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How much of your life do you want to be orchestrated by AI?

Thursday, October 6, 2016 13:57
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Ariel Ezrachi is the Slaughter and May Professor of Competition Law at the University of Oxford, and Maurice Stucke is a Professor of Law at the University of Tennessee (Knoxville). They write,

For instance, the digital butler may help the platform refine its profile about us, including our likely reservation price, use of outside options, shopping habits, general interests, and weaknesses (including moments when our willpower is fatigued). This information can enable ‘behavioural discrimination’, where the platform can facilitate our buying products that we otherwise wouldn’t, at prices closer to our reservation price. The more we rely on the butler, the less likely we will be aware of this discrimination. Even if we search the web, the ads, products, or search results we see may be orchestrated by our butler.

While providing us with a distorted view of available options and market reality, our trusted butler can also exclude rivals. When the butler promotes its affiliated products and services, it may become harder and costlier for retailers unaffiliated with the platform’s advertising business to reach us. Even when the retailer can gain our attention, the personal assistant may interject with its own recommendation, suggesting a special deal by a member of its platform’s ecosystem. In this multisided market, the assistant may subtly push certain products and services and degrade or conceal others, all in the name of personalization.

Rather than deter such abuses, market forces, given the data-driven network effects, can actually increase entry barriers. The strong platforms (and their butlers) become even stronger, extracting even more personal data, and commanding even higher rents to allow others to target us. Not only will our pocketbooks be affected. Our political and social discourse could also be manipulated, as we increasingly rely on our butler for our news and entertainment. The gatekeeper could subtly, but effectively, intellectually capture its users in this unique bubble –– where users happily roam, unaware of the outside market for products, services and ideas.


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