In reading about the proposal about charging for email delivery by Yahoo and AOL, I thought about a recent article written by Umair Haque on The Economics of Free. In this article, Umair states that the Free Culture had unintended consequences for firms providing free services, that there was a segment of the population where there was a negative benefit for providing services for free.  Umair made this proposal:

Now, of course, there is a model which remedies this situation. It requires a shift to Semi-Free. The concept is simple: those consumers whom the firm doesn’t want to trade nonfinancial benefits with in exchange for the right to use it’s service must pay financially. This way, firms optimize the value they capture from the full population of potential consumers. Free consumers give them nonfinancial benefits; non-Free user give them financial benefits. Barriers to consumption fall, the pie expands, and everyone’s happy.

Umair is looking at this issue from the prospective of the producer. I think the same logic can be applied to the consumers. I think this Semi-Free model would be a great way to describe the email stamp that Seth talks about.  Paraphrasing Umair’s words: “

Those producers (email senders) whom the consumer doesn’t want to trade nonfinancial benefits with in exchange for the right to receive their service (email) must pay financially (email Stamp).

If the cost of sending one email is next to nothing and the cost of sending a million emails is incrementally negligible, conversion rates have to be miniscule to justify an ROI, hence the spam tsunami.  The consumer is inundated with an excess supply of emails with inconsequential value, and actually raises the transaction cost for the consumer to get the information and emails that have real value for them.

Free email distribution leads to the unintended consequences of higher transaction costs for the consumer.  A Semi-Free model transfers some of that transaction cost from the consumer to the business that sends the email.  It helps, in Seth’s words, to “add friction” which raises the ROI threshold for the emailer.

The Anti-Spam lobby  and others that are opposing this  are making the wrong choice in fighting this.   I should know, I was part of the Telemarketing industry and watched it take the wrong approach to the Do Not Call legislation.  I agree with Seth and with Calacanis  that an email tax is the way to salvage email.

Of course, I think the integration of RSS aggregators into Outlook and other email services will be the ultimate spam killer and take us to a spam free utopia.