By Lee Hepner & Stephanie T. Nguyen

In May 2026, Governor Wes Moore of Maryland declared victory over surveillance pricing, signing a bill passed by the legislature to stem the practice of personalized discriminatory pricing at grocery stores.

There was a fundamental problem: the bill did no such thing. Under the guise of prohibiting surveillance pricing, Moore granted sweeping permission for it to continue.

In fact, the Maryland bill has many problems: Ill-defined exemptions for “promotional offers” and “temporary discounts” played directly into the hands of industry lobbyists who argued – incorrectly – that the law would prohibit broadly accessible coupons or discounts for seniors, students, or veterans while a separate carveout for subscription-based pricing permits surveillance pricing to flourish in one of the fastest-growing market segments in our economy.

Undefined “loyalty programs” are also exempt, even though loyalty programs are routinely abused to charge consumers higher prices. The bill also blew a hole through the state’s broader Consumer Protection Act, prohibiting consumers themselves from bringing claims when they are harmed by price discrimination.

The failed Maryland surveillance pricing bill speaks to a larger problem: What happens when lawmakers leverage popular outrage to “solve” problems, but fail to actually solve them? Surveillance pricing is deeply unpopular across partisan lines, but with very limited exception, lawmakers have failed to channel popular outrage into meaningful regulation. Corporate lobbyists have exploited very real affordability concerns to mislead lawmakers into believing technologies designed to maximize profits can somehow deliver broad affordability.

Take Colorado, where an economy-wide ban on surveillance pricing and wage-setting, which had been carefully negotiated to avoid interfering with legitimate consumer or worker benefits, was unceremoniously vetoed earlier this year.

In his veto letter, Governor Jared Polis, who last year vetoed a separate law clamping down on price fixing in rental housing markets, said that a ban might threaten the ability of corporations to offer “lower” prices. It’s an argument that regurgitates industry talking points, while ignoring how surveillance pricing works. Say a company charges people between $2 and $10 for the same toothbrush. You get charged $9.99 – technically “lower” than $10. But under Polis’s logic, that counts as an acceptable “lower” price, even though it’s 5x what someone else pays for the exact same toothbrush.

Genuinely necessary uses of personal data in pricing are rare and easy to exempt: senior discounts require proof of age, delivery fees depend on location, and credit pricing is already heavily regulated. The problem comes when exemptions are broad enough to swallow the rule.

One of the most common policy traps derives from the popularity of loyalty programs, which can offer pro-competitive, non-discriminatory benefits to consumers. But loyalty programs are also prime vectors for mass data collection, just as capable of exerting market power to determine which consumers may pay more.

The appropriate policy response is not to allow surveillance pricing to proliferate within a loyalty program, but to protect the participants in loyalty programs from abuse. Lawmakers should ensure that “bona fide” loyalty programs are based on publicly advertised terms, and that those terms are consistently applied across the market. Otherwise, loyalty programs can function as a Trojan horse: generous at the gate, but concealing hidden fees, intrusive data extraction, and discriminatory pricing.

For similar reasons, lawmakers should avoid broad exemption for “discounts,” and instead set out to protect “bona fide” discounts, so that consumers can seize a deal with confidence. Bona fide discounts are easily defined: They are publicly advertised, their terms and conditions are clearly defined, and those terms are consistently applied across all eligible consumers. Any exchange of personal information – for instance, to get a senior, student, or veteran discount – should be both voluntary and necessary for getting that discount.

Industry lobbyists have nevertheless argued that “personalized” discounts deserve broad exemptions from laws prohibiting surveillance pricing. Setting a personalized discount is functionally indistinguishable from setting a personalized price. Like the toothbrush example, a personalized “discount” only obscures the fair market price. Any price higher than the fair market price becomes a “discount” in name only.

Everyone loves a good deal. But when it comes to personalized discounts, consumers aren’t taking the bait. A recent poll revealed that 72 percent of voters would accept smaller discounts on average if it meant all consumers were offered the same price. Lawmakers shouldn’t take the bait either.

Nor should lawmakers be deterred by any concern that banning surveillance pricing would restrict popular time-based discounts, like matinee ticket prices, happy hours, or end-of-season clearance sales. Such discounts require no exchange of personal information and are not implicated or restricted by even the broadest ban on surveillance-based pricing.

Finally, there is no reason why surveillance pricing legislation should give special exemption to subscription-based pricing.

In a recent lawsuit against The Washington Post, subscribers allege that the company used detailed subscriber data – including location data, income, browsing history, device information, and Amazon purchases – to create reader profiles, then to segment and monetize readers through personalized prices and content throttling. A decade ago, all subscribers may have paid $9.99 per month. Readers today might face an inexplicable 300 percent price increase, or wildly divergent weekly, monthly, or yearly prices, with little or no explanation at all. The culprit, the lawsuit alleges, is surveillance pricing.

The purpose of regulating surveillance pricing is to re-empower consumers in a context where their vulnerabilities are being weaponized against them. When everyone sees a different price, it becomes harder to compare prices, to know whether you’re getting a good deal, or to have any reference point for a fair price. When shoppers know less about how prices are set, consumer surplus becomes corporate profit. Indeed, the alleged practitioners of surveillance pricing – including Instacart, Delta, JetBlue, Washington Post, Uber, Lyft, Amazon, and Google – benefit from the fact that consumers are largely unaware it’s happening at all.

In a political climate where voters are looking to elected officials to stand up to abuse and to deliver results, policymakers must remain vigilant. Anything less is a failure to govern at a time when working people are becoming live test subjects, absorbing all of the economic and social risks of transformative technologies.

Lee Hepner is a California-based antitrust lawyer and Senior Legal Counsel for the American Economic Liberties Project.

Stephanie T. Nguyen is the author of the Division of Field Notes and former Chief Technologist at the Federal Trade Commission.