Pelted from one side by irate beta testers, Cloudmark is also taking hits on the other side from industry analysts who question whether the crowded market for spam-blocking tools and services can support a revenue model reliant on consumer subscriptions.
The Cloudmark fee controversy comes years into a push by Internet companies from small start-ups to major media conglomerates to convert their free offerings to paid services. It also coincides with efforts by some companies, including Yahoo, to capitalize on the spam quagmire by offering premium spam-blocking services along with basic free ones.
The decision by Cloudmark to charge $3.99 per month for SpamNet, its collaborative spam-blocking service, caught members off guard. The system, which blocks unsolicited commercial e-mail based on what messages users report,.
Whether Cloudmark promised that it would remain free remains a bone of contention between the management and beta testers.
"Cloudmark prided itself on being 100 percent free, and free forever," Dwight Zenzano, a technology consultant with CadenceQuest in Washington, D.C., wrote in an e-mail interview. "It is us, the hard-working beta testers and users of the SpamNet client that make the product so effective, and now they plan to charge us? As a 'gesture,' Cloudmark has said that all beta testers can use the product for only $1.99/month. That is still crazy, as we were promised a free product forever."
Cloudmark, which boasts 440,000 users, has now offered beta testers both the $1.99 discounted monthly fee for SpamNet 1.0 and the option to keep using the beta version at no cost. And executives who have been playing damage control on the company's message boards, where irate users have been venting their complaints, insist that Cloudmark was clear from the beginning that it would one day charge for its services.
"It has always been our plan to charge for SpamNet, and this can be seen from our first press releases--posted on this site," wrote, Cloudmark's vice president of product development, in response to a user's complaint.
Free or fee?
Cloudmark's first press release, issued in June, says "the beta version of SpamNet is available for free," and makes no mention of charging for future versions. At the time, the company told CNET News.com that it would keep a version of the consumer product free, making money by charging for a more advanced version and an enterprise version. The enterprise product launched in November under the name Authority.
A December press release says the company planned a paid version this year.
Edelstein denied that the company had engaged in a game of bait-and-switch with beta testers, affirming that the beta version would remain free. He attributed complaints of reduced effectiveness of the beta version to testers' "heightened sensitivity to day-to-day fluctuations in accuracy," adding that the beta and the finished product were not yet substantially different.
But those who opt to stick with the free beta should expect a quality gap to open as time goes by, Edelstein warned.
"At this time, the algorithms in the beta are identical to those in 1.0," Edelstein said in an interview. "But as we develop new algorithms, we're not going to put them back into the beta. The product is going to continue to advance and get better."
Edelstein said the company hadn't determined whether betas for future versions would be offered free of charge.
Some people question whether Cloudmark can successfully charge for its services when it faces so much free and low-cost competition.
"In an era where most Internet users expect e-mail for free, charging money to keep the e-mail spam-free may not fly," Ray Everett-Church, an attorney and chief privacy officer with ePrivacy Group, a privacy consultancy based in Philadelphia, wrote in an e-mail interview. But, he said, "I, for one, would happily pay if the only alternative is to have the product go away."
Edelstein blasted his free and low-cost competition and cited a recent PC Magazine review that gave SpamNet three out of five stars and said it had the "highest rate of spam detection among the products we tested, and relatively few false positives."
"We basically kick butt on our shrink-wrapped competitors," said Edelstein. "Spam is an ongoing war, not a single battle...so the concept of buying a single product doesn't work: You buy it and it immediately begins to degrade. If you pay $9.95 at CompUSA, you're going to get what you pay for."