For years, airlines have been known to cling to outdated and even antiquated technology, afraid that upgrading their tech infrastructure could lead to the catastrophic downages that have affected most major airlines, including a chaotic and expensive weekend for British Airways last year.
But airlines have been quietly upgrading their systems, with results that aren’t always intended to work in favor of travelers.
Case in point, dynamic pricing, in which airlines collect their customers’ personal data in order to “customize” airfares based upon history, location and other variables. While the airline industry isn’t quite there yet, it is rapidly heading in that direction and already reportedly testing the software in some cases.
Now, New York Senator and Senate Minority Leader Chuck Schumer—a long-time airline industry watchdog—is calling upon the Federal Trade Commission to investigate the practice of dynamic pricing, which he called “’Big Brother’ meets ‘Big Business’” in a letter sent to the FTC over the weekend.
“It is a frightening combo for already-price badgered airline travelers,” wrote Schumer.
According to Schumer, the new technology will be used to track user IP addresses in order to predict what fares customers would be willing to pay, based on their browsing history. According to the senator, a cloud software company called PROS is already testing the software with several airlines.
According to a press release on its website, PROS, which calls itself a “cloud software company powering the shift to modern commerce,” recently announced a new partnership with IATA.
“With increasing demand dynamics in a highly competitive industry, artificial intelligence is the new requirement for driving profit-optimizing offers with greater speed, consistency and precision,” wrote PROS in the release. “Carriers that are adopting modern commerce capabilities are winning the most profitable business by removing friction from the buying process. [PROS] is enabling real-time dynamic pricing in the cloud that’s designed to drive revenue and profit growth.”
