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Sunday, November 24, 2002

The Information Revolution is Here, Long Live Information

Economists who theorise about the conditions necessary for the existence of perfect markets have long identified information, and wide and easy access to it, as a necessary condition for the well-functioning of a market society. The magazine 'The Economist' has often drawn our attention to the lowering of 'market search' costs as one of the cornerstones of the new improved productivity of the information era. Well here it is. You can now compare sale prices before the sales begin. We all know that things are speeding up. The British politician Harold Wilson is perhaps best remembered for his phrase 'a week in politics is a long time'. Perhaps we should fast forward this a bit and coin the moden equivalent: 'a day in the internet is a long time'. There is, I feel, a serious point buried away here somewhere.

Sale prices from Wal-Mart and Target may not seem like big secrets, especially since they're plastered all over newspapers, but big retailers nonetheless cried foul last week after their post-Thanksgiving sale prices leaked onto the Internet. "This is proprietary information that could have a serious adverse impact on Staples' business," said Staples Vice President Paul Capelli. "It can telegraph to your competitors your plans for future business." Staples was among six retailers that sent notices to FatWallet.com, a bargain-hunter site, demanding it remove posts by visitors on a community message area revealing specials to be advertised for this week's "Black Friday" sales. Since it's the kickoff of the holiday shopping season, the day after Thanksgiving is a highly competitive time for retailers. Other complaining merchants included Target, Jo-Ann Stores, Wal-Mart, OfficeMax and Best Buy.

"We feel that prices are public facts" and therefore shouldn't be subject to copyright, added Dan Baxter, who runs DealCatcher (www.dealcatcher.com), another site asked to remove sales data.People posting the information were identified only by their screen names, and several merchants said they are pressing FatWallet, DealCatcher and other sites to cough up the leaksters' contact info so they can take "appropriate action" against them. Lest you think nobody cares about advance peeks at Barbie and Lego discounts, check out the Yahoo discussion group that formed Wednesday. By Friday more than 6,000 people had joined the "Black Friday Ads" group (groups.yahoo.com/group/BlackFriday), where people were publishing long lists of sale prices said to be offered in stores Thanksgiving weekend.
Source: Washington Post

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