A number of people have sent me links to “Black Hat Tariffs – The Black Hat Taxes on consumer Internet companies are on the rise:”
In May 2006, I made mention of the Black Hat Tax, in which most consumer Internet sites have an inherent time, resource, and mindshare tax of roughly 25% due to scamming, phishing, hacking, and government requests. And this drainage has gotten worse two years later which is extremely troubling.
All these little, annoying things consume time … and not just the time of customer service people, but time of the company’s executives and engineers as well. The Black Hat Tax exceeds 25% for most consumer Internet companies right now, with some approaching 40%. That means that 25% of your engineering and management time is about preventing fraud or dealing with these annoyances. That is one onerous tax!
So I’m curious: what’s the sample size? How does that 40% break out? Who’s spending all that time, and what are they doing? Are there things that could be outsourced? (Seems like a possibly huge business opportunity.) Are there design flaws that are being paid for? What size companies are in the set?
I don’t know Auren. Reading his blog, he seems like a smart guy. I’m just looking for more on where the 40% number comes from, where it’s happening, and where it goes.