New Yorkās Latest State Budget Includes New Disclosure Requirements for Personalized Pricing
Businesses in New York that use personal data to set different prices for different shoppers will now have to disclose this practice to customers, according to a recent report by The New York Times. This new requirement is part of the stateās latest budget and aims to increase transparency in pricing strategies.
Under the new law, businesses utilizing personalized pricing algorithms must inform customers that āThis price was set by an algorithm using your personal data.ā This move is intended to give consumers more insight into how prices are determined and to prevent any potential discriminatory pricing practices.
While it remains unclear how widespread the use of personalized pricing is among online retailers, some companies like Uber have already started implementing the disclosure in compliance with the new regulations. Uber, for example, stated that it uses geography and customer demand, rather than personal data, to calculate its dynamic pricing.
However, not all businesses are in favor of the new law. The National Retail Federation has filed a lawsuit to block its enforcement, but a federal judge has ruled in favor of allowing the law to proceed. This decision marks a significant step towards holding businesses accountable for their pricing strategies.
Lina Khan, former chair of the Federal Trade Commission and current co-chair of the mayoral transition team for Zohran Mamdani, praised the new law as an āabsolutely vitalā tool for government oversight. She also emphasized the need for continued efforts to regulate and monitor the use of personalized pricing in the retail industry.
