Commentary

New FTC Chair Cancels Comments On 'Surveillance Pricing'

The Federal Trade Commission late last week issued its preliminary “surveillance pricing” report, which examined the hidden techniques companies can use when determining how much to charge particular individuals.

When the FTC published the report, it sought input from consumers and businesses about how surveillance pricing had affected them.

New FTC Chair Andrew Ferguson evidently sees no need to receive those comments. Earlier this week, he withdrew the agency's request for information.

Commissioner Alvaro Bedoya on Thursday called attention to Ferguson's move, writing that one of his first acts as agency head was “to quietly remove the opportunity for the public to comment” on various topics, including surveillance pricing.

The report itself outlines potential pricing tactics that are opaque to most consumers.

For instance, according to the report, companies could collect “real-time information about a person’s browsing and transaction history,” and then decide whether to offer coupons based on assumptions derived from that data.

“A pharmacy could choose to exclude routine, regular customers in a special promotion for over-the-counter medications or weight-loss supplements because the pharmacy inferred that those customers are likely to buy those products anyway,” the FTC stated in the report, which it characterized as “research studies.”

“If a consumer is profiled as a new parent, the consumer may intentionally be shown higher priced baby thermometers on the first page of their in-app search results, based on their residential zip code and time of purchase,” the authors wrote.

Ferguson and Commissioner Melissa Holyoak dissented from the decision to release the report, arguing that it was premature.

“The Commission should allow staff to do its work and issue a final, fact-based report, rather than rush to meet a nakedly political deadline to present something, anything, to the public,” they stated last week.

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