Scott Richter talks about spam, spammers, and how he’s making the Internet a better place. Although he’s been called the Spam King, been labeled one of the most prolific spammers in the world by Spamhaus ‘s Registry of Known Spam Operations, and been sued for spamming, Scott Richter calls his business electronic marketing. His company, OptInRealBig.com, sends more than 100 million e-mail messages every day. He is settling a lawsuit filed against him by Microsoft Corp. and the New York State Attorney General. An edited transcript of PC World’s (U.S.) conversation with Richter follows.
PC World: You refer to yourself as a high-volume e-mail marketer but not as a spammer.
Scott Richter: Because we don’t spam. The biggest problem is when people get an e-mail that they think they didn’t sign up for or don’t remember signing up for, and they call it spam. Well, that’s not spam.
PCW: So even when people don’t realize that they signed up to be on an e-mail marketing list, is it their own fault?
Richter: It’s probably confusing to people, but that doesn’t make it spam. People don’t realize when they sign up for sites with free giveaways, free contests, that’s how those sites get members.
PCW: Do you get spam? Regular old run-of-the-mill spam, like everyone else?
Richter: Yeah, I get that, too. And antispam groups should be going after these people who send the messages that you can’t remove yourself from — these are the people that need to be targeted.
PCW: Does it bother you when you get spam?
Richter: No, I just click Delete and remove myself from the mailing lists.
PCW: Do you use a spam filter or spam-blocking software? How do you deal with spam?
Richter: No. I usually just remove myself.
PCW: How does OptInRealBig gather e-mail addresses?
Richter: We have a network of free sites. We have free greeting-card sites, we have a whole variety of sites, and when users sign up, they give us permission to send them e-mail.
PCW: Can they still use the free services if they opt not to receive the e-mail marketing messages?
Richter: Yes.
PCW: And all of your messages have “remove” links?
Richter: Yeah, all our messages are CAN-SPAM compliant. We honor opt-out requests. We take what we do very seriously.
PCW: Has the CAN-SPAM law changed your business?
Richter: No, it’s just added more legitimacy. We believe we were already doing everything correct and legit, but now there’s just some ground to stand on.
PCW: So what do you say to the people who don’t think CAN-SPAM is tough enough, or who think that it is giving people a license to spam?
Richter: I don’t know. That’s their problem, that’s not mine.
PCW: How do you react to people who challenge your business not from a legal standpoint, but from an ethical standpoint?
Richter: There are a lot of people who have a lot of time on their hands. I wish those people would take all that time and help find a cure for cancer, help puppies at the shelter, clean up the highways. I wish they would channel their efforts into what’s more important.
PCW: But you have no ethical quandary with what you do?
Richter: We’re not doing anything wrong. We’re not doing anything that Fortune 500 companies don’t do.
PCW: You’re currently in the process of settling a lawsuit filed against you by Microsoft (Corp.) and the New York State Attorney General last year. Initially, you said you weren’t interested in settling. So what changed?
Richter: We’re settling for a low amount and we’re not admitting that we did anything wrong. We’re not admitting to anything. So it was cheaper than spending millions of dollars fighting a lawsuit for years. We haven’t done anything wrong.
PCW: You also filed a lawsuit against SpamCop (an antispam company that was acquired by security firm Ironport Systems Inc. in 2003).
Richter: We believe that they have a product that’s broken and all we want them to do is fix it. We didn’t sue them about their spam filtering. We sued them about their inaccuracy.
PCW: And their inaccuracy is?
Richter: Who they report complaints to is inaccurate.
PCW: So who do they report their complaints to?
Richter: They just send them out en masse, to whoever they feel like sending it to. It’s just an inaccurate system. And, if you want a company that is a spammer, IronPort is the one. IronPort sells servers that do nothing but send 24 million e-mails a day out of each server.
PCW: It’s been reported that you make US$20,000 a day or as much as US$2 million a month. Is that true?
Richter: You know, I won’t usually talk about what I make; obviously the New York AG probably subpoenaed documents or knew my financials. I don’t really ever discuss that.
PCW: What about the idea of an e-mail tax, or a spam tax? The idea that we all have a few dollars a month added to our ISP bill to deal with our ISP handling the cost of spam?
Richter: That’s not true at all. Has AOL gone up from pricing in the last ten years? It actually went down in price, didn’t it? Look at MSN. When they came out ten years ago, it was US$39.99 a month or US$29.99 a month. And now it’s US$19.99. Prices are going down.
PCW: Actually, in 1996 AOL’s dial-up access cost US$19.95 per month. Today, it’s US$23.90 a month. In 1996, MSN also cost US$19.95 per month for dial-up access. Today it costs US$21.95. So the price of dial-up Internet access has risen.
Richter: Then why do these companies send e-mail to their members marketing their own services?
PCW: You don’t think the price of Internet access would go down even further if there were no spam?
Richter: No. I think all you would have is a bunch of spam-filtering companies out of business.
PCW: So are you saying that you’re not a spammer but perhaps you’re keeping the spam-filtering companies in business?
Richter: Oh, I think the spam-filtering companies need us big time. If e-mail marketing stopped tomorrow, beside the fact that you’d have tons of people out of business online, think about all the spam-filtering companies that would be out of business. This is a billion-dollar-a-year business now.
PCW: But don’t you think that sounds a little bit like tobacco companies keeping doctors or hospitals in business?
Richter: Part of that may be truthful. If a lung cancer clinic is only in business because everybody who smokes has cancer, then that’s true.
PCW: But you don’t think that your job is akin to spreading cancer?
Richter: No. You’re reading what ten free radicals have posted on the Internet. You’re not talking to people we do business with, companies that we’ve helped grow from two employees to 25 employees.
PCW: Can you tell me one of those success stories? What kind of good you do for these companies?
Richter: Yeah, we generate leads and acquisitions for companies. We generate on the average 300,000 leads a month right now — 300,000 orders because of our work, off the Internet. Companies need that service, and companies need that business.
PCW: And what kind of companies are these?
Richter: A whole variety of companies: Coffee companies, home improvement companies, medical companies, psychic companies, cash advance companies, restaurants, cigarette companies, software companies, dating companies, animal companies. I mean, it’s a whole gamut of them. We won’t do business with anybody that’s illegal. Anybody that has a product and wants to market it online.
We’re no different than a search engine. You go to a search engine, you type in what you’re looking for, and it gives you links that are free and on the side it gives you companies that have paid for sponsorship. We’re no different. People come to us and we send out e-mail about different products. If you sign up for our lists, we send you e-mail that people have paid us to send you. We’re more like a TV commercial. You don’t know what’s going to pop up next.
PCW: Has your reputation taken any sort of hit from the way you’ve become such a vocal figure?
Richter: No, the only change is that now I’m more of a media celebrity.
PCW: It’s been said that your goal is to be a media celebrity.
Richter: You know, I’m going to give the public what they want. I enjoy what I do, I like the business. If the antispammers didn’t harass me so much I probably would have retired by now. But you know what, that’s what gives me my drive to keep going.
PCW: Do you think too much attention is paid to spam?
Richter: One thing that really ticks me off right now is the FBI, that they have 100 agents or computer specialists working on spam e-mail. Every day, all you hear about is a terrorist attack, about when it’s going to happen. They pulled 100 agents off terrorist attacks for spam e-mail? What if another 5,000 people die in a major devastation or even worse? How can they justify it? “The good news is, we found a spammer”? I sure hope that when a national disaster hits again, that the FBI feels good that we have 100 agents working e-mail.
PCW: So do you think the whole spam thing has just been way overblown?
Richter: Oh, it is. There are simple solutions to it. We’re looking at launching a filtering product. Look at these filtering companies, at Brightmail (Inc.). (Symantec Corp. is paying US$370) million for a company with US$26 million in revenue. Who’d pay 16 times earnings for a company? They’ve got to be nuts. But I tell you, if anybody could figure out how to come up with one of the best filtering products out there, it’s probably somebody who’s been in the business.
PCW: Is that in your future, a spam filter?
Richter: We’re getting a lot of offers with filtering companies right now.
PCW: Anything firm that you can talk about?
Richter: No. Everything’s under nondisclosure.
PCW: Is there anything you want people to know about your company? Richter: We’re not the reason that spam is an issue. People can opt out of our lists. We’re not the people who send you the Viagra ad, with Viagra spelled 12 different ways. We’re not the people who won’t let you ever opt out. We’re out to make the Internet a better place with e-mail marketing.