April 11th, 2008
Posted in Uncategorized
“Spamonomics”: The Economics of Spamming
Spammers earn billions of dollars annually. The business is efficient, hierarchical, and organized. In much the same way that the global trade in narcotics involves every conceivable method of smuggling (from submarines to drug mules), the spam trade employs software engineers to develop increasingly sophisticated delivery technologies. Just as the drug trade will continue until the end of humanity, so too will the illegal delivery of spam.
To understand how spamming has become such an intractable problem, it serves to analyze the economics that drive spamming. Spammers make money if one in every 30,000 recipients makes a purchase. And given this response rate, a spammer advertising pharmaceutical products can expect to make roughly $5,000 per million email messages sent.
Finding out what it costs to send spam is not difficult: Botnet operators advertise their spamming services via online forums. One forum mentioned a price of $100 to send one million spam messages. If we assume that $100 is the cost per million spam messages, and $5,000 is the revenue, then the gross margin from spamming is approximately 98 percent.
Although some spam filters provide better accuracy than others, filter accuracy across the board is approximately 90 per cent, meaning that only one in ten spam messages reach a recipient. If global anti-spam effectiveness could be improved from 90 to 95 per cent, earning $5,000 from spamming would require sending 2 million spam messages, rather than 1 million. This increase in volume would reduce the spammers’ profit margin from 98 per cent to 96 per cent assuming sending costs remained constant. If global anti-spam accuracy reaches 99 per cent — a figure that experts will tell you is nearly inconceivable given the innovative methods of spammers — sending costs would reduce spamming margin to 80 per cent. Google is one of the world’s most profitable advertising companies with a margin of 25 per cent — imagine 80 per cent? This is a business that won’t be going away any time soon.
Before botnets arrived, spammers could be stopped by blocking their IP addresses. DNSBLs like Spamhaus and Habeas block between 60-70%. With the introduction of botnets, blocking no longer provides a sufficient solution to the spam problem.
NEXT: Post #5 Why Are Botnets So Difficult To Stop?
PREVIOUS: Post #3 Final Ultimate Solution to the Spam Problem (FUSSP)
Tags: accuracy, anti-spam, DSNBLs, economics, google, Habeas, IP-addresses, profit, spam, spamhaus, spamonomics
April 7th, 2008
Posted in Uncategorized
Once Promising Proposals for a Final Ultimate Solution to the Spam Problem (FUSSP)
“Two years from now, spam will be solved.”
That was Bill Gates’ famous pronouncement back in 2004. Microsoft, Yahoo and the open source community devised two techniques that they believed would eradicate spam. The first was sender authentication, which allowed email senders to provide a list of the servers permitted to send email for users within their domain. The idea was that sender authentication would eliminate spammers spoofing legitimate email addresses, and allow for the creation of a permanent, ironclad white list of trustworthy domains that never send spam, thus allowing recipients to simply block everything not on the white list and end spam forever.
Another idea pitched in 2004 was the computational challenge. Senders would, upon connecting to a receiving email server, have to spend considerable CPU cycles computing the answer to a mathematical challenge provided by the receiving server. Bill Gates believed this approach would stop spam by making it cost too much to send the high volumes of email required to make spamming profitable.
Unfortunately, neither sender authentication nor the computational challenge technique resolved the spam problem. Computational challenges were rejected as being too costly for legitimate bulk email senders (airlines, banks, open source mailing lists, etc.) And sender authentication while eventually enjoying wide-spread adoption in the form of DKIM and SenderID, proved prone to errors. As as result it has remained useful mostly for the acceptance of legitimate email and phishing protection rather than the rejection of spam.
By 2005, what the anti-spam community was getting right was content filtering. When spam filters had reached above the 90 per cent accuracy level, spam transitioned from a problem of content to a problem of volume, the spammers simply send more spam. And they can do this because the recipient pays the cost of content filtering rather than the spammer.
The cost of a resource-consuming filtering system increases during high traffic loads. If you block spam content, spammers will find new ways to get around it. Bill Gates was right, the only way to stop them is to create difficulty by making spam too costly to send. If you do spammers are left to find new targets that are easier to hit.
NEXT: Post #4 Spamonomics: The Economics of Spamming
PREVIOUS: Post #2 Prohibition Induces “Botlegging”
Tags: accuracy, anti-spam, bill gates, content-filters, dkim, economics, high traffic loads, microsoft, spam, spammers, spamonomics, yahoo