Pluralistic: The stupidest imaginable excuses for surveillance pricing (30 Jul 2026) – Pluralistic: Daily links from Cory Doctorow

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The stupidest imaginable excuses for surveillance pricing: Since 1850, San Francisco's Chamber of Commerce has been pissing in our mouths and calling it rain.

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The stupidest imaginable excuses for surveillance pricing (permalink)

With "surveillance pricing," businesses have finally found something AI can do way, way, way better than people: price gouging.

As the name suggests, "surveillance pricing" is the practice of charging every customer a different price for every transaction, based on the massive surveillance dossiers that Big Tech companies and data-brokers have assembled on everyone in the world. Congress hasn't updated federal consumer privacy law since 1988 (when they passed a law banning the disclosure of VHS rentals), so pretty much any form of consumer surveillance is fair game.

This is where the AI comes in. One thing AI is indisputably great for is multivariate statistical analysis. You can feed an AI "behavioral data" (information about where you go, what you do, what you buy, who you talk to and what you say) about all of your customers and ask it to cluster them according to their shared traits. Then you can direct the AI to automatically run a series of small experiments to discover the maximum markup each group will stomach under which circumstances.

This works without you having to direct the AI to rip off certain groups of people – it will simply find the most vulnerable people and rip them off the most. If you're hiring in an industry that practices a lot of tacit racial discrimination, a system like this can figure out on its own that people of color typically accept lower wages because there are fewer employers bidding for their labor, and recommend lowball salary offers, all without you ever typing "please be racist" into your AI prompt.

This works so well that Google has announced that it is their plan for making a profit off of AI, after losing hundreds of billions of dollars on chatbots:

https://pluralistic.net/2026/01/21/cod-marxism/#wannamaker-slain

In the before times, marketers and demographers had to dream up demographic categories based on limited data and run focus groups to figure out how to maximize revenue from each market segment. Now an AI can segment the data to any degree you choose, and continuously, automatically experiment on each segment to find their weak spots.

It's "theory-free." You don't have to discover why a group is willing to pay more under a given set of circumstances, you merely have to observe and weaponize this fact. You don't have to know why one group of purchasers consistently accept higher prices between 6AM and 8AM – you can just automatically jack up prices on them without knowing or caring that you're gouging parents of young children who are re-ordering essential supplies while trying to get their kids to school in the morning.

I thought up that example. I don't know if it's really happening. But here's something that really is happening: ecommerce sites charge parents of newborns extra when they order thermometers in the middle of the night. I'm not saying that anyone ever sat down and said, "Parents with sick children will pay whatever we charge for a thermometer at 2AM." They didn't have to: this is the kind of thing an automated system can do without any human intervention:

https://www.ftc.gov/system/files/ftc_gov/pdf/p246202_surveillancepricing6bstudy_researchsummaries_redacted.pdf

The goal of surveillance pricing is to shift all the "consumer surplus" (the difference between the highest price you're willing to pay and the price you actually pay) to companies. It's a form of cod-Marxism where you are gouged according to your ability (to pay) and charged according to the desperation of your need:

https://pluralistic.net/2025/01/11/socialism-for-the-wealthy/#rugged-individualism-for-the-poor

The problems of surveillance pricing are well documented. Under Biden, the FTC did a landmark study on the practice, developing a rich factual record that documents the role surveillance pricing plays in the affordability crisis:

https://pluralistic.net/2024/07/24/gouging-the-all-seeing-eye/#i-spy

Companies are already using this technology to rip you off, and they're slavering for the chance to do more of it. Instacart was recently caught...