FTC Demands Look at How Companies Use Your Data to Set Prices

The Federal Trade Commission said Wednesday it is ordering Delta Air Lines, Walmart, and other companies to provide detailed information on how they use consumers' data when setting prices. The commission said it is also studying how ride-sharing and delivery companies like Uber use their independent drivers' personal data when setting compensation rates. "We intend to scrutinize the opaque methodology that some companies in these industries may be using to determine how much consumers pay or how much gig workers are paid for the same product or service," FTC Chair Andrew Ferguson said. Orders were also issued to United, JetBlue, Lyft, DoorDash, Instacart, and Target, reports the AP.

Each company must share data that will allow the commission to assess whether pricing for tickets, rides, food delivery, or other products and services varies from one person to the next based on factors such as participation in loyalty programs or analysis of personal data. The FTC said it is also examining whether companies compensate workers based on personal data like their phone usage or history of accepting rides or deliveries. If the companies fail to turn over data, the FTC said it could compel compliance in federal court.

Some responses:

• Delta: It has "zero tolerance for discriminatory or predatory pricing" and fully complies with pricing and advertising laws.
• JetBlue: "Fares are determined by demand and seat availability, and all customers have access to the same fares."
• Instacart: The grocery delivery company said compensation for shoppers is based solely on distance traveled, number of items, and expected shopping time. Nor does it use consumers' personal information to set prices. "We will continue engaging with policymakers and regulators to ensure they understand how pricing on our platform works."

The FTC's actions reflect customers' increasing concerns about pricing technology and the use of AI to collect vast amounts of data. Legislators in at least 30 states have considered pricing-related bills this year, including measures addressing algorithmic and personalized pricing, according to the National Conference of State Legislatures.