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DOJ sues realpage for algorithmic pricing scheme that harms renters

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Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#421

Post by ang_cire »

bogwog wrote: post #213
jasode wrote: post #191

Earlier quoted context omitted.

>, a gas station isn't going to look at a competitor selling gas at $4.15 and decide to raise their price to $4.45. They would lower their price to match the competition, otherwise they'd lose sales and make less money. But the airlines are also doing the opposite of your scenario: they also raise prices instead of lower them via legal "price signaling" via publicized fares[1] in the global reservations system. Compe…

> Competitors can converge on a higher price instead of a lower price. It's not just one direction. They just need to do it via public price signaling to stay out of legal trouble. I don't understand what you're saying. Are you saying that companies are colluding, but not really because the prices are public? Most prices are public, just walk into any supermarket or open Amazon.com and you'll see public prices. If a…

> If a company is able to price a product above their competitors and still succeed (e.g. by investing more in marketing), that's legal too.

Yes, but it also runs counter to the idea that free markets tend to drive prices down through competition. In reality, 1 of 2 things happens:

a) companies try to differentiate their products enough to not be direct competitors (e.g. exclusive content on streaming platforms, or platform lock-in), and both/all charge more

b) one company buys the other to kill their competition

No one actually lowers their prices to compete anymore, because we abandoned enforcing anti-trust and anti-monopoly laws decades ago.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#422

Post by seanmcdirmid »

HDThoreaun wrote: post #416
seanmcdirmid wrote: post #406

Earlier quoted context omitted.

Commie blocks don’t work, just ask China who has an even more messed up property market than we do.

The chinese property bubble was created because of the lack of equity markets for chinese investors to dump money in. Without good investments to be had the chinese turned to pure speculation in the real estate market. Their housing market is actually quite good at providing housing, in fact theyve lifted 800+ million people out of poverty in the last 80 years. Just the crappy financial regulations that caused the pr…

The construction industry really is a jobs program for rural surplus labor, they’ve optimized their construction techniques for that with the same 30 story blocks with slightly overbuilt concrete walls and floors. But they have surplus units and even in hot cities like Beijing or Shanghai you’ll find empty apartments that haven’t even been renovated yet. It’s not clear where this will end.

The American market has lots of speculation. Many landlords are just in it for the appreciation given that they can’t even make a mortgage payment with rent, I know of multiple homes in my (Seattle) neighborhood owned by Chinese investors that are barely lived in.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#423

Post by bluGill »

coding123 wrote: post #247
dwaltrip wrote: post #196

Earlier quoted context omitted.

And if there is a third also selling at $4.10? Unless they privately coordinate and collude, its hard for this to work for artificial price increases.

I think one thing that's weird to me is that Shell and Exxon or 76 or whatever all somehow got their gas to be somewhere in the same ballpark. You'd expect to see that some gas companies can't get their shit together and can't figure out how to extract, purify, and distribute gas at anything less than $500 per gallon. Now, naturally you'd expect those companies to just go out of business. And you'd also expect to see…

They are all selling the same gas from the same refinery. They might have slightly different additives but otherwise it all comes from the same place. you can't afford shipping costs to get gass from a different refinery (unless you are on a territory border)

the only question is how much profit to put on top and even then they have to be careful as if they go too low their competetors won't follow and then they have to pay extra for an unscheuled delivery just to fill their tank.

i'm reasonable certian that small stations are illegally colluding in some cases.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#424

Post by eldridgea »

ndesaulniers wrote: post #417

Companies are culluding to suppress wages by algorithm, too. Look up a company called Aon, and their product called Radford Data & Analytics.

~2019 I led a team of highly qualified security R&D folks inside Cisco (we were part of an acquisition), these folks were effectively highly specialized SWEs. But because the title was something like "security researcher" it was compared against the closet Radform ladder which was closer to to compliance officer.

This meant the specialists were on a ladder with often lower pay than a standard SWE, and I couldn't shift the bureaucracy enough to change that. People left for all sorts of reasons but a big part was being able to get 2x-4x the total compensation at other companies.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#425

Post by insane_dreamer »

bogwog wrote: post #152
jasode wrote: post #19

>Armed with competing landlords’ data, RealPage also encourages loyalty to the algorithm’s recommendations through, among other measures, “auto accept” functionality and pricing advisors who monitor landlords’ compliance. I think the "private prices" + "autoaccept" + "compliance" is the key misbehavior that gets RealPage into legal trouble. If competitors want to converge on prices in a legal manner , they have to do…

I think you're over analyzing and confusing things. Price fixing is when competitors work together to raise prices above what they would normally be in a competitive market. Using your gas station example, a gas station isn't going to look at a competitor selling gas at $4.15 and decide to raise their price to $4.45. They would lower their price to match the competition, otherwise they'd lose sales and make less mone…

> They would lower their price to match the competition, otherwise they'd lose sales and make less money.

- they could also see their competitor raise their price to from $4.00 to $4.15 (for whatever reason) and decide that they can raise their price as well without losing customers.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#426

Post by ineedaj0b »

This case -like the Sackler case- I hope they burn the company down with malice to make an example.

I have similar feelings about Airbnb. I think they caused a good deal of harm, but I'm more kind to the argument they are allowing market forces to act. People are priced out by mid-level wealth holders in nice locations who rent out to tourists; homes young families could have enjoyed. Airbnb could be a net harm on society ~30 years from now. Still too early to tell imo

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#427

Post by curiouscavalier »

coding123 wrote: post #247
dwaltrip wrote: post #196

Earlier quoted context omitted.

And if there is a third also selling at $4.10? Unless they privately coordinate and collude, its hard for this to work for artificial price increases.

I think one thing that's weird to me is that Shell and Exxon or 76 or whatever all somehow got their gas to be somewhere in the same ballpark. You'd expect to see that some gas companies can't get their shit together and can't figure out how to extract, purify, and distribute gas at anything less than $500 per gallon. Now, naturally you'd expect those companies to just go out of business. And you'd also expect to see…

Many do go out of business, and many substantially undercut others. This is particularly true for the diesel market, where OTR truck operators are more price sensitive. Most stations are buying gas around similar prices at the terminal, but their overhead to provide the station can vary wildly between large chains and small, family owned stations.

“Skimmers” (drastically lower-priced diesel stations) are a real threat to larger chain stations. They don’t put them out of business entirely for a number of reasons, but one is because gas stations ultimately sell more than gas/diesel (e.g. a clean bathroom is often worth a few extra cents per gallon for me, but there’s a lot more than that too). Also any given station can’t sell an infinite amount of fuel. Beyond tank capacity, wait times are a real impact on sales volume, and so if a station offers a price too low (even if still profitable), it is just leaving money on the table.

So not to say collusion doesn’t happen, but one can also arrive at similar pricing with a commodity like gas without it. Especially since fuel margins are typically low.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#428

Post by HDThoreaun »

seanmcdirmid wrote: post #422
HDThoreaun wrote: post #416

Earlier quoted context omitted.

The chinese property bubble was created because of the lack of equity markets for chinese investors to dump money in. Without good investments to be had the chinese turned to pure speculation in the real estate market. Their housing market is actually quite good at providing housing, in fact theyve lifted 800+ million people out of poverty in the last 80 years. Just the crappy financial regulations that caused the pr…

The construction industry really is a jobs program for rural surplus labor, they’ve optimized their construction techniques for that with the same 30 story blocks with slightly overbuilt concrete walls and floors. But they have surplus units and even in hot cities like Beijing or Shanghai you’ll find empty apartments that haven’t even been renovated yet. It’s not clear where this will end. The American market has lot…

They build the same building over and over again because theyve had to create litearlly a billion units in the last 50 years and it's faster that way.

There are unsold units because the price went crazy due to speculation. Empty housing is one of the main indicators of a real estate bubble. American vacancy rate has slowly crept up but is still extremely low outside of manhattan. Americans tend not to believe housing will appreciate faster than the stock market, so housing speculation is limited, although of course not unheard of. We'd need LVT for that.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#429

Post by ndesaulniers »

eldridgea wrote: post #424
ndesaulniers wrote: post #417

Companies are culluding to suppress wages by algorithm, too. Look up a company called Aon, and their product called Radford Data & Analytics.

~2019 I led a team of highly qualified security R&D folks inside Cisco (we were part of an acquisition), these folks were effectively highly specialized SWEs. But because the title was something like "security researcher" it was compared against the closet Radform ladder which was closer to to compliance officer. This meant the specialists were on a ladder with often lower pay than a standard SWE, and I couldn't shif…

Sounds like first hand experience observing wages being suppressed as a result of Radford/Aon.
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