At The Money: Is Technology Price Gouging Consumers?

RealPage

• Lindsay Owens · Groundwork CollaborativeBearish

  RealPage's YieldStar software enables rent price-fixing among landlords; the 2024 DOJ settlement was too lenient.

  YieldStar, RealPage's revenue management software, lets landlords share competitively sensitive data on floor plans, amenities and price points, and it recommends rents. Many landlords default to following those recommendations, so algorithms make coordination possible in fragmented markets with thousands of landlords, where a traditional cartel would have been hard to form. The Biden DOJ brought a price-fixing charge in late 2024, and the Trump administration settled. Owens calls the settlement a slap on the wrist, though it curtailed the most egregious parts, including in-person landlord meetings. The advisers RealPage used to push landlords to follow the prices may be hard to police, since people cannot easily forget what they learned. Some estimates put RealPage's effect on rents at up to $120 a month.

  “And YieldStar, the revenue management software that RealPage acquired, allows landlords to share competitively sensitive information about floor plans and amenities and price points, but it also spits out recommended rents.”at 8:04

Walmart

Across the shows: 1 speaker in other episodes, 0 bullish and 1 bearish calls, past 30 days

• Lindsay Owens · Groundwork CollaborativeBearish

  Walmart filed a 2023 patent for price changes based on shoppers' purchases, such as tuna raising mayo prices.

  Owens says Walmart filed a 2023 patent for scan-and-go technology connected to electronic shelf labels. The system tracks what a shopper is already buying and changes prices on other items. The patent's own example is tuna fish in the cart leading to a higher price on mayonnaise. Walmart says it is not using the patent, but Owens notes it built the technology and filed for it. The patent runs through 2039, and Walmart says it will not renew it then. Owens says that does not give her much comfort. She also cites a Walmart patent for using imagery to detect whether a car's suspension has changed as a shopper leaves the store, as evidence of the data companies are building to price against shoppers.

  “They filed for a 2023 patent that did exactly what you described, used scan and go technology connected to electronic shelf labels to track what you were already buying, say tuna fish.”at 16:33

Delta Air Lines

• Lindsay Owens · Groundwork CollaborativeBearish

  Delta teamed with AI pricing firm Fetcher to raise fares, expanding its share of fares it lets the AI set.

  Owens says Groundwork found this in the transcripts of Delta's investor day calls, not through sophisticated investigation. Delta teamed up with Fetcher, an Israeli AI pricing company, to raise flight prices. CEO Ed Bastian praised Fetcher and the revenue boost it delivered. Delta initially gave the AI company 1% of its fares to experiment with and, after liking the results, planned to give it 20% of fares by year-end. Owens argues companies tell investors things about their pricing that look bad once consumers learn them, because management wants to show strong revenue and may be tying compensation to the share price.

  “And Delta had teamed up with Fetcher to hike prices on flights.”at 20:03

Maplebear Inc. (Instacart)

Across the shows: 1 speaker in other episodes, 1 bullish and 0 bearish calls, past 30 days

• Lindsay Owens · Groundwork CollaborativeBearish

  Instacart charged different shoppers different prices for identical carts, up to 23%; it later stopped the tests.

  Groundwork Collaborative, working with Consumer Reports and More Perfect Union, recruited 400 secret shoppers across Ohio, Seattle and Washington DC. They used the same pickup location and the same 23 items and screenshotted their carts. For almost 75% of items, Instacart charged shoppers different amounts, with gaps as high as 23%. For example, one shopper could pay 23% more than another for a dozen eggs at the same Safeway in DC at the same time. Owens estimates this could cost some families $1,200 a year. The story ran on the New York Times front page, the stock fell sharply, and the FTC and New York attorney general opened probes. About two weeks after the study, Instacart said it would stop running these experiments and that shoppers in the same store at the same time would get the same price.

  “And what we found is for almost 75% of the items in the cart, Instacart was charging some shoppers different amounts than other shoppers, and those differences were as high as 23%.”at 22:18

Antitrust & tech regulation

• Lindsay Owens · Groundwork Collaborative

  Rising industry concentration is terrible for prices, and new pricing tech thrives in consolidated markets.

  Owens says about 75% of US industries are more concentrated than they were a generation ago, which is terrible for prices. Competition works because shoppers can walk across the street to a better deal, and that is hard to do when a few firms dominate. Consolidation also makes markets a petri dish for more sinister pricing technologies. Personalised pricing adds to the problem even in competitive markets, because shoppers cannot comparison-shop against a standard price. Her argument is that consolidation and new pricing algorithms feed one another.

  “Concentration in our economy, 75% of industries more concentrated now than they were a generation ago, is terrible for prices.”at 11:58

Consumer & retail

• Lindsay Owens · Groundwork Collaborative

  Surveillance pricing squeezes all consumers, and better willingness-to-pay estimates will capture most surplus regardless of income.

  Owens rejects the idea that surveillance pricing is a corporate Robin Hood, where the rich subsidise lower prices for the poor. She argues the aim is to squeeze everyone as much as possible, so lower-income shoppers may be squeezed less but everyone still pays more. Willingness to pay and income are not the same. Desperate buyers, such as someone who must fly to a funeral or buy children's medicine for a sick child, will pay more. As firms get better at estimating willingness to pay, she expects them to capture most of the consumer surplus whatever a shopper's income. Her examples include Expedia charging people from higher-income areas more for the same Manhattan hotel room, and the data firms collect, from car type to a child's age, that feeds this pricing.

  “the goal of surveillance pricing is to squeeze everyone as much as they can.”at 24:19

Consumer AI products

• Lindsay Owens · Groundwork Collaborative

  AI shopping assistants may help shoppers, but they raise risks once they have access to consumers' data and wallets.

  Owens says AI shopping assistants, such as agentic commerce tools and Meta's Muse, promise to help consumers escape subscription traps and navigate e-commerce. She sees a new phase in which technology promises a lot and brings peril. Her concern is what these assistants could do with all the data they collect and what happens when an AI agent has access to your wallet. She does not say whether the result will be good or bad and leaves that open.

  “What will happen when an AI agent has access to your wallet? Will that be good or bad? You decide.”at 26:45