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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

#471

Post by bobthepanda »

tmoertel wrote: post #131
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…

The classic way that businesses openly coordinate their pricing is via price matching. Businesses advertise their preferred prices but also promise that they'll match lower prices from competitors. Competitors see these advertisements and set their own prices to approximately match. The FTC does not consider this type of open signaling to be price fixing: > Q: Our company monitors competitors' ads, and we sometimes o…

that's not really price fixing in so much that price matching in this manner is known to lead to a race to the bottom.

this is very different from, "leasing agent, set this high price or get fired by your employer."

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

#472

Post by jimbob45 »

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…

Price fixing would be if both gas stations decided to raise their price to $4.45 at the same time so that customers don't have a choice.

Which was the case in this instance. RealPage required subscribers to use their price suggestion some percentage of the time or they'd risk losing their subscription.

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

#473

Post by bobthepanda »

RhodesianHunter wrote: post #118
bick_nyers wrote: post #18

Earlier quoted context omitted.

Housing is pretty inelastic. I think people are just willing to suffer financially to avoid the fate of homelessness. Just because there aren't vacancies anywhere doesn't mean that the price is fully justified, because housing will take priority over groceries for a lot of people.

Housing supply is inelastic due to the time it takes to permit and built. Housing demand is more elastic than you suspect. People have income on a curve, and at a certain point of price/quality will move further out and commute or move to a lower cost of living city entirely.

The NYT recently did a piece on how the tendrils of the housing crisis have made it out to places like Kalamazoo, MI that are not really traditionally high COL cities with booming economies. https://www.nytimes.com/2024/08/22/business/economy/housing-...

We are running out of cheap places to live in. Remote work has mostly pushed the crisis to other places without a corresponding pressure release in the high COL areas.

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

#474

Post by hoosieree »

sithadmin wrote: post #438
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.

Not just by algorithm. In the US, many large employers utilize 'The Work Number' by Equifax for employment verification services, and share details about individual employees as granular as individual paycheck disbursements. This information is visible to other employers that buy in to the scheme, and obviously favors the employer in salary negotiations with a candidate.

Data brokers are a scourge. They should be illegal, or at the very least regulated.

For example, here's an idea for one such regulation:

    If the company purchases aggregated salary data, they must publish their own salaries for at least 1 year.

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

#475

Post by crowcroft »

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.

Applying macro data to micro use cases without appropriate carve outs is one of the greatest sins in statistics, and yet it happens everywhere.

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

#476

Post by BurningFrog »

lukev wrote: post #464
jonas21 wrote: post #462

Earlier quoted context omitted.

If instead the 2 gas stations were both selling at $4.45 and looked around and decided not to lower their prices to $4.15 even though they could, it's equivalent.

Or one of them could lower to 4.35 and take all the business. Which is normally what would happen without collusion.

I don't have a source for this, so take it as you wish, but as I remember what I read, duopolies can be quite stable. Three party cartels can go either way.

But with 4 or more participants, someone will inevitably betray the others out of greed.

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

#477

Post by Miraste »

colonCapitalDee wrote: post #456
ang_cire wrote: post #421

Earlier quoted context omitted.

> 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 p…

No, your time horizon is too short. Prices go up in the short term, which increases profits, which incentivizes competition, which brings prices down in the long term. A few years of increased prices is worth increased efficiency over decades. Prices are going in most industries, US markets are generally quite competitive.

Increasing profits often doesn't incentivize competition, especially when barriers to entry are high. Instead, it decreases competition by giving existing corporations even more money and power to use against newcomers. Look at what happened to Bandcamp: bought up by a music licensing company and gutted.

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

#478

Post by henryfjordan »

sithadmin wrote: post #438
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.

Not just by algorithm. In the US, many large employers utilize 'The Work Number' by Equifax for employment verification services, and share details about individual employees as granular as individual paycheck disbursements. This information is visible to other employers that buy in to the scheme, and obviously favors the employer in salary negotiations with a candidate.

Honestly what you describe is less likely to run afoul of antitrust law than hiring some firm who has all that data to tell you what salary to offer. At least you are looking at data and competing, not just paying some consultant to tell you and every other company to lower salaries.

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

#480

Post by jacobgkau »

amatecha wrote: post #479

Now can we do airlines and hotels?

While I can appreciate your frustration with the airline and hotel industries, I have to pay rent a lot more often than I have to buy plane tickets or hotel rooms, so I'd be glad to start with this one.
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