Telemarketing: FCC extends do-not-call list

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Banks, insurance providers, phone companies, airlines and newspaper publishers learned-to their dismay-that they will not be exempt from the Federal Trade Commission's do-not-call list.

The Federal Communications Commission voted last week to extend the FTC list to all commercial marketers, including those in industries not overseen by the trade commission.

While the affected industries predicted dire consequences for the $700 billion telemarketing business, consumer groups praised the move. "These solicitations are a nuisance to millions of Americans who want more privacy in their homes," AARP CEO Bill Novelli said in a statement.

60 million in first year

The FTC said that as many as 60 million people are expected to register for the list within a year. By the end of the first day of registration on June 27, 735,000 people had signed up. The Direct Marketing Association predicted that could reduce telemarketing sales by as much as 50%. Marketers that call people on the list with whom they don't have a "pre-existing business relationship" face fines of $11,000 per violation.

President Bush on June 27 joined FTC Chairman Tim Muris and FCC Chairman Michael Powell in a White House rose garden ceremony marking the launch of the list, which consumers will be able to register for via phone or the Internet.

The original FTC list, due to take effect Oct. 1, affected companies where the FTC oversees marketing. That left coverage gaps that included banks, insurance companies, phone companies and airlines.

Last week's FCC action expands coverage to all but charitable or political solicitations. The FCC said all phone sellers have to buy and use the FTC list. In a surprise, the FCC also made the list applicable to in-state calls as well as out-of-state ones.

That will affect the newspaper industry. Currently, 12 state do-not-call lists exempt newspapers, but the FCC action means all newspapers will have to use the federal list.

"All newspapers must scrub their call lists with the national do-not-call registry despite state regulations that exempted newspapers because of the important role they play in providing news and information to local communities," said John F. Sturm, president-CEO of the Newspaper Association of America, in a statement.

`key tool'

"Telemarketing is a key tool that has been used responsibly by newspapers for more than 60 years," he added, warning that the decision would hurt newspapers' ability to target new readers.

Direct Marketing Association President-CEO H. Robert Wientzen said the $7,000 annual cost of the list would be expensive for marketers, but that they are more concerned about lost sales.

"We continue to think this is not a proper role by government," he said.

In separate lawsuits against the FTC, both the DMA and American Teleservices Association contend that the do-not-call list is unconstitutional. Tim Searcy, executive director of the ATA, said the FCC could be added to its suit.

The FTC late last week provided new details on how "pre-existing business relationships" would be defined, while the FCC's new rule strengthened its ban on unsolicited faxes. Under the business relationship, someone on the national do-not-call list who contacts a company could legally be called for three months and someone with an existing relationship could be contacted for up to 18 months after a purchase, payment or delivery. The FCC said even with an existing business relationship, unsolicited faxes could only be sent if a consumer "opted in" to receive faxes.

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