A Price Just for You, Specifically

New York Times

a day ago

Imagine that an airline notices you've booked a five-star hotel, so it charges you more for your ticket than it would have if you had booked a four- or three-star hotel. That's the vision of personalized pricing, a concept that has for years intrigued companies and enraged consumer advocates.
While consumer backlash may still give companies pause, some roadblocks to widespread use of the strategy may be clearing.
The Trump administration introduced a plan this week to clear the way for A.I. innovation, reinforcing its embrace of A.I. and raising questions about whether inquiries into the practice that Biden-era regulators started will be given any priority. At the same time, the technology has developed at a rapid pace.
'It's going to be: Whatever you can get away with, it's legal,' Robert W. Mann, an independent airline industry analyst and former airline executive, told DealBook. When it comes to regulatory scrutiny, he added, 'from curious to none is probably the transition.'
Delta Air Lines promoted its plans this month to ramp up its use of A.I. to set prices. And while it's not clear what data the airline is using — and whether it constitutes personalized pricing — privacy experts and industry analysts say many companies may see an opportunity to open what they've long considered to be an untapped gold mine.
Delta has been met with swift backlash. It said on its latest earnings call that it was working with Fetcherr, an A.I. start-up, and planned to use A.I. to price 20 percent of domestic routes by the end of this year. But it has pushed back against claims that it's turning to 'personalized' pricing. In a statement, it said it was leaning into new technology to streamline existing dynamic pricing models, which are based on market factors, not personal information.
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