Comments:

CALL COMMAND, INC.
11500 NORTHLAKE DRIVE, SUITE 240
CINCINNATI, OHIO 45249

December 18, 2006
Federal Trade Commission
Office of the Secretary
Room H-135 (Annex K)
600 Pennsylvania Avenue NW
Washington, DC  20580

Re: TSR Prerecorded Call Prohibition and Call Abandonment Standard  Modification, Project No. R411001 

Dear Ladies and Gentlemen:

This letter is written in response to the FTC’s request for public comments in  reference to proposed amendments to the Telemarketing Sales Rule (“TSR”).  Call  Command, Inc. is in the business of voice marketing, providing its customers  (such as automobile dealers) with technology for sending prerecorded messages.   Call Command also makes available various other medium for customer  communications, including without limitation communication through text  messages and e-mail.  A typical use of Call Command’s technology includes  sending of prerecorded calls for notifications of product recalls such as automobile  defects and reminders of scheduled appointments, as well as targeted marketing  campaigns sent to customers with whom there exists an established business  relationship.  References in this letter to “consumers” generally refers to the retail  customers of Call Command’s automobile dealer clients.

Call Command is recognized as a market leader in compliance and service and  fully intends to continue to be a leader in compliance regardless of the outcome of  the proposed amendments to the TSR.  Call Command welcomes the spirit and  intent of the proposed modifications but asks the FTC to clarify its position in  some cases and to reconsider the means in which changes will be made in other  cases.  The purpose of this letter is to provide public comment in response to the  TSR amendment proposals and to respectfully request the FTC to:

1. Reconsider the proposed prerecorded telemarketing call prohibition;

2. Provide guidance on the difference between a “telemarketing” call and  an “informational” call;

3. Provide guidance on the manner of obtaining “express consent” if the  proposed amendment to the call abandonment safe harbor is adopted; and

4. If the proposed “express consent” requirement in Section 310.4(b)(1)(v)  is adopted:

(a) amend the call abandonment prohibition in Section 310.4(b)(1)(iv) to  clarify that the prohibition in 310.4(b)(1)(iv) does not apply to calls where “express  consent” is obtained; and

(b) provide industry with at least 18 months to obtain the express consent  of its customers to receive prerecorded telemarketing calls due to the substantial  burden such a new compliance requirement imposes on industry and forebear  enforcement of the call abandonment restrictions with respect to such calls.

1. Reconsider the proposed prerecorded telemarketing call prohibition.

Call Command’s customers find substantial value in sending targeted prerecorded  voice messages to consumers with whom they have an existing business  relationship.  The return on investment to these customers is significant (several  hundred percent) while at the same time placing minimal imposition on customer  privacy rights.  The reason is that customers appreciate receiving calls informing  them of important information (such as time for servicing or the availability of new  products).  Only 1.14% of calls sent through the use of Call Command’s  technology since inception has resulted in requests by consumers to opt out of  receiving these calls.

Call Command believes that the reason for the substantially small amount of opt  outs is that it only sends information in compliance with applicable laws.   Consumers have come to depend on and react favorably toward receiving these  calls.  Consumers are not receiving information that they prefer not to receive, and  Call Command strictly limits calls to persons who legally can receive the calls.   Unfortunately, there are other companies in the telemarketing industry who send  calls completely blind to the TSR, the Telephone Consumer Protection Act and  other applicable laws.  These are the same types of companies that Call  Command finds itself sending cease and desist letters for infringement of Call  Command’s good name.  These noncompliant companies do in fact offend the

privacy rights of consumers, and these offended consumers are quick to respond  as to their perceived annoyance of prerecorded messages.  Those companies that  are compliant do not receive regular customer complaints or frequent requests not  to receive further calls.

Call Command respectfully request the FTC to use less burdensome means than  an absolute prohibition on prerecorded telemarketing calls to accomplish its goal  of consumer protection.    The recommended goal is to find a middle ground that is  in proportion to the interest of both consumers and industry.

Call Command asks the FTC to reconsider a solution that accomplishes the

objectives of the FTC and is in fact narrowly tailored to satisfy those objectives.   That solution is to simply require all prerecorded telemarketing calls to include an  opt out mechanism such as a push button to make a do not call request (i.e., as  VMBC proposed).  Call Command believes that this is in fact just as easy as  delivering a do not call (“DNC”) request directly to a live operator. It is our position  and experience that most consumers feel better about leaving the DNC request on  a recorded message or otherwise electronically than they do facing a potentially  uncomfortable discussion with a live sales agent.  The burden, if any, placed on a  consumer to push a button and make a DNC request compared to the substantial  harm to industry that would result from an absolute prohibition on prerecorded  telemarketing calls is insignificant.

Another alternative that is narrowly tailored and meets the goals of the FTC that  Call Command asks the FTC to consider is to modify DNC registry listings to  provide consumers the right to opt out of calls from businesses in which they have  an existing business relationship, political calls, etc.  Those persons already on  the list could either submit a new registration with any specific opt outs or they  could wait until their current registration expires and update the preferences with  their new registration.  The FTC’s express consent proposal would still apply for  specific situations where a consumer prefers to receive calls that otherwise would  cause a violation of the DNC registry.

The FTC indicated in its recent Denial of Petition for Proposed Rulemaking  that “the proposed amendment explicitly limiting the use of prerecorded  telemarketing calls will not change the existing paperwork burden on sellers or  telemarketers.  It simply makes the TSR’s existing prohibition explicit rather than  imposing a new prohibition.  Thus, the proposed amendment will, if anything,  reduce the paperwork burden and the amount of time required for telemarketers to  comply with the TSR.”  Call Command feels that the contrary is true in that the  proposed prohibition will substantially increase the amount of paperwork burden on  sellers and on telemarketers.

While the TSR does include a call abandonment prohibition, it does not expressly  prevent prerecorded calls.  Rather it limits the amount of call abandonment  permissible pursuant to Section 310.4(b)(4) to a small percentage (i.e., 3%).   Admittedly (and supporting the FTC’s position), as a substantial number of  prerecorded calls are made, the likelihood of violating the 3% rule increases.  This  is not to say, however, that prerecorded telemarketing calls are per se  impermissible based on the existing TSR.  Furthermore, the FCC’s TCPA  expressly permits prerecorded calls to consumers with whom an established  business relationship exists. 

Equally important, however, is the fact that prior to the FTC’s Notice of Proposed  Rulemaking in late 2004, industry had relied upon the FCC’s position and the  apparent notion that the FCC’s more liberal position was the position being  enforced in the industry.  In addition, the FTC also published its intent to forbear  enforcement of the call abandonment provision.  Small businesses have relied on  the preceding with the result that a change in the law will have a major impact and  cause a substantial burden on the paperwork of sellers and telemarketers. Call Command estimates that the costs to its clients who feel that targeted  solicitation (as opposed to relationship driven marketing) will be necessary as a  result of the proposed prohibition on prerecorded telemarketing calls is estimated  at ten times higher considering the fact that direct mail would likely become the  medium for communication with consumers.  This is coupled with the fact that  direct mail marketing is not nearly as effective as voice marketing. Added to the  preceding is the substantial costs and expenses that would be incurred to obtain  express consent agreements from consumers.  Call Command feels that these  substantial costs could be avoided by imposing a less restrictive means to  accomplish the FTC’s objectives.

Call Command applauds the FTC for carefully balancing consumer and industry  interests in its enactment of regulations pursuant to the Controlling the Assault of  Non-Solicited Pornography and Marketing Act of 2003 (“CAN-SPAM”).  In the CAN- SPAM final Rule, the FTC protects consumer privacy by giving e-mail recipients  the right to opt out of receiving future commercial e-mail messages from a  particular sender.  The Rule does not prohibit any marketer from sending a  commercial e-mail message to any recipient until the recipient submits an opt out  request.  The FTC reasonably and wisely requires certain opt out disclosures to be  made by senders when they communicate by e-mail with consumers but puts the  onus on the consumer to submit an opt out request.  The result is that unwanted  commercial e-mails are stopped by consumers one at a time.  Thus the fit

between the government’s interest in protecting consumer privacy and industry’s  interest in communicating with consumers was satisfied by a narrowly tailored  means.  By analogy, Call Command asks the FTC to consider a similar “fit” in the  case of regulation of prerecorded telemarketing calls, including fit between the  government’s interest in protecting consumer privacy with industry’s interest in  communicating with its customers.

The FTC and FCC rules governing telemarketing calls already impose substantial,  but reasonable, restrictions on sending of calls to consumers, including calls sent  by prerecorded message.  Call Command believes that these restrictions  adequately protect consumers, and this is evidenced by Call Command’s  substantially low opt out rates.  Call Command understands that other companies  in its industry that comply with the existing rules also enjoy substantially low opt  out rates.  This leads Call Command to the conclusion that a reasonable solution  to consumer comments received by the FTC is more enforcement against those  that violate the rules (along with a further safe harbor presenting a simple method  for making DNC requests such as a push button) rather than punishment of the  companies, such as Call Command, with excellent compliance records. Because  reasonable rules already exist, Call Command resists a blanket prohibition on  sending of prerecorded messages. 

Because of the above reasons, Call Command respectfully requests that the FTC  withdraw the proposed absolute prohibition on prerecorded telemarketing calls and  reconsider promulgating a safe harbor that gives consumers the ability to opt out.

2. Provide guidance on the difference between a “telemarketing” call and  an “informational” call.

Regardless of whether the FTC adopts the proposed prohibition on prerecorded  telemarketing calls, Call Command respectfully requests the FTC to provide further  guidance on the difference between “telemarketing” calls and “informational” calls. 

Since the date that the FTC published its proposed prohibition on prerecorded  telemarketing calls through the current date, Call Command continues to  experience significant misconceptions in the industry that all prerecorded calls are  impermissible.  The FTC made abundantly clear that “informational” calls have  never been regulated and can continue to be sent.  Yet, unscrupulous competitors  who offer other mediums of advertising continue to extract statements from the  FTC’s recent Denial of Petition for Proposed Rulemaking indicating that all  prerecorded calls are prohibited.  This has caused substantial marketplace  confusion.  In addition, because Call Command desires to continue as a market  leader in compliance, further clarification of “informational” calls is crucial.

3. Provide guidance on the manner of obtaining “express consent” if the  proposed amendment to the call abandonment safe harbor is adopted.

Call Command asks the FTC to consider a less restrictive approach to obtaining a  consumer’s express consent to receive prerecorded telemarketing calls. Call  Command believes that an approach such as requiring the sender to be able to  document a consumer’s intent to be called presents an alternative approach that  still accomplishes the FTC’s objectives.  The pending FTC proposal requires a  separate written “agreement” from the consumer.  While Call Command agrees  with the premise of not sending a prerecorded call to a consumer unless the  consumer desires to be called, requiring a written agreement will impose a  substantial burden on Call Command and its customers.  Call Command also

requests the FTC to provide further guidance regarding the propriety of obtaining  express consent by phone and via electronic means.

Call Command’s customers generally receive a consumer’s consent to be called  by requesting that the consumer provide one or more phone numbers where the  consumer can be called.  This may be part of an application completed by the  consumer or may be accomplished as part of a point of sale.  It some cases it  may be considered an “agreement” and in other cases it may be deemed  an “acknowledgement.” As noted, Call Command’s experience indicates that

consumers welcome the calls sent by Call Command’s customers.  However, Call  Command feels that to now separately contact each of the millions of consumers  and request them to sign a written agreement that complies with the new proposal  imposes a substantial time and cost burden on Call Command and its customers.

Call Command also requests the FTC to provide further guidance on the means  that can be used to obtain express consent.  Specifically, Call Command asks the  FTC to confirm that both (i) a recorded telephone call where consent is given by  phone and (ii) an electronic consent given by pushing a particular button on the  consumer’s phone (i.e., press the number “4” key to give consent) each are  sufficient methods of obtaining and providing consent.  Additionally, Call Command  requests the FTC to confirm that providing consent electronically such as in  response to an e-mail or by providing consent by clicking on a link established for  that purpose on the internet are also sufficient methods of providing consent  electronically.

With respect to consents obtained through e-mail and the internet, it is assumed  that the answer is straight forward  i.e., such methods of consent are clearly  considered written consents under the Federal E-Sign Act (“E-Sign”).

Call Command also requests the FTC to confirm in the TSR that obtaining consent  by phone (whether recorded or via a push button that can be captured) is

permissible or will be considered written consent.  The FTC’s apparent goal of  express consent is to substantiate a consumer’s intent to be called. Call  Command believes that any method which can substantiate such intent should be  permitted.  With respect to E-Sign, however, Call Command asks that the FTC  acknowledge in the TSR that a verbal consent is permissible. 

The following excerpt from the Congressional Record does however support using  voice data for signing purposes in other contexts:

Section 101c-6 does not preclude the consumer from using her voice to sign or  approve that record.  Proper voice signatures can be very effective in confirming a  persons informed intent to be legally obligated. Therefore, the consumer could  conceivably use an oral or voice signature to sign a text record that was required  to be given to her “in writing.”  Moreover, the person who originated the text record  could authenticate it with a voice signature as well. The spoken words of the  signature might be something like I Jane Consumer hereby sign and agree to this  loan document and notice of interest charges.

146 Cong. Rec. S. 5281, 5284 (2000) (Abraham explanatory statement).  It thus  appears that consent given by phone satisfies E-Sign so long as the consent can  be verified.  Due to the potential for interpretation of the preceding, Call Command  requests the FTC to provide guidance on this issue in support of obtaining express  consent by phone.

4. If the proposed “express consent” requirement in Section 310.4(b)(1)(v)  is adopted:

(a) amend the call abandonment prohibition in Section 310.4(b)(1)(iv) to  clarify that the prohibition in 310.4(b)(1)(iv) does not apply to calls where “express  consent” is obtained  -

If the FTC elects to adopt its proposed requirement of express consent as  described in proposed Section 310.4(b)(1)(v), it appears necessary to further state  in the TSR that the call abandonment provision described in 310.4(b)(1)(iv) does  not apply where express consent is obtained.  Without such a modification, even if  a sender of prerecorded calls had express written consents from all consumers  who will receive the calls, the prerecorded message campaign would likely violate  the maximum 3% of abandoned calls.

(b) provide industry with at least 18 months to obtain the express consent  of its customers to receive prerecorded telemarketing calls due to the substantial  burden such a new compliance requirement imposes on industry.

Because of the substantial burden placed on industry where businesses deem it  appropriate to obtain express consent (see discussion above), Call Command  respectfully requests the FTC to provide industry with 18 months to obtain said  consents and to forebear enforcement of violations of call abandonment with  respect to these consumers.

Call Command continues to support the FTC’s efforts in this area. Should the FTC  desire to discuss any of the above comments with Call Command, please feel free  to contact Al Babbington, CEO, at 513-792-9212.

Respectfully submitted,

CALL COMMAND, INC

By:_________________________________ 
Thomas A. Babbington,
CEO 
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