Slamming:
Not for Incumbents Only?

The downside of intense competition for new customers between rival carriers includes illicit practices like slamming. One provider is accused of acting like an ILEC while working to reconnected abandonded DSL users.

by Patricia Fusco ISP-Planet Managing Editor [January 11, 2001]

Federal regulators define slamming as the illegal practice of changing a consumer's telephone service—be it local or long distance—without the customer's permission.

The Federal Communication Commission revised slamming liability rules on November 28, 2000 so that its Enforcement Bureau could passionately pursue violators and levy massive fines against carriers that slam unwitting consumers into their services.

Phone fixes
Consumers are empowered with legal recourse if a communications carrier has slammed them. Individuals can file a complaint with the relevant local agency—usually state public service or utility commissions—or express their dissatisfaction with the phone company by dropping a line to the FCC.

If a consumer discovers they've been slammed by an unauthorized carrier prior to paying their phone bill, they are not held responsible for paying the bill. As a matter of fact, consumers don't have to pay any carrier for up to 30 days after being slammed—neither their authorized phone service nor the slamming company. After a month, consumers have to pay their authorized phone company, but at its rates, not the slammer's fees.

If a consumer discovers they've been slammed after paying their phone bill, the slamming company must pay the consumer's authorized phone firm 150 percent of the charges billed to the consumer. From this amount, the consumer's authorized phone service must then reimburse individuals 50 percent of the charges paid to the slamming service.

With its slamming rules and penalties in place, the Commission figures that it has taken the profit out of slamming and protected consumers from illegal charges, as well as protect common carriers' investments made in acquiring new customers—legally.

DSL dilemmas
But what happens when digital subscriber line users have their service provider changed without their consent? What recourse do DSL users have when a service provider goes out of business?

More and more DSL users are facing these questions as financially-strapped providers arrange to transfer high-speed service connections to other firms. Gary R. Morrison, EdD is one of about 1,500 subscribers nationwide that is concerned about his rights as a DSL user.

Morrison, a doctor of education, needs a high-speed connection to complete research on the Net. He uses MediaNet, a medium-sized ISP located in Howell, MI—smack-dab between Lancing and Detroit—for his DSL connection. MediaNet is one of the ISPs impacted by StarNet's decision to abruptly terminate DSL operations in December.

MediaNet resold StarNet DSL service, which resold Covad DSL access. When StarNet terminated its DSL reseller's contract, Covad launched its so-called "Safety Net" program designed to take care of resellers cut off from their connections.

Covad figured that if an ISP partner failed, it could quickly pick up the slack—and a few new subscribers—keeping everyone happy and connected. Covad's Safety Net program should have rescued users like Morrison—only it didn't quite work that way, due to a few bugs in the programming.

MediaNet secured a new reseller contract for DSL from CAIS Internet. Jay Gibbon, MediaNet owner, said that when compared to Covad's program, CAIS' reseller deal was a little friendlier toward smaller ISPs and that Morrison's unfiltered DSL connection could be taken care of through CAIS.

But Covad's Safety Net program delivers DSL and IP services. Suluh Lukoskie, Covad spokesperson, said the program was not configured to split the two functions, so it needed to complete a few programming updates before it could fully transition DSL connections from MediaNet to CAIS Internet.

"We have to write and implement a software program to handle the CAIS transition," Lukoskie said. "After we found out MediaNet was going with CAIS, we had to find a way to transition the lines because we discovered we could not simply transfer back the circuits."

Go to page 2: Covad unconscious?