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Financial, health care groups brace for impact from FCC's robocall ruling

Washington's war on robocalls is escalating, and some industry groups worry their legal calls to consumers will get caught in the crossfire.

The U.S. Federal Communications Commission recently clarified its rules to give U.S. phone carriers the power to block robocalls by default. The new ruling goes further than previous agency actions by stipulating that voice service providers can use reasonable call analytics technology to block not just illegal scam calls, but unwanted calls as well. The blocking service also can be offered by default rather than on an opt-in basis.

Trade groups representing hospitals, banks and other businesses worry that the technology could erroneously block legal, wanted calls, such as health care reminders, product safety recalls, data breach and fraud alerts, and other time-sensitive notifications.

"We're going to have to figure out how to adapt, but I think we're also going to have to work with the FCC," on ways to implement the rules and address potential unintended consequences, said Paul Miller, CEO of the Washington lobbying firm Miller/Wenhold Capitol Strategies. Miller's firm represents hospitals and other healthcare providers that belong to the American Association of Healthcare Administrative Management.

Consumer Bankers Association President and CEO Richard Hunt similarly said in a statement that his group is working with the FCC on the ruling's implementation, but its members fear the ruling could lead to the erroneous blocking of urgent calls related to credit card fraud or low account balances.

The American Association of Healthcare Administrative Management and the Consumer Bankers Association were part of a coalition of industry groups that sent a May 31 letter to the FCC raising concerns about the ruling ahead of the commission's June 6 vote to implement the rule revisions.

According to the FCC's order, published June 7, a "reasonable" call-blocking program from a voice service provider would include a way for legitimate callers to report instances of erroneous blocking and to resolve complaints.

FCC Chairman Ajit Pai cited this stipulation ahead of the agency's vote, saying he believed industry groups' concerns about overly aggressive blocking had been "appropriately addressed." Pai has identified fighting illegal robocalls as the FCC's top consumer protection priority since 2017.

According to YouMail, a robocall blocking software developer whose data is often cited by the commission, the number of robocalls in the U.S. rose to 47.84 billion in 2018, up from 30.51 billion in 2017.

As of June 10, 24.96 billion robocalls have been placed nationwide in 2019, equaling about 76.0 calls per person affected.

"Everybody supports the commission's efforts in full to address those illegal calls," said Mark Brennan, a partner at the Washington law firm Hogan Lovells US LLP who focuses on communications and privacy issues. "But there's a lot of concern that this [robocall ruling] was overbroad by proposing call blocking to this undefined category of unwanted calls."

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Under the FCC's ruling, firms that believe their calls have been unfairly blocked may seek review of a particular call-blocking program by filing a petition for declaratory ruling with the commission.

Virginia O'Neill, executive vice president of regulatory compliance and policy at the American Bankers Association, said in a statement that she would like the FCC's rules to include a mechanism for informing consumers when the phone carriers determine that legal, wanted calls were erroneously blocked. Such notifications should go out "in the most timely and efficient manner possible" so that consumers are aware that they may have missed important information, she said.

Hogan Lovells partner Brennan noted that what comprises an unwanted call could differ from person to person or carrier to carrier, creating challenges for implementation. Some of the technologies used to block calls also have inherent flaws, he said, noting that flight delay notifications or safety recalls could be incorrectly flagged by technology designed to filter out messages from a single caller that issues a large number of calls in a short period of time, for instance.

"That's why the commission really should focus on addressing the real problem — the illegal scam and fraud calls," Brennan said.