Beta
×

Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

Microsoft Invents Price-Gouging the Least Influential

kdawson posted more than 4 years ago | from the free-to-ashton-kutcher dept.

Patents 259

theodp writes "In the world envisioned by Microsoft's just-published patent application for Social Marketing, monopolists will maximize revenue by charging prices inversely related to the perceived influence an individual has on others. Microsoft gives an example of a pricing model that charges different people $0, $5, $10, $20, or $25 for the identical item based on the influence the purchaser wields. A presentation describing the revenue optimization scheme earned one of the three inventors applause (MS-Research video), and the so-called 'influence and exploit' strategies were also featured at WWW 2008 (PDF). The invention jibes nicely with Bill Gates's pending patents for identifying influencers. Welcome to the brave new world of analytics."

Sorry! There are no comments related to the filter you selected.

puke (-1)

Anonymous Coward | more than 4 years ago | (#30417450)

just puke. It's all I can think of right now.

Well... (5, Insightful)

cheesybagel (670288) | more than 4 years ago | (#30417460)

Bill Gates also used to think his MSN proprietary network paywall would have more success than any silly Internet thingie. What he fails to realize is than in an Internet era, where price information travels rapidly, prices converge towards fixed prices. Not this drivel.

Isn't this a business method patent?

Re:Well... (2, Interesting)

jhoegl (638955) | more than 4 years ago | (#30417584)

Here is the scenario Microsoft is working on. People will buy their software online, retailers will offer it as well but MS will make them charge more than online citing "expense reduction" due to not having to make physical items. Microsoft will have your information, requiring you to put in your information including job info. They will also scan the web using their search engine to find out if you are "influential" and then based on that sell you the product at an increasingly lower cost. They will be able to do this because they will control the price of all their products and only offer online software via their site. Now do you think it will work? Its possible.

If I were an conspiracy theorist (3, Insightful)

Presto Vivace (882157) | more than 4 years ago | (#30417678)

I would assume that the open source movement has a mole within Microsoft, because this looks like a big win for open source software.

Profit with no knowledge: How? Abuse. (2, Interesting)

Anonymous Coward | more than 4 years ago | (#30417916)

Microsoft is widely misunderstood. It is not primarily a software company. It is an abuse company that uses software to deliver abuse.

That's my opinion, and the opinion of millions of others, it seems.

Microsoft CEO Steve Ballmer reportedly has little or no technical knowledge. Could someone with no technical knowledge make a high-tech company profitable without an abusive virtual monopoly?

Steve Ballmer, As Portrayed by 80 Blue Screens of Death [macobserver.com]

Re:Well... (5, Insightful)

Anonymous Coward | more than 4 years ago | (#30417592)

It think the point of this patent is that those people who are "less influential" will not have the means to tell the world they have been ripped off.

Re:Well... (5, Insightful)

Anonymous Coward | more than 4 years ago | (#30417644)

When you have many "less influential" people talking to each other and complaining about the same thing, you suddenly have an "influential" mob

Already an established business practice (2, Informative)

Kjella (173770) | more than 4 years ago | (#30417686)

Maybe they've wrapping it in a new packing, but this doesn't seem very different from the way it's always been - you have those who pay full price, those who get rebates, those who get promotional copies for free and those you have to sponsor, that is to say pay just to use your product and it's all a sliding scale. Like a friend of mine, he's often organizing dinners and such and when he's there alone items will "disappear" off the bill. Why? Because he'll be bringing in a bunch of people who'll spend a lot of money. A colleague of mine used to be quite good at his sport, he's not good enough they'd sponsor him anymore but if he asks he'll always get a "special price" because there's a value to having a veteran walking around in that brand. This sort of stuff happens all the time, and it's been done a million different ways of referrer discounts up to and including MLM schemes where it doesn't just get cheaper there's money flowing out at the top. This just seem like a slightly more organized version.

Re:Already an established business practice (5, Informative)

BrianRoach (614397) | more than 4 years ago | (#30417776)

Exactly. I also don't see where this is new or innovative, except that it's (presumably) on a large scale.

When I ran a motorcycle shop, we did this all the time. You know the local customers who bring in other business, often times not even consciously ... they do this because they have a "social influence". So ... you give them cheaper prices. The business they bring in more than offsets that discount.

With amateur racing, it's called "sponsorship" even if you're not giving things to racers for free. Give a fast guy parts at dealer cost and a break on labor, and he tells other racers how great your are.

In the "big leagues", companies PAY people to use their products because, well, most people are sheep and buy stuff simply because some "star" wears / uses it.

Nothing new to see here, move along.

Re:Already an established business practice (1)

umghhh (965931) | more than 4 years ago | (#30418006)

Interesting question would be: can you buy stuff that is not worn/used by a "star"? I have impression that the answer here would be flat 'no' so what this means we are all shepple and if you are concious or not it simply makes no difference anymore - all is commerce.

Re:Already an established business practice (0)

Anonymous Coward | more than 4 years ago | (#30418106)

More than an organized version, a formal mathematical expression of said pratice. Promotional prices are obviously low to promote a product, and it should be applied to people who can promote it.

Another case of patents gone wild.

False (1)

saleenS281 (859657) | more than 4 years ago | (#30417734)

Interesting. It seems to me celebrities still get all sorts of things for free, and it hasn't lowered the price the least bit for us "common folk". The internet does absolutely NOTHING to force companies to sell a product for the same price to everyone. If you think that you've either never gotten a deal, or you're living in a hole.

Re:False (1)

cheesybagel (670288) | more than 4 years ago | (#30417796)

You are ignoring gray markets and black markets. You can try to bend the natural laws of economics as much as you want. Even if you control the entire state apparatus, as in the Soviet Union, the irresistible forces of the market eventually provide your undoing.

Why do you think Free Software began in the first place?

Re:False (1)

saleenS281 (859657) | more than 4 years ago | (#30417886)

Because it can be replicated for free.

The patent says nothing about being limited to software based products. Let me know your solution to "free laptops".

Re:False (1)

cheesybagel (670288) | more than 4 years ago | (#30417922)

I said "fixed prices" not free.

But it helps to find cheaper offers (1)

Lonewolf666 (259450) | more than 4 years ago | (#30417998)

The internet is great for comparing prices and finding the cheapest offers. I have used that myself on occasion to get CDs below 10 euros or some electronic spare parts for a fraction of the price the official channels demand. And that is only about getting the same stuff cheaper. Finding alternatives from another brand is also easier when you can get all the information you need on the net.

Of course, the above covers only low priced stuff where most dealers won't bother with haggling because it would be too much work. For expensive stuff with a lot of visibility, the celebrities still have that advantage.

Re:Well... (1)

Dachannien (617929) | more than 4 years ago | (#30417846)

Yes, it's a business method, but no, it's not a patent. At least, not yet, anyway.

This one will undoubtedly get, ahem, "Bill-skied". Hopefully, we'll find out what SCOTUS has to say on the matter before it gets examined.

Re:Well... (2, Insightful)

Tom (822) | more than 4 years ago | (#30417870)

in an Internet era, where price information travels rapidly, prices converge towards fixed prices.

Sorry, you're 10 years behind. That's the original theory, but capitalism has since evolved away from the silly "free market" concept.

Or have you seen the price of Windos "converge" in any meaningful way? Have you missed the article a few stories down about price fixing in the LCD market? The many other examples of price manipulations?

The thing about this patent is that "price information" itself is manipulated. Your price information is meaningless to me, because I can not get it. When the price information is about different prices on the seller side, we as buyers can go to the cheaper seller. But this patent is about changing prices on the buyer side. There's not a whole lot the buyer can do, and since he doesn't have any market reactions available, there's no converging influence.

Re:Well... (1)

cheesybagel (670288) | more than 4 years ago | (#30418048)

Or have you seen the price of Windos "converge" in any meaningful way? Have you missed the article a few stories down about price fixing in the LCD market? The many other examples of price manipulations?

Have you read about netbooks? Originally Microsoft did not even want to sell Windows XP anymore because they wanted to boost Windows Vista sales numbers. Asus releasing the Linux Eee PC netbook was enough for forcing Microsoft to not only continue selling Windows XP, but lowering the price enough [live.com] to be competitive with the Linux desktops. Market distortions are older than dirt. The "father" of capitalism, Adam Smith, wrote The Wealth of Nations as a protest against mercantilism economics. He specifically mentions cartels as things to be avoided. Also notice that unlike the Windows Vista release, the number of Microsoft promotional offers, rebates, etc, increased a lot for the Windows Vista 7 release meaning they are in fact lowering the product ASP even if they do not specifically say so. Even "official" retail prices dropped [arstechnica.com] .

The thing about this patent is that "price information" itself is manipulated. Your price information is meaningless to me, because I can not get it.

The more users there are, the higher the chance price information will leak out. Microsoft does not exactly run a business amenable to these tactics. You are also assuming resale of product is impossible. Most businesses I know running highly differentiated pricing schemes do services, not products.

A Business Method - not patentable (0)

Anonymous Coward | more than 4 years ago | (#30417874)

Is that not the case? And. others already use the same or related structures - some for years. Oriental bazaars and traders have worked this way for centuries.

Re:Well... (1)

shawnap (959909) | more than 4 years ago | (#30418014)

Bill Gates also used to think his MSN proprietary network paywall would have more success than any silly Internet thingie. What he fails to realize is than in an Internet era, where price information travels rapidly, prices converge towards fixed prices. Not this drivel.

It is not the case that the increasing prevalence of the internet unambiguously hinders price discrimination; on the contrary, it makes some forms of discrimination, like those that rely on information asymmetry, more difficult and some, like loyalty systems and the like, easier.
Consider the case of Amazon. One one hand, the ability of the customer to buy books online for the same price from any location makes geographic price discrimination by the brick-and-mortar firms much more difficult. Amazon's Kindle, however, makes books relatively non-transferable, making sophisticated complete price discrimination feasible.

Re:Well... (1)

BikeHelmet (1437881) | more than 4 years ago | (#30418124)

Besides, in some cases services like steam already have the same effect, but without the patent. I'd argue that your influence correlates to how much you watch these places for good deals. The more time you spend, the more likely you are to tell people about it. Thus, you have influence and lower prices, and it occurred naturally without a patent.

Take a look at this series of events:

-I see $5 game. (80% off)
-I purchase $5 game.
-I tell friends $5 game is good.
-Friends either buy at $5 or buy at full price because they're too slow. (or wait for another lesser sale)

Of course...

-I FRAPS video from game.
-I put video up on Youtube.
-People comment that $5 game is good and they enjoyed it.
-People comment that they didn't know [$SERVICE] had such good prices.
-Video gets taken down by DMCA because someone was playing crappy music on Ventrilo while being recorded.
-I buy new $5 game...

Works for me (4, Funny)

ironicsky (569792) | more than 4 years ago | (#30417468)

Hey, works for me... Microsoft gave me a free copy of Windows 7 Ultimate 64 bit for hosting a Windows 7 party... I am influencial, I get free software!

TOOL (2, Funny)

Anonymous Coward | more than 4 years ago | (#30417494)

You sir are a tool, and apparently happy to be one.

Re:Works for me (2, Interesting)

peragrin (659227) | more than 4 years ago | (#30417662)

yes but how much did you actually spend on said party? $100? $200.

Re:Works for me (1)

Opportunist (166417) | more than 4 years ago | (#30417854)

Not to mention how many "friends" are now pissed at you 'cause you conned them into buying Win7? :)

Re:Works for me (4, Funny)

Vintermann (400722) | more than 4 years ago | (#30417980)

The golden rule of multi-level marketing: Although friendship cannot be bought, it can still be redeemed for cash.

Re:Works for me (1)

gparent (1242548) | more than 4 years ago | (#30418146)

If you have friends that can bring their own alcohol and buy their share of pizza, $0?

Should fail due to prior art. (5, Insightful)

Sebilrazen (870600) | more than 4 years ago | (#30417478)

I'd swear that's what the merchandise bags they give out at movie premieres are. The celebrities get stuff free, wield their influence over those susceptible to influencing who rush out and buy it. $0->$x.

Re:Should fail due to prior art. (1)

cheesybagel (670288) | more than 4 years ago | (#30417514)

Reading is some more this seems awfully familiar to multi-level marketing [wikipedia.org] . Enjoy your brand new MS Herbalife overlords.

Re:Should fail due to prior art. (1)

daveime (1253762) | more than 4 years ago | (#30417842)

Nah, most MLM's involve convincing you become an "entrepreneur businessman" by selling you a tube of toothpaste for $27 dollars. Then, rather than face the fact you just got ripped off, you have to invite your family and friends to "sales meetings" where you can offload the toothpaste to them so that they can become "entrepreneur businessmen" also.

Basically it means recruiting people for whom money is more important than their closest family and friends, and would happily fuck them over to recoup their losses. Possibly why MLM is so popular in America.

Re:Should fail due to prior art. (0)

Anonymous Coward | more than 4 years ago | (#30417832)

The patent specifically talks about digital goods that can be reproduced at no cost and internet-based social networks. So physical goods and real-world influencers would not be prior art. .. not that I disagree that they should be as the whole thing is marketing 102.

Re:Should fail due to prior art. (1)

Zadaz (950521) | more than 4 years ago | (#30417978)

This sounds like exactly what happens when I go out to eat:

When I go out to eat at a new restaurant I get regular service and pay 100%.

When I go to eat as a restaurant I'm a regular at I get good service and pay 90%.

When I go to a restaurant with a friend who owns a well regarded restaurant I get amazing service and pay %50.

When I got to a restaurant with the staff of a popular TV cooking show, the owners and chefs come out from the back and do gymnastics and we eat for free.

Heck, this is already applied to software. Do you think game reviewers pay for their review copies?

Re:Should fail due to prior art. (1)

Sebilrazen (870600) | more than 4 years ago | (#30418100)

When I got to a restaurant with the staff of a popular TV cooking show, the owners and chefs come out from the back and do gymnastics and we eat for free.

If the chefs come out, who cooks?

Just kidding, your example is much more verbose than mine.

Linux users (1)

peragrin (659227) | more than 4 years ago | (#30417480)

Yet another attempt by MSFT to influence Linux users. By charging them triple for the same product.

I can see this going over like a lead filled ballon. While costs for goods may rise and drive up prices, prices themselves have a way of going down with volume. Of course in a market (software) that doesn't produce physical products pricing is artificial anyways.

That's right! (1)

NoYob (1630681) | more than 4 years ago | (#30417562)

Yet another attempt by MSFT to influence Linux users. By charging them triple for the same product.

I can see this going over like a lead filled ballon. While costs for goods may rise and drive up prices, prices themselves have a way of going down with volume. Of course in a market (software) that doesn't produce physical products pricing is artificial anyways.

And look at the picture ! It s NAZI Salute! [bizjournals.com]

There you go, it's all part of Gates' plan to take over the World and crush Linux! I can tell!

Re:That's right! (0)

Anonymous Coward | more than 4 years ago | (#30417984)

It s NAZI Salute!

No, he's just indicating how tall he'd be if he were scaled to his penis size.

Re:Linux users (2, Interesting)

quadelirus (694946) | more than 4 years ago | (#30417572)

This is not a challenge, just a clarification question: how exactly do linux users factor into this discussion? It seems to be about using information gleaned from social networks to adjust prices in order to maximize product adoption. Also, I wouldn't be so certain this wouldn't be popular. If everyone in your social group wants to be like person X and MS can determine this and give something to person X for free that will cost you and the rest of the group $10, I'm not sure so many people would abstain as a protest. Or at least not more than the gain in revenue seen by the scheme. I think of it like this: when the iPhone came out all the geeks bought them, and then convinced everyone else to buy them. Because of the cult of Apple it wasn't too hard to get tons of geeks to get them and show everyone else how cool it is. On the other hand not as many people were buying Zunes and convincing their non-geeky friends to buy them. What if MS was able to determine the people who had the most influence on their social group's technology buying habits and sent them all free Zunes? It seems like if this could be done accurately it would be an incredibly effective marketing ploy (of course, that is a big IF).

Re:Linux users (2, Interesting)

peragrin (659227) | more than 4 years ago | (#30417742)

simple linux users are the at the bottom of the social ladder. little influence means they have to pay higher.So MSFT has found a way to segregate and separate the general population into a class, pricing structure based who they know. If you can't see how this is bad then you need to open up a history book on class seperation through the ages and the methods used to keep a group of people down.

Also when the iphone came out it wasn't just geeks buying them. the general masses found an easy to use phone and mobile web browser and the rest was history. People who buy the "iphone killers" soon get disappointed as the interfaces aren't as useful and they grow frustrated at them over time.

Re:Linux users (1)

Billly Gates (198444) | more than 4 years ago | (#30418112)

The phrase money talks and sh*t walks is true.

Linux does not have a sales team and therefore is losing the server market.

Management always buys what the marketing sales teams at proprietary software companies push and they become friends with the sales teams. What is interesting is in the severe recession we are in now is that this approach does not work well. If the budget is slashed to $0 for software upgrades it does not matter what the discount is. Linux actually wins hands down.

All this shows is perhaps conflicts of interest are involved in giving discounts to purchasers. In the end the employer looses.

Re:Linux users (1)

daveime (1253762) | more than 4 years ago | (#30417872)

I'm wondering how many Linux users would actually *be* on a social network, seeing as even a simple thing like Flash is so hard for them to get working ?

Or maybe MS is doing some fancy data-mining.

1. Bought a computer ?
2. Asked for a refund on the preinstalled copy of Windows ?
3. No profile found on Facebook ?
4. ???
5. Linux User Profit !

I wonder how long it would (1)

future assassin (639396) | more than 4 years ago | (#30417484)

take as a regular person (not a corporation) for me to be charged with some kind of "fill in the blank" conspiracy if I started keeping tabs on people like the corporations do.

Are we actually gonna be citizens in the next 50 years or just law abiding consumrzens with laws that put us into jail of we don't spend our money fast enough on new shiny things.

Patentable? (2, Insightful)

Bel Riose (1683532) | more than 4 years ago | (#30417486)

I can't believe, that some pricing strategy is patentable. Is this a joke (I'm a layman in such matters)?

Re:Patentable? (2, Interesting)

Opportunist (166417) | more than 4 years ago | (#30417882)

I'd have thought it would be shot down with prior "art" simply because tiered pricing has been in existance since bakers gave away their goods to the emperor for free to bear the titel of "emperor's baker".

seems dangerous (5, Insightful)

Trepidity (597) | more than 4 years ago | (#30417492)

Approaches like this are pretty direct attacks on why free markets work. Almost all classical and neoclassical economic theory assume things like the existence of a supply/demand price curve, availability of pricing information, etc. If you have some nutty system where price curves aren't really defined beyond an individual level, prices aren't widely available, etc., all the usual pricing signals, resource allocation by the "invisible hand", etc., get a lot more muddled, and probably begin to break down.

Of course, that's certainly a reason I can see Microsoft wanting it: finding ways to profit other than "make a good product and compete fairly on the open market" is their modus operandi.

Re:seems dangerous (2, Interesting)

quadelirus (694946) | more than 4 years ago | (#30417608)

We already have this sort of thing on a macro scale. Gadget magazines are sent free gadgets and many of us make buying decisions based on those gadget magazines. This is just a finer grained version of the same old system.

What scares me about this is that it would create the same kind of frenzied I-want-to-get-as-many-facebook-friends-as-possible-no-matter-if-I-know-them-or-not mentality except with profit motive behind it. The more friends you have, the more MS thinks you are an influential person, the cheaper products are for you. I think that this sort of thing would probably be quickly gamed by many people to the point of being worthless to the marketer.

Re:seems dangerous (2, Interesting)

Trepidity (597) | more than 4 years ago | (#30417748)

Yeah, I agree it already happens, but I think there can be a qualitative difference if it gets hugely pervasive. In the case of free gadgets being sent out, you can at least plausibly still identify a "normal market", where people buy things based on price signals and preferences. It might be distorted somewhat by the reviews the free-gadget-recipients produce, but that's not really in principle different from any other disinformation that distorts markets; just another variety of misleading advertising.

But if the pricing variance is built into the market itself, it seems quite a bit worse to me. You no longer have a normal market with people trying to distort it, but no real market at all anymore.

Re:seems dangerous (2, Insightful)

physicsphairy (720718) | more than 4 years ago | (#30417754)

If you have some nutty system where price curves aren't really defined beyond an individual level, prices aren't widely available, etc., all the usual pricing signals, resource allocation by the "invisible hand", etc., get a lot more muddled, and probably begin to break down.

Companies already have all sorts of way to optimize price models besides looking at a supply demand curve so as to pick one point of intersect. Coupons and discounts allow you to charge more for wealthier individuals, who are less conscerned with spending their Sunday afternoons clipping newspapers. Charging less for over-the-weekend flights means you are effectively able to set higher prices for business trips. Those Pepsi-codes that give people prizes effectively makes Pepsi cheaper to the consumer based on his/her willingness to invest some extra time in winning contests.

And overall this is no different than paying Michael Phelps $x-million to appear on a box of cereal, except now the $x-million is being distributed to somewhat more ordinary people who act as local rather than national advertisers.

Re:seems dangerous (4, Insightful)

Tom (822) | more than 4 years ago | (#30417826)

Approaches like this are pretty direct attacks on why free markets work.

Yes, they are. Surprised to see a direct attack on the free market by a convicted monopolist? ;-)

Nobody, and I'm serious on that, not the most convinced communist, not the most radical islamic fundamentalist, hates a free market as much as major corporations. Pretty much everything that determines a free market is an obstacle towards their ultimate goal: Unlimited, guaranteed profit.

I'd have thought after the financial crises more people would've noticed.

Re:seems dangerous (2, Insightful)

ISoldat53 (977164) | more than 4 years ago | (#30417918)

This is why reviews on Angie's list, CNET, Slashdot, Amazon and the like are getting more important. When you make a report on something like Angie's List you can influence many more people than your lowly ranking as an end-user would normally indicate.

Re:seems dangerous (1)

Kjella (173770) | more than 4 years ago | (#30417944)

There's many simple cures for this one as a mass market thing - vanity for one. Everybody thinks they're above average important and a lot of customers will be insulted that they're not deemed important enough. A lot of people will feel ripped off for having to pay more than the next guy for "no reason" in their opinion, I remember amazon played with this a little while but quickly stopped. There's the easy possibility for arbitrage, if a "trendy" friend of mine doesn't want something but I do, I can setup it up so he buys it at reduced price, I get it and we split the profits. I think a set of dependent PQ-curves should cover this nicely, you have a PQ for leaders and a PQ curve for followers that is a function of number of leaders buying. Then you optimize for the marginal unit where your marginal losses for leaders equals your marginal profits for the followers. It gets more complicated with many tiers but I don't see a real problem modeling it and nothing that'll break much of typical economics.

Bullshitters and marketers posing as research (-1, Flamebait)

Anonymous Coward | more than 4 years ago | (#30417498)

Stop posting spam from these fucking bullshitters. These assholes are wasting columns space that could be spent on technology, news for nerds or stuff that matters. Leave the marketing elsewhere, especially from posers.

There's only one thing to do! (4, Funny)

Interoperable (1651953) | more than 4 years ago | (#30417506)

Let's all friend each other on Facebook...the entire /. community. We will all be considered exceptionally influential and will therefore be given free stuff.

Re:There's only one thing to do! (2, Funny)

gbarules2999 (1440265) | more than 4 years ago | (#30417914)

Or we could make a website where we all chill and talk about the latest news! Yeah, and we could come up with a bunch of lame meems that spread through the internet, just to show how influential we really are! Sounds kick ass to me.

Re:There's only one thing to do! (0)

Anonymous Coward | more than 4 years ago | (#30417958)

I fail to see the reason for this post to be tagged as 'Funny'. Insightful, or at least Interesting.

It's a perfectly valid procedure (or at least until they start sending DMCA takedown notices, even though it's outside DMCA scope).

How is this any different than now? (2, Insightful)

NoYob (1630681) | more than 4 years ago | (#30417526)

[0004]The described implementations relate to social marketing. One technique identifies potential buyers of a product where the potential buyers belong to a social network. The technique determines a price to offer the product to individual potential buyers that considers both influence of the individual potential buyer within the social network and overall revenue from sales of the product to the potential buyers.

[0005]Another implementation identifies potential buyers of a product in a social network. The implementation arbitrarily selects a set of the potential buyers to offer the product at a relatively low price to influence the remaining potential buyers. The implementation also updates membership in the set by adding and removing individual potential buyers from the set until revenue from product sales to the social network is not increased by adding or removing an individual potential buyer from the set. The above listed examples are intended to provide a quick reference to aid the reader and are not intended to define the scope of the concepts described herein.

The rock stars get their guitars for free (Paul McCartney once commented:"When you're poor you cant' afford them and when you're rich they give them to you.) is the same thing.

Or how about paying celebrities to use your product.

Now the randomly selecting people part. What's wrong with that? So they're trying to accelerate the product to the tipping point.

This will hurt no one and this was just an "article" to have an excuse to bash Microsoft about something. *yawn*

Re:How is this any different than now? (2, Insightful)

quadelirus (694946) | more than 4 years ago | (#30417636)

"This will hurt no one and this was just an "article" to have an excuse to bash Microsoft about something. *yawn*"

I mildly agree; forgetting the fact that it is MS however, it might be legitimate to ask how this can be patented when it is already the system that has been in place since the dawn of marketing. (Send free stuff to people who influence buying decisions; product giveaways; etc)

Re:How is this any different than now? (0)

Anonymous Coward | more than 4 years ago | (#30417650)

It's not, and judging from the start of the discussion it's going to be funny to see how the "prior art" (because this is common practice today, just less scientific perhaps) is going to fare vs. the "Microsoft proposing new evil" line. They are mutually exclusive, but I'm sure we'll manage to combine them and condemn Microsoft for violating both at once :)

Monopolists price fixing (1)

jhoegl (638955) | more than 4 years ago | (#30417550)

Wait a tic... http://en.wikipedia.org/wiki/United_States_v._Microsoft [wikipedia.org] If anti-trust doesnt cover this, we need to call our congress people right away.

Re:Monopolists price fixing (0)

Anonymous Coward | more than 4 years ago | (#30417938)

Wait a tic... http://en.wikipedia.org/wiki/United_States_v._Microsoft [wikipedia.org] If anti-trust doesnt cover this, we need to call our congress people right away.

Or.. you need to read TFA and not just the FUD/.summary. I'm not sure how they managed to cram 'monopolist' in there with a straight face, but this has no relevance what so ever to the topic. It's about how you (anyone) can use preferential treatment of/discounts to influentials for marketing purposes (which is not new, btw. by far).

New Business Model (3, Interesting)

BitterOak (537666) | more than 4 years ago | (#30417568)

1. Become influential or join together with a group of influential friends.

2. Buy things very cheap.

3. Sell them at a higher price.

4. Profit

In fact, you could set up a brokerage business where you find people that have cheapest access to things, offer to buy from them at a slightly higher price than they pay, and sell at a higher price to groups that would have to pay even more. Lots of profit opportunities here.

Re:New Business Model (0)

Anonymous Coward | more than 4 years ago | (#30417578)

Better get your patent attorney on the horn, you've just invented arbitrage :).

The commercialization of friendship (3, Insightful)

Fractal Dice (696349) | more than 4 years ago | (#30417580)

Influence mapping scares me deeply. It completely devalues the entire concept of friendship, turning every relationship into a marketing channel, every person into a spambot zombie hoping for a discount from sellers or a better performance appraisal at work.

I would love to see the practice outlawed, but data mining is becoming so pervasive I don't know how you prove its even happening without catching differential pricing caught in the act.

Re:The commercialization of friendship (3, Insightful)

snooo53 (663796) | more than 4 years ago | (#30417728)

This already happens to some extent with friends who are part of a multi-level marketing type company (Avon, Mary Kay, etc..) or with school/church fundraisers. The only difference here is that it is digital and therefore much easier to ignore, and much harder to guilt trip someone into purchasing to help out a cause or a friend

Re:The commercialization of friendship (4, Insightful)

honkycat (249849) | more than 4 years ago | (#30417792)

I have an easy solution to that. Anyone who tries to sell me MLM stuff ceases being my friend.

Re:The commercialization of friendship (3, Interesting)

moonbender (547943) | more than 4 years ago | (#30417858)

Fuck 'em. Don't buy their shit. Hell, make it a general principle and don't buy shit in general. Ask yourself "Do I really need this"? Spend more money on food and wine, ideally without a long distribution chain between you and the producer.

Re:The commercialization of friendship (2, Interesting)

aaandre (526056) | more than 4 years ago | (#30417976)

The natural tendency of Money + Usury = monetizing everything.

Check this essay on the nature of current money implementation, how it robs humanity of true value and alternatives:

http://www.realitysandwich.com/money_a_new_beginning [realitysandwich.com]

Damn impressive spin (0)

Anonymous Coward | more than 4 years ago | (#30417588)

Wow.. I'm sure the summery and title could possibly be more inflammatory and inaccurate, but damn if I can think of how.. You did get me reading and searching through the thing, and.. not sure where to start, but.. there is absolutely no mentioning of "monopolists" in the patent, and it is not about 'price gouging the least influential' (damn I'm impressed by that reversed spin) this is supposedly a system to more scientifically differentiate how you identify and use influentials for marketing purposes (like how many bloggers today receive free or discounted samples to talk about, or just general discounts on a brand/store). This sort of thing has only been going on since people starting selling things to each other.

Re:Damn impressive spin (1)

jhoegl (638955) | more than 4 years ago | (#30417634)

Yeah but, Microsoft is evil and I fear them due to stories I read... on slashdot. Oh crap... Slashdot is to Microsoft as Fox News is to Democratic party. (curse you school, I swore I would never use comparisons!)

Will They Ever Get to Try This? (1)

notseamus (1295248) | more than 4 years ago | (#30417614)

This can't be legal, especially under any sane consumer protection laws. I really can't see them ever getting to try this, especially in the EU, where for anything Microsoft do, there's a team of lawyers waiting for the chance to fine them for it.

On the other hand though, sometimes I like to think that Microsoft go around patenting bad ideas to protect them, not for their own use, but to stop someone really malignant from using them in the real world. How on earth does one determine influence anyway?

Re:Will They Ever Get to Try This? (0)

Anonymous Coward | more than 4 years ago | (#30417758)

This can't be legal, especially under any sane consumer protection laws. I really can't see them ever getting to try this, especially in the EU, where for anything Microsoft do, there's a team of lawyers waiting for the chance to fine them for it.

On the other hand though, sometimes I like to think that Microsoft go around patenting bad ideas to protect them, not for their own use, but to stop someone really malignant from using them in the real world. How on earth does one determine influence anyway?

sorry to break this to you, but this is going on large scale today, 'influentials' already get preferential treatments, including discounts up to 100%. This is what many bloggers live off. In the US FTC have recently been introducing some regulation on disclosure for bloggers and celebrity endorsements/testimonials.

Nobel prize for Bill (0)

Anonymous Coward | more than 4 years ago | (#30417620)

Some day Bill Gates will be nominated for Nobel prize for his great work of philanthropy, for sure.

Doesn't the FTC ruling mean that... (3, Interesting)

mysidia (191772) | more than 4 years ago | (#30417622)

If you receive a more preferable product for a good or service based on your social network status (or on your blog), you have to disclose that, according to the FTC [ftc.gov] .

You aren't allowed to get a better price based on your influence/following and fail to disclose it.

This type of pricing scheme is dangerous, and might land company executivies in jail, for the attempt to defraud less-influential people with higher pricing.

However, I expect this could backfire... some of the more influential people will certainly say what price they got.

You can't control this type of information. There will be a backlash / disillusionment when other people learn that they are getting a different price.

In fact, the "more influential person" may lose influence, when people discover that.

E.g. Getting the better price can have long-term social costs in how other people in your social network view you.

Good Advise vs. "Sell-out"

Re:Doesn't the FTC ruling mean that... (1)

Artifakt (700173) | more than 4 years ago | (#30417868)

Don't even sweat the FTC - What do you think the IRS does about people not declaring anything over De Minimus items as income? An old rule of thumb has been that items of less than 50 $ are trivial benifits. However, one of the last IRS decisions on employee receipt of employer distributed goods held that the limit where an item was too trivial to report lay somewhere between providing coffee and doughnuts for breakfast (acceptable without bothering to keep records or report) and actually providing a full breakfast such as biscuits, bacon and eggs. Given what an Egg McMuffin, for example, costs, the ruling means people may well be required to report all gifts with a value of about 2.00 $ US and up as miscellanious income, subject to the individual Income tax, and Social Security and Medicare taxes.

Perfect. (2, Funny)

selven (1556643) | more than 4 years ago | (#30417626)

Now nobody else can do it. Can I have my $150 Photoshop now?

You know what this means (2, Insightful)

muncadunc (1679192) | more than 4 years ago | (#30417640)

People will find ways to game this system, just like people gamed search engines with Google bombs.
If you think blog spam is bad right now, just you wait.

Bing (3, Funny)

Tom (822) | more than 4 years ago | (#30417658)

And someone just said yesterday that the privacy policy of Bing is better than the one for Google.

Looks like they have the next few revisions already in mind, with substantial changes.

Re:Bing (1)

jpmorgan (517966) | more than 4 years ago | (#30418096)

Pff, they don't have to invade anybody's privacy to pull this stunt off. These days most people are willing to give out that kind of information for free.

Game theory (2, Insightful)

giorgist (1208992) | more than 4 years ago | (#30417660)

So now MS is patenting Game theory.
What netx, algebra ?

Standard marketing strategy, automated. (1)

Tubal-Cain (1289912) | more than 4 years ago | (#30417666)

It's a common story about young entrepreneurs that give samples of their products to "popular" people to create demand. This is, ultimately, just that strategy writ large.

Prior art: Any specialty business / "sponsorship" (2, Informative)

BrianRoach (614397) | more than 4 years ago | (#30417672)

I used to run a motorcycle performance shop. You do this all the time. I would often cut deals on accessories / parts to customers I knew would show them off to their friends, talk on the internet, etc, etc. Those people (hopefully) then buy from you at your regular prices.

When you do it for club racers, it's called "sponsorship" ... but it's really the same thing. If you have a fast racer, you help him out based on his "influence" (wins races, is well liked, etc). Regardless if your assistance makes him go faster or not, the perception is: "Fast / winning guy goes to Shop X, I should also go to Shop X". They have influence over their "social network", which is other racers.

Seriously, I don't see how this is new or innovative.

Wow (3, Insightful)

MadUndergrad (950779) | more than 4 years ago | (#30417702)

This is the most evil plan related to software that I think I've ever heard. Their plan is basically to prey on the weak. Are they going to patent stealing candy from children next?

Re:Wow (0)

Anonymous Coward | more than 4 years ago | (#30417802)

I forget. Do the people have to buy?

Re:Wow (1)

KarmaMB84 (743001) | more than 4 years ago | (#30418174)

The idea is giving discounts or freebies to people who will tell others about your product. Right now they might just give it away for free to reviewers with a large audience. What they'd like to do is identify people they could sell the product to for half price or some other fraction while getting a similar effect. They don't want to give it to them for free if they could get them to pay something for it while still telling all their friends.

The article title could've used some work IMO.

If only... (1)

QuietLagoon (813062) | more than 4 years ago | (#30417716)

If only Microsoft spent half as much time on improving Windows as they spend on this "research".

Apply to Slashdot moderation? (1)

noidentity (188756) | more than 4 years ago | (#30417720)

Moderators, let's try that scheme here. Give this post 0, 5, 10, 20, or 25 points, based on the influence this author wields. I await your judgment.

Cool (2, Funny)

FlyByPC (841016) | more than 4 years ago | (#30417722)

I, for one, welcome the new opportunity to game the system. I mean pricing scheme.

This is done everywhere... (2, Interesting)

jmerlin (1010641) | more than 4 years ago | (#30417760)

Just look at what they're proposing. Those who INFLUENCE other people in a way that makes a product more valuable.. are desirable customers. So we discount them or give the product to them for free because it increases the value of the product on the whole. Let's look at two examples that are present in all places one might wish to look:

1. Advertising. Duh. Sports athletes, actors, models, and other such famous figures. We see them sporting things GIVEN to them by companies. Why? Because the trend is: "he/she has it, that's so cool, I want one too!" That's exactly what this system is.
2. Referral rewards. This one is particularly damning to this patent. Many companies allow people to refer other customers and as a reward they eventually get a kickback or free stuff. Why? BECAUSE THEY ARE HIGHLY INFLUENTIAL. And there you have it, this EXACT system, down to the letter. If you prove you're influential, we give you a discount or free things because we know you're likely to bring us more customers and as a result we can raise our prices.
This patent will almost certainly be shot down via prior art if those in charge of approving them have paid attention to marketing strategies for the past few decades.

Yay! (2, Funny)

arun84h (1454607) | more than 4 years ago | (#30417762)

Only 5000 more rep and I'll be exalted with the Microsoft faction! Discounts abound!

Sounds like it boils down to... (1)

meerling (1487879) | more than 4 years ago | (#30417800)

... Screw the geeks, dweebs, nerds, and awkward kids and adults, give it away free to the popular people...

Guess what, we are NOT the popular people out there.
Do you really want to subsidize them?

As to the celebrity thing, I don't much like it, they get paid lots of money, they can afford to buy their own freaking PS3, and the house to put it in, but that at least falls under advertising.
However, making it a form of industry wide pricing scheme, that has to be illegal.
(And if it isn't, it should be.)

"I'm sorry mam, according to the index, nobody really likes you, so we have to charge you 3 times as much for that."

Isn't this how capitalism works now? (2, Interesting)

dfn5 (524972) | more than 4 years ago | (#30417820)

an example of a pricing model that charges different people $0, $5, $10, $20, or $25 for the identical item based on the influence the purchaser wields.

This is just an observation, but when I hear things like "We got 80% off list price for technology X from our vendor" it makes me wonder what the real value of the product is. After reading this maybe the value of the product is really irrelevant and in our world of commerce it depends on how influential you are. If that is the case how can they patent how the world currently works?

Paying for astroturfing (2, Insightful)

tomhath (637240) | more than 4 years ago | (#30417830)

FTFP: "The technique determines a price to offer the product to individual potential buyers that considers both influence of the individual potential buyer..."

Microsoft wants to pay its customers to astroturf for it. Where I come from that's called a kickback, bribe, or politics as usual.

free stuff ? (2, Interesting)

naeone (1430095) | more than 4 years ago | (#30417838)

for free stuff i use p2p, best marketing tool ever, apart from the sales graph

Dear kdawson (0)

timmarhy (659436) | more than 4 years ago | (#30417864)

please read your own submissions and maybe they wouldn't have logic fails in the tital and summary, and just might stop sucking so much.

sincerely, the internet.

Wait! Is it gouging the least influential... (2, Interesting)

jejones (115979) | more than 4 years ago | (#30417904)

...or bribing the most influential?

So how do you game that system? (2, Insightful)

Opportunist (166417) | more than 4 years ago | (#30417906)

Let's be blunt here, if one side ceases to play fair, I see no reason in not following.

So what's the requirement to be seen as "influential"? Having a shitload of friends on facebook? Great. Let's start a group dedicated to the sole purpose of having friends. People you don't know or don't care about, as long as you have a lot of friends you get crap cheaper? Works for me.

Way too much prior art (1)

istartedi (132515) | more than 4 years ago | (#30418032)

Famous people and/or well-connected people have been getting "gifts" from companies for ages. Some of the very first wheels were probably given to the chief with the big spear, while the guy in the cave next door had to give saber-tooth cat pelts in exchange.

Prior art (4, Insightful)

gmuslera (3436) | more than 4 years ago | (#30418052)

A pretty close one: having the option to disable slashdot ads based on user karma.

This is ideal for a kick in the nuts analogy (2, Funny)

KickInNutsAnalogyGuy (1697658) | more than 4 years ago | (#30418108)

Consider the following: You've been tasked with junk-kicking the man business of a certain number of individuals. The parameters of your task are only concerned with the number of people junk-kicked; you decide which people's man business gets junk-kicked to meet your assigned quota. Are you going to junk-kick Vladamir Putin or Osama Bin Laden? How about Kim Jong-il? Tom Cruise? I would think not. That some of the aforementioned people might deserve a junk-kick in their man business matters not. They all have massive influence and could easily make you: disappear, die, rot in prison, or a level 5 Thetan.

The obvious targets for a junk-kick in the man business would be individuals with very little influence: Luxembourgians, educated American voters, Gary Coleman, The Jackson family sans Michael, and etc. These targets would have little recourse other than to accept a good junk-kick in the man business. In fact, some groups are repeatedly being junk-kicked in the man business (read: educated American Voters).

I think it's safe to say that a lack of influence == junk-kick in your man business.

What a sick fricking world. (1)

tjstork (137384) | more than 4 years ago | (#30418126)

Has the world gotten so twisted that we cannot create a place for kids to hang out online without a bunch of assholes trying to put them under a magnifying glass to sell them something? Why do people expect teenagers to be anything less than jaded when the whole of humanity does nothing but pander to them like objects and crowds them into little spaces.

HEY, TEACHERS! LEAVE THEM KIDS ALONE.

Load More Comments
Slashdot Login

Need an Account?

Forgot your password?