This bill has been amended

Bill S6850-2013

Relates to the installation of a technological solution on an advanced mobile communication device

Relates to a smart phone antitheft protection; establishes requirements for the acquisition and resale of wireless communications devices.

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  • Mar 19, 2014: REFERRED TO CONSUMER PROTECTION

Memo

BILL NUMBER:S6850

TITLE OF BILL: An act to amend the general business law, in relation to the installation of a technological solution on an advanced mobile communication device

PURPOSE OF THE BILL: This bill would require that any advanced mobile communications device, as defined, that is sold in New York, include a technological solution, which may consist of software, hardware, or both software and hardware, that can render inoperable the essential features of the device, as defined, when the device is not in the possession of the rightful owner.

SUMMARY OF PROVISIONS:

Section 1: The bill requires all smartphones and other advanced mobile communications devices offered for sale in New York to come with a technological solution enabled, in order to deter theft and protect consumers. The bill includes a clause to prohibit any term or condition in a service contract between a customer and a commercial mobile radio service provider that requires or encourages the customer to disable the technological solution that renders the customer's smartphone or other advanced communications device useless if stolen.

Section 2: Establishes that section 399-zzzz be added to the general business law, which states any advanced mobile communications device that is sold on or after January 1, 2015 will include a technological solution that can render the essential features of the device inoperable when the device is not in the possession of the rightful owner. The section also permits rightful owners of advanced mobile communications devices to choose to disable the technological solution after sale. Any violators of this section will be subject to a civil penalty of not less than $500 and no more than $2500.

Section 3: Establishes the effective date.

JUSTIFICATION: According to the Federal Communications Commission, one in three robberies in the United States involves the theft of a mobile communications device, making it the number one property crime in the country. Many of these robberies often turn violent with some resulting in the loss of life. The FCC estimates that between thirty to forty percent of United States street-theft involves a mobile device. In fact, more than forty percent of all robberies in New York City involve smartphones and other cell phones. Replacement of lost or stolen mobile communications devices was an estimated thirty-billion dollar business in 2012, and the four largest providers of mobile radio services made an estimated seven billion eight hundred million dollars from theft and loss insurance products in 2013. With robberies of smartphones reaching an all-time high, New York should utilize the readily available solution to the problem. The "kill switches" will combat surging smartphone theft across the state by reducing the incentive and ability criminals have to make money off the stolen devices.

In order to deter criminals from stealing phones from consumers, there needs to be a way to render stolen phones worthless. Currently the only way this is possible is to make the phones unusable, and

therefore unable to be profited from on the secondhand market. Utilizing kill switch technology ensures this is possible while maintaining the safety and integrity of the victim/consumer. In addition, there should be no inclination on the part of the consumer to turn off the kill switch and to ensure this; it has been written into the bill that no provider may attempt to entice the consumer in any way to turn it off.

PRIOR LEGISLATIVE HISTORY: Assembly Bill A8984/2014 (Titone)

FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: None.

EFFECTIVE DATE: This act shall take effect immediately.


Text

STATE OF NEW YORK ________________________________________________________________________ 6850 IN SENATE March 19, 2014 ___________
Introduced by Sen. AVELLA -- read twice and ordered printed, and when printed to be committed to the Committee on Consumer Protection AN ACT to amend the general business law, in relation to the installa- tion of a technological solution on an advanced mobile communication device THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Legislative intent. The legislature finds that: (a) According to the federal communications commission (FCC), one in three robberies in the United States involves the theft of a mobile communications device, making it the number one property crime in the country. Many of these robberies often turn violent with some resulting in the loss of life. (b) The FCC estimates that between thirty to forty percent of United States street theft involves a mobile device. In fact, more than forty percent of all robberies in New York city involve smartphones and other cell phones. (c) Consumer reports projects that one point six million Americans had their smartphones stolen in 2012. (d) According to the New York Times, one hundred thirteen smartphones are lost or stolen every minute in the United States. (e) Major cities are home to the highest concentrations of cell phone theft, and officials in New York and California have been pushing for a cellphone kill switch in those states since April 2012. According to New York state attorney general Eric Schneiderman, the United States senate proposal would force the mobile industry to "stop dragging its feet and join us in protecting consumers." (f) In April of 2012, U.S. senator Charles Schumer, D-New York, and New York city police commissioner Ray Kelly announced that the major U.S. cell phone carriers and the federal communications commission have agreed to set up a national database to track reported stolen phones. Senator Schumer also introduced a bill called the mobile device theft deterrence act, which proposes a five-year prison sentence for tampering with the ID numbers of a stolen cell phone.
(g) According to press reports, the international trafficking of stolen smartphones by organized criminal organizations has grown expo- nentially in recent years because of how profitable the trade has become. (h) Replacement of lost and stolen mobile communications devices was an estimated thirty-billion-dollar business in 2012 according to studies conducted by mobile communications security experts. Additionally, industry publications indicate that the four largest providers of commercial mobile radio services made an estimated seven billion eight hundred million dollars from theft and loss insurance products in 2013. (i) Technological solutions that render stolen mobile communications devices useless already exist, but the industry has been slow to adopt them. (j) In order to be effective, these technological solutions need to be ubiquitous, as thieves cannot distinguish between those mobile communi- cations devices that have the solutions enabled and those that do not. As a result, the technological solution should be able to withstand a hard reset or operating system downgrade, and be enabled by default, with consumers being given the option to affirmatively elect to disable this protection. (k) Manufacturers of advanced mobile communications devices and commercial mobile radio service providers have a responsibility to ensure their customers are not targeted as a result of purchasing their products and services. (l) It is the intent of the legislature to require all smartphones and other advanced mobile communications devices offered for sale in New York to come with a technological solution enabled, in order to deter theft and protect consumers. (m) It is the further intent of the legislature to prohibit any term or condition in a service contract between a customer and a commercial mobile radio service provider that requires or encourages the customer to disable the technological solution that renders the customer's smart- phone or other advanced communications device useless if stolen. S 2. The general business law is amended by adding a new section 399- zzzz to read as follows: S 399-ZZZZ. ADVANCED MOBILE COMMUNICATIONS DEVICES. 1. DEFINITIONS. FOR PURPOSES OF THIS SECTION, THE FOLLOWING TERMS HAVE THE FOLLOWING MEANINGS: (A) "ADVANCED MOBILE COMMUNICATIONS DEVICE" MEANS AN ELECTRONIC DEVICE THAT IS REGULARLY HAND HELD WHEN OPERATED THAT ENABLES THE USER TO ENGAGE IN VOICE COMMUNICATIONS USING MOBILE TELEPHONY SERVICE, VOICE OVER INTERNET PROTOCOL, OR INTERNET PROTOCOL ENABLED SERVICE, AND TO CONNECT TO THE INTERNET, AND INCLUDES WHAT ARE COMMONLY KNOWN AS SMART- PHONES AND TABLETS. (B) "COMMERCIAL MOBILE RADIO SERVICE" MEANS "COMMERCIAL MOBILE SERVICE," AS DEFINED IN SUBSECTION (D) OF SECTION 332 OF TITLE 47 OF THE UNITED STATES CODE AND AS FURTHER SPECIFIED BY THE FEDERAL COMMUNI- CATIONS COMMISSION IN PARTS 20, 22, 24, AND 25 OF TITLE 47 OF THE CODE OF FEDERAL REGULATIONS, AND INCLUDES "MOBILE TELEPHONY SERVICE." (C) "ESSENTIAL FEATURES" OF AN ADVANCED MOBILE COMMUNICATIONS DEVICE INCLUDE THE ABILITY TO USE THE DEVICE FOR VOICE COMMUNICATIONS AND THE ABILITY TO CONNECT TO THE INTERNET, INCLUDING THE ABILITY TO ACCESS AND USE MOBILE SOFTWARE APPLICATIONS COMMONLY KNOWN AS "APPS." (D) "HARD RESET" MEANS THE RESTORATION OF AN ADVANCED MOBILE COMMUNI- CATIONS DEVICE TO THE STATE IT WAS IN WHEN IT LEFT THE FACTORY, AND
REFERS TO ANY ACT OF RETURNING A DEVICE TO THAT STATE, INCLUDING PROC- ESSES COMMONLY TERMED A FACTORY RESET OR MASTER RESET. (E) "INTERNET PROTOCOL ENABLED SERVICE" OR "IP ENABLED SERVICE" MEANS ANY SERVICE, CAPABILITY, FUNCTIONALITY, OR APPLICATION USING EXISTING INTERNET PROTOCOL, OR ANY SUCCESSOR INTERNET PROTOCOL, THAT ENABLES AN END USER TO SEND OR RECEIVE A COMMUNICATION IN EXISTING INTERNET PROTO- COL FORMAT, OR ANY SUCCESSOR INTERNET PROTOCOL FORMAT THROUGH A BROAD- BAND CONNECTION, REGARDLESS OF WHETHER THE COMMUNICATION IS VOICE, DATA, OR VIDEO. (F) "MOBILE TELEPHONY SERVICE" MEANS COMMERCIALLY AVAILABLE INTERCON- NECTED MOBILE PHONE SERVICES THAT PROVIDE ACCESS TO THE PUBLIC SWITCHED TELEPHONE NETWORK (PSTN) VIA MOBILE COMMUNICATION DEVICES EMPLOYING RADIO WAVE TECHNOLOGY TO TRANSMIT CALLS, INCLUDING CELLULAR RADIOTELE- PHONE, BROADBAND PERSONAL COMMUNICATIONS SERVICES (PCS), AND DIGITAL SPECIALIZED MOBILE RADIO (SMR). "MOBILE TELEPHONY SERVICES" DOES NOT INCLUDE MOBILE SATELLITE TELEPHONE SERVICES OR MOBILE DATA SERVICES USED EXCLUSIVELY FOR THE DELIVERY OF NON-VOICE INFORMATION TO A MOBILE DEVICE. (G) "SOLD IN NEW YORK" MEANS THAT THE ADVANCED MOBILE COMMUNICATIONS DEVICE IS SOLD AT RETAIL, AND NOT FOR RESALE, FROM A LOCATION WITHIN THE STATE, OR THE ADVANCED MOBILE COMMUNICATIONS DEVICE IS SOLD AND SHIPPED TO AN END-USE CONSUMER AT AN ADDRESS WITHIN THE STATE. (H) "VOICE OVER INTERNET PROTOCOL" OR "VOIP" MEANS VOICE COMMUNI- CATIONS SERVICE THAT DOES ALL OF THE FOLLOWING: (I) USES INTERNET PROTOCOL OR A SUCCESSOR PROTOCOL TO ENABLE REAL-TIME, TWO-WAY VOICE COMMUNICATION THAT ORIGINATES FROM, OR TERMI- NATES AT, THE USER'S LOCATION IN INTERNET PROTOCOL OR A SUCCESSOR PROTO- COL. (II) REQUIRES A BROADBAND CONNECTION FROM THE USER'S LOCATION. (III) PERMITS A USER GENERALLY TO RECEIVE A CALL THAT ORIGINATES ON THE PUBLIC SWITCHED TELEPHONE NETWORK AND TO TERMINATE A CALL TO THE PUBLIC SWITCHED TELEPHONE NETWORK. (IV) A SERVICE THAT USES ORDINARY CUSTOMER PREMISES EQUIPMENT WITH NO ENHANCED FUNCTIONALLY THAT ORIGINATES AND TERMINATES ON THE PUBLIC SWITCHED TELEPHONE NETWORK, UNDERGOES NO NET PROTOCOL CONVERSION, AND PROVIDES NO ENHANCED FUNCTIONALITY TO END USERS DUE TO THE PROVIDER'S USE OF INTERNET PROTOCOL TECHNOLOGY IS NOT A VOIP SERVICE. 2. TECHNOLOGICAL SOLUTION. (A) ANY ADVANCED MOBILE COMMUNICATIONS DEVICE THAT IS SOLD IN NEW YORK ON OR AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN, SHALL INCLUDE A TECHNOLOGICAL SOLUTION THAT CAN RENDER THE ESSENTIAL FEATURES OF THE DEVICE INOPERABLE WHEN THE DEVICE IS NOT IN THE POSSESSION OF THE RIGHTFUL OWNER. A TECHNOLOGICAL SOLUTION MAY CONSIST OF SOFTWARE, HARDWARE, OR A COMBINATION OF BOTH SOFTWARE AND HARDWARE, BUT SHALL BE ABLE TO WITHSTAND A HARD RESET. NO ADVANCED MOBILE COMMUNICATIONS DEVICE MAY BE SOLD IN NEW YORK WITHOUT THE TECHNO- LOGICAL SOLUTION ENABLED. (B) THE RIGHTFUL OWNER OF AN ADVANCED MOBILE COMMUNICATIONS DEVICE MAY AFFIRMATIVELY ELECT TO DISABLE THE TECHNOLOGICAL SOLUTION AFTER SALE. HOWEVER, THE PHYSICAL ACTS NECESSARY TO DISABLE THE TECHNOLOGICAL SOLUTION MAY ONLY BE PERFORMED BY THE END-USE CONSUMER OR A PERSON SPECIFICALLY SELECTED BY THE END-USE CONSUMER TO DISABLE THE TECHNOLOG- ICAL SOLUTION AND SHALL NOT BE PHYSICALLY PERFORMED BY ANY RETAIL SELLER OF THE ADVANCED MOBILE COMMUNICATIONS DEVICE. (C) A PROVIDER OF COMMERCIAL MOBILE RADIO SERVICE SHALL NOT INCLUDE A TERM OR CONDITION IN A SERVICE CONTRACT WITH AN END-USE CONSUMER WITH AN ADDRESS WITHIN THE STATE THAT REQUIRES OR ENCOURAGES THE CONSUMER OR
RIGHTFUL OWNER TO DISABLE THE TECHNOLOGICAL SOLUTION THAT RENDERS THE CONSUMER'S SMARTPHONE OR OTHER ADVANCED COMMUNICATIONS DEVICE USELESS IF STOLEN. 3. PENALTIES. (A) A PERSON OR RETAIL ENTITY SELLING AN ADVANCED COMMU- NICATIONS DEVICE IN NEW YORK IN VIOLATION OF SUBDIVISION TWO SHALL BE SUBJECT TO A CIVIL PENALTY OF NOT LESS THAN FIVE HUNDRED DOLLARS, NOR MORE THAN TWO THOUSAND FIVE HUNDRED DOLLARS, PER DEVICE SOLD IN NEW YORK. (B) A PROVIDER OF COMMERCIAL MOBILE RADIO SERVICE THAT INCLUDES A TERM OR CONDITION IN A SERVICE CONTRACT WITH AN END-USE CONSUMER WITH AN ADDRESS WITHIN THE STATE IN VIOLATION OF PARAGRAPH (C) OF SUBDIVISION TWO OF THIS SECTION, SHALL BE SUBJECT TO A CIVIL PENALTY OF NOT LESS THAN FIVE HUNDRED DOLLARS, NOR MORE THAN TWO THOUSAND FIVE HUNDRED DOLLARS, PER SERVICE CONTRACT WITH AN END-USE CONSUMER WITH AN ADDRESS WITHIN NEW YORK. S 3. This act shall take effect immediately.

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