The Federal Trade Commission (FTC) has initiated an investigation into several major corporations concerning their use of customer data, algorithms, and artificial intelligence for personalized pricing strategies.
Eight companies from various sectors — including Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros — received subpoenas from the FTC on Tuesday. The agency seeks information regarding how these practices affect privacy, competition, and consumer protection.
These companies utilize data-driven tools, such as AI, to implement a strategy known as “surveillance pricing,” also referred to as “dynamic pricing.” This approach allows businesses to display varied prices for identical products based on customers’ characteristics or behaviors, including factors like location, demographics, credit history, and online activity.
Many of the firms under investigation are involved in providing transaction, sales, and pricing services to some of the largest companies in the U.S. and around the world. Task Software supports major hospitality businesses like McDonald’s and Starbucks in managing transactions. Revionics delivers retail price optimization software and pricing analytics to global chains including Home Depot. Pros, which specializes in AI-driven pricing solutions, serves clients such as Nestlé, HP, and United Airlines, and partners with Microsoft for technology development.
The FTC aims to clarify the workings of what it describes as an “opaque market” that categorizes consumers and applies targeted pricing for various products and services.
FTC Chair Lina Khan stated, “Firms that harvest Americans’ personal data can put people’s privacy at risk. Moreover, these companies could potentially exploit vast amounts of personal information to set higher prices.” She emphasized that Americans have a right to know if businesses are employing detailed consumer data to enact surveillance pricing, and that the inquiry seeks to expose this hidden network of pricing intermediaries.
The FTC has identified four primary areas of interest: the types of surveillance pricing products and services offered by each company, data collection methods, customer and sales information, and the impact of these surveillance practices on pricing for consumers.