Spam Still Turns a Profit

by Sachin Balagopalan on November 10, 2008 · 1 comment

Ever wonder how many people actually click and respond to those Viagra emails - or any of the other gazillion junk mail - most of us are frequently inundated with in our in-boxes? Apparently the number is incredibly small - one response for every 12.5 million emails sent according to a study conducted by researchers at UC Berkley and UC San Diego. In spite of the small response rate the researchers concluded that a well “oiled” spam network could easily generate around $3.5 million a year in revenue - certainly not chump change if you ask me!

The researchers actually hijacked a live spam network called Storm and took over a small subset of home computers or “worker bots” and rerouted their traffic to a website that mimicked the one setup by Storm’s creators. They then rigged the site to return an error message whenever a potential “customer” tried to conduct a transaction. Ars Technica breaks down the numbers quite well …

After sending some 350 million e-mail messages over 26 days, Savage and his team had “sold” just 28 “male enhancement” products for just under $100 each. This works out to a conversion rate that’s described as “well under” 0.00001 percent. Total revenue for the period would have been $2,731.88, a bit over $100 a day. That’s chump change by corporate standards, and it’s why the spam industry relies on truly massive campaigns the way it does. By the scientists’ estimates, they controlled just 1.5 percent of the total Storm network. Extrapolate their earnings against Storm’s actual size, and the botnet may have been raking in as much as $7,000 a day ($9,500 if we only count the days Storm was actively conducting a campaign). For the curious, that works out to some $3.5 million in revenue per year.

Pretty incredible when you see the numbers broken down this way. What surprises me is that people actually respond to spam - albeit in small numbers - in spite of all the negative press and spam filters implemented by email servers throughout. Also incredible is their “business model”. The spammers don’t actually send the spam from their own servers. Instead they infect people’s computers with worker bots that in turn send out the spam. The worker bots are typically distributed via a Worm or a Trojan Horse and this is how they become profitable because of the sheer scalability of their business model.

In a nutshell it looks like we’re going to have to continue to deal with Spam. It’s not going anywhere!

{ 1 comment… read it below or add one }

NetDip 11.10.08 at 4:06 pm


It's those poor conversion rates that necessitate the massive amount of spam sent out. I guess if we would all buy products from spam emails, the spammers wouldn't have to send out so many emails and we'd all receive less spam. So everybody, do your part and buy something from a spam email today!

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