July 29, 1997 6:45 PM PDT

AOL dumps new member policy

America Online (AOL) has tossed its "TOS," as its terms of service are known, in the wake of last week's controversy about one of the contract's provisions.

AOL's TOS contain all the legal jargon to which members agree when signing onto the service. They outline everything from acceptable online behavior to the company's marketing policies. The current TOS remain in effect while AOL develops a new policy.

While most Internet access firms have similar service rules, few have become as controversial as America Online's.

Without notice to its customers, AOL posted revised TOS on July 1. The rules were slated to go into effect July 31. Less than ten days before then, an AOL member alerted the press to the fact that the rules included a new provision to provide members' telephone numbers to its business partners, one of which is a marketing firm.

When CNET's NEWS.COM and then other media outlets wrote about the new policy, outraged members flooded the online service with letters and flocked to a relatively low-traffic area on AOL to have their names removed from marketing lists.

Once again, AOL had a public relations disaster on its hands, and on Friday, CEO Steve Case announced he would rescind the controversial part from the terms.

But that still left the online giant open to criticism--especially from privacy experts who had taken it upon themselves to go over the TOS with a fine-tooth comb. They found lots to critique, mostly points on member privacy. This is a particularly sensitive point for AOL executives, who like to say that they value privacy, especially when they talk to members of Congress.

So late Friday, executives decided to take down all the revisions to the terms of service almost as quietly as they had been posted.

"All the revisions came down," said AOL spokeswoman Tricia Primrose. "They're going to be reviewed and clarified. You can be sure there will be plenty of online communication when they go up."

Primrose said the TOS "were posted prematurely, and in some cases, written far too broadly and did not reflect all the policies of the company."

In other words, AOL had made a mistake.

But last week's incident was not the first time the world's largest online service got caught trying to give away personal information without informing its customers.

Nearly three years ago, when the Internet was a much smaller place and stories about online companies didn't get as much publicity, AOL came under fire for virtually the same issue: "America Online, the nation's fastest-growing online service, is selling detailed personal information about its 1 million subscribers to direct marketers--without asking subscribers' permission or telling them about it," read a newspaper story from the Washington Times written in early October 1994.

The story went on to quote a Electronic Privacy Information Center representative and a Congressman calling AOL on the carpet for violating the privacy of its members.

But ultimately, the controversy had a diminished effect then, and the recent debacle appears to have little effect now.

Aside from some members removing their names from potentially lucrative marketing lists--Primrose did not have figures--the service appears to have emerged unscathed.

Ironically, AOL still retains the right to do at least one of the things that members had objected to in the first place: calling them on the phone to sell them products. AOL's partners, such as CUC International, won't be making the calls themselves. But the online service reserves the right to make the calls on behalf of CUC and other partners.

However, one critic said that while AOL appears not to have been affected by the controversy, members are now more sensitive to these issues. They'll probably be watching the company carefully and ready to excise skeletons in its online closets.

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AOL's TOS
I'm very violated about AOL's TOS system. It is an infringment on every AOL members privacy and right to freedom of speech. AOL is nothing more than a bully and just wants to gain more money by violating our rights. AOL can not govern over the rights of others, as the Constitution dictates by law that no one shall be governed by authority unless by the authority in a court of law. AOL has over stepped it's bounds and the TOS must disappear completely.
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