The price of your phone: How device-based pricing is quietly widening the digital divide
differential pricing quietly infiltrates the digital economy.
The image going viral on social media-showcasing a prominent ride hailing service's fare disparity based on device type-is a stark reminder that the smartphone you use has become an indicator of how much you are charged. This practice, not limited to ride-hailing apps, extends to q-comm platforms, where the cost of groceries or delivery services can subtly shift based on perceived consumer affluence. It's an opaque-and arguably discriminatory-trend that demands scrutiny.
At the heart of this issue is algorithmic pricing, a powerful tool in the arsenal of tech firms. These analyse consumer data-from purchasing history and location to device type and spending patterns. Ostensibly, the goal is to optimise pricing to maximise profits. But the process often veers into discriminatory territory. An iPhone signals a consumer's purchasing power, leading the algorithm to nudge prices higher under the assumption that such users are willing to pay more.
While companies might argue that this is a form of personalised pricing, reality is murkier. Personalised pricing should ideally be rooted in offering discounts to loyal users, or tailoring packages to individual needs. However, when pricing starts to reflect assumptions about wealth based on device type, it moves into a realm of economic profiling that is unethical and regressive.
For consumers, this feels exploitative. India is a price-sensitive market where even small variations in cost can impact purchasing
