this post was submitted on 05 Oct 2023

464 points (98.5% liked)

News

23267 readers

4400 users here now

Welcome to the News community!

Rules:

1. Be civil

Attack the argument, not the person. No racism/sexism/bigotry. Good faith argumentation only. This includes accusing another user of being a bot or paid actor. Trolling is uncivil and is grounds for removal and/or a community ban. Do not respond to rule-breaking content; report it and move on.

2. All posts should contain a source (url) that is as reliable and unbiased as possible and must only contain one link.

Obvious right or left wing sources will be removed at the mods discretion. We have an actively updated blocklist, which you can see here: https://lemmy.world/post/2246130 if you feel like any website is missing, contact the mods. Supporting links can be added in comments or posted seperately but not to the post body.

3. No bots, spam or self-promotion.

Only approved bots, which follow the guidelines for bots set by the instance, are allowed.

4. Post titles should be the same as the article used as source.

Posts which titles don’t match the source won’t be removed, but the autoMod will notify you, and if your title misrepresents the original article, the post will be deleted. If the site changed their headline, the bot might still contact you, just ignore it, we won’t delete your post.

5. Only recent news is allowed.

Posts must be news from the most recent 30 days.

6. All posts must be news articles.

No opinion pieces, Listicles, editorials or celebrity gossip is allowed. All posts will be judged on a case-by-case basis.

7. No duplicate posts.

If a source you used was already posted by someone else, the autoMod will leave a message. Please remove your post if the autoMod is correct. If the post that matches your post is very old, we refer you to rule 5.

8. Misinformation is prohibited.

Misinformation / propaganda is strictly prohibited. Any comment or post containing or linking to misinformation will be removed. If you feel that your post has been removed in error, credible sources must be provided.

9. No link shorteners.

The auto mod will contact you if a link shortener is detected, please delete your post if they are right.

10. Don't copy entire article in your post body

For copyright reasons, you are not allowed to copy an entire article into your post body. This is an instance wide rule, that is strictly enforced in this community.

founded 1 year ago

MODERATORS

[email protected]

464

Report: Amazon made $1B with secret algorithm for spiking prices Internet-wide (arstechnica.com)

submitted 1 year ago by [email protected] to c/[email protected]

29 comments fedilink hide all child comments

Last week, the Federal Trade Commission sued Amazon, alleging that the online retailer was illegally maintaining a monopoly. Much of the FTC's complaint against Amazon was redacted, but The Wall Street Journal yesterday revealed key details obscured in the complaint regarding a secret algorithm. The FTC alleged that Amazon once used the algorithm to raise prices across the most popular online shopping destinations.

People familiar with the FTC's allegations in the complaint told the Journal that it all started when Amazon developed an algorithm code-named "Project Nessie." It allegedly works by manipulating rivals' weaker pricing algorithms and locking competitors into higher prices. The controversial algorithm was allegedly used for years and helped Amazon to "improve its profits on items across shopping categories" and "led competitors to raise their prices and charge customers more," the WSJ reported.

you are viewing a single comment's thread
view the rest of the comments

[–] [email protected] 14 points 1 year ago* (last edited 1 year ago) (1 children)

I "love" US companies that increase their profit with illegal and secret algorithms (no effort). Hope for big fines (50%, here we come!)and long lasting bans.

[–] [email protected] 8 points 1 year ago (2 children)

But not only 50% of the additional profit - should be something like at least double or triple that.

[–] [email protected] 9 points 1 year ago (2 children)

It's 'The Formula' from Fight Club:

I was a recall coordinator. My job was to apply the formula.

A new car built by my company leaves somewhere travelling at 60 mph. The rear differential locks up. The car crashes and burns with everyone trapped inside. Now, should we initiate a recall?

Take the number of vehicles in the field, A. Multiply it by the probable rate of failure, B.
Multiply the result by the average out-of-court settlement, C.

A x B x C equals X. If X is less than the cost of a recall, we don't do one.

The key to preventing this kind of thing is to make sure that X is always considerably higher than A x B x C. If monetary penalties are all that are being assessed, they need to be fucking astronomical to the point that no reasonable company would even consider taking the risk of getting caught, no matter how minute that risk is. Until we start operating like that, there's simply no incentive for any of these companies to stop breaking the law.

[–] [email protected] 6 points 1 year ago (1 children)

And start throwing executives in jail.

[–] [email protected] 6 points 1 year ago

This is the real answer

If the penalty for a crime is only a fine, then that crime only exists for the lower class

[–] [email protected] 0 points 1 year ago (1 children)

I am sorry, however you provide some interesting information, this case has noting to do with recalls.

[–] [email protected] 1 points 1 year ago

It's a quote from Fight Club; I know this case has nothing to do with recalls. The point applies to any corporate lawsuit.

Let me re-frame it, if that helps:

Take the number of users, A. Multiply it by the expected per-user profit from price-spiking practices, B. Multiply the result by the chance of not getting caught / fined, C.

A x B x C = X. If X is greater than the expected fine for doing this, we'll do it even though it's illegal.

The point is that the penalty / fine that's assessed needs to far out-weigh the potential benefit, taking into account the chance of getting caught / fined in the first place. If they stand to make $10 million in profit, and the penalty for getting caught is $100 million, but the chance of getting caught is only 5%, their ROI is positive and it's simple numbers - they'll do it every time.

If in the above example the penalty was $1 billion, suddenly the ROI is negative, and they won't do it. It's simply math. By having penalties that are too low to impact their overall profit, they simply don't work as a deterrant.

[–] [email protected] 1 points 1 year ago

A $1.5 Billion fine would work as deterand.

But I am afraid US politics won't allow it.(lobbying)