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Palm Greasing Now Has an App

A Commentary by Froma Harrop

Tuesday, November 04, 2014

Uber, the car-summoning service, got some flak not long ago for "surge" pricing. Customers complained about its policy of raising prices charged for trips at times of high demand. That might happen on New Year's Eve, in the teeth of a monsoon or, less dramatically, during an especially busy lunch hour.

I never minded. Surge pricing seemed a fair way to deal with a short supply in a period of high demand. Those who badly wanted a ride would pay extra. And because the app clearly stated when surge pricing was in effect, the consumer could make an informed decision on whether or not to accept the deal.

Now we see Uber-like surge pricing applied to other things, such as restaurant reservations. For example, Resy, a table-booking app, tacks on an extra $20 or so for seating at prime-time hours. In effect, it's making diners bid for seats at hot restaurants.

That I do mind, and here's why: Restaurants are allegedly in the (SET ITAL) hospitality (END ITAL) business. Call me old-fashioned, but there ought to be at least an illusion that diners are welcome guests and expected to return -- not just wads of cash competing with other wads of cash.

Like Uber, the airlines raise prices at times of high demand. But these companies are offering simple transportation. However nice the Uber driver in a big city, it is highly unlikely you will ever see him again. This is not a business in which those who serve expect repeat customers.

So these are basically palm-greasing apps. Slipping the maitre d' a fiver (when $5 meant something) was

Apps sanitize the bribery by wrapping it in technology. This processing may work best for hip restaurants that have done away with tablecloths and waiters in uniforms -- and whose industrial design recalls a locker room at the Y. There's no suave way to slip a $20 bill to the hipster in jeans presiding in front. Hipsters may correct me.

Another app, called SeatMe, lets popular restaurants ping the supplicants when a table unexpectedly opens up. The presumption is that diners are on a kind of standby, waiting for the privilege of being granted a table. In addition, they so badly want to join the elect few that they're willing to rearrange their plans at the last minute.

Say this for the palm-greasing apps. They don't leave the players guessing how much they must bribe the restaurant for the special treatment. In their world, this is a dry business transaction.

What the apps give the restaurants in return is a share of the fee -- plus personal information they've collected about the customers. They also perform a welcome service: They penalize those bad people who don't show up for their reservations.

Oh, what some people would do for the perfectly cooked Brussels sprout in a new city. I, for one, would prefer a less perfect one in a warm setting. I'll pay more for better food, but not a cent in tribute for a celebrity chef. I'd just as soon have someone fat and friendly in the kitchen.

Jeff Ely, an economist at Northwestern University, told a reporter writing about these apps, "When you dine at a restaurant, you're getting two things: a table and the food." Paying separately for a reservation unbundles them.

The professor may be right about the unbundling part, but let me disagree with him on the other point. Restaurants offer three, not two, things: a table, food and hospitality. And the last item on that list -- personal kindness to one's patrons -- is a lot harder to monetize.

Follow Froma Harrop on Twitter @FromaHarrop. She can be reached at fharrop@gmail.com. To find out more about Froma Harrop and read features by other Creators writers and cartoonists, visit the Creators Web page at www.creators.com.

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