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High Priority!
February 2003


Rich Tehrani The FTC Is About To Eliminate 3 To 5 Million Jobs
Lets Stop Them!

By Rich Tehrani
Group Editor-In-Chief, Technology Marketing Corporation


Dear President Bush:

Lets get one thing straight from the get-go. I am for your tax cut plan which was announced the week of January 6, 2003. I am, in fact, in favor of all tax cuts regardless of whether they favor the rich, the poor or the in-between. I am very sorry that some others dont agree with you; the way I see it, if the government decides to give us back our own money, we should hold out our hands, be polite, smile, and say, Thank You, then promise to spend it quickly by going to the mall or our PC and start shopping the slow economy into submission.

Bigger Is Not Always Better
But our government is big. Big organizations sometimes do things that dont make sense, as one hand often has no clue what the other hand is doing. So when I was listening to my TV on a recent morning and I heard a reporter say that your tax plan will cost $674 billion dollars over ten years and create two million jobs in the next three years, I got to thinking, you really do care about job creation.

A Net Negative Number Of Jobs
But wait. Before I express my gratitude by quitting my job and offering up my services as a telemarketer to help re-elect you in 2004, there is a bit of irony you may want to help me out with. You see, the Federal Trade Commission (FTC) has recently tried to kill outbound telemarketing through the establishment of a national do-not-call list, as well as many other changes to its Telemarketing Sales Rule (TSR), which will make it virtually impossible to conduct business by phone. Very soon, the Federal Communications Commission (FCC) will chime in with more rules aimed at making the lives of all companies using the telephone as a marketing vehicle more difficult. 

Whether you are a fan of telemarketing or not, lets look at what this could do to the American economy. Roughly three million people are involved in outbound calling. Another 500,000 are support staff to those three million. Another 1.5 million jobs rely on outbound telemarketers for their viability. Think factory workers, the transportation sector, technology providers, distribution, customer service, etc. If outbound telemarketing became illegal overnight, we would lose between three and five million jobs in the next three to five years. 

Getting back to your tax cut, I am so happy to hear you believe it will create two million jobs. Before we start opening champagne bottles, however, we need to start working on the next tax cut of $1.685 trillion dollars. This number is basically your tax cut of 674 billion multiplied by 2.5 and is proportionately equal to what it will take to put five million more people back to work.

Mr. President, telemarketing is a job creation and job protection tool. It is by far the most effective sales tool. Of course every politician knows thisthat is why most of them rely on it so heavily when they campaign. It has been said that, Nothing happens until someone sells something. You see, Mr. President, the current economic recession is caused by a lack of sales. You repeatedly tell the American people that you are trying to stimulate spending in the business and consumer sectors to generate more sales. The FTC and FCC, on the other hand, are trying to kill outbound telemarketing, which is regarded worldwide as the number one selling and job creation and protection tool known to mankind.

A Problem That Is Essentially Solved
Telemarketing, like any other type of marketing, is not perfect. Most marketers use the telephone well, annoying almost no one. Like every type of marketing (direct mail, e-mail, fax, door-to-door), there are some that use it improperly. The good news is that the annoyance of outbound telemarketing has indeed been reduced substantially due to a confluence of factors.

The Direct Marketing Association (DMA) has had a national do-not-call list for 25 years. This list has well over four million subscribers on it. 
Twenty-plus states have their own do-not-call lists already.
Call blocking technology makes it easy to keep telemarketing calls from reaching you if you choose.
Caller I.D. makes it easy to identify calls you wish not to receive.
There is even call-waiting caller I.D. available, so it is possible to never pick up the phone on a telemarketer if you so choose.
There is even Internet caller I.D. that alerts you to who may be calling while you are surfing the Web via your phone line.
Finally, there are numerous inexpensive devices that consumers can purchase to eliminate most telemarketing calls if they choose.

Big Brother Is Screening
So the question becomes, why does the federal government need to shape the way marketing is done in this country? If it was such an offensive practice, why are outbound telemarketers so successful? Furthermore, if we conservatively assume that an outbound salesperson sells on average $100,000 per year, do you realize that outbound telemarketing is responsible for at least $300 billion dollars of sales in this country? President Bush, the FTC and FCC are out of step with your policy of growing the economy and creating jobs. Lets do something about this before its too late.

Rules That Defy Logic
Mr. Bush, we need to do something about this proposed Telemarketing Sales Rule (TSR). It is rife with inconsistencies and problems. For example, if a consumer places his name on the do-not-call list, he can still be called by companies over which the Federal Trade Commission has no jurisdiction, such as long-distance phone companies, airlines, banks, federal credit unions and insurance companies (all of whom are exempt from the FTCs rules). These exempt companies are allowed to make the calls themselves, due to this jurisdictional loophole, but their outsourced agencies, who ARE governed by FTC jurisdiction, are required to follow the TSR. Since most of these companies excepted from the rules outsource their call center functions, it essentially hamstrings the companies that are technically exceptedincluding non-profit groups, who often hire teleservices outsourcers to make their calls for them.

Arbitrary sub-rules in the text of the TSR make me shake my head. Business-to-business calls ARE allowed, as long as they dont involve office or cleaning supplies. CLEANING SUPPLIES? Are the feds going to be listening in to make sure the dreaded words toilet bowl cleaner arent uttered in our b-to-b calls?

Call center outsourcers are responsible for 1.5 million jobs in this country and are the most ethical and law-abiding telemarketers in the country. Why would you threaten the most law-abiding segment of the market and so many jobs? These outsourcers already comply with state do-not-call lists and the DMA do-not-call list. The top 75 domestic outsourcers alone were responsible for 13.2 billion billable minutes of long distance last year. Imagine what will happen to the telecom industry when these minutes are lost? At four cents per minute, this amounts to a minimum of $500,000,000 of annual revenue to the telephone companies per year! Can you imagine how many more layoffs we will witness in the telecom and tech sector if this and more annual revenue is lost?

The new Telemarketing Sales Rule is unnecessary, defies reason and logic and, worst of all, makes the life of many corporations in a slow economy infinitely more difficult!

Handicapping American Companies And Sending Jobs To Other Countries
Not only will this rule destroy countless millions of U.S. jobs, it will give companies operating from overseas an infinite advantage over their domestic counterparts. Even without any new regulations, telemarketing jobs are being driven overseas due to much lower labor costs and the fact that telephony can travel over IP networks almost for free, regardless of location. If this new rule were to go into effect, a company based outside our borders can sell anything over the phone and call countless U.S. households regardless of whether these households are on our federal do-not-call list. The worst part is that the FTC wont do anything about it. We cant even stop North Korea from shipping Scud missiles to Yemen, are we going to be able to extradite their telemarketers? India and the Philippines are opening call centers at a rapid pace. Is the FTC going to go door-to-door in Southeast Asia and Africa looking for telemarketers who violated the national do-not-call list? I suspect the CIA has more important things to worry about than telemarketing non-compliance. We will certainly destroy many American companies with this rule. Worse yet, we will drive many companies overseas, where they are effectively protected from these frivolous and biased rules that defy reason, logic and common sense.

Seeing The Complete Picture
The government and everyone else needs to realize that there are many examples of outbound telemarketing used extremely effectively and without annoyance. For example, our local department store, Loehmanns, calls my wife, my sister and my mother every year on their birthdays and gives them incredible deals on all merchandise in the store. This is irresistible to all of them, and as such, has generated a tremendous amount of sales, which eventually became taxes. Is this a bad practice? Not according to my female relatives. Does the government want to lump every outbound call into the same category? Is this the most important thing the government should be doing? Sure, many people dont like outbound telemarketers, but who will be next? Will used car salesmen have to go back to selling copiers and vacuum cleaners? What will you do to contractors and lawyers?

Lets Punish The Guilty People
Now lets get down to those telemarketers who dont do their homework. You know the ones, they call you in your apartment and try to sell you aluminum siding. These people are a huge nuisance to all of us. Not only do they have nothing to gain by offering services in which customers cant possibly be interested, they turn people against telemarketing. Lets establish laws that deal with incidents like these, which constitute most, if not all, of the problem instead of regulating industries haphazardly. After all, a murderer using a scalpel as a murder weapon shouldnt result in laws preventing surgeons from operatingRight?

When I was 16, I sold subscriptions for our local newspaper, the Stamford Advocate, as a telemarketer. This job offered me an opportunity to learn the value of hard work and helped shape me into the person I am today. If the FTC and FCC have their way, these opportunities wont exist for tomorrows youth.

Can The Market Regulate Itself?
Lets ask ourselves one question. If telemarketing is such a bad thing, and people hate receiving calls at home so much, why are so many telemarketers doing so well? Obviously people are buying goods and services. In fact, there are billions of dollars of goods and services sold by phone annually!

In the worst-case scenario, when answering a telephone call from a telemarketer, a person can just politely say no and hang up if they are not interested. Whats next, banning billboards and radio ads? 

Mr. President, as a courageous leader, I urge you to think through this devastating action by the FTC (and the future, planned actions of the FCC) and come out against poorly crafted legislation that will cost this country three to five million jobs!

Sincerely,

Rich Tehrani
Group Publisher, 
Group Editor-in-Chief
rtehrani@tmcnet.com

A Call To Action
The future of the call center/CRM industry has never been in such jeopardy as now. Completely unfair and devastating rules are being imposed on us by those who do not have a clue about our industry. It is unfortunate that several ill-advised rules were decided upon without a full understanding of their economic impact. It is vitally important that all of our readers and the management and agents of all teleservices agencies to write letters in opposition to this ruling to your Senators, Congressmen, the FTC, the FCC, the Department of Commerce and all media outlets on a daily, if not hourly, basis and send this editorial along with your comments.

It is up to all of us to protect our industry by working together to eliminate unnecessary and counterproductive government interference, which is about to send another three to five million jobs offshore, crippling the U.S. economy! Please send you mass e-mails with this editorial TODAY.

To contact your Congressional representatives, or read more information about the TSR, visit the DMAs resource page at http://congress.nw.dc.us/aim/home/

As usual, we welcome your comments regarding this letter.

[ Return To The February 2003 Table Of Contents ]


Do As I Say, Not As I Do

2002 was the year of, Do as I say, not as I do. Investment banking firms guided stocks ever higher while shorting shares at the same time; add to that the Catholic Church scandal and, of course, the governments acceptance of millions of dollars from Enron while this company simultaneously stole money from countless investors. The government then came out and told us what Enron did was wrong!

It should come as no surprise that in 2002, at the height of Do as I say and not as I do, the FTC was busily working to hamstring most every telemarketing call except those that came from charities and, of course, politicians reelection campaign committees! I am at a loss for words over the double standard that politicians have for themselves. Do they think they are more important than corporations? They arent. This country is so great because we have elected officials running our country; this is not a dictatorship. When the government begins to pass rules that apply to everyone but themselves, or passes rules that apply to some of their friends and not others, you have to stop and thinkis this the right direction for a country that values its freedoms as much as we do?

[ Return To The February 2003 Table Of Contents ]


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