Fight over phone privacy not over

Roger Clarke

Principal, Xamax Consultancy Pty Ltd, Canberra

Visiting Fellow, Department of Computer Science, Australian National University

Mirror of 28 August 1999

© Xamax Consultancy Pty Ltd, 1999

This document is at http://www.anu.edu.au/people/Roger.Clarke/DV/USCallRecs9908.html

This is a mirror of http://cnn.com/US/9908/27/telecom.privacy/, in order to achieve readability and printability, and ensure longevity of an important story.

Fight over phone privacy not over
Phone companies deny ruling will lead to marketing blitz

August 27, 1999; Web posted at: 3:25 p.m. EDT (1925 GMT)

Reporter Deborah Feyerick and The Associated Press contributed to this report.

(CNN) -- Everyone you telephone. Everyone you page. How often you talk to them -- and for how long. It's all information listed on your phone bill.

And if you thought that was private, a federal appeals court disagrees.

In a decision overturning federal privacy protection, the court ruled that phone company records belong to the phone companies.

That means they can use the information about customers for marketing purposes without obtaining their consent.

Consumer advocates are not happy with the 10th U.S. Circuit Court of Appeals decision and neither is the Federal Communications Commission. The FCC, which regulates telephone companies, plans to appeal the ruling by the three-judge panel.

FCC Chairman Bill Kennard said the court's decision to reject commission rules adopted last year removes important protections to consumer privacy.

"We think that consumers should have the right to determine where this information goes and who uses it," he told CNN. "Only after the consumer gives express consent should this information be sold to a telemarketer or used for other purposes."

Kennard said information such as calls made to a doctor or to a help group -- and the frequency of such calls -- could become fodder for marketers to target their goods.

'We're not pressing the privacy panic button'

Phone companies, however, say that won't happen.

"The important thing customers should understand is that phone companies have no interest in selling numbers to outsiders, so we're not pressing the privacy panic button," Bill McCloskey of Atlanta-based BellSouth told CNN.

When people make calls or pages, the companies providing them service end up with personal information including who, when and for how long the call lasted. They can also tell how much their customers spent for service.

The FCC rules had required telecommunications companies to obtain permission -- either written, oral or electronic -- before using or sharing customers' records, calling patterns and other personal information to market new services to them.

A 1996 telecommunications law had mandated such approval without specifying how it had to be given.

In a 2-1 ruling published last week, the appeals court overturned the FCC restrictions, saying they wrongly interfered with the phone companies' First Amendment right to free speech.

The court said the government failed to show any specific harm to customers from the practice.

"Although we may feel uncomfortable knowing that our personal information is circulating in the world, we live in an open society where information may pass freely," the ruling said.

Kennard expressed concern that the ruling would let companies assume they had permission to use customers' personal information unless customers told them they did not.

Customers might then inadvertently forfeit their right to privacy by missing a notice from the company informing them of the policy, he said.

Other FCC officials warned that the decision could open a wide door for releasing information, such as phone companies selling information about a customer's toll-free catalog shopping habits to a rival retailer.

Denver-based U S West, which brought the case, said it does not intend to share customers' personal information with other companies -- only with its divisions.

The company also says that the ruling might spare consumers some sales calls by letting companies target customer's perceived needs.

Selling phone records may prove 'tempting'

But Kennard said he was not convinced that all companies would abide by the same standard. "Some of them will find it just too tempting not to go ahead and sell this information to the highest bidder," he said.

Privacy groups have also expressed concern that the decision could set a precedent for privacy protections in other areas, such as the Internet.

"I think it could have potentially devastating consequences for individuals," said Diedre Mulligan of the Center for Democracy and Technology, a Washington-based privacy advocacy group.

The court's analysis, said John Morris, an attorney for the center, "may make it much more difficult to enact privacy legislation in other areas."

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Created: 28 August 1999

Last Amended: 28 August 1999

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