The DMA has just been awarded a fresh five-year contract to manage the Telephone Preference Service. David Reed spoke to Mike Lordan about how TPS plans to maintain the relevance and impact of TPS as the world migrates into mobile.
If you were born before the 1980s, you probably still have a telephone landline. If so, then the odds are 2:3 that you have opted-out of receiving unsolicited telesales calls. If you are a Digital Native, however, you are likely only to have a mobile phone - and not to have registered to block cold calls.
That dichotomy is a reflection of how effectively the Telephone Preference Service has done its job for consumers since it was first established in 1999. With 17,196,000 phone numbers registered, it helps to stop unwanted sales calls to two-thirds of landlines. That level of registration has been helped by a number of significant events over the last decade, including the heavy rotation of calling by direct-selling kitchen fitters and the promotion of TPS as part of the BT Privacy campaign. Both led to spikes in uptake.
Getting the same level of consumer awareness that TPS is also available for mobile numbers is a critical task facing TPS, which earlier this year was appointed to a new five-year contract to manage the service by Ofcom. Raising visibility and registration rates ahead of any major activity that triggers consumer pushback is essential to protect the emerging mobile market as a channel for legitimate marketers.
“Numbers of mobile registrations haven’t grown that much and are below what you might expect,” says Mike Lordan, chief of operations at the DMA. “In part that is because not as many unsolicited calls are made to mobiles.”
He points out that the cost of calling consumers on mobile numbers is higher than on landlines, but is falling rapidly and could lead to a sharp rise in activity. Low cost ACDs and offshored call centres helped push up outbound calling rates in the early Noughties, resulting in more TPS registration.
“Companies also have less demographic information associated with mobile numbers. Brands have also realised that the mobile is a highly personal medium - they are more likely to upset people if they sell via the mobile than on a landline,” says Lordan. With younger people running their lives from one handset, TPS has an important function to play in protecting their rights and holding down volumes of unwanted calls.
This also underlines the twin roles the TPS has to play as the contract holder in facing both ways - providing an opt-out service for individuals and ensuring telemarketers actively screen against TPS. The better it gets at achieving that second goal, the fewer complaints consumers are likely to make.
“Our research shows TPS registration doesn’t stop all unwanted calls - it stops about half. People who are not registered get twice as many calls as those who are,” he says. Some of that residue of continuing calls to registered numbers is driven by offshored operations, although Lordan points out that if they are acting on behalf of UK-domiciled businesses, they are still required to screen against TPS.
UK companies are still actively calling numbers on the service’s file, however. It is almost certain that none of those doing so and triggering a consumer complaint as a result are DMA members. When it has been established that a member has breached the rules, the DMA has been swift to act - in February 2011, it suspended the data provider Phruit for failing to screen phone numbers it sold on against TPS. (The company was also found to have breached a number of other rules of the association.)
Lordan says this is proof of the effectiveness of the DMA and its fitness to operate the contract, but also points to a bigger and as yet unresolved challenge. “The level of complaints needs to be addressed because we are getting more,” he says. The TPS takes all complaints to the first level with the consumer, recording the details of the company and number responsible, where known, and referring them to Ofcom and the Information Commissioner.
This is where the process has been stalling, however. “In my view, there has not been the the level of enforcement or appetite to enforce. I have made representations to Ofcom and the ICO and am due to meet them again,” says Lordan. Guidelines to PECR which were laid before Parliament in January mean the Information Commissioner now has the power to fine up to £500,000 for serious breaches of the rules. Coverage of the new Guidelines tended to focus on how they might be applied to spam, but they are equally applicable to failure to screen phone numbers against TPS.
“We need to get more businesses screening and to see action taken against companies that are not screening. Not enough has been done in the past few years - there has been a distinct lack of enforcement,” he says.
Although TPS was created by statute, unlike the Mailing Preference Service, although both were originally set up as voluntary solutions to provide consumers with an opt-out. The DMA operated both since the outset and continues to be the only organisation to have operated TPS, although it faced a thorough competitive tender process before winning this time around.
As proof of the ability of self-regulation to tackle privacy issues, it is vital that adherence to the rules can be shown to be improving, especially at a time when European regulators are imposing more prescriptive rules. “We still have some work to do among consumers. We do an annual MORI survey which shows a 60 per cent recognition of TPS, so there is still more work to do, especially on recognition that you can register a mobile number,” says Lordan.
There are some operational issues that also need to be addressed and tidied up. BT and one of its rival network operators are allowed to register a telephone number on TPS on behalf of a subscriber. Some telemarketers suspect they have been doing this for all new customers as a way of removing them from competitive contact, since an alternative network will not be able to cold call with a telephony offer (and nor will any other category of company). BT does provide records of numbers that are terminated and not transferred to another network, although its competitors are less active in doing so.
Lordan notes that the TPS writes to every consumer when their number is registered so they are aware this has happened. But it does not screen TPS against deceased files because there could still be somebody resident at the same address using that number who does not wish to be called.
While working hard to ensure registration is easy for consumers and usage as high among outbound telesales operations as possible, there are some constraints on what can be achieved within its contract. “TPS was the first service of its type in the world. If you were starting over again, you might make one or two changes to help keep it up-to-date, such as requiring the consumer to re-register every five years,” he notes.
Equally, there is a commonly-held view that Corporate TPS is an unnecessary restriction on business which would not make it to the statute books if the law was being written now. But as Lordan accepts, there is no appetite to bring forward any amendments to the law in the current Parliament.
Instead, the focus is on meeting the needs of consumer and business while trying to get regulators to do their work more effectively. As Lordan recalls, “I was at an Office of Fair Trading meeting in 2011 where they said they need more legislation. I said you don’t, you just need to make use of what you already have.’