While telemarketing groups welcomed the Federal Trade Commission's decision late Friday to postpone until Oct. 1 implementation of some parts of its changes to the Telemarketing Sales Rule, some telemarketing firms wondered if they could meet even these extended deadlines.
The FTC granted a Direct Marketing Association petition and extended the implementation date for the abandoned-call provision of the revised Telemarketing Sales Rule (TSR). But, the FTC denied the petition by the DMA and the American Teleservices Association to stay other provisions of the TSR.
Other provisions include:
*Implementing a national do-not-call list
*Requiring telemarketers to transmit Caller ID information
*Restricting unauthorized billing
The granted petition extends until Oct. 1, enforcement of the provisions that say telemarketers must use a recorded message as part of a "safe harbor" if the telemarketer abandons a call after the person who has been called answers the phone. This provision was to have gone into effect on March 31.
"It certainly buys us time, I don’t know if it's enough time," said Nancy Korzeniewski, manager of inbound operations at telemarketing firm InfoCision, Akron OH. "Maybe by doing this, the FTC is beginning to acknowledge how important telemarketing is to the economy."
In the meantime, the firm is beta-testing equipment in its call centers to help make sure it is in compliance by October.
But testing and installing such equipment is expensive: InfoCision is paying $14,000 per seat and the company has 1,171 seats in all its call centers for a total of nearly $16.5 million. Korzeniewski noted that many smaller call center firms won't be able to afford this.
"This is either going to drive companies offshore where they don't have to comply with the FTC rules or put them out of business," she said.
She explained that many U.S.-based companies that use telemarketing might be tempted to use call center firms based in foreign countries because it’s not clear legally at this moment how much they would abide by the new FTC regulations.
"This is a big fear among U.S. telemarketing companies," she said.
Similarly Jon E., Kaplan, president of consulting firm Teledevelopment Services, Cleveland, doubted that all telemarketing firms could meet this deadline.
"You may get 30% to 40% compliance by then, but I don't think it's possible to get full compliance," he said. "The question is when will the FTC start enforcing these rules?"
But industry groups welcomed the delay.
"The investment in new and upgraded equipment was not possible in the timeframe given," said the American Teleservices Association, in a statement. "Our members will now be able to plan more efficiently and effectively."
The DMA is continuing to pursue legal remedies to throw out or at least modify other parts of the revised FTC Telemarketing Sales Rule.
Those include its challenge to the FTC over contradictions with existing Federal Communications Commission rules on companies’ previous relationship with consumers. And, they include an overall challenge on the grounds of violations of commercial free speech, said DMA vice president of government affairs Jim Conway.
In its lawsuit filed Jan 29 in U.S. District Court in Oklahoma City, the DMA argued that the FTC's proposed government-run do-not-call registry would violate First Amendment rights to advertise freely. The DMA asserts that in creating such a list, the FTC exceeded its statutory authority. In addition, The DMA points out that the Federal Communications Commission is considering a similar proposal, opening the door to potential bureaucratic duplication.
The FCC is reportedly expected to make its recommendations in a few months.
