While this makes sense, I also see how RealPage likely got caught up and thought this was business insights they were selling as a data aggregator. (Being devil's advocate, I don't know much about their knowledge or ignorance.) Something that is all to common of a business practice these days. If the "here's our number" was whispered back as a "score" instead of a price and the cost was denominated in interest rates instead of dollars, wouldn't it be similar to the credit scores we all have? Is that a form of collusion as you define it?
> I also see how RealPage likely got caught up and thought this was business insights they were selling as a data aggregator
Almost everyone I've met who has ended up in trouble with the law in business got where they are by this exact pattern. When they get caught, it's usually just naked, obvious crime. I've seen:
* Trading fake invoices between subsidiaries to increase top-line revenue leading to fraud charges.
* Fake billing between companies to paper over private use of a business jet.
* Medical billing software where diagnostic codes were optimized by matching the procedure to the highest paying service scenario. i.e. making applying a bandage be a emergency surgery bandage application which would be billed at 9x the price of a normal office visit.
* Lots of startups that started with a forward looking "were' going to build invention x" only to discover two years in that invention x is not possible. Instead of pivoting, the founders double down on invention x to raise more money with a "we're close" or "we are commercializing as we speak" pitch.
* Taking loans against customer owned securities. Behold infinite non-diluting cash, and infinite jail time when caught.
In every case, the pattern was completely ok from the founder's point of view, but when you look at the practice in total it was pretty easy to see crime.
Well, RealPage had a "policing agent" that made sure that RealPage customers were using the RealPage rate, and if not they were kicked out of the cartel.
Businesses doesn't get kicked out by Experian if they grant a loan to someone with a low Experian credit score.
Is it strange to be glad that, in that scenario, that those were the consequences for being a data aggregator? I have a deep cynicism about the work of data brokers and the large flows of data that, in the wrong hands, end up being used for surveillance.
I think it's under-studied how information and markets interact. There was the great "markets are efficient if and only if P=NP" paper. Basically the insight was that prices are information and a market is (supposed to be) a computing mechanism for finding "optimal" transactions. Price discovery is often difficult. It is natural for participants to outsource it to computers. But if all those computer services are run by the same company .. suddenly you have a single agent setting prices, not a market.
> wouldn't it be similar to the credit scores we all have
Wow, have never thought about this. Yes, yes they are similar... That's why I get basically the same interest rates across all financial institutions. There's no competition, basically they're communicating to "price fix" a rate.
Though I doubt America would raid the holy grail of capitalism, financial institutions
Credit scores don’t discourage competition. Competition can still exist within brackets.
The reason rates don’t differ much is because most of the rate is determined by factors outside of the lenders control. There’s a pretty small margin for them to compete on price with each other with. That’s why rates on stuff like mortgages are basically commoditized.
