Public Knowledge Asks Who Will Pay for Robocall Rules

When Chairman Pai announced Wednesday the item was on its way, the news was met with many questions (see 1905150041). Pai proposed to permit carriers to block unwanted calls to their customers “by default” and give consumers the ability to block callers not on their contact list. A Further NPRM would seek to create a safe harbor for providers who block calls for which caller ID authentication fails and seek comment on extending the safe harbor to the blocking of calls that are unsigned.

“The big question here is who pays for this, and how much?” PK Senior Vice President Harold Feld said. “This is particularly important on an opt-out plan, given that the Commission has given the carriers enormous discretion in how to contact customers and the general difficulties customers have in figuring out their bills. Given that customers will also have no idea how effective this will be, there need to be some safeguards.”

“We strongly disagree with this unfounded criticism,” an FCC spokesperson emailed in response to PK. “Call blocking services provided by default will be more efficient and less costly for carriers for a variety of reasons. Indeed, moving to a system of call blocking by default will make it far more likely that consumers will not be charged for these services.”

On the key issue of who would pay, the draft notes that the cost of dealing with a single consumer annoyed by illegal robocalls can be more than $10 per call and that as a voluntary program, no costs are being imposed on providers. “We would expect most if not all voice service providers to offer an opt-out service for free, as many already do,” the FCC says.

Margot Saunders, senior counsel to the National Consumer Law Center, had a more positive take than PK. “I have nothing negative to say about this,” Saunders told us. “It’s clearly a step forward. It can only help consumers. There’s obviously a lot of details to be worked out. How do you frame the white list? Who’s in charge of the program? How to deal with emergency calls, how to deal with costs.” Her question for the FCC: “What took them so long.”

The draft deals with what Saunders sees as a critical issue -- that many unwanted robocalls aren’t illegal. “Over 30 percent of the calls reported by Hiya are classified as ‘general spam’ and not fraud or other illegal activity, and approximately 20 percent are ‘telemarketing,’” the draft says: “More than half of the top 20 spam callers identified by YouMail are categorized as debt collection callers.” That’s important since the FCC is also under pressure from companies that make robocalls to protect them from lawsuits under the Telephone Consumer Protection Act, Saunders said. “My big concern is what are the callers going to say and will the FCC be able to withstand the anticipated objections from debt collectors and tech marketers,” Saunders said.

Safe Harbor

“Elements of the safe harbor resemble what we saw in the Senate” Telephone Robocall Abuse Criminal Enforcement and Deterrence (Traced) Act, said Mark Brennan of Hogan Lovells. “There are very good reasons to ensure that carriers have a reasonable safe harbor for blocking scam and fraud calls,” he said. “It’s also important to make sure that the blocking process works and, if there are hiccups, legitimate callers can have their calls unblocked promptly.”

The FCC recognizes the real problem is “bad actors, scam artists, operating outside the law and not businesses attempting to legitimately reach their customers,” said Scott Goldsmith of Dorsey & Whitney: The proposed solution is narrowly tailored to target scam robocallers and helps consumers. The challenge is “whether carriers will uniformly adopt the default call blocking options and, if they do, what exactly will be blocked?” Goldsmith told us. Providers may be reluctant to block calls based on a “mysterious, and possibly flawed, algorithm,” he said. The proposed safe harbor may not go far enough to allay industry concerns, Goldsmith said. “I expect service providers will be quick to chime in” in comments to FCC, he said.

“Unwanted wireline and wireless calls are such a problem for consumers that many tell us they have stopped answering their phones when they ring,” the draft says. Moving to a system where customers don’t have to opt-in will likely spur many carriers to provide better robocall protections, the draft asserts: “Inertia may be an obstacle for many consumers who might otherwise participate in a call-blocking program, and convincing consumers to affirmatively sign up for a call-blocking program (rather than offering it as the default) can be a costly endeavor, especially for smaller voice service providers.”

Some providers likely aren’t investing in call-blocking programs because of the low take rate, the draft ruling suggests. If a new type of robocall emerges, carriers now have to go back and seek permission to block a second time, it says. Requiring consumers to opt in and allowing customers to opt out “appears to have slowed the development of call-blocking programs,” the draft says. “We encourage voice service providers to make consumers aware of the programs’ availability and, for that limited subset of consumers who do not want to participate, make the opt-out process simple and easily accessible.”

Rigid Rules

The regulator sees no need for rigid rules.

Providers should be able to block calls based on “any reasonable analytics designed to identify unwanted calls.” The program would be based on “large bursts of calls in a short timeframe; low average call duration; low call completion ratios; invalid numbers placing a large volume of calls; common Caller ID Name values across voice service providers; a large volume of complaints related to a suspect line; sequential dialing patterns; neighbor spoofing patterns; patterns that indicate TCPA or other contract violations; correlation of network data with data from regulators, consumers, and other carriers; and comparison of dialed numbers to the National Do Not Call Registry."

The ruling also lays out a white-list program, under which consumers would specify phone numbers from which they wish to receive calls. “The evolution of technology has allowed the evolution of white-list programs,” the FCC says: “With the advent of smartphones, consumers regularly carry their contact lists in their pockets. And one deterrent for the white lists of old -- updating the white list as a consumer makes new contacts -- can now be automated.”

The safe harbor in the FNPRM proposes to protect carriers that use Secure Handling of Asserted Information Using Tokens (Shaken) and Secure Telephone Identity Revisited (Stir) technology to identify whether a call has been properly authenticated. “Voice service providers have emphasized the value of SHAKEN/STIR in addressing the illegal call problem,” the FNPRM says: “Many have asked us to provide a safe harbor for the blocking of calls that are likely to be illegal.”

On Thursday, Commissioner Mike O’Rielly called for the FCC to fix its TCPA rules (see 1905160088).