Verizon, Ameritech Get Heat Over Permitted Data Sharing

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Michigan Attorney General Jennifer Granholm issued a consumer alert yesterday about Verizon and Ameritech each sharing customer account information among their subsidiary companies and divisions, even though the practice is legal.


"You may need to act quickly if you wish to exercise your right of control to the use of your private account information," Granholm cautioned consumers.


Granholm said Verizon and Ameritech customers should look for material in their monthly bills informing them of ways to opt out of having their account information shared. If consumers failed to respond, she said, the companies would be able to share the information for marketing purposes.


The Federal Communications Commission allows consumers to opt out of having their telecommunications providers use their account information. Granholm and other attorneys general had asked the FCC to adopt an opt-in approach instead, and the issue is expected to come under FCC review again later this year.


Telecommunications providers are forbidden to share customer account information with third parties except in the case of telephone-directory makers, said Bill Kula, spokesman for Verizon, but sharing with other business units of the company helps telecommunications providers better target offers to their own customers. For example, information sharing becomes useful when Verizon's broadband unit wishes to market DSL Internet services to long-distance customers.


Granholm has urged Verizon and Ameritech to follow the example of Qwest Communications International, which last month said it would stop sharing data completely. The decision came after Qwest received a flood of complaints reacting to opt-out notifications on billing inserts to 12 million customers.


Consumer groups and state officials, including the Washington attorney general, criticized Qwest for not displaying the opt-out information more prominently. Verizon customers have not experienced any such confusion, so Verizon has decided against following Qwest's lead, Kula said.


"We intend to make it very clear through our customer notices that customer account information would be shared within Verizon business units only," he said. "It is not shared with outside organizations."


Sharing customer account information among business units can benefit consumers, said Denise Koenig, spokeswoman for Ameritech. It reduces customer service call times by allowing service agents to have access to all the information the company has on a customer.


"The opt-out approach allows us to improve customer service," she said. "It allows us to make more meaningful suggestions when we talk to our customers about their needs."


Verizon is currently sending billing inserts informing consumers of ways in which they can opt out of having their account information shared with its other business units, Kula said. Some consumers already have received the inserts, while the rest will get them in the next few weeks.


Of Verizon's 64 million customers in 33 states, only those in Washington, where the confusion began, will not be mailed immediately, Kula said. The billing inserts are being delayed until furor over the Qwest billing inserts dies down.


In addition to sending billing inserts giving customers the chance to opt out, Ameritech, a subsidiary of telecommunications giant SBC Communications, uses an interactive voice response system to obtain customer permission to access account information on inbound calls, Koenig said. Customers who call in hear a recorded message asking them for permission to access their records, to which they can reply by pressing the keys on their touch-tone phones.


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