Exclusive: Utah, Michigan No-E-mail Registries Utter Failures

New figures released by Utah and Michigan indicate their so-called child-protection do-not-e-mail registries are complete failures as many e-mail marketers are apparently either unaware of them, ignoring them or working around them en masse.

Since it was implemented in November of 2005, Michigan’s registry has generated a measly $288,825 in revenue, according to Judy Palnau, a spokeswoman for the state agency administering it. Also, 219 companies have used the registry, she said.

Even worse, as of yesterday, Utah’s Division of Consumer Protection had collected $17,030 since last July from the state’s child no-email registry, and $20,414 during the previous 12 months, according to agency representative Tom Copeland.

Under Utah and Michigan’s child-no-e-mail laws, any marketer who wants to include anything in a commercial e-mail illegal for minors to view or buy must scrub their lists against the registries on a monthly basis for $7 per 1,000 addresses screened in Michigan and $5 per thousand in Utah.

Palnau said Michigan’s figure is total revenue, including the commission paid to Unspam, the contractor maintaining the registries. If the figure is accurate, it means Michigan’s registry has screened 57.8 million e-mail addresses with list sizes averaging just under 264,000 names.

While Michigan released total revenue generated, Utah’s figures are the revenue the state collected minus Unspam’s cut, according to Kevin Olsen, director of Utah’s Department of Consumer Protection.

Unspam gets $4 for every 1,000 addresses screened-an 80% cut in Utah and a 57% cut in Michigan. According to our calculations, this means Utah’s registry generated a little over $100,000 total in its first fiscal year, and a little over $85,000 since July, and screened 34.4 million addresses since it was implemented.

These registries were expected to generate millions of dollars in revenue for the states alone.

“A typical list of a commercial sender includes 100,000 names, and it is estimated that as many as 1 million contact points might be registered in Michigan,” said the state’s Department of Labor and Economic Growth in a report issued before Michigan’s child no-e-mail law was passed. “As a practical matter, the registry would have to be purchased frequently by senders … It is estimated that annual revenue in Utah, a much smaller state, could be in the $3-$6 million range.”

Clearly, the projections have failed to come even close to panning out. But why?

It is unclear if e-mail marketers are simply unaware of the registries, ignoring them, working around them by keeping material aimed at adults out of their messages, or suppressing e-mail to addresses held by people in those states.

According to Trevor Hughes, chief executive of the E-mail Sender and Provider Coalition, reasons for not using the registries vary for companies whose executives know of them.

However, well-known, national and international companies such as Anheuser-Busch aren’t taking any chances with their brands and are using the registries, added Hughes.

“Companies are taking any and all of these possible responses to the registries in Michigan and Utah,” said Hughes. “Many companies are adjusting their business practices to ensure that they are not mailing to e-mail addresses held by people who are residents of these two states. They’re trying to excise Michigan and Utah from their lists, but that can be challenging when we don’t know where someone [holding an e-mail address] lives.”

Critics predicted the registries would have just such a chilling effect on non-pornographic commercial e-mail into Michigan and Utah.

Multiple e-mail marketers contacted for comment refused to speak on or off the record about the registries.

In any case, as the child no-e-mail registries languish in disuse, fixing Michigan’s is apparently not a legislative priority to its original champion.

State Sen. Michael Bishop, the prime sponsor of the bill that established Michigan’s registry, said through a spokesman that though reworking the law is not out of the question, he is currently focused on Michigan’s fiscal troubles.

“A further review of the matter isn’t being ruled out at this time, but Senator Bishop’s main priority is resolving the near $1 billion deficit for the fiscal year already in progress. He remains focused on that for now,” said Louis Meizlish, a spokesman for Bishop.