New York state law takes aim at personalized pricing

Source: TechCrunch

Overview

New York’s latest state budget introduces disclosure requirements for businesses that use personal data to set different prices for different shoppers—for example, charging more to customers with a history of splurging.

Disclosure Requirement

Businesses that employ personalized pricing must now inform customers with a statement such as:

“This price was set by an algorithm using your personal data.”

(Reported by The New York Times.)

Industry Response

• Uber: A spokesperson told the NYT that the company is showing the disclosure to New Yorkers. The spokesperson described the law as “poorly drafted and ambiguous,” insisting that Uber’s dynamic pricing relies only on geography and customer demand.
• National Retail Federation: Filed a lawsuit seeking to block the law. A federal judge, however, allowed the legislation to proceed.

Commentary

Lina Khan, former chair of the Federal Trade Commission and co‑chair of the mayoral transition team for Zohran Mamdani, told the NYT that the law will be an “absolutely vital” tool for the government. She also noted that there is “ton more work to be done” to regulate personalized pricing practices.