Sacramento, Calif. – The Computer & Communications Industry Association has submitted written comments in opposition to California’s SB 1154 and will testify at today’s hearing before the state Senate Judiciary Committee.
SB 1154 would harm numerous businesses and industries statewide by prohibiting the use of pricing algorithms to set or recommend a price or commercial term that incorporates nonpublic competitor data. These algorithms are crucial for businesses to efficiently adjust prices in line with supply and demand fluctuations, bypassing traditional pricing methods. Enacting this legislation would have widespread repercussions, as it seems to presume the illegality of a broad spectrum of activities.
Any concerns about pricing algorithms are already covered by current state and federal antitrust laws. Pricing algorithms are designed to automate the pricing process and leverage data for better decision-making. Such algorithms are widely used across a variety of businesses in various industries to optimize prices by analyzing factors such as cost, demand, and competitor pricing. These algorithms adjust pricing in real-time in response to market conditions, allowing businesses to save money and, in many cases, enabling consumers to receive lower and more competitive prices for various goods and services.
The following can be attributed to CCIA State Policy Director Khara Boender:
“Without clarity in the bill language , it would be challenging to discern which data would be prohibited for training price algorithms – and that in turn would make it difficult to avoid potential violations of California’s bill (SB 1154). The California Chamber of Commerce has even added the bill to their 2024 “job killer” list of legislation pending before the California legislature – a sign of the widespread opposition to this bill is a clear sign of the harm it could cause to the state’s economy. We urge California lawmakers to reject this unnecessary and detrimental measure that would hurt businesses all across the state.”