: Code 2.0

Regulating Spam

Regulating Spam

Spam is perhaps the most theorized problem on the Net. There are scores of books addressing how best to deal with the problem. Many of these are filled with ingenious technical ideas for ferreting out spam, from advanced Bayesian filter techniques to massive redesigns of the e-mail system.

But what is most astonishing to me as a lawyer (and depressing to me as the author of Code) is that practically all of these works ignore one important tool with which the problem of spam could be addressed: the law. Its not that they weigh the value of the law relative to, for example, Bayesian filters or the latest in heuristic techniques, and conclude it is less valuable than these other techniques. Its that they presume the value of the law is zero as if spam were a kind of bird flu which lived its own life totally independently of what humans might want or think.

This is an extraordinary omission in what is, in effect, a regulatory strategy. As I have argued throughout this book, the key to good policy in cyberspace is a proper mix of modalities, not a single silver bullet. The idea that code alone could fix the problem of spam is silly code can always be coded around, and, unless the circumventers are not otherwise incentivized, they will code around it. The law is a tool to change incentives, and it should be a tool used here as well.

Most think the law cant play a role here because they think spammers will be better at evading the law than they are at evading spam filters. But this thinking ignores one important fact about spam. Spam is not a virus. Or at least, when talking about spam, Im not talking about viruses. My target in this part is communication that aims at inducing a commercial transaction. Many of these transactions are ridiculous drugs to stop aging, or instant weight loss pills. Some of these transactions are quite legitimate special sales of overstocked products, or invitations to apply for credit cards. But all of these transactions aim in the end to get something from you: Money. And crucially, if they aim to get money from you, then there must be someone to whom you are giving your money. That someone should be the target of regulation.

So what should that regulation be?

The aim here, as with porn, should be to regulate to the end of assuring what we could call consensual communication. That is, the only purpose of the regulation should be to block nonconsensual communication, and enable consensual communication. I dont believe that purpose is valid in every speech context. But in this context private e-mail, or blogs, with limited bandwidth resources, with the costs of the speech born by the listener it is completely appropriate to regulate to enable individuals to block commercial communications that they dont want to receive.

So how could that be done?

Today, the only modality that has any meaningful effect upon the supply of spam is code. Technologists have demonstrated extraordinary talent in devising techniques to block spam. These techniques are of two sorts one which is triggered by the content of the message, and one which is triggered by the behavior of the sender.

The technique that is focused upon content is an array of filtering technologies designed to figure out what the meaning of the message is. As Jonathan Zdziarski describes, these techniques have improved dramatically. While early heuristic filtering techniques had error rates around 1 in 10, current Bayesian techniques promise up to 99.5% 99.95% accuracy[58].

But the single most important problem with these techniques is the arms race that they produce[59]. Spammers have access to the same filters that network administrators use to block spam at least if the filters are heuristic[60]. They can therefore play with the message content until it can defeat the filter. That then requires filter writers to change the filters. Some do it well; some dont. The consequence is that the filters are often over and under inclusive blocking much more than they should or not blocking enough.

The second code-based technique for blocking spam focuses upon the e-mail practices of the sender meaning not the person sending the e-mail, but the server that is forwarding the message to the recipient. A large number of network vigilantes by which I mean people acting for the good in the world without legal regulation have established lists of good and bad e-mail servers. These blacklists are compiled by examining the apparent rules the e-mail server uses in deciding whether to send e-mail. Those servers that dont obey the vigilantes rules end up on a blacklist, and people subscribing to these blacklists then block any e-mail from those servers.

This system would be fantastic if there were agreement about how best to avoid misuse of servers. But there isnt any such agreement. There are instead good faith differences among good people about how best to control spam[61]. These differences, however, get quashed by the power of the boycott. Indeed, in a network, a boycott is especially powerful. If 5 out of 100 recipients of your e-mail cant receive it because of the rules your network administrator adopts for your e-mail server, you can be sure the servers rules however sensible will be changed. And often, theres no appeal of the decision to be included on a blacklist. Like the private filtering technologies for porn, theres no likely legal remedy for wrongful inclusion on a blacklist. So many types of e-mail services cant effectively function because they dont obey the rules of the blacklists.

Now if either or both of these techniques were actually working to stop spam, I would accept them. Im particularly troubled by the process-less blocking of blacklists, and I have personally suffered significant embarrassment and costs when e-mail that wasnt spam was treated as spam. Yet these costs might be acceptable if the system in general worked.

But it doesnt. The quantity of spam continues to increase. The Raducatu Group predicts that by 2007, 70% of all e-mail will be spam[62]. And while there is evidence that the rate of growth in spam is slowing, theres no good evidence the pollution of spam is abating[63]. The only federal legislative response, the CAN-SPAM Act, while preempting many innovative state solutions, is not having any significant effect[64].

Not only are these techniques not blocking spam, they are also blocking legitimate bulk e-mail that isnt at least from my perspective[65] spam. The most important example is political e-mail. One great virtue of e-mail was that it would lower the costs of social and political communication. That in turn would widen the opportunity for political speech. But spam-blocking technologies have now emerged as a tax on these important forms of social speech. They have effectively removed a significant promise the Internet originally offered.

Thus, both because regulation through code alone has failed, and because it is actually doing harm to at least one important value that the network originally served, we should consider alternatives to code regulation alone. And, once again, the question is, what mix of modalities would best achieve the legitimate regulatory end?

Begin with the problem: Why is spam so difficult to manage? The simple reason is that it comes unlabeled. Theres no simple way to know that the e-mail youve received is spam without opening the e-mail.

Thats no accident. Spammers know that if you knew an e-mail was spam, you wouldnt open it. So they do everything possible to make you think the e-mail youre receiving is not spam.

Imagine for a moment that we could fix this problem. Imagine a law that required spam to be labeled, and imagine that law worked. I know this is extremely difficult to imagine, but bear with me for a moment. What would happen if every spam e-mail came with a specified label in its subject line something like ADV in the subject line[66].

Well, we know what would happen initially. Everyone (or most of us) would either tell our e-mail client or ask our e-mail service to block all e-mail with ADV in the subject line. It would be glorious moment in e-mail history, a return to the days before spam.

But the ultimate results of a regulation are not always its initial results. And its quite clear with this sort of regulation, initial results would be temporary. If theres value in unsolicited missives to e-mail inboxes, then this initial block would be an incentive to find different ways into an inbox. And we can imagine any number of different ways:

Senders could get recipients to opt-into receiving such e-mail. The opt-in would change the e-mail from unsolicited to solicited. It would no longer be spam.

Senders could add other tags to the subject line. For example, if this spam were travel spam, the tags could be ADV Travel. Then recipients could modify their filter to block all ADV traffic except Travel e-mails.

Senders could begin to pay recipients for receiving e-mails. As some have proposed, the e-mail could come with an attachment worth a penny, or something more. Recipients could select to block all ADVs except those carrying cash.

The key to each of these modified results is that the recipient is now receiving commercial e-mail by choice, not by trick. This evolution from the initial regulation thus encourages more communication, but only by encouraging consensual communication. Nonconsensual communication assuming again the regulation was obeyed would be (largely) eliminated.

So in one page, Ive solved the problem of spam assuming, that is, that the labeling rule is obeyed. But that, of course, is an impossible assumption. What spammer would comply with this regulation, given the initial effect is to radically shrink his market?

To answer this question, begin by returning to the obvious point about spam, as opposed to viruses or other malware. Spammers are in the business to make money. Money-seekers turn out to be relatively easy creatures to regulate. If the target of regulation is in it for the money, then you can control his behavior by changing his incentives. If ignoring a regulation costs more than obeying it, then spammers (on balance) will obey it. Obeying it may mean changing spamming behavior, or it may mean getting a different job. Either way, change the economic incentives, and you change spamming behavior.

So how can you change the incentives of spammers through law? What reason is there to believe any spammer would pay attention to the law?

People ask that question because they realize quite reasonably that governments dont spend much time prosecuting spammers. Governments have better things to do (or so they think). So even a law that criminalized spam is not likely to scare many spammers.

But what we need here is the kind of creativity in the adaptation of the law that coders evince when they build fantastically sophisticated filters for spam. If law as applied by the government is not likely to change the incentives of spammers, we should find law that is applied in a way that spammers would fear.

One such innovation would be a well-regulated bounty system. The law would require spam to be marked with a label. Thats the only requirement. But the penalty for not marking the spam with a label is either state prosecution, or prosecution through a bounty system. The FTC would set a number that it estimates would recruit a sufficient number of bounty hunters. Those bounty hunters would then be entitled to the bounty if theyre the first, or within the first five, to identify a responsible party associated with a noncomplying e-mail.

But how would a bounty hunter do that? Well, the first thing the bounty hunter would do is determine whether the regulation has been complied with. One part of that answer is simple; the other part, more complex. Whether a label is attached is simple. Whether the e-mail is commercial e-mail will turn upon a more complex judgment.

Once the bounty hunter is convinced the regulation has been breached, he or she must then identify a responsible party. And the key here is to follow an idea Senator John McCain introduced into the only spam legislation Congress has passed to date, the CAN-SPAM Act. That idea is to hold responsible either the person sending the e-mail, or the entity for which the spam is an advertisement.

In 99 percent of the cases, it will be almost impossible to identify the person sending the spam. The techniques used by spammers to hide that information are extremely sophisticated[67].

But the entity for which the spam is an advertisement is a different matter. Again, if the spam is going to work, there must be someone to whom I can give my money. If it is too difficult to give someone my money, then the spam wont return the money it needs to pay.

So how can I track the entity for which the spam is an advertisement?

Here the credit card market would enter to help. Imagine a credit card call it the bounty hunters credit card that when verified, was always declined. But when that credit card was used, a special flag was attached to the transaction, and the credit card holder would get a report about the entity that attempted the charge. The sole purpose of this card would be to ferret out and identify misbehavior. Credit card companies could charge something special for this card or charge for each use. They should certainly charge to make it worthwhile for them. But with these credit cards in hand, bounty hunters could produce useable records about to whom money was intended to be sent. And with that data, the bounty hunter could make his claim for the bounty.

But whats to stop some malicious sort from setting someone else up? Lets say I hate my competitor, Ajax Cleaners. So I hire a spammer to send out spam to everyone in California, promoting a special deal at Ajax Cleaners. I set up an account so Ajax received the money, and then I use my bounty credit card to nail Ajax. I show up at the FTC to collect my bounty; the FTC issues a substantial fine to Ajax. Ajax goes out of business.

This is a substantial concern with any bounty system. But it too can be dealt with through a careful reckoning of incentives. First, and obviously, the regulation should make such fraud punishable by death. (Ok, not death, but by a significant punishment). And second, any person or company charged with a violation of this spam statute could assert, under oath, that it did not hire or direct any entity to send spam on its behalf. If such an assertion is made, then the company would not be liable for any penalty. But the assertion would include a very substantial penalty if it is proven false a penalty that would include forfeiture of both personal and corporate assets. A company signing such an oath once would likely be given the benefit of the doubt. But a company or individual signing such an oath more than once would be a target for investigation by the government. And by this stage, the exposure that the spammers would be facing would be enough to make spamming a business that no longer pays.

Here again, then, the solution is a mixed modality strategy. A LAW creates the incentive for a certain change in the CODE of spam (it now comes labeled). That law is enforced through a complex set of MARKET and NORM-based incentives both the incentive to be a bounty hunter, which is both financial and normative (people really think spammers are acting badly), as well as the incentive to produce bounty credit cards. If done right, the mix of these modalities would change the incentives spammers face. And, if done right, the change could be enough to drive most spammers into different businesses.

Of course there are limits to this strategy. It wont work well with foreign sites. Nor with spammers who have ideological (or pathological) interests. But these spammers could then be the target of the code-based solutions that I described at the start. Once the vast majority of commercially rational spam is eliminated, the outside cases can be dealt with more directly.

This has been a long section, but it makes a couple important points. The first is a point about perspective: to say whether a regulation abridges the freedom of speech, or of the press we need a baseline for comparison. The regulations I describe in this section are designed to restore the effective regulation of real space. In that sense, in my view, they dont abridge speech.

Second, these examples show how doing nothing can be worse for free-speech values than regulating speech. The consequence of no legal regulation to channel porn is an explosion of bad code regulation to deal with porn. The consequence of no effective legal regulation to deal with spam is an explosion of bad code that has broken e-mail. No law, in other words, sometimes produces bad code. Polk Wagner makes the same point: law and software together define the regulatory condition. Less law does not necessarily mean more freedom[68]. As code and law are both regulators (even if different sorts of regulators) we should be avoiding bad regulation of whatever sort.

Third, these examples evince the mixed modality strategy that regulating cyberspace always is. There is no silver bullet whether East Coast code or West Coast code. There is instead a mix of techniques modalities that must be balanced to achieve a particular regulatory end. That mix must reckon the interaction among regulators. The question, as Polk Wagner describes it, is for an equilibrium. But the law has an important role in tweaking that mix to assure the balance that advances a particular policy.

Here, by regulating smartly, we could avoid the destructive code-based regulation that would fill the regulatory gap. That would, in turn, advance free speech interests.


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