AT&T Communications

AT&T Communications of California, Inc. (AT&T) contends that telemarketing has become an integral part of the manner in which companies from a wide array of industries conduct business. According to AT&T, it can be a highly cost-efficient means of gathering data as well as providing consumers with important information about products and services that they want and need. AT&T adds that, with the concern about the safety of mail, telemarketing has become an even more important tool for reaching out to the marketplace.

The use of automatic dialing devices, or predictive dialers, increases the efficiency of telemarketing agents by dialing several numbers simultaneously and, when a live voice answers a call, connecting that individual to an agent. AT&T acknowledges that there are times when the use of a predictive dialer will result in more calls being answered by live voices than there are agents available, and that some calls may then be terminated by the equipment after a predetermined maximum period of time. AT&T terms this "a very rare occurrence" and the worst result from a telemarketer's perspective because of the loss of a potential customer.

AT&T states that there are ambiguities in Pub. Util. Code § 2785.5. For example, AT&T states, the statute does not explain what it means for an agent to be "available" to accept a call. Predictive dialers require a brief delay from the moment a call is answered to determine if the answering party is a live person or an answering machine. According to AT&T, if the statute requires that an agent be available from the moment the call is answered, then the error rate should be higher. If the agent need only be available when the predictive dialer determines that a live person has answered, then the rate can be lower. While workshops could be helpful in resolving an issue like this, AT&T states that if a decision is based solely on comments, the acceptable error rate that should be adopted is 5%.

AT&T contends that the more reasonable interpretation of Section 2785.5 is that agents should be available for each call answered by a live person. It states: "Given that individuals answer less than 20% (on average) of calls [predictive dialers] dial, any requirement that an agent be available for every call would drastically increase costs and markedly decrease the utility of [predictive dialers]." (AT&T Comments, at 5.) This interpretation of the statute is consistent with what the telemarketing industry refers to as an "abandonment rate," which covers only those calls where an individual answers.

AT&T explains that abandoned calls include both dropped calls and aborted calls. A dropped call occurs when a person answers the phone and hangs up before being connected to an agent. A call is not considered dropped if the person hangs up in less than a certain number of seconds, which varies throughout the industry. The reason for a cushion before the call is counted as dropped is that the predictive dialer requires a certain amount of lag time from the moment the call is answered to determine if a person, as opposed to an answering machine, is answering the call. Generally, according to AT&T, the predictive dialer requires two seconds from the moment the call is answered to make this determination.

Aborted calls are those where the predictive dialer terminates the call even though a live person has answered. This occurs when the dialer has detected a live person but placed the call in a queue because no agent is available. If no agent is available for more than a preset period of time (usually about five seconds, according to AT&T), the dialer will terminate the call. AT&T states that it and other responsible telemarketers make every attempt to minimize aborted calls because they irritate the consumer and reduce the opportunity for sales.

AT&T recommends that abandoned calls, or "errors," should include all calls where a live person answers the phone and is not connected to an agent within four seconds. According to AT&T, the process of lifting the handset and saying hello takes about two seconds of the four-second delay. If the answering person hangs up before the four-second period, AT&T would not count that call as an error. If the answering party remains on the line beyond the four-second period and is eventually connected to an agent, that call would be counted as an error.

AT&T urges that the error rate be calculated over a quarterly period to avoid fluctuations in error rates due to the different times that such calls are placed. AT&T recommends that telemarketers should calculate the error rate for every three-month period (beginning January 1) by dividing the total number of calls made to recipients in California into the total number of calls made to recipients in California that were answered by an individual but not connected to an agent within four seconds.

With these definitions in mind, AT&T states that a 5% error rate is reasonable. Setting the error rate too low, it states, will dramatically increase costs to companies that use telemarketing and potentially decrease their ability to compete. AT&T states that telecommunications companies rely heavily on telemarketing to sell their services because retail outlets are not a practical means of presenting these services. AT&T contends that a low error rate would impede the ability of companies to compete in new markets, like the market for local telephone service.

As to the proposed record-keeping requirements, AT&T argues that requiring records for each call that a predictive dialer makes is unduly burdensome. It recommends that to the extent individual call records are required, they should include only the date, time and number called. AT&T also believes a three-year retention period is excessive, and that a one-year period would serve the Commission's needs. AT&T also urges that submission of records to the Commission should include appropriate non-disclosure measures to protect confidential and proprietary information like individual telephone numbers, calling patterns and target markets.

In its reply comments, AT&T modifies its position to urge a six-month implementation period to allow users of predictive dialers to develop the procedures necessary for compliance. It also agrees with TURN, UCAN and ORA that the error rate should be calculated by dividing the total number of errors by the total number of calls answered by a person (rather than the total number of all calls dialed). It reiterates its position that the most appropriate error rate is 5%, calculated quarterly, where an error is any call answered by a person but not connected to an agent within four seconds.

AT&T states that, contrary to TURN's position, a predictive dialer does not disconnect a call when a live person answers and no agent is available. Rather, the dialer will abort the call only when there has not been an agent available for a period of time, generally five or six seconds. AT&T states that its proposal, requiring connection to an agent within four seconds, will minimize the risk that individuals will receive hang-ups. According to AT&T, the harm to individuals inconvenienced by hang-ups or a slight delay in being connected to an agent is outweighed by the benefits of using predictive dialers. It notes that the telemarketing industry provides employment to millions. As to concerns that hang-ups might indicate criminal conduct, AT&T urges an education campaign to inform the public about the operation of predictive dialers.

AT&T joins with the Attorney General in urging that the Commission make it clear that its new rules do not apply to Automatic Dialing-Announcing Devices. AT&T disagrees with the American Teleservices Association on the need for hearings. Since the OIR proposes that a proposed decision will be on the Commission's agenda for June 6, 2002, AT&T states there simply is not enough time to conduct hearings and to meet the July 1 deadline for adoption of the new rules.