Industry Balks at Paying for National DNC List

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Industry groups say that they would oppose suggestions by the Federal Trade Commission that telemarketers pay user fees to fund the estimated $3 million annual cost of maintaining the proposed national do-not-call list.

The FTC said it probably would expect telemarketers to cover the cost of the national DNC list when it unveiled its proposed 2003 budget last week. An FTC official said the list would be funded by user fees and that telemarketers would be more likely than consumers to foot the bill.

Agency officials said they would look to state DNC lists as models for the national list. Many state laws require telemarketers to pay fees to obtain copies of their DNC lists and allow free registration to consumers by mail, telephone and over the Internet.

Both the Direct Marketing Association and the American Teleservices Association say they would not support telemarketers footing the whole bill for the national DNC list, which the FTC estimated will cost $5 million for start-up. But this issue, much like the rest of the national DNC list plan, is still in flux, and the rulemaking process for the list and other proposed changes to the FTC's Telemarketing Sales Rule is expected to last at least a year.

"This is going to be a long process," said Jim Conway, vice president of government affairs for the DMA. "If this was a baseball game, this would be the top of the first."

There have been indications that the FTC is not prepared to make consumers pay for registering to the list. When the FTC first announced its plan for a national DNC list, consumer protection bureau director Howard Beales said that registration would be available to consumers via a toll-free hotline.

Also, the FTC has suggested that it may employ technology that automatically detects consumers' telephone numbers when they call the hotline, thereby making registration as simple as dialing a toll-free number. Nevertheless, the FTC is accepting written comments on its proposed changes to the TSR until the end of March, and public hearings on the issue are scheduled for June, offering some possibility that its direction can still be changed.

The DMA hopes to use the rulemaking process as a forum for improving the industry's image and alerting people to the 6 million jobs and $660 billion in sales that teleservices contributes to the economy annually, Conway said. The DMA met with its own members this week to discuss the issue and plans to meet with other industry organizations, including the ATA and Magazine Publishers Association.

"We're tired of being unpopular," Conway said. "Let's do a better job of communicating what we contribute."

The FTC has not released an estimate on how many people are expected to sign up for the national DNC list, though an agency spokeswoman said states have experienced up to 60 percent signup rates. Such high figures would represent a "huge hit" for the industry, said Kevin Brosnahan, spokesman for the ATA.

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