back to article Google snags patent on price discrimination

You might think that the biggest brains in the USA could be put to work curing cancer, but the Chocolate Factory has bigger fish to fry: how to mine what it knows about users to “customize” content pricing. Not content with the more general practice of slugging users based on geography, Google wants the ultimate in granular …

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  1. Anonymous Coward
    Anonymous Coward

    This is evil

    My mum (58 and not sure what a folder is) suggested this would happen as tracking got better and I laughed it off as paranoia. Clearly she knows more about the ways of the net and the Google than me.

    1. LarsG
      Meh

      I could have sworn

      I could have sworn that this goes on already.

      For instance, the number of times I have looked at the price of flights, thought that I have found a good deal, looked a bit more, then gone back to the flight I originally decided on and found the price had gone up.

      On Amazon, I find something I might like to buy, decide not to but then go back the following day and find the price has gone up.

      Now if I find a reasonable deal, I leave that window open then go back to it.

      1. toadwarrior

        Re: I could have sworn

        It does. There were loads of stories about tickets flights being more expensive if you shop with a mac and either I get really lucky if I shop around or amazon does adjust prices which has recently resulted in an SSD purchase.

        It's an old tactic and not really patent worthy and in fact I doubt google's implementation works. Had they applied this algorithm to chromebooks they'd have known not to sell them at all.

        1. JDX Gold badge

          There were loads of stories about tickets flights being more expensive if you shop with a mac

          The recent story was about hotel bookings and it did NOT say they charged more for Mac users. It said Mac users were shown more expensive rooms first - the same rooms were available at the same prices to all but Mac users were shown the more expensive ones first.

          As for the "plane flights go up in price" thing, well plane tickets DO go up in price nearer the time don't they? Are we talking about using the provider's site directly, or using sites like Kayak which won't tell each airline your cookies?

      2. Nick Ryan Silver badge

        Re: I could have sworn

        FLIGHTS - the trick (apparently) is to clear all the site (domain) cookies and go back in, otherwise every time you revisit the page the utter bar stewards up the price. If you're not up to this, then use Private Browsing mode to search for flights and compare and then close this mode, go back in and select the flight you want.

      3. Anonymous Coward
        Anonymous Coward

        Re: I could have sworn

        "For instance, the number of times I have looked at the price of flights, thought that I have found a good deal, looked a bit more, then gone back to the flight I originally decided on and found the price had gone up."

        Think there's a simpler explanation for this ... you go to flight booking system and ask for price of ticket - system responds and puts a hold on that ticket for a period of time to allow you to go through the purchase process ... as has been evidenced by the London Olympic ticket system people don't like systems where you get quoted a price for a ticket, go through the process of getting to check out and then being told that the ticket is no longer available! Then if you do a bit more research and come back to the original site and ask for a ticket price again the are fewer available seats (as one or more are being held from your first request) thus the normal airline pricing system kicks-in and quotes you a higher price for the now scarcer resource.

      4. This post has been deleted by its author

      5. CJM
        Happy

        Re: I could have sworn

        Ryannair and others do this... Check out a flight, come back later and it has gone up. Solution: zap your cookies and try again and you'll be back to the original price...

    2. Da Weezil
      Stop

      Re: This is evil

      Maybe the older generations are much more cynical about the motives of any megacorp... after all they have a lifetime of being stiffed by cartel behaviour and other dubious/sharp practices that seems to be more and more a required part of business now.

      1. LightningKid

        Re: This is evil

        Well, you kiddies tend to get buttfvkked and not even realize it, so...

    3. Anonymous Coward
      Anonymous Coward

      Re: This is evil

      First of all - lots of prior art here.

      1. Amazon already tried it based on your shopping habits. They got flamed into a crisp and repented initially. This did not last. They now run optimized pricing, just not the personalized variety with the price for items in demand rizing very fast as they are purchased. A good example here is the bargain basement price for Whitney Houston records rocketing several hundred percent automatically as a result of purchases after her death.

      2. Airlines, hotels and even car rentals have been doing this for a very long time. You feed a lot of numbers in a number-cruncher, the number cruncher computes a classic optimal control problem off them with revenue maximization being the goal. Out of the other side comes a price-du-jour. Depending on algo, method of computation, etc it is run on anything from real-time to once daily.

      The only thing which Google has done here is to blatantly copy Amazon's old idea (which has been Stelyos and O'Leary operating model for years prior to that), put digital in the wording and voila. Here you have a novel patent.

      By the way the examiner who failed to find the blatantly obvious prior art on this should be given a pink slip straight away.

      Evil it may be, but that is capitalizm for you - maximise profit (or in first approximation revenue) is the ultimate goal of any company.

      1. GavinC

        Re: This is evil

        @AC: this patent is different to what airlines are doing. In the example of an airline, they will increase the fare based on demand for that flight. As more people book, the fare increases. (well, it's a bit more complicated than that) . the Whitney album pricing is the same - it is based on demand for the item.

        What Google has patented, is adjusting the price based on how likely the current visitor is to buy it.

        The difference being if you and me both go to book a flight, we will both see the same price, as it is based on demand for the flight. But if we both go to buy something through google, we will see two different prices based on how more likely you are to buy it compared to me. (being based in Scotland you can guarantee I am considered less likely to part with my cash!). therefore they are adjusting the price based on likelyhood of you buying, not based on (overall) demand for the item.

        For a while Easyjet used to store a cookie on your machine which saved the details of any flights that you had looked at, and inflated the price if you looked at the same thing twice. This may be considered prior art I guess, but I'm sure the lawyers will word in such a way to make it sound different. I believe this practice is no longer in operation though, at least with easyjet.

      2. h4rm0ny

        Re: This is evil

        "By the way the examiner who failed to find the blatantly obvious prior art on this should be given a pink slip straight away."

        Absolutely. Not only is there prior art for this (we could also include Monty Python's Life of Brian which I seem to recall involved a detailed illustration of this process and a gourd), but having just skim-read the patent, there's no actual methodolgy in this at all.

        If Google had conducted research and concluded that if visitor x comes back to an item in the store more than 4 times a month, they have a 98% chance of purchasing, if they look at similar items in a range X% above and y% below the items cost, then the chance of them buying at base price + 1/3% is only 1% lower than the chance of them buying it at base price so put the price up... that sort of methodology and actual research, then I could see at least that they would have done some work that they might want to protect.

        But the only innovation I can see here is the creativity needed to spin the definition of 'haggle' out to 24 pages.

    4. RegGuy1
      Coat

      Re: This is evil

      Folder? No wonder she doesn't know what one is -- it's a directory (and always will be).

      Now where did I put my directory...?

      1. mark 63 Silver badge

        Re: This is evil

        much as I love being old school, and i was using "directories" before windows even existed ,

        I am warming to "Folder" - it is a hell of a lot more descriptive, i mean what the hell is a directory? well its a list, hence the dir or ls commands - its not the thing holding the files

        i know , you just dont wanna sound like a newb - but sometimes you gotta go with it

        1. VinceH Silver badge
          Facepalm

          Re: This is evil

          "much as I love being old school, and i was using "directories" before windows even existed ,

          I am warming to "Folder" - it is a hell of a lot more descriptive,"

          And, of course, what is the icon used to represent them in most WIMP environments?

          A BLOODY FOLDER!

          Anyone who complains about people calling them folders, when that's exactly what most people see on screen, needs a good kicking.

        2. A J Stiles

          Re: This is evil

          If you grew up round the Amiga, directories are "drawers". And dialogue boxes are "requesters".

          Anyway, aren't there laws against this sort of thing? How is it legal to sell the same product or services to different people at different prices?

          1. Steve Renouf
            Boffin

            Re: This is evil

            "How is it legal to sell the same product or services to different people at different prices?"

            Because there is no contract until both parties agree to the price/goods being offered. I offer an item to you at a price - you agree - I confirm = contract. I offer an item to you at a price - you don't agree - = no contract (or maybe you make a counter offer which I agree to = contract).

            I am free to sell/not sell to whomsoever I please at whatever price we agree. There is no such thing as a price cast in stone!

        3. Anonymous Coward
          Anonymous Coward

          @mark 63 - Re: This is evil

          Windows did that to you!

          A folder does not hold the files, it is a directory telling you where to get your files. It's just because Microsoft couldn't figure out an icon to represent a directory.

      2. dajames Silver badge
        Headmaster

        Re: This is evil

        Folder? No wonder she doesn't know what one is -- it's a directory (and always will be).

        I think there is a subtlety here that you are missing.

        A directory (in one sense, at least) is a level of organization of a hierarchical filesystem; it is a special kind of entity that can contain files and other directories.

        A folder is a GUI abstraction for a container. It can be used to represent objects that can contain other objects of the same or different types. In many widget sets it is portrayed by a sketch of a cardboard folder.

        When discussing the view of a filesystem shown by typical file manager applications the terms become more-or-less interchangeable -- a folder is used in the GUI to represent a directory of the filesystem -- but in more technical contexts (e.g.when discussing how to write such an application) it may be necessary to make a distinction between them.

        1. Anonymous Coward
          Anonymous Coward

          @dajames - Re: This is evil

          You're pretty close. Except for the fact that a directory does not contains files or directories, it contains directory entries for files and/or directories. I could have mentioned metadata but I wanted to avoid increasing the stress level of the discussion.

    5. h4rm0ny

      Re: This is evil

      Age doesn't tell you what technology can do, but it does tell you what people will do with it.

  2. dssf

    Each according to his/needs, each according to his/own abilities? Or...

    Each according to his/ desperation and definitely based on sniffing the TARGET's shopping history via paid-off, umm, "partnered" banks, card issuers, AND by sniffing the TARGET's disclosures in email and social sites?

    Sucker factor will likely increase pucker factor.

    Yes, i am standing by for the frackin down-thumber schills

    1. h4rm0ny

      Re: Each according to his/needs, each according to his/own abilities? Or...

      "Yes, i am standing by for the frackin down-thumber schills"

      Schills (sic) ? You think TARGET is paying people to downvote critics on El Reg forums? I think you overestimate the effect of your comment on their shareprice.

  3. Anonymous Coward
    Anonymous Coward

    That is why we use a clean browser for purchases

    Or we madly start clicking on lots of things we don't want before purchasing.

    1. DutchP
      Joke

      Re: That is why we use a clean browser for purchases

      Can't have that sort of behaviour, now can we? There has to be a patent to detect this and charge you extra for it.

      Obviously you have a right to to this kind of independent, think-for-yourself, anti-social deviant behaviour but it's gonna cost you

      1. g e
        Facepalm

        Re: That is why we use a clean browser for purchases

        Except you'll have logged into Google Wallet or whatever to pay thus accessing a bunch of historical data you don't have the ability to delete...

        1. Steve Renouf
          Alert

          Re: That is why we use a clean browser for purchases

          "Except you'll have logged into Google Wallet..."

          Nah... I don't use a wallet - I just shove everything in my pocket!

  4. Eddy Ito Silver badge
    Devil

    LOL

    Time to roll out the patent for the algorithm that cons this one into dropping the price to near nothing. Now that is something that people would buy.

    Seriously, we need a Dr. Evil icon but this one will do for now.

    1. Grikath
      Black Helicopters

      Re: LOL

      Nah, within a week after such a pricing system goes live there will be scripts to do exactly that..

      Then another week for the use of such scripts to get criminalised by an emergency law.

      1. Field Marshal Von Krakenfart
        Devil

        Re: LOL

        Whadamean an emergency law? They'll site the DMCA because you are "circumventing an access control"

  5. Frumious Bandersnatch Silver badge

    prior art

    Haven't Amazon been outed as doing this for a while? And in this august organ, no less...

    http://www.theregister.co.uk/2000/09/06/amazon_makes_regular_customers_pay/

    No-one comes out smelling of roses (surely it's all relative, but Einstein was the last great patent clerk).

    1. Giles Jones Gold badge

      Re: prior art

      Not to mention that the browser agent string was used to provide different loan quotes. With Firefox users losing out.

      http://news.slashdot.org/story/10/11/04/132257/do-firefox-users-pay-more-for-car-loans

      But why would anyone be surprised at Google for trying this? they try to appear nice and as if they're giving you stuff for nothing while making lots behind the scenes.

  6. James Anderson Silver badge

    market stalls violate google patent?

    Does this mean all my local market stalls will have to close up, or, will they be able to cite Dell Boy as prior art.

    1. David Pollard

      Re: market stalls violate google patent?

      'dunno about Dell boy and market stalls, they might be aiming for a royalty on stock markets and financial transactions.

      1. h4rm0ny

        Re: market stalls violate google patent?

        Nah - stock market works the other way round. Big players with the most money get charged less than others.

  7. Killraven

    Everything old is new again...

    ...at least according to patent filers and their lawyers.

    This is seriously ancient marketing practice. That it should be considered deserving of a patent simply because it's been turned into a computerized/automated format is mind-boggling and just further illustrates the utter ridiculousness of software patents.

  8. Fred Flintstone Gold badge

    Isn't this the umbrella law?

    AFAIK, there is heaps of prior art here, the simplest one is the price of umbrellas going up when it rains.

    Can something this obvious really be patented?

    1. GavinC

      Re: Isn't this the umbrella law?

      Your example is flawed - prices for umbrellas increase when it rains because demand for umbrellas increases. Everyone is still paying the same (inflated) price for them.

      A better analogy would be charging someone without a coat more for an umbrella, as they are more likely to need it than someone wearing a raincoat.

      The key here is that google are offering different prices to each user, not increasing price based on demand. I'm pretty sure there is plenty of prior art, but this example is not one of them and misses the point of the patent application.

  9. Rogan Paneer

    Use a bot?

    One possible measure is to use a price comparison bot- Shopbot, Getprice etc as a starting point for your search. Any price discrimination software worth its salt should be able to respond by offering a really attractive price ...

    1. g e
      Thumb Up

      Re: Use a bot?

      Or the fact you arrived at the store from a pricebot should indicate you're not an easy sell and warrant a lower price automagically :o)

      1. h4rm0ny

        Re: Use a bot?

        That poses an interesting problem for them. They have to keep the prices low for shopbot visitors because otherwise they wont even come to your site in the first place.

      2. Anonymous Coward
        Anonymous Coward

        Re: Use a bot?

        "Or the fact you arrived at the store from a pricebot should indicate you're not an easy sell and warrant a lower price automagically :o)"

        But the majority are an easy sell! Most are sucked in by the advertising/marketing because they are weak of mind. How do you think idiotphone does so well? Create a buzz and a false expectation that your product imbuse a fantastical status and watch them Q out the door like mindless drones.

        You know what they say about a fool and his money!

  10. Richard Wharram

    What's new?

    Insurance companies have been using customer data to work out what they think they can get away with charging for years. What's different about this?

  11. Walter McCann

    Another stupid patent - when will America learn...

    Not another stupid patent.....

    Ryanair and others all ready do this, as the previous poster says, you look up a flight, shop around and come back - the price goes up just enough to "frighten" you.

    Now delete your cookies, change you ip address and look again - oh its a miracle, the price is back down at the original price - weird eh....

    The guy who put in my gutters has used this for years, on the same day he got between €650 and €2,000 per house from about 5 houses on my road (houses identical) - I got the €650 as I was not interested - so maybe he should get the patent,sue google and retire rich :)

    W.

  12. mIRCat

    I believe Apple has prior art on separating fools from their money.

  13. Graham 32

    repurchase the particular item of electronic content

    I suspect this is limited to things like online film rentals because the patent only covers "repurchase the particular item of electronic content." ie you renew the film before, perhaps gave it a good review, so you're likely to rent it again.

    But as there is plenty of prior art on personalised pricing I can't see how it's novel to apply it to repurchases or to electronic content. Their algorithm might be novel, but the concept is not.

    1. Anonymous Coward
      Anonymous Coward

      Re: repurchase the particular item of electronic content

      So hopefully their algorithms will work out I don't rent media, and give it all to me for free?

  14. Delbert
    Pirate

    Google gazumping

    So the answer would seem to be a piece of software to block google tracking totally and since there is a disclosure requirement about cookies lets get busy I wanna be a refusenik

    1. h4rm0ny

      Re: Google gazumping

      I'd be interested in any tools for blocking Google tracking. If you block Google Analytics then about a third of the sites I visit (including the W3schools when I need to come to the surface for a bit of web-work from my databases) will break. They just hang because they're waiting for Google Analytics to respond. What's the solution to this? Just redirect Google Analytics to a local 404 or something? Or are there plugins available to deal with this problem?

    2. Steve Renouf
      Black Helicopters

      Re: Google gazumping

      You mean you aren't already using NoScript and AdBlock?!?

  15. P Saunders
    Happy

    The secret to low prices

    dislike everything.

  16. Andrew Stubbs
    Pint

    There's nothing new under the sun. Historically, a merchant would sell an item based on what it was worth to the buyer, and outside of the grocery store this is basically still the case - an item (or service, whatever) is only worth as much as somebody is prepared to pay for it. It's also still basically de rigueur in developing markets. Dynamic pricing basically predates the fixed price market, but perhaps they have come up with some clever non-obvious way of implementing it. Sure, it's exploitative by its very design - so take your money elsewhere. The merits of the patent application are actually small beer though; I think we've been here often enough to expect that it will be awarded regardless, haven't we?

  17. Mike Judge
    Stop

    Shop with a mac? Too stupid to shop around.

    That's basically how many algorythms work. If you are shopping with an Apple product, then you will be paying more for the same item as PC owners, as clearly you are a total dipshit.

    http://news.cnet.com/8301-1023_3-57460254-93/mac-users-pay-more-than-pc-users-says-orbitz/

    Not only did they pay over the odds for the shiny status symbol itself, they pay over the odds for everything else as a result.

    I call it the idiot tax.

  18. Graham Marsden
    Facepalm

    Prior art...

    So how does this ultimately differ from all those sofa shops and double glazing salesmen who offer you phony "discounts" (translation: just cutting their profit margins a bit) if you're wavering and they want to nail the sale??

    1. RegGuy1

      Re: Prior art...

      Or more to the point, how come so many sofas can be sold at "less than half price"? Doesn't this mean they are *really* overpriced before you start?

      And then they try to flog you the 'insurance and care' packages afterwards.

  19. Schultz
    Stop

    The hidden cost of flexible prices

    The economists tell us about the opportunity cost of inflexible pricing (you might have bought at a lower price, giving the manufacturer a small extra profit that he now forgos). Google's concept could reduce the opportunity cost.

    But there is a hidden cost for society that is ignored: Resources are wasted by the seller to create complex pricing models and more resources are wasted by the buyer to game the system for lower prices. To but it bluntly: you get payed for shopping around (via a lower price), but you do not produce anything during that time.

    Complexity has its own cost. I wonder if any economist would care to quantify that?

    1. A J Stiles
      Thumb Up

      Re: The hidden cost of flexible prices

      At last, someone gets it!

      The Penny Post was created after someone did the maths and worked out that charging a "fair" price based on distance would actually add more to the cost of sending an item, when allowing for the work done deciding what was a fair price, dealing with over- and under-payments and all that sort of stuff, than the actual cost of delivering the item.

      In other words, a flat rate saves on administrative costs.

  20. Badvok
    FAIL

    RTFP

    As usual the Reg Hack gets it wrong!

    The patent is about REpurchases based on how much of your existing time-expired purchase you have already watched/listened to.

  21. mark 63 Silver badge
    Meh

    ERE! Thie Guy wont haggle!

  22. Hagglefoot
    Devil

    foor in the door marketing

    Cant wait for the spiv-bot that follows you from page to page enticing you with that one off, free range, special offer at a price held for this day only because its you type marketing.

    The 'older generation' are right to be skeptical as its just old practices using new tech.

  23. Wang N Staines
    Happy

    They got a patent on supply & demand?

    1. Anonymous Coward
      Anonymous Coward

      No

      Apple got that one...

  24. Nuke
    Facepalm

    Old as the Hills

    "El Reg notes that while the patent is new, the idea has been floating around the Google hive mind for some time"

    The idea is as old as bartering itself. Any entrepreneur is likely to do that, and always has.

    For example, my wife's boss, who sells specialised stuff in an industrial estate (ie not a high street business) looks out the window as a customer arrives to see how expensive their car is, and bases his price on that, their clothes, accent, general bearing and naiveity. He also has a little chat with them first to weigh them up.

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