US operators profit from surveillance

As featured on TM Forum's the Insider blog

Just over a year ago I reported on a little known revenue stream in CSPs that proved crime does pay. It had come to light that mobile network operators (MNOs) in the US were charging police departments substantial sums for wiretaps and other requests for their users' personal mobile phone data, with the fees differing widely - from $325 (€247) per wiretap target per month to as much as $700.
 
The American Civil Liberties Union had just released a report based on more than 5,000 pages of internal records from 205 police departments in the US, which it obtained through a Freedom of Information request, detailing the prices mobile phone companies charge law enforcement agencies for mobile phone tracking data.
 
According to an article in Forbes magazine the Tucson, Arizona police department provided a list outlining the specific costs for the various types of ‘data requests.’ All the US MNOs reportedly had even created manuals for police outlining how they could access the data they store.
 
It was also reported that each MNO dictated its own charges, which varied greatly. T-Mobile charged a flat fee of $500 per wiretap while Sprint Nextel wants $400 per ‘market area’ and per ‘technology’ as well as a $10 fee per day, capped at $2,000. The going rate at AT&T was just $325, plus $10 per day for voice and $5 for data. Meanwhile, Verizon charged $700 per month and a $50 admin fee.
 
They also had fees for everything else. Voicemail or text messages would set the police or FBI back $30-$60 and pictures and video cost as much as $120 at Sprint. For location data, the mobile operators were particularly helpful to local authorities, offering them automated tools that let them track suspects in real time. These fees ranged from $30 a month (Sprint) to $100 per day (T-Mobile). AT&T charges $25 a day as well as a $100 activation fee.
 
In view of the latest revelations about the activities of the NSA and PRISM, one can only wonder how much revenue their extended activities are reaping for operators, presuming they are charging for them. In an Associated Press report, Facebook said it didn't charge the government for access. And while Microsoft, Yahoo and Google won't say how much they charge, the American Civil Liberties Union found that email records could be turned over for as little as $25.
 
Industry says it doesn't profit from the hundreds of thousands of government eavesdropping requests it receives each year, but civil liberties groups want businesses to charge, presumably to discourage these activities, or at least limit them. It is worried that government surveillance will become too cheap as companies automate their responses. And if companies gave away customer records for free, wouldn't that encourage even more gratuitous surveillance?
 
The same report stated that, “as the number of law enforcement requests for data grew and CSPs upgraded their technology, the cost of accommodating government surveillance requests increased. AT&T said it devotes roughly 100 employees to review each request and hand over data. Likewise, Verizon said its team of 70 employees works around the clock, seven days a week to handle the quarter-million requests it gets each year.”
 
There is no way they could afford to support these activities and not be able to charge for them, surely? Judging from the extraordinary budgets law enforcement agencies have they should have no problem paying for them as well.
 
But this raises the question of who could be prosecuted or sued in future for giving up or using private information. CSPs are between a rock and a hard place when it comes to refusing these requests but if they profit from them it will only be a matter of time before someone in that litigation-crazy environment goes for them. Will they be protected by the same agencies they are working with?
 
In one case still pending from 2009, a New York criminal prosecutor sued several major operators in the US for overcharging federal and state police agencies when supplying information. Appears to be a no-win situation whichever way you look at it.
 

Tony Poulos is a market strategist at the TM Forum

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