Why spam will go away.

I was just reading an article outlining "The Webmail Wars" between gmail, hotmail, and yahoo.

I have a few thoughts on this. One is the portability issue, but I'll get to that in a bit. Now the real light bulb that just went off is that Adam Smith is right once again. I think I have the business model of why spam will disappear without government REGULATION.

How does Gmail make money?
Generally speaking, Google places advertisement in your Inbox. If you click though the advertisement, they make money. Google is happy, the advertised website is happy, you are happy.

How do Spammers make money?
Generally speaking, Spammers place advertisements in your Inbox. If you click though or purchase their product, they make money. The Spammer is happy, the advertised website is happy, you are most likely unhappy and that is why you are buying Viagra.

Right now it costs about $20/month to send a spam messages to 5 million individuals. I would honestly guess that for most products, the amount of click through's is in the hundreds at most. My guess is that if that the click though rate was any higher, there would be a higher margin to rent the email list.

Wouldn't it be beneficial for spammers to target their audiences? Of course, but only if the cost wasn't prohibitive. That's where Google's AdWords comes in. Google's AdWords is an open cost model. I would say it works similar to bidding on an auction, ie. "How much are you willing to pay to have somebody click though to your website?"

Cost-per-clicks (CPC) range from $0.05 to $100.00. For a spammer, I would imagine they would be willing to spend $0.05 per click. At $20/month, that yields 400 visitors to their site. I am sure that number is very similar to their current marketing efforts (if not better.) With increased competition between email services, as the above Webmail War article mentioned, the cost will only be driven down lower, maybe even reach a point of only incurring a cost if an item is actually purchased. Other metrics for deciding a cost may be based off if a consumer asks an inquiry, or a consumer spends more then 1 minute on the website, etc. We have only seen the tip of the iceberg when it comes to non-intrusive responsible advertising on the internet. I live in nyc, I am bombarded with advertisements on every street corner, every taxi and bus. We even have bike messengers in this two horse town with advertisements on their bikes.

Now the only problem would be the solicitation of illegal or inappropriate materials, (child porn, porn to youngsters, american eagle ads to hipsters, ...) most likely Google will not allow that, but there appears to be a large market for it. Maybe one solution could be hashcash. The idea has been around for a long time, but if the email market adopted a system like this, I think it could have a substantial impact. Especially when computers become so powerful enough, that it takes minutes to bruteforce an email message to every hotmail account 15 characters in length or shorter. Hashcash could account for this by relying on strong, more complex hashing algorithms.

Also, we will have to watch out for the next wave of attacks, SPIM. However, I envision one day we will all use Gim, Google's answer to Instant Messaging. I would envision AdWords being built directly into our instant messaging conversations. Ohh, you're heading to a party at Brad's house, and Brad lives 12 blocks away in downtown Philly? Well here is a link to 5 liquor stores between your apartment and Brad's house. Click though now and place your order online so it can be ready to be picked up on your walk over.

...

Back to the email portability factor, you know, like the cell phone number issues. A few years back, I had purchased my own domain name to host my email so I could have reliable service and keep an email address I would be happy with. But when I found out that Google was offering an email service with revolutionary searching capabilities, I was all over it and left my old account in the dust. I sent out the necessary boiler plate of "I have moved email accounts, ...." and that was the last time I looked back.

I still check my old email account and reply with updates or change my profile on websites as needed and this has ended up working very well for me. What I haven't done which could be beneficial to a lot of people is to just set up a default email fowarder to my new gmail account. For all intensive purposes, this would keep an existing email address "portable" for those people to scared to loose their precious address.