Washington (April 28, 2015) – Senator Edward J. Markey (D-Mass.) was joined today by democratic senators seeking answers to a new transportation policy that could allow one consumer to be charged more than another consumer for the same seat on the same flight based upon personal information collected about the individual. In a letter sent today to the Department of Transportation, the senators query the department on measures in International Air Transport Association (IATA) Resolution 787, which allow for one consumer to be charged a unique price for airfare based on a combination of seat availability and a consumer’s personal characteristics. Also known as “personalized pricing”, the practice requires the large-scale collection, use and storage of sensitive personal information by airlines and travel agents for the purpose of quoting airfare prices to customers, raising concerns about privacy and possible unfair discriminatory practices.
For example, airlines, using consumer zip code information, may offer special fares to consumers who live in more affluent zip codes to entice them to travel more frequently while failing to provide those same discounts in lower income areas. On the other hand, business travelers who regularly fly the same routes could face higher prices.
“Although under Resolution 787, consumers will still have the option to decline to provide personal information to the airlines and shop anonymously, we remain concerned that Resolution 787 does not contain adequate measures to prevent airfare vendors from penalizing consumers by charging higher prices for those who choose not to share their information,” write the Senators in the letter to the Department of Transportation. “We are concerned that airlines could penalize consumers who do not provide personal information, as well as could engage in discriminatory pricing practices with customers who do share their information.”
Full text of the letter can be found HERE.
In the letter, the Senators ask the Department of Transportation to respond to questions that include:
· How the department will ensure that airfare vendors will not penalize consumers who choose to shop anonymously and not to participate in personalized pricing
· How the department evaluated potential benefits and harms to consumers from the proposals contained in IATA Resolution 787
· Department efforts to mitigate harms to consumers posed by personalized pricing
· How the department evaluated IATA Resolution 787 for potential abusive or discriminatory practices by airfare vendors against consumers
· Privacy requirements that will govern information collected by airfare vendors using personalized pricing
Other senators signing the letter to the Department of Transportation include Bill Nelson (D-Fl.), Maria Cantwell (D-Wash.), Al Franken (D-Minn.), Cory Booker (D-N.J.) and Richard Blumenthal (D-Conn.).
