Economies of Scale in the Spam Business

"Barak Obama Is on the Verge of Death!"

This header on a piece of pre-election spam had credibility problems (spelling the candidate's first name correctly might have helped), but it got people's attention. It was one of a slew of junk-mail blasts that used campaign-related topics to trick unwary readers into open­ing the message. This particular missive carried an image that, when clicked, jumped credulous recipients to an online pharmacy site.

Hacker's Smoke
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Other pre-election spam promised nude pictures of a candidate's wife, blamed the death of a (perfectly healthy) public figure on President Bush, or warned that "The State is in peril." Each ex­ample (captured by anti­spam company Cloudmark) shows spammers trying to make their mass-mailings more enticing by fronting them with fake headlines about prominent people in the news. But who falls for this garbage?

The good news is that few people do. An infiltration of spam networks by researchers offers a rare glimpse into spam "conversion rates"--the percentage of people who respond to each displayed online ad, piece of direct mail, or spam sent. According to the study, "Spamalytics: An Empirical Analysis of Spam Marketing Conversion," only 1 in 12.5 million pieces of spam ended up snaring someone foolish enough to buy from a fake online pharmacy. But even that minuscule re­­sponse rate is enough to reward spammers with a tidy profit.

A host of quiet cookie trackers and other tools help marketers gauge the conversion rate for banner ads and the like, but such numbers for spam are normally very difficult to obtain. To overcome this problem, computer science researchers at University of California campuses in Berkeley and San Diego effectively hijacked a portion of the Storm botnet, which uses a huge network of malware-infected PCs to send spam and conduct other dirty business.

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