom, COO of TicketManager, which helps manage ticket inventory for dozens of companies, including some Olympic sponsors. “But they have a lot of opportunities behind the scenes to continue to provide logistics, execution and support for companies that have relied on them for years.”

If the landscape itself doesn’t breed confidence, the company could find hope in its own mercurial history.

Jet Set founder and chairman Sead Dizdarevic, Alan’s father, has proven capable of defying predicaments before, having avoided prosecution in the mid-1990s by turning state’s evidence and agreeing to testify about his involvement in an alleged scheme to bribe Salt Lake City Olympic bid committee officials. After being granted immunity by federal prosecutors, Dizdarevic acknowledged giving $131,000 in payments to John Krimsky, then the chief marketing official for Team USA, to help secure Jet Set’s contract with the USOPC. Krimsky eventually resigned, as did several higher-ups, who were charged with bribery and fraud.

Amid all the chaos of Salt Lake City, Dizdarevic came away with the keys to a golden gate: the exclusive American reseller rights. All the while, controversy and criticism have hung above Jet Set, such as when Dizdarevic reportedly hired the girlfriend of an IOC committee member ahead of the Sydney Games. During the London Games, Jet Set was the subject of hundreds of complaints from American ticket purchasers who, according to The Guardian, were forced to wait in lines for up to six hours.

Now, Jet Set is facing a more menacing revolt from its consumer base. In April, five Jet Set customers, who had each spent thousands on Tokyo Olympic ticket packages, filed a federal class action lawsuit against the company over its current refund policy, which offers to guarantee only 75% of what the customers spent or provides a 100% credit that can be applied to a future Olympic Games. Ticket resellers in other countries, such as ATPI in Canada, offered full refunds. The suit, which alleges breach of contract and consumer fraud, accuses Jet Set of seeking to “retain its profit from selling worthless tickets and accommodations.”

Jet Set, whose business wasn’t covered by insurance, has vehemently disputed this characterization, saying the remaining 25% of the ticket packages is at the mercy of third-party providers and that the company will pass on to customers any of those funds it retrieves.

Last week, as Sportico first reported, Jet Set filed a motion to dismiss the suit, arguing that it had gone above and beyond in an effort to make its customers whole, having already shelled out more than $23 million in refunds, with the expectation that it would pay an additional $9 million. The company said the 75% cash refund offer was made “at great expense and at its own detriment,” characterizing the plaintiff’s action as proof that “no good deed goes unpunished.”

Given where things stand, Jet Set may soon be demonstrating another piece of conventional wisdom: that all good things must come to an end.

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