About a month ago word came down from the Federal Election Committee that popular text-2-donate campaigns could be used for Federal and State elections - a potential fund-raising gamechanger for the 2012 Presidential & Congressional races. The FEC decision seemed to some of us at Ez Texting as coming out of nowhere - and it turns out that was the case for the carriers too. Why? Text-2-Donate seems simple to consumers. You text a keyword to a short code and 5 or 10 dollars are added to your phone bill. In reality, there's a lot of stuff going on behind the scenes. When you add in Federal election laws, well, it gets a lot more complicated:
But the wireless carriers who would oversee the donations-by-text service - including the four U.S. giants Sprint Nextel Corp, Verizon Wireless, AT&T Inc. and T-Mobile USA - have yet to get on board with the plan.
The carriers - who account for about 90 percent of the more than 330 million wireless subscriptions in the United States - are worried about an array of liability and regulatory issues they could face in handling contributions to presidential and congressional candidates.
The carriers are asking the FEC for more guidance on how they should implement a donations-by-text program, according to four industry sources.
One sticking point is that the carriers want to make sure they will not be held liable for determining donors' eligibility to contribute to a campaign, industry sources said.
But wait, there's even more:
Text donations, capped at $10 per text and $50 a month, according to the FEC ruling, would allow givers to remain anonymous, although campaigns would have access to the donors' phone numbers. Donations by text messages also would be limited to a total of $200 per phone number to avoid triggering a federal requirement for disclosure of that donor's identity and address.
Donating to political campaigns by text would be similar to giving to charity: A donor would send a message to a text code and then confirm his or her intention and eligibility. But in this case, carriers and aggregators processing the payment would take a significant cut from each transaction as they do with other non-charitable transactions, such as purchases of ring tones.
That cut appears to be part of the reason for tension that carriers are feeling over text donations to campaigns. The fee could reach 30 percent to 50 percent of each donation, according to FEC documents, putting wireless carriers in a potentially uncomfortable position of doing business with campaigns and their fundraising efforts.
Discounts on fees for a political campaign risk qualifying as an in-kind donation to the campaign from the wireless carrier, analysts said, a scenario that carriers want to avoid.
Head over to Reuters for the full exclusive. However this plays out, fundraising in 2012 with Super PACs, the Internet (social too!), and possibly text-2-donate will certainly make for unique races.