March 2003

Sanchez: Despite the new restrictions, it is unlikely that Telvista will experience anything more than a minimal impact. Presently, 95 percent of our contact center operations are structured around inbound business. Of the remaining 5 percent of our operations that are dedicated to outbound operations, most of these calls are directed toward existing customers and market research.

Johnson: The recent FTC Telemarketing Sales Rules will place additional stress on the entire telemarketing industry. There will be the need to upgrade and enhance current systems in order to comply. There is also a high likelihood the ruling will make telemarketing a more expensive acquisition channel for the many companies that either outsource or do internal outbound telemarketing. It will also impact companies' decisions to use outbound telemarketing for customer acquisition, in turn negatively impacting the employment of individuals in this industry.

CIS: What changes will you have to make to comply with the new regulations?

Johnson: Several changes will have to be made within our technology and operations departments. We have begun working closely with our clients and the manufacturer of our dialers to ensure a thorough understanding and compliance with the new regulations. Our technology will need additional programming and an enormous amount of additional storage space to gather, report and retain the necessary data. Additional resources are currently being identified and brought on staff to provide the real-time monitoring and reporting required. In addition, we have focused our operations staff on creating and implementing training and management processes in order to enhance our agent focus, selling skills and the optimization of each contact. 

Sanchez: From an infrastructure standpoint, Telvista will need to make few, if any, changes to remain in compliance. However, regarding process, we will need to ensure that our "Do Not Call" lists are updated and that our outbound operations comply with the new regulations.

CIS: What do you think will be the impact on U.S. businesses?

Sanchez: I believe this new legislation will have a substantial impact on the way businesses market their products, particularly those that strongly embrace the concept of telemarketing. It will also dramatically impact the way consumers learn about and buy those products.

Johnson: I think these changes will make telemarketing a less competitive channel for companies to acquire customers. The national do not call list will take away consumer choice, as those who sign up for the listing will not have the ability to take advantage of the competitive and attractive offers that are most often presented to them via telemarketing.

CIS: What can the industry do to counter these regulations?

Johnson: The industry is currently taking several initiatives to ensure that the parties involved in the creation of the rules are aware of their impact on business and their employees. In addition, the American Teleservices Association is currently working through initiatives with the courts and the FTC, as they do not feel the rulings are in the best interest of the companies who are in the telemarketing industry.

Sanchez: Barring complete or partial reversal of the regulations, I think the most effective way to counter them is for the telemarketing community to educate the public and lawmakers on the benefits of our industry. Unfortunately, while many people do not mind receiving telemarketing calls, those who do are much more visible and willing to speak out. And in today's fragmented society, the groups who are most organized typically win out in the end.

Another way to counter the new regulations is for the telemarketing industry as a whole to effectively communicate the risks of the restrictions. For example, if companies are unable to telemarket effectively, it may make efforts to sell their products that much more difficult. Telemarketing is an extremely cost-effective way for companies to promote their products and target specific consumer segments. As a result of legislation, there may also be products and services that customers can no longer get or afford because the cost of marketing them by other media is too high.

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