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Only deal in town

Technology | In at least some cases online pricing has three rules—location, location, location

Does this sound fair? You visit Staples.com, search for a stapler, and purchase a decent-looking black Swingline for $15.79. Your cousin, who lives a few towns over, decides to buy the same stapler from the same website, but only pays $14.29. The only reason for his $1.50 in savings is the ZIP code he ordered from.

Unknown to many armchair shoppers, online stores have begun to display prices or products based on a computer user’s geographic location or browsing habits. The Staples pricing scheme was discovered by a recent Wall Street Journal investigation that simulated visits to Staples.com from over 42,000 U.S. ZIP codes, testing the price of the same stapler from each. Among several Staples products tested, advertised prices differed by about 8 percent, on average, depending on the web browser’s location.

The Journal concluded the primary reason some Staples.com shoppers see a discount is because they live near other office stores, like OfficeMax: Staples.com seems to be selectively lowering prices to compete with local storefronts.

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The investigation found other stores varying online prices, too. The websites of Lowe’s and The Home Depot offered products discounted in some cities, while not in others. The Home Depot said it uses shoppers’ computer IP addresses to estimate their location and display prices aligned with those at the nearest Home Depot storefront.

The nature of the internet allows websites to raise or lower product prices from hour to hour in response to competitors or market dynamics. Online prices for airplane tickets, for instance, fluctuate wildly based on the day of the week. Customers expect stores to adjust prices in order to compete, but it strikes many online shoppers as unfair to be charged more for a mail-order product simply because of where they live (shipping costs excluded). That’s especially true if the discrepancy is undisclosed.

On the other hand, price discrepancies are essential gears of competition in a free market. If you find yourself complaining about your online shopping cart total, remember: The web store next door is open, too.

Freebie U.

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Just when you thought online schooling couldn’t be cheaper, a California company called UniversityNow has begun providing college degrees for free. The company’s accredited online schools, New Charter and Patten universities, offer bachelor’s degrees in business and charge no more than a student’s employer is willing to reimburse for school expenses. Scholarships cover any additional cost so the student pays nothing. Only hitch: The cities of Oakland, Sacramento, and San Francisco are partners in the program, so students must live or work there to qualify. —D.J.D.

Sales launch

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A defense spending bill President Obama signed in January will allow U.S. companies to sell satellite technology abroad for the first time in over a decade. Conservatives in Congress effectively banned exports of commercial communications satellites in 1999, arguing China or other foreign powers could learn technological secrets from spacecraft components.

Since then, the U.S. satellite industry has shrunk, and foreign satellite makers have gained a competitive advantage. Obama promised during the 2008 campaign to roll back the export restrictions. The new law removes communications satellites from the State Department’s weapons list, while continuing to block sales to nations like Iran, North Korea, and China—an exclusion Chinese media sharply criticized in January. —D.J.D.

Daniel James Devine
Daniel James Devine

Daniel is a reporter for WORLD who covers science, technology, and other topics in the Midwest from his home base in Indiana. Follow Daniel on Twitter @DanJamDevine.

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