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Would this not get AirBNB into trouble? Price fixing in a cartel is illegal anywhere in the western world for good reason.
This is not price fixing or anywhere even slightly related
How is that not exactly price fixing?
This is the difference between airbnb and google. Google would have Hal Varian look at this. Airbnb has a music major re-invent the wheel (not sure if the managed to re-invent the whole thing). There is a whole field of study called pricing mechanisms. For example, second price auctions work well because of a reason.
Also, Google is not that great at some things they do. For example, Google is somehow much worse at navigation than Waze even though they were at it for much longer and had tons of data. Now they even have Waze data and are still worse at it than Waze.
I work at a company that has pricing algorithms more complex than what retail stores use. I don't think they are useless. But, we all know they aren't "right", and they only got to be what they are through testing them out with actual customers. And some customers work to determine your algorithm and then use it to their advantage in a big way so you have to change it again, which affects other customers negatively, and the cycle continues. You can't just A/B test pricing and assume that will work in a hands-off fashion either, because customers will take advantage of that.
The complexity of pricing is that the best pricing only partly has to do with the thing being sold. You could argue it has nothing to do with the thing being sold. It has everything to do with the buyer: their needs, their resources, and their perception of the product, service, seller, the entire sales experience, market, economy, weather, etc. You name it and it probably has some affect on what the best price would be.
Earlier quoted context omitted.
This is not price fixing or anywhere even slightly related
AirBNB is colluding with its contractors to influence and set similar prices across competing room vendors. How is that not exactly price fixing?
For two, they're not actually setting the prices, the property owners are doing that. They're recommending prices, which is very different.
Feels kinda weird to be defending AirBnB, since I work for Homeaway.
ETA: Probably the closest analogy would be the infamous Manufacturer Suggested Retail Price, which is quite legal as long as they don't actually force the retailers to stick to it.
Earlier quoted context omitted.
This is not price fixing or anywhere even slightly related
AirBNB is colluding with its contractors to influence and set similar prices across competing room vendors. How is that not exactly price fixing?
This isn't price fixing because companies aren't considered their own competitors.
It might be a little fuzzy if the people posting rooms on AirBnb are considered competitors, but even then it's not price fixing because there's no requirement to use the algorithm's suggested price, and no single owner can influence the general price of rooms, because there's still hotels, motels, non-AirBnb rooms, etc.
Completely solving the problem of pricing in term of getting it right the first time is more difficult than predicting the weather. At least with the weather you can go outside and learn if it is raining. You can't just go outside look at an item and give it an optimal price that maximizes the amount and/or the amount of time you need to sell it within. I work at a company that has pricing algorithms more complex tha…
Almost all machine learning tools are classifiers of some sort. It's like saying: we selected a car technology called "wheel".
Completely solving the problem of pricing in term of getting it right the first time is more difficult than predicting the weather. At least with the weather you can go outside and learn if it is raining. You can't just go outside look at an item and give it an optimal price that maximizes the amount and/or the amount of time you need to sell it within. I work at a company that has pricing algorithms more complex tha…
It would be a shame if AirBnb would price gauge based on profiling customers. I don't like, when I enter a shop, to be asked my nationality before they quote me a price.
Completely solving the problem of pricing in term of getting it right the first time is more difficult than predicting the weather. At least with the weather you can go outside and learn if it is raining. You can't just go outside look at an item and give it an optimal price that maximizes the amount and/or the amount of time you need to sell it within. I work at a company that has pricing algorithms more complex tha…
It would be a shame if AirBnb would price gauge based on profiling customers. I don't like, when I enter a shop, to be asked my nationality before they quote me a price.
This is the difference between airbnb and google. Google would have Hal Varian look at this. Airbnb has a music major re-invent the wheel (not sure if the managed to re-invent the whole thing). There is a whole field of study called pricing mechanisms. For example, second price auctions work well because of a reason.
Why attack Airbnb for trying out a new approach? Also, Google is not that great at some things they do. For example, Google is somehow much worse at navigation than Waze even though they were at it for much longer and had tons of data. Now they even have Waze data and are still worse at it than Waze.