Of all of the the reason why it may be difficult to pay rent every month, did you could have an algorithm-driven illegal cartel in your list?

Millions of individuals within the United States are paying way more in rent than they will reasonably afford, and rental housing prices are rising much faster than household income. In 2022 there have been 22.4 million US households spend greater than 30% of their income for rent and utilities, up from 20.4 million in 2019.

Many of those households faced significant cost burdens, with 11.6 million households scuffling with housing costs devour greater than half of their income. In Chicago, Cincinnati, Minneapolis, Virginia Beach and Washington, rental prices are year-over-year are increasing at double-digit rates.

Several aspects drive up the high rental costsThese include increasing demand, a dwindling supply of low-rent units, rising capital costs to construct latest rental housing, and regulatory barriers restricting multifamily construction.

But there's one other surprising factor driving up rental prices: landlords using technology to make deals. The USA The Justice Department is suing the corporate RealPage, Inc.and accuses him of selling software to landlords that enables them to jointly set prices – an illegal practice of price fixing. As a former official within the Antitrust Division of the Department of Justice and a Law professorI even have followed the case closely.

The dangers of price fixing

The Federal Trade Commission defines price agreements as an agreement, conspiracy or association between competitors to extend, fix or otherwise maintain the worth at which their goods or services are sold.

Some agreement that restricts price battle violates antitrust law. Examples of price fixing include commitments between competitors to maintain prices fixed, to adopt an ordinary price calculation formula, or to stick to a minimum fee or price list.

So when competitors share proprietary, confidential current pricing information – directly or not directly through an intermediary – to stabilize or control industry prices, that’s what they’re doing crossed the border involved in illegal collusion, in response to the FTC. This is the case in large parts of the US rental market, argues the Justice Department.

One algorithm for everybody

In August 2024, the Department of Justice and eight states filed a lawsuit against RealPage in federal court in North Carolina. The Justice Department accused the corporate of selling software to landlords that collects nonpublic information from competing landlords and uses that combined information to make pricing recommendations.

Landlords who use the software enter the rental prices they charge and the software aggregates all the info from the corporate's customers. The software's algorithm then provides recommendations for the fees to be charged. The recommendations are general higher than the present market priceAnd Most customers accept the recommendationsthat drive up prices in a market.

Even if landlords retain some authority to deviate from the algorithm's recommendations, it is illegitimate for competing landlords to collectively delegate vital elements of their pricing to a standard algorithm. in response to the Justice Department's lawsuit. The Ministry of Justice explained that “RealPage replaces competition with coordination. It substitutes unity for rivalry. It undermines competition and the competitive process. This is happening openly and directly – and American renters are paying the price.”

The case is unusual in that, unlike a typical price-fixing cartel, the landlords used RealPage's algorithms to significantly improve their ability to repair prices. Algorithmic price fixing is usually simpler and more practical than other types of cartel behavior. The software can easily aggregate massive amounts of proprietary data, optimize cartel profits, monitor cartel price deviations in real time, and minimize incentives for fraud.

“It’s much easier to set the worth when you outsource it to an algorithm “As opposed to sharing manila envelopes in a smoke-filled room,” Jonathan Kanter, head of the Justice Department's antitrust division, told The New York Times.

Since 2022, RealPage and various property managers have been named as defendants in greater than a 12 months 30 class motion lawsuits with the accusation that the RealPage software is getting used to unlawfully set rental prices. Federal courts are inclined to be sympathetic to such arguments, as evidenced by the denial of a motion to dismiss the case one in every of the private lawsuits filed against RealPage.

In this case the court held that a There may very well be price agreements for legal reasons. Landlords provided RealPage's algorithmic system with their proprietary business data, knowing that RealPage would demand the identical of its competitors and use all of that data to recommend rental prices to the entire company's customers.

Classic price agreements or data-driven decisions?

Some landlords look like aware that by sharing confidential pricing information with RealPage's software, they’ve facilitated the illegal monitoring and increase of rental prices. The Justice Department's criticism quoted a landlord Comment on RealPage's software: “I've always liked this product because your algorithm uses proprietary data from other subscribers to suggest rents and terms. This is classic price fixing.”

Even RealPage executives have boasted that when landlords share their software, “every possible technique to increase the worth“ says the criticism.

RealPage argued that its software “simply helps landlords make data-driven decisions“in an intensely competitive market. The company claims its tools are designed to reflect market conditions and optimize utilization, not price fixing.

The company describes the impact of its alleged collusion with landlords as “a rising tide [that] raises all ships.” Perhaps a greater description of their ministry could be a rising tide, lifting all ships for many who have one.

The Justice Department case and the private cases are within the early stages of litigation. If the division is successful, RealPage might be prohibited from engaging in anticompetitive practices related to assisting landlords in sharing proprietary pricing information.

Apple is releasing a free software update that offers its iPhone 16 range the primary dose of artificial intelligence because the forward-thinking company tries to maintain up with the most recent technology trend.

The upgrade to the iOS 18 operating system comes Monday, greater than a month after 4 iPhone 16 models equipped with the special computer chip required for the AI ​​features went on sale, priced between $800 and $1,200 trade got here. Last 12 months's premium models – the iPhone 15 Pro and iPhone 15 Pro Max – even have a processor that prompts AI technology after installing the software update.

Current versions of Apple's iPad and Mac computers can be updated with the software.

Countries outside the US won’t receive the AI ​​software for his or her iPhones until next 12 months, at a date to be determined. Apple has spent the last five weeks testing the AI ​​software to an audience of iPhone owners who signed up to assist the corporate fine-tune the technology.

The AI ​​infusion goals to rework Apple's often bumbling virtual assistant Siri right into a chattier, more versatile and colourful companion, whose presence is indicated by a glowing light that circles the iPhone's screen as requests are processed.

While Apple guarantees that Siri will have the option to perform more tasks and be less liable to confusion, it’s going to not have the option to interact with other apps installed on the iPhone until one other software update is released at an as-yet-unspecified date.

Additional AI features included on this software update handle quite a lot of writing and proofreading tasks and summarize the content of emails and other documents. The AI ​​also provides quite a lot of editing tools to alter the looks of photos and make finding old images easier.

Other AI tricks to are available future software updates include the power to quickly create custom emojis or conjure up other imaginative images on demand. Apple also plans to eventually give its AI suite the power to be powered by OpenAI's ChatGPT if users want it.

Most of the AI ​​features Apple introduced on Monday are already available on Android smartphones that Samsung and Google released earlier this 12 months.

To differentiate its approach from early leaders in AI, the iPhone's latest technology suite is being marketed as “Apple Intelligence.” Apple also guarantees that its AI capabilities will much better protect the privacy of iPhone owners, either by running the technology on the device or by housing it in a fortress-like data center when some requests should be handled remotely.

Since most iPhones currently in use all over the world don’t have the pc chip needed for Apple's AI, the technology is anticipated to drive huge demand for the brand new models through the holiday season and into next 12 months. That's the major reason Apple's stock price has risen 18% since Cupertino, Calif., previewed its AI strategy at a conference in early June. The ramp-up has added about $500 billion to Apple's market value and brought the corporate closer to becoming the primary U.S. company to be valued at $4 trillion.

Apple will give investors a primary take a look at the event of the iPhone 16 on Thursday when the corporate releases quarterly financial information for the July-September quarter – a period that features the primary few days the brand new models went on sale.

Demand for the higher-end iPhone 15 models rose as prices for them fell and excitement grew over Apple's entry into the AI ​​market, in keeping with an assessment of the smartphone market last quarter by market research firm International Data Corp.

According to IDC, Apple's iPhone shipments worldwide rose 3.5 percent to 56 million within the July-September period in comparison with the identical period last 12 months, surpassing only Samsung. The query now is whether or not Apple's gradual release of more AI will cause owners of older iPhones to speculate in the brand new models through the holidays and “future-proof their purchases in the long term,” said IDC analyst Nabila Popal.

Originally published: October 28, 2024 at 8:10 am PDT

With home affordability within the Bay Area already spiraling uncontrolled, a federal court antitrust lawsuit against a property management software company has prompted San Jose officials to think about ways to guard renters from unfair pricing strategies.

City Council members Peter Ortiz, Omar Torres and David Cohen have proposed an ordinance that will ban rent or occupancy rate setting tools like RealPage, which the Justice Department accused of allegedly allowing landlords to collude on rent prices.

“Artificial intelligence should be a tool for innovation and progress, not for monopolistic practices that drive up housing costs,” Ortiz said.

In the antitrust lawsuit, filed jointly with the attorneys general of several states, including California, the software company is accused of allowing landlords to share competition data, giving them the chance to regulate their rents and make higher profits.

The government's lawsuit quotes a RealPage executive as saying, “It's better for everyone to succeed than for us to try to essentially compete with each other in a way that puts the entire industry under pressure.”

It also quotes a landlord who has used the software as saying: “I always liked this product because your algorithm uses proprietary data from other subscribers to suggest rents and terms. This is classic price fixing…”

Scrutiny of property management software firms like RealPage began in 2022 after news outlet ProPublica conducted investigations into the corporate and the way its algorithm works, resulting in a flood of lawsuits, including against major multifamily developers and municipalities.

Before the antitrust lawsuit, RealPage denied any wrongdoing. In its defense, the corporate said landlords had control over whether to simply accept or reject rental recommendations and had 100% control over the rent amount.

As the case plays out in federal court, local politicians like Ortiz, Torres and Cohen said they felt compelled to act because the Bay Area's affordability crisis worsened.

“Dynamic pricing tools like RealPage are growing in popularity across the economy, providing market participants with the ability to maximize profits despite being cloaked in an inflationary environment,” a memo from the three council members said. “In the housing market, algorithmic rent setting has led to double-digit rent increases, more evictions, and worsened the city's housing shortage and homelessness crisis.”

Data from real estate analytics firm CoStar showed that the typical rent in Santa Clara County has increased 21% over the past nine years, to $2,990.

If San Jose were to enact a neighborhood ban of some sort, it could follow the instance of San Francisco, which passed an analogous ordinance last month to guard residents and lower rents, said Huascar Castro, housing and transportation director for Working Partnerships USA.

“There is a lot of irrefutable data showing that the share of housing stock owned by corporations is directly related to the effects of displacement,” Castro said. “This tool has been used to further exacerbate those effects and is being investigated as a form of price fixing.”

The interim regulation would allow the state attorney general and tenants to file civil lawsuits against landlords caught using the software – even though it doesn’t specify how they’d be caught – and will end in fines of as much as $1,000 per violation.

But before an ordinance is even considered, there’ll likely be questions and resistance about how town plans to implement it.

Anil Babbar, vp of local affairs for the California Apartment Association, said local officials mustn’t be responsible if a case is pending in federal court, fearing that property owners would need to bear the prices of enforcement.

“We don't have any data that shows or proves the occupancy rate in the city, so we don't know how big the problem is or what problem we're trying to solve,” he said.

Originally published: September 5, 2024 at 1:14 pm

Foreclosure Executives told investors that the variety of deals was declining or delayed. Dell said its margins were shrinking. Octa highlighted macroeconomic challenges. And Veeva's The CEO said at his company's earnings call that generative artificial intelligence is “a competing priority” for purchasers.

All in all, it was a brutal week for software and enterprise technology.

Salesforce shares plunged nearly 20% on Thursday, the most important drop since 2004, after the cloud software provider reported weaker-than-expected revenue and issued disappointing guidance. CEO Marc Benioff said Salesforce grew quickly within the age of Covid as firms rushed to purchase products for distant work. Then customers needed to integrate and eventually streamline all the brand new technology.

“Every enterprise software company has adapted in some way since the pandemic,” Benioff said on his company's quarterly earnings call. The firms which have reported results recently “are all basically saying the same thing, just in different ways.”

Software manufacturer MongoDB, SentinelOne, UiPath and Veeva all cut their full-year revenue forecasts this week.

The WisdomTree Cloud Computing Fund, an exchange-traded fund that tracks cloud stocks, lost 5% this week, its biggest decline since January. Paycom, GitLab, Converging, Snowflake And service now all lost a minimum of 10% of their value within the downward trend.

Dellwhich sells PCs and data center hardware to enterprises, raised its full-year forecast on Thursday, saying its backlog for AI servers grew to $3.8 billion from $2.9 billion three months ago. However, the growing share of those servers within the product mix, in addition to higher input costs, will cause the corporate's gross margin to say no 150 basis points over the 12 months.

Dell shares fell 13% for the week after hitting latest highs. The company is seen as a beneficiary of the generative AI wave as firms increase their hardware purchases. Expectations are “elevated,” Barclays analysts wrote in an earnings note.

Okta's share price fell nearly 9% for the week, with analysts citing a weaker-than-expected backlog. The company said economic conditions were hurting the identity software maker's ability to draw latest customers and get existing ones to purchase more.

“There are still macroeconomic headwinds,” Okta CFO Brett Tighe said throughout the company’s quarterly earnings conference call.

An inflation index this week was barely higher than expected. The US central bankers are keeping the important thing rate of interest, which has been at a high level for 23 years, unchanged.

At UiPath, a developer of automation software, the pace of business slowed in late March and April, partly resulting from the economy, co-founder Daniel Dines told analysts on Wednesday. Customers even have grow to be increasingly reluctant to commit to multi-year contracts, said Dines, who will replace former Google executive Rob Enslin as CEO on June 1, just months after stepping down as co-CEO.

Cybersecurity software provider SentinelOne is observing an analogous trend.

“There's no doubt that buying habits are changing,” SentinelOne CEO Tomer Weingarten told CNBC on Friday, adding that the best way “customers evaluate software” can also be changing. His company's stock price plunged 22% within the week after forecasts got here in below estimates.

Added to this are the impacts of AI, that are causing firms to re-prioritize.

Veeva CEO Peter Gassner spoke of “disruptions in large companies implementing their plans for AI.” Veeva, which sells life sciences software, lost nearly 15% of its value this week on concerns about spending within the second half of the 12 months.

Gassner said on the conference call that generative AI is “a competing priority” for Veeva’s customers.

The news wasn't all bad. ZscalerShares rose 8.5% on Friday after the safety software provider beat expectations for the quarter and raised its full-year forecast.

“We expect demand to remain strong as more companies plan to adopt our platform for better cyber and data protection,” CEO Jay Chaudhry said on the corporate's quarterly earnings call.

REGARD: The returns are good, however the software must work higher, says Mike Bailey of FBB Capital

SUNNYVALE — Google has outlined plans to chop dozens of jobs within the Bay Area, a troubling reminder that the wave of layoffs within the tech sector is probably not quite over yet.

The search giant has decided to chop 50 positions in Sunnyvale, in accordance with a report filed with the state Department of Employment Development.

The layoffs will occur at three Google offices on Crossman Avenue, in accordance with the WARN notice.

Mountain View-based Google told the state EDD that layoffs were scheduled for June 15 and 23.

“The separations resulting from this action are expected to be permanent,” Lindsey MacLean, vice chairman of Googler Experience, said within the WARN letter to the state unemployment agency.

The affected employees have all been informed of their impending job loss, Google reported to the EDD. Everyone gave at the least 60 days notice, the tech titan explained.

A review of the WARN letter shows that the overwhelming majority of job cuts affect Google software, data and program engineers, each rank-and-file and management.

With the newest layoff news, Google has announced plans to chop greater than 2,500 jobs within the Bay Area, in accordance with this news organization's review of the corporate's WARN notices.

“Affected employees will continue to receive all wages and benefits to which they are entitled as Google employees until their employment is terminated,” Google’s WARN letter states.

More senior employees who lose their jobs don’t have any right to oust or replace lower-senior employees, Google told the EDD.

“None of the affected employees at the (Crossman Avenue) facilities (in Sunnyvale) are represented by a union,” Google stated within the WARN letter.