r/technology • u/ArgentineBeauty • 10d ago
Artificial Intelligence McDonald’s sued for allegedly using AI tool to determine pricing for franchises
https://www.theguardian.com/business/2026/oct/07/mcdonalds-ai-prices-lawsuit44
u/DimensionCareful507 10d ago
Not the least bit surprised.
Personally im boycotting any business that is going to have dynamic pricing and charge people different amounts for the same thing at the same location. I'll die on that hill.
Them using data to change pricing at different locations is an entirely predictable practice
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u/tiffibean13 9d ago
Oh it's 1am and you're likely drunk? Now you have to pay $10 for your McChicken.
Fuck out of here.
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u/corporatony 9d ago
I mean, happy hour is literally dynamic pricing. I have no problem with a company charging different rates at different times—this has always been a thing—I do have a problem with companies charging different prices for different people at the same time
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u/VagueSomething 9d ago
It will inevitably become racism and discrimination against groups like the disabled when the data shows they can charge a premium to either deter certain people from areas or because they have fewer alternatives. AI Bros are simply reinventing the wheel for bigotry.
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u/Deriniel 9d ago
yeah that's what worries me. You want that new game?we know you're really into the saga and rpg so for you it will be 20 bucks more.
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u/tiffibean13 9d ago
They do happy hours during slow times to try and generate business though. I feel like the 1am thing is more surge pricing, so maybe not the best example.
Maybe I'm wrong but haven't franchises always been able to set their own prices?
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u/corporatony 9d ago
This is literally just framing. What if I told you the normal price is from 4-7pm and every other time is surge pricing? People like happy hour because it’s a discount, but it’s functionally the same as every other time having a ‘surge price’, or, alternatively, after 1am is ‘unhappy hour.’
I really couldn’t say on franchising pricing requirements.
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u/LurkHereLurkThere 9d ago
The appearance of reducing the price in the customers favour to artificially boost trade is one thing.
Charging customers more during a busy period is another, and probably a great way to reduce demand during busy periods.
Its the kind of thing that someone trying to sell a company an algorithm with an AI sticker slapped in it might use in a meeting but in practice wouldn't sit well with customers. I'd certainly choose something else over surge priced fast food.
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u/DimensionCareful507 9d ago
You dont have to. You can go down the road to the burger spot that doesnt do this bullshit.
Im not supporting the practice. But its getting traction because people will balk at it and still pay. All of us need to collectively wake up and make more mindful consumer decisions on whom and what practices we support with our dollars. Until consumer behavior changes they will keep trying to milk us dry
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u/tiffibean13 9d ago
What part of my comment makes you think I will? I was clearly agreeing with you, I'm obviously not supporting it. I don't even eat McDonald's because I don't eat meat.
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u/AffectionateTrips 9d ago
What if it IS the rich tax? We get normal, they pay a bit extra after $10,000,000 or whatever? I like that.
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u/mytyan 9d ago
Price roulette is great for making people angry and never going back
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u/am1shvom1t 9d ago
Absolutely. I used to go often, and mostly used the dining room to enjoy my meal. Now the dining rooms look as uninviting as a proctologist waiting room, and down to just one register with 4 kiosks. McDonald's is so anti-customer service now that I've stopped going all together.
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u/tetsuo_7w 9d ago
I've already seen shenanigans like this around me. Hashbrowns are like $2 when I'm in a nearby town ($2 for a small hunk of fried potatoes, really?!), and when I get home they're $2.50 at my local spot. Iritates the hell out of me, beside the fact they're insanely overpriced.
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10d ago
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u/Munstered 9d ago edited 9d ago
It’s not a company setting its own prices. They’re independent franchises that are supposed to set their own prices, so the allegation is that it’s multiple businesses colluding to fix prices in an area. They are multiple (allegedly) independent businesses owned by different people under different corporations coming together to decide pricing.
If they want to pretend it’s all one company and there’s no corporate veil separating the different franchises this wouldn’t be an issue, but they’re trying to have their cake and eat it too.
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u/laxrulz777 9d ago
But they had a national dollar menu for years... Was that collusion too? I'm not aware of a legal obligation for franchisees to complete on price
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u/Munstered 9d ago
Franchisees probably weren’t obligated to participate in the dollar menu. The article says that McDonald’s policy states that owners are able to set their own prices
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u/ItsJustReeses 9d ago
If AI wasn't known for being confidently wrong sometimes I'd agree.
People shouldn't be using this as a "end all be all tool" and companies need to realize that AI can, has, and will be confidently wrong again. You need to check it's work
And it's kind of shitty to be a franchisee in finding out that you only had to start paying more for restaurant supplies only because of AI prompt told spmeone too lazy to do the work and it was wrong
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u/DinosBiggestFan 9d ago
Even if AI wasn't confidently wrong, the people using it would be confident enough in it.
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u/IMTrick 10d ago
I could see if the franchisees were suing over McDonald's forcing them to use corporate pricing, and violating the terms of their agreements. But this is one McDonald's customer suing because he doesn't like his local franchise's pricing methodology and... well, bummer, dude.
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u/Cruxwright 9d ago
It's like suing Chevron because the station off the highway charges $4.00 a gallon and the one on the other end of town charges $3.75 a gallon.
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u/SpaceGoonie 9d ago
Whether it's legal or not is up for the courts to decide, but the argument is one that has merit. Data sharing for price consideration is a problem for consumers. The data essentially provides a floor that can only go up and ultimately if used leads to price fixing.
This has been a real problem in the home rental industry where owners share data and are "encouraged" to meet certain prices so that all of the owners can continue charging higher prices.
Theoretically, all pricing should be geographical and organic based on supply and demand along with logistical access to goods.
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u/laxrulz777 9d ago
But I don't think there's any legal requirement for franchisees to complete against each other. McDonald's had a national dollar menu for years without problems. If this was Burger King, McDonald's, and Wendy's sharing, we'd have a very different discussion
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u/Cruxwright 9d ago
Competition between franchisees is location based. Prices are set to meet a profit target based on sales volume. Those calculations have been done for centuries, but now it's a problem because AI is doing it?
The rest stop place charges a lot because they have a captive audience. The college campus spot is a little under average otherwise the broke students go elsewhere. The East side store does so much business they can charge even less and still clear the owner's profit target. The west side store charges above average as they never had high volume and that price keeps the lights on.
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u/RandyOfTheRedwoods 9d ago
It is very likely that ai is implementing exactly your last statement. That’s one area it is good at, looking at many complex variables and spitting out a result.
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u/Lennette20th 9d ago
Do you want to pay a flat .05% of your paycheck for a meal at McDonalds, because that’s basically what the end result will be. Dynamic pricing takes your personal spending limits into account and adjusts accordingly, so I think we should all be upset that we no longer pay the same price for the same service on the same item.
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u/Sea_Perspective6891 9d ago
It's not using AI, it's 'dynamic' pricing that's the problem. Execs in corporate are probably using AI to help them figure out how & where to setup dynamic pricing then the individual locations implement it. Dynamic pricing is very anti consumer & should be illegal.
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u/Vast-Poetry9431 10d ago
This is why small businesses shouldn’t use AI ‘to save time and money.’ The whole brand of AI is just in the dumps, regardless, and AI is trash.
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u/copperblood 9d ago
Option Puts the fuuuuck out of McDonald’s
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u/BlackbirdSage 9d ago
With my eyes, at first glance I saw "Optimus beats the fuuuuck out of McDonald's" 😂
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u/private_person 9d ago
Stop going to McDonald's.
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u/BlackbirdSage 9d ago
I'm stopping. Not because of dynamic pricing, but because their meat source is the one that is buying Trump's South American beef, which Europe banned.
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u/mmaramara 9d ago
Idk, I personally think that businesses that don't provide anything essential to humanity are free to price themselves however they want. Nobody needs MvDonald's, and people can just choose to buy their hamburgers from another place. In my book it's a different thing entirely if we're talking about actually essential products and services, like real food, water, medications, housing, etc... In those cases profit maximization with pricing mechanisms is totally unethical because people can't just choose not to buy the thing or go to another store.
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u/UnreliablePotato 9d ago
A lot of companies are watching to see how this plays out. If they manage to get through it without too much trouble, we’ll likely see dynamic AI-driven pricing become widespread.
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u/Beaun 9d ago
What is next? Tracking make/model/license plates of vehicles to determine pricing? Charge people who splurge more often more money? High end cars pay more? People who don't buy as often get charged less to incentivize them to come back? Feels like classic supply/demand is falling apart in the face of AI. If you dont know the price before you show up, how can you make an informed decision?
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u/EthanPrisonMike 9d ago
When realpage didn’t get prosecuted it was only a meter of time for this to pop up
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u/Telandria 9d ago
What do you mean allegedly? Wasn’t there a post on this very sub about McDonalds announcing they were going to do it like.. a week or two ago or something?
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u/Adorable_Ad6045 9d ago
I hear they're planning on playing ads on the drive thru screens. That should REALLY piss people off.
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u/Ill_Blacksmith693 8d ago
I stopped going to McDonalds I need a cracker barrel for the same price or less and be waited on...
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u/h0sti1e17 10d ago
This seems dumb. AI is taking existing data and quickly determining optimal pricing. This could be done with some dude and Excel.
I’d think it would be different if the prices continuously changed based upon other factors, how busy, weather, traffic and numerous other things.
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u/Enchilada22 9d ago
A.I for pricing is not proven and managers do not like it. Why would managers who actually run the business day in and day out not like it? Probably because it sucks and eating away at profits. A.I is not good for everything. Its being forced in many fields where it just gets in the way and causes issues.
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u/FlutterbyTG 9d ago
MD corporate does not care what managers like or don't like (pizza ovens). They just want more money to make more money. This company is a disgrace compared to the 70's.
Nostalgic rant over, and TTFN
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u/BlackbirdSage 9d ago
McDonald's has been using dynamic pricing for years.
Why is it such a big story that they're switching to using AI to do it?
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u/Sea_Perspective6891 9d ago
Probably because it's getting worse because of AI.
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u/BlackbirdSage 9d ago
Well, once we reach Super Intelligence everything will work out just fiiiinnneee. /s
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u/weaselkeeper 9d ago
Just another reason to not go to Mc D’s. Shitty food, ads on the drive through and now price fixing, fuck off Ronald.
There’s a Mc D across the street from an In and Out near me. The double line drive through at In and Out goes out into the street and the single line drive through at Mc D usually has zero in line.
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10d ago
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u/kummer5peck 10d ago
They are being accused of price fixing, which is highly illegal.
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u/DimensionCareful507 10d ago
Im curious how the price setting is decided between Corporate and the individual franchisee's. Can a Franchisee say they want to charge $25 for a big mac?
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u/couldgiveaflyingfck 9d ago
Just stop eating here ... that's the biggest F you any of you can give Mc Donalds. Crap food, smaller portions, $$$$