There’s a lot of confusion around AI, SMS, auto-dialers, and the new changes set to take effect on January 26th, 2025, under the TCPA (Telephone Consumer Protection Act). Here’s what you need to know:
Background: The FCC (Federal Communications Commission) has the authority to interpret the TCPA, and part of that interpretation now requires consumers to explicitly opt-in on a 1-to-1 basis for each company that wishes to contact them.
What Does This Mean?
The new rule mandates that consent must be obtained separately for each individual seller (e.g., company). In other words, a consumer must provide specific, written consent for each company that wishes to contact them. This change is aimed at closing the “lead generation loophole,” where broad consent forms previously allowed multiple companies to contact consumers without their clear understanding.
If you’re purchasing aggregated data, aged data, shared leads, or any other lead source and are using AI, SMS, or an ATDS (Automatic Telephone Dialing System) to contact consumers on their mobile devices, you’ll need explicit 1-to-1 written opt-in consent starting January 26, 2025.
ATDS / Dialer Concerns If you’re manually dialing leads and think you’re exempt from the ATDS rules, think again. Under the TCPA, an ATDS is defined as equipment that has the capacity:
- To store or produce telephone numbers to be called, using a random or sequential number generator; and
- To dial such numbers automatically.
The key here is “store or produce,” which doesn’t necessarily mean randomly generating numbers. Many modern dialers use some form of random or sequential number generation in their source code. Even if you’re manually dialing, if your system has this capability, it could be classified as an ATDS, making it subject to the TCPA.
Impact of the New Rule Starting January 26, 2025, any call made without explicit written 1-to-1 opt-in consent—regardless of when the lead was generated—will be illegal.
What is Written Consent?
Written consent means the consumer has provided a clear, signed agreement, specifically authorizing a particular company to contact them. For an example of compliant consent language, see this template.
Penalties for TCPA Violations
- Statutory Damages: $500 per violation. Each unsolicited call, text, or fax is a separate violation, which can add up quickly in large-scale operations.
- Treble Damages: If the court finds the violation was willful or knowing, damages can increase to $1,500 per violation.
- Class Action Lawsuits: TCPA violations often lead to class actions, with total damages potentially reaching millions of dollars.
- Injunctions: Courts can also issue injunctions to stop further violations, which could require you to change your business practices or halt certain communications entirely.
Does TCPA Apply to B2B?
Yes, the TCPA can apply to B2B communications, especially if you’re contacting cell phones. The law’s restrictions on telemarketing calls, autodialers, prerecorded messages, SMS, and artificial voices apply to calls made to residential lines and cell phones. Since many business owners use cell phones for business purposes, you must be diligent about scrubbing your contact lists against both the Do-Not-Call (DNC) list and cell phone databases to avoid unintentional TCPA violations.
Make sure you have written consent for any B2B communication that might involve a cell phone to stay compliant.
