FTC probes companies on ‘surveillance pricing’

Jul 24

Karah Rucker Anchor

By Karah Rucker (Anchor), Shea Taylor (Producer), Jake Maslo (Video Editor)

The Federal Trade Commission (FTC) is looking to figure out how artificial intelligence (AI) impacts consumer prices. Specifically, the agency is looking into “surveillance pricing.”

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Surveillance pricing is when technology is used to analyze consumer data to set prices for things, which the FTC says allows companies to charge different customers different prices. It uses people’s location, credit history and their device type — as well as their browsing and shopping history — to individualize prices.

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The FTC said it is not clear what algorithms and models drive the pricing strategy, and it is concerned companies are getting their information by surveilling users’ online footprints. The agency is now looking to get information from big companies like JPMorgan Chase and Mastercard for the review.

The FTC said this probe comes in response to recent reports that more retailers and grocery stores appear to be using algorithms to set targeted prices for customers.

Tags: Artificial Intelligence, Chase Bank, Federal Trade Commission, Inflation, JPMorgan, Surveillance, Tech, Technology

[KARAH RUCKER]

THE FEDERAL TRADE COMMISSION IS LOOKING TO FIGURE OUT HOW ARTIFICIAL INTELLIGENCE IMPACTS CONSUMER PRICES.

SPECIFICALLY, THEY’RE LOOKING INTO WHAT’S CALLED “SURVEILLANCE PRICING” – WHICH IS WHEN TECHNOLOGY IS USED TO ANALYZE CONSUMER DATA TO SET PRICES FOR THINGS… WHICH THE FTC SAYS ALLOWS COMPANIES TO CHARGE DIFFERENT CUSTOMERS DIFFERENT PRICES.

SURVEILLANCE PRICING USES PEOPLE’S LOCATION, CREDIT HISTORY, AND THEIR DEVICE TYPE – AS WELL AS THEIR BROWSING AND SHOPPING HISTORY – TO INDIVIDUALIZE PRICES.

THE FTC SAYS IT’S NOT CLEAR WHAT ALGORITHMS AND MODELS DRIVE THE PRICING STRATEGY – AND THEY’RE CONCERNED COMPANIES ARE GETTING THEIR INFORMATION BY SURVEILLING PEOPLE’S ONLINE FOOTPRINTS.

THE AGENCY IS LOOKING TO GET INFORMATION FROM BIG COMPANIES LIKE J-P MORGAN CHASE AND MASTERCARD FOR THE REVIEW.

THE FTC SAYS THIS COMES IN RESPONSE TO RECENT REPORTS THAT MORE RETAILERS AND GROCERY STORES APPEAR TO BE USING ALGORITHMS TO SET TARGETED PRICES FOR CUSTOMERS.