Enacts telecommunications privacy law containing provisions regulating the collection, use or disclosure of information by telecommunications carriers

Effects of present law which this bill would alter

There is no comprehensive privacy protection for all telecommunications customers at either the federal or state level. There is some piecemeal legislation which applies to limited spheres of telecommunications and which provides fewer protections than the instant bill. SEE, E.G., 47 U.S.C. §551 (cable subscriber). Section 702 of the Federal Telecommunications Act of 1996 did create protection for "customer proprietary information" (CPNI) possessed by a telecommunications carrier. However, the Act's definition of CPNI suggests that it applies only to telephone common carriers.

Justification

The technologies and applications of telecommunications are increasing at a dizzying pace. It is commonly understood that an "information superhighway" will soon be here. New kinds of two-way, interactive communications will be a key element to the new telecommunications infrastructure. With these changes the ability to collect, correlate, analyze and distribute data is also increasing exponentially. This creates the serious potential for injury to the personal privacy of individuals. There is no comprehensive privacy protection for all forms of telecommunications at either the federal or state level.

This bill would create a "Telecommunications Privacy Law" that applies to all telecommunications carriers, including telephony, cable television, wireless video and voice technologies, and even to technologies that are just now being implemented such as "open video systems" operated by traditional telephone companies, and wireless data services. The primary reason for protecting personal privacy is that privacy is a good unto itself and deserves protection. The United States and New York State constitutions both provide bottom line protections for privacy. Providing further protection is an appropriate subject for legislation.

An additional constitutional interest that deserves statutory protection is the First Amendment right to freely receive and disseminate information without the chilling effect of enabling others to trace one's ideas, opinions or buying habits. SEE R. Givens, Practice Commentaries to GAL § 670, McKinneys' 994 Pocket Part, p. 308. The rationale for this bill is substantially similar to the rationale for the Video Consumer Privacy Act which applies to video tape sales and rental, and which was enacted in 1993. GAL § 670.

The dangers to privacy posed by advancing telecommunications technologies were noted by the Governor's Telecommunications Exchange. In its report, the Exchange favorably commented on the Public Service Commission's privacy principles and noted that legislative action would be appropriate to strengthen those principles' force and effect, as well as to broaden their application to non-regulated telecommunications services. CONNECTING TO THE FUTURE: THE REPORT OF NEW YORK'S TELECOMMUNICATIONS EXCHANGE ; at 29-31 (December, 1993).

A secondary, utilitarian reason for protecting personal privacy is to assist the growth of the telecommunications industry in New York. If the chilling effect is removed, potential customers are considerably more likely to use new telecommunications services. More customers should mean a better business environment for telecommunications companies in New York. A comprehensive privacy law should have the additional benefit of subjecting all telecommunications carriers to the same essential privacy rules, thereby creating a desirably level playing field on this subject.

The bill would protect individuals' privacy without unduly handicapping telecommunications carriers' ability to conduct their business. The central component of the bill is PSC §104-c, which would govern when a carrier could collect, use or distribute personally identifiable information. Doing so for the ordinary conduct of business would be permitted. A carrier could collect, use and disclose for other purposes, but only if the customer has consented. The rationale is straightforward--a person should be able to control the flow of information about himself or herself. Other provisions specifically allow carriers to use particular kinds of information without endangering privacy. These include traditional telephone directory information, system integrity tests, aggregate data, court orders and "otherwise pursuant to law." This last provision recognizes that specialized, narrow rules for specific telecommunications services may be developed at the federal level. The "otherwise pursuant to law" provision allows for such specialized rules, but make them the exception to a general rule of privacy.

The basic principle of individual control over personal information also gives rise to the rules on carrier notice of information practices (§ 104-d), and to the rules entitling a subscriber to inspect and correct information (§ 891). Third parties who receive personally identifiable information for a telecommunications carrier would be subject to essentially the same rules that apply to carriers. If they were not, the bill's purpose could too easily be circumvented by a seemingly limited disclosure to a third party which could then distribute the information to the whole world. The development of interactive communications is increasing the threat of monitoring and intercepting individuals' communications. Monitoring refers to practices such as the recording of viewing habits or of the parties with whom a subscriber communicates. Interception refers to recording the actual contents of the communication. Section 104-g of the new article would protect individuals from these particular kinds of privacy invasions. Enforcement would be achieved by court actions brought by the attorney general for injunctions and fines or by private citizen seeking damages.

Fiscal implications

None.

Effective date

The first of July next succeeding the date on which it shall have become law.