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Who's going to control the 'Net?
This was a special mailing from the TELECOM Digest this morning.
It's interesting to see the fighting that's going on over who's
going to end up having control of the 'net.
I'll forward the rest of the posting when it comes out tomorrow.
----- Forwarded message from TELECOM Digest Editor <[email protected]> -----
Date: Wed, 1 Sep 1999 23:43:29 -0400 (EDT)
From: TELECOM Digest Editor <[email protected]>
To: [email protected]
Subject: What Vint Cerf and Esther Dyson are up to These Days
This special mailing from TELECOM Digest is in the public
domain. You are encouraged to share it with other mailing
lists and newsgroups as appropriate. *Please do not spam*
in the process of doing so, but it is your net after all,
and netizens deserve to be kept informed, even if those
who approach the vice-president of the United States saying
they 'represent all users' don't want you knowing what
they are doing or getting in the way.
Gordon Cook of Cook Report has kindly forwarded to me some email of
interest; email between Vint Cerf and others in the clique known as
ICANN, the Internet Corporation for Assigned Names and Numbers.
Internet Society, another tightly controlled clique, is a separate
organization, but essentially the same people control each, like two
peas in a pod, as the saying goes. Tomorrow, I have a bit more, and
the day after that, more also. If/when/ever Cerf, Dyson and others
want to join us at user level to discuss the great giveaway of the
internet, I'll happily be quiet and give them the floor.
Rebuttals and responses of course will be quite welcome. My sincere
thanks to Mr. Cook for sharing his notes.
Date: Wed, 1 Sep 1999 17:47:21 -0400
From: Gordon Cook <[email protected]>
Subject: Follow the Money: an Inside View of ICANN Fund Raising
The COOK Report has received the full text of nine email messages
detailing ICANN's efforts in June to stave off bankruptcy. It has
obtained independent verification that they are messages that were
given by ICANN to the House Commerce Committee Subcommitte on
Oversight and Investigations that held hearings on July 22. The
e-mail below makes very clear that ICANN's support is focused largely
within IBM, MCI, Cisco, and the Executive Office of the President of
the United States.
MCI's Vint Cerf and IBM's Vice President of Internet Technology, John
Patrick show themselves as the masterminds of a campaign to collect
funds from internet related companies. The guise is that without
ICANN the Internet cannot function smoothly and "if ICANN fails
e-business/e-anything is in jeopardy." The messages show the grasping
self-serving mindset of the ICANN clique -- one that is useful to
contrast to their avowed stance of public interest coordination of
Internet technical functions.
ICANN has constructed an edifice of Byzantine complexity to do a job
that six people are doing now for a cost of about $600,000 a year
including equipment and overhead. Those who have not bought into its
centralized, control-oriented mindset maintain that it is a job that
does not need to be done and is one that will allow a handful of huge
corporations to dominate the formerly decentralized entrepreneurial
workings of the Internet. The Internet is functioning quite well
Congress must ascertain what has motivated ICANN's core supporters, a
group of only four people: Vint Cerf, John Patrick, Esther Dyson, and
Mike Roberts to claim that the Internet is in danger? Do we really
want the Internet, which is functioning perfectly well, run by an
unaccountable bureaucracy staging a global road show and spending
annually some ten times the current amount that gets the job done?
Two legacy companies, IBM and MCI, are at the heart of a gambit to
build -- with the aid of other legacy operations like Netscape and
AT&T, and the hangers-on of the failed gTLD-MOU, IAHC, Core group --
an unaccountable operation that is at heart antithetical to the
interests of the globally expanding entrepreneurial Internet.
Leaders of most other internet companies, seeing through the
Cerf-Patrick subterfuge, have not contributed to those directing the
ICANN gambit. Unfortunately, Cerf, Patrick, Dyson and Roberts didn't
get the message that should have been delivered by their last years
worth of fund raising efforts. ICANN should be put out of its misery
and the Internet left to run itself.
The lessons taught by ICANN will provide strong motivation for domain
name registrars and the regional IP number registries to contribute
the six to seven hundred thousand dollars a year necessary to keep
IANA functioning. Left to its own devices we will find that the DNS
registry/registrar industry will be able (perhaps with some congress-
ional guidance) to form an association. We shall see that this
association will be able to operate multiple root servers in a way
that will prevent most conflicts and that by letting the market place
actually operate we shall quickly gain a larger and more stable DNS
The inner circle of ICANN is amazingly narrow:
MCI-WorldCom (Vint Cerf & John Sidgemore);
IBM (John Patrick, Roger Cochetti, Mike Nelson & George Conrades);
Mike Roberts (who at Educom was beholden to IBM funding);
Esther Dyson (known as one of the most influential persons in the
Joe Sims (anti trust attorney for the powerful law firm of Jones and
Tom Kalil (the group's White House liason to the highest levels of the
An SOS from IBM and MCI WorldCom Falls Flat
The ICANN Papers begin with a June 7th Mike Roberts message to Mike
Nelson, Roger Cochetti and Vint Cerf:
"Esther and Joe and I are not quitters, but reality suggests that
unless there is an immediate infusion of $500K to $1M there won't
be a functioning ICANN by the end of August. There are various
approaches that have been kicked around in the last several months
- a second round from current supporters, a special appeal to those
who have not given yet, a loan of some kind. I don't think those
of us on the ICANN side have a preference one way or the other."
On the same day Vint Cerf replied in a message showing the unusual
length that he was prepared to go to salvage ICANN as an MCI/IBM
Cerf: "I have talked with John Sidgmore. We will try to get $500K
at least "backup" in case nothing else in the way of fundraising
works. Mike Nelson, I have copied John Patrick and Irving
Wladawsky-Berger [Editor: an IBM e-commerce executive] on this
message, as well as John Sidgmore. If IBM and MCI Worldcom can
come up with $1M in "bridge" funding, to be paid back at a later
time under reasonable terms that will not harm ICANN, then perhaps
we can begin a new fundraising campaign knowing that we have the
ability to back up the campaign with a rescue effort in the short
term. It will be easier for John Sidgmore to make the case to the
MCI WorldCom management if IBM is willing to go into this with us
and split the $1M cost. Is it possible?
"I would then launch a campaign with GIP, ITAA, Internet Society,
and other interested groups on the basis that
[TD Editor's emphasis]
*ICANN must succeed or Internet will be in jeopardy. This ought
to play well with any company whose stock price is dependent on a
well-functioning Internet." "Thoughts?"*
[end TD Editor's emphasis]
Having failed to get sufficient money to support ICANN from outside
sources, Vint returns to the IBM/MCI duopoly of the Global Internet
Project which since its 1997 launch has featured Patrick and Cerf as
the prime movers. An October 1997 news story from Reuters made a
candid announcement of the intentions behind the GIP:
"Internet Companies Welcome Idea of Global Charter BRUSSELS
(Reuters) - A group of U.S., European and Japanese companies
involved in the Internet informally welcomed a European Union
proposal to draw up a charter to govern the global computer network.
The companies, who have united as the Global Internet Project (GIP),
said they wanted to be involved in the process [of the global
From the vantage point of two year's hindsight it is clear that ICANN
is the charter of the GIP for governing the global computer network.
This is the carefully crafted tool of control that Cerf and Patrick
fear the loss of. The lengths to which Cerf is ready to go to
salvage his creation are quite extraordinary:
"I would then launch a campaign with GIP, ITAA, Internet
Society, and other interested groups on the basis that ICANN
must succeed or Internet will be in jeopardy. This ought to play
well with any company whose stock price is dependent on a well-
The reader will note the willingness to use fear, uncertainty, and
doubt to manipulate other players to reach for their check books if
only to maintain a public perception that things are under control.
Note also that ITAA is the Information Technology Association of
America, a Washington DC lobby for American IT companies. ITAA Vice
president Jon Englund has for the past year been enlisted to use the
ITAA as a platform for ICANN support, although the effort has been
reasonably quiet -- reaching its highest profile when ITAA gathered
the copyright and trademark interests in a January, 1999, Washington,
DC meeting to influence the formation of ICANN's Domain Name Support-
ing Organization. Vint's feel of control over ISOC, ITAA, and GIP
and his willingness to put his reputation on the line is impressive.
On June 8th, John Patrick was correctly worried that with only MCI
and IBM squarely behind the GIP effort, there would be an impression
of big corporate capture of ICANN. Possibly motivated in part by the
fact that George Conrades and Esther Dyson have their own venture
capital operations, Patrick wrote a dunning letter to Silicon Valley
area VCs. The Patrick letter contains some telling admissions:
Patrick: "ICANN is trying to get the policy, technical and
financial aspects of the Internet moved successfully from U.S.
government to the international private sector. Everyone
thinks this is a good idea. In fact, I would say that the
future of the Internet is dependent on the execution of the plan."
Consider carefully his words.
Remember that Esther was recently chiding Dave Farber not to call
ICANN the Internet's "Oversight Board" since ICANN's purpose was
nothing more than dealing with a subset of technical coordination. On
June 13 Patrick, writing in assumed privacy to venture capital fund
directors, paints a different and very broad picture of control:
"the policy, technical and financial aspects of the
Internet to the international private sector."
Speaking in public ICANN has always denied an interest in policy and
financial control. In Patrick comes on with great urgency:
"Not to sound alarmist, but if ICANN fails e-business/
e-anything is in jeopardy. This means your future investments
and your past ones."
Explaining why getting money from small companies will take too long
and that getting money from large ones, "creates problems of "big US
companies trying to dominate/control the Internet". Loan guarantees
might be an angle, but they present complexities for companies to
provide them. You guys and your vc colleagues have created incredibly
creative financings for many $billions of Internet opportunities.
Could a handful of you jump in and help solve this relative trivial
financial hurdle to your future?"
It seems that John never stopped to realize that his VC audience
looked for return on its investments, and that they might have their
own opinions on the soundness of fronting for ICANN. Further those
who were sure only had to call the CEO's of companies they funded.
These men and women would be quite ready to give their own
interpretation of the Patrick letter. Judging by the events that have
unfolded with ICANN getting loans from Cisco and MCI, ICANN failed the
VC risk analysis test. (As far as we can tell it also failed the IBM
test. Despite Patrick's pushing IBM seems not have loaned ICANN
anything -- evidence of remarkable shrewdness on the part of those
On June 14th George Conrades of Polaris Ventures, CEO of Akami
Technolgies, and an ex-IBM vice-president asked Patrick where IBM
itself stood on ICANN. (Tellingly, Conrades, whom we have always
considered IBM's representative to the ICANN board, was the only
ICANN Board member besides Esther Dyson involved in these discussions.)
George was quite blunt:
"Is this a challenge IBM would take on? I realize potential
downside to ICANN perception (capture and all that) but what
about a "United Way" kind of involvement/support."
On June 15th with things apparently not going well the ICANN Keystone
Cops turned to the White House. While Al Gore did not found the
Internet, he has always been supportive of investment in it on the
part of the US government and the part of IBM. My first acquaintance
with Mike Nelson, (John Patrick's lieutenant) came at the US Congress
Office of Technology Assessment in the fall of 1990 when I was hired
to craft an assessment of the National Research and Education Network.
Nelson at this point was Gore's technology staff person and was author
of the High Performance Computing Legislation eventually passed by
Congress in 1992. After 18 months experience with Nelson (late 1990
to early 1992) Mike's loyalty to IBM became very clear. My only
surprise has been that it took quite a number of years before he went
to work for them directly last year.
Kalil has always been the chief IT staff person on the National
Economic Council in the Executive Office of the President. Ira
Magaziner turned to his study of the Internet in 1995 under Kalil's
tutelage. Tom has also had a major responsibility for the Next
Generation Internet project. Although my evidence is circumstantial,
it appears to me that he is the primary link between Clinton and Gore
and Becky Burr in the Commerce Department.
We find Joe Sims, ICANN's high powered anti-trust attorney reporting
on June 15 to [email protected]:
"Esther and I met with him today, and he promised to do
what he could to promise what he could to encourage private
donations to make it clear that we are not going to be finan-
cially starved for the foreseeable future. He said it would
be useful to have emailed to him information on the budget, work
plans, etc. - the kind of stuff that he could give people to show
them that we have a real live operation here."
And on June 17 Mike Roberts writes to Kalil:
"Tom, pleased to hear about your offer of help to Esther and
Joe. There are three current documents that may be of use to
you. (In addition to Esther's letter to Nader, which lays out
the current terms of political engagement.) One is a six month
status report from ICANN to Commerce, which carefully lays out
what we have been doing and why. The second is our budget pack-
age for next year, starting at 7/1/99, which details what the
projected income is and what it is going to be used for.
"The third document is a private and confidential financial
statement based on actual results as of 6/15/99 and projected
to fiscal year end at 6/30/99 the most salient figure on this
schedule is a negative net worth of $727,954 at June 30. I'd
be happy to fax the entire schedule to you if you give me a
number for a machine where the schedule won't get loose. I'm
discussing it with the CFO of Cisco tomorrow and with MCI as
well, with respect to second round of financial support. Let
me know if I can provide additional help."
What Happens Next?
In view of the bold ideas about the need to wake up corporate America
because nothing less than the fate of the internet is at stake, its
amusing to note that only the CFO of Cisco and Vint Cerf's MCI
delivered money ($650,000) at 7% interest.
ICANN tried to keep what it was doing quiet.
Suddenly on August 17 much delayed minutes of the July 26 ICANN Board
Meeting appeared on the ICANN web site where at
http://www.icann.org/minutes/minutes-26july99.htm we read
" WHEREAS, the Board of Directors has determined that it
is in the best interests of the Corporation to borrow up
to US$2,000,000 on an unsecured basis at such rates;
RESOLVED [resolution 99.64], that the Corporation is
authorized to borrow the aggregate principal amount of
$2,000,000 from various lenders selected by the Interim
President and Chief Executive Officer on an unsecured
basis, at interest rates not to exceed seven percent per
annum, with repayment terms of not less than one year, and
on other terms and conditions substantially as set forth
in Exhibit A hereto."
To cover the movements described in this article the board gave its
RESOLVED FURTHER [resolution 99.69], that the authority
given in these resolutions is retroactive and any and all
acts authorized herein performed before the passage of these
resolutions are ratified and affirmed.
Brock Meeks story on the ICANN fund raising appeared the following
day August 18 and on August 20th ICANN announced that it had
"received loans in the amount of $500,000 from MCI WorldCom and
$150,000 from Cisco Systems. These funds, which will be put toward an
overall target of $2 million, will enable ICANN to temporarily meet
its expenses until permanent funding is secured."
Of course what ICANN did with the funds when it received them is
instructive: It paid $800,000 in invoices from its fiscal year ended
June 30, 1999. See
ons-through-8-31-99.html Of the $800,000 in invoices $500,000 was from
[TD Editor's emphasis]
Joe Sim's Jones and Day Law Firm. Services rendered by what
last summer war announced as ICANN's probono attorney.
Tony Rutkowski commented to BWG: ICANN appears to have been
created, manipulated, and propped up substantially by John
Patrick and Vint Cerf who have never had any public accountability.
[End TD Editor's emphasis]
"I'm not aware that either has ever publicly explained what they
are doing and why, much less participated in any forum -
electronic or otherwise - where anyone substantively knowledgeable
could interact with them. Indeed, it has long made a mockery out
of all these public discussion and even the government's own
public processes, when the real deals were all being worked out
behind the scenes by others to meet their unknown objectives. Has
anyone been able to ever engage them on these matters or heard an
Did Al Gore Create or Give Away the Internet?
While Al Gore may not have created the Internet, the above
correspondence makes clear how on his watch, his trusted lieutenant
Mike Nelson has been a participant in a Clinton-Gore administration
sanctioned give away in the words of IBM's John Patrick of "the
policy, technical and financial aspects of the Internet to the
international private sector."
While ICANN has been a closed door black box, the Europeans do have
three members (Capdeboscq, Kraaijenbrink, and Triana) of a ten member
board. Before they sit back with satisfaction that Christopher
Wilkinson (a GAC member representing the EU) has their interests
adequately protected, they need to read and ponder carefully that
ICANN, when the rubber meets the road, is a strictly American operation.
We have one last chance. The House Commerce Committee is not through
with its investigation. Mikki Barry submitted 30 pages of answers to
their questions last week.
Found at http://minion.netpolicy.com/dnrc/82799cong.html
the testimony makes quite it clear how badly the Clinton,
Gore, Kalil lead NTIA has gotten in over its head in letting
Patrick, Cerf, Dyson and Roberts dispose of technology inter-
*should be serving all Americans and all American
business rather than this tiny clique of insiders.*
While NSI may be non-responsive, ICANN is the far bigger stench. Our
current executive branch leaders have badly failed us. It is time for
Congress to take over. Including Senator McCain on behalf of the
Senate Commerce committee.
The committee should subpeona Cerf and Patrick and find
out just what they had in mind when they warned of
Internet instability and the failure of E-commerce if
ICANN doesn't get its way. Reading the ICANN Papers we
can only wonder at the private personna shown here by
Cerf and Dyson in contrast to their public postures of
the "Internet is for everyone" and "champion of the
But there are additional contrasting forces at work. The gap between
the innocuous public role claimed for it by ICANN's supporters and
the lengths to which powerful men like Cerf and Patrick are willing
to go on its behalf, carries with it the odor of deception. If ICANN
is so essential to the survival of the Internet, they should be
willing to engage in open debate in its support. The fact that they
have hidden for a year from any public debate where they cannot
control the terms says that their real agenda could not survive
A strong hint of the likely real agenda came in one of the
resolutions from the Santiago meeting where ICANN announced the
Formation of [an] Ad Hoc Group.
"RESOLVED that the Interim President and CEO, working
with Director Kraaijenbrink, is directed to establish
an ad hoc group to be charged with developing the
objectives and proposing structures for future policies
in the area of numbering, especially as required to meet
global market needs and taking into account the convergence
of information technology services and networks."
[Editor: ad hoc group being formed is in response to the August letter
to the ICANN Board sent by ETSI and ETNO. The letter indicated a vote
of no confidence in the ability of the three regional IP number
registries to hand out IPv6 addresses.]
On August 31, Jim Dixon, Telecom Director for EuroISPA, commented to
the BWG list:
"'Numbering' and 'Global'. That's two magic words in a row.
In telephony and governmental circles, "numbering" policies
are those that relate to the allocation of telephone numbers.
I read this as a suggestion that a global policy for the all-
ocation of numbers can be created, with telephone number
allocation becoming more or less a detail in the larger problem
of allocating IP address space. This actually makes a great
deal of sense. Certainly if we have 128 bits of IP[v6]
address space 13 or so digits of telephone numbers can be
tucked in there without anyone even noticing it."
"And everyone in either of the businesses can see the "convergence"
of the Internet and telephony and all of the activities associated
with both. My company (an ISP) got its telco license six months ago.
The dominant telco (British Telecom) drags out the process, but we
expect to have an active interconnect in a couple of months. I'm not
familiar with how this sort of thing works in the States,
[TD Editor's emphasis]
but I expect that most of the larger ISPs in the UK
will be telcos inside of three years," Dixon concluded.
[TD Editor end of emphasis]
The ICANN resolution concluded:
"The group will include representatives of businesses,
including telecom operators and Internet service providers
and trade organizations, the ASO Council, the ICANN Board,
and other legitimately interested parties. The group will
present an interim report before the ICANN public meeting in
2000. A final report from the ad hoc group will be presented
to the ICANN Board prior to the Annual Meeting in 2000."
Dixon: "To me this is the first sign of any imagination on
the part of the ICANN board. Up to now it has just been
fumbling around, trying to take over the domain name system
in a confused and rather grandiose way. But this looks like
the Board is beginning to grasp the possibilities: if enough
people are careless enough, ICANN just might be able to get
control of the entire global telecommunications system.
Worth trillions, I should think."
This message contains a strong hint of what may be troubling Vint
Cerf when he fears for the future of the Internet if ICANN doesn't
survive. Perhaps his fear is just a code word for his concerns for
MCI WorldCom, a legacy telco if there ever were one.
MCI WorldCom is not a greenfield carrier. As shown by the 10 day long
collapse of its frame relay network in August, it contains a dizzying
array of acquired legacy networks that will be very costly for the
debt belabored enterprise that Bernie Ebbers has built to upgrade.
An ICANN that could control IPv6 allocations on behalf of the interests
of such companies could be an invaluable resource to someone in Cerf's
Whatever happens to MCI, Congress must be made to
understand that a bankruptcy of ICANN as the failed
private preserve of Cerf and Patrick is in the public
It must realize that someone like the Markle Foundation could provide
necessary funding for IANA and that the domain name camp needs to
start over to rebuild its house this time in an open and truly
democratic way. We can still hope that Network Solution might seize
the opportunity present by ICANN's betrayal of trust to reform itself
in the interests of the Internet community as well as its stock
holders. Above all Congress must do its homework and come to the
realization that the biggest danger for the Internet and for American
technology is to fall victim to the myth that a single group needs to
The Triumph of the IP Insurgency or of ICANN?
What I wrote on January 29, 1999 is even more true on September 1.
Even so, knowing that the IP Insurgency is now so close to total
triumph in undermining the old telecom order, we would be naive not to
consider the possibility that more serious intentions lay behind the
conservative, old line computer companies, and ITU-oriented telco
interests that control ICANN. There can be no proof that ICANN will do
evil because ICANN is not yet fully constituted, and has not yet been
given NTIAs' final blessing.
But make no mistake about it, the legal and operational framework that
[has been] built for ICANN has been structured such, that it will be
quite possible for ICANN to implement rules designed to blunt and slow
down further innovation of the IP insurgency under the guise of
"management of public resources on behalf of the alleged common good."
While the world's legacy telcos and computer companies may be slow to
innovate, they are run by people intelligent enough to realize that if
they can't win on technical merit, ICANN may be their last best
hope. ICANN looks destined to become the first Internet international
regulatory body. Therefore the legacy computer companies and legacy
telcos of the world have ample reason to want to gain direct or
indirect control of ICANN. Such control may be their only way to see
that the IP insurgency doesn't run them out of town.
But something even more profoundly important is at stake. The
technologies of the industrial age raised the economic barriers for
anyone wanting to start a business beyond the range of most ordinary
Americans. Because our culture and history has long preached the
virtues of self-reliance and economic independence, this was hard for
most of us to swallow. It was the small cost and enormous power of
the personal computer hooked to a modem that, for the first time in a
century, re-opened the door to individual freedom and economic self-
But this re-opened door is a profound threat to both those business
interests that seek monopoly market power and those whose livelihood
depends on social and political control of the masses. These people
fear the Internet and are determined to find a way to control
it. ICANN, as constituted, represents the last best hope of achieving
their misguided goals.
The COOK Report on Internet Index to seven years of the COOK Report
431 Greenway Ave, Ewing, NJ 08618 USA http://cookreport.com
(609) 882-2572 (phone & fax) ICANN: The Internet's Oversight Board -
[email protected] What's Behind ICANN's Desire to Control
the Development of the Internet http://cookreport.com/icannregulate.shtml
[TELECOM Digest Editor's Note: And there you have, in Gordon Cook's
more eloquently phrased style than I could hope to accomplish, what
I have been trying to say here for quite some time. I tried saying
it without mentioning any names or organizations. Then I tried it
with a couple of hints. Then I mentioned Internet Society (of which
Vint Cert is an officer) and now I guess it just comes down to
names and blunt statements:
ICANN, Internet Society, Vint Cerf, Esther Dyson and others as
mentioned above want control of the internet. They represent very
large business interests. You and I are not part of their plans;
in fact, we are actually in the way. Pay no attention to the
mocking statement on the ISOC web site saying that 'the internet
is for everyone' ... not quite ...
This is the first in a series of messages. Tomorrow we will have
more pontifications from Vint Cerf and a discussion of the 'Esther
Dyson tax' ... a plan to tack on a dollar to the registrar's fee.
Quite (I hope) obviously, anytime Cerf, Dyson or others in their
little clique want to respond, or actually begin a net-wide
discussion of their plans, I'll be privileged to print anything
they want to say.
----- End forwarded message -----