FTC to Delay Enforcement on Pre-recorded Messages

The Federal Trade Commission will extend beyond Jan. 2 its policy of not bringing enforcement against telemarketers that deliver pre-recorded messages to consumers, pending further agency review of current policies.

"This is good news for the many marketers who rely on pre-recorded messages for communication with customers," says Jerry Cerasale, senior vice president of government affairs at the Direct Marketing Association, one of about a half dozen organizations that had petitioned the FTC to delay enforcement. The FTC announcement "means that customers can continue to conduct ongoing campaigns without fear of punishment until the issue is resolved," he says.

Enforcement, DMA argued, would have had the effect of "a flat prohibition on pre-recorded messages."

Joining DMA in filing the petitions were medSage Technologies and Silverlink Communications, two telemarketers that place pre-recorded calls on behalf of healthcare providers and health management organizations (HMOs) urging their patients to refill prescriptions, get flu shots, childhood immunizations, routine mammograms, and colonoscopies, and the like. Both firms argued that the start of enforcement could deprive between 10 million and 20 million patients each year with "medically necessary information."

Minutepoll, a small telemarketing firm that also filed a petition with the FTC, argued that strict enforcement would bring "irreparable harm" to smaller telemarketers who would have been forced to shut down operations Jan. 2. Many such firms cannot be "cost-competitive" with large call centers in placing live telemarketing calls, it argued.

The FTC initially set the Jan. 2 deadline as part of amendments to the federal Telemarketing Sales Rule that it passed in October. These latest amendments would have banned delivering pre-recorded messages, even to consumers with whom sellers had established business relationships, without first obtaining expressed written consent from the consumers.

DMA further argued that even pre-recorded messages that consumers "affirmatively requested would need to be discontinued" because businesses would not have had sufficient time during their busy holiday season "to obtain the proposed prior written consents." 

Where such consent can be obtained, though, the rewards to telemarketers can be great, predicts on-demand voice messaging provider Vontoo. "Permission-based voice messaging is an important marketing tool for companies to communicate quickly and inexpensively with their current customers. In 2007, smart marketers who comply with regulations will create deeper, more lasting customer relationships by adding the emotion and excitement of voice to their marketing efforts," says John Wechsler, president and chief operating officer of Vontoo.

Younger consumers will be particularly receptive to this type of marketing, especially when it involves tailored sound bites sent to cell phones, Vontoo expects.