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Needed: A Beefier CAN-SPAM Bill

By Jane Black On Oct. 23, the Senate passed CAN-SPAM, an antijunk e-mail measure, 97-0. Not to be left out, the House plans to discard two competing bills and bring to a vote a virtually identical bill as early as Oct. 31. Fighting junk mail is a political home run: After all, studies show that the daily deluges of unsolicited junk e-mail are increasingly burying genuine messages, perhaps even threatening the future of the Internet's first and greatest killer app.

According to the Pew Internet & American Life survey, released Oct. 22, more than half of all e-mailers (52%) say spam has made them less trusting of e-mail, while one-quarter blame it for reducing their overall use of e-mail.

The CAN-SPAM bill, sponsored by Senator Conrad Burns (R-Mont.) and Senator Ron Wyden (D-Ore.), has three main aims: to criminalize the shady tricks spammers use to sneak unwanted mail into innocents' in-boxes, to require labeling of sexually explicit content and ensure that no graphic pictures appear when the mail is opened, and to mandate that all marketers offer consumers the right to refuse or opt out of receiving further messages.

HIT HARDER. It's a start, but no one -- not even the senators themselves -- expects the bill to end the scourge of spam. Sophisticated technology and consumer education also have a role to play. Senator John McCain (R-Ariz.) summed up the mood after the lawmakers' vote, saying: "The odds of defeating spam by legislation alone are extremely low, but that doesn't mean we should stand idly by and do nothing about it."

Yet in their hurry to pass something -- anything -- to please voters, legislators may be missing an opportunity to truly stem this ever-growing tide. According to spam-fighter Brightmail, unwanted junk mail accounted for 54% of the e-mail sent in September, up from just 8% in September, 2001. To reverse the trend, federal legislation must put more of an emphasis on enforcement. "If the hammer misses its mark most of the time, you want it to hit hard on the occasion when it finally does," says Andrew Lochart, director of product marketing at Postini, a Redwood City (Calif.) antispam outfit.

CAN-SPAM should permit individuals to take spammers to court -- and set a minimum statutory damage of $100 or $200 per message. As the bill stands, only federal agencies, led by the woefully understaffed Federal Trade Commission, state attorneys general, and Internet service providers (ISPs) can sue. In most cases, damages are capped at $1 million -- which barely registers at America's largest conglomerates.

REMEMBER JUNK FAXES? Worse, an amendment proposed by Senator McCain that makes third parties liable if they "knowingly" permit their products to be promoted by somebody else -- for example, if drug company knowingly benefits from spam hawking a specific prescription treatment for impotence -- would be enforceable only by the FTC.

Supporters of the bill argue that while most consumers will simply hit the delete key instead of hitting spammers with a lawsuit, ISPs have the technical skills and financial incentive to hunt down spammers. But the consumer's right to sue is crucial to keeping scurrilous marketers in check. If it were to cost $100 a pop, any company that illegally sends 100,000 messages would learn -- quickly -- to follow the rules.

History shows that a so-called private right of action works. In 1991, a law prohibiting junk faxes granted consumers the right to recover either actual monetary damages or $500 per junk fax, whichever was greater. And if a court found that the sender had "willfully or knowingly" violated the act, it could increase the award up to three times the amount of damages. How many unsolicited faxes have you received lately?

SUNSHINE STATE SPAM. Still, Congress needs to do far more than just make spam illegal. It must give law enforcement the tools -- and resources -- it needs. Allocating money or creating a spam task force has likely not been seriously considered because conventional wisdom holds that most criminal spammers are overseas. But according to Spamhaus, a nonprofit that tracks the worst offenders, approximately 90% of spam comes from just 150 criminal spammers -- and at least 40 of them are based in Boca Raton, Fla.

"The real issue is to motivate law-enforcement agencies to work the way they do with drugs and terrorism to get rid of this insidious invasion of our privacy" says Andrew Miller, a member of Britain's Parliament who visited the U.S. earlier in October as part of a delegation to plead with American legislators to get tough on spam. Granted, no one is likely to die as the result of a spam attack. But the money and time that individuals and corporations are losing from contending with spam adds up.

And as Chris Murray, legislative counsel at Consumers Union, points out: "You're not going to stop anything with the FTC in charge. The FTC only has the resources to go after big actors -- and most of the spam that's being sent out comes from nickel-and-dimers looking to make extra money from home."

OPT-IN OPTION. Enforcement isn't the only part of the bill that could be beefed up. Most privacy advocates would like marketers to get explicit permission before sending out any messages, rather than giving consumers only the choice to opt-out of further communication. Opt-in is already the standard in European countries and Japan. California has adopted an opt-in law that would go into effect Jan. 1 -- if it's not preempted by the CAN-SPAM Act. Opt-in is a worthy goal, but the powerful direct-marketing lobby and First Amendment concerns mean a federal opt-in regime is a nonstarter.

Perhaps it's not too late to hope that the House might decide to craft a bill with some teeth rather than rubber-stamping what the Senate has approved. Watchdog agencies, law enforcement, and consumers must be empowered to crack down on both legitimate marketers and criminal spammers who break the law. It's the only way legislation can really can spam. Black writes for BusinessWeek Online in London

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