The company's most high-profile lawsuit -- filed in December 2003 against Colorado bulk e-mailer Scott Richter -- is still pending. But that litigation is unlikely to bring the $18 million judgment Microsoft boasted it would seek. Last summer, New York Attorney General Eliot Spitzer settled a parallel lawsuit against Richter for the paltry sum of $50,000.

In August 2003, Microsoft found itself in the embarrassing position of having to apologize to a British man after erroneously suing him for spamming. In a statement, Microsoft said the case against Simon Grainger "illustrates the difficulties and hazards of investigating the clandestine activities of faceless individuals operating on the Internet."

Microsoft lobbed an innovative lawsuit last September at Levon Gillespie, the operator of a company that provides "bulletproof" Web site hosting services to spammers. Soon thereafter, Gillespie's Cheapbulletproof.com site went offline, as did SpamForum.biz, his online marketplace for junk e-mailers. But earlier this month, Gillespie's sites returned, now located on servers in China. A Microsoft spokesperson reports that the lawsuit is still in the discovery stage.

Anti-spam legal efforts can get results without making headlines, says Matthew Prince, an adjunct professor of law at John Marshall Law School, and chief executive of Unspam. If nothing else, Microsoft can force spammers to run up big legal bills, thereby wrecking the economics of spamming, says Prince.

Spam opponents see other behind-the-scenes opportunities for Microsoft. The company could use its enormous marketplace clout to pressure the biggest suppliers of Web site hosting for spammers.

Steve Linford, operator of the Spamhaus spam-filtering and information clearinghouse, says Microsoft's Hotmail service could threaten to block e-mail from China unless the Chinese government pressures rogue ISPs there to stop providing havens for spam suppliers such as Gillespie.

"AOL gets an enormous amount done simply by telling other providers that they won't accept e-mail from their systems unless they clean up their networks. Microsoft most certainly could use Hotmail as leverage in this same way," says Linford.

Similarly, Microsoft could shame MCI Wholesale Network Services, which currently hosts around 200 spam gangs, according to Linford.

Microsoft's anti-spam initiatives may be hampered, however, by what Prince and other experts describe as the firm's split personality over junk e-mail. Microsoft's MSN and Hotmail services appear determined to run spammers off their networks on a rail. But the company's other business units want to preserve Microsoft's ability to use unsolicited e-mail in, for example, cross-marketing to existing customers.

"AOL has a much clearer sense that spam is a problem that's unacceptable, and they are willing to go to the mat to solve it, whereas Microsoft is definitely of two minds on the subject," says Prince.

So even while Microsoft is an "impressive partner" in some anti-spam enforcements, according to Paula Selis, senior counsel for the Washington state attorney general's office, at the same time the company has lobbied for weaker versions of federal and state spam laws.

"It's struck me that sometimes their agenda is a little mixed," says Selis.

State lawmakers have publicly criticized Microsoft's aggressive lobbying against stringent anti-spam laws. After the company helped to defeat a do-not-spam registry proposal in Michigan, some legislators began referring to Microsoft as the "axis of inertia" in the press.

Microsoft's conflicted spam priorities are also blamed for a recent breakdown in setting e-mail authentication standards. Last summer, an international working group was close to hammering out a standard based on Microsoft technology, which would help in the battle against spam, viruses and other e-mail abuse.

But the working group hit a roadblock when Microsoft revealed that it had applied to patent its authentication technology, known as Sender ID. Some working-group participants balked at the idea of Microsoft's patent lawyers controlling an industry standard.

Levine says Microsoft could have offered a license that satisfied the open-source community without compromising its intellectual property protections. But the company made no such concession.

"Their best offer was a license that gives them the option to pull the rug out at any time, with vague assurances that they wouldn't do that," says Levine. As a result, the working group was disbanded in September without reaching an agreement.

Using its proprietary SmartScreen filtering technology, Microsoft's Hotmail service has made great progress in shielding users from spam. Indeed, Microsoft's best hope of defeating spam by 2006 may be within its own networks, if not the Internet at large, says Prince.

That's a long way to come for a service that, four years ago, was blacklisted by the Mail Abuse Prevention System for improperly securing its servers against spammers.

But recent organizational moves suggest Microsoft's priorities may have shifted away from a single-minded commitment to fighting unsolicited commercial e-mail.

The Microsoft Anti-Spam Technology and Strategy Group, created in 2002, was recently renamed the Safety Technology and Strategy Group. According to a Microsoft spokesperson, the company changed the name as a result of its taking a new view of spam as part of a broader problem of online safety that includes "phishing" attacks.

"To beat spammers, you've got to be unrelenting, and chase them 24 hours a day, 365 days a year," says Prince. He worries that Microsoft's broader focus might divert the company's attention from that task.

For Microsoft to play a leading role in solving the spam problem, it must ultimately rein in its own marketing for the sake of being a good netizen, says Levine.

"Compared to other big companies, Microsoft's anti-spam activities look far more to be shaped by their business interests. The other big players are doing things that are certainly good for themselves, but they're also good for the Internet community as a whole," says Levine.

Regardless of whether Microsoft makes such a commitment, Stewart puts the probability of a spam-free Internet by 2006 next to zero.

"The spammers are making big money at this game right now. There's no way they're just going to stop and say, 'Gee, Microsoft has introduced the final, ultimate solution to stop spam. Guess we should give up now.'"

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