Mitigating the Tragedy Of the Digital Commons: The Problem of Unsolicited Commercial E-Mail

The growth of unsolicited commercial email (UCE) imposes increasing costs on organizations and causes considerable aggravation on the part of email recipients. A thriving anti-spam industry addresses some of the frustration. Regulation and various economic and technical means are in the works – all aimed at bringing down the flood of unwanted commercial email. This paper contributes to our understanding of the UCE phenomenon by drawing on scholarly work in areas of marketing and resource ownership and use. Adapting the tragedy of the commons to the email context, we identify a causal structure that drives the direct e-marketing industry. Computer simulations indicate that although filtering may be an effective method to curb UCE arriving at individual inboxes, it is likely to increase the aggregate volume, thereby boosting overall costs. We also examine other response mechanisms, including self-regulation, government regulation, and market mechanisms. The analysis advances understanding of the digital commons, the economics of UCE, and has practical implications for the direct e-marketing industry. Introduction Computer-mediated communication has become one of the accepted channels in the mix of outlets that modern companies rely on to advertise their products (Figure 1). Electronic mail (email) advertising had nearly a billion dollars in revenue in 2001 and is predicted to reach several billion dollars within a few years (Martin, Durme et al. 2003). Reputable commercial establishments, such as J.C. Penney, Barnes and Noble, and Borders use email for communicating with customers (Martin, Durme et al. 2003). The marketing industry’s search for an optimal portfolio of online and traditional advertising (Kover 1999; Sheehan and Doherty 2001) will eventually evolve into integrated marketing communication programs (Brackett and Carr 2001). A cleverly designed direct marketing campaign contributes to overall sales (Chiang, Chhajed et al. 2003). Email is more attractive than regular mail due to its lower mailing * Corresponding author. Address: WPI, 100 Institute Road, Worcester, MA 01609. Email: [email protected]