Internet Technologies Spam – October 11, 2005
Internet Technologies USC Football How to Get An A in This Class Easy Questions Arcane Minutia
It is loved by Margaret Thatcher, Vikings and Herbal Viagra Users. A-A1
What is Spam?
Is this Spam?
Questions <ul><li>What is spam? </li></ul><ul><li>Is spam intrinsically  </li></ul><ul><ul><li>Good </li></ul></ul><ul><ul...
What Makes Spam Bad? <ul><li>Intrinsic </li></ul><ul><li>Transfers Costs to Recipient </li></ul><ul><ul><li>Server Load </...
What Constitutes Consent? Double Opt-In Confirmed Opt-In Opt-In Confirmed Opt-Out Opt-Out Implied Consent
Online Advertising
Email Marketing
Email Marketing 101 Advertiser  Product or Service Marketer Mailing List &  Transmission Capability Marketing Network Acce...
Email Registration Registration Page
“ Selected Advertisers and Affiliates”
Legitimate Email Marketing  Response Rates
Spamenomics: Supply
Spamenomics: Demand <ul><li>Top spammers send 15 million per day </li></ul><ul><li>Estimated Response Rate: 0.1 to 1.0 %  ...
Spamenomics: Return <ul><li>Example 1 </li></ul><ul><li>Spammer Marketing for Client </li></ul><ul><li>Delivery Rate:  5 M...
Fighting Spam: Private Sector Responses <ul><li>Blacklists </li></ul><ul><li>White Lists </li></ul><ul><li>Spam Filters  <...
Email Statistics <ul><li>ISP's block an estimated 90% of spam </li></ul>14.5B SPAM/Day <ul><li>60% of all E-mail = spam (n...
Spam Filters <ul><li>Billion Dollar Market – will increase 75% over next 4 years </li></ul><ul><li>False Positives – cost ...
Legislative Response <ul><li>1995-2003 </li></ul><ul><li>USA : Approx 40 states pass Spam laws. </li></ul><ul><li>EU:   Ad...
CAN-SPAM Act  <ul><li>Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 </li></ul><ul><ul><li...
CAN-SPAM Principal Requirements From line must  identify sender Subject line must not be deceptive.  Adult Messages must p...
Penalties <ul><li>Federal: </li></ul><ul><ul><li>Up to $10,000 per violation </li></ul></ul><ul><ul><li>Criminal penalties...
Is CAN-SPAM a Failure? <ul><li>YES </li></ul><ul><li>Overall Compliance Rate  </li></ul><ul><ul><li>January 2004 – 0.54% <...
CAN-SPAM At Work
State Spam Laws <ul><li>CAN-SPAM  Does Not  Preempt </li></ul><ul><ul><li>State laws that “are not specific to electric ma...
Foreign Spam Laws <ul><li>No Spam Legislation </li></ul><ul><li>Industry Canada Anti-Spam Task-Force Report in Spring 2005...
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Spam Law - USC 2005

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  • To put this in perspective, 1.5 billion, start counting one number per second right now – if you keep going without sleeping, count while you’re eating, etc., you can stop in 47.5 YEARS . This is how many spams get through EVERY DAY . I think they all end up in my inbox! Starts a vicious cycle between ISPs &amp; Spammers (Spam increases, ISP filtering increases, spam increases, filtering increases, etc.), and legitimate marketers end up being victims as well, as many legitimate messages end up as “false positives”. =========================== A billion seconds ago it was 1972. A billion minutes ago the Roman Coliseum was dedicated. A billion hours ago our ancestors were living in the Stone Age. A billion dollars ago was only 4.4 hours at the rate Washington spends it.
  • Spam Law - USC 2005

    1. 1. Internet Technologies Spam – October 11, 2005
    2. 2. Internet Technologies USC Football How to Get An A in This Class Easy Questions Arcane Minutia
    3. 3. It is loved by Margaret Thatcher, Vikings and Herbal Viagra Users. A-A1
    4. 4. What is Spam?
    5. 5. Is this Spam?
    6. 6. Questions <ul><li>What is spam? </li></ul><ul><li>Is spam intrinsically </li></ul><ul><ul><li>Good </li></ul></ul><ul><ul><li>Bad or </li></ul></ul><ul><ul><li>Neutral? </li></ul></ul>
    7. 7. What Makes Spam Bad? <ul><li>Intrinsic </li></ul><ul><li>Transfers Costs to Recipient </li></ul><ul><ul><li>Server Load </li></ul></ul><ul><ul><li>Cost of Filters </li></ul></ul><ul><li>Clogs Inbox at Expense of Legitimate Email </li></ul><ul><li>Scares Consumers </li></ul><ul><li>Contextual </li></ul><ul><li>False From Lines or Routing Information </li></ul><ul><li>Pornography </li></ul><ul><li>Phishing </li></ul><ul><li>419 Schemes </li></ul><ul><li>Viruses </li></ul>
    8. 8. What Constitutes Consent? Double Opt-In Confirmed Opt-In Opt-In Confirmed Opt-Out Opt-Out Implied Consent
    9. 9. Online Advertising
    10. 10. Email Marketing
    11. 11. Email Marketing 101 Advertiser Product or Service Marketer Mailing List & Transmission Capability Marketing Network Access to Network of Marketers Consumer Consumer
    12. 12. Email Registration Registration Page
    13. 13. “ Selected Advertisers and Affiliates”
    14. 14. Legitimate Email Marketing Response Rates
    15. 15. Spamenomics: Supply
    16. 16. Spamenomics: Demand <ul><li>Top spammers send 15 million per day </li></ul><ul><li>Estimated Response Rate: 0.1 to 1.0 % </li></ul><ul><li>20 percent of U.S. residents report buying products from spammers </li></ul><ul><li>30 percent have responded to spam </li></ul>
    17. 17. Spamenomics: Return <ul><li>Example 1 </li></ul><ul><li>Spammer Marketing for Client </li></ul><ul><li>Delivery Rate: 5 MM/day </li></ul><ul><li>Payment: $1.75 CPA </li></ul><ul><li>Annual Revenue </li></ul><ul><ul><li>0.1% Response: $3,062,500 </li></ul></ul><ul><ul><li>1.0% Response: $30,625,000 </li></ul></ul><ul><li>Example 2 Spammer Selling Product </li></ul><ul><li>Product: Eavesdropping Software @ $40 </li></ul><ul><li>Delivery Rate: 10 Million per day </li></ul><ul><li>Response Rate: 0.000005 % or 50 per day </li></ul><ul><li>Annual Revenue: $700,000 </li></ul>
    18. 18. Fighting Spam: Private Sector Responses <ul><li>Blacklists </li></ul><ul><li>White Lists </li></ul><ul><li>Spam Filters </li></ul><ul><li>Challenge/Response Mechanisms </li></ul><ul><li>Sender ID </li></ul>
    19. 19. Email Statistics <ul><li>ISP's block an estimated 90% of spam </li></ul>14.5B SPAM/Day <ul><li>60% of all E-mail = spam (not % of what’s in inboxes) </li></ul>24B Emails/Day <ul><li>It’s estimated that there are ~ 24B E-mail messages per day </li></ul>
    20. 20. Spam Filters <ul><li>Billion Dollar Market – will increase 75% over next 4 years </li></ul><ul><li>False Positives – cost businesses $3.5BB in 2003 (Ferris Research) </li></ul><ul><ul><li>McAfee Spam Killer 5.0 22.3% false positives (Source PC World) </li></ul></ul><ul><li>Triggers </li></ul><ul><ul><li>Image Links </li></ul></ul><ul><ul><li>ALL CAPS text </li></ul></ul><ul><ul><li>Key Words (Viagra) </li></ul></ul><ul><ul><li>From” Address Does Not Match Header </li></ul></ul><ul><ul><li>Opt-Out Mechanism </li></ul></ul><ul><ul><li>Volume </li></ul></ul><ul><ul><li>Blacklists </li></ul></ul>
    21. 21. Legislative Response <ul><li>1995-2003 </li></ul><ul><li>USA : Approx 40 states pass Spam laws. </li></ul><ul><li>EU: Adopts Data Protection Directive, implemented in UK as Data Protection Act of 1998. </li></ul><ul><li>Where email addresses collected from a person, must be informed of the purposes at the time of collection. Unsolicited Commercial Email must be “identifiable clearly and unambiguously”. </li></ul><ul><li>2002 </li></ul><ul><li>EU: Adopts Directive 2002/58/EC on Privacy and Electronic Communications </li></ul><ul><li>September 2003 </li></ul><ul><li>USA : California passes SB 186 banning email unless express consent to receive email from advertiser. </li></ul><ul><li>EU: UK Regulations Implementing EU Directive effective 11 December 2003 </li></ul><ul><li>December 2003 </li></ul><ul><li>CAN-SPAM Act of 2003 signed by President Bush (preempts State Spam laws) – effective 1 January 2004 </li></ul>
    22. 22. CAN-SPAM Act <ul><li>Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 </li></ul><ul><ul><li>Does not “CAN Spam” – except for wireless spam </li></ul></ul><ul><ul><li>No “Do Not Email Registry” </li></ul></ul><ul><ul><li>No “ADV” Requirement </li></ul></ul><ul><li>Anti-Fraud & Disclosure Statute </li></ul><ul><li>Applies to an email where the “primary purpose” is commercial advertisement or promotion of a product/service </li></ul><ul><ul><li>No volume requirement </li></ul></ul><ul><ul><li>Is sending a resume subject to CAN-SPAM? </li></ul></ul>
    23. 23. CAN-SPAM Principal Requirements From line must identify sender Subject line must not be deceptive. Adult Messages must provide notice . Requires Working Opt-Out Mechanism for Advertiser Postal Address for Advertiser
    24. 24. Penalties <ul><li>Federal: </li></ul><ul><ul><li>Up to $10,000 per violation </li></ul></ul><ul><ul><li>Criminal penalties for fraud and email abuse (address harvesting and dictionary attacks) </li></ul></ul><ul><li>State: </li></ul><ul><ul><li>$250 per email/ $2 million cap </li></ul></ul><ul><ul><li>Treble damages if willful violation </li></ul></ul><ul><li>ISP Enforcement </li></ul><ul><ul><li>$25 per email/ $1 million cap </li></ul></ul><ul><ul><li>Treble damages if willful violation </li></ul></ul>
    25. 25. Is CAN-SPAM a Failure? <ul><li>YES </li></ul><ul><li>Overall Compliance Rate </li></ul><ul><ul><li>January 2004 – 0.54% </li></ul></ul><ul><ul><li>December 2004 – 7% </li></ul></ul><ul><ul><li>Source: MX Logic </li></ul></ul><ul><li>Major Online Companies </li></ul><ul><ul><li>33% Fully Compliant </li></ul></ul><ul><ul><li>98.2% Compliance on honoring opt-outs </li></ul></ul><ul><ul><li>Source: Ariel Software </li></ul></ul><ul><li>NO </li></ul><ul><li>No, CAN-SPAM is not a ‘miserable failure,&quot; as was widely misreported – Rebecca Lieb (ClickZ News 1/14/05) </li></ul><ul><li>CAN-SPAM is a tool that is being used </li></ul><ul><ul><li>Multiple actions by FTC, State AGs and ISPs </li></ul></ul><ul><li>AOL – 75% drop in Spam complaints in November </li></ul>
    26. 26. CAN-SPAM At Work
    27. 27. State Spam Laws <ul><li>CAN-SPAM Does Not Preempt </li></ul><ul><ul><li>State laws that “are not specific to electric mail, including State trespass, contract or tort laws”; OR other State laws “to the extent that those laws relate to acts of fraud or computer crime” </li></ul></ul><ul><li>California Chapter 571 (effective January 1, 2005) </li></ul><ul><ul><li>Prohibits e-mail using third-party domain without permission; falsified or forged headers or deceptive subject lines. </li></ul></ul><ul><ul><li>Private right of action - damages of $1,000 per email up to $1MM “per incident ” </li></ul></ul><ul><li>Michigan & Utah Child Registry Laws </li></ul>
    28. 28. Foreign Spam Laws <ul><li>No Spam Legislation </li></ul><ul><li>Industry Canada Anti-Spam Task-Force Report in Spring 2005 </li></ul><ul><li>Prohibits Spam, address harvesting, deceptive emails </li></ul><ul><ul><li>Prohibits Spam – except </li></ul></ul><ul><ul><ul><li>May send UCE to existing customer </li></ul></ul></ul><ul><ul><ul><li>Does not apply to B-B marketing (i.e., corporate email address) </li></ul></ul></ul><ul><ul><li>Prohibits Spam </li></ul></ul><ul><ul><li>Requires Legislation By Member Countries – Not All Have Complied </li></ul></ul>
    29. 29. Thank You
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