US telecoms giants give in to NSA

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With one notable exception - Qwest Communications - America?s biggest telecommunications companies appear to have put up little resistance when the National Security Agency requested access to phone call records in the wake of the 9/11 terrorist attacks on New York and the Pentagon.

The government has separately sought to elicit data from a host of search engine operators in connection to an ongoing debate over the merits of a law governing minors - access to pornography on the internet.

Google initially refused a government subpoena to turn over to the Justice Department a wide-ranging demand for information about how individuals use the internet. A court ruled in March that Google had to comply with a portion of that request. Other companies, including Time Warner?s AOL, Yahoo, and Microsoft, had already agreed to the demand.

Of the four phone companies the NSA asked for information about customer calls, only Denver based Qwest, the smallest of the big four US telecommunications companies, refused.

Qwest’s former chief executive, Joseph Nacchio, backed the company’s attorneys who argued that surrendering its customers’ call-detail records to the NSA was wrong - a decision all the more surprising given Qwest’s extensive contracts with the US government.

Mr Nacchio, who is now facing charges of insider trading, confirmed in a statement issued by his attorney that Qwest was approached in the fall of 2001 to permit the government access to the private telephone records of Qwest customers.

Mr Nacchio, the statement says, inquired whether a warrant or other legal process had been secured in support of the request, and decided not to comply with the demand after he learned the government had not sought such permission.

The decision was based, according to the statement, on Mr Nacchio’s belief that complying with the request would violate the privacy requirements of the 1996 Telecommunications Act.

But that fact will probably be strongly opposed by the government. An official at the Federal Communications Commission, the telecommunications regulator, on Friday declined to comment on whether the agency would investigate the matter, but said that an exception in the law governing telecoms operators allowed the companies to provide phone data as required by law.

Qwest’s current management, led by Dick Notebaert, chief executive, reportedly broke off talks with the NSA in 2004 after failing to agree on the details. The company has declined to comment on the affair.

But unlike Qwest, the three biggest US telecommunications companies ? AT&T, Verizon Communications, and BellSouth - acceded to the NSA requests and began sharing records of tens of millions of their customers’ phone calls with the security agency.

While all three have declined to comment in detail on their reasons, lawyers suggest they would have had to balance the NSA request with Federal Communications Commission rules that bar unauthorised releases of customer information ? rules that the carriers insist they did not break.

Nevertheless, their compliance with the NSA request paved the way for the a class action suit filed in January against AT&T, the biggest US telecommunications group, by the California-based Electronics Frontier Foundation.

The privacy watchdog’s suit, based in part on the claims of a retired AT&T engineer, accuses the phone giant of violating the law and the privacy of its customers by collaborating with the NSA, in its massive and illegal programme to wiretap and data-mine Americans’ communication.

The lawsuit, which is due to be heard next week, alleges that AT&T opened its key telecommunications facilities and databases to direct access by the NSA and that AT&T has given the government unfettered access to its over 300 terabyte “Daytona” database of caller information - one of the largest databases in the world.

AT&T and the government lawyers have asked the courts to dismiss the suit, arguing that even if the allegations are true, that telecommunications companies have been granted immunity from lawsuits stemming from high level administration requests. In a brief statement on Friday, AT&T said it has had a long history of vigorously protecting customer privacy.

But the company added that it also has an obligation to assist law enforcement and other government agencies responsible for protecting the public welfare, whether it be an individual or the security interests of the entire nations.

“We prize the trust our customers place in us. If and when AT&T is asked to help, we do so strictly within the law and under the most stringent conditions. Beyond that, we don’t comment on matters of national security.”

Similarly Verizon Comminications said: “We do not comment on national security matters. “

Questions about national security policies and practices should be directed to the relevant government policymakers, it continued. “Verizon acts in full compliance with the law, and we are committed to safeguarding our customers’ privacy.”

However the renewed focus and growing suspicions over the US telecoms giants could cloud the companies legislative agenda, says David Kaut, an analyst at Stifel. The big telecoms companies are involved in a series of contentious issues including the debates over so-called “net neutrality” and video franchising and reform of the current telecommunications legislation. AT&T is also seeking approval for its planned $68bn acquistion of BellSouth.

Significantly, the furore over the NSA requests could also highlight the disparity between the regulation of the telecommunications companies and their cable TV broadband telephony rivals whose activities are regulated by the 1984 Cable Act.

Despite the growing convergence of the two industries, US cable companies that offer broadband telephony are understood not to have been approached by the NSA perhaps because their share of the telephony market which, while growing quickly, remains relatively small.

Like internet service providers that have resisted other attempts by the US government and others to obtain customer information, the cable companies have generally adopted a robust attitude towards information requests.

“It is Comcast’s policy and practice to require valid, appropriate legal process such as a subpoena, court order, or search warrant, in response to all requests for customer information,” said the largest US cable group on Friday. “It is not company policy to provide the federal government access to customer records or the ability to monitor customer communications in the absence of valid legal process.”

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