GoKawiilSign up to see the future, today Can’t-miss innovations from the bleeding edge of science and tech Email address Sign Up Thank you!
Amid its pivot to AI, the Washington Post is abandoning the traditional fix-priced subscription model.
According to new reporting from Washingtonian, the once-venerable newspaper will now be setting readers’ subscription rates based on an AI-driven algorithm that interprets their personal data, mirroring controversial schemes used by services like Uber, Ticketmaster, and airlines.
Readers were informed of the change in the fine-print of an email they received last week warning them that their fee was being set at a higher price. “This price was set by an algorithm using your personal data,” it stated.
The Post is being opaque about how the pricing algorithm works. When Washingtonian asked the Post for comment on the new pricing mechanism, it directed the paper to a blog post from its engineering team which explains its new AI-driven “smart metering model.” The model determines the number of articles that anonymous users, who aren’t registered on the Post’s website, and registered users, who’ve signed up but don’t pay for a subscription, can read before being shown a paywall.
It’s the latest sign of how the newspaper has undergone a tech- and AI-inflected pivot under the ownership of Jeff Bezos. Bezos’s Amazon, for instance, uses a dynamic pricing scheme that determines prices based on details like demand and location.
On top of putting an extra squeeze on customers, the use of algorithms to make real-time pricing changes can be alarmingly invasive. Luca Cian, a professor at the University of Virginia’s Darden School of Business, told Washingtonian that algorithmic pricing models typically rely on user demographics and location to tease out how much someone is willing to pay for a product, as when the college prep service The Princeton Review was caught charging more for SAT tutoring in areas with a higher Asian population in a so-called “tiger mom tax.”
But it can go deeper. A newspaper like the Post, he said, “can calculate in real time a high level of complexity based on massive data they acquire throughout the year, based on all the data that they know about their subscribers and when they did or did not renew their subscription.”
“If you use an Apple product, usually people increase prices because they assume that if you have an iPhone, you may have a higher income than if you have an Android,” Cian continued. “They know exactly from your IP address where you are reading most of the time, so they can access through Zillow how much is the average cost of a house in that area [and] probably infer really quickly your income.”
It’s likely how much readers use the Post will factor in how much they have to pay up. Read a lot, and the algorithm will determine that the customer values the paper “so we can charge them a little bit more”; read only every now and then, “maybe you don’t want to affect their pricing too much, because otherwise you stand to lose them.”
... continue reading