Commtouch Reports Spam Trends for May; Yahoo.com Followed By Hotmail Is Most Used Domain By Spammers.

Business Editors/High-Tech Writers

MOUNTAIN VIEW, Calif.--(BUSINESS WIRE)--June 1, 2004

Commtouch (Nasdaq:CTCH)

-- 160 Countries Sent Spam in May; 58% of the Global Spam Was

Sent from U.S. Sources

-- China Hosted 78% of Websites Referenced in Spam Email, up 7%

from Previous Month; U.S. Figure Was 10.1%, a Steep Drop from

Previous Month's 22%

Commtouch(R) (Nasdaq:CTCH), (http://www.commtouch.com) the innovator of industrial-strength anti-spam solutions featuring Recurrent Pattern Detection (RPD)(TM) technology, today reported that the Commtouch Spam Detection Center found in the month of May that Yahoo.com was the most employed spoof domain by spammers in their email address, appearing in 6.46% of spam messages. Email spoofing is the forgery of an e-mail address so that the message appears to have originated from someone or somewhere other than the actual source.

Top 10 Domains Used by Spammers

In May, Yahoo.com was the most used domain by spammers as their spoof domain, with Hotmail.com and MSN.com second and third respectively. As for international domains t-online.de (Germany) led with 0.17% of the global spam followed by wanadoo.fr (France), and videotron.ca (Canada).

The top 10 domains used by spammers in the month of May were:

    --  Yahoo.com       6.46%

    --  Hotmail.com     4.81%

    --  Msn.com         4.30%

    --  Attbi.com       1.78%

    --  Aol.com         1.28%

    --  Canada.com      0.38%

    --  Excite.com      0.23%

    --  Comcast.net     0.22%

    --  Netscape.net    0.22%

    --  Earthlink.net   0.21%

"There's a perfect reason why Yahoo.com is the most used domain by spammers," said Avner Amram, executive vice president at Commtouch. "Many mail servers reject incoming email attempts at the start of the receiving session (SMTP), if the receiver of the email message is not recognized on the system. The mail server which Yahoo.com uses doesn't support this feature in the beginning of the receiving session, but rather at the end of it."

According to Amram, many anti-spam solutions are initiating SMTP protocol sender mail servers to check the validity of the sender of the email message, and if the sender of a message is not valid, will classify this message as spam. "This method cannot be used on Yahoo.com because the result is that legitimate senders from Yahoo.com will get a test message from the anti-spam solution when trying to determine email legitimacy," says Amram. "Yahoo.com mail server is not the only domain which does not support this feature; there are many more domains which don't support this feature, not even in the end of SMTP session, but Yahoo.com is certainly the largest domain in term of number of users."

According to Amram, if all mail servers support the validity check of email received by the initiation of SMTP protocol, anti-spam solutions might feature today some of the functionality which Microsoft caller-ID intends to cover in the future.

"Commtouch RPD(TM) technology, assessed by IDC in a recent white paper as having meaningful advantages over other anti-spam solutions (http://www.commtouch.com/download_IDC.asp), analyzes internet traffic in real time and recognizes recurrent patterns in email which spammers cannot easily change," said Amram. "Therefore, Commtouch detection is high and not affected by the domain chosen by spammers."

China Increases Position as Having Most Web Sites Referenced in

Spam Email

Most spam that arrives in email boxes contains a URL to a web site within the email. Commtouch detected in the month of May that more than 78% of the web sites referenced within spam originates in China, a 7% increase from the previous month. The United States was second with a bit less than 10.1% of the global websites, a steep drop from the previous month when the United States hosted 22% of the spammer websites.

Spammer web sites can be found to originate from other countries such as: Egypt, Japan, Netherlands, Italy, Czech Republic, Singapore, Mexico, Belgium and Panama. Below are the top-10 countries hosting web sites referenced in spammer emails:

    -- China                78.08%

    -- U.S.                 10.10%

    -- Brazil                6.37%

    -- Korea                 3.27%


    -- Russian Federation    1.96%

    -- Canada                0.10%

    -- U.K.                  0.03%

    -- Australia             0.015%

    -- Hong Kong             0.013%

    -- Taiwan                0.010%

U.S. Continues to Lead as Main Country Origin of Spam

In the month of May, Commtouch detected that spam was sent from 160 countries. The United States continues to lead as the main country originator of spam, sending nearly 58% of all spam. Asia is the second continent after North America to originate over 20% of spam. South Korea, China, Japan, Hong Kong, Singapore and Taiwan led the Asian continent. South Korea took second place behind the United States as main country originator of spam, sending about 9% of all spam. Germany, Mexico and Netherlands are following the Top 10 list with each responsible for sending about 0.8% of global spam.

The volume of spam email was greatest from the following origin countries:

    -- U.S.         57.90%

    -- South Korea   8.95%

    -- China         6.90%

    -- Canada        3.14%

    -- Brazil        3.09%

    -- Japan         2.12%

    -- Hong Kong     1.88%

    -- Spain         1.74%

    -- U.K.          1.33%

    -- France        1.26%

About Commtouch

Commtouch Software Ltd. is a global developer and provider of proprietary anti-spam solutions featuring Recurrent Pattern Detection (RPD) (TM) technology. Its mission is to protect and preserve the integrity of the world's most important communications tool -- email. The company's core technologies reflect its 13 years of experience as a leading vendor of email software applications and provider of global messaging services. Commtouch's patent-pending technologies are employed in solutions that are sold through channels and resellers. In addition, Commtouch anti-spam technologies are incorporated in software applications of security and messaging OEMs (examples including BlueCat Networks, HotBar, Sybari and Waterford Technologies). Commtouch is headquartered in Netanya, Israel and its subsidiary, Commtouch Inc., is based in Mountain View, CA. The company was founded in 1991 and has been publicly traded since 1999 (NASDAQ: CTCH - News). To learn more about Commtouch's solutions visit our web site at http://www.commtouch.com.

Note: Commtouch(R) is a registered trademark and RPD(TM) - Recurrent Pattern Detection is a trademark of Commtouch Software Ltd. Other terms and product names in this document may be trademarks of others.

This press release contains forward-looking statements, including projections about our business, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. For example, statements in the future tense, and statements including words such as "expect", "plan", "estimate", anticipate", or "believe" are forward-looking statements. These statements are based on information available to us at the time of the release; we assume no obligation to update any of them. The statements in this release are not guarantees of future performance and actual results could differ materially from our current expectations as a result of numerous factors, including business conditions and growth or deterioration in the Internet market, commerce and the general economy both domestic as well as international; fewer than expected new-partner relationships; competitive factors including pricing pressures; technological developments, and products offered by competitors; availability of qualified staff for expansion; and technological difficulties and resource constraints encountered in developing new products as well as those risks described in the company's Annual Reports on Form 20-F and reports on Form 6-K, which are available through www.sec.gov.