Surveillance Pricing vs. Dynamic Pricing: What Companies Need to Know
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Surveillance Pricing vs. Dynamic Pricing: What Companies Need to Know
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The strongest defense when the government asks questions is knowing your answers beforehand. In this episode of "Clearly Conspicuous," Anthony DiResta interviews his colleague Benjamin Genn of the Firm's Consumer Protection Defense and Compliance Team about the increasing scrutiny of surveillance pricing and how it differs from lawful dynamic pricing. After explaining the distinction between these two pricing models, Mr. Genn highlights a major airline's response to a congressional inquiry regarding its use of artificial intelligence (AI) in flight pricing. When three senators demanded answers about the airline's plans to expand AI use in flight pricing, the airline addressed lawmakers' concerns by producing documentation showing its systems use aggregate demand signals rather than individualized personal data. This example underscores the importance of understanding and documenting pricing algorithms and loyalty program data flows before inquiries arise from Congress, the Federal Trade Commission (FTC) or state attorneys general.