The FTC has sent mandatory notices for information to eight companies it says engages in “surveillance pricing”, the process by which prices are rapidly changed using AI based on data about customer behavior and characteristics. This process, the FTC claims, allows companies to charge different customers different prices for the same product.
The list includes Mastercard, JPMorgan Chase, Accenture and consulting giant McKinsey. It also includes software firm Task, which counts McDonald’s and Starbucks as clients; Revionics, which works with Home Depot, Tractor Supply and grocery chain Hannaford; Bloomreach, which services FreshDirect, Total Wine and Puma; and Pros, which was named Microsoft’s internet service vendor of the year this year. “Firms that harvest Americans’ personal data can put people’s privacy at risk,” FTC Chair Lina Khan said in a news release. “Now firms could be exploiting this vast trove of personal information to charge people higher prices.”
I’m not okay with companies charging different prices to different people, with a few exceptions like discounts for low-income people. Adjusting prices to squeeze the maximum amount of money from each individual should be illegal, and IIUC, it is in the EU.
There is a simple way to prevent this. Make it illegal to change the price of an item more than once a day. It completly kills these dynamic pricing schemes.
Some states already have these rules on the books to prevent price gouging during emergencies, but we need a federal law for it.
Doing something similar for stocks would effectively ban high frequency trading, which I’d be all for as it’s really just automated insider trading.