(Direct Newsline) Panelists at a congressional hearing about spam and small businesses argued that a do-not-spam list is a bad idea and that the the Can-Spam Act should be passed as soon as possible.
Rumors continue that Can-Spam, passed by the Senate 97-0 last week, will be put up for a full House vote by Speaker of the House J. Dennis Hastert (R-IL) within days. “It’s not if, it’s only a matter of when,” says an unnamed source on Capitol Hill.
The biggest benefit of Can-Spam’s passage? The preemption clause, John Rizzi, CEO of e-mail marketing company e-Dialog, told the Committee on Small Business on Thursday. “The single most important thing is to act—to approve the Can-Spam bill. Because of Can-Spam’s preemptive nature—it will make the state bills mostly go away,” he said, pounding his fist on a 10-pound binder containing the antispam laws of 37 states.
Rizzi added that there are probably tens of thousands of small businesses breaking the law because they don’t know the state anti-spam laws exist. At Suzi’s Dollhouses, where Rizzi buys doll furniture by e-mail for his daughter, “Suzi has no clue that every time she presses the ‘send’ button, she’s breaking the law,” he said.
Although Rizzi disagrees with including a do-not-e-mail (DNE) registry in the bill, he said he can deal with the registry language as it exists now, because it does not go so far as to mandate the creation of a DNE list. The do-not-e-mail language in Can-Spam calls for the Federal Trade Commission to study the efficacy of a registry and says the FTC “may establish and implement the plan, not earlier than nine months after the date of enactment of the Act.”
Rizzi told the committee chairman Donald Monzullo (R-IL) and other congressmen that compliance with a DNE list would be expensive and difficult to implement for small businesses. What’s more, he said, it won’t work.
“The do-not-e-mail list is a disaster waiting to happen,” Rizzi said in an interview following his testimony. “Someone is going to hack into it and get it, and it will be public in a number of hours.”
Pointing out that e-Dialog spends 6% of its budget on e-mail delivery issues for its clients now, Rizzi added, “Many small businesses have already built a significant and valuable asset in their permission-based lists. Will businesses need to reconfirm all their permissions to ensure compliance? If so, this could cause a list reduction of between 50% and 80%, leaving the business to essentially start over in building their list.”
Howard Beales, director of the FTC’s Bureau of Consumer Protection, testified that he thought a DNE list would be technically challenging to implement—a view he has expressed publicly in the past. But Beales added that the FTC favors legislation to enhance its ability to fight fraudulent spam.
“First, legislation must address how to find the person sending the spam messages,” Beakes said. “Second, legislation must deal with how to deter the person sending the spam messages. Finally, legislation must determine what standards will govern nondeceptive, unsolicited commercial e-mail.”
A do-not-e-mail registry would disproportionately affect small businesses, said Jerry Cerasale, senior vice president of government affairs of the Direct Marketing Association, who also testified. “DMA research shows that some 28% of small businesses do not have inhouse e-mail lists of customers,” Cerasale said. “This means that they are much more dependent than are large businesses on being able to e-mail in order to obtain customers, if they are able to grow their enterprises…Where sending prospecting letters via postal mail or hiring a sales force may cost thousands—even millions—of dollars, e-mail may be sent for a fraction of the cost—increasing competition and decreasing costs for consumers.”