FTC Demands Companies Provide Data On 'Surveillance Pricing'

The Federal Trade Commission has ordered eight companies to provide information on what it is calling “surveillance pricing.”

Surveillance pricing refers to third-party companies collecting consumer information—including browser history, credit history, location, demographics, and more—to build profiles that allow them to target consumers and charge higher profiles.

“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,” said FTC Chair Lina M. Khan. “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 eight companies the FTC has demanded information from include Mastercard, Revionics, Bloomreach, JPMorgan Chase, Task Software, PROS, Accenture, and McKinsey & Co.

The FTC wants information on the following areas:

• Types of products and services being offered: The types of surveillance pricing products and services that each company has produced, developed, or licensed to a third party, as well as details about the technical implementation and current and intended uses of this technology;
• Data collection and inputs: Information on the data sources used for each product or service, including the data collection methods for each data source, the platforms and methods that were used to collect such data, and whether that data is collected by other parties (such as other companies or other third parties);
• Customer and sales information: Information about whom the products and services were offered to and what those customers planned to do with those products or services; and
• Impacts on consumers and prices: Information on the potential impact of these products and services on surveilled consumers including the prices they pay.

The US lacks comprehensive privacy laws, unlike the EU, opening the door for companies to engage in predatory practices, including surveillance pricing. The Commission voted 5-0 to order the eight companies to turn over the information.

Hopefully, the FTC’s inquiry leads to better protections for consumer privacy.