The law sounds good, but without knowing much about it, my first thought is, how is this enforceable? And will it really matter? Sellers want the highest prices people are willing to pay. They will make a mathematical calculation that includes profits from higher prices and losses from not completing the sale because the price is too high for some people. People who can't afford it will go without and people who can pay more will make up the difference. This isn't good for the consumer whether it is technically price fixing or not. Software that makes determining that most profitable price will hurt people regardless of whether or not the software communicated with other vendors in determining their most profitable price. People seeking the best deals, as well as available supply, will tend to determine that most profitable price that vendors will arrive at. The software just needs to look at sales patterns and adjust prices accordingly - sometimes even using a different price depending on the time of day, day of the week, age or sex of the individual, etc. It's not just targeted advertising, but also targeted price adjusting, not quite the same as price fixing but just as bad.
That said, there are benefits to automation that may lower prices for everyone, such as automatic record keeping. The biggest threat may be monopolies wiping out competition, not automation, but automation can make both the good and the bad more efficient at whatever they are doing.
Props to CA for sure. But I agree with Brian, this post has a distortion that should be corrected.
I read the McKinsey article linked, and skimmed the 66 page report, and it discusses their research on generative AI's productivity benefits, estimating $2.6-4.4 trillion in value creation through customer service improvements, marketing content generation, and software development assistance. These benefits are about productivity gains and value creation, not profits earned from pricing manipulation or additional costs to consumers. The study doesn't mention rental housing or pricing algorithms or put a price tag on such potential harms at all.
Good work in California! But the claim "a McKinsey study estimated that corporations could juice consumers for an additional $4.4 trillion every year with AI based pricing tools" should have raised red flags; that's 1,158 times the $3.8 billion in rent gouging. Turns out it's total nonsense, according to your source. The report says absolutely nothing about AI pricing tools; the $4.4T is the high end of the global gains businesses might see from productivity increases by using AI.
The corporate model, when used responsibly, is a great way to consolidate money for a public good. Corporate charters originally were created for public works projects. Later, after much angry consternation, they were given free reign with which anyone could play.
We learned corporations:
Use the legal system to shirk public responsibility in its myriad forms;
Defeat most labor initiatives;
Bleed money from one locale and redirect it to another;
Almost always devolve into a monpoly situation;
Distort politlcs;
Create an investor antagonist with opposing incentives: Example, utilities owned by investors who don’t use that service and live well outside that service area …
We need to rethink the very definition of “corporate charter” and bring the boom down on malefactors.
"It updates California’s more than century-old antitrust law, to make clear that using algorithms to coerce or restrict the ability of independent businesses to set their own prices competitors’ ability to set prices through algorithms or platform rules is in fact illegal price fixing"
I'm afraid I don't understand whatever this description of the update is. Can someone clarify?
Q - Why did you choose to write such a political novel, and has your work in activism influenced your fiction?
A - Today we live in a world that is hermetically corporatized and monopolized, a world with close to zero choice and a world that is only growing darker. As my novel is about a group of fed-up activists that starts assassinating billionaires in order to draw attention to the misery and death their corporatization and monopolization inflicts upon humanity, yes, I would say my career in activism influences my fiction. And if a comic novel about a billionaire hit list brings attention to the wealth disparity crisis, this real life holocaust of which billionaires are the grinning poster boys, then I will have achieved my goal.
The law sounds good, but without knowing much about it, my first thought is, how is this enforceable? And will it really matter? Sellers want the highest prices people are willing to pay. They will make a mathematical calculation that includes profits from higher prices and losses from not completing the sale because the price is too high for some people. People who can't afford it will go without and people who can pay more will make up the difference. This isn't good for the consumer whether it is technically price fixing or not. Software that makes determining that most profitable price will hurt people regardless of whether or not the software communicated with other vendors in determining their most profitable price. People seeking the best deals, as well as available supply, will tend to determine that most profitable price that vendors will arrive at. The software just needs to look at sales patterns and adjust prices accordingly - sometimes even using a different price depending on the time of day, day of the week, age or sex of the individual, etc. It's not just targeted advertising, but also targeted price adjusting, not quite the same as price fixing but just as bad.
That said, there are benefits to automation that may lower prices for everyone, such as automatic record keeping. The biggest threat may be monopolies wiping out competition, not automation, but automation can make both the good and the bad more efficient at whatever they are doing.
Props to CA for sure. But I agree with Brian, this post has a distortion that should be corrected.
I read the McKinsey article linked, and skimmed the 66 page report, and it discusses their research on generative AI's productivity benefits, estimating $2.6-4.4 trillion in value creation through customer service improvements, marketing content generation, and software development assistance. These benefits are about productivity gains and value creation, not profits earned from pricing manipulation or additional costs to consumers. The study doesn't mention rental housing or pricing algorithms or put a price tag on such potential harms at all.
Good work in California! But the claim "a McKinsey study estimated that corporations could juice consumers for an additional $4.4 trillion every year with AI based pricing tools" should have raised red flags; that's 1,158 times the $3.8 billion in rent gouging. Turns out it's total nonsense, according to your source. The report says absolutely nothing about AI pricing tools; the $4.4T is the high end of the global gains businesses might see from productivity increases by using AI.
The corporate model, when used responsibly, is a great way to consolidate money for a public good. Corporate charters originally were created for public works projects. Later, after much angry consternation, they were given free reign with which anyone could play.
We learned corporations:
Use the legal system to shirk public responsibility in its myriad forms;
Defeat most labor initiatives;
Bleed money from one locale and redirect it to another;
Almost always devolve into a monpoly situation;
Distort politlcs;
Create an investor antagonist with opposing incentives: Example, utilities owned by investors who don’t use that service and live well outside that service area …
We need to rethink the very definition of “corporate charter” and bring the boom down on malefactors.
"It updates California’s more than century-old antitrust law, to make clear that using algorithms to coerce or restrict the ability of independent businesses to set their own prices competitors’ ability to set prices through algorithms or platform rules is in fact illegal price fixing"
I'm afraid I don't understand whatever this description of the update is. Can someone clarify?
Q - Why did you choose to write such a political novel, and has your work in activism influenced your fiction?
A - Today we live in a world that is hermetically corporatized and monopolized, a world with close to zero choice and a world that is only growing darker. As my novel is about a group of fed-up activists that starts assassinating billionaires in order to draw attention to the misery and death their corporatization and monopolization inflicts upon humanity, yes, I would say my career in activism influences my fiction. And if a comic novel about a billionaire hit list brings attention to the wealth disparity crisis, this real life holocaust of which billionaires are the grinning poster boys, then I will have achieved my goal.
https://link.sbstck.com/redirect/1ecff596-cb63-4df9-a52f-e896193313fd?j=eyJ1IjoiNmFleGR1In0.xGgraWYPZgZXOoTlHnBmf0WXRCMQ6rJKHwQv5Hmx7N0