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Order CRTC 2001-208

  Ottawa, 9 March 2001
 

CRTC approves changes proposed by Bell Canada to broaden the scope of 976 service

  Reference: Tariff Notice 6546
1. On 15 December 2000, Bell Canada under Tariff Notice 6546, filed proposed changes to General Tariff Item 4970, 976 Service, which proposed to broaden the scope of permitted programs and to introduce 976 Caller Identifier as an optional feature.
2. Bell Canada also filed for approval proposed amendments to the 976 Service Provider Agreement (SPA) and Accounts Receivable Management (ARM) Agreement which incorporated the proposed changes.
3. Bell Canada proposed to broaden the scope of 976 Service by permitting the provision of services or value in telephone calls subsequent to a 976 call (subsequent value programs or SVP). SVP include as a sub-category, Personal Identification Number (PIN) applications, in which a PIN is assigned during the 976 call to allow access to the SVP. For all subsequent value calls, the 976 number is used to purchase entitlement to a fixed block of time on a variety of telephone-delivered services.
4. Bell Canada also proposed to provide 976 Caller Identifier on an optional basis for 976 program numbers by incorporating by reference, in its tariff, the Caller Identifier feature associated with 900 Service and by applying a charge of $25 per 976 number and associated service charges.
5. Bell Canada further proposed that the program description provided by the Service Provider, as part of its application, must include a complete list of any and all telephone numbers through which services or value may be accessed, and that this description must be promptly updated as necessary.
6. On 30 June 2000 the Commission issued Order CRTC 2000-612 which approved, on an interim basis, the introduction of subsequent value programs for Advantage 900 Service (900 Service).
7. On 8 August, the Commission issued Public Notice CRTC 2000-114 which sought comments on proposed safeguards associated with 900 Service subsequent value programs.
8. The Commission received one comment on PN 2000-114 supporting the application. In Order CRTC 2001-207 issued today, the Commission has approved similar changes to 900 Service.
9. Bell Canada submitted that there now is significant demand among 976 Service Providers for allowing subsequent value programs on 976 Service. Bell also submitted that, in light of its experience with SVP on 900 Service, it is of the view that it is now appropriate to broaden the scope of 976 Service by permitting SVP.
10. The Commission considers that the proposals by Bell Canada for broadening the scope of 976 Service by permitting SVP are appropriate.
11. The Commission is of the view that such proposals, together with the disclosure requirements referred to in paragraph 5 above, will benefit 976 Service providers and their customers. The Commission also considers that the optional 976 Caller Identifier, together with the current per-call limit of $15 for most calls, will provide a means to manage the potential risk associated with the use of SVP, including potential chargeback levels.
12. The Commission notes that, under the ARM Agreement, caller charges that are reasonably disputed pursuant to Bell Canada's collection procedures for 976 Service and pertain to calls made before a caller has had the opportunity to avail himself or herself of call blocking for 976 Service, are waived by Bell Canada and are absorbed by the Service Provider.
13. Information acquired by Service Providers under the optional 976 Caller Identifier should not be used by Service Providers to attempt collection of those caller charges identified in paragraph 12. The Commission considers that the remedies contained in the ARM Agreement and in the SPA should be available in such cases.
14. Accordingly, the Commission approves the changes proposed by Bell Canada in TN 6546 together with the associated changes to the SPA and the ARM Agreement.
  Secretary General
  This document is available in alternative format upon request and may also be examined at the following Internet site: www.crtc.gc.ca 
 

Dissenting opinion of Commissioner Stuart Langford

  I disagree with the majority decision and would have denied this application. This Order, as innocuous as it may appear to the uninitiated, could have unexpected and unpleasant consequences for Canadian consumers. The Order's title speaks of "changes proposed by Bell to broaden the scope of 976 service." What is being "broadened" as a result of the majority decision is "the scope" for 976 service providers to bypass the consumer protection mechanisms put in place over the years by the Commission. Before examining that undesirable possibility, however, a few paragraphs of historical perspective might be helpful.
  The 976 network, how it operates and how users pay for the services it carries, was described in Telecom Decision CRTC 89-14 as follows:
 

"976 Service permits Bell Canada (Bell) customers to dial recorded or live announcements provided by 976 Service sponsors. The sponsors lease facilities from Bell that permit the completion of calls to the 976 announcements. Telephone users who dial 976 numbers within their own Numbering Plan Area (NPA) are billed non-tariffed charges determined by the sponsors. Users who dial 976 numbers in other NPAs are billed the applicable message toll service charges, rather than the non-tariffed charges set by the sponsors.

 

"Bell and each 976 Service sponsor enter into an Accounts Receivable Management (ARM) Agreement whereby Bell purchases the sponsor's accounts receivable on an on-going basis. Bell then acts as the sponsor's billing agent and bills customers for all charges related to the calls, including the sponsor's non-tariffed charges. Under the ARM Agreement, Bell absorbs any losses associated with uncollectible charges for calls to 976 numbers"

  What the quotation above does not give readers a flavour for is the content of the "recorded or live announcements provided by 976 Service sponsors." An analysis of the latest statistics available (for the period ending December 31, 1999) reveals that almost all the hundreds of dial-in programs operated as part of Bell's 976 network offer "adult" services. A few provide government services or products such as horoscope readings and health information. The remainder, predominantly specialize in dateline and over-the-phone sex services. In an earlier CRTC proceeding, the over-the-phone sex services were described as providing callers with everything from heavy breathing to explicit descriptions of body parts and sexual acts. A customer calls a selected 976 number, listens to someone or a recording of someone whisper naughty nonsense and is billed by the minute for the experience. The bill comes not from the purveyor of these "adult" products but from Bell under the terms of an ARM agreement as described in the paragraph above.
  Incredible though it may seem, such services find a ready market among the prurient of appetite. In an earlier proceeding , it was estimated that something in the neighbourhood of 6 million 976 calls are placed each year. Unfortunately for those 976 Sponsors that provide adult products, not all who seek to satiate their appetites do so by using their own telephones. According to Bell submissions in that earlier proceeding, its file boxes are stuffed to overflowing with complaints about telephone subscribers receiving huge and unexpected bills for services rendered, not to them, but to others -- their teenage children and groups of their children's friends, for example, who, finding the family telephone unsupervised and themselves at loose ends, wile away many an entertaining hour listening to the voice on the other end of a 976 line describe every manner of unmentionable act.
  Besieged by complaints, Bell has in past proceedings attempted either to discontinue offering 976 network services or, at least, to outlaw the provision by 976 service providers of "explicit or implicit descriptions of sexual conduct." Those initiatives were denied, though over the past 12 years the Commission has put in place a number of safeguards intended to protect consumers from huge unexpected bills and from attempts by 976 service providers to collect such amounts directly rather than through Bell's accounting systems.
  Consumer protections authorized in previous Commission decisions enable customers faced with an unexpected bill for 976 calls to request that such charges be waived and that future access to the 976 network from the line in question be blocked. Amounts so waived are charged back to the 976 sponsor who until today has had no option but to absorb them as costs of doing business. If a customer requests and receives a waiver of charges but refuses blocking, that customer is responsible for all future 976 charges whether or not he or she made, authorized or had knowledge of the calls that resulted in them. With some unfortunate exceptions discussed later in this dissent, it is safe to say that this consumer protection system has served Canadians well. Today's majority decision, however, may place it in jeopardy.
  What this decision does, in a sense, is move the 976 service providers closer to Bell subscribers. Callers will no longer have to access 976 services exclusively by dialling into the 976 network. Instead, they can request a Personal Identification Number (PIN) that allows them to avail themselves of the service desired by dialling another (typically local) telephone number made available to PIN holders by the 976 service provider. By utilizing the second change, Caller Identifier, approved by today's majority decision, the 976 service provider pierces the veil of secrecy that has until now been maintained between it and Bell customers. Henceforth, though the agreement between them and Bell forbids such hands-on activity, 976 service providers will have the telephone number from which calls are made and will be positioned to take direct measures to collect accounts waived by Bell under the existing protection system.
  The majority decision reminds service providers of the long-established waiver and blocking options open to Bell customers and cautions service providers not to abuse their newly acquired powers: "Information acquired by Service Providers under the optional 976 Caller Identifier should not be used by Service Providers to attempt collection of those caller charges identified in paragraph 12. The Commission considers that the remedies contained in the ARM Agreement and in the SPA should be available in such cases." The comfort of a caution, in my view, is a poor substitute for the structural separation between callers and service providers that has been in place until today.
  The majority decision in this matter is a step backwards for consumers. Service providers, almost all of whom offer some form of "adult" product will see their profits rise as the PIN option enables them to avoid 976 network charges. They will also be in a position to contact users directly despite the majority's gentle reminder of what they "should not" do. Granted, they risk discovery if they violate their ARM Agreement, but discovery depends on customer complaints and as few Canadians are likely to know the terms of such an ARM agreement, the scope for victimizing uninformed Bell customers remains high.
  The record in another proceeding dealing with 976 service lends credence to the argument that to supply 976 service providers with direct access to customers is to increase the likelihood of those customers being subjected to unacceptable collection tactics. Under the existing ARM Agreement (Article 6.4) first time chargebacks are absorbed by the service provider but not subsequent chargebacks. In other words, as indicated earlier in this dissent, if a customer complains about unauthorized 976 charges on his or her bill, Bell will waive the charges and offer call blocking. If the customer refuses call blocking but disputes liability for subsequent 976 charges, Bell steps out of the picture and the matter of payment becomes an issue for the customer and the service provider to settle. Billing information is given to the service provider who then attempts to collect.
  Unfortunately, mistakes happen. From time to time Bell provides billing information on an initial "chargeback", an account that should be or has been waived, rather than a subsequent one and the 976 service provider's in-house collection department takes over a file it should not be dealing with. In such situations, according to Bell in the other 976 proceeding upon which I pass no judgment today, inappropriate collection techniques are too often employed:
 

"The Company continues to receive persistent complaints from Callers about collection practices associated with 976 Program calls which have been previously charged back and absorbed by a 976 Service Provider. Complaints include attempts to collect on amounts that are not owed (such as Chargebacks associated with initial disputes and amounts that were previously settled), attempts to collect a $40.00 mark-up on the amounts allegedly owed, and excessive provocation (e.g., calling as many as twelve times a day, using threatening and abusive language)."

  Bell also claims to have received "¼ complaints from Callers who are being pursued by collectors with respect to stale accounts." Some of these accounts, according to Bell, are "several years old" and impossible to prove one way or the other. In a later submission filed as part of the Public Notice CRTC 2000-23 proceeding, Bell characterized 976 service provider collection practices as "misleading and harassing" and indicated that in dealing with some 976 service providers Bell employees themselves have been verbally abused: "employees have been subject to shouting, profanity and personal insults."
  There are, in my view, too many reasons to suspect that the majority decision in this matter moves in entirely the wrong direction. It will bring 976 service providers and consumers into closer contact for administrative and collection purposes. The record of this and other 976 proceedings indicates that movement in quite the opposite direction may be what circumstances demand. Consumers are made more vulnerable by this decision; purveyors of salacious narrative are made richer and more dominant in terms of their relationship with Bell subscribers. This does not strike me as an improvement on the status quo. I would have denied this application.
1 I am prevented from providing specific numbers as that information was filed by Bell in confidence in the Public Notice CRTC 2000-23 proceedings which also deal with 976 network issues.
2 Telecom Letter Decision CRTC 92-5, at pages 6 & 7.
3 Telecom Decision CRTC 89-14 denied an application by Bell to discontinue 976 service.
4 Id., at page 10; "The company noted that during 1988, it wrote off more than 10% of billed revenues for 976 Service. Furthermore, it estimated that its business offices received over 70,000 calls from customers complaining about 976 Service."
5 Ibid.
6 Telecom Letter Decision CRTC 92-5, at page 6.
7 Majority decision, at paragraph 12.
8 Id., at paragraph 13.
9 See Public Notice CRTC 2000-23
10 Background Information filed by Bell as part of its tariff application underlying Public Notice CRTC 2000-23, at paragraph 20.
11 Id., at paragraph 22.
12 Bell Reply comments, April 7, 2000, at paragraph 36.
13 Id., at paragraph 40.

Date Modified: 2001-03-09

Date modified: