Senate hearing examines how companies could use AI and personal data to set individualized prices
U.S. Senator Josh Hawley on Wednesday convened a Senate hearing focused on growing concerns over “surveillance pricing,” a practice in which companies allegedly use artificial intelligence, browsing behavior, location data, purchase history, and other personal information to charge different prices to different consumers for the same product or service.
Hawley described the practice as “one of the biggest scams in American history,” arguing that advances in AI have made it easier for businesses to analyze vast amounts of consumer data and adjust prices in real time based on an individual’s willingness or ability to pay.
Experts warn AI could accelerate personalized pricing
During the hearing, a panel of technology executives, economists, consumer advocates, and privacy experts testified that AI systems are increasingly capable of building detailed consumer profiles by combining data from online searches, mobile apps, loyalty programs, social media activity, and past purchases.
Several witnesses warned that these tools could enable companies to move beyond traditional dynamic pricing such as airline or hotel price changes based on demand toward highly individualized pricing models that may be difficult for consumers to detect or challenge.
Consumer advocates argued that such systems could lead to higher prices for vulnerable groups, including low-income households, elderly consumers, and people living in areas with limited competition. They also raised concerns about the lack of transparency surrounding how AI algorithms make pricing decisions.
Industry representatives defend data-driven pricing
Industry representatives at the hearing said data-driven pricing is already widely used across many sectors and can help companies manage inventory, respond to market conditions, and offer targeted discounts to some customers. They maintained that personalized offers are not necessarily harmful and can sometimes result in lower prices or more relevant promotions for consumers.
However, lawmakers from both parties questioned whether consumers are being given meaningful notice or consent when their personal data is used to influence the prices they see online. Senators also explored whether existing consumer protection, antitrust, and privacy laws are adequate to address AI-driven pricing practices.
Federal scrutiny likely to increase
The hearing reflects a broader push in Washington to examine how artificial intelligence is affecting competition, consumer rights, and data privacy. The Federal Trade Commission (FTC) has previously warned companies against using algorithms in ways that could result in unfair, deceptive, or discriminatory pricing practices, and lawmakers signaled that additional federal oversight may be considered if evidence emerges that AI systems are being used to exploit consumers.
No new legislation was announced during the hearing, but Hawley said Congress must ensure that Americans are not subjected to “secret AI-driven price manipulation” based on extensive personal surveillance. The debate is expected to continue as regulators, lawmakers, and technology companies grapple with the rapidly expanding role of AI in digital commerce and consumer pricing.
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