Silicon Valley is continuing to hemorrhage thousands of jobs, but there are some here who say that the time has never been better for creating a startup company.
On Monday, Phil Goldman, whose career as a software designer has included stints at Apple, General Magic, WebTV and Microsoft, will introduce a service that he says will permanently end e-mail spam for consumers who are being driven to distraction by unsolicited pitches for diet schemes and offers of great wealth from Nigeria.
Goldman, 38, who is self-financing his company, Mailblocks, said that the falling cost of new technologies and the slumping technology economy are making it relatively easy to enter new markets.
"It's incredibly inexpensive to buy computers, and network bandwidth is essentially free and there is surplus equipment," he said. At the same time, innovation has been frozen because Silicon Valley's venture capitalists are largely sitting on the sidelines.
"It's like a guy crawling in the desert who sees the oasis, but who can't quite get there," he said.
Mailblocks, based in Los Altos, Calif., is entering the crowded e-mail market with the premise that consumers will pay a small annual fee for a solution to spam.
The consumer e-mail market is currently dominated by Yahoo, Hotmail and America Online, which provide free basic services that are supported through advertising.
There are also already dozens of commercial add-in products that try to recognize and block spam.
Moreover, Internet service providers in recent months have begun to make new efforts to respond to growing consumer frustration with spam.
In addition to legislative proposals before Congress and state legislatures, there are efforts under way within the direct marketing industry to try to deal with spam. And last week, the Internet Engineering Taskforce, a committee of technology experts that sets Internet standards, met in San Francisco to listen to proposals for technical solutions to spam.
The Mailblocks antispam service is based on a so-called challenge-response mechanism to block bulk mail sent automatically to e-mail accounts. When a customer receives a new message from an unknown correspondent, the system will intercept the message and automatically return to the sender a digital image of a seven-digit number and a form to fill out. Once a human being views that number and types it into the form -- demonstrating that he or she is a person and not an automated mass-mailing machine -- the system will forward the e-mail to the intended recipient.
International Data Corp, a research house, estimates that there are about 700 million electronic mailboxes in the world and that the number will grow to 1.2 billion in 2005.
"It's a really nice product, and it's pretty easy to use," said Jim Nail, a senior analyst at Forrester Research, a computer and communications industry research firm.
"The question is how big a market. Do people want to pay anybody anything for these features?"
Goldman said he was trying to imitate the strategy of Google, the dominant Web search engine company, which entered its market late but quickly became the leading service in its field because it provides useful Web searches.
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