BILL ANALYSIS
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THIRD READING
Bill No: AB 1814
Author: Reyes (D)
Amended: 8/6/02 in Senate
Vote: 21
SENATE ENERGY, U.&C. COMMITTEE : 6-2, 6/25/02
AYES: Bowen, Alarcon, Dunn, Murray, Sher, Vasconcellos
NOES: Morrow, Battin
ASSEMBLY FLOOR : 49-28, 4/4/02 - See last page for vote
SUBJECT : Internet service providers: notice of service
termination
SOURCE : Author
DIGEST : This bill requires 30-day notice by an Internet
service provider (ISP) to a customer of service termination
or service transfer to another ISP.
ANALYSIS : Current law requires long-distance telephone
companies to provide 30 days notice to customers before
going out of the long-distance business or discontinuing
service for an entire class of customers.
Current law provides no specific penalty for long distance
telephone companies that violate the above notice
requirement. However, penalties may be applied under the
state's Unfair Practices Act (Business and Professions Code
Section 17000 et seq.), which allows civil penalties of up
to $2,500 to be recovered in a civil action by the attorney
CONTINUED
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general or a district attorney.
Current law requires electric, gas, heat, and water
utilities to provide at least 15 days notice before cutting
off service due to the customer's failure to pay a
delinquent account balance. Public utilities that violate
this requirement are subject to a misdemeanor punishable by
a fine up to $1,000 or imprisonment up to one year, or
both.
Current law requires cable and satellite companies to
provide at least 15 days notice before cutting off service
due to a customer's failure to pay a delinquent account
balance.
Current law gives city and county governments the ability
to set penalties for cable and satellite companies that
violate the above notice requirement, but limits those
penalties to no more than $200 per day, not to exceed a
total of $600 per occurrence.
Current law does not place any such requirements on
providers of electronic mail services.
This bill requires Internet service providers to notify
customers 30 days in advance of proposed transfer of
service to another Internet service provider or of proposed
termination of service, unless otherwise permitted by law
or contract.
This bill requires the advance notice to include: a
description of any proposed transfer of services; any
applicable rates, terms and conditions of the new service;
a statement that the customer has the right to transfer to
a service provider of his or her choice; and a toll-free
customer service telephone number customer.
This bill prohibits an Internet service provider from
charging the customer for transferring a customer to a new
service in a case where the provider is exiting the
business.
This bill provides that it preempts local government and
local agency rules regarding notice of email service
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termination.
This bill prohibits a contract from permitting termination
of service with cause without less than 30 day's notice.
The bill would become inoperative if federal law is enacted
on this subject.
Background
Consumers and businesses have come to rely on email
services to conduct business, much as they rely on
telephone and other utility services. Many companies allow
customers to order products and services through email;
students enrolled in distance education programs rely on
receiving and submitting assignments electronically;
employees communicate with co-workers at offsite locations
via email; patients access their medical records via the
Internet; and many people use email to take care of
everyday business they used to handle by mailing letters
and making phone calls.
On December 1, 2001, more than 850,000 subscribers of
Excite@Home email services provided via AT&T Broadband were
cut off from service without notice and left without
Internet access for several days before being moved to a
new network. The service shut down came on the heels of
Excite@Home's September 2001 bankruptcy filing and its
failure to reach a financial agreement with AT&T, which
would have allowed for a smooth transition period for
customers to be moved to a new provider. Excite@Home was
able to reach agreements with other cable companies, such
as Comcast and Cox Communications, whose customers
experienced no interruptions in service.
Tens of thousands of customers whose services were abruptly
shut down were California residents and businesses, who
experienced problems getting customer service and technical
assistance, restoring Internet and email services on the
new network, and retrieving lost email messages and website
data.
Many believe email service has become as essential to
conducting business as telephone and other utility services
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for many individuals and companies. This bill extends
protections to email users similar to the protections
enjoyed by customers of telephone, electricity, gas, water,
cable, and satellite providers who can't shut down services
without providing adequate notice to their customers.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 8/5/02)
California Public Interest Research Group
California School Employees Association
Greenlining Institute
OPPOSITION : (Verified 8/5/02) (prior to latest
amendments)
American Electronics Association
California Alliance for Consumer Protection
ASSEMBLY FLOOR :
AYES: Alquist, Aroner, Calderon, Canciamilla, Cardenas,
Cardoza, Chan, Chavez, Chu, Cohn, Corbett, Correa, Diaz,
Dutra, Firebaugh, Florez, Frommer, Goldberg, Havice,
Horton, Jackson, Keeley, Kehoe, Koretz, Liu, Longville,
Lowenthal, Maldonado, Matthews, Migden, Nakano, Nation,
Negrete McLeod, Oropeza, Papan, Pavley, Reyes, Salinas,
Shelley, Simitian, Steinberg, Strom-Martin, Thomson,
Vargas, Washington, Wayne, Wiggins, Wright, Wesson
NOES: Aanestad, Ashburn, Bates, Bogh, Briggs, Bill
Campbell, John Campbell, Cogdill, Cox, Daucher,
Dickerson, Harman, Hollingsworth, Kelley, La Suer, Leach,
Leonard, Leslie, Maddox, Robert Pacheco, Rod Pacheco,
Pescetti, Richman, Runner, Strickland, Wyland, Wyman,
Zettel
NC:sl 8/7/02 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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