State Officials Raise Concerns With Phone Number 'Secondary Market'

The state utility regulator association’s Telecom Committee on Monday cleared a resolution seeking a deeper dive into organizations that receive numbers from phone companies and sell them to customers (see 2411120014). If approved by the NARUC board, the numbers resolution would urge the FCC to exercise its audit authority “to determine how companies are brokering or auctioning toll-free and other numbers via their websites and to determine how these companies obtain these telephone numbers.”

Scott said he understands the “immediate visceral reaction” when people learn that NumberBarn has about 70 million numbers for sale. But it doesn’t own the numbers; rather, it's a “search engine” that discovers and remembers which numbers are unassigned and then matches them with possible buyers, he said. “We’re actually helping” with “number efficiency,” because if someone asked a carrier to find a specific number or a consecutive series of numbers, that carrier might have to ask for another thousands-block of numbers to fulfill the request.

Maine Public Utilities Commission telecom analyst Michael Johnson noted transparency concerns. Carriers, he said, are reporting numbers to the state as assigned, though showing them as available to companies like NumberBarn. Carriers are “cherry picking lots of numbers” that are desirable because, for example, in phone code they spell a popular word like cool or bike, he said. “We have no visibility into … where those numbers go” because carriers have created "an elaborate secondary market" for them. Many numbers might go overseas, said the official. “But then when we do see ‘cool’ or ‘bike’ on NumberBarn, we are seeing that number, which shouldn’t be for sale … go for thousands of dollars, even millions of dollars.”

Scott disagreed that individual numbers may not be sold. “Numbers are property,” he said. They became property when Congress established local number portability (LNP) and allowed end users to move their numbers from one carrier to another, said the NumberBarn official. One might not like the price that a number is sold, but it’s tough to draw a line on what should be the maximum amount, he argued. While providers aren’t allowed to sell thousands-blocks of numbers, there isn’t a prohibition on selling a single number, Scott said.

FCC case law that courts affirmed says numbers are public resources, not property, countered Wilkinson Barker attorney Chuck Keller, a former FCC official who was in the audience. The LNP law gives a customer the right to transfer a number between carriers but not the right to sell it, he said. “There’s no prohibition on the customer selling it, but that doesn’t mean that the law creates property rights.”

Consumer advocate Michel Singer Nelson also took issue with Scott’s claim. Nelson, who represents the National Association of State Utility Consumer Advocates in a NANC working group, said Section 2.1 of ATIS-0300119 says that geographic numbers are a public resource that the assignee doesn't own -- and they may not be sold.

Johnson said gaining more transparency into what’s happening with numbers is critical because the U.S. could run out of them as soon as 2049 and any potential expansion could cost up to $270 billion to implement. Matt Connolly, Arizona Corporation Commission public utilities manager, also raised concerns about the movement of large quantities of numbers because many robocalls come from local numbers. The state commission plans an investigation, he said. “We’ve seen a few things that alarm us.”