We all get junk mail at home and at the office. It is an accepted
fact of life--at least in the United States. So why is unsolicited
commercial e-mail--also known as spam or junk e-mail--a problem?
To understand the problem of spam, it helps to know what much
of today's spam advertises. There are many places on the Internet
where copies of spam are reposted by both recipients and system
administrators in order to help notify the Internet community
about the latest sources of spam. Surveying Usenet newsgroups
in the news.admin.net-abuse.* hierarchy, you can quickly see that
there are very few reputable marketers using spam to advertise
goods and services. To the contrary, the most commonly seen spams
advertise pyramid schemes, get-rich-quick and make-money-fast
scams, phone-sex lines, and pornographic Web sites. Yet most surprisingly,
vast quantities of spam advertise services or software kits so
you can become a spammer yourself.
There are six reasons unsolicited commercial e-mail is such a
problem:
Cost shifting. Sending bulk e-mail is amazingly cheap. With just a modem and
a computer, spammers can send hundreds or thousands of messages
per hour, and though that relatively minuscule cost of entry into
the market is a potential advertiser's dream, it quickly becomes
a nightmare for those who pay the costs of receiving it. The costs
can range from the long-distance charges or per-minute access
charges for dialing into an Internet service provider (ISP) to
the cost of connectivity and disk storage space at the ISP and
the inevitable administrative costs when the incoming flood outstrips
capacity, resulting in system outages. These costs can be quite
substantial: one major U.S.-based ISP estimates that spam costs
it more than $1 million per month, accounting for nearly $3 per
user per month. It is much harder, however, to calculate the cost
of opportunities lost because of system outages, delayed services,
and overflowing mailboxes.
The cost implications from spam are compounded by the fact that
ISPs purchase bandwidth--their connection to the rest of the Internet--based
on projected usage by their prospective user base. For most small
to midsize ISPs, bandwidth costs are among one of the greatest
portions of their budget and contribute to the reason many ISPs
operate on very slim margins. Without junk e-mail, increased consumption
of bandwidth would normally track with increased numbers of customers.
However, when an outside entity like a spammer consumes that bandwidth,
the ISP has few choices: let paying customers cope with slower
Internet access, absorb the costs of increasing capacity, or raise
rates. Whatever the choice, we all wind up bearing costs that
the advertiser has avoided.
The online world is no different from the offline world in the
many ways that time equals money. For service providers, time
constitutes many different things besides the hourly rate that
many people still are charged. An ISP's time also means the speed
at which its systems can process the load placed on its servers.
CPU time is a precious commodity, and processor performance is
a critical issue for ISPs. When the central processing units of
a mail server are tied up processing spam, it creates a drag on
all of the mail in that queue--wanted and unwanted alike.
These costs are why the junk e-mailer's cry of, Just hit the delete
key! falls on unsympathetic ears. If the costs were as minimal
as the energy expended in pressing one button, spam would not
be a concern. However, when one push of a button can unleash a
million e-mails, the costs multiply rapidly and are felt at the
many different places where costs are incurred throughout the
process of transmitting and delivering e-mail.
Fraud. In survey after survey, the overwhelming majority of Internet
users dislike receiving spam. In response to such strong consumer
opinion, many ISPs have taken a variety of costly steps to reduce
the volume of spam transmitted through their systems, including
the buildup of extra capacity to accommodate the demands of filtering
and storing what represents, according to America Online, nearly
30 percent of its daily mail traffic. Knowing that ISPs have taken
those measures, senders of junk e-mail use tricks to disguise
the origin of their messages. One of the most common is to relay
their messages off the mail server of a third party. This tactic
doubles the damages, because now both the receiving system and
the innocent relay system are flooded with junk e-mail. For mail
that gets through, many times the flood of complaints goes back
to the innocent site because that site was made to look like the
origin of the spam. Another common trick is to forge the headers
of messages, making it appear as though the message originated
elsewhere and again providing a convenient target upon which the
anger of recipients and the flood of complaints will land.
Theft. The sending of spam results in one party's imposing costs on
another, against the party's will and without permission. Some
have called unsolicited e-mail a form of postage-due marketing.
Others, quite correctly, call it a form of theft. Although some
defend unsolicited commercial e-mail as just another form of free
speech, those who bear the costs of someone else's speech are
left to ask what part is "free."
Harm to the marketplace. When a spammer sends an e-mail message to a million people,
it is carried by numerous other systems en route to its destinations,
once again shifting cost away from the originator. The carriers
in between suddenly are bearing the burden of carrying advertisements
for the spammer. The number of unsolicited messages sent out each
day is truly remarkable. Spam-filtering company Bright Light Technologies
claims its research shows more than 25 million unsolicited messages
are sent every day. Numerous court cases are under way between
spammers and the innocent victims who have been subjected to such
floods. Unfortunately, whereas major corporations can afford to
fight these cutting-edge cyberlaw battles, small mom-and-pop ISPs
and their customers are left to suffer the floods.
The harm inflicted is in many respects analogous to the effects
on society from something like pollution. For example, it would
be far cheaper for chemical manufacturers to dump their waste
into rivers and lakes. However, those externalities--as economists
call them--allow one party to profit at another's--or everyone's--expense.
Nobel laureate Ronald Coase hypothesized that it is especially
dangerous for the free market when an inefficient business--one
that cannot bear the costs of its own activities--distributes
those costs to the population at large. What makes such a situation
so dangerous is that when millions of people each suffer only
a small amount of damage, it often is more costly for each individual
victim to recover the small portion of the harm allocable to them.
Thus, the larger population will continue to bear those unnecessary
and detrimental costs until their individual damage becomes so
great that those costs outweigh the transaction costs of uniting
and fighting back. And the spammers are counting on that: they
hope that if they steal only a tiny bit from each of millions
of people, very few people will bother to fight back.
Consumer perception. E-mail is increasingly becoming a critical business tool. Yet
despite the best efforts of service providers, for many people
the accessing of e-mail still represents a bit of a struggle.
Many of the major online services remain difficult to access at
peak traffic times, and network congestion can make it an arduous
task to simply download your e-mail. Once you've fought your way
online and waited many minutes to retrieve your mail, what do
you see? An array of pornographic Web site ads, a few chain letters,
and a hot stock tip from a self-styled securities analyst who
can't spell.
The annoyance and frustration caused by such situations cannot
be underestimated. Internet users have deserted many public discussion
forums for fear that their e-mail addresses will be harvested
and added to junk mail lists. Customers are afraid to give their
addresses out in even legitimate commerce for fear of being added
to and traded among thousands of mailing lists. Legitimate businesses
are afraid to use e-mail to communicate with their existing customers
for fear of being branded Net abusers. Such distrust threatens
to undermine the acceptance and growth of electronic commerce
among the legions of new Internet users taking their first steps
online.
Electronic mail is a marvel of accessibility and ease of use for
tens of millions of Americans and is a critical growth component
of the world's young Internet economies. Yet in just a few short
years, unsolicited advertisements sent by e-mail have already
begun to strangle Internet commerce in its crib. Unless real solutions
are found to protect and preserve the viability of the medium,
today's crop of scammers and thieves soon will give way to more
legitimate marketers who will replace the flood of offensive and
fraudulent messages with even greater quantities of ads for snack
chips and laundry powder. When that terrible day comes, our electronic
mailboxes will cease to be a useful tool for business and personal
communications and we will have squandered one of the most powerful
tools of communication this planet has ever known.
Global implications. Like the fax machine before it, electronic mail is a marvelous
tool of business and personal communication. It's simple, it's
accessible, and it's becoming more and more an indispensable part
of our professional lives. But there are even more far-reaching
potentials of e-mail that may be lost if the medium's functionality
and utility get destroyed by the proliferation of junk e-mail.
The Internet is an incredible tool for spreading information critical
to the development of freedom and democracy around the world.
For instance, e-mail is often cited as a vital tool for communicating
with and between Chinese democracy activists, and media stories
have even credited e-mail as a critical tool in the overthrow
of the Suharto regime in Indonesia. Unless a way is found to protect
e-mail from the excesses of unscrupulous marketers, the damage
they wreak has profound implications for the growth of free speech
and democracy around the world.
Ultimately, the problems caused by spam on the Internet--and the
solutions applied--will fundamentally shape the ways individuals
and businesses use the medium. A myriad of technological, legislative,
regulatory, and societal measures have been suggested for curbing
the damage caused. However, no matter what solution or combination
of solutions is proved to be most effective, a solution must be
found because no less than the future of the Internet may be at
stake.
Ray Everett-Church is an attorney with the Arlington, Virginia,
law firm of Haley Bader & Potts (www.haleybp.com) and is counsel to the Coalition against Unsolicited Commercial
E-Mail (www.cauce.org).
Spam Law Update
Ask nearly any Internet service provider (ISP) and they'll tell
you their customers' single greatest complaint is spam. To fight
the flood, many service providers have tried a variety of technological
blocks and filters--with varying degrees of success--but for many,
technology alone has not been enough and so they have turned to
the law.
Numerous service providers in the United States have successfully
sued spammers, arguing that unsolicited e-mail is a form of trespass
to the private property of the company. For most ISPs, however,
the cost of litigating such a suit is prohibitive. As a result,
many longtime Internet users--a group traditionally wary of government
intrusion into technology issues--have found themselves in the
unfamiliar position of turning to legal rather than technical
solutions. Setting aside their distaste for government intervention,
coalitions of Internet businesses, consumers, and service providers
have begun lobbying their legislators for relief from the rising
costs of e-mail spam.
Both pro- and anti-spam bills were considered in 1998 by the U.S.
Congress, but intensive lobbying efforts by marketers, consumers,
and Internet service providers resulted in a stalemate. Although
spam remains on Congress's plate, three state legislatures--California,
Virginia, and Washington--each have passed measures to curb the
practice within their limited jurisdictions, and a dozen more
states have bills under consideration. Legislation to address
the problem of cost-shifted advertising is not new to the United
States: the rise of junk fax advertisements in the late 1980s
generated state and federal legislation that banned the practice.
As the United States grapples with spam legislation, grassroots
lobbying efforts in other countries are under way. European and
Australian affiliates of the U.S.-based Coalition against Unsolicited
Commercial E-Mail have been unveiled and are at work persuading
legislators to outlaw junk e-mail in those jurisdictions. In addition,
several European Web sites are allowing voters to sign online
petitions and to e-mail European Union (EU) decision makers about
a new proposal for the EU Liability Directive that would make
it easier for Internet users to defend against spam. Those efforts
clearly are having an effect: the British Department of Trade
and Industry has added spam to its list of issues to be addressed
in its Consultation Paper called Building Confidence in Electronic
Commerce.
Why Spam is a Problem
