June 26th, 2012
The Transom flags an fascinating WSJ piece today on how Orbitz presents Mac users with different, pricier, results than it does PC users.
I’ve long suspected that the internet is allowing retailers to do lots of this sort of thing–and more. It would not surprise me to learn that some e-commerce sites even use intentionally elastic pricing, so that an item is slightly more expensive if the prospective buyer is on a Mac or located in a wealthy zip code, or some other thing.
If websites did this sort of thing, it would be really, really hard for consumers to find out about it. I can’t even keep track of price stability in my own life: I suspect that I’ve seen Amazon raise the price on certain items that I’ve window-shopped, so that they’re more expensive the second or third time I look at them. But I couldn’t swear to it.
But the larger question is, would it be legal to price identical goods differently for different internet users? On the face of it, you’d think yes. Brick-and-morter stores achieve elastic pricing through the use of coupons and sales.
Yet that’s a little different than targeting individuals for different prices, the way a website might.
I suspect it would come down to the criteria being used. It might be legal to charge people using, say, the Safari browser, a higher price. But it would surely be illegal for a retailer to charge a higher price to a zip code because its population was predominantly African-American.
Maybe this is a world like employment discrimination, where a certain degree of latitude is allowed, depending on who’s being discriminated against.
I’d be interested to hear from anyone who knows the law on this.
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If price discrimination were illegal, Priceline would be out of business, you figure.
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Probably not. Secondary-line discrimination under Robinson-Patman has to be anticompetitive. This is price discrimination as to ultimate consumers, so it’s not.
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Pong 1.2 for $369 on circuitcity.com. Can anyone confirm that? (I’m on a Kaypro.)
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If you put an item on your wish list on Amazon, they will now tell you what the price was the day you put the item on the list.
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Supermarkets have been individually price-discriminating based on your loyalty club card-registered behavior using coupons for a long time now.
When I was in corporate America, we mostly used these new fangled personal computers to try to solve problems. But now information technology is used increasingly to outsmart customers.
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If they make it clear that this is how they price things, then we’re all aware of the practice and we can decide if we want to purchase from Orbitz or not. If they don’t clearly post the information, it still shouldn’t be illegal, but it’s definitely immoral.
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[…] users make roughly $25,000 more on average than PC users. Jonathan Last wonders: Would there be anything illegal about using elastic pricing keyed to what make of computer […]
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[…] users make roughly $25,000 more on average than PC users. Jonathan Last wonders: Would there be anything illegal about using elastic pricing keyed to what make of computer […]
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[…] to our discussion yesterday, Galley Lawyer X sends in the following thoughts: I have a hard time seeing how targeted pricing […]
Jim S. June 26, 2012 at 12:06 pm
Would Robinson-Patman not apply here?
http://www.law.cornell.edu/uscode/text/15/13