“Big Brother Meets Big Business”: Senate Leader Calls on FTC to Investigate “Dynamic Pricing”

US Senate Minority Leader Chuck Schumer has sent a letter calling on regulators to investigate the potential practice of setting airfares based on the details of passengers’ personal information.

Senator Chuck Schumer has taken notice of news that airlines are looking to tailor fares offered to each passenger based on travel habits, brand loyalty, demographic information and their willingness and ability to pay the asked-for price. The powerful Democrat from New York says he has sent a letter to Acting Federal Trade Commission (FTC) Chairman Maureen Ohlhausen urging the agency to investigate the controversial practice.

“This is ‘Big Brother’ meets ‘Big Business’ and it is a frightening combo for already-price badgered airline travelers,” Schumer told federal regulators in the the official correspondence obtained by The New York Daily News. “The airlines have already monetized every single inch of the plane: smaller seats, less food, charges for carry-ons, and so the thought that they or others within the travel industry are looking to nickel and dime consumers based on their mobile phone or computer’s browser history is a sad state of affairs that just might violate consumer protections.”

According to a recent Charlotte Observer report, the sort of dynamic pricing technologies that have caused concern for the lawmaker could amount to de facto “surge pricing” for some air travelers. Flyers using a corporate credit card, for example, could see only airfares that are priced substantially higher than those presented to a first time flyer or leisure traveler.

The Senate Minority Leader says that when it comes to setting different prices for different customers, the aviation industry might just be a canary in a coal mine. He explained that if the sort of invasive pricing scheme that relies on personnel and demographic information proves lucrative for airlines, then the practice could quickly spread to other consumer industries.

“When it comes to finding ways to monetize every atom of the traveling experience, few industries are better than the airlines,” Schumer warns. “So, we must take the very real concern for the use of this latest version of traveler tracking straight to the FTC before it inches mainstream.”

[Photo: Shutterstock]