Pulling the plug: association predicts new U.S. registry could kill up to two million jobs in the call centre industry.

For some people, telemarketers represent an unwanted dinner time intrusion. But to others, it represents a source of primary or supplemental income in an otherwise slack job environment.

While it is too early to determine what impact a U.S. do-not-call registry, slated to take effect this fall, will have on the thousands of telemarketers, customer service representatives and technicians in the Northern Ontario call centre industry, one industry group expresses "sufficient concern" for both outbound and inbound Canadian operators.

"The immediate impact is for outbound operators with calls to the U.S.," says Scott Rennie, a Sudbury-based spokesman for the Customer Contact Strategy Forum, a council of 250 senior executives with inbound-call capabilities in the financial, insurance, telephone and telecommunications sector. But the registry may have a negative impact on inbound Canadian operators as well, he says.

According to tougher regulations set up by the U.S. Federation Communications Commission (FCC) and the Federal Trade Commission (FTC), telemarketers who call registered households on the do-not-call list on or after Oct. 1 could face fines of up to $11,000 (US) a call. Consumers will also have the option to sue telemarketers directly for up to $500 a call.

The government-run do-not-call database is designed to block unsolicited telephone sales calls.

Under FCC/FTC rules, telemarketing companies must have an established business relationship like a service contract with a client company, which allows them to contact a customer up to 18 months after a business transaction and three months after an inquiry or application.

Other organizations such as political organizations, charities, telephone surveyors and insurance businesses will be exempt from the registry.

Rennie says while the registry rules remain "fuzzy," his group's interpretation is that customer service practices of up-selling and cross-selling on packages like insurance services can, by definition, be categorized as an outbound call.

"Once you've gone from the initial intention of why the customer was calling in to now selling them something different ... that now becomes an outbound call by definition of the FCC/FTC on this registry.

"The line between sales and service is being blurred."

Rennie says Canadian telemarketing firms are not necessarily shielded from this registry since the U.S. government will go after an American parent company or the company the telemarketer is doing work for.

Some outbound telemarketing firms contacted by Northern Ontario Business referred media inquiries to their corporate headquarters, but one Sudbury-based call centre director expects business to remain as usual for now.

"There really are no predictions until this happens," says Thomas Stella, site director at Omega Direct in downtown Sudbury. "We are not anticipating any huge problems."

The centre, which employs 350 full-time equivalent, deals primarily with American customers in the U.S. financial and banking sector.

"Most of our clients are existing customers, we think, but the definition is not clearly defined."

Stella says the action that hurts the industry the most is the FCC's new abandon rate law requiring a telemarketing call being abandoned if it is not transferred to a live sales agent within two seconds of a recipient's greeting.

Telemarketers must also ensure that predictive (automatic) dialers abandon no more than three per cent of all calls placed and answered by a person.

Although she is still collecting information on the ramifications of the registry, Stephanie Harris, a City of Greater Sudbury business development officer, says, based on her conversations with various site managers, she does not suspect the city's vibrant call centre industry will be severely impacted by the new registry.

Nor does she think it will hinder the city's chances of attracting new centres or encouraging expansion in existing facilities.

"But not all the information is there right now," Harris says. "It still has to be fully interpreted."

In Sudbury, where nine call centres employ 4,000 full- and part-time workers, the city's revised strategy is to move beyond outbound call centres and concentrate on attracting high-end inbound centres, such as the new Canadian Blood Services Centre, Harris explains.

"We're at the new level of sophistication with call centres," says Harris.

"We know the trends in outbound centres and we're pursuing a different tack. We're not refusing them, but we're looking at different engines in tourism, mining and health-related sector in the long term."

In early July, the registry was overwhelmed with more than 15 million people signing up their telephone numbers. Federal officials expect to have about 60 million households signed up by the time it goes into effect.

Watching this unfold is the Canadian Radio-television and Telecommunications Commission (CRTC), which is reviewing its regulations on "unsolicited telecommunications" and is considering a Canadian do-not-call list.

The agency has guidelines for unsolicited communications, but no power to enforce them.

Since launching the review of its current rules, they have received 4,000 complaints and public submissions since May 2002.

The CRTC expects to release a report by this fall.

The Canadian Marketing Association maintains a do-not-call registry, but it is only for organizations on a volunteer basis. U.S. industry lobby groups such as the American Teleservices Association (ATA) say the do-not-call registry could force as many as two million of the six million people in the telemarketing industry out of work, most of them single moms, students and the handicapped. U.S. government officials say telemarketers' doomsday predictions are greatly exaggerated.

The ATA is challenging the legality of the registry in a Colorado court. While Rennie places no predictions on Canadian job losses, "anybody who says the potential is not there is fooling themselves," he says.

Rennie suspects many call centre site managers are waiting for corporate direction on whether to rethink their strategies for outbound calls, re-distribute those calls to existing customers and work within the rules, or work harder to phone non-registered households.

But another industry watcher believes the registry will have a minimal impact on the North American industry.

"It's probably going to have a lot less impact than people imagine," says Raj Wadhwani, editor-in-chief of ContactCentreWorld.com, a Thunder Bay-based online call centre industry trade publication. "It's going to start affecting those companies just picking up consumer lists and randomly calling."

The registry is aimed at cold-calling telemarketers gathering a database of new clients with which they have no existing business relationship with.

"They're the ones going to face the most difficulty," Wadhwani says. Wadhwani's publication ran some features on the registry, but to date has received very little negative feedback from subscribers.

Wadhwani, who managed call centres in the United Kingdom, observes North America is finally catching up to rules and regulations already set up in the European Union countries through agencies such as the European Federation of Direct Marketing.

"Germany for example has more stringent abandon rules than the States at moment (with) rules and regulations for predictive dialers."

There have always been guidelines by various direct marketing associations as to what is considered good practice, such as not phoning on Sundays or after 9 p.m. But actions by a few bad operators have led to this registry, he says.

"It's really been generated by consumer backlash saying this isn't good," says Wadhwani.

"The phone is a fantastic business tool, but it's also very intrusive. If it rings you are almost obliged to answer it."

www.ataconnect.org (American Teleservices Association)

www.ftc.gov (U.S. Federal Trade Commission)

www.ccstrategyforum.com