Jon Christian Ryter -- Toll Charges at the Internet Onramps

TOLL CHARGES AT THE INTERNET ONRAMPS

By Jon Christian Ryter

February 8, 2006

NewsWithViews.com

America On-Line (AOL), utilizing business partner Goodmail Systems will be the first of several ISPs to offer commercial accounts "certified e-mails" that will cost the customer as much as a fourth-of-a-cent to a penny per e-mail, and will ultimately lead to universal "postage stamp" e-mail for bulk mailers. Goodmail, which was the originally the brainchild of Don Hutchinson, founder of @Home, Excite@Home and Work.com became a collaboration that included Scott Kurnit of About.com and Richard Gingras, a pioneer in online services including RealNetworks, Laszlo Systems and 2Wire. Gingras, who serves as the CEO of Goodmail Systems, led the online development of @Home, including the development of the broadband and narrowband portal divisions of Excite@Home. In the early 1990s, Gingras led the development of the eWorld online system of Apple. When he began his Internet career in 1979, Gingras created the first interactive news magazine in partnership with CBS, NBC and PBS. Gingras now serves as the CEO of Goodmail Systems who is now collaborating with several Internet ISPs to create the nation's first paid per piece e-mail delivery system.

Hutchinson, Kurnit, Gingras and several other Internet entrepreneurs�including the US Postal Service�became interested in developing a unique paid form of e-mails that would be accepted by commercial users after the Baby Bells, MCI and AT&T began insisting to their "friends" in Congress (i.e., those whose war chests are filled-to-overflowing with telephone company bribes in the form of campaign contributions) that not only should they receive a stipend from every Internet user since they provide access to the onramps of the information super highway, but they should also be paid by commercial users that send large files to their corporate subscribers�particularly those who send video and music clips and other secure and/or priority data. This would include banks, department stores, or online merchants with security issues.

When the merger issues between cable, telephonic and ISP companies first surfaced during the Clinton years, Senator John McCain, the champion of campaign reform�one of those known to be in the hip pocket of Ma Bell�was called by AT&T who was trying to buy Media One Cable, a company wanting to offer broadband service to Internet users. The FCC effectively blocked AT&T's attempt to get a toehold in either the cable industry or the cyberworld by simply pigeonholing their request. After the call from AT&T, McCain�as Chairman of the Senate Commerce, Science and Transportation Committee which oversees the telecommunications industry�wrote a letter to the FCC instructing them to move forward on the AT&T request.

Less than two weeks later McCain received the "maximum" contribution of $1,000 from each of AT&T's corporate executives. On March 23, 2000, AT&T's lobbyist�and former GOP Congressman Vin Weber�hosted a fund-raiser for McCain's presidential campaign that netted the Arizona senator $120 thousand. Two days later McCain hinted, in a press conference, that he was going to strip the FCC of its authority to regulate mergers in the interest of the free enterprise system. On May 26, McCain introduced legislation to take away the authority of the FCC to approve telecommunications industry mergers�which includes the Internet

While McCain didn't succeed in pulling the teeth of the FCC, he did make the FCC a lot more cautious about getting in the way of telecommunications mergers that opened the door for Ma Bell to start buying up Internet Service Providers and offering broadband service to Internet users themselves. Once Ma Bell was allowed to become an ISP, they spent less effort demanding toll charges for access to the onramp of the information superhighway and more time devising schemes that would allow them to charge everyone for portal to portal delivery�something Congress is determined to block.

The Senate Commerce, Science and Transportation Committee�now chaired by Sen. Ted Stevens [R-AK]�met on Tuesday to head off AOL's plans to offer preferential treatment to paid e-mail mailers (which is the precursor of paid e-mail). The Committee is considering "net neutrality" legislation that will prevent ISPs from giving preferred delivery status to certain providers of content. Stevens said the concern of the committee is that the AOL/Goodmail plan could make it hard for nonpaying e-mailers to reach the recipients of their e-mails, In point of fact, although he didn't say it, the Goodmail program amounts to a form of cyberblackmail. Commercial clients that don't pay will find their e-mails redirected to spam folders. Many of those who agree to pay will do so grudgingly, feeling their payments for "certified" delivery is nothing more than ransom for delivery.

While Verizon, BellSouth and AT&T view a multi-tiered Internet delivery system as the first step in charging "postage" per e-mail regardless who sends it to whom, the executives of many of the companies now leveraging Congress to kill the Goodmail preferred delivery system believe what AOL and Goodmail are doing in creating a "preferred class" of e-mail is merely the first step in charging everyone for everything�or relegating their e-mails to cybergarbage cans.

If Goodmail and their partners have their way, paid e-mails will be viewed as "certified mail"�guaranteed to be virus free. Free commercial e-mails with attachments�3rd class e-mail�simply won't be able to penetrate the firewalls of participating ISPs and will bounce back to the sender undelivered. Free e-mails without attachments�2nd class e-mail�will be delivered to spam folders and the recipient will have to dig through what will likely be construed as garbage to determine if the e-mails that end up there are something they want to open and read. Most people never check their spam folders�they simply delete the trash.

If AOL, Goodmail and the other Goodmail partners�Hotmail, Google, Yahoo, Port 25, Omni TI and StrongMail�get their way, eventually the bulk e-mails from your grassroots friends will all be delivered to your spam folder and your mailbox will be filled with coupons for aluminum siding, auto financing, Wal-mart's latest Chinese gadget, and secure, tamperproof, confirmations from your creditors if you pay your bills online. The only free 1st class e-mails will be those sent from one private party to another single private party. Aunt Sally or Cousin Nick can write you, but e-mails from Bert the Grassroots Advocate will be viewed as spam because Bert probably has a mailing list of 2,000 likeminded conservatives like you. And, of course, your mailing list of 959 likeminded thinkers will be viewed as spam as well.

Ultimately, when you send attachments�particularly those containing large file video or sound bites�even to a private individual�Goodmail plans to assess a cost to "certify" that it's virus-free in order to get it past the firewall of the ISP of the recipient�if either you or the recipient uses AOL, Yahoo or one of the other Goodmail partners or customers providing Congress does not step in quickly and outlaw the practice of preferential delivery systems. Already a step ahead of Congress, AOL-Time Warner claims the new program is completely voluntary. AOL says within the next two months it will begin accepting e-mails processed by Goodmail�who has already tested the system with the participation of several well-known companies including The New York Times and the Red Cross.

Goodmail said that any company can apply for "certification." To qualify, Goodmail said, the company must adhere to pristine e-mail standards. Final approval comes from AOL, Yahoo, or whatever ISP is the client. Goodmail then affixes a digital token to the e-mail that is recognized by the ISP's security defense system, which allows it past the firewall. That mail is then delivered to the intended recipient. AOL said their subscribers still have the ability to block the e-mail from their mailboxes by using their internal spam blockers.

If Congress enacts legislation to prevent the prioritizing of e-mails, it is likely a lawsuit larger than the Ma Bell breakup will end up in federal court. "No one wants Goodmail to set up a tollbooth that makes it cost-prohibitive for legitimate mailers to reach the in-box," Matthew Moog, CEO of Q-Inititive (that operates Cool Savings.com) a mass marketer of cybercoupons. Moog said he was in favor of a system that distinguished between worthwhile mail like his and spam because to receive his coupons you must request them. Moog mails 10 million homes each month. Matt Blumberg of Return Path, a direct marketer from New York said the Goodmail program is "...bad for the industry and its bad for the consumer. It's taxation of the good guys with cash, and it does nothing to help the good guys who can't afford the cost or to deter the bad guys who spam anyway"

Brad Garlinghouse, VP of communications products for Yahoo�which is waiting to see what happens with AOL when they launch the program within the next 60 days�said that making senders pay for each message is only right. "They will be forced to be more discriminating in whom they send e-mails to�which will benefit users." Actually, it will benefit only the ISP which has been trying to figure out how to charge the wayfarers of the information superhighway ever since it was paved with the good intentions of the scientific community that constructed it. Jordan Ayan, CEO of SubscriberMail, a high-tech ISP for media and sports companies, agrees. "[The Goodmail program] takes a system that already works and shoves a stick in the flywheel of communications."

I see just a smidgen of merit to the concept of "certified e-mail" as secure e-mail. Cybercompanies like PayPal, eBay, and several major banks and department stores that do credit card business should seriously consider the Goodmail system�or create their own (which would likely be cost prohibitive for small companies without sophisticated IT divisions) to protect their clients from phishing.

Any Internet company or traditional companies that conduct business over the Internet would be wise to use companies like Goodmail since it will help protect the owner of the credit card from being phished. In addition, it will help Internet consumers recognize genuine e-mails from banks, mortgage companies and other lending institutions and protect them from data thieves offering what appears to be extremely low interest loans when in reality all they are doing is phishing for confidential data that will allow them to steal identities.

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Other than that, Congress needs to act swiftly to enact legislation to prevents ISPs from creating a multi-tiered e-mail system that will allow companies like Goodmail�or the USPS�to determine which e-mails get delivered promptly, and which are relegated to spam folders or, worse, returned to the sender undelivered only because the sender chose not to pay the ISP for a priority delivery system.