NEW DELHI: Amid instances of sharp fluctuations in air ticket pricing, Competition Commission of India (CCI) has planned to assess algorithms used by domestic airlines for ticket pricing to check for possible cartelization. CCI, the watchdog, keeps a tab on unfair business practices across sectors. Issue of sharp rise in airfare pricing came to light during the Jat agitation in early 2016, when rail and road connectivity were severely affected in many parts of the country.
Officials said the CCI has been looking into the issue of fluctuating airline ticket prices after that. Speaking on the sidelines of a conference organised by industry body Assocham, CCI Chairperson D K Sikri said the regulator is looking at how algorithms function when it comes to pricing of air tickets in order to check for possible cartelization.
At the conference, Sikri said collusion among digital players through self-learning algorithms is one of the biggest challenges that are being faced by competition law enforcers. He wondered how the sudden rise in airfares for flights between Chandigarh and Delhi during the Jat agitation could have happened. “We asked the airlines. (They said) we don’t know, the algorithms are driving it up. What are algorithms? These are not kind of systems that are moving on their own. Somebody has designed them, logic has been put into it,” Sikri said.
“They (airlines) say we have these indicators and variables, but they are not showing the weightage given to them. So, we are talking to a lot of technical people ... how we bring them down to understanding these algorithms,” he added. The official said that one suggestion was for the CCI to develop its own algorithm to look at the issue, but that would require a huge investment. Another suggestion, he said, was to develop a hypothesis and “tell them (airlines) to satisfy the hypothesis with their algorithm. If it fails, hold them responsible”.