Despite a new federal law, junk e-mail shows no signs of slowing, which means anti-spam vendors must constantly update their products to keep pace and preserve any hope of distinguishing themselves in an overcrowded market.

The amount of spam sent in January actually increased over November and December, according to messaging company SurfControl, which analyzes 8,000 to 10,000 e-mails daily. It appears spammers aren't taking seriously the CAN-SPAM law that took effect Jan. 1: Less than 1% of bulk e-mail sent this year complies with CAN-SPAM, according to anti-spam vendor Commtouch.

That early track record reinforces the view held by some experts that only technology will be able to protect companies from unwanted e-mail. While this creates a solid business opportunity for anti-spam vendors, it also forces those vendors to spend untold research and development dollars.

"It's definitely an arms race," says Matthew Prince, CEO of anti-spam consulting firm Unspam. "The rise in volume of spam corresponds one-to-one with e-mail filtering: As more filters are put into place, spammers crank up the volume of spam."

Vendors also are forced to strike a balance between blocking spam and ensuring that wanted e-mail isn't trapped by their filters - a balance not all are managing well.

"They have to make sure whatever they do is not overinclusive," Prince adds. "Filter vendors want to make sure they're not coming up with something they predict will block the next [spammer] trick and ends up blocking the next way a customer wants to communicate with a company."

Today's anti-spam industry is much like the anti-virus industry of a few years ago, when many companies invested heavily in developing anti-virus engines as the underpinning of their products, says Ralph Pisani, vice president of channel and business development with CipherTrust. However, not all the companies currently selling anti-spam products can continue investing indefinitely.

"Anti-spam vendors have to look at the problem every single day and come up with something better than they have today," says Masha Khmartseva, a senior analyst at The Radicati Group. She predicts that, much like the anti-virus market, the anti-spam industry will consolidate into a few key players over the next few years.