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FCC Limits Phone Companies' Use of Customer Information

Federal regulators adopted rules Tuesday to limit use of customer records by telephone companies to sell other services. Customers' permission will be required for companies to share personal information with organizations that do not provide communications services. The rules constitute the FCC's second attempt to define the kinds of permission companies need to use customers' private information.

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Federal regulators adopted rules Tuesday to limit use of customer records by telephone and paging companies to sell other services. The companies will have to get customers’ permission to share personal information with organizations that do not provide communications services, the Federal Communications Commission said. That permission can be assumed, however, when a company wants to share information internally or with other affiliated communication companies. For example, a company that provides phone service can share a customer’s records with its other divisions to sell related services such as Internet or voice mail. It is up to consumers to tell a company they don’t want their personal information shared at all. The rules constitute the FCC’s second attempt to define the kinds of permission companies need to use customers’ private information. An appeals court threw out the agency’s previous regulations in 1999 on ground that they violated the rights of companies. The voided rules required companies to obtain permission — written, oral or electronic — in all cases. The new rules are less restrictive. “This is definitely weakening the privacy protections that were originally provided,” said David Butler, a spokesman for Consumers Union. “Consumers will have to go through a more complicated process to keep their private information private.” Allison Remsen, a spokeswoman for the United States Telecom Association, which represents major phone companies, said the new rules “balance consumer privacy interests with telecom carriers’ desire to offer targeted marketing of products and services.” While the FCC approved the rules, agency Commissioner Michael Copps said he objected to the approach that does not stop companies “in all instances from selling to the highest bidder personal and detailed information about who Americans call, when they call and how long they talk.” A 1996 telecommunications law says companies have to secure permission to use personal information before pitching customers new services or products such as credit cards to other telecommunications services. The law does not specify how permission has to be given. US West, which was later bought by Qwest Communications, successfully challenged the FCC’s first attempt to clarify the law. The 10th U.S. Circuit Court of Appeals ruled against the FCC restrictions, saying they interfered with the phone companies’ right to free speech. Copyright 2002 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

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