The Federal Trade Commission (FTC) has initiated an investigation into several major corporations regarding their handling of customer data, algorithms, and artificial intelligence to customize pricing for consumers.
On Tuesday, the FTC issued orders to eight companies—Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros—seeking detailed information about how these practices impact privacy, competition, and consumer protection.
These companies engage in a pricing strategy referred to as “surveillance pricing” or “dynamic pricing,” which allows them to offer different prices for the same products based on various factors related to the consumer, including location, demographic information, credit history, and online behavior.
Many of the firms under investigation provide transaction, sales, and pricing services to major U.S. and global companies. For example, Task Software supports significant hospitality brands such as McDonald’s and Starbucks, while Revionics delivers retail price optimization tools to chains like Home Depot. Pros, which markets AI-enhanced pricing solutions, serves clients including Nestlé, HP, and United Airlines and collaborates with Microsoft on technology development.
The FTC aims to uncover the complexities of this “opaque market” where consumer categorization enables targeted pricing strategies.
FTC Chair Lina Khan remarked, “Firms that harvest Americans’ personal data can put people’s privacy at risk. Now firms could be exploiting this vast trove of personal information to charge people higher prices. Americans deserve to know whether businesses are using detailed consumer data to deploy surveillance pricing, and the FTC’s inquiry will shed light on this shadowy ecosystem of pricing middlemen.”
The agency’s investigation focuses on four primary areas: the types of surveillance pricing products and services offered by each company; data collection methods; customer and sales information; and the ways these practices affect the final prices customers pay.