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May 1996

The New Telecommunications Law

A Friend Or Foe?


Through my involvement with our government's lawmakers and rulemakers, I have learned a great deal about how our system of legislation and regulation actually works. The most important lesson I have learned is that signing a bill, and thereby creating a law, is only half the story. The other half is what happens next: a government agency is designated to write detailed rules to realize the "spirit" or intent of a law. A piece of legislation, all by itself, doesn't mean very much. Rather, it is the quality of the rulemaking that makes all the difference.

As I learned during my experience with the Federal Trade Commission (which created the Telemarketing Sales Rule), it is impossible to underestimate the importance of consulting true industry experts and practitioners during the rulemaking process. It is common practice for a government agency to hold a series of hearings before finalizing a set of rules. If true industry experts have a chance to speak during these hearings, there is a good chance that the rules designed to bring a law to life will be fair and equitable. If not, the new law may well be counterproductive.

Looking To The Future
The Telecommunications Law of 1996, though more complex than most laws, is no exception to the general scenario outlined above. A government agency, in this case the Federal Communications Commission (FCC), is charged with the task of expressing the law's intent through the rulemaking process. Whether the future will see a worst-case scenario or a best-case scenario depends on the quality of input received by our government officials.

The Worst-Case Scenario
At face value, the Telecommunications Law should be good - indeed, very good - for our industry. In theory, the law should open telecommunications to more vendors, which should foster more competition, which should, in turn, lead to lower prices. However, the vendors, which include the Regional Bell Operating Companies (RBOCs), may respond to the new law by consolidating. If this were to happen - that is, if the new law were to trigger a wave of mergers and acquisitions among the vendors - all the legislation and rulemaking would prove to be counterproductive.

In this scenario, we would see:

  • Vendors maneuvering to minimize competition.
  • Telecommunications companies announcing more layoffs.
  • Consumers and businesses paying more for telecommunications services.
  • Ordinary citizens and taxpayers bearing the social costs of having more people joining the ranks of the unemployed.

Since billions of dollars and millions of jobs are on the line, arriving at an equitable set of rules is extremely complicated. A wide range of constituencies will have a stake in the outcome of the rulemaking, and the FCC will have to consult many if not all of the interested parties. I most assuredly do not envy the job of the FCC. However, if once again called upon to contribute to the rulemaking process, I will be happy to offer my honest opinions about the matter.

It is essential that the FCC create rules that are clear, specific, pragmatic and, of course, judicious. After all, these rules will determine exactly how the major players, the RBOCs and long-distance carriers, will go about selling their services in each other's territories. Any loopholes are sure to be exploited by players as savvy as the telecommunications companies. In addition, any ambiguities will likely result in protracted lawsuits.

To prevent lawsuits, which will waste valuable time and untold sums of money, the FCC must clearly delineate the do's and don'ts that will apply in specific situations. If the rules are vague, as many are, telecommunications companies will turn to their cadres of lawyers to mark off and defend their turf. If this happens, the law of the jungle will determine who will be able to sell what in any given territory. In the end, the costs of litigation could undermine the stated intent of the Telecommunications Law, that is, better service at a more reasonable price.

The Best-Case Scenario
Allow me to outline what is, in my view, the best-case scenario. Here, the law succeeds in serving the public interest. The RBOCs and long-distance carriers maintain their identities and compete with each other on a level playing field, with their conduct regulated and their responsibilities defined by fair and equitable rules. Adequate detail in all provisions prevents frivolous lawsuits. Telecommunications companies compete not in the courts, but in the markets, and are thus free to concentrate on the job at hand: decreasing long-distance costs and improving service.

This scenario (which is more likely in my opinion) points to obvious benefits for our industry. Call centers, both inbound and outbound, will become even more cost-effective. Telemarketers will attract significantly more business from a wide variety of sales and marketing and related support activities, including catalog sales, direct marketing, infomercials, and all kinds of customer service/care/retention/loyalty operations.

Given that telemarketing has already proven it is the most cost-effective way to promote the sale of long- distance telephone services, our industry stands to gain the most from increased competition in this field. If the law succeeds in fostering this competition, we could expect outbound business to increase by at least 50 percent - and this is a conservative estimate.

Obviously, more outbound means more sales and more job security for millions of Americans. In short, everyone wins - the consumer, our industry and business in general. And, most importantly, millions of jobs will be protected by increased demand for goods and services as a result of better sales.

We Wish The FCC The Best
We recognize that the Telecommunications Law will have far-reaching effects on the economy of the U.S. as a whole. Consequently, we urge the FCC to use its usual outstanding hearing process (through industry experts and practitioners), which should set the stage for the creation of a set of rules that will fulfill the vision behind the new law. With the FCC's best efforts, and the participation of knowledgeable industry leaders, the potential of the legislation will be realized, contributing to our country's competitiveness, growth and prosperity.


Nadji Tehrani
Publisher & Editor-in-Chief

Welcome To TCCS™ SPRING '96

Unparalleled Educational And Networking Opportunities At The Call Center Industry's Leading Conference And Exhibition

The TCCS™ Conference and Exhibition series is designed to provide information and insights from three distinct sources: seminars, exhibitors, and networking opportunities. TCCS™ SPRING '96 is strong in all three areas. Since each source may impart knowledge that is unavailable from the other two, we recommend that you take advantage of all three. This way, you will be assured of having a complete learning experience.

Conference Program
As always, the TCCS™ conference program is intended for top and middle management. At this event, the topics discussed cover a wide range - from human resource development to call center technology. This year, we have added two specific tracks: Executive Solutions, which is totally focused on the information needs of upper-level management with bottom-line responsibility for telemarketing/call center operations; and MIS/Telecom Integration, which is designed to fill the informational needs of MIS/Telecom personnel responsible for implementing and maintaining CTI (computer-telephony integration) systems in call center operations. Plus, there are targeted tracks on Human Resource Development, Effective Call Center Management, Customer Service/Retention/ Loyalty, Direct/Database Marketing, Selling Savvy, Business-to-Business Marketing, 800 Service in Action and Call Center Technology/ CTI for Management that will give you a complete education. We also urge you to take advantage of the free keynotes:

  • Keynote: Creating Customer Loyalty: Your Most Critical Challenge: Thomas O. Jones (president, Elm Square Technologies, Inc. and former senior lecturer, Harvard Business School) will illustrate the surprising truths that breakthrough organizations understand and organizations in all industries can use to grow their businesses. (Tuesday, May 21, 10:00-11:00 a.m.)
  • Special Introductory Briefing: The New FTC Partnership Initiative: How We Can Protect Our Industry by Permanently Preventing Fraud: Eileen Harrington (associate director, Division of Marketing Practices, Bureau of Consumer Protection, Federal Trade Commission) will outline the FTC's new strategies for consumer education and describe how your company-and the industry as a whole-can benefit by joining partnerships to reduce fraud. After the keynote program, Ms. Harrington will also be available to answer questions in the Exhibit Hall from 11:00 a.m. to 1:00 p.m. on Tuesday at the Telemarketing(R) & Call Center Solutions(TM) and CTI For Management(TM) Booth #429. (Tuesday, May 21, 10:00-11:00 a.m.)
  • Keynote: Unlocking the Power of the Virtual Call Center and the Internet: The New Forum for Business: Scott B. Ross (president, Business Operations, chief financial officer, MCI Telecommunications) will discuss how new technologies are making it easier to perform "anytime, anywhere" operations in a new forum for business and will show you how to unlock the power of the virtual call center and the Internet. (Wednesday, May 22, 10:00-11:00 a.m.)

Exhibit Hall
While at the show, be sure to visit the Exhibit Hall.and ask questions. What you learn from exhibitors cannot be duplicated anywhere else! The Exhibit Hall at TCCS™ SPRING '96 features more than 80 exhibitors that serve the telemarketing and call center industry. Be sure to exchange business cards with everyone you meet, especially the vendors, because although you may not need their services tomorrow, in six months they may have the solution you are searching for. While in the Exhibit Hall, be sure to get the most authoritative information from the industry's most credible sources: Telemarketing� & Call Center Solutions™ and CTI For Management™ magazines. The Telemarketing� & Call Center Solutions™ and CTI For Management™ magazines booth, #429, features the Telemarketing Bookstore, which contains the largest selection of educational books and tapes in the industry.

Enjoy good food and meet with the industry's top executives at Telemania!™, the industry's most outrageous, fun-filled networking reception, which will be held on Tuesday, May 21, between 6:00 and 9:00 p.m. at the Hyatt Regency Long Beach (sponsor: Lexi International, Inc.). We look forward to welcoming you in Long Beach this May 20-23.

Nadji Tehrani
Publisher & Editor-in-Chief

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