Airline’s New Pricing Strategy Involves Spying on You - and It’s Sparking Backlash

There’s been a lot of discussion recently about A.I. (aka artificial intelligence). There’s an ongoing controversy about A.I. models using books, artwork, movies, etc., without the owner’s consent, that even Disney has recently weighed in on after filing a lawsuit against the A.I. company Midjourney.

One airline, Delta, has also sparked controversy by planning to use A.I. to determine ticket pricing, and U.S. lawmakers have already spoken out against those plans, according to NBC News.

Delta Airlines is coming under fire after plans were unveiled for its use of A.I. to set ticket prices. Delta recently made comments that it wanted to use A.I.-based revenue management across 20% of its U.S. network by the end of the year in a partnership using Fetcherr, an A.I. pricing company. Basically, the airline has explained it would use the technology to set fares based on predictions of “the amount people are willing to pay for the premium products related to the base fares.”

A letter written by Senators Ruben Gallego, Mark Warner, and Richard Blumenthal stated:

“Delta’s current and planned individualized pricing practices not only present data privacy concerns, but will also likely mean fare price increases up to each individual consumer’s personal ‘pain point’ at a time when American families are already struggling with rising costs.”

Delta, though, insists that it does not have plans to target customers with individualized offers based on their personal information. However, the airline has used dynamic pricing for over 30 years, which means that prices fluctuate on demand. The airline wants to use A.I. for dynamic pricing to get rid of the manual processes that currently determine those prices, but Delta continued to stress that all customers would see the same fares and offers.

Earlier this year, Blumenthal, as well as Senators Maggie Hassan and Josh Hawley, asked Frontier Airlines and Spirit Airlines about using customers’ personal information to charge different prices for the same seats on the same flight.

Check back with AllEars again soon for more.