6 ms·

FTC launches probe into 'surveillance pricing'

163 points by m463 2y ago

SoullessSilent 2y ago
Some form of this (without AI) has been practiced in the past. How does one get around this? Remote hosted disposable web browser instance and add items to non logged in cart then login once you see the prices so the offline cart is merged to your account? Does anyone know a reliable method?
- sadboi31 2y ago
  No because the pricing is based on the perception of actual person/distinct (lived) personality. It's hard to capture these things in a purely headless way. You need to feed realistic sensor(wifi/bt/mic) data + location data (gps + wifi) to get accurate ads. Without doing anything illegal and without broadcasting your intent on trying to espouse something criminal maybe pretend to have an affair (and encourage others to pretend to do the same or similar). Separate communication apps on disposable visa, different google playstore account, different phone number, etc#. Trust that wifi+bluetooth+cellular proximity will link the phones together. After a few weeks-months that second phone should be the similar enough to their actual profile for you to setup a remote residential proxy (w/ effective split tunnelling setup) for other people to funnel unique but similar requests through.
  - fragmede 2y ago
    It's also depends on where you come from. The price if you go to the airline's website directly may not match what you'd get off you come in via http://flights.google.com http://flights.google.com or http://expedia.com http://expedia.com or http://kayak.com http://kayak.com or whomever.
    - mrkstu 2y ago
      I saw a post on the eBay subreddit from a seller regarding shipping. They looked at the price to ship the item through eBay, popped off to a third party shipper to price compare- when they came back to eBay it quoted a new lower price.
llamaimperative 2y ago
Odd Lots (an excellent Bloomberg podcast) recently did a great episode on this topic: https://www.bloomberg.com/news/audio/2024-06-03/odd-lots-how-companies-got-smarter-about-price-hikes-podcast https://www.bloomberg.com/news/audio/2024-06-03/odd-lots-how... Lina Khan's FTC continues to look where attention is warranted. I'm not sure there's anything necessarily bad going on here, or presumably there's some bad/some good, but it's definitely something that regulators should be paying close attention to. Tech + data enables totally new and very opaque pricing schemes.
- datavirtue 2y ago
  Outlaw it so you don't regulatory resources. This is about companies dynamically setting (increasing) prices based on the demographics of the user. This is anti-market activity.
  - trod123 2y ago
    At its core, it is price fixing, and already technically illegal. There is no sound argument that can be made that weights in AI software programed in don't have biases created by human's, and won't ever engage in illegal activity. They are just trying to make the argument, its not illegal because an AI does it. We have already seen how Amazon uses their bait and switch algorithms (dynamic pricing) and there is more to learn about with regards to Project Nessy. It is anti-consumer activity, which can only occur in concentrated business sectors (oligopoly/monopoly).
    - fuzzfactor 2y ago
      >At its core, it is price fixing Sounds more like price variation to me. >It is anti-consumer activity Roger, maybe even worse.
      - ryandrake 2y ago
        I think OP means "price gouging" rather than fixing. Or, if you're a libertarian and want a positive spin, "increasing prices to exactly what the market will bear".
bitcurious 2y ago
This is excellent; surveillance pricing means the death of a competitive free market. Imagine if your airline knew precisely how badly you needed to be at your destination and knew your $ net worth. Flying to your father’s funeral? That’ll be 20k. Flying for cancer treatment? 30k.
- fragmede 2y ago
  United used to offer a discount for bereavement or medical emergency flights but they stopped doing that in 2015.
- wesselbindt 2y ago
  While I agree with you completely that this is absolutely undesirable, I don't see the relation to competition. Competition between airline carriers still exists no? Delta might charge 20k, and United might charge you 19k or whatever. Seems like competitive market to me. Shitty sure, but shitty and competitive are not mutually exclusive.
  - 63stack 2y ago
    It's also a field where it's practically impossible for a new player to enter. It is just as likely that the airlines will form a cartel, and fix the prices. Then if you are lucky, some kind of regulation will be introduced or the government will crack down on it in some ways after 5-10 years, they will be fined for 10% of the profits, and a promise not to do that again.
    - wesselbindt 2y ago
      Entirely correct, and not a consequence of surveillance pricing.
pedalpete 2y ago
The way I see it, pricing for market demand is fine, pricing for individual demand is not, particularly when the pricing is blind to the user. It's already a bit strange when I'm on a plane and know the person sitting next to me paid 1/2 what I did, and they're aggressively stealing the arm-rest. It's different when the airline says "we know you were looking for a flight on this day and time because you checked twice before buying a ticket, so each time you checked, we increased the price, because we figured you were more likely to buy. This example has nothing to do with the market, it's strictly targeting me as an individual. I had an experience with Uber where I cut myself and had to get stitches, so put my destination as a local hospital. Instant 3x surge pricing, but what am I going to do, bleed out? I got in the car and the driver said "I was about to switch off because it's been completely dead all night." It was immediately obvious to me that Uber would go "oh, you need to go to the hospital, you'll pay more", preying on the need.
- gruez 2y ago
  >It was immediately obvious to me that Uber would go "oh, you need to go to the hospital, you'll pay more", preying on the need. I just tried this and can't replicate. While it's possible that uber was preying on the fact you had an emergency, it's equally likely it was a coincidence. Moreover, "this guy is going to a hospital so let's charge him more because he's probably going to bleed out" is a pretty poor strategy. Besides the obvious PR risk, most people going to the hospital probably aren't bleeding out or in any sort of emergency. Think of the last time you were at a hospital. How many cars are in the parking lot vs waiting in the emergency room? It's far more likely that you're there for non-emergency reasons (eg. visiting a someone, going to an appointment, or work there), and charging 3x surge pricing is a good way of losing the fare to a competitor.
  - lelandfe 2y ago
    “I can’t replicate” does not disprove the behavior. Reddit blocks me from loading almost any post while logged out[0], faking that they’re NSFW. The person next to me does not have this “feature.” I believe companies use feature flagging in this way (for years!) to avoid scrutiny of these dark patterns. You, of course, may also be right that it was coincidence. [0] https://imgur.com/a/49dGCnX https://imgur.com/a/49dGCnX
toofy 2y ago
surveillance pricing is such a bleak future. pull up to a fuel pump, price boxes above the individual fuel hoses say “To learn pricing, for your convenience, please scan your phone’s NFC chip so we can determine your personal income and economy-wide purchase history.” “Oh, it looks like you’re in the mor17-36-97wcmyoal-93 pricing group!” “However, our scan indicates there are 2 other individuals in your automobile. To ensure an accurate pricing model, for your convenience please scan person1 and person2 mobile NFC chips.” “Oh, we see passenger number 3 is in raf79-93-18hswcpfu—32 pricing. Thank you! “Unfortunately, we’re unable to determine passenger 2’s income and economy-wide purchase history due to their lack of NFC ID. For your convenience please see teller inside for pricing options.” “If you question the validity of our estimations, please send a certified postal letter to our headquarters with the price ids previously shown on screen during the passenger scans. (The postal mailing address can be conveniently received by request from welovecustomers@fuelUSA.com Please allow 6-8 weeks for processing and we’ll get that postal address to you in a timely manner.) just let me fuel my car… please… onto the grocery store we go… “Please open our convenient app and scan the item for pricing.” … “This app requires the permissions…” and just for the record, since some or our tech monarchs fail to tell the difference, this is dystopian, bad. not good. this is not a “neat future.” even if we throw some neon music on top, it’s still horrifying.
- gruez 2y ago
  You should tone the paranoia down a notch. Realistically speaking if they can't identify you they'll just give you a worse price. It makes absolutely no sense to refuse a sale.
  - toofy 2y ago
    i was being hyperbolic and sarcastic for the sake of illustrating a directional trend we seem to be barreling towards. my apologies if i didn’t go far enough to make it more obvious. my fault.
    - latentsea 2y ago
      I enjoyed it. It's certainly starting to feel that way on an emotional level sometimes at least.
dfgdgf 2y ago
It's about time the FTC took a closer look at surveillance pricing. The idea that companies could tailor prices based on personal data feels like something out of a dystopian novel. Does anyone else think this could lead to even more distrust in tech companies? Or is this a necessary step to keep up with the times? Either way, I'm curious to see how this plays out and what kind of regulations might come from it.
probably_wrong 2y ago
Somewhat ironic that the GDPR pop-up lets me know that my information will be shared with up to 797 partners. Are you the kind of person who reads articles against airline pricing? That means you're probably not a loyal customer and therefore we'll charge you extra.
simpaticoder 2y ago
Potentially a scourge, but there is one area where such a pricing scheme makes sense: fines. Charging wealthy people the same as a poor person for a traffic violation, for example, is arguable justice. The fine is not a deterrent for the wealthy, and it is potentially life-changing for the poor person, as if they don't pay they will get a warrant and jail time. The legislators who set fine levels have some image of "average person" in mind when they do so; this simple approach is quickly invalidated when wealth distribution changes from normal to power-law.
- m463 2y ago
  Sure, tie it into the police radar gun to up your roi.

163 points by m463 2y ago

Some form of this (without AI) has been practiced in the past. How does one get around this? Remote hosted disposable web browser instance and add items to non logged in cart then login once you see the prices so the offline cart is merged to your account? Does anyone know a reliable method?

sadboi31 2y ago
No because the pricing is based on the perception of actual person/distinct (lived) personality. It's hard to capture these things in a purely headless way. You need to feed realistic sensor(wifi/bt/mic) data + location data (gps + wifi) to get accurate ads. Without doing anything illegal and without broadcasting your intent on trying to espouse something criminal maybe pretend to have an affair (and encourage others to pretend to do the same or similar). Separate communication apps on disposable visa, different google playstore account, different phone number, etc#. Trust that wifi+bluetooth+cellular proximity will link the phones together. After a few weeks-months that second phone should be the similar enough to their actual profile for you to setup a remote residential proxy (w/ effective split tunnelling setup) for other people to funnel unique but similar requests through.
- fragmede 2y ago
  It's also depends on where you come from. The price if you go to the airline's website directly may not match what you'd get off you come in via http://flights.google.com http://flights.google.com or http://expedia.com http://expedia.com or http://kayak.com http://kayak.com or whomever.
  - mrkstu 2y ago
    I saw a post on the eBay subreddit from a seller regarding shipping. They looked at the price to ship the item through eBay, popped off to a third party shipper to price compare- when they came back to eBay it quoted a new lower price.

llamaimperative 2y ago

Odd Lots (an excellent Bloomberg podcast) recently did a great episode on this topic: https://www.bloomberg.com/news/audio/2024-06-03/odd-lots-how-companies-got-smarter-about-price-hikes-podcast https://www.bloomberg.com/news/audio/2024-06-03/odd-lots-how... Lina Khan's FTC continues to look where attention is warranted. I'm not sure there's anything necessarily bad going on here, or presumably there's some bad/some good, but it's definitely something that regulators should be paying close attention to. Tech + data enables totally new and very opaque pricing schemes.

datavirtue 2y ago
Outlaw it so you don't regulatory resources. This is about companies dynamically setting (increasing) prices based on the demographics of the user. This is anti-market activity.
- trod123 2y ago
  At its core, it is price fixing, and already technically illegal. There is no sound argument that can be made that weights in AI software programed in don't have biases created by human's, and won't ever engage in illegal activity. They are just trying to make the argument, its not illegal because an AI does it. We have already seen how Amazon uses their bait and switch algorithms (dynamic pricing) and there is more to learn about with regards to Project Nessy. It is anti-consumer activity, which can only occur in concentrated business sectors (oligopoly/monopoly).
  - fuzzfactor 2y ago
    >At its core, it is price fixing Sounds more like price variation to me. >It is anti-consumer activity Roger, maybe even worse.
    - ryandrake 2y ago
      I think OP means "price gouging" rather than fixing. Or, if you're a libertarian and want a positive spin, "increasing prices to exactly what the market will bear".

bitcurious 2y ago

This is excellent; surveillance pricing means the death of a competitive free market. Imagine if your airline knew precisely how badly you needed to be at your destination and knew your $ net worth. Flying to your father’s funeral? That’ll be 20k. Flying for cancer treatment? 30k.

fragmede 2y ago
United used to offer a discount for bereavement or medical emergency flights but they stopped doing that in 2015.
wesselbindt 2y ago
While I agree with you completely that this is absolutely undesirable, I don't see the relation to competition. Competition between airline carriers still exists no? Delta might charge 20k, and United might charge you 19k or whatever. Seems like competitive market to me. Shitty sure, but shitty and competitive are not mutually exclusive.
- 63stack 2y ago
  It's also a field where it's practically impossible for a new player to enter. It is just as likely that the airlines will form a cartel, and fix the prices. Then if you are lucky, some kind of regulation will be introduced or the government will crack down on it in some ways after 5-10 years, they will be fined for 10% of the profits, and a promise not to do that again.
  - wesselbindt 2y ago
    Entirely correct, and not a consequence of surveillance pricing.

pedalpete 2y ago

The way I see it, pricing for market demand is fine, pricing for individual demand is not, particularly when the pricing is blind to the user. It's already a bit strange when I'm on a plane and know the person sitting next to me paid 1/2 what I did, and they're aggressively stealing the arm-rest. It's different when the airline says "we know you were looking for a flight on this day and time because you checked twice before buying a ticket, so each time you checked, we increased the price, because we figured you were more likely to buy. This example has nothing to do with the market, it's strictly targeting me as an individual. I had an experience with Uber where I cut myself and had to get stitches, so put my destination as a local hospital. Instant 3x surge pricing, but what am I going to do, bleed out? I got in the car and the driver said "I was about to switch off because it's been completely dead all night." It was immediately obvious to me that Uber would go "oh, you need to go to the hospital, you'll pay more", preying on the need.

gruez 2y ago
>It was immediately obvious to me that Uber would go "oh, you need to go to the hospital, you'll pay more", preying on the need. I just tried this and can't replicate. While it's possible that uber was preying on the fact you had an emergency, it's equally likely it was a coincidence. Moreover, "this guy is going to a hospital so let's charge him more because he's probably going to bleed out" is a pretty poor strategy. Besides the obvious PR risk, most people going to the hospital probably aren't bleeding out or in any sort of emergency. Think of the last time you were at a hospital. How many cars are in the parking lot vs waiting in the emergency room? It's far more likely that you're there for non-emergency reasons (eg. visiting a someone, going to an appointment, or work there), and charging 3x surge pricing is a good way of losing the fare to a competitor.
- lelandfe 2y ago
  “I can’t replicate” does not disprove the behavior. Reddit blocks me from loading almost any post while logged out[0], faking that they’re NSFW. The person next to me does not have this “feature.” I believe companies use feature flagging in this way (for years!) to avoid scrutiny of these dark patterns. You, of course, may also be right that it was coincidence. [0] https://imgur.com/a/49dGCnX https://imgur.com/a/49dGCnX

toofy 2y ago

surveillance pricing is such a bleak future. pull up to a fuel pump, price boxes above the individual fuel hoses say “To learn pricing, for your convenience, please scan your phone’s NFC chip so we can determine your personal income and economy-wide purchase history.” “Oh, it looks like you’re in the mor17-36-97wcmyoal-93 pricing group!” “However, our scan indicates there are 2 other individuals in your automobile. To ensure an accurate pricing model, for your convenience please scan person1 and person2 mobile NFC chips.” “Oh, we see passenger number 3 is in raf79-93-18hswcpfu—32 pricing. Thank you! “Unfortunately, we’re unable to determine passenger 2’s income and economy-wide purchase history due to their lack of NFC ID. For your convenience please see teller inside for pricing options.” “If you question the validity of our estimations, please send a certified postal letter to our headquarters with the price ids previously shown on screen during the passenger scans. (The postal mailing address can be conveniently received by request from welovecustomers@fuelUSA.com Please allow 6-8 weeks for processing and we’ll get that postal address to you in a timely manner.) just let me fuel my car… please… onto the grocery store we go… “Please open our convenient app and scan the item for pricing.” … “This app requires the permissions…” and just for the record, since some or our tech monarchs fail to tell the difference, this is dystopian, bad. not good. this is not a “neat future.” even if we throw some neon music on top, it’s still horrifying.

gruez 2y ago
You should tone the paranoia down a notch. Realistically speaking if they can't identify you they'll just give you a worse price. It makes absolutely no sense to refuse a sale.
- toofy 2y ago
  i was being hyperbolic and sarcastic for the sake of illustrating a directional trend we seem to be barreling towards. my apologies if i didn’t go far enough to make it more obvious. my fault.
  - latentsea 2y ago
    I enjoyed it. It's certainly starting to feel that way on an emotional level sometimes at least.

dfgdgf 2y ago

It's about time the FTC took a closer look at surveillance pricing. The idea that companies could tailor prices based on personal data feels like something out of a dystopian novel. Does anyone else think this could lead to even more distrust in tech companies? Or is this a necessary step to keep up with the times? Either way, I'm curious to see how this plays out and what kind of regulations might come from it.

probably_wrong 2y ago

Somewhat ironic that the GDPR pop-up lets me know that my information will be shared with up to 797 partners. Are you the kind of person who reads articles against airline pricing? That means you're probably not a loyal customer and therefore we'll charge you extra.

simpaticoder 2y ago

Potentially a scourge, but there is one area where such a pricing scheme makes sense: fines. Charging wealthy people the same as a poor person for a traffic violation, for example, is arguable justice. The fine is not a deterrent for the wealthy, and it is potentially life-changing for the poor person, as if they don't pay they will get a warrant and jail time. The legislators who set fine levels have some image of "average person" in mind when they do so; this simple approach is quickly invalidated when wealth distribution changes from normal to power-law.

m463 2y ago
Sure, tie it into the police radar gun to up your roi.