MIME-Version: 1.0 Content-Type: multipart/related; boundary="----=_NextPart_01C612A6.27DB9190" This document is a Single File Web Page, also known as a Web Archive file. If you are seeing this message, your browser or editor doesn't support Web Archive files. Please download a browser that supports Web Archive, such as Microsoft Internet Explorer. ------=_NextPart_01C612A6.27DB9190 Content-Location: file:///C:/222B4C8D/bw_needed_now_laws_to_can_spam.htm Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii" Needed Now: Laws to Can Spam - Business Week

ht= tp://www.businessweek.com/magazine/content/02_40/b3802104.htm





OCTOBER 7, 2002


By Mike France

C= ommentary: Needed Now: Laws to Can Spam

If the junk e-mail in your in-box is piling higher, join the crowd. Over the p= ast year, the volume of "spam" has more than tripled. The number of unsolicited electronic come-ons intercepted in August by Brightmail Inc., a= San Francisco outfit that helps Microsoft, Cisco Systems, and others block unwa= nted mass mailings, was a record-setting 5,065,858--up from just 1,504,043 in August, 2001. Spam now accounts for 38% of all e-mail traffic, up from 8% l= ast year, according to Brightmail. "In the last 12 months, it has gone from something that I could manage manually by deleting e-mails into something that's out of control," says David J. Farber, former chief technologis= t at the Federal Communications Commission.

Like many other computer cognoscenti, Farber counterattacks with a software filter designed to stop spam. But it takes a lot of time to decide what to screen out. And cleverly disguised sex ads still break into his computer, w= hile some legitimate messages are bounced away. As a result, Farber doubts filte= rs can ever be a complete solution to the spam plague--a verdict increasingly shared by other technology experts.

That's why it's time for a legal assault. Already, more than two dozen stat= es have passed measures against garbage mail. California, Colorado, and five o= ther states, for instance, now require mass e-mailers to label advertising missi= ves "ADV:" in the header line, which makes them much easier to block = with filters. But state statutes are unenforceable against nonresidents and vary from jurisdiction to jurisdiction. One unified federal rule, such as the Telephone Consumer Protection Act of 1991, which banned unsolicited faxes, needs to be passed in Washington and then evangelized in other countries. If not, spam will continue to eat up time, decrease productivity, tax computer capacity--and ultimately weaken one of the most powerful communications too= ls in history.

Yet federal legislation won't come easily. As reviled as spam is, the idea = of regulating it is surprisingly controversial. Left- and right-wing libertari= ans alike are skeptical of any laws that impede commercial free speech. Noting = that many ads have political overtones--for example, promotions for abortion clinics, gun fairs, or medical marijuana--they argue that any restrictions = on spam could muzzle socially valuable information. "Once the government starts deciding which speech is valid and which isn't, then you are in a dangerous area," says David G. Post, an Internet-law expert at Temple University. "That's exactly what the First Amendment is about."
What's more, many companies in consumer industries with high marketing cost= s, such as retail, travel, and insurance, are worried that lawmakers will prev= ent them from using a powerful ad tool. Amazon.com, the Securities Industry Ass= n., the Direct Marketing Assn., and others have all lobbied against--and thus f= ar blocked --any federal spam laws. They argue that bulk e-mail gives consumers more choice and lower prices while helping small companies take on big ones. "It is a cheap way to advertise, so the savings can be passed on to the consumer," says Joe Rubin, director of congressional affairs for the U= .S. Chamber of Commerce.

Some of these are seductive arguments. But ultimately, they are outweighed = by the utter pointlessness of most spam. Response rates to bulk commercial e-m= ail are thought to be as low as .005%. That means the typical message appeals t= o 50 people and annoys 999,950. All the highbrow defenses of spam start sounding overblown when you consider the sordid reality of the stuff itself--unwanted pyramid schemes, anti-aging gimmicks, and live shower-cam promos. The cacop= hony drowns out any valuable messages, in any event.

It might seem as if the minuscule response rates would doom spammers to failure. Quite the contrary. E-mail is so cheap that they can make money ev= en with almost no click-through. Marketers now pay $150 for a compact disk wit= h 70 million e-mail addresses--or 3,500 new customers. Not a bad deal.

And here's the really troubling development: the economics of spam are only getting worse from a public standpoint. Thanks to aggressive new techniques= for harvesting e-mail accounts, the cost of hooking new customers is constantly plummeting. For example, some programs automatically raid public message bo= ards looking for addresses. Others bombard Internet service providers with random name combinations (asmith@businessweek.com, bsmith@businessweek.com, csmith@businessweek.com) until they hit pay dirt. Such tools are a key reas= on the volume of spam has exploded in recent months.

This development means one simple thing: that private solutions to curbing = spam won't work. This is a classic case of free-market failure. Consumers can ig= nore junk e-mail to their hearts' content, but no amount of rejection will ever = make mass e-mailing unprofitable. Only the government can change the cost-benefit analysis enough to make a difference.

How so? First of all, by following California's lead and enacting federal legislation requiring unsolicited bulk e-mail messages to include "ADV:" in the headers. That would turn filters into a far more effective tool while respecting the rights of spammers and consumers who wa= nt to receive their offers. Just as is the case with junk faxes, anybody who violated the law would be subject to an automatic fine of, say, $25.

Better yet, the government could offer consumers a choice. People who don't want junk e-mail could sign up for a national database of prohibited addres= ses. Spammers that ignored the list would, again, be forced to pay a penalty. Similar programs have been established privately by the Direct Marketing As= sn. to help people avoid telemarketing.

Despite the protests of First Amendment absolutists, both of these measures would probably be constitutional. Commercial free speech is protected, but = it is not immune from regulation. So long as they have good cause, lawmakers a= re allowed to place reasonable restrictions on the conduct of commercial speak= ers. University of Southern California constitutional law professor Erwin Chemerinsky believes that a national "ADV:" law or opt-out list w= ould be upheld. "Giving recipients a choice is different than banning spam," says Chemerinsky.

Of course, these steps would not kill junk e-mail. Offshore e-mailers, including many of the Net's most notorious scam artists and pornography merchants, could still invade U.S. in-boxes at will. Indeed, this loophole = is often cited as an argument why spam shouldn't be regulated at all. But the problem is exaggerated. Well over half of all bulk commercial e-mail, inclu= ding most of the offers for legitimate products and services, originates domestically, according to Brightmail CEO Enrique Salem.

Although it isn't easy to do so, senders can be tracked down and prosecuted= --a prospect that, by itself, would frighten many spammers into compliance. Loo= k at the junk fax law, which has all but eliminated that once-widespread problem= .

Nobody wants politicians mucking around with the Internet. But sometimes they're needed. And, as every morning's spam barrage attests, this is one of those times.

Read a Letter to the Editor about this story.

Legal Affairs Editor France isn't looking for diet pills, psyc= hic advice, or a new mortgage.

Copyright 2000-20= 03, by The McGraw-Hill Companies Inc. All rights reserved.
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