New York’s recent state budget introduces new rules that require businesses using customer data for personalized pricing to disclose to customers that, “This price was set by an algorithm using your personal data.” According to The New York Times, this aims to address scenarios where prices vary based on individual spending habits.
While the prevalence of this pricing strategy among online retailers remains uncertain, Uber confirmed to the NYT that it has implemented this disclosure in New York. The company, however, criticized the law as “poorly drafted and ambiguous,” asserting that its dynamic pricing is influenced solely by geography and demand.
The National Retail Federation contested the legislation through a lawsuit, although a federal judge permitted its enforcement to proceed.
Lina Khan, former Federal Trade Commission chair and current co-chair of Zohran Mamdani’s mayoral transition team, views the law as an important governmental tool. However, she believes that additional efforts are necessary to regulate this pricing method effectively.
Source: TechCrunch