> So companies in the future will not be able to subscribe to another companies algorithms? How is this a lot different?
A lot different... keep reading more.
> Tons of companies use credit bureaus to get the sameCredit data for pricing loans to people
Except credit bureaus (1) are a regulated entity. You can't just use credit data freely, and you can't use any data to write loans. Loans can only be priced using approved credit data from a credit bureau.
(2) Credit bureaus don't price loans. Full stop. Credit bureaus provide risk analysis, it is up to the underwriter to price that based on the provided risk. They provide a score and details on lines of credit. They don't tell you how to price your credit product, nor if you should provide such a service.
> Tons of companies use prices when setting contracts
Yes.
> in a ton of products (metals, food, stocks, and on and on)
Not all of those are "products", some of them are "securities", but yea. Notably, everything you mentioned is a clear commodity.
> those prices are aggregated and curated and that information is sold to all the other companies
More or less.
> thus setting prices
Sorta... thus influencing prices but not directly setting them.
> Stop companies from being able to access this pricing
Companies won't be stopped from accessing pricing data about the market.
> consumers will face more costs as each company has to gather/curate it's own pricing.
The act of gathering and curating data to make pricing decisions is the exact role of a business. Each business. Except basically under the American image of what communism is, I guess. But every business is responsible for their pricing.
> There are so many companies whose sole purpose is to set pricing so other companies do not have to do it in house that picking out this one seems ludicrous.
I'm not sure I agree with any of this statement. Few companies dictate pricing to other companies. Everything about this sentence screams collusion.
> I fail to see how this is much different except that it's politically popular.
Everything about everything is political. The laws are political. The justice system is political. The issues the government fights are political. What would politicians do but politics?
> Rental property owners are not forced to use it, and even have the traditional market forces not to use it: undercut the algo prices and get more business.
And yet it's quite popular in certain markets, and has demonstrated raising prices. The problem with this assumption is the housing market isn't a great efficient commodity market. Moving has extremely friction cost, supply isn't elastic, and a supplier can't easily make more housing units to trade margin for volume. Some housing markets are extremely tight and expensive.
This case is basically text book collusion, wrapped up in a politically relevant bow. As other commenters described, this company requires you to collude by forcing you to use their pricing.
> Or I simply stop using their pricing, undercut my competitors, and gain tenants. Same as before.
Except the landlords signed a contract... they legally bound themselves to using their pricing.
Also the market keeps changing, so you'll need their pricing in the future (so you can't break your contracts), or you'll need to do your own independent market research without access to their data.
> It's pretty hard to set market prices with literally millions of competing landlords.
What's the most important rule in real-estate? Location. Location. Location.
"Market" prices, obviously, apply to a "market". There are not millions of landlords in any given real-estate market. You can't compare a studio in Manhattan to a townhome in SF and a ranch house in Houston. No one is actually shopping for a rental and considering all those options. The entire US is not one market.
The housing market in many parts of America do not operate like a traditional commodity market. Demand outpaces supply, and landlords can't just make more units to compete on margin - most landlords have very low vacancy rates already. There is no incentive to undercut your competition when you can fill units at higher prices with no drop to vacancy rates through cooperation.
If it was this easy, the company wouldn't exist and the suit wouldn't be moving through the courts.
Contracts aren't infinite. And contracts have to follow the law.
> so you'll need their pricing in the future (so you can't break your contracts), or you'll need to do your own independent market research without access to their data
>The entire US is not one market.
Are you trying to claim that of the millions of landlords, somehow they are clustered away from bigger markets and that RealPage controls all in any given area?
Here's an idea: demonstrate that in some big market that RealPage controls the majority of the rental units, otherwise it's ludicrous to say they are setting prices somehow arbitrarily. You can't since it's not true.
I think not.
> Contracts aren't infinite. And contracts have to follow the law.
Yes! And the RealPage contract broke the law. It prevented landlords from competing as you suggest they compete, breaking the law. It enabled landlords to collude and prevent prices from dropping.
Landlords are part of larger markets, but it’s ridiculous to think the market is “all of America”. It’s very regionalized and segmented.
> Here's an idea: demonstrate that in some big market that RealPage controls the majority of the rental units, otherwise it's ludicrous to say they are setting prices somehow arbitrarily. You can't since it's not true. I think not.
You absolutely can claim they are setting pricing arbitrarily… why are you defending a company whose business you seem to know nothing about? Again, their entire business model is a subscription to collusion pricing. Collusion is illegal event without a monopoly.
They are price fixing. They are not alleged to have a monopoly over housing units. That said, they are alleged to have a monopoly power…
According to the DOJ:
> The complaint separately alleges that RealPage has unlawfully maintained its monopoly over commercial revenue management software for multi-family dwellings in the United States, in which RealPage commands approximately 80% market share.
> ts monopoly over commercial revenue management software for multi-family dwellings in the United States
Yes, if define a market small enough, then you can try to claim monopoly (which, of course, is not illegal). Apple fixes prices of it's goods across all retailers, as do many manufacturers. Is this illegal? They control the market for apple good, so why don't the retailers compete on price?
Because it is legal for somone to set prices across retailers. It always has been. And in the case of landlords, the sheer number of options for consumers most likely means this DOJ action, like many, will fail.
You forgot to reply to:
> demonstrate that in some big market that RealPage controls the majority of the rental units,
I'll wait. Unless you care to answer this basic question there's no reason to continue.
A lot different... keep reading more.
> Tons of companies use credit bureaus to get the sameCredit data for pricing loans to people
Except credit bureaus (1) are a regulated entity. You can't just use credit data freely, and you can't use any data to write loans. Loans can only be priced using approved credit data from a credit bureau.
(2) Credit bureaus don't price loans. Full stop. Credit bureaus provide risk analysis, it is up to the underwriter to price that based on the provided risk. They provide a score and details on lines of credit. They don't tell you how to price your credit product, nor if you should provide such a service.
> Tons of companies use prices when setting contracts
Yes.
> in a ton of products (metals, food, stocks, and on and on)
Not all of those are "products", some of them are "securities", but yea. Notably, everything you mentioned is a clear commodity.
> those prices are aggregated and curated and that information is sold to all the other companies
More or less.
> thus setting prices
Sorta... thus influencing prices but not directly setting them.
> Stop companies from being able to access this pricing
Companies won't be stopped from accessing pricing data about the market.
> consumers will face more costs as each company has to gather/curate it's own pricing.
The act of gathering and curating data to make pricing decisions is the exact role of a business. Each business. Except basically under the American image of what communism is, I guess. But every business is responsible for their pricing.
> There are so many companies whose sole purpose is to set pricing so other companies do not have to do it in house that picking out this one seems ludicrous.
I'm not sure I agree with any of this statement. Few companies dictate pricing to other companies. Everything about this sentence screams collusion.
> I fail to see how this is much different except that it's politically popular.
Everything about everything is political. The laws are political. The justice system is political. The issues the government fights are political. What would politicians do but politics?
> Rental property owners are not forced to use it, and even have the traditional market forces not to use it: undercut the algo prices and get more business.
And yet it's quite popular in certain markets, and has demonstrated raising prices. The problem with this assumption is the housing market isn't a great efficient commodity market. Moving has extremely friction cost, supply isn't elastic, and a supplier can't easily make more housing units to trade margin for volume. Some housing markets are extremely tight and expensive.
This case is basically text book collusion, wrapped up in a politically relevant bow. As other commenters described, this company requires you to collude by forcing you to use their pricing.