New York, NY US - June 3, 1997 (ICB TOLL FREE NEWS) May 21, 1997's Washington Times told the story of The Association of National Advertisers, representing some 5,000 corporate members, lobbying Congress to no avail against the 888 auction. Daniel Jaffe, association exec vp, complained, . We don. t see anything wrong with paying a premium for vanity numbers, but a public auction will only artificially drive up prices beyond anything that. s reasonable..
With approximately $12 billion corporate dollars generated annually via toll-free numbers, you. d think Mr. Jaffe's constituents would have been an influential presence at the telco industry fora Industry Numbering Committee (INC) and SMS Number Administration Committee (SNAC) where the scenario leading up to the auction unfolded.
They weren't, depending instead on their carriers' assurances that their needs would be represented. Foolish indeed.
It is in these committees, open to all -- but attended only by telecom representatives -- that the characteristics, features and benefits of marketing and advertising tools such as 800 numbers, are designed in the guise of . industry standards.. Given the one-sidedness of the committees, and the commercial interests of their sponsors, it. s no surprise that the results are often anti-competitive against both service and end user subscribers.
The Toll Free Industry Guideline language, so heavily one-sided against user interests, has become the foundation for the new FCC Toll Free Ruling (see Cover Story, ICB Toll Free News, http://www.icbtollfree.com), and the wide path it lays to the Congressional auction door, now so vocally opposed by The Association of National Advertisers.
Here's how it happened.
1993 - Portability was enacted in May, transferring control of toll-free numbers from carriers to users. Carriers reacted to this loss by pronouncing these numbers a fragile resource which required their "protection" in the name of public interest. Concurrently, they promoted number . ownership. and number branding to major advertisers, all the while negating the same in industry forums and policy. Taking advantage of their exclusive access to the 800 database, they also filled their own 800 coffers to facilitate rolling out ever more proprietary products and services, creating an industry-induced shortage.
1995 - This industry-induced shortage of 800 numbers was further exacerbated by the industry. s band-aid introduction of 888 as a co-brand, rather than a separate domain, established at Industry Numbering Committee (INC) meetings, again open to all, but attended only by telco representatives.
(Co-branded, with both 800 and 888 being identified as toll-free area codes, your customers don. t know which code your toll-free number begins with! Are you 1 800 FLOWERS, 1 888 FLOWERS -- or both?! Confusion ensues, with lost business, misdial costs, and possible trademark infringements resulting. Yet the telco reps argued, successfully in their customers' absence, that their customers had no such concerns. So domain separation - maintaining the 800 brand for commercial use, and relegating utility toll-free functions such as paging to the lesser-known 888 and 877, etc., had no corporate advertiser support -- until it was too late.)
Late 1995- early . 96 (aka "too late. ) - The damage already done, advertisers and other users deluged the FCC with complaints that 888 would compromise both the utility and brand value of 800. The FCC responded by offering to . set-aside. those 888. s in question until . right of first refusal. could be studied. The FCC also responded by instituting micromanagement of the toll-free industry -- rationing out toll-free numbers, and requiring weekly reports of carrier activity - in a too-little too-late recognition of industry wrong-doing.
(The FCC 800 Ruling, however, illustrates that the FCC has no problem relying on industry anti-user propaganda to form its policies regulating subscribers. How odd. Or perhaps just convenient.)
Finally, all the tumult woke up Congress, which saw a new revenue stream in these numbers. The 888 auction was borne.
Unfortunately for advertisers, it. s specifically the 888 numbers in the FCC . set-aside. pool established to protect advertisers, that Congress wants to auction.
The essence of the Toll Free Ruling is that it further moves toll-free number control, granted by portability, away from users, beyond carriers and now on to the government.
With the FCC transferring much of anti-user voluntary industry guideline language into federal law, the carriers can no longer choose so readily, which "preferred" advertisers to protect, because the government now holds toll-free numbers hostage to it's own interests.
Corporate political alliance with carriers, relied upon for preferential treatment, has backfired, miserably.
The deadline for filing petitions for Reconsideration and/or Clarification to the FCC Ruling, was Tuesday, May 27th. As of this date, we are surprised to find no petitions filed by corporate marketers, although at least one filer (ICB) represents a number of corporate advertisers, and filed in their interests.
It would be wise for advertisers to get copies of the petitions, and file timely comments and responses, to place their weight and influence behind their interests.
Of course, whether or not the FCC will (or can) be receptive, is another matter.
Author/Correspondent's Profile: Judith Oppenheimer, Publisher, ICB Toll Free (800/888) News
New York, New York US - July 8, 1977 (ICB TOLL FREE NEWS) Should 1 888 FLOWERS be assigned to 1 800 FLOWERS? In this case it. s a fait accompli - the savvy folks at 800 FLOWERS took care of it themselves - but it. s a good question nonetheless, and the FCC wants your opinion.
Regulators want to know if you think right of first refusal - where the holder of a toll-free number would have first dibs on matching numbers in new toll-free exchanges - is a good idea or not, and why. They also want to know if you think there are better ways to distribute toll-free numbers, such as lottery or assignment by SIC code.
If these questions seem trivial, or the answers obvious, keep reading. First, though, accept for the moment two facts as gospel: one, that right of first refusal will not deplete, or accelerate any perceived depletion of, the toll-free resource; and two, that with or without right of first refusal, toll-free numbers are, and will remain, available for everyone who wants them.
Another new toll-free exchange, 877, is due out next April. Sans 800 FLOWERS. right of first refusal, a company that sells flower-designed wall paper, or flower-shaped cookies, might obtain 877 FLOWERS. Or the number could be haphazardly, numerically assigned to a local dry cleaner, a regional manufacturer, or other company or individual asking any carrier for a toll-free number.
Should it be? What. s the upside - and the down? Who benefits - who loses - who pays? How much?
American Express . owns. 1 800 THE CARD. Certainly VISA would like first dibs on 888 THE CARD, but it. s too close for trademark-comfort. However, AT&T, MCI, or some young upstart carrier might love it for their pre-paid calling card businesses. And 877 THE CARD could go to a sports trading card company.
Or, again, these numbers could be randomly assigned, even landing up on an automated voice mail box or fax machine.
What about 1 800 MATTRESS? Could a miscreant but savvy 877 MATTRESS navigate trademark loopholes, capture wrong number calls, and deliver inferior (or perhaps superior!) off-brand products?
For that matter, would a numeric 1 888 or 877 336-8478, intentionally or randomly assigned elsewhere, land 1 800 DENTIST in hot water with its dentist-affiliates, perhaps in exclusivity contract violation, or just disappointed with a diluted and less effectual 800 advertising product?
Are Toll-Free Numbers Comparable to Bank Account Numbers?
Without right of first refusal, the FCC will, in essence, direct the marketplace to treat toll-free numbers like bank account numbers - each digit for itself. Beyond the obvious Twilight-Zone-esque, giant step backwards this would represent for business communications in general, plus blatant conflict-of-interest and philosophical contradiction with its own toll-free auction interests, what would the tangible ramifications for advertisers, stockholders, and consumers be?
Assuming a reasonably high degree of consumer confusion, amply illustrated with current 888 numbers, could the cookie company crumble under the weight of misdial costs from tulip-seeking callers? Might gum-chewing baseball-card-traders tie up American Express phone lines, or frustrated credit card holders expire in voice-mail hell? Could the all-important 800 DENTIST ad budget liquidate into a litigation fund?
Or worse, will public faith in 800 get lost along with the daily onslaught of local area code changes? Would brand values of 800 number companies dive, taking stockholder confidence with them? Would carriers lose face, and traffic revenue, as toll-free service marketshare further erodes to the internet?
Don. t Buy, Don. t Tell.
What of the toll-free numbers inevitably purchased out of corporate necessity from existing arbitrary-number-assignees? In April . 97 the FCC outlawed toll-free number buying and selling, yet despite threat of penalties, confiscations and jail, we. ve observed no suspension of corporate need, or willingness to compensate current users in order to fulfill legitimate corporate communications agendas. Sans official replication - . right of first refusal. - we can only expect the need, and practice, to escalate.
We disagree with the prohibition to begin with -- there are no victims or losers in a free market distribution of toll-free numbers -- only winners, primarily consumers. Indeed, it. s text-book apple-pie business 101.
Nonetheless, for the time being the prohibition is law, and we question regulator-driven incentives to breach it. Of course, with prohibition-market status, perhaps the cost of vanity numbers will be driven so high, that only the mega and multinational can afford them to begin with.
Not surprisingly, these are some of the same issues raised in the debate over auctioning off toll-free numbers to the highest bidders. If that topic has caught your attention, take note.
Per the abbreviated Public Notice below, the FCC is seeking comment on toll-free vanity number issues.
While not officially related, this is particularly interesting in light of the Congressional 888 auction controversy. (Congress is considering auctioning off toll-free numbers to the highest bidders as part of its budget agenda - see recent NewsWeb articles, July 1, 1997, . U.S. COMPANIES ASK CANADIAN PARTNERS JOIN 888 AUCTION FIGHT. (http://www.bizwiz.com/cgi-bin/rbox/nwstory.pl?terms=97nw547204437) and June 3, 1997, . The Most Neglected $12 Billion Asset in Corporate America Today. (http://www.bizwiz.com/cgi-bin/rbox/nwstory.pl?terms=97nw519115354).
Confusing the matter is the fact that the first 888 numbers set-aside for "protection" pending the FCC's right of first refusal decision (see FCC Notice below), are the very same numbers now eyed by the government for auction, having been red-flagged by their 800-holders as "valuable." So company's that would normally lobby for protection, now may legitimately fear doing so.
Again exacerbating the need for creative "black-market" remedies.
Businesses would be well advised to review the background information on this issue as well as the contradictions and questions raised and as yet unanswered via Petitions for Reconsideration and/or Clarification, and Comments and Replies, in the recent FCC Order, The COMMISSION ESTABLISHES RULES PROMOTING EFFICIENT USE, FAIR DISTRIBUTION OF TOLL FREE NUMBERS. Report No: CC-97-17. by 2nd R&O & FNPRM. Action by: the Commission. Adopted: April 4, 1997. Dkt No.: CC-95-155. (FCC No. 97-123). Many of these documents can be found at, or linked from, ICB Toll Free News, http://www.icbtollfree.com.
FURTHER COMMENTS TOLL FREE SERVICE ACCESS CODES CC Docket No. 95-155
On October 4, 1995, the Commission adopted a Notice of Proposed Rulemaking (CC Docket No. 95-155) addressing various issues relating to toll free service access codes and, among other issues, requesting comment on the issue of vanity-number treatment in future toll free codes. Toll Free Service Access Codes, Notice of Proposed Rulemaking, 10 FCC Rcd 13692 (1995) (NPRM). The pleading cycle in response to the NPRM closed on November 15, 1995. In January 1996, the Common Carrier Bureau directed Database Management Services, Inc. to set aside 888 vanity numbers by placing them in "unavailable" status until the Commission resolves whether these numbers should be afforded any special right or protection. Toll Free Service Access Codes, Report and Order, 11 FCC Rcd 2496 (1996).
The record on the NPRM is almost two years old. At this point, the industry is preparing to deploy the next toll free code in 1998. We seek, therefore, to refresh the record in CC Docket No. 95-155 on issues associated with the treatment of vanity numbers, both with 888 as well as numbers in future toll free codes. Specifically, parties should comment on issues such as, but not limited to, a vanity-number lottery and Standard Industrial Classification Codes. We ask that parties confine their discussion to issues concerning vanity numbers and avoid simply reiterating their earlier pleading.
Comments and reply comments in response to this Notice should be no more than 20 pages, and must be filed on or before July 21, 1997, and reply comments must be filed on or before July 28, 1997... For further information, contact Robin Smolen (202 418-2353)of the Network Services Division, Common Carrier Bureau.
Author/Correspondent's Profile: Judith Oppenheimer, Publisher, ICB Toll Free (800/888) News