McDonald’s and Walmart Are Part of the Widening Fray Over Surveillance Pricing
The Federal Trade Commission has urged companies to be transparent about their pricing, but that may not be enough.
The ongoing controversy surrounding companies' use of AI to set prices has recently expanded to include major American brands like McDonald's and Walmart. The debate over surveillance pricing, which involves setting prices based on individual customer data, has gained traction with recent reports of Walmart's patented technology for dynamic AI pricing and McDonald's shifting to AI systems that could result in different prices for the same products at different locations for different customers.
Walmart's CEO John Furner has attempted to allay public concerns, stating that factors like income, shopping history, urgency, or personal payment capacity will not influence the price. However, consumer advocates remain skeptical and have suggested that Walmart customers should leave their phones in their cars to avoid being data-mined.
Similarly, McDonald's has faced media criticism for its AI-driven pricing system, with the company dismissing the coverage as "speculative and misinformed." The company has not provided a response to requests for comment on the matter.
These developments have drawn attention from lawmakers, the Federal Trade Commission, and consumer advocacy groups, who are concerned about the potential for discriminatory or unlawful practices. The Consumer Federation of America has called for more robust regulations, arguing that surveillance pricing can disproportionately harm vulnerable populations, such as those with low incomes or working families.
While the Federal Trade Commission has invited public comment on policy regarding surveillance pricing, it has indicated that enforcing existing rules may be limited.
Written by urgent.news from CNET's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
