Spam is infiltrating Chris Shivers’ business.
Shivers, who is systems administrator for Aristotle Inc., a small Internet service provider in Little Rock, AK, told a panel at the FTC Forum in Washington, D.C. that "spam costs me $5 per customer per year."
Shivers added, "Our average customer spends about $6 per month."
Out of 4 million messages, Aristotle has found that 2.5 million are spam.
His annual cost to pay for new technology and manpower to cope with spam? $112,000 a year. But "I’ll have to spend that again in the next six months," he added.
Worse, Shivers said he hears from more customers everyday are giving up on using e-mail altogether. "It’s become an overwhelming problem."
NortelNetworks, a global corporation, which manufactures Internet equipment and grapples with protecting its own employees from spam, has found that 70% to 80% of e-mail is spam. "We are seeing it double every four to six weeks," said Chris Lewis NortelNetworks’ security architect.
Lewis has compiled metrics on lost productivity. It cost about $1 per spam received, he said. When you add up the time it takes to download an e-mail message that turned out to be spam, purge it from the system, deal with messages that open many new windows that have to be closed, spam costs his company $1,000 to $5,000 a day.
And spam is increasing. "A big steep curve has happened in the last year," said Laura Betterly, president of Data Resource Consulting Inc.
"If it continues at this rate, it will be 80% of all e-mail," Betterly said. The cost per new customer to deal with spam issues will be $3 to $5.
The solution starts with marketers, Lewis insisted.
"We’ve had a number of issues with major marketers not taking care of the bounces on their lists," he charged.
The e-mail service providers on the panel leapt to their clients’ defense.
"There are a lot of functions that reputable businesses do to clean [their lists of] invalid as well as undeliverable addresses," said Steve Smith, CEO of MindShare Design.
"I’ve never been involved in a business that’s more accountable," said Al Diguido, CEO of Bigfoot Interactive.
No matter how sparkling the list hygiene, however, there’s no way for a marketer to know when an e-mail account has been abandoned.
This, too, is becoming an increasing problem, said Dale Malik, director of BellSouth Internet Group, a large ISP. "People abandon for six months and get 1,000 messages of 7 to 10 k each," Malik said. "I have to absorb the cost of maintaining those."
These costs don’t add up to a death knell for e-mail, the panelists insisted, saying that their businesses are growing and profitable.
But a solution is desperately needed.
Is the CAN-Spam Act, introduced in the Senate in April the solution?
"It’s a good first step," DiGuido said. "We believe there’s a commercial solution to this."
The fact that it supersedes the 26 state anti-spam bills is positive, said Malik.
But the bill needs to contain a stronger right of action for companies and e-mail senders against spammers, Shivers said.
"I’m not convinced it goes far enough," said Laura Atkins, president of SpamCon Foundation, a nonprofit group working to reduce unwanted e-mail and ensure that valid e-mail reaches its destination. "It’s similar to state laws and they haven’t really worked. Plus the [increased] cost of enforcement has to be dealt with."
"Anything that helps get rid of spam is good," said Lisa Pollock Mann, senior director of messaging at Yahoo. Among the provisions in the bill that Yahoo is in favor of are that it provides for users to opt-out, and that it gives ISPs a right to go after spammers in court.
