The Economics of Spam

Written by Sam Vaknin

Tennessee resident K. C. "Khan" Smith owesrepparttar internet service provider EarthLink $24 million. According torepparttar 105894 CNN, last August he was slapped with a lawsuit accusing him of violating federal and state Racketeering Influenced and Corrupt Organizations (RICO) statutes,repparttar 105895 federal Computer Fraud and Abuse Act of 1984,repparttar 105896 federal Electronic Communications Privacy Act of 1986 and numerous other state laws. On July 19 - having failed to appear in court -repparttar 105897 judge ruled against him. Mr. Smith is a spammer.

Brightmail, a vendor of e-mail filters and anti-spam applications warned that close to 5 million spam "attacks" or "bursts" occurred last month and that spam has mushroomed 450 percent since June last year. PC World concurs. Between one seventh and one half of all e-mail messages are spam - unsolicited and intrusive commercial ads, mostly concerned with sex, scams, get rich quick schemes, financial services and products, and health articles of dubious provenance. The messages are sent from spoofed or fake e-mail addresses. Some spammers hack into unsecured servers - mainly in China and Korea - to relay their missives anonymously.

Spam is an industry. Mass e-mailers maintain lists of e-mail addresses, often "harvested" by spamware bots - specialized computer applications - from Web sites. These lists are rented out or sold to marketers who use bulk mail services. They come cheap - c. $100 for 10 million addresses. Bulk mailers provide servers and bandwidth, charging c. $300 per million messages sent.

As spam recipients become more inured, ISP's less tolerant, and both more litigious - spammers multiply their efforts in order to maintainrepparttar 105898 same response rate. Spam works. It is not universally unwanted - which makes it tricky to outlaw. It elicits between 0.1 and 1 percent in positive follow ups, depending onrepparttar 105899 message. Many messages now include HTML, JavaScript, and ActiveX coding and thus resemble viruses.

Jupiter Media Matrix predicted last year thatrepparttar 105900 number of spam messages annually received by a typical Internet user is bound to double to 1400 and spending on legitimate e-mail marketing will reach $9.4 billion by 2006 - compared to $1 billion in 2001. Forrester Research pegsrepparttar 105901 number at $4.8 billion next year.

More than 2.3 billion spam messages are sent daily. eMarketer putsrepparttar 105902 figures a lot lower at 76 billion messages this year. By 2006, daily spam output will soar to c. 15 billion missives, says Radicati Group. Jupiter projects a more modest 268 billion annual messages by 2005. An average communication costsrepparttar 105903 spammer 0.00032 cents.

PC World quotesrepparttar 105904 European Union as peggingrepparttar 105905 bandwidth costs of spam worldwide at $8-10 billion annually. Other damages include server crashes, time spent purging unwanted messages, lower productivity, aggravation, and increased cost of Internet access.

Inevitably,repparttar 105906 spam industry gave rise to an anti-spam industry. According to a Radicati Group report titled "Anti-virus, anti-spam, and content filtering market trends 2002-2006", anti-spam revenues are projected to exceed $88 million this year - and more than double by 2006. List blockers, report and complaint generators, advocacy groups, registers of known spammers, and spam filters all proliferate. The Wall Street Journal reported in its June 25 issue about a resurgence of anti-spam startups financed by eager venture capital.

ISP's are bent on preventing abuse - reported by victims - by expungingrepparttar 105907 accounts of spammers. Butrepparttar 105908 latter simply switch ISP's or sign on with free services like Hotmail and Yahoo! Barriers to entry are getting lower byrepparttar 105909 day asrepparttar 105910 costs of hardware, software, and communications plummet.

The use of e-mail and broadband connections byrepparttar 105911 general population is spreading. Hundreds of thousands of technologically-savvy operators have joinedrepparttar 105912 market inrepparttar 105913 last two years, asrepparttar 105914 dotcom bubble burst. Still, Steve Linford ofrepparttar 105915 UK-based insists that most spam emanates from c. 80 large operators.

Now, according to Jupiter Media, ISP's and portals are poised to begin to charge advertisers in a tier-based system, replete with premium services. Writing back in 1998, Bill Gates described a solution also espoused by Esther Dyson, chair ofrepparttar 105916 Electronic Frontier Foundation:

"As I first described in my book 'The Road Ahead' in 1995, I expect that eventually you'll be paid to read unsolicited e-mail. You'll tell your e-mail program to discard all unsolicited messages that don't offer an amount of money that you'll choose. If you open a paid message and discover it's from a long-lost friend or somebody else who has a legitimate reason to contact you, you'll be able to cancelrepparttar 105917 payment. Otherwise, you'll be paid for your time."

Subscribers may not be appreciative ofrepparttar 105918 joint ventures between gatekeepers and inbox clutterers. Moreover, dominant ISP's, such as AT&T and PSINet have recurrently been accused of knowingly collaborating with spammers. ISP's rely onrepparttar 105919 data traffic that spam generates for their revenues in an ever-harsher business environment.

The Financial Times and others described how WorldCom refuses to banrepparttar 105920 sale of spamware over its network, claiming that it does not regulate content. When "pink" (the color of canned spam) contracts came to light,repparttar 105921 implicated ISP's blamerepparttar 105922 whole affair on rogue employees.

PC World begs to differ:

"Ronnie Scelson, a self-described spammer who signed such a contract with PSInet, (says) that backbone providers are more than happy to do business with bulk e-mailers. 'I've signed up withrepparttar 105923 biggest 50 carriers two or three times', says Scelson ... The Louisiana-based spammer claims to send 84 million commercial e-mail messages a day over his three 45-megabit-per-second DS3 circuits. 'If you were getting $40,000 a month for each circuit', Scelson asks, 'would you want to shut me down?'"

Fighting Fire With Fire Won't Douse The Fire

Written by Stephen Brennan

Inrepparttar last few weeks, I have noticed an increase in tools or methods devised exclusively to fightrepparttar 105893 Spam fight. I applaudrepparttar 105894 originators ideals and their ingenuity, but I must voice my concern aboutrepparttar 105895 way in which such concepts can often backfire, sometimes inrepparttar 105896 nastiest of ways.

I abhor spam. I hate it with a vengeance and would do ALMOST anything to ridrepparttar 105897 Internet of it entirely. The worldwide financial consequences alone run into billions of dollars annually.It is comparable torepparttar 105898 disruption thatrepparttar 105899 propagation of viruses causes and is responsible for creating a completely independent niche market forrepparttar 105900 sale of tools and software programs designed simply to combat it. Although, I would imagine that even those engaged in this area of marketing would also welcome it's demise, however unlikely it might seem atrepparttar 105901 moment.

The latest is a web page that we are all being asked to link to which, as I understand it, will result inrepparttar 105902 email addresses listed on that page, which are 'known' spam originating addresses, being inundated with so much spam, generated by their own 'spiders' (entities which crawlrepparttar 105903 Net looking for email addresses) that their data will be effectively useless due torepparttar 105904 spider being effectively sent on an endless 'loop'. A simple but brilliant little idea - But is it safe?

What if an innocent email address should find it's way onto that web page? What if one is maliciously placed there? Does that email address get caught up inrepparttar 105905 vicious circle of unsolicited email? Maybe not, but even ifrepparttar 105906 method precludes this particular 'backfire', more torepparttar 105907 point, is it right to spamrepparttar 105908 'spammer'? If you rob a thief, doesn't that make YOU a thief too, regardless?

The fact remains also, there hasn't been a means of stopping spammers that has worked yet. Will they be somehow able to turn this idea around and use it againstrepparttar 105909 Internet population?

I can understandrepparttar 105910 anger, frustration andrepparttar 105911 sometimes, sheer desperation that some may feel after having been an especially badly 'bashed' spam victim, but doesn't this type of 'payback' solution smack of 'Internet vigilantism' or 'takingrepparttar 105912 law into one's own hands' (something that is wrong and dangerous, no matter how justified and tempting it may seem to be)?

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