Federal Communications Commission FCC 96-329
Before the
Federal Communications Commission
Washington, D.C. 20554
In The Matter of
Implementation of the
	
CC Docket No. 96-115Telecommunications Act of 1996:
Telecommunications Carriers' Use
of Customer Proprietary
Network Information;
Use of Data Regarding Alarm Monitoring
Service Providers
REPORT AND ORDER
Adopted: August 6, 1996
	
Released: August 7, 1996
By the Commission:
I. INTRODUCTION
1.
	
On May 17, 1996, the Commission released a Notice of Proposed Rulemaking'
regarding certain customer information provisions in the Telecommunications Act of 1996.2
addition to addressing the customer proprietary network information (CPNI) and subscriber listinformation provisions set out in Section 222, the Notice also sought comment regarding howto implement the restrictions on use of alarm monitoring data set out in Section 275(d).3 Section
275(d) provides that "[a] local exchange carrier may not record or use in any fashion the
I Telecommunications Carriers' Use of Customer Proprietary Network Information and Other CustomerInformation, CC Docket No. 96-115, FCC 96-221 (rel. May 17, 1996) (NPRM or Notice).
2 Pub. L. No. 104-104, 110 Stat. 56 (1996), codified at 47 U.S.C. §* 151 et. (the 1996 Act). The 1996Act amended the Communications Act of 1934 (the 1934 Act). The sections cited in this Report and Order are
sections of the 1934 Act, as amended.
The Commission has initiated a separate proceeding that seeks, jj
	
ja, to clarify and implement certain
other provisions of Section 275. Implementation of the Telecommunications Act of 1996: Telemessaging,Electronic Publishing, and Alarm Monitoring Services, CC Docket No. 96-152, Notice of Proposed Rulemaking,FCC 96-310, (rd. July 18, 1996).
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occurrence or contents of calls received by providers of alarm monitoring services for the
purposes of marketing such services on behalf of such local exchange carrier, or any other
entity."4 Section 275(d) further provides that "[amy regulations necessary to enforce this
subsection shall be issued initially within 6 months after the date of enactment of the
Telecommunications Act of 1996."
2. In the Notice, we tentatively concluded that, for the purpose of the Section 275(d)
ban, a customer's authorization for a carrier to gain access to its CPNI under Section 222(c)(1)
does not extend to any records concerning the occurrence of calls received by alarm monitoring
service providers.6 We noted that call content information is not considered CPNI, but that,
pursuant to Section 275(d), local exchange carriers (LECs) may not record or use information
about the content of calls received by alarm monitoring service providers in connection with
marketing such services.7 We sought comment on what procedures LECs should develop to
comply with Section 275(d).8 We also sought comment regarding the Commission's jurisdiction
over intrastate aspects of alarm monitoring data.9
3. In this order, we affirm our tentative conclusion that customer authorization to
obtain access to CPNI pursuant to Section 222(c)(1) does not extend to any CPNI subject to the
Section 275(d) ban. We conclude, however, that no regulations are necessary at this time to
implement or enforce Section 275(d). We intend to address the other issues raised in the Notice
in a subsequent order in this proceeding.
II. PLEADINGS
4. More than 50 parties submitted comments or reply ôomments in response to the
Notice.'° Of these, eight parties addressed Section 275(d), some only in passing.'1 Parties
47 U.S.C. § 275(d).
$
	
Id.
6
	
Notice at ¶ 47.
Id.
g
	
Id.
Id.atl8.
Appendix A for a list of commenting parties.
" AICC Comments at 5-7; AICC Reply at 3-6; Ameritech Comments at 20-21; BellSouth Comments at 2,
n.5; CaPUC Comments at 4-5, 7-8; Comptel Comments at 8; Excel Comments at 2-3; MCI Comments at 24-25;
SBC Comments at 19.
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characterize Section 275(d) as a flat prohibition on the use of information regarding the
occurrence or contents of calls to alarm monitoring service providers for any marketing
purpose,12 and several describe the provision as self-executing and self-explanatory.'3 Other
parties describe the obligations imposed by Section 275(d) as independent of, and in addition to,
those imposed by Section 222. " A number of the commenters agree with the Commission's
tentative conclusion that a customer's authorization to obtain access to CPNI under Section
222(c)(l) does not extend to information concerning the occurrence of calls received by alarm
monitoring service providers.'5 MCI states that thta subject to the Section 275(d) prohibition
may not ever be used or disclosed by LECs, even if the alarm monitoring service provider
appeared to approve such disclosure.'6
5. A number of the commenters state that the Commission does not need to
promulgate regulations to enforce Section 275(d).'7 Ameritech argues that LECs already have
adequate procedures in place to guard against misuse of information concerning the occurrence
or contents of calls made or received by all LEC customers, not just alarm monitoring service
providers.'8 With respect to Section 275(d)' s application to call content, Ameritech argues that
there are already criminal sanctions against carrier disclosure of the contents of interstate
communications, so that further efforts or procedures to enforce Section 275(d) are
unnecessary.'9 SBC argues that the costs of complying with specific regulations would outweigh
the benefits, given that only a small percentage of alarm monitoring customers are identifiable
as such to the LEC.2°
,
	
AICC Comments at 5; AICC Reply at 3; CaPUC Comments at 4-5.
AICC Comments at 6; BellSouth Comments at 2, n.5.
' Comptel Comments at 8; AJCC Comments at 5-6.
AICC Comments at 5-6; AICC Reply at 3; Ameritech Comments at 21; MCI Comments at 25; SBC
Comments at 19.
16 MCI Comments at 25.
Ameritech Comments at 20-21; BellSouth Comments at 2, n.5; MCI Comments at 25; SBC Comments
' Ameritech Comments at 20. Ameritech concurs with our conclusion that call content information does not
constitute CPNI.
	
Notice at ¶ 47.
Ameritech Comments at 21 (citing the Electronic Communications Privacy Act of 1986, 18 U.S.C.
§ 2510-2520, 2701-2709); see also MCI Comments at 25.
SBC Comments at 19. SBC states that a LEC can only identify as alarm monitoring service customers
those that subscribe to an alarm circuit, but that these customers comprise less than 3% of the total number of
existing monitored alarm services. SBC further asserts that at least 25% of residential alarm systems are not
monitored (in other words, these systems are not connected to the public switched network), and that the vast
majority of monitored alarm services use the switched network in a manner that does not allow them to be identified
12
13
17
at 19.
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6. Two parties addressed the jurisdiction issue raised in the Notice, regarding
whether the data safeguards provisions of Section 275(d) or the CPNI provisions of Section 222
by themselves give the Commission jurisdiction over both interstate and intrastate use and
protection of customer information. Excel believes that those sections do confer upon the
Commission jurisdiction over both interstate and intrastate use of CPNI and similar
information.2' CaPUC disagrees, and argues that neither the 1996 Act itself nor the Joint
Explanatory Statement support an interpretation that Section 275(d) or Section 222 confer upon
the Commission jurisdiction over intrastate aspects of customer information.
7. Of the parties that commented on Section 275(d), only one, AICC, argued that
the Commission should adopt specific regulations. AICC states that it represents the majority
of the alarm security services in the United States, and that its members are dependent on LECs
for essential services in order to provide their alarm monitoring services. AJCC asserts that
there are several ways in which a LEC could use information it receives through its provision
of local services to target alarm monitoring customers, including: 1) identifying users of private
line alarm circuits or derived local channel services; 2) canvassing subscribers' outbound call
records to identify calls to alarm providers' central stations; or 3) capturing customer telephone
numbers from records of the incoming cafls received by an alarm provider. AICC contests
SBC's claim that most alarm monitoring customers are "unknown to the serving LEC, stating
that LECs that are aware of the telephone numbers of alarm monitoring central stations could
easily identify the subscribers making calls to such numbers.
8. AICC argues that the Commission should adopt several rules to implement Section
275(d). First, AICC urges the Commission to adopt a rule which essentially restates the
statutory ban set forth in Section 275(d). Second, AICC advocates a rule specifying that
customer approval of access to CPNI does not authorize carriers to obtain access to data covered
as such by a LEC.
21 Excel Comments at 2-3.
CaPUC Comments at 7-8.
n AICC Comments at 2. AJCC states that typical monitored alarm systems use either private lines, derived
channel technology, or calls placed over the public switched network - all of which are generally supplied by a
LEC - in order to transmit information from a customer's premises to the alarm monitoring provider's facilities.AICC Comments at 3-4; AJCC Reply at 2.
' AICC Comments at 2-3; AICC Reply at 2.
AICC Reply at 4.
' Specifically, AICC proposes that we adopt a rule that states, "A LEC may not record or use in any fashiondata concerning the occurrence or contents of calls received by a provider of alarm monitoring services for thepurpose of marketing alarm monitoring services, whether its own services, an affiliate's services, or those of any
other entity.' AICC Reply at 4 and Attachment A.
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by Section 275(d). Third, AJCC recommends a rule requiring LECs to deny access to CPNI
to LEC personnel (or personnel of a LEC affiliate) with responsibility for the marketing of alarm
monitoring services, because CPNI may contain information covered by Section 275(d).
Fourth, AICC argues that the Commission should adopt expedited procedures for complaints
alleging violations of Section 275(d), similar to the expedited procedures for complaints alleging
violations of Section 275(b) that the Commission is required to establish pursuant to Section
275(c)? In support of this argument, AJCC asserts that Section 275(d) violations involve the
same competitive concerns as Section 275(b) violations and may cause immediate and irreparable
harm to alarm monitoring service providers.30
UI. DISCUSSION
9. After review of the comments and replies received in this proceeding, we affirm
the tentative conclusions regarding Section 275(d) that we set out in the Notice. Thus, we
conclude that Section 275(d) restricts LEC personnel from using information regarding "the
occurrence or content of calls received by providers of alarm monitoring services" for the
purpose of marketing their own alarm monitoring service, or an alarm monitoring service
offered by another affiliated or unaffihiated entity. Information on the occurrence of such calls
may constitute CPNI, if it is made available to the LEC solely by virtue of the customer-carrier
relationship. We affirm our tentative conclusion that, even if a carrier has received customer
authorization to obtain access to CPNI pursuant to Section 222(c)(1), such authorization does
not extend to any CPNI subject to the Section 275(d) ban, namely information concerning the
occurrence of calls received by alarm monitoring service providers used for marketing purposes.
We note that four parties have specifically concurred with this conclusion, and no parties have
expressed disagreement with it.
10. Based on the record, we conclude that no regulations are necessary at this time
to implement or enforce Section 275(d). Specifically, we declihe to adopt any of the four rules
Zi AICC Comments at 6; AICC Reply at 4 and Attachflient A.
AJCC Comments at 6-7; AICC Reply at 4-5 and Attachment A.
AJCC Comments at 7; AICC Reply at 5. Section 275(b) provides that incumbent LECs engaged in the
provision of alarm monitoring services shall provide network services to nonaffihiated entities on nondiscriminatoiy
terms and conditions, and shall not directly or indirectly subsidize their alarm monitoring services from telephone
exchange service operations. Section 275(c) requires the Commission to establish procedures for expedited
consideration of complaints concerning violations of Section 275(b) or the regulations thereunder that result in
material financial harm to an alarm monitoring service provider.
° AICC Comments at 7.
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proposed by AICC.3' The first such rule is a paraphrase of the prohibition set out in Section275(d). We conclude that codification of the statutory prohibition in such a rule is unnecessarybecause the statutory prohibition is clear on its face.32 The second proposed rule, specifying that
customer approval of access to CPNI does not authorize carriers to obtain access to data coveredby Section 275(d), merely restates an interpretation of the statute that we set forth as a tentative
conclusion in the Notice, and that we affirm in this order. We do not see the need to codify thisinterpretation in the form of an additional nile..
11. The third rule proposed by AICC would require LECs to deny access to all CPNIto personnel with responsibility for the marketing of alarm monitoring services, because theCPNI may contain information covered by Section 275(d). We decline to adopt this proposed
rule. While AICC's proposed rule sets forth one method by which LECs may ensure that they
are in compliance with Section 275(d), there may be less burdensome methods of ensuring
compliance with the statute. Further, AICC's proposed rule would extend beyond the statutoryprohibitions of Section 275(d). Section 275(d) only restricts use of information (i.e., CPNI)
related to the occurrence of calls received by alarm monitoring service providers for the purpose
of marketing such services. AICC' s proposed rule, however, would prevent LEC (or LEC
affiliate) alarm monitoring marketing personnel from obtnining access to all CPNI for anypurpose. Section 222 sets forth limitations on the ability of telecommunications carriers, their
affiliates, and unaffiliated parties to obtain access to CPNI, and we conclude that it is not
necessary to bar completely certain of these entities from access to. CPNI simply because they
engage in marketing alarm monitoring services. Moreover, we conclude that it is more
appropriate to examine whether any restrictions on access to CPNI are necessary to effectuatethe Section 275(d) prohibition at the same time we examine whether to impose specific
safeguards to protect against unauthorized disclosure of restricted CPNI. Thus, we leave thisdetermination to our subsequent order in this proceeding.
12. Finally, we decline in this order to adopt expedited procedures for complaints
alleging violations of Section 275(d), as suggested by AICC. We expect to adopt expeditedprocedures for complaints concerning violations of Section 275(b), as required pursuant toSection 275(c), in: a separate proceeding. There is no similar statutory mandate to adopt
expedited procedures to enforce Section 275(d). Moreover, we note that the statute only
mandates expedited review of Section 275(b) complaints "that result in material financial harm.
3
	
See8.
32 We note that in Section 701(a)(2) of the 1996 Act, Congress specifically directed the Commission to adopt
regulations that conform to statutory provisions. Policy and Rules Governing Interstate Pay-Per-Call andTelephone Disclosure and Dispute Resolution Act, CC Docket Nos. 96-146 and 93-22, Order and Notice ofProposed Rulemaking, FCC 96-289 (rel. July 11, 1996). There is no such specific congressional direction inSection 275(d).
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to a provider of alarm monitoring setice,"33 whereas AICC proposes expedited review for allSection 275(d) complaints. We find no basis in the 1996 Act for adopting expedited procedures
specific to Section 275(d) complaints.
13. In addition, we decline to address any issues raised by parties related to the scope
of our authority over intrastate alarm monitoring data, in light of our decision not to adopt any
regulations to enforce Section 275(d). We note that parties who have commented upon the
authority conferred on us by Section 275(d) have done so in conjunction with their analyses of
the authority conferred on us by Section 222. We conclude that it would be more appropriate
to address all issues relating to the scope of our authority with respect to customer informationin our subsequent order in this proceeding.
IV. PROCEDURAL ISSUES
A.
	
Regulatory Flexibility Analysis
14. As required by Section 603 of the Regulatory Flexibility Act, 5 U.S.C. § 603(RFA), an Initial Regulatory Flexibility Analysis was incorporated in the NPRM in this
proceeding. The Commission sought written public comments on the proposals in the NPRM,including the Initial Regulatory Flexibility Analysis. Because the Commission is not adopting
any regulations at this time to enforce Section 275(d) of the 1996 Act, no further RegulatoryFlexibility Analysis is required at this time.
B.
	
Paperwork Reduction Act
15. As required by the Paperwork Reduction Act of 1995, Pub. L. No. 104-13, the
NPRM in this proceeding sought comment from the general public and the Office ofManagement and Budget regarding the information collections contained in the NPRM.
Because the Commission is not adopting any regulations to enforce Section 275(d) of the 1996
Act, no further Paperwork Reduction analysis is required at this time.
47 U.S.C. § 275(c).
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V. ORDERING CLAUSE
16. Accordingly, iT IS ORDERED that, pursuant to Sections 1, 4, and 275 of the
Communications Act of 1934, as amended, 47 U.S.C. § 151, 154, and 275, the REPORT AND
ORDER is hereby ADOPTED.
FEDERAL COMMUNICATIONS COMMISSION
William F. Caton
Acting Secretary
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