>Date: Sun, 28 Mar 1999 15:30:55 -0500 >From: "Harold Feld" <[EMAIL PROTECTED]> >To: <[EMAIL PROTECTED]> >Subject: Reflections on NSI- A week later >Mime-Version: 1.0 > >Mikki, can you please froward. > >Well, it's been a week now, and I'll venture my own take. > >I haven't gotten any NSI money yet, although DNRC has sided with NSI on a >number of compromise positions lately, which is damn funny, since we >organized to fight NSI. Of course, individual members of us still do that >for individual clients. > >First, I think those who argue that NSI has no right to do what it did >under the cooperative agreement are rather naive about government >contracting. Having lost my innocence at the Dep't of Energy, which for a >tremendous amount of its history existed for the purpose of transferring >wealth from the American taxpayer to private contractors, I can say that >NSI's behavior isn't a patch on what goes on all the time. Quoting the >literal language of the cooperative agreement as if it existed in a >vacuum, without a well developed body of government contracting law and >over five years of past practice at this point, is a waste of time and >does little but demonstrate the inexperience of the commenter. > >Not saying this is wrong or right, mind you, just looking at the universe >as it is (as I see it). > >I'll also point out that this isn't a unique deal for NSI. It is standard >for the government to sponsor research with a private company that the >private company gets to keep and market afterwards. >There are some good public policy arguments for this, and arguments that >it amount >to little more than corproate welfare. >The NSI case is somewhat more problematic because what has been created >amounts >to a bottleneck facility over a potentially lucrative business, >and a kick-ass opportunity for branding. > >That being said, I find it unlikely that NTIA or ICANN can "do" anything >about NSI. At the same >time, I suspect NSI will probably back down. Why? Because NSI enjoys >anti-trust protection >as a government instrumentality (or so district courts in D.C. and NY have >said). If NSI wins a court >battle that its free from government control, what happens to that >protection? Would you want to >find out? Balancing the worth of the InterNIC page against the anti-trust >protection, I'd back off >and restore internic.net to its pristine form. > >So legally, NSI is probably o.k. From a strategic perspective, >however, the move is dumber than dog-poo. One would think that >NSI had suddenly had a brain transplant from US WEST or some other RBOC. >Frankly, this is exactly the sort of strategy one has seen with RBOC and Cable >modem deployment, the sort of thing Weirbach decried in his recent >article, and the sort of thing that gets regulator and stakeholder dander up. >(And the sort of market that the article Gordon circulated rightly >notes with derision simply doesn't work in the Internet community). > >>From where I sit, NSI has been trying to build up good will in the >community for the last year and a half or so, doing things like >participating on lists and going out to ISPCON and so forth. Putting a face >on the nameless namer, as it were. Of course, there are folks who will >hate NSI until their dying day, but the majority of folks in the business >world (who >do not labor under the religious convictions that everything in DNS must >be pure of profit motive) recognize that NSI has generally done a reasonable >job of keeping fees low ($70 bucks for a monopoly service is damn cheap, >you pay >more than that for your local phone hook-up or cable modem deployment) and >scaling up with registrations. > >Well, this maneuver pretty much shot its good will efforts to Hell. It >demonstrated for >anyone willing to cut NSI a break that NSI is no more part of the >"Internet Community" >than Bell Atlantic or @Home. I consider this unfortunate, since the >people I deal >with routinely at NSI on this list and in the DNS debate do, I think, >consider themselves >part of the Internet community in a way that Bell Atlantic and @Home don't. > >So what can NSI do to atone for its sins? > >1) NSI should restore the internic.net site to its original pristine form. > >2) It should publicly apologize for acting in such a unilateral fashion with >a net resource. > >3) It should dedicate resources doing active listening for what the community >would like to see, both in terms of NSI services and in terms of opening the >.com, .org, and .net registries to competition. > >4) based on he information gathered in (3) above, NSI >should move to open its databases to real competition. Preferably, >this should be done in concert with ICANN, but ICANN's involvement >is not that important. > >Indeed, this can and should be a humbling lesson for everyone >involved. No one has the power to dictate to the market, the community, >or the significant players, what they can and can't do. We must work together >in a genuinely cooperative manner or resign ourselves to a singular lack of >forward progress. > >Handled properly, this could be NSI's "New Coke," a mistake that ultimately >leaves NSI stronger from the lessons it learns. But this is not a matter of >spin. The Internet community and the market will see traditional spin >for what it is, and conclude that NSI has abandoned its Internet heritage >to become >yet another on-line huckster. But a sincere effort to correct a mistake and >open its market could win respect from all but the die-hards (who will >never stop >fighting the same battles). > >And on this whole "short-seller" nonsense, I suggest checking >out the SEC webpage regarding online investing. One of the >dangers in the world is taking everything said online as true. >It ain't, of course, any more so than what is said off-line is always true. >The notion that because people saying untrue things risk prosecution, >therefore it must be true, is as falacious in this context as it is in the >dietary supplement context. Just as I don't believe claims that wonder herbs >cure cancer, increase vitality, and make you irresistable to the gender >of your choice, a pronouncement that a company's stock is going to >sky-rocket (a scam known as "pump-and-dump") or plummet (a scam >known as cybersmear) should be viewed with skepticism. > >It's tempting to believe that those publishing statements that support our >assesment are automaticly telling the truth, just as its tempting to believe >that those saying bad things about us are deliberately lying. I have no way >of knowing if these guys are telling the truth or not. That they are >short-sellers is >interesting, but doesn't make them liars. It may give them a more >negative view >of the world, or it may make them more realistic. Who knows? But to quote >them as either gospel or devils because they say bad things about NSI >is foolishness. > >As an aside, if you ever get the chance to see John Reed Stark's presentation >on Internet stock fraud, do it! JRS is the head of the SEC's Internet >enfrocement >branch, and he has a 15 minute muti-media presentation that lays >out the SEC's role on the Internet and the most common scams clearly and >in an entertaining fashion. > >So, to sum up my take, NSI did not break the law, violate the cooperative >agreement >steal a public resource, bugger Sox and Buddy, or any of the other heinous >things they are accused of doing. They did, however, commit a public >relations >blunder on par with Viacom's first assualt on the Star Trek fan sites, Intel's >latest privacy gaff, or the FDIC's "know you're customer" regs. One would >expect >better from a company that has been a part of the Internet community for >so long, and >it may be a sign that NSI has grown so large that it now contains too many >PHBs that think of the Internet purely as a "market" working under the >traditional >Madison Avenue rules rather than as a community with specific >expectations. OTOH, >if NSI learns from this mistake, it can (I think) win back trust and good >will of those >who aren't opposed to NSI as a matter of religious belief. To do so, however, >it must abandon the old monopoly models and open itself to genuine >competition, winning its place as first among equals by dint of customer >service >and skill rather than by leveraging a bottleneck facility. > >Harold >
