Written by Rachel Farrow
The latest season of Dom Beveridge’s Tech Talk With 20for20 dives deep and head-on into the contentious conversations surrounding multifamily revenue management. Through seven insightful episodes, industry leaders, legal experts, and innovators tackle the web of antitrust lawsuits, regulatory pressures, and their broader implications for the property management industry. Revenue Edge proudly sponsored this season, with our Founder and CEO joining a roundtable in the season finale.
We encourage you to listen to the series for yourself, but here is a list of our biggest takeaways:
Leading Up to the DOJ Lawsuit
In the first episode, Revenue Management - A GC’s Perspective, Beveridge starts the conversation by outlining the development of various revenue management lawsuits over the past two years. Jesse Strauss, a seasoned General Counsel with deep expertise in PropTech, joins him to break down the basis of these allegations and sheds light on how these suits differ.
The Timeline:
October 2022: ProPublica’s article spurs a series of class-action lawsuits. April 2023: Class-action lawsuits are assigned to Tennessee’s Middle District Court under one judge. November 2023: DOJ publishes a memorandum supporting the suits. January 2024: First state-level bill drafted in response to allegations (Colorado, unsuccessful). August 2024: San Francisco passes a revenue management ban (followed by Philadelphia in September). August 2024: DOJ files a civil antitrust lawsuit.
The basis for these developments is the claim that algorithmic pricing violates the Sherman Antitrust Act. Section 1 prohibits conspiracies to restrict trade, while Section 2 prohibits using one’s large market share to unfairly compete or push out competition.
Lawyers who brought on these private class-action lawsuits are doing so with a simple goal of settling for compensation that covers their fees and satisfies their clients. Both Beveridge and Strauss believe these cases will settle without admission of alleged wrongdoing from the revenue management company.
The state and federal cases, however, are motivated by policy change; reform aimed at protecting renters and landlords. Strauss notes that the government “tends to want the product to be shifted in such a way they believe is compliant.” So, it makes sense that we are seeing the removal of non-public data from these systems to satisfy the concerns around Section 1. However, Strauss highlights the uncertainty surrounding Section 2, as the government’s precedent for defining an appropriate market share is very subjective.
The Consequences
In the next 4 episodes, Beveridge continues to bring an impressive list of experts to discuss both the potential and inevitable implications of the DOJs unprecedented approach.
Ripple Effect Across Industries:
Episode 2: Jay Ezrielev, an antitrust law expert and former FTC economic advisor, calls the DOJ’s claims “dangerous” as they are ubiquitous in most B2B transactions, and the framework established in the DOJ’s memo fails to define a “limiting principle” making compliance hard to ensure. Ezrielev expresses that the DOJ’s claims are unprecedented and will “redefine what it means to share information.” Ezrielev suspects the DOJ wants to eliminate AI in revenue management altogether.
Episode 5: Ethan Glass, a first-chair antitrust trial lawyer and DOJ antitrust expert, argues that information-sharing is fundamental to the free market. Glass emphasizes the need for incentive-based legislation while warning against restrictive information-sharing policies.
Misinformation and Hindrance to Innovation:
Episode 3: Donald Davidoff, a revenue management systems veteran and original developer of LRO, explains the importance of knowing your revenue management system and how, in multifamily, models do not base pricing decisions solely on competitor data but place a heavier weight on supply and demand changes; further validating Beveridge’s reiterated point that the hub-and-spoke claims are “mathematically impossible” and “not even desirable.”
Episode 4: Remen Okoruwa, CEO of Propexo, shares his concerns from a tech and innovation perspective. Remen and Beveridge walk through the importance of data aggregation especially throughout rental markets and the clear aim of the government to limit it.
Where We Go from Here
Episodes 6 and 7 conclude the season with a comprehensive overview and a roundtable discussion featuring Revenue Edge CEO Stacy Westbay, REBA CRO Tim McInerney, and RADIX CEO Blerim Zeqiri. These episodes explore how the lawsuits are reshaping client conversations, operations, and growth strategies while emphasizing the importance of staying informed, adaptable, and vocal. Here are some of the key points each made:
Westbay:
Understand your platform and the importance of feeding it good data.
Acknowledge that revenue growth is impacted by far more than whether rents go up or down.
Should other, less robust platforms emerge, approach their claims cautiously; they may not be as effective as existing platforms even as the algorithms evolve.
McInerney:
Consider revenue management systems that have been screened for antitrust violations and approaching operations in the same way.
Stay informed and continue conversations internally to ensure you are staying engaged and educating others. Staying up to speed is made easier by subscribing to Google alerts for real-time industry news, PAC newsletters, and content from thought leaders.
Zeqiri:
Understand how you are using data and where the data is coming from.
Advocate for policies that foster competition, not restrict information sharing as this will inevitably disadvantage the parties the recent suits aim to protect.
Data companies should follow RADIX lead and ensure their information is transparent and accessible to all participants in the multifamily ecosystem, including renters. Not only because it is arguably more beneficial but repels scrutiny.
This season of Tech Talk with 20for20 underscores the multifaceted challenges and opportunities facing the multifamily industry. Revenue Edge clients are at an advantage, having access to unbiased expert guidance as the industry and revenue management technologies evolve.
Do you have thoughts or questions you’d like to share with us? Email rachel@revedgesps.com.