by Jamil Ragland CTNewsJunkie
HARTFORD, CT — Senator Richard Blumenthal sounded the alarm Monday morning about potential pricing dangers after Delta Airlines announced that it would expand its use of artificial intelligence in determining its dynamic pricing.
“What the airlines are doing, Delta in particular, is tailoring prices up to your pain point,” Blumenthal said while standing outside the east side of the state capitol building. “They take information about where you live, what you’ve bought in the past, your social media activity, all of the personal information that is available publicly and some purchase history within Delta Airlines itself to estimate what you can afford and how much you need the ticket.
“So, the individualized pricing is based not on competition, not on supply and demand, not on your perceptiveness in buying early, but on how much you can afford to pay and how much you need the ticket, up to your pain point.”
In an earnings call held on July 10, Delta Airlines President Glen William Hauenstein said that currently, 3% of its domestic pricing utilize AI systems for what it refers to as “revenue management.” Hauenstein said that the company plans to grow that to 20% by the end of the year.
“We’re optimizing revenue through our partnership with Fetcherr, leveraging AI-enhanced pricing solutions,” Hauenstein said. “While we are still in the test phase, results are encouraging.”
Delta officials did not immediately return a request for comment.
In a letter addressed to Hauenstein and Fetcherr CEO Roy Cohen, Blumenthal, along with Sen. Mark Warner, D-VA, and Sen. Ruben Gallego, D-AZ, demanded that both companies be more transparent about the data used to train its models, the sources of that data and the number of customers affected by AI driven price models. The senators also expressed concerns about the use of personal data for pricing purposes.
“The implications for individual consumer privacy are severe on their own,” the letter states. “Surveillance pricing has been shown to utilize extensive personal information obtained through a variety of third party channels, including data about a passenger’s purchase history, web browsing behavior, geolocation, social media activity, biometric data, and financial status.”
In a statement provided by Senior Vice President Chris Thatcher, Fetcherr flatly denied the senator’s allegations.
“Fetcherr’s technology has been developed to streamline processes already in place at companies and does not allow for individualized or personalized pricing,” Thatcher wrote. “Our generative AI system does not and will not use, collect or receive any Personally Identifiable Information (PII). Fetcherr remains steadfast in our commitment to transparency and to our compliance with applicable regulations.”
So far, the federal government has provided little in the way of regulation for artificial intelligence and data privacy. A proposal that was initially part of the recently passed Big Beautiful Bill would have prevented states from passing their own regulation of AI, but that provision was left out of the final bill.
Earlier this month, the Trump administration issued its AI Action Plan, but there was little regarding new consumer data privacy and AI protections.
Last week, Blumthenal and Sen. Josh Hawley, R-MO, introduced bipartisan legislation that would bar AI companies from training their models on copyrighted work, and make it easier for Americans to sue companies that train their models on personal data and copyrighted work without consent. The duo also proposed a bipartisan AI framework two years ago, but it has failed to be taken up by Congress.
Blumenthal said privacy should be protected, calling the current situation “the wild west” in terms of consumer protections regarding AI.
“Obviously there’s no regulation right now of AI. And so there’s no effective protection for consumer privacy, which is one of the main dangers here. We’ve been focusing on price discrimination and potential profiteering and price gouging, which is a real danger. But there’s also a jeopardy to privacy.”