Intelligent life at the FCC

In the telecommunications Olympics, the FCC won a gold last week. But plant a big goose egg next to the monopolistic phone industry.

In a ruling that, with any luck, will set a precedent for the Internet, the FCC said the phone numbers you dial, the way you dial them and the people you talk to are nobody's business but your own.

For some time now, the phone companies (did you know that "phone company" is really an anagram for "make more money?") have been trying to figure out how to make money off those vast databases that record whom you call and when.

Sure, the 1996 telecom reform bill said the telcos couldn't re-use this information without consumer consent. But those tricky telcos came up with something called "negative option" consent.

What's that? Unless you explicitly objected in writing, the phone companies could use your calling-pattern information to sell you new services - or sell your information to third parties - until you objected in writing. How many millions of people would you bet would not realize they had this "right" - until they started wondering how all those companies knew what kinds of calls they were making?

Fortunately, the FCC ruled last week that the telcos must ask your permission first before they sell any information about your calling patterns. The commission cited fears of consumer blackmail ("Dear Mr. Jones, we can't help but notice that you, chairman of the board for Really Big Public Company called 1-800-PSYCHIC over 50 times last week. Does your board of directors know?").

Still, don't be surprised if the phone companies still try to find some wiggle room. I can very easily see one of those little tiny checkboxes at the bottom of one of your monthly invoices that reads "Would you like the phone company to use information about your calling patterns to better serve you and make you aware of new calling or market programs designed to save you money?"

Or how about that tiny little print at the bottom of the page that reads "By paying this monthly phone bill you are acknowledging that you would like to receive information about products and services that may be of interest to you in the future." Both of which would allow the phone company to sell your name and dialing patterns to anybody with a buck in their hand.

Of course what is really important about this ruling is the implications it may end up having on the Internet - a place where privacy is potentially of equal concern.

There are presently no regulations on tracking user patterns or information on the Internet. Sure, we are all educated on the risks of cookies, but let's move beyond that. Just about any Web site you visit can gather some basic information about you (name, e-mail address, Internet address) when you visit. And what they can't get directly from you (i.e., your e-mail address), they can easily get from any one of the online directory services (such as Four11 or Anywho).

Just to make it easy, however, sometimes we knowingly provide information that we don't realize might be used against us at some point in the future.

Digital Equipment Corp.'s AltaVista search engine is a prime example. Every time you do an AltaVista search, a little bit of information is gathered and sold to advertisers on the spot. Like its competitors, AltaVista sells keywords to advertisers.

We did a search on "car leasing ford" - something you might search for if you are looking for leasing information on Ford cars. Our search result turned up exactly what we expected, but also triggered a banner ad at the top of the page from Honda (a major Ford competitor). Our second query was for "cisco router switch" which resulted in a banner ad for arch-rival 3Com at the top of the page.

Just to see how this might be used against non-techies out there, we did a literary search of sorts. We did a search query for "danielle steele erotic romance" and got an ad for a dating service called Match.Com (it turns out to be an anonymous online chat service - as if that were the '90's equivalent of dating).

We weren't quite sure that the dating service ad was there because of our search criteria, so we did a second search for the same phrase. This time we got an ad banner for an X-rated site (this is not a joke). It looked like the operative word here was "erotic," something I know will just shock the heck out of my mom if she ever tries to use the Internet like she uses the local bookstore.

So here we have a search engine site that potentially knows not only who you are (from your browser configuration or your Internet address) but is also tailoring your banner ads to meet your special interests (let's not even get into the discussion about the inappropriateness of the ads they are displaying, or the assumptions they are making in displaying certain advertisements - that will be addressed next week!).

More important, what is to keep them from now selling your name and information search request to the very company whose ad they displayed for you? Nothing.

So on the one hand, we have a great move on the part of the FCC for phone privacy. But on the other hand, we have a Web industry that has no such regulation. This will be very difficult to change, but given the recent court rulings on free speech and the Internet, its something that I believe is possible - if enough people speak up.

Perhaps the real catalyst here will be the use of the Internet as a transportation medium for long-distance phone service. Will these new FCC regulations apply here? Probably not, unless we can figure out a way to properly regulate the Internet (something that is about as likely as Bill Clinton being named Man of the Year by the Paula Jones fan club).

If you have a counter thought, or perhaps an idea on how to control this type of behind the scenes mass marketing abuse, drop me a line or visit our Forum.