McDonald’s was sued in the United States for using artificial intelligence to help set prices in its stores and franchises.
The McDonald’s pricing system analyzes data from millions of transactions conducted daily. – Image: Live heavenly/Shutterstock
What the lawsuit says
Thomas accuses McDonald’s of using algorithms to coordinate prices with independent franchisees. The lawsuit claims that the system uses non-public data and that this practice could violate American antitrust laws.
As we commented here on Olhar Digital, McDonald’s pricing mechanism uses machine learning algorithms to continuously analyze data from millions of transactions conducted every day in nearly 14,000 restaurants.
The use of this type of technology also appears in other sectors. According to Reuters, fast-food companies are using artificial intelligence to help set prices and in other operations.“Independent companies should set their prices independently,” the action states.
McDonald’s disputes the allegations
In a statement released on Monday, McDonald’s classified the allegations as speculative and based on insufficient information.
Read more:
- Ex-OpenAI says that AI companies still don't know how to control their models
- OpenAI will add an invisible watermark to ChatGPT text
- AI can know through the brain when it misunderstood what you meant
“The AI does not set the price of a Big Mac or any other item on our menu,” the company stated.
The company said that franchisees make their own pricing decisions and that recommendation and analysis tools are widely used in different sectors.
The controversy, therefore, is less about the existence of the tool and more about how it might have been used. The accusation claims that the system could have influenced decisions that should remain independent among restaurants.
McDonald’s claims that AI does not set product prices and that franchisees maintain autonomy. Image: Patcharaporn Puttipon4289/Shutterstock
A dispute that goes beyond fast food
The action is part of a series of collective lawsuits presented in the United States in recent years against companies accused of using algorithms or artificial intelligence to coordinate hotel prices, apartment rentals, and other products and services.
The lawyer Lark Turner, who represents the plaintiff, accused McDonald's of using the large amount of data available in its operations and franchise system to charge additional fees to consumers.
Among the points that will need to be considered in the case are:
- the role of non-public data in the pricing system;
- the degree of autonomy of franchisees in the face of the tool's recommendations;
- the limits of algorithm use when different businesses need to set prices independently.
The case still has to proceed through the courts before these allegations are examined. For now, the case puts the line between a price recommendation tool and possible coordination between independent companies under analysis.
Valdir Antonelli is a journalist with a specialization in digital marketing and consumer behavior.
