Last week I reported that Delta Air Lines launched a pilot program that uses AI to determine how much you personally will pay for a ticket, as opposed to offering static prices to all customers. The personalized pricing is currently in effect for 3% of fares, but the company aims to increase that to 20% by the end of the year.
This week the backlash has begun…
Democratic lawmakers have moved to ban what they call “predatory surveillance pricing” with the newly proposed “Stop AI Price Gouging and Wage Fixing Act” or “SAIPGWFA” for short (just kidding).
The bill would prohibit practices like an airline raising prices for a customer after seeing that they searched for a family obituary or a ride share app paying a driver less after seeing that they visited a pawn shop and thus may be more desperate for money.
Congressman Greg Casar (D-Texas) said:
“Giant corporations should not be allowed to jack up your prices or lower your wages using data they got spying on you. Whether you know it or not, you may already be getting ripped off by corporations using your personal data to charge you more. This problem is only going to get worse, and Congress should act before this becomes a full blown crisis.”
Advocacy group Public Citizen said:
“This bill draws a clear line in the sand: companies can offer discounts and fair wages—but not by spying on people. Surveillance-based price gouging and wage setting are exploitative practices that deepen inequality and strip consumers and workers of dignity. Public Citizen strongly supports this bill because it gives the FTC, EEOC, state attorneys general, and individuals the tools they need to stop these abuses and put power back where it belongs: with the people.”
I support the intentions of the bill, but enforcement may be difficult. After all, what's the difference between “offering a discount” and “jacking up prices” for two different customers? It's a fine line. The former simply means raising the base price for everyone.
On a deeper level, I argue that consumer privacy protection should be so STRONG in our country that the digital environment doesn't exist for Big Tech companies to be able to leverage our browsing history and online behavior to offer dynamic prices. However since that reality is not going to happen anytime soon, band-aid solutions like “SAIPGWFA” aren't a horrible idea, I guess.
What are your thoughts on the proposed act? Good for consumers? Over regulation?