Melania Trump Club

Tuesday, November 30, 2010

Dot-com bubble

The "dot-com bubble" (or sometimes "IT bubble" or "TMT bubble") was a speculative bubble covering roughly 1995–2000 (with a climax on March 10, 2000 with the NASDAQ peaking at 5132.52 in intraday trading before closing at 5048.62) during which stock markets in industrialized nations saw their equity value rise rapidly from growth in the more recent Internet sector and related fields. While the latter part was a boom and bust cycle, the Internet boom sometimes is meant to refer to the steady commercial growth of the Internet with the advent of the world wide web as exemplified by the first release of the Mosaic web browser in 1993 and continuing through the 1990s.
The period was marked by the founding (and, in many cases, spectacular failure) of a group of new Internet-based companies commonly referred to as dot-coms. Companies were seeing their stock prices shoot up if they simply added an "e-" prefix to their name and/or a ".com" to the end, which one author called "prefix investing."
A combination of rapidly increasing stock prices, market confidence that the companies would turn future profits, individual speculation in stocks, and widely available venture capital created an environment in which many investors were willing to overlook traditional metrics such as P/E ratio in favor of confidence in technological advancements.

Bubble growth

The venture capitalists saw record-setting as companies rises in stock valuations of dot-com companies, and therefore moved faster and with less caution than usual, choosing to mitigate the risk by starting many contenders and letting the market decide which would succeed. The low interest rates in 1998–99 helped increase the start-up capital amounts. Although a number of these new entrepreneurs had realistic plans and administrative ability, many more of them lacked these characteristics but were able to sell their ideas to investors because of the novelty of the dot-com concept. 
A canonical "dot-com" company's business model relied on harnessing network effects by operating at a sustained net loss to build market share (or mind share). These companies offered their services or end product for free with the expectation that they could build enough brand awareness to charge profitable rates for their services later. The motto "get big fast" reflected this strategy. During the loss period the companies relied on venture capital and especially initial public offerings of stock to pay their expenses while having no source of income at all. The novelty of these stocks, combined with the difficulty of valuing the companies, sent many stocks to dizzying heights and made the initial controllers of the company wildly rich on paper.
Historically, the dot-com boom can be seen as similar to a number of other technology-inspired booms of the past including railroads in the 1840s, automobiles and radio in the 1920s and transistor electronics in the 1950s.

Soaring stocks

In financial markets, a stock market bubble is a self-perpetuating rise or boom in the share prices of stocks of a particular industry. The term may be used with certainty only in retrospect when share prices have since crashed. A bubble occurs when speculators note the fast increase in value and decide to buy in anticipation of further rises, rather than because the shares are undervalued. Typically many companies thus become grossly overvalued. When the bubble "bursts," the share prices fall dramatically, and many companies go out of business.
The dot-com model was inherently flawed: a vast number of companies all had the same business plan of monopolizing their respective sectors through network effects, and it was clear that even if the plan were sound, there could only be one network-effects winner in each sector, and therefore that most companies with this business plan would fail. In fact, many sectors could not support even one company powered entirely by network effects.
In spite of this, however, a few company founders made vast fortunes when their companies were bought out at an early stage in the dot-com stock market bubble. These early successes made the bubble even more buoyant. An unprecedented amount of personal investing occurred during the boom, and the press reported the phenomenon of people quitting their jobs to become full-time day traders.

Free spending

According to dot-com theory, an Internet company's survival depended on expanding its customer base as rapidly as possible, even if it produced large annual losses. For instance, Google and Amazon did not see any profit in their first years. Amazon was spending on expanding customer base and letting people know that it existed and Google was busy spending on creating more powerful machine capacity to serve its expanding search engine. The phrase "Get large or get lost" was the wisdom of the day. At the height of the boom, it was possible for a promising dot-com to make an initial public offering (IPO) of its stock and raise a substantial amount of money even though it had never made a profit — or, in some cases, earned any revenue what so ever. In such a situation, a company's lifespan was measured by its burn rate: that is, the rate at which a non-profitable company lacking a viable business model ran through its capital served as the metric.
Public awareness campaigns were one of the ways in which dot-coms sought to expand their customer base. These included television ads, print ads, and targeting of professional sporting events. Many dot-coms named themselves with onomatopoeic nonsense words that they hoped would be memorable and not easily confused with a competitor. Super Bowl XXXIV in January 2000 featured seventeen dot-com companies that each paid over two million dollars for a thirty-second spot. By contrast, in January 2001, just three dot-coms bought advertising spots during Super Bowl XXXV. In a similar vein, CBS-backed iWon.com gave away ten million dollars to a lucky contestant on an April 15, 2000 half-hour primetime special that was broadcast on CBS.
Not surprisingly, the "growth over profits" mentality and the aura of "new economy" invincibility led some companies to engage in lavish internal spending, such as elaborate business facilities and luxury vacations for employees. Executives and employees who were paid with stock options instead of cash became instant millionaires when the company made its initial public offering; many invested their new wealth into yet more dot-coms.
Cities all over the United States sought to become the "next Silicon Valley" by building network-enabled office space to attract Internet entrepreneurs. Communication providers, convinced that the future economy would require ubiquitous broadband access, went deeply into debt to improve their networks with high-speed equipment and fiber optic cables. Companies that produced network equipment like Nortel Networks were irrevocably damaged by such over-extension; Nortel declared bankruptcy in early 2009. Companies like Cisco, which did not have any production facilities, but bought from other manufacturers, were able to leave quickly and actually do well from the situation as the bubble burst and products were sold cheaply.
Similarly, in Europe the vast amounts of cash the mobile operators spent on 3G licences in Germany, Italy, and the United Kingdom, for example, led them into deep debt. The investments were far out of proportion to both their current and projected cash flow, but this was not publicly acknowledged until as late as 2001 and 2002. Due to the highly networked nature of the IT industry, this quickly led to problems for small companies dependent on contracts from operators.
The bubble bursts


The technology-heavy NASDAQ Composite index peaked at 5,048 in March 2000, reflecting the high point of the dot-com bubble.
Over 1999 and early 2000, the U.S. Federal Reserve increased interest rates six times, and the economy began to lose speed. The dot-com bubble burst, numerically, on Friday, March 10, 2000, when the technology heavy NASDAQ Composite index, peaked at 5,048.62 (intra-day peak 5,132.52), more than double its value just a year before. The NASDAQ fell slightly after that, but this was attributed to correction by most market analysts; the actual reversal and subsequent bear market may have been triggered by the adverse findings of fact in the United States v. Microsoft case which was being heard in federal court. The findings, which declared Microsoft a monopoly, were widely expected in the weeks before their release on April 3.
One possible cause for the collapse of the NASDAQ (and all dot-coms that collapsed) was the massive, multi-billion-dollar sell orders for major bellwether high tech stocks (Cisco, IBM, Dell, etc.) that happened by chance to be processed simultaneously on the Monday morning following the March 10 weekend. This selling resulted in the NASDAQ opening roughly four percentage points lower on Monday March 13 from 5,038 to 4,879—the greatest percentage 'pre-market' selloff for the entire year.
The massive initial batch of sell orders processed on Monday, March 13 triggered a chain reaction of selling that fed on itself as investors, funds, and institutions liquidated positions. In just six days the NASDAQ had lost nearly nine percent, falling from roughly 5,050 on March 10 to 4,580 on March 15.
Another reason may have been accelerated business spending in preparation for the Y2K switchover. Once New Year had passed without incident, businesses found themselves with all the equipment they needed for some time, and business spending quickly declined. This correlates quite closely to the peak of U.S. stock markets. The Dow Jones peaked on January 14, 2000 (closed at 11,722.98) and the broader S&P 500 on March 24, 2000 (closed at 1,527.46); while, even more dramatically the UK's FTSE 100 Index peaked at 6,950.60 on the last day of trading in 1999 (December 30). Hiring freezes, layoffs, and consolidations followed in several industries, especially in the dot-com sector.
The bursting of the bubble may also have been related to the poor results of Internet retailers following the 1999 Christmas season.[citation needed] This was the first unequivocal and public evidence that the "get-rich-quick" Internet strategy was flawed for most companies. These retailers' results were made public in March when annual and quarterly reports of public firms were released.
By 2001 the bubble was deflating at full speed. A majority of the dot-coms ceased trading after burning through their venture capital, many having never made a ″net″ profit. Investors often referred to these failed dot-coms as "dot-bombs."

Aftermath

On January 11, 2000, America Online, a favorite of dot-com investors and pioneer of dial-up Internet access, acquired Time Warner, the world's largest media company. The transaction has been described as "the worst in history". Within two years, boardroom disagreements drove out both of the CEOs who made the deal, and in October 2003 AOL Time Warner dropped "AOL" from its name.
Several communication companies could not weather the financial burden and were forced to file for bankruptcy. One of the more significant players, WorldCom, was found practicing illegal accounting practices to exaggerate its profits on a yearly basis. WorldCom's stock price fell drastically when this information went public and eventually filed the third largest corporate bankruptcy in U.S. history. Other examples include NorthPoint Communications, Global Crossing, JDS Uniphase, XO Communications, and Covad Communications. Companies such as Nortel, Cisco and Corning, were at a disadvantage because they relied on infrastructure that was never developed which caused the stock of Corning to drop significantly.
Many dot-coms ran out of capital and were acquired or liquidated; the domain names were picked up by old-economy competitors or domain name investors. Several companies and their executives were accused or convicted of fraud for misusing shareholders' money, and the U.S. Securities and Exchange Commission fined top investment firms like Citigroup and Merrill Lynch millions of dollars for misleading investors. Various supporting industries, such as advertising and shipping, scaled back their operations as demand for their services fell. A few large dot-com companies, such as Amazon.com and eBay, survived the turmoil and appear assured of long-term survival, while others such as Google have become industry-dominating mega-firms.
The Stock Market Crash of 2000-2002 caused the loss of $5 trillion in the market value of companies from March 2000 to October 2002. The 9/11 terrorist destruction of the World Trade Center's Twin Towers, killing almost 700 employees of Cantor-Fitzgerald, accelerated the stock market drop; the NYSE suspended trading for four sessions. When trading resumed, some of it was transacted in temporary new locations.
More in-depth analysis shows that 50% of the dot-coms companies survived through 2004. With this, it is safe to assume that the assets lost from the Stock Market do not directly link to the closing of firms. More importantly, however, it can be concluded that even companies who were categorized as the "small players" were adequate enough to endure the destruction of the financial market during 2000-2002.
Nevertheless, laid-off technology experts, such as computer programmers, found a glutted job market. In the U.S., International outsourcing and the recently allowed increase of skilled visa "guest workers" (e.g., those participating in the U.S. H-1B visa program) exacerbated the situation. University degree programs for computer-related careers saw a noticeable drop in new students. Anecdotes of unemployed programmers going back to school to become accountants or lawyers were common.

The transition of the bubbles


Some believe the crash of the dot-com bubble metastatized into the housing bubble in the U.S.
Yale economist Robert Shiller said in 2005, “Once stocks fell, real estate became the primary outlet for the speculative frenzy that the stock market had unleashed. Where else could plungers apply their newly acquired trading talents? The materialistic display of the big house also has become a salve to bruised egos of disappointed stock investors. These days, the only thing that comes close to real estate as a national obsession is poker.”
Ralph Block wrote in 2005: "Many baby boomers appear to have decided that the stock market won’t provide them with sufficient assets with which to retire, and have taken advantage of “hot” real estate markets and low (e.g., 5 percent) down payments to speculate in residential real estate. The number of homes bought for investment jumped 50 percent during the four year period ending in 2004, according to the San Francisco research firm LoanPerformance."
However, the housing bubble transformed into the current full scale subprime mortgage crisis which started in late 2007.

List of companies significant to the bubble

For discussion and a list of dot-com companies outside the scope of the dot-com bubble, see dot-com company.
Boo.com, spent $188 million in just six months in an attempt to create a global online fashion store. Went bankrupt in May 2000.
Startups.com was the "ultimate dot-com startup." Went out of business in 2002.
e.Digital Corporation (EDIG): Long term unprofitable OTCBB traded company founded in 1988 previously named Norris Communications. Changed its name to e.Digital in January 1999 when stock was at $0.06 level. The stock rose rapidly in 1999 and went from closing price of $2.91 on December 31, 1999 to intraday high of $24.50 on January 24, 2000. It quickly retraced and has traded between $0.08 and $0.20 in 2008 and 2009.
Freeinternet.com – Filed for bankruptcy in October 2000, soon after canceling its IPO. At the time Freeinternet.com was the fifth largest ISP in the United States, with 3.2 million users. Famous for its mascot Baby Bob, the company lost $19 million in 1999 on revenues of less than $1 million.
GeoCities, purchased by Yahoo! for $3.57 billion in January 1999. Yahoo! closed GeoCities on October 26, 2009.
theGlobe.com – Was a social networking service, that went live in April 1995 and made headlines by going public on November 1998 and posting the largest first day gain of any IPO in history up to that date. The CEO became in 1999 a visible symbol of the excesses of dot-com millionaires.
GovWorks.com – the doomed dot-com featured in the documentary film Startup.com.
Hotmail – founder Sabeer Bhatia sold the company to Microsoft for $400 million; at that time Hotmail had 9 million members.
open.com - Was a big software security producer, reseller and distributor, declared in bankruptcy in 2001.
InfoSpace – In March 2000 this stock reached a price $1,305 per share, but by April 2001 its price had crashed down to $22 a share.
lastminute.com, whose IPO in the U.K. coincided with the bursting of the bubble.
The Learning Company, bought by Mattel in 1999 for $3.5 billion, sold for $27.3 million in 2000.
Think Tools AG, one of the most extreme symptoms of the bubble in Europe: market valuation of CHF 2.5 billion in March 2000, no prospects of having a substantial product (investor deception), followed by a collapse.
Xcelera.com, a Swedish investor in start-up technology firms. "greatest one-year rise of any exchange-listed stock in the history of Wall Street."


(source:wikipedia)

Simple Mail Transfer Protocol

Simple Mail Transfer Protocol (SMTP) is an Internet standard for electronic mail (e-mail) transmission across Internet Protocol (IP) networks. SMTP was first defined by RFC 821 (STD 10) (1982), and last updated by RFC 5321 (2008) which includes the extended SMTP (ESMTP) additions, and is the protocol in widespread use today. SMTP is specified for outgoing mail transport and uses TCP port 25. The protocol for new submissions is effectively the same as SMTP, but it uses port 587 instead.
While electronic mail servers and other mail transfer agents use SMTP to send and receive mail messages, user-level client mail applications typically use only SMTP for sending messages to a mail server for relaying. For receiving messages, client applications usually use either the Post Office Protocol (POP) or the Internet Message Access Protocol (IMAP) or a proprietary system (such as Microsoft Exchange or Lotus Notes/Domino) to access their mail box accounts on a mail server.

History

Various forms of one-to-one electronic messaging were used in the 1960s. People communicated with one another using systems developed for specific mainframe computers. As more computers were interconnected, especially in the US Government's ARPANET, standards were developed to allow users using different systems to be able to e-mail one another. SMTP grew out of these standards developed during the 1970s.
SMTP can trace its roots to two implementations described in 1971, the Mail Box Protocol, which has been disputed to actually have been implemented, but is discussed in RFC 196 and other RFCs, and the SNDMSG program, which, according to RFC 2235, Ray Tomlinson of BBN "invents" for TENEX computers the sending of mail across the ARPANET. Fewer than 50 hosts were connected to the ARPANET at this time.
Further implementations include FTP Mail  and Mail Protocol, both from 1973.Development work continued throughout the 1970s, until the ARPANET converted into the modern Internet around 1980. Jon Postel then proposed a Mail Transfer Protocol in 1980 that began to remove the mail's reliance on FTP. SMTP was published as RFC 821 in August 1982, also by Postel.
The SMTP standard was developed around the same time as Usenet, a one-to-many communication network with some similarities.
SMTP became widely used in the early 1980s. At the time, it was a complement to Unix to Unix Copy Program (UUCP) mail, which was better suited to handle e-mail transfers between machines that were intermittently connected. SMTP, on the other hand, works best when both the sending and receiving machines are connected to the network all the time. Both use a store and forward mechanism and are examples of push technology. Though Usenet's newsgroups are still propagated with UUCP between servers, UUCP mail has virtually disappeared along with the "bang paths" it used as message routing headers.
The article about sender rewriting contains technical background info about the early SMTP history and source routing before RFC 1123.
Sendmail was one of the first (if not the first) mail transfer agents to implement SMTP.[citation needed] Some other popular SMTP server programs include Postfix, qmail, Novell GroupWise, Exim, Novell NetMail, Microsoft Exchange Server, Sun Java System Messaging Server.
Message submission (RFC 2476) and SMTP-AUTH (RFC 2554) were introduced in 1998 and 1999, both describing new trends in e-mail delivery. Originally, SMTP servers were typically internal to an organization, receiving mail for the organization from the outside, and relaying messages from the organization to the outside. But as time went on, SMTP servers (Mail transfer agents), in practice, were expanding their roles to become message submission agents for Mail user agents, some of which were now relaying mail from the outside of an organization. (e.g. a company executive wishes to send e-mail while on a trip using the corporate SMTP server.) This issue, a consequence of the rapid expansion and popularity of the World Wide Web, meant that SMTP had to include specific rules and methods for relaying mail and authenticating users to prevent abuses such as relaying of unsolicited e-mail (spam).
As this protocol started out purely ASCII text-based, it did not deal well with binary files. Standards such as Multipurpose Internet Mail Extensions (MIME) were developed to encode binary files for transfer through SMTP. Mail transfer agents (MTAs) developed after Sendmail also tended to be implemented 8-bit-clean, so that the alternate "just send eight" strategy could be used to transmit arbitrary text data (in any 8-bit ASCII-like character encoding) via SMTP. 8-bit-clean MTAs today tend to support the 8BITMIME extension, permitting binary files to be transmitted almost as easily as plain text.
Many people contributed to the core SMTP specifications, among them Jon Postel, Eric Allman, Dave Crocker, Ned Freed, Randall Gellens, John Klensin, and Keith Moore.

Mail processing model



Blue arrows can be implemented using SMTP variations.
The overall flow for message creation, mail transport, and delivery may be illustrated as shown.
Email is submitted by a mail client (MUA, mail user agent) to a mail server (MSA, mail submission agent) using SMTP on TCP port 587. Most mailbox providers still allow submission on traditional port 25. From there, the MSA delivers the mail to its mail transfer agent (MTA, mail transfer agent). Often, these two agents are just different instances of the same software launched with different options on the same machine. Local processing can be done either on a single machine, or split among various appliances; in the former case, involved processes can share files; in the latter case, SMTP is used to transfer the message internally, with each host configured to use the next appliance as a smart host. Each process is an MTA in its own right; that is, an SMTP server.
The boundary MTA has to locate the target host. It uses the Domain name system (DNS) to look up the mail exchanger record (MX record) for the recipient's domain (the part of the address on the right of @). The returned MX record contains the name of the target host. The MTA next looks up the A record for that name in order to get the IP address and connect to such host as an SMTP client. (The article on MX record discusses many factors in determining which server the sending MTA connects to.)
Once the MX target accepts the incoming message, it hands it to a mail delivery agent (MDA) for local mail delivery. An MDA is able to save messages in the relevant mailbox format. Again, mail reception can be done using many computers or just one —the picture displays two nearby boxes in either case. An MDA may deliver messages directly to storage, or forward them over a network using SMTP, or any other means, including the Local Mail Transfer Protocol (LMTP), a derivative of SMTP designed for this purpose.
Once delivered to the local mail server, the mail is stored for batch retrieval by authenticated mail clients (MUAs). Mail is retrieved by end-user applications, called email clients, using Internet Message Access Protocol (IMAP), a protocol that both facilitates access to mail and manages stored mail, or the Post Office Protocol (POP) which typically uses the traditional mbox mail file format or a proprietary system such as Microsoft Exchange/Outlook or Lotus Notes/Domino. Webmail clients may use either method, but the retrieval protocol is often not a formal standard.
SMTP defines message transport, not the message content. Thus, it defines the mail envelope and its parameters, such as the envelope sender, but not the header or the body of the message itself. STD 10 and RFC 5321 define SMTP (the envelope), while STD 11 and RFC 5322 define the message (header and body), formally referred to as the Internet Message Format.

Protocol overview

SMTP is a text-based protocol, in which a mail sender communicates with a mail receiver by issuing command strings and supplying necessary data over a reliable ordered data stream channel, typically a Transmission Control Protocol (TCP) connection. An SMTP session consists of commands originated by an SMTP client (the initiating agent, sender, or transmitter) and corresponding responses from the SMTP server (the listening agent, or receiver) so that the session is opened, and session parameters are exchanged. A session may include zero or more SMTP transactions. An SMTP transaction consists of three command/reply sequences (see example below.) They are:
MAIL command, to establish the return address, a.k.a. Return-Path, 5321.From, mfrom, or envelope sender. This is the address for bounce messages.
RCPT command, to establish a recipient of this message. This command can be issued multiple times, one for each recipient. These addresses are also part of the envelope.
DATA to send the message text. This is the content of the message, as opposed to its envelope. It consists of a message header and a message body separated by an empty line. DATA is actually a group of commands, and the server replies twice: once to the DATA command proper, to acknowledge that it is ready to receive the text, and the second time after the end-of-data sequence, to either accept or reject the entire message.
Besides the intermediate reply for DATA, each server's reply can be either positive (2xx reply codes) or negative. Negative replies can be permanent (5xx codes) or transient (4xx codes). A reject is a permanent failure by an SMTP server; in this case the SMTP client should send a bounce message. A drop is a positive response followed by message discard rather than delivery.
The initiating host, the SMTP client, can be either an end-user's email client, functionally identified as a mail user agent (MUA), or a relay server's mail transfer agent (MTA), that is an SMTP server acting as an SMTP client, in the relevant session, in order to relay mail. Fully-capable SMTP servers maintain queues of messages for retrying message transmissions that resulted in transient failures.
A MUA knows the outgoing mail SMTP server from its configuration. An SMTP server acting as client, i.e. relaying, typically determines which SMTP server to connect to by looking up the MX (Mail eXchange) DNS resource record for each recipient's domain name. Conformant MTAs (not all) fall back to a simple A record in case no MX record can be found. Relaying servers can also be configured to use a smart host.
An SMTP server acting as client initiates a TCP connection to the server on the "well-known port" designated for SMTP: port 25. MUAs should use port 587 to connect to an MSA. The main difference between an MTA and an MSA is that SMTP Authentication is mandatory for the latter only.

SMTP vs mail retrieval
SMTP is a delivery protocol only. It cannot pull messages from a remote server on demand. Other protocols, such as the Post Office Protocol (POP) and the Internet Message Access Protocol (IMAP) are specifically designed for retrieving messages and managing mail boxes. However, SMTP has a feature to initiate mail queue processing on a remote server so that the requesting system may receive any messages destined for it (cf. Remote Message Queue Starting). POP and IMAP are preferred protocols when a user's personal computer is only intermittently powered up, or Internet connectivity is only transient and hosts cannot receive message during off-line periods.

Remote Message Queue Starting
Remote Message Queue Starting is a feature of SMTP that permits a remote host to start processing of the mail queue on a server so it may receive messages destined to it by sending the TURN command. This feature however was deemed insecure and was extended in RFC 1985 with the ETRN command which operates more securely using an authentication method based on Domain Name System information.

On-Demand Mail Relay
Main article: On-Demand Mail Relay

Internationalization
RFC 5336 describes internationalization features for SMTP, the UTF8SMTP extension, which provides support for multi-byte and non-ASCII characters in email addresses, such as Pelé@live.com (simple diacritic), δοκιμή@παράδειγμα.δοκιμή, and 测试@测试.测试.

Outgoing mail SMTP server

An e-mail client requires the name or the IP address of an SMTP server as part of its configuration. The server will deliver messages on behalf of the user. This setting allows for various policies and network designs. End users connected to the Internet can use the services of an e-mail provider that is not necessarily the same as their connection provider (ISP). Network topology, or the location of a client within a network or outside of a network, is no longer a limiting factor for e-mail submission or delivery. Modern SMTP servers typically use a client's credentials (authentication) rather than a client's location (IP address), to determine whether it is eligible to relay e-mail.
Server administrators choose whether clients use TCP port 25 (SMTP) or port 587 (Submission), as formalized in RFC 4409, for relaying outbound mail to a mail server. The specifications and many servers support both. Although some servers support port 465 for legacy secure SMTP in violation of the specifications, it is preferable to use standard ports and standard ESMTP commands according to RFC 3207 if a secure session needs to be used between the client and the server. Some servers are set up to reject all relaying on port 25, but valid users authenticating on port 587 are allowed to relay mail to any valid address. A server that relays all e-mail for all destinations for all clients connecting to port 25 is known as an open relay and is now generally considered a bad practice worthy of blacklisting.
Some Internet service providers intercept port 25, so that it is not possible for their users to send mail via a relaying SMTP server outside the ISP's network using port 25; they are restricted to using the ISP's SMTP server. Some independent SMTP servers support an additional port other than 25 to allow users with authenticated access to connect to them even if port 25 is blocked. The practical purpose of this is that a mobile user connecting to different ISPs otherwise has to change SMTP server settings on the mail client for each ISP; using a relaying SMTP server allows the SMTP client settings to be used unchanged worldwide.

SMTP transport example

A typical example of sending a message via SMTP to two mailboxes (alice and theboss) located in the same mail domain (example.com) is reproduced in the following session exchange.
For illustration purposes here (not part of protocol), the protocol exchanges are prefixed for the server (S:) and the client (C:).
After the message sender (SMTP client) establishes a reliable communications channel to the message receiver (SMTP server), the session is opened with a greeting by the server, usually containing its fully qualified domain name (FQDN), in this case smtp.example.com. The client initiates its dialog by responding with a HELO command identifying itself in the command's parameter with its FQDN (or an address literal if none is available).
S: 220 smtp.example.com ESMTP Postfix
C: HELO relay.example.org
S: 250 Hello relay.example.org, I am glad to meet you

C: MAIL FROM:
S: 250 Ok
C: RCPT TO:
S: 250 Ok
C: RCPT TO:
S: 250 Ok
C: DATA
S: 354 End data with .
C: From: "Bob Example" 
C: To: "Alice Example" 
C: Cc: theboss@example.com
C: Date: Tue, 15 Jan 2008 16:02:43 -0500
C: Subject: Test message
C:
C: Hello Alice.
C: This is a test message with 5 header fields and 4 lines in the message body.
C: Your friend,
C: Bob
C: .
S: 250 Ok: queued as 12345
C: QUIT
S: 221 Bye
{The server closes the connection}

The client notifies the receiver of the originating email address of the message in a MAIL FROM command. In this example, the email message is sent to two mailboxes on the same SMTP server: one each for each recipient listed in the To and Cc header fields. The corresponding SMTP command is RCPT TO. Each successful reception and execution of a command is acknowledged by the server with a result code and response message (e.g., 250 Ok).
The transmission of the body of the mail message is initiated with a DATA command after which it is transmitted verbatim line by line and is terminated with an end-of-data sequence. This sequence consists of a new-line (), a single full stop (period), followed by another new-line. Since a message body can contain a line with just a period as part of the text, the client sends two periods every time a line starts with a period; correspondingly, the server replaces every sequence of two periods at the beginning of a line with a single one. Such escaping method is called dot-stuffing.
The server's positive reply to the end-of-data, as exemplified, implies that the server has taken the responsibility of delivering the message. A message can be doubled if there is a communication failure at this time, e.g. due to a power shortage: Until the sender has received that 250 reply, it must assume the message was not delivered. On the other hand, after the receiver has decided to accept the message, it must assume the message has been delivered to it. Thus, during this time span, both agents have active copies of the message that they will try to deliver. The probability that a communication failure occurs exactly at this step is directly proportional to the amount of filtering that the server performs on the message body, most often for anti-spam purposes. The limiting timeout is specified to be 10 minutes.
The QUIT command ends the session. If the second recipient were located elsewhere, the client would QUIT and connect to the appropriate SMTP server after the first message had been queued. The information that the client sends in the HELO and MAIL FROM commands are added (not seen in example code) as additional header fields to the message by the receiving server. It adds a Received and Return-Path header field, respectively.

Optional extensions

Although optional and not shown in this example, many clients ask the server for the SMTP extensions that the server supports, by using the EHLO greeting of the extended SMTP specification (RFC 1870). Clients fall back to HELO only if the server does not respond to EHLO.
Modern clients may use the ESMTP extension keyword SIZE to query the server for the maximum message size that will be accepted. Older clients and servers may try to transfer excessively-sized messages that will be rejected after consuming network resources, including connect time to network links that is paid by the minute.
Users can manually determine in advance the maximum size accepted by ESMTP servers. The client replaces the HELO command with the EHLO command.
S: 220 smtp2.example.com ESMTP Postfix
C: EHLO bob.example.org
S: 250-smtp2.example.com Hello bob.example.org [192.0.2.201]
S: 250-SIZE 14680064
S: 250-PIPELINING
S: 250 HELP
Thus smtp2.example.com declares that it will accept a fixed maximum message size no larger than 14,680,064 octets (8-bit bytes). Depending on the server's actual resource usage, it may be currently unable to accept a message this large. In the simplest case, an ESMTP server will declare a maximum SIZE with only the EHLO user interaction.

Security and spamming

Main article: Anti-spam techniques (e-mail)
The original SMTP specification did not include a facility for authentication of senders. Subsequently, the SMTP-AUTH extension was defined by RFC 2554. The SMTP extension (ESMTP) provides a mechanism for email clients to specify a security mechanism to a mail server, authenticate the exchange, and negotiate a security profile (Simple Authentication and Security Layer, SASL) for subsequent message transfers.
Microsoft products implement the proprietary Secure Password Authentication (SPA) protocol through the use of the SMTP-AUTH extension.
However, the impracticality of widespread SMTP-AUTH implementation and management means that E-mail spamming is not and cannot be addressed by it.
Modifying SMTP extensively, or replacing it completely, is not believed to be practical, due to the network effects of the huge installed base of SMTP. Internet Mail 2000 was one such proposal for replacement.
Spam is enabled by several factors, including vendors implementing broken MTAs (that do not adhere to standards, and therefore make it difficult for other MTAs to enforce standards), security vulnerabilities within the operating system (often exacerbated by always-on broadband connections) that allow spammers to remotely control end-user PCs and cause them to send spam, and a lack of "intelligence" in many MTAs.
There are a number of proposals for sideband protocols that will assist SMTP operation. The Anti-Spam Research Group (ASRG) of the Internet Research Task Force (IRTF) is working on a number of E-mail authentication and other proposals for providing simple source authentication that is flexible, lightweight, and scalable. Recent Internet Engineering Task Force (IETF) activities include MARID (2004) leading to two approved IETF experiments in 2005, and DomainKeys Identified Mail in 2006.


(source:wikipedia)

Email

Electronic mail, commonly called email or e-mail, is a method of exchanging digital messages across the Internet or other computer networks. Originally, email was transmitted directly from one user to another computer. This required both computers to be online at the same time, a la instant messaging. Today's email systems are based on a store-and-forward model. Email servers accept, forward, deliver and store messages. Users no longer need be online simultaneously and need only connect briefly, typically to an email server, for as long as it takes to send or receive messages.
An email message consists of two components, the message header, and the message body, which is the email's content. The message header contains control information, including, minimally, an originator's email address and one or more recipient addresses. Usually additional information is added, such as a subject header field.
Originally a text only (7 bit ASCII and others) communications medium, email was extended to carry multi-media content attachments, a process standardized in RFC 2045 through 2049. Collectively, these RFCs have come to be called Multipurpose Internet Mail Extensions (MIME).
The history of modern, global Internet email services reaches back to the early ARPANET. Standards for encoding email messages were proposed as early as 1973 (RFC 561). Conversion from ARPANET to the Internet in the early 1980s produced the core of the current services. An email sent in the early 1970s looks quite similar to one sent on the Internet today.
Network-based email was initially exchanged on the ARPANET in extensions to the File Transfer Protocol (FTP), but is now carried by the Simple Mail Transfer Protocol (SMTP), first published as Internet standard 10 (RFC 821) in 1982. In the process of transporting email messages between systems, SMTP communicates delivery parameters using a message envelope separate from the message (header and body) itself.

Spelling

There are several spelling variations that occasionally prove cause for surprisingly vehement disagreement.
email is the form required by IETF Requests for Comment and working groups and increasingly by style guides. This spelling also appears in most dictionaries.
e-mail is a form recommended by some prominent journalistic and technical style guides. According to Corpus of Contemporary American English data, this form appears most frequently in edited, published American English writing.
mail was the form used in the original RFC. The service is referred to as mail and a single piece of electronic mail is called a message.
eMail, capitalizing only the letter M, was common among ARPANET users and the early developers of Unix, CMS, AppleLink, eWorld, AOL, GEnie, and Hotmail.
EMail is a traditional form that has been used in RFCs for the "Author's Address",and is expressly required "...for historical reasons...".
E-mail, capitalizing the initial letter E in the same way as A-bomb, H-bomb, X-ray, T-shirt, and similar shortenings.

Origin

Electronic mail predates the inception of the Internet, and was in fact a crucial tool in creating it.
MIT first demonstrated the Compatible Time-Sharing System (CTSS) in 1961. It allowed multiple users to log into the IBM 7094 from remote dial-up terminals, and to store files online on disk. This new ability encouraged users to share information in new ways. Email started in 1965 as a way for multiple users of a time-sharing mainframe computer to communicate. Among the first systems to have such a facility were SDC's Q32 and MIT's CTSS.

Host-based mail systems

The original email systems allowed communication only between users who logged into the same host or "mainframe". This could be hundreds or even thousands of users within an organization.
By 1966 (or earlier, it is possible that the SAGE system had something similar some time before), such systems allowed email between different organizations, so long as they ran compatible operating systems.
Examples include BITNET, IBM PROFS, Digital Equipment Corporation ALL-IN-1 and the original Unix mail.

LAN-based mail systems

From the early 1980s, networked personal computers on LANs became increasingly important. Server-based systems similar to the earlier mainframe systems were developed. Again these systems initially allowed communication only between users logged into the same server infrastructure. Eventually these systems could also be linked between different organizations, as long as they ran the same email system and proprietary protocol.
Examples include cc:Mail, Lantastic, WordPerfect Office, Microsoft Mail, Banyan VINES and Lotus Notes - with various vendors supplying gateway software to link these incompatible systems.

Attempts at interoperability

Novell briefly championed the open MHS protocol but abandoned it after purchasing the non-MHS WordPerfect Office (renamed Groupwise)
uucp was used as an open "glue" between differing mail systems
The Coloured Book protocols on UK academic networks until 1992
X.400 in the early 1990s was mandated for government use under GOSIP but almost immediately abandoned by all but a few — in favour of Internet SMTP

From SNDMSG to MSG
In the early 1970s, Ray Tomlinson updated an existing utility called SNDMSG so that it could copy files over the network. Lawrence Roberts, the project manager for the ARPANET development, updated READMAIL and called the program RD. Barry Wessler then updated RD and called it NRD.
Marty Yonke combined SNDMSG and NRD to include reading, sending, and a help system, and called the utility WRD. John Vittal then updated this version to include message forwarding and an Answer command to create replies with the correct address, and called it MSG. With inclusion of these features, MSG is considered to be the first modern email program, from which many other applications have descended.

The rise of ARPANET mail
The ARPANET computer network made a large contribution to the development of e-mail. There is one report that indicates experimental inter-system email transfers began shortly after its creation in 1969. Ray Tomlinson is credited by some as having sent the first email, initiating the use of the "@" sign to separate the names of the user and the user's machine in 1971, when he sent a message from one Digital Equipment Corporation DEC-10 computer to another DEC-10. The two machines were placed next to each other. The ARPANET significantly increased the popularity of email, and it became the killer app of the ARPANET.
Most other networks had their own email protocols and address formats; as the influence of the ARPANET and later the Internet grew, central sites often hosted email gateways that passed mail between the Internet and these other networks. Internet email addressing is still complicated by the need to handle mail destined for these older networks. Some well-known examples of these were UUCP (mostly Unix computers), BITNET (mostly IBM and VAX mainframes at universities), FidoNet (personal computers), DECNET (various networks) and CSNET a forerunner of NSFNet.
An example of an Internet email address that routed mail to a user at a UUCP host:
hubhost!middlehost!edgehost!user@uucpgateway.somedomain.example.com
This was necessary because in early years UUCP computers did not maintain (or consult servers for) information about the location of all hosts they exchanged mail with, but rather only knew how to communicate with a few network neighbors; email messages (and other data such as Usenet News) were passed along in a chain among hosts who had explicitly agreed to share data with each other.

Operation overview

The diagram to the right shows a typical sequence of events that takes place when Alice composes a message using her mail user agent (MUA). She enters the email address of her correspondent, and hits the "send" button.
Her MUA formats the message in email format and uses the Simple Mail Transfer Protocol (SMTP) to send the message to the local mail transfer agent (MTA), in this case smtp.a.org, run by Alice's internet service provider (ISP).
The MTA looks at the destination address provided in the SMTP protocol (not from the message header), in this case bob@b.org. An Internet email address is a string of the form localpart@exampledomain. The part before the @ sign is the local part of the address, often the username of the recipient, and the part after the @ sign is a domain name or a fully qualified domain name. The MTA resolves a domain name to determine the fully qualified domain name of the mail exchange server in the Domain Name System (DNS).
The DNS server for the b.org domain, ns.b.org, responds with any MX records listing the mail exchange servers for that domain, in this case mx.b.org, a server run by Bob's ISP.
smtp.a.org sends the message to mx.b.org using SMTP, which delivers it to the mailbox of the user bob.
Bob presses the "get mail" button in his MUA, which picks up the message using the Post Office Protocol (POP3).
That sequence of events applies to the majority of email users. However, there are many alternative possibilities and complications to the email system:
Alice or Bob may use a client connected to a corporate email system, such as IBM Lotus Notes or Microsoft Exchange. These systems often have their own internal email format and their clients typically communicate with the email server using a vendor-specific, proprietary protocol. The server sends or receives email via the Internet through the product's Internet mail gateway which also does any necessary reformatting. If Alice and Bob work for the same company, the entire transaction may happen completely within a single corporate email system.
Alice may not have a MUA on her computer but instead may connect to a webmail service.
Alice's computer may run its own MTA, so avoiding the transfer at step 1.
Bob may pick up his email in many ways, for example using the Internet Message Access Protocol, by logging into mx.b.org and reading it directly, or by using a webmail service.
Domains usually have several mail exchange servers so that they can continue to accept mail when the main mail exchange server is not available.
Email messages are not secure if e-mail encryption is not used correctly.
Many MTAs used to accept messages for any recipient on the Internet and do their best to deliver them. Such MTAs are called open mail relays. This was very important in the early days of the Internet when network connections were unreliable. If an MTA couldn't reach the destination, it could at least deliver it to a relay closer to the destination. The relay stood a better chance of delivering the message at a later time. However, this mechanism proved to be exploitable by people sending unsolicited bulk email and as a consequence very few modern MTAs are open mail relays, and many MTAs don't accept messages from open mail relays because such messages are very likely to be spam.

Message format

The Internet email message format is defined in RFC 5322 and a series of RFCs, RFC 2045 through RFC 2049, collectively called, Multipurpose Internet Mail Extensions, or MIME. Although as of July 13, 2005, RFC 2822 is technically a proposed IETF standard and the MIME RFCs are draft IETF standards,[28] these documents are the standards for the format of Internet email. Prior to the introduction of RFC 2822 in 2001, the format described by RFC 822 was the standard for Internet email for nearly 20 years; it is still the official IETF standard. The IETF reserved the numbers 5321 and 5322 for the updated versions of RFC 2821 (SMTP) and RFC 2822, as it previously did with RFC 821 and RFC 822, honoring the extreme importance of these two RFCs. RFC 822 was published in 1982 and based on the earlier RFC 733 (see).
Internet email messages consist of two major sections:
Header — Structured into fields such as summary, sender, receiver, and other information about the email.
Body — The message itself as unstructured text; sometimes containing a signature block at the end. This is exactly the same as the body of a regular letter.
The header is separated from the body by a blank line.

Message header
Each message has exactly one header, which is structured into fields. Each field has a name and a value. RFC 5322 specifies the precise syntax.
Informally, each line of text in the header that begins with a printable character begins a separate field. The field name starts in the first character of the line and ends before the separator character ":". The separator is then followed by the field value (the "body" of the field). The value is continued onto subsequent lines if those lines have a space or tab as their first character. Field names and values are restricted to 7-bit ASCII characters. Non-ASCII values may be represented using MIME encoded words.

Header fields

The message header should include at least the following fields:
From: The email address, and optionally the name of the author(s). In many email clients not changeable except through changing account settings.
To: The email address(es), and optionally name(s) of the message's recipient(s). Indicates primary recipients (multiple allowed), for secondary recipients see Cc: and Bcc: below.
Subject: A brief summary of the topic of the message. Certain abbreviations are commonly used in the subject, including "RE:" and "FW:".
Date: The local time and date when the message was written. Like the From: field, many email clients fill this in automatically when sending. The recipient's client may then display the time in the format and time zone local to him/her.
Message-ID: Also an automatically generated field; used to prevent multiple delivery and for reference in In-Reply-To: (see below).
Note that the To: field is not necessarily related to the addresses to which the message is delivered. The actual delivery list is supplied separately to the transport protocol, SMTP, which may or may not originally have been extracted from the header content. The "To:" field is similar to the addressing at the top of a conventional letter which is delivered according to the address on the outer envelope. Also note that the "From:" field does not have to be the real sender of the email message. One reason is that it is very easy to fake the "From:" field and let a message seem to be from any mail address. It is possible to digitally sign email, which is much harder to fake, but such signatures require extra programming and often external programs to verify. Some ISPs do not relay email claiming to come from a domain not hosted by them, but very few (if any) check to make sure that the person or even email address named in the "From:" field is the one associated with the connection. Some ISPs apply email authentication systems to email being sent through their MTA to allow other MTAs to detect forged spam that might appear to come from them.
RFC 3864 describes registration procedures for message header fields at the IANA; it provides for permanent and provisional message header field names, including also fields defined for MIME, netnews, and http, and referencing relevant RFCs. Common header fields for email include:
Bcc: Blind Carbon Copy; addresses added to the SMTP delivery list but not (usually) listed in the message data, remaining invisible to other recipients.
Cc: Carbon copy; Many email clients will mark email in your inbox differently depending on whether you are in the To: or Cc: list.
Content-Type: Information about how the message is to be displayed, usually a MIME type.
In-Reply-To: Message-ID of the message that this is a reply to. Used to link related messages together.
Precedence: commonly with values "bulk", "junk", or "list"; used to indicate that automated "vacation" or "out of office" responses should not be returned for this mail, e.g. to prevent vacation notices from being sent to all other subscribers of a mailinglist. Sendmail uses this header to affect prioritization of queued email, with "Precedence: special-delivery" messages delivered sooner. With modern high-bandwidth networks delivery priority is less of an issue than it once was. Microsoft Exchange respects a fine-grained automatic response suppression mechanism, the X-Auto-Response-Suppress header.
Received: Tracking information generated by mail servers that have previously handled a message, in reverse order (last handler first).
References: Message-ID of the message that this is a reply to, and the message-id of the message the previous was reply a reply to, etc.
Reply-To: Address that should be used to reply to the message.
Sender: Address of the actual sender acting on behalf of the author listed in the From: field (secretary, list manager, etc.).

Message body


Content encoding
Email was originally designed for 7-bit ASCII. Much email software is 8-bit clean but must assume it will communicate with 7-bit servers and mail readers. The MIME standard introduced character set specifiers and two content transfer encodings to enable transmission of non-ASCII data: quoted printable for mostly 7 bit content with a few characters outside that range and base64 for arbitrary binary data. The 8BITMIME extension was introduced to allow transmission of mail without the need for these encodings but many mail transport agents still do not support it fully. In some countries, several encoding schemes coexist; as the result, by default, the message in a non-Latin alphabet language appears in non-readable form (the only exception is coincidence, when the sender and receiver use the same encoding scheme). Therefore, for international character sets, Unicode is growing in popularity.

Plain text and HTML
Most modern graphic email clients allow the use of either plain text or HTML for the message body at the option of the user. HTML email messages often include an automatically generated plain text copy as well, for compatibility reasons.
Advantages of HTML include the ability to include in-line links and images, set apart previous messages in block quotes, wrap naturally on any display, use emphasis such as underlines and italics, and change font styles. Disadvantages include the increased size of the email, privacy concerns about web bugs, abuse of HTML email as a vector for phishing attacks and the spread of malicious software.
Some web based Mailing lists recommend that all posts be made in plain-text for all the above reasons, but also because they have a significant number of readers using text-based email clients such as Mutt.
Some Microsoft email clients allow rich formatting using RTF, but unless the recipient is guaranteed to have a compatible email client this should be avoided.
In order to ensure that HTML sent in an email is rendered properly by the recipient's client software, an additional header must be specified when sending: "Content-type: text/html". Most email programs send this header automatically.

Servers and client applications



The interface of an email client, Thunderbird.
Messages are exchanged between hosts using the Simple Mail Transfer Protocol with software programs called mail transfer agents. Users can retrieve their messages from servers using standard protocols such as POP or IMAP, or, as is more likely in a large corporate environment, with a proprietary protocol specific to Lotus Notes or Microsoft Exchange Servers. Webmail interfaces allow users to access their mail with any standard web browser, from any computer, rather than relying on an email client.
Mail can be stored on the client, on the server side, or in both places. Standard formats for mailboxes include Maildir and mbox. Several prominent email clients use their own proprietary format and require conversion software to transfer email between them.
Accepting a message obliges an MTA to deliver it, and when a message cannot be delivered, that MTA must send a bounce message back to the sender, indicating the problem.

Filename extensions
Upon reception of email messages, email client applications save message in operating system files in the file-system. Some clients save individual messages as separate files, while others use various database formats, often proprietary, for collective storage. A historical standard of storage is the mbox format. The specific format used is often indicated by special filename extensions:
eml
Used by many email clients including Microsoft Outlook Express, Windows Mail and Mozilla Thunderbird. The files are plain text in MIME format, containing the email header as well as the message contents and attachments in one or more of several formats.
emlx
Used by Apple Mail.
msg
Used by Microsoft Office Outlook and OfficeLogic Groupware.
mbx
Used by Opera Mail, KMail, and Apple Mail based on the mbox format.
Some applications (like Apple Mail) leave attachments encoded in messages for searching while also saving separate copies of the attachments. Others separate attachments from messages and save them in a specific directory.

URI scheme mailto:
The URI scheme, as registered with the IANA, defines the mailto: scheme for SMTP email addresses. Though its use is not strictly defined, URLs of this form are intended to be used to open the new message window of the user's mail client when the URL is activated, with the address as defined by the URL in the To: field.

Use

In society
There are numerous ways in which people have changed the way they communicate in the last 50 years; email is certainly one of them. Traditionally, social interaction in the local community was the basis for communication – face to face. Yet, today face-to-face meetings are no longer the primary way to communicate as one can use a landline telephone, mobile phones, fax services, or any number of the computer mediated communications such as email.

Flaming
Flaming occurs when a person sends a message with angry or antagonistic content. Flaming is assumed to be more common today because of the ease and impersonality of email communications: confrontations in person or via telephone require direct interaction, where social norms encourage civility, whereas typing a message to another person is an indirect interaction, so civility may be forgotten. Flaming is generally looked down upon by Internet communities as it is considered rude and non-productive.

Email bankruptcy
Main article: Email bankruptcy
Also known as "email fatigue", email bankruptcy is when a user ignores a large number of email messages after falling behind in reading and answering them. The reason for falling behind is often due to information overload and a general sense there is so much information that it is not possible to read it all. As a solution, people occasionally send a boilerplate message explaining that the email inbox is being cleared out. Stanford University law professor Lawrence Lessig is credited with coining this term, but he may only have popularized it.

In business
Email was widely accepted by the business community as the first broad electronic communication medium and was the first ‘e-revolution’ in business communication. Email is very simple to understand and like postal mail, email solves two basic problems of communication: logistics and synchronization (see below).
LAN based email is also an emerging form of usage for business. It not only allows the business user to download mail when offline, it also provides the small business user to have multiple users email ID's with just one email connection.

Pros
The problem of logistics: Much of the business world relies upon communications between people who are not physically in the same building, area or even country; setting up and attending an in-person meeting, telephone call, or conference call can be inconvenient, time-consuming, and costly. Email provides a way to exchange information between two or more people with no set-up costs and that is generally far less expensive than physical meetings or phone calls.
The problem of synchronisation: With real time communication by meetings or phone calls, participants have to work on the same schedule, and each participant must spend the same amount of time in the meeting or call. Email allows asynchrony: each participant may control their schedule independently.

Cons

This section may contain original research. Please improve it by verifying the claims made and adding references. Statements consisting only of original research may be removed. More details may be available on the talk page. (June 2009)
Most business workers today spend from one to two hours of their working day on email: reading, ordering, sorting, ‘re-contextualizing’ fragmented information, and writing email. The use of email is increasing due to increasing levels of globalisation—labour division and outsourcing amongst other things. Email can lead to some well-known problems:
Loss of context: which means that the context is lost forever; there is no way to get the text back. Information in context (as in a newspaper) is much easier and faster to understand than unedited and sometimes unrelated fragments of information. Communicating in context can only be achieved when both parties have a full understanding of the context and issue in question.
Information overload: Email is a push technology—the sender controls who receives the information. Convenient availability of mailing lists and use of "copy all" can lead to people receiving unwanted or irrelevant information of no use to them.
Inconsistency: Email can duplicate information. This can be a problem when a large team is working on documents and information while not in constant contact with the other members of their team.
Despite these disadvantages, email has become the most widely used medium of communication within the business world. In fact, a 2010 study on workplace communication, found that 83% of U.S. knowledge workers felt that email was critical to their success and productivity at work.

Problems



Attachment size limitation
Main article: Email attachment
Email messages may have one or more attachments. Attachments serve the purpose of delivering binary or text files of unspecified size. In principle there is no technical intrinsic restriction in the SMTP protocol limiting the size or number of attachments. In practice, however, email service providers implement various limitations on the permissible size of files or the size of an entire message.
Furthermore, due to technical reasons, often a small attachment can increase in size when sent, which can be confusing to senders when trying to assess whether they can or cannot send a file by email, and this can result in their message being rejected.
As larger and larger file sizes are being created and traded, many users are either forced to upload and download their files using an FTP server, or more popularly, use online file sharing facilities or services, usually over web-friendly HTTP, in order to send and receive them.

Information overload
A December 2007 New York Times blog post described information overload as "a $650 Billion Drag on the Economy", and the New York Times reported in April 2008 that "E-MAIL has become the bane of some people’s professional lives" due to information overload, yet "none of the current wave of high-profile Internet start-ups focused on e-mail really eliminates the problem of e-mail overload because none helps us prepare replies". GigaOm posted a similar article in September 2010, highlighting research that found 57% of knowledge workers were overwhelmed by the volume of email they received.
Technology investors reflect similar concerns.

Spamming and computer viruses
The usefulness of email is being threatened by four phenomena: email bombardment, spamming, phishing, and email worms.
Spamming is unsolicited commercial (or bulk) email. Because of the very low cost of sending email, spammers can send hundreds of millions of email messages each day over an inexpensive Internet connection. Hundreds of active spammers sending this volume of mail results in information overload for many computer users who receive voluminous unsolicited email each day.
Email worms use email as a way of replicating themselves into vulnerable computers. Although the first email worm affected UNIX computers, the problem is most common today on the more popular Microsoft Windows operating system.
The combination of spam and worm programs results in users receiving a constant drizzle of junk email, which reduces the usefulness of email as a practical tool.
A number of anti-spam techniques mitigate the impact of spam. In the United States, U.S. Congress has also passed a law, the Can Spam Act of 2003, attempting to regulate such email. Australia also has very strict spam laws restricting the sending of spam from an Australian ISP, but its impact has been minimal since most spam comes from regimes that seem reluctant to regulate the sending of spam.

E-mail spoofing
Main article: Email spoofing
E-mail spoofing occurs when the header information of an email is altered to make the message appear to come from a known or trusted source. It is often used as a ruse to collect personal information.

Email bombing
Email bombing is the intentional sending of large volumes of messages to a target address. The overloading of the target email address can render it unusable and can even cause the mail server to crash.

Privacy concerns
Main article: E-mail privacy
Email privacy, without some security precautions, can be compromised because:
email messages are generally not encrypted.
email messages have to go through intermediate computers before reaching their destination, meaning it is relatively easy for others to intercept and read messages.
many Internet Service Providers (ISP) store copies of email messages on their mail servers before they are delivered. The backups of these can remain for up to several months on their server, despite deletion from the mailbox.
the "Received:"-fields and other information in the email can often identify the sender, preventing anonymous communication.
There are cryptography applications that can serve as a remedy to one or more of the above. For example, Virtual Private Networks or the Tor anonymity network can be used to encrypt traffic from the user machine to a safer network while GPG, PGP, SMEmail, or S/MIME can be used for end-to-end message encryption, and SMTP STARTTLS or SMTP over Transport Layer Security/Secure Sockets Layer can be used to encrypt communications for a single mail hop between the SMTP client and the SMTP server.
Additionally, many mail user agents do not protect logins and passwords, making them easy to intercept by an attacker. Encrypted authentication schemes such as SASL prevent this.
Finally, attached files share many of the same hazards as those found in peer-to-peer filesharing. Attached files may contain trojans or viruses.

Tracking of sent mail
The original SMTP mail service provides limited mechanisms for tracking a transmitted message, and none for verifying that it has been delivered or read. It requires that each mail server must either deliver it onward or return a failure notice (bounce message), but both software bugs and system failures can cause messages to be lost. To remedy this, the IETF introduced Delivery Status Notifications (delivery receipts) and Message Disposition Notifications (return receipts); however, these are not universally deployed in production.
Many ISPs now deliberately disable non-delivery report (NDRs) and delivery receipts due to the activities of spammers:
Delivery Reports can be used to verify whether an address exists and so is available to be spammed
If the spammer uses a forged sender email address (E-mail spoofing), then the innocent email address that was used can be flooded with NDRs from the many invalid email addresses the spammer may have attempted to mail. These NDRs then constitute spam from the ISP to the innocent user
There are a number of systems that allow the sender to see if messages have been opened.

US Government

The US Government has been involved in email in several different ways.
Starting in 1977, the US Postal Service (USPS) recognized that electronic mail and electronic transactions posed a significant threat to First Class mail volumes and revenue. Therefore, the USPS initiated an experimental email service known as E-COM. Electronic messages were transmitted to a post office, printed out, and delivered as hard copy. To take advantage of the service, an individual had to transmit at least 200 messages. The delivery time of the messages was the same as First Class mail and cost 26 cents. Both the Postal Regulatory Commission and the Federal Communications Commission opposed E-COM. The FCC concluded that E-COM constituted common carriage under its jurisdiction and the USPS would have to file a tariff. Three years after initiating the service, USPS canceled E-COM and attempted to sell it off.
The early ARPANET dealt with multiple email clients that had various, and at times incompatible, formats. For example, in the system Multics, the "@" sign meant "kill line" and anything after the "@" sign was ignored. The Department of Defense DARPA desired to have uniformity and interoperability for email and therefore funded efforts to drive towards unified inter-operable standards. This led to David Crocker, John Vittal, Kenneth Pogran, and Austin Henderson publishing RFC 733, "Standard for the Format of ARPA Network Text Message" (November 21, 1977), which was apparently not effective. In 1979, a meeting was held at BBN to resolve incompatibility issues. Jon Postel recounted the meeting in RFC 808, "Summary of Computer Mail Services Meeting Held at BBN on 10 January 1979" (March 1, 1982), which includes an appendix listing the varying email systems at the time. This, in turn, lead to the release of David Crocker's RFC 822, "Standard for the Format of ARPA Internet Text Messages" (August 13, 1982).
The National Science Foundation took over operations of the ARPANET and Internet from the Department of Defense, and initiated NSFNet, a new backbone for the network. A part of the NSFNet AUP forbade commercial traffic. In 1988, Vint Cerf arranged for an interconnection of MCI Mail with NSFNET on an experimental basis. The following year Compuserve email interconnected with NSFNET. Within a few years the commercial traffic restriction was removed from NSFNETs AUP, and NSFNET was privatised.
In the late 1990s, the Federal Trade Commission grew concerned with fraud transpiring in email, and initiated a series of procedures on spam, fraud, and phishing. In 2004, FTC jurisdiction over spam was codified into law in the form of the CAN SPAM Act.Several other US Federal Agencies have also exercised jurisdiction including the Department of Justice and the Secret Service.


(source:wikipedia)