The Federal Trade Commission’s proposed refinements to the Can-Spam Act of 2003 may not be burdensome to those small businesses that outsource their e-mail marketing to service providers. But they could prove difficult for solo-flying enterprises that have opted to handle their own mail campaigns.
In mid-May the FTC released a “notice of proposed rule-making” that tweaks elements of the Can-Spam law, which went into effect Jan. 1, 2004. Among the most notable of these changes:
* E-mail senders will have three days, rather than the current 10, to comply with an addressee’s unsubscribe request.
* The term “sender” in the Can-Spam Act will be more clearly defined. As originally drawn up, the law could consider a sender to be the entity that physically transmits the e-mail, which could include an e-mail service provider. The current law has also been deemed unclear in cases where e-mail messages contain ads from more than one merchant, such as a newsletter with multiple advertisers or a co-branded e-mail message.
* Under the proposed new rules, it is explicitly illegal to require unsubscribers to pay a fee to opt out of e-mail campaigns, to make them provide any information other than their e-mail address and opt-out preference, or to make them take any action besides replying to an e-mail or visiting a single page of a Web site.
* Postal boxes and private mailboxes meet the standard for a “valid physical address” set under the original Can-Spam rules.
In announcing the changes, the FTC also said it will take public comment on them through June 27. The Direct Marketing Association commended the FTC on its proposals but said it will seek also comment from its members and compose a joint letter expressing “broad concerns” about issues that remain in the law—including the possibility of a “safe harbor” provision to protect marketers when affiliates or other parties send out ad messages on their behalf.
Shortening the allowed window for processing opt-out requests to three days from receipt may be the most popular topic of comment, says Quinn Jalli, director of privacy and ISP solutions for Digital Impact. A number of companies use a single service provider for their marketing chores, and those providers can process opt-outs very quickly—almost instantaneously—within their own systems. But some of the very largest use multiple vendors, and getting suppression data circulated to all those points on the organizational compass may be a complex operation requiring more than three days. “I think the FTC has overlooked this reality,” he says. “It’s fair to say that these larger corporations don’t use a single vendor, and they don’t have a single communication channel, and that will slow down the opt-out process.”
Large companies may indeed be the ones most noticeably affected by the shorter opt-out window, says Tara Natanson, director of ISP relations with Constant Contact, an e-mail service provider that targets small to medium businesses. But small businesses will also face the new regulations, and they may find it hard to manage quicker unsubscribe if they are trying to manage their e-mail campaigns entirely in-house.
“Anybody who’s not outsourcing their e-mail function runs the risk of not being able to keep up with these changes,” Natanson says. “They usually don’t have a person assigned to watch full-time to ensure compliance with these laws.”
She says that the majority of her company’s new small business customers were using commercial e-mail software before signing with Constant Contact. “A large proportion of small businesses simply use Microsoft Outlook to send e-mail to their clients and customers, and they just don’t have the ability to track opt-outs, unsubscribes and bounced e-mail addresses because it all comes back to them in one mailbox.”
Why did the FTC decide to reduce the opt-out period by a week? Josh Baer is CEO of UnsubCentral, which offers a service managing suppression lists as a neutral third party between Web merchants and affiliates. “The best bet I’ve heard is that they feared some unscrupulous spammers were taking advantage of that grace period to load unsubscribes up with spam,” he says. “They felt that the old rule meant days of free spamming before you were legally in violation. Personally, I don’t believe that has been happening.”
Neither does Digital Impact’s Jalli. “If I’m a marketer and a recipient hits me with an opt-out request, do I see a lot of value in bombarding that recipient with e-mail for nine more days? Probably not.”
Jalli thinks another potential problem with the proposed regulation changes may be the requirement that a recipient not need to visit more than a single Web page to opt out online from a merchant’s e-mail list. “That could be a problem for senders who require a Web log-in,” he says. “If a recipient had to go through that log-in page to get to a second subscription management page, that could violate the proposed rule. I would expect to see some further clarification of that question.”
