States Banning Surveillance Pricing: Who’s Joining the Push?

A growing number of states are moving to restrict or ban “surveillance pricing,” a practice in which companies use personal data to tailor prices or promotions to individual consumers. The issue has gained momentum after the Federal Trade Commission opened a national inquiry in July 2024 and released initial findings in January 2025 showing that retailers and pricing intermediaries can use data such as location, browsing behavior, purchase history, and even mouse movements to influence what price a shopper sees.

For lawmakers, the concern is straightforward: if two people are offered different prices for the same product because one has been profiled as more willing or able to pay, the market may become less transparent and less fair. Consumer advocates say the practice can deepen inequality and erode privacy. Business groups and some economists, however, argue that personalized pricing is not always harmful and can overlap with long-standing forms of discounting and revenue management. As the debate sharpens, several states are joining the push to ban surveillance pricing or require stronger disclosure.

What surveillance pricing means

The FTC describes surveillance pricing as the use of personal data and automated tools to set individualized prices or promotions for the same goods or services. In its July 2024 announcement, the agency said it was examining companies that market tools using data such as demographics, location, credit history, browsing history, and shopping behavior to help businesses target prices.

The agency’s initial January 2025 findings went further. FTC staff said intermediaries and retailers can rely on a wide range of inputs, including precise location, online activity, items left in a shopping cart, and mouse movements on a webpage, to tailor prices and offers. FTC Chair Lina Khan said at the time that Americans deserve to know how their private data is being used and whether firms are charging different people different prices for the same good or service.

That distinction matters because surveillance pricing is not the same as ordinary dynamic pricing. Dynamic pricing typically changes prices based on supply, demand, time, or inventory. Surveillance pricing, by contrast, is centered on the consumer’s personal data or inferred characteristics. Consumer Reports, which has tracked state legislation in this area, separates algorithmic pricing debates into three buckets: algorithmic price fixing, surveillance pricing, and dynamic pricing.

These States Are Joining in the Push to Ban Surveillance Pricing

California is one of the clearest examples of a state moving beyond discussion and toward a direct ban. In 2025, the California Assembly passed AB 446, a bill backed by Consumer Reports that would prohibit companies from using personal data gathered through electronic surveillance technology to set a customized price for a consumer. Consumer Reports said the measure targets the use of surveillance-derived personal data in pricing decisions rather than broader pricing flexibility.

Colorado has also been part of the push. Consumer Reports said it supported Colorado HB 1264, which would have prohibited surveillance prices and wages, placing the state among the early jurisdictions to test broader restrictions on data-driven discrimination in both consumer and labor markets. Although not every proposal becomes law, the bill shows how the debate is expanding beyond retail pricing alone.

Illinois has introduced legislation directly aimed at the issue. Senate Bill 2255 is titled the “Surveillance-Based Price and Wage Discrimination Act,” signaling that lawmakers there are also framing the problem as one of both consumer fairness and workplace equity. The bill text reflects a growing legislative trend: treating data-driven price discrimination as a distinct policy category rather than folding it into general privacy law.

New York is emerging as another major battleground. Consumer Reports said New York had seven algorithmic pricing bills introduced in 2025, the highest number of any state tracked in its analysis. The group also said New York took an important step by becoming the first state to require disclosure when companies use consumers’ personal information to change prices, even though disclosure is a narrower remedy than an outright ban.

Massachusetts is also in the mix. Consumer Reports’ 2025 tracker said Massachusetts had four algorithmic pricing bills introduced, placing it among the more active states considering new rules. That volume suggests the issue is no longer confined to a few large coastal legislatures but is becoming part of a broader state-level consumer protection agenda.

In practical terms, the states most visibly joining the push include:

• California, with Assembly action on a bill to prohibit surveillance pricing.
• Colorado, with legislation aimed at banning surveillance prices and wages.
• Illinois, with a bill specifically targeting surveillance-based price and wage discrimination.
• New York, where multiple bills have been introduced and disclosure rules have advanced.
• Massachusetts, which is considering several related proposals.

Why the issue is accelerating now

The state push is unfolding against a broader federal backdrop. In July 2024, the FTC used its 6(b) authority to order eight companies to provide information about surveillance pricing products and services. The companies named by the agency included Mastercard, JPMorgan Chase, Accenture, McKinsey & Co., PROS, Revionics, Bloomreach, and Task Software. The FTC said the study was designed to understand how these tools affect privacy, competition, and consumer protection.

By January 2025, the agency said its early review showed that a “wide range” of personal data could be used to influence individualized prices. According to the FTC, that can include direct consumer data, inferred data, and information from both first-party and third-party sources. The agency has also sought public comment on surveillance pricing practices, signaling that the issue remains active at the federal level in 2026.

Consumer advocates say those findings have given state lawmakers a clearer factual basis for action. According to Consumer Reports, state efforts are converging around more specific regulatory targets, with surveillance pricing now treated as a distinct problem rather than a vague subset of privacy law. That matters politically because lawmakers can draft narrower bills focused on pricing fairness, rather than reopening every aspect of digital privacy regulation at once.

What it means for consumers and businesses

For consumers, the main concern is opacity. If prices vary from person to person based on hidden data signals, shoppers may not know whether they are seeing a fair offer or a personalized markup. That concern is amplified by the scale of modern data collection. The FTC’s 2024 Consumer Sentinel Data Book shows the agency received 6.5 million consumer reports in 2024 across fraud, identity theft, and other consumer protection categories, underscoring the broader climate of concern around digital marketplace practices.

For businesses, the stakes are more complicated. Retailers have long used segmentation, loyalty programs, coupons, and time-based discounts. Some industry participants argue that personalized offers can benefit consumers by matching discounts to likely buyers or helping firms manage inventory more efficiently. The policy challenge is drawing a line between legitimate pricing strategy and the use of sensitive or opaque personal data to charge some people more.

There is also a compliance question. If more states adopt different rules, national retailers may face a patchwork of standards governing what data can be used in pricing, when disclosures are required, and whether certain practices are banned outright. That could push companies toward a simpler nationwide standard, especially if federal regulators continue to scrutinize the market.

The broader privacy connection

The push against surveillance pricing is closely tied to a wider crackdown on data collection and data brokerage. In 2024, the FTC announced actions restricting companies such as InMarket and X-Mode/Outlogic from selling sensitive location data, part of a broader effort to limit the commercial use of highly personal information. Those actions do not directly ban surveillance pricing, but they address the data pipelines that can make it possible.

State privacy debates are moving in the same direction. Consumer Reports said Virginia’s legislature recently sent a location privacy bill to the governor, and noted that Maryland and Oregon have already banned the sale of precise geolocation information. It also said several states, including California, Connecticut, Maine, Massachusetts, Vermont, and Washington, are considering similar location-data restrictions in 2026. While those measures focus on data sales rather than pricing, they could limit the raw material used for surveillance pricing systems.

What comes next

The next phase is likely to center on whether states prefer disclosure, targeted bans, or broader privacy restrictions that indirectly curb surveillance pricing. New York’s disclosure-first approach offers one model. California’s proposed prohibition offers another. Illinois and Colorado show that some lawmakers are willing to connect pricing and wage discrimination in a single framework.

The debate is also likely to intensify as regulators gather more evidence. According to the FTC, its study is still developing, and the agency has continued to frame surveillance pricing as a live issue affecting privacy, competition, and consumer protection. That means state lawmakers are unlikely to be acting in a vacuum.

Conclusion

The push to ban surveillance pricing is no longer a fringe policy idea. California, Colorado, Illinois, New York, and Massachusetts are among the states helping turn it into a mainstream legislative issue, even if their approaches differ. Some are pursuing outright bans, others are focusing on disclosure, and still others are tying the issue to broader privacy and anti-discrimination rules.

What unites these efforts is a shared concern that personal data should not quietly determine what consumers pay. As federal scrutiny continues and more state bills are introduced, surveillance pricing is poised to remain a major battleground in the next phase of U.S. consumer protection policy.

Frequently Asked Questions

What is surveillance pricing?
Surveillance pricing is the use of personal data, behavioral signals, or inferred traits to set individualized prices or promotions for consumers shopping for the same goods or services.

Which states are leading the push?
Based on current public reporting and bill tracking, California, Colorado, Illinois, New York, and Massachusetts are among the most active states in this area.

Is surveillance pricing the same as dynamic pricing?
No. Dynamic pricing usually changes prices based on market conditions such as demand or timing. Surveillance pricing focuses on the consumer’s personal data or behavior.

Has the federal government banned surveillance pricing?
No federal ban is in place. The FTC has opened a market study, issued orders to companies, released initial findings, and requested public comment, but that is not the same as a nationwide prohibition.

Why are lawmakers concerned about it?
Lawmakers and consumer advocates argue that hidden, data-driven pricing can reduce transparency, undermine fairness, and rely on intrusive personal data collection.

Could more states join in 2026?
Yes. Public tracking from Consumer Reports suggests that state-level activity on algorithmic and surveillance pricing remains active, and related privacy bills are also expanding in multiple legislatures.