: Mixed Reactions to Fee-Based E-mail

Mixed Reactions to Fee-Based E-mail
By Ed Sutherland
February 6, 2006
URL: Mixed Reactions to Fee-Based E-mail - InternetNews.

Today’s America Online and Yahoo announcement that they plan to levy e-mail sent to their users could double the cost of messages, which could put e-mail correspondence out of the reach for some, according to Matthew Moog, CEO of Q Interactive.

Moog’s CoolSavings marketing service e-mails 10 million people per month.

“The announcement came as a bit of a surprise,” Moog told While the marketing industry has discussed ways to authenticate e-mail, news of a fee to send e-mail caught the executive off-guard.

AOL and Yahoo plan to charge senders of e-mail a fee to avoid junk-mail filters. The e-mail providers are teaming with Goodmail Systems to label approved messages certified. Companies sending mail would promise messages are sent only to those requesting contact.

Moog says the fee, as high as 1 cent per e-mail, translates to $2.50 to $10 per thousand e-mails for companies using his service. While larger businesses will be able to afford the fees, smaller firms and organizations may find it too expensive to keep in touch with AOL and Yahoo accounts. “Others are not going to be able to pay,” Moog said.

Another e-mail marketer, FuseMail, believes charging “postage” for e-mail could hurt AOL and Yahoo users.

“We think this will be problematic to collect fees from millions of e-mail servers around the globe and will ultimately result in upset and frustrated customers of AOL and Yahoo,” said Bryan Heitman, FuseMail’s president.

Moog agrees something must be done to reduce an overload of spam e-mail. “Our only concern is we don’t have to pay what they are asking” without some alternative, he said.

Although Moog believes fees to ensure e-mail delivery will become part of the Internet landscape, he is hoping more options will appear.

One alternative to the one proposed by AOL and Yahoo is Bonded Sender, used by Microsoft’s Hotmail. CoolSavings pays the service $20,000 per year to be identified as non-spam.

“We do not believe the idea of charging a postage fee is the right approach,” according to Heitman. “The better approach is for Yahoo and AOL to tighten their networks using SPF (sender policy framework).”

FuseMail claims less than three e-mails it sends each day are spam.

“There will be little effect on the industry,” says Loren McDonald, vice president of marketing at EmailLabs, a company that distributes messages from publishers.

“The vast majority of e-mail senders won’t participate” in the program, according to McDonald. “Those companies that don’t participate won’t be penalized,” he said.

While the service will ensure larger e-tailers get their messages to consumers, rather than being filtered out, smaller companies won’t be prevented from sending e-mail, according to the marketer.

Concern has arisen whether the service will create two levels of services: one for paying users and one that is free.

“There already is a class system,” said McDonald. For companies where e-mail is their core business, firms are already ensuring their mail is delivered.

Improving the chance your e-mail is delivered is critical, since Yahoo, AOL and Microsoft’s Hotmail account for more than 50 percent of e-mail accounts, according to McDonald.