Whittle, Robert --- "Calling number display: AUSTEL's PAC sets conditions" [1996] PrivLawPRpr 31; (1996) 3(3) Privacy Law & Policy Reporter 45

---

Calling number display: AUSTEL's PAC sets conditions

Robert Whittle

The PAC's CND report places three major conditions on an `opt-out' CND introduction:

(i) an extensive public education campaign before introduction;

(ii) a set of `voluntary guidelines', mainly concerning the use of information generated by CND; and

(iii) an `opt-in' approach to existing silent line customers.

Public education condition

Firstly, the CND service will allow the display of the numbers of customers in a given area only after an extensive public education campaign and after they have been given the opportunity to request their line be configured to normally not allow the display. The public education campaign must be paid for by the carriers, meet AUSTEL standards and achieve an `80 per cent awareness level' before the CND service can commence.¹ This level must be reached in the general population, and in all of the six subgroups identified in the report: rural and remote consumers; older people; young people; people from non-English speaking backgrounds; people with disabilities ; and silent line customers.

The public education campaign must provide information on at least 22 separate issues, but the awareness test relates to knowledge of the basic operation of CND, the potentially negative privacy consequences of disclosing the caller's number and how to `block' the display of the number on a per-call or per-line basis. (The term `block' is a convenient but prejudicial term -- implying that it is unnatural to make calls without a displayable number.)

Telstra has stated that the display service -- which in the US costs around US$6 a month -- has little attraction for consumers once less than 80 per cent of calls have displayable numbers.² Calls from pay-phones, and from any phone service from which the caller cannot use the `do not display' prefix, will not have displayable numbers. So any further reduction due to silent line customers retaining their default non-display status and to other customers requesting a non-display status as a result of the public education campaign, will detract from the commercial viability of the service.

AUSTEL's extensive research (which may not completely cover non-English speaking jurisdictions) found no other existing or proposed CND regulatory regime which required a public education campaign with a success criteria based on testing levels of public awareness. The June FCC ruling considered such testing, including a proposal for an 85 per cent awareness level, but concluded that other public awareness campaigns had been `successful' and that it was sufficient to use complaints as a means of monitoring the effectiveness of the campaign.³

The PAC's public education campaign and awareness requirements seem to be far more extensive than in any other jurisdiction.

The 80 per cent awareness requirement

Although the PAC does not spell out the reasons for its choice of this percentage, it is clearly a high figure in terms of how difficult it will be to achieve -- especially amongst the six subgroups. This is a much higher awareness level than that reported in Wauchope, or amongst Canadian consumers. The Californian Public Utilities Board, in evidence to the FCC states that `despite its extensive public education requirements, thirty percent of customers will not understand how to (stop their number from being displayed)'.⁴

However, 80 per cent is low in privacy terms, since even 15 per cent of the population being unaware of CND's problems or of how to control the display of their number would entail Telstra disclosing, on a daily basis, the personal information of over a million Australians who are unaware of this breach of their privacy and/or are powerless to stop it. The concept of `informed choice' was the most important guiding concept in the PAC's work, but the its report is a compromise which allows a significant minority of the population to be uninformed and consequently to have no choice at all.

`Voluntary guidelines' condition

The second precondition is a set of voluntary guidelines for the organisational use of CND. Other than the threat of legislation, or any private sector privacy laws which may be introduced in the future -- there is no way of enforcing these guidelines. Even with legislation, it would be almost impossible to enforce proper handling of CND information -- which makes it all the more important to ensure that the display of a caller's number is never allowed without their well informed, explicit consent.

These guidelines are generally sensible and involve provisions for not using or selling CND related data without the consent of the data subject. The guidelines warn that the caller may not be the customer whose telephone service the number identifies, and contain extensive provisions for verbally checking the caller's identity before revealing personal information or proceeding with transactions. Since these privacy measures necessarily entail detailed verbal interchanges, in many cases there seems little point in using CND -- it would be easier to ask the person their name.

In other cases, CND information could be used to build a bond of trust -- as evidence of the caller's bona-fides, or as a means, for instance, of deterring or pursuing callers who place hoax orders for two dozen pizzas. The report fails to note that opt-in CND would be just as effective as opt-out for these transactional and trust building interactions where the call is part of a conscious effort to enter into a business arrangement.

Unfortunately the guidelines allow organisations to use the CND to place return calls to the source of incoming calls which were not answered -- thus encouraging organisations to make blind-callbacks when they fail to promptly answer calls from the public. Telstra believes that most people would accept, on the balance, that such call-backs were beneficial.

Silent line condition

The third condition is that for existing silent line customers, the display of their number will be opt-in. Telstra's 800,000 or more⁵ silent line customers must have their lines configured as `opt-in' -- not to allow the display of their number, unless they explicitly request it be displayed by dialling a special prefix before the number they are calling, or by requesting that their line be configured to normally allow display.

During the introduction of CND and when customers subsequently first acquire a silent line or change their number or carrier, they will be asked to make a choice between their line normally allowing or not allowing the display of their number to the people they call. The lines of customers who do not express a preference will default to not allowing the display of their number.⁶

This protection for silent line customers is similar to that proposed in the Netherlands and in Germany, and which until recently has been enforced in California. In the latter case, where 44 per cent of subscribers had unpublished numbers, the carrier Pacific Bell decided not to offer a Caller ID service because it believed that too few calls would have displayable numbers. This policy was over-ruled by the FCC in June 1995 and an appeal in November upheld the FCC's decision.⁷

Telstra's dissenting view

Attachment G of the report contains Telstra's dissenting view on the opt-in transitional arrangements for its silent line customers, and the consumer representative's response. Telstra stated that privacy -- in this case of its silent line customers who pay $32 per-annum for the company to keep their number secret -- `should be balanced against the need to contain costs, encourage beneficial technical growth, and sustain utility to the end user and commercial viability to the company.'

That Telstra considered that it should trade off the privacy of customers is bad enough, but its desire to sell the numbers of silent line customers without their explicit consent goes against all common sense. In the near future, when billions of dollars of revenues will divided between competing carriers according to how consumers feel about the companies -- including how much they trust them -- it is extraordinary that Telstra thinks that it can profit in the long term by degrading its customers' privacy without their clearly expressed permission.

In discussing this with Michael Pickering, I noted that Telstra cannot choose its current or potential customers -- it is bound by regulation to offer services to all Australians. Pickering agreed, adding that since the company currently does serve almost all Australians, Telstra had only customers to lose due to privacy or other problems and that therefore the onus is on Telstra to give full consideration to potential problems. Citing Telstra's well developed privacy policy and audit process, he said that due regard should be given to Telstra's careful analysis of these silent line customer issues, which were based on the company's confidence that it could properly reach these customers with educational material and raise their awareness sufficiently.

When asked how Telstra could justify selling the personal information -- the phone numbers -- of its silent line customers without their explicit permission, he objected to the term `selling'. Whilst agreeing that the caller's number very often was personal information, he said that `disclosing' was a better term since the company charged a monthly fee for the service rather than charging directly for each number which was displayed.

He argued that because silent line customers had already made a positive choice regarding privacy, they were well placed to respond to the public education campaign and information specifically mailed to them -- by actively choosing to opt-out of displaying their number on a per-line or per-call basis. I pointed out that while this may be true of some `well connected' silent line customers, many customers chose the silent line service in response to Telstra's suggestion when they reported a malicious call, so there would be some who were not well connected with the media or printed information due to language, literacy or other barriers.

After agreeing that silent line customers were not necessarily ideally placed to understand or act on the material intended to inform them about CND, Pickering said that `Over time, the level of awareness of CND would continuously increase and would reach a very high level. Some of this would be a result of unaware callers subsequently discovering their number had been displayed' -- although where this involved privacy problems, he said `Once is too many times.'

He said that Telstra would work with community organisations to raise the awareness of CND, and that the PAC's 80 per cent awareness requirement represented a minimum, which the company would continue working to improve upon. A staggered introduction, by state or by city, would enable the public education campaign to be fine tuned and for awareness to spread to other areas.

Many privacy proponents wonder at the huge expense of a public education campaign in an opt-out scenario and ask why, if CND is so good, shouldn't the carriers introduce it on an opt-in basis and spend the money convincing callers of the benefits of allowing the display of their number. In California (with about 65 per cent more people than Australia) US$38 million is being spent to `inform consumers about their rights under the new Caller ID program'.⁸

The Attachment G dissenting opinion shows that, even after a four year debate with privacy advocates and after losing its fight make silent line customers opt-out as well, some within Telstra still viewed its customer base as a source of information which can be sold without explicit consent, rather than as individuals with privacy interests that the company would profit from respecting.

Asked about the status of this dissenting view, Pickering stated that Telstra accepted the PAC's requirement that silent line customers be opt-in -- their services would default to not allowing the display of their number if they did not make an explicit choice.

Conclusions

If CND was introduced in Australia as AUSTEL's PAC report recommends, there would still be serious privacy problems resulting from opt-out's social norm of casual disclosure and from further unwanted disclosure of personal information due to ignorance, accident or inconvenience. It would be impossible to adequately prevent the misuse of CND information, or to prevent unwanted blind call-backs -- which are often invasions of privacy and may lead to personal matters concerning the caller becoming known to others in the family or workplace who answer the phone instead of the original caller. CND would not significantly deter or detect malicious calls, or unwanted calls from telemarketers. So from a privacy point of view, the report's support for opt-out and its over-estimation of the benefits of CND leaves a lot to be desired.

The report suggests a variety of applications for CND, but hardly considers alternative approaches which have fewer privacy problems -- such as answering machines, voice mail and Call Trace, the latter two of which require no customer equipment. Nor does it contain a comprehensive analysis of CND's benefits and problems. For instance it makes no mention of the changes to telephone usage which would probably follow a CND introduction -- such as fewer calls being answered, and more being made. Nor does it investigate the change in telephone culture which CND is expected to cause.⁹

The report reflects the tension between the differing perspective's of the carriers and privacy advocates. The public awareness provisions are a vast improvement over those of all overseas jurisdictions which AUSTEL has been able to research. The insistence on opt-in for silent line customers is the same as the recently over-ruled California's requirement, and comparable to the planned introductions of CND in Germany and the Netherlands¹⁰ -- in which the services of all silent line customers are automatically set to not allowing the display.

The PAC report notes that privacy provisions for Caller ID in the US have generally been improved -- although the FCC's override of California's unpublished number customer protections goes against the trend. The corollary of this is that phone companies and regulators have consistently underestimated the privacy problems of CND. To AUSTEL's credit, the CND debate in Australia has been long and relatively deep -- compared to the hasty introduction in Canada and the inconsistent, state-by-state introduction in the US.

With further debate, and careful analysis, Telstra and Optus may make a decision on CND introduction based on a realistic assessment of CND's value and costs -- both indirect costs resulting from privacy problems and the costs of a public education campaign which attempts to minimise the problems inherent in an opt-out introduction.

The debate has been a lesson in how a relatively simple technology can have far-reaching privacy and social effects, and how proponents of the technology can continue to push it whilst overestimating its value and paying little attention to the foreseeable problems. CND is relatively simple compared to the many new modes of personal information interchange based on the Internet, and on the broadband services of the near future.

Most qualitative respondents' in the Wauchope trial thought that $30 was too high a price for a CND display unit and considered that $9 per quarter was too much to pay for the display service.¹¹

Even if the business case looks positive, it is a service which requires a wholesale change to the phone network and significant privacy risks. CND has relatively modest prospects for revenue and market penetration, compared to the immense opportunities and challenges of Internet services -- for which many people pay several dollars per hour -- and the flourishing mobile services and broadband services of the near future.

While the US market's acceptance may encourage Australian carriers to introduce CND here, it cannot be assumed that policies which are entrenched or introduced as a fait-accompli in one culture would be welcome or successful in another. For instance the US approach to gun control would be rejected here. Australian's generally find other people to be less threatening and prefer government and systematic approaches, rather than problematic personal defences, for most of the protection they need. While CND is a far less serious problem than hand-guns in the cause of personal safety, its usefulness in protecting privacy is just as illusory.

Robert Whittle is a consultant on hardware, software and human interaction in telecommunications and music, and a consumer advocate on telecommunications policy.

Contacts:
Home page: http://www.ozemail.com.au/~firstpr
e-mail: [e-mail]

---

1. Chapter I, 1.2; Attachment B, 4 and 6.

2. Attachment G.

3. http://www.fcc.gov/Bureaus/Common_Carrier/Notices/fcc95187.html paras 91 and 135 to 140.

4. http://www.fcc.gov/Bureaus/Common_Carrier/Notices/fcc95187.html para 91.

5. Chapter III, 1.3 -- silent line customers comprise about 16 per cent of residential customers in Melbourne and Sydney and an average of 12 per cent in country areas.

6. Chapter IV, 4.3 to 4.5; Attachment A Principles and requirements 16.

7. The FCC decision is at http://www.fcc.gov/Bureaus/Common_Carrier/Notices/fcc95187.html. The appeal judgement is at http://www.callaw.com/9470197.html . These are the most recent significant Caller ID decisions in the US and contain considerable background information.

8. Bailey, `They've got your number' San Jose Mercury, 24 February 1996 http://www.sjmercury.com.news/local/id224.htm

9. Sterley and Associates, Wauchope Caller ID Trial , p 98.

10. Attachment F, B 2 and 3.

11. Sterley and Associates, Wauchope Caller ID Trial, pp 111 and 112. More respondents to the quantitative survey were prepared to pay the relatively low prices tested for.