The Price is (not) Right: RealPage claims to be a tool used to set profitable prices for real estate properties, but the lawsuits against the company accuse it of using AI to enable price-fixing, an issue that, according to the Atlantic, is ripping through an increasing number of industries, and which existing laws don’t have the power to stop.

Price-fixing is highly illegal. The practice traditionally involves executives from different companies in the same industry — even rivals — cooperating to inflate their prices. Lawmakers call this system a corruption of the freemarket economy, punishable by a maximum of ten years in prison as well as a USD 100 mn fine.

How does AI factor into this? The property management software provides a loophole by letting the algorithm do the dirty work for them. If one landlord raises their prices, the AI will raise the average price for all landlords. If enough of them do so, the prices will inflate without industry players having to collude directly.

Lawsuits against RealPage claim that the landlords are willing collaborators, evidenced in their sharing of sensitive information related to their properties, which, according to former antitrust attorney Maurice Stucke at the US Department of Justice, they “typically go to great lengths to protect.” This is atypical behavior in the industry, supporting the accusation that the software clients are willingly encouraging this breach of etiquette.

Abide or be gone. Other lawsuits claim that the platform pressures those who initially refuse to participate into complying with pricing suggestions. Former employees claim that clients are threatened with being kicked off the platform should they reject pricing suggestions. “Enforced compliance is [a] hallmark feature of any cartel,” said Lee Hepner, antitrust lawyer at an anti-monopoly organization.

A dangerous precedent: Though RealPage’s motion to have the case dismissed was rejected, the significant challenge of getting traditional antitrust laws to penalize algorithm-driven practices has been put into sharp relief. If RealPage comes out on top, the case could pave the way for more AI-abetted collusion with claims of plausible deniability.

Another multi-bn USD industry feeling the downsides of AI is scientific publishing. The field, built on foundations of credibility, has been rocked by several AI-fuelled scandals that have revealed vulnerabilities in the industry, Phys Org reports.

AI’s infiltration has led to the publication of the telltale “Certainly, here is a possible introduction for your topic,” as well as generated images with incorrect anatomical depictions. While experts concede that AI tools can be helpful, they emphasize that they need to be heavily scrutinized and regulated to avoid the spread of misinformation.

Not only has this revealed cracks in the work ethic of researchers submitting their work, possibly fueled by “publish or perish” culture, but also in the operations of peer-reviewed journals that allowed these bizarre fabrications to be published. Experts are tracking a sharp rise in AI involvement in research, with over 60k papers flagged in 2023 and more than 13k papers retracted, with projections for significant increases in 2024. Major publishers hit hard by these challenges have introduced AI-powered detection services to combat the problem.

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