Mr. Spam Man

Microsoft wants to shut him down. New York's attorney general wants to see him in court. But Scott Richter keeps thinking big.

Richter maintains that much of the anger directed at him is misplaced. "These anti-spammers, most of them are unemployed people," he sighs. "No life, miserable. They thrive on attention. They have their little newsgroups, and they argue with each other. They're their own worst enemies. I used to care what they think, but not anymore."

He is still smarting from the online bashing he endured after the September 11 attacks, when his flag sales shot through the roof. Like many distributors, he pledged to donate a portion of the proceeds to relief efforts. He scrambled to fill orders, paying premiums to suppliers and watching his profit margin drop. The Spamhaus crowd accused him of "exploiting" the American public. Richter wound up selling 10,000 flags, donating $20,000 to the Red Cross -- and vowing never to do another online fundraiser. "You try to do something nice, and these people do nothing but sit around and bitch," he says.

He insists that he engages in none of the practices groups such as nanae find so objectionable. His mailing list is all "opt in," he says; in other words, the recipients of his mail gave their consent to receive commercial offers when they visited one of his Web sites, or one hosted by his partners or partners' partners, and entered their e-mail addresses. Maybe they didn't read the fine print or check the right box to "opt out," but that's not his problem.

Scott Richter
John Johnston
Scott Richter
Talking trash: Microsoft attorney Brad Smith (left) 
watches as New York Attorney General Eliot Spitzer 
vows to delete Scott Richter's profits.
Stephen Chernin/Getty Images
Talking trash: Microsoft attorney Brad Smith (left) watches as New York Attorney General Eliot Spitzer vows to delete Scott Richter's profits.

"If someone harvests your name off a message board or a Web site, that's an invasion of privacy," he says. "That's a hundred percent wrong. But if you go to a Web site that's advertising 'Win a million dollars,' and you sign up, and they have fifty check boxes there, and you're too ignorant -- because you really think you're going to win a million dollars -- to read what those boxes say, that's your responsibility."

The anti-spammers dismiss Richter's reasoning as so much spamspeak. They say it's unlikely that 45 million e-mail users could sign up for his offers and have no recollection of having done so. Some accuse him of harvesting addresses and hijacking vulnerable servers to carry his mail.

Last spring, Spamhaus reports, an e-mail firm in the United Kingdom collected 175,000 pieces of mail from Richter's company, "addressed to harvested and in thousands of cases nonexistent addresses (proving the address could never have 'opted in' to anything), and provided them...to the BBC together with testimony from sample address holders that no opt-in had ever taken place." And nanae members have posted examples of what they claim are OptInRealBig's efforts to "probe" proxy servers in search of ways to hack into them.

Richter denies that his company has done anything illegal. He notes that he pays $100,000 a month for ISP service to acquire the necessary bandwidth for the volume of mail he sends out. And his business has expanded so rapidly, from marketing his own products to sending out e-mail for other companies and hosting their Web sites, that he says he doesn't need to engage in the underhanded tactics some spammers use to obtain addresses, such as "dictionary attacks" (random generation of words until you hit an actual address) or trolling Web sites and newsgroups for e-mail information.

"We've never harvested," he insists. "We run our own co-registration Web sites now. With our traffic, we can generate 20,000 leads a day, with full profiles -- people coming to our sites for contests, prizes or free e-mail service. From our partners, we can get another hundred or hundred fifty thousand names a day. Their sites have to have the date, time, IP address -- everything. We check them."

OptInRealBig's techniques may seem too scattershot to be effective; fewer than 5 percent of spam recipients bother to open the message, and fewer than 1 percent order anything. But if you're sending out 50 million messages, even those response rates can pay off. And Richter says the firm does engage in a kind of target marketing, even when penis pills or breast enhancements show up in the opposite gender's mailbox.

"We send breast-enlargement pills for a company here in town," he says. "Fifty percent of their customers are males. Bodybuilders love it. We have a product called Viagel, which is a female arousal cream. You'd be surprised how many times a guy buys it as a gift, or because his wife would never buy it."

Richter says he averages one spam complaint for every 10 million e-mails -- an astonishingly low number -- and that all of his mail clearly identifies the sender and has a working "unsubscribe" link. Some spammers use the link to confirm good addresses and redouble their efforts, but Richter swears that's not his way.

"The media has done a good job of telling people not to trust unsubscribe links," he says. "But if somebody wants off our list, we'll never send to them again. We want to fly under the radar. The last thing I want is to have 10,000 spam complaints coming into my ISP."

A new federal law requires bulk e-mailers to use genuine return addresses and working unsubscribe links. It also prohibits deceptive subject lines and the harvesting of addresses. But many anti-spammers say the CANSPAM (Controlling the Assault of Non-Solicited Pornography and Marketing) Act is, in fact, a license to spam, since it supersedes more restrictive state laws and fails to ban unsolicited bulk mail outright.

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