<nettime> IBM secretly forces Net control into WTO-like trade cabal.

[katie@imt.net]

12/17/99 fr 12:01 pm mst

[Gordon Cook's investigative report uncovers evidence of IBM's secret 
backroom deals to successfully gain control of ICANN and to
force the Net governance structure into a WTO-like trade
cabal.  Introduction and afterward of the January 2000,
COOKREPORT, reposted below.]

In a very long article we summarize our knowledge of the ICANN
debate.  The article  uncovers participants and some of the details
of the secret meeting of July 30, 1999.  This meeting sponsored and
brokered by IBM shows that ICANN, far from being a consensus
organization, is the creature of IBM's need to control the framework
of e-commerce in the 21st century.

Those interested in Internet governance should pay careful attention
to Larry Lessig's new book:  Code: and Other Laws of Cyberspace
(Basic Books, 1999) finds that he who controls the code on which
cyberspace is founded will control whether freedom can exist in
cyberspace. Lessig pounds home this conclusion again and again. We
find it fascinating that Lessig ignores ICANN. For we note the reason
for ICANN's being in such a hurry. It knows what Lessig knows about
ownership and control. It must craft its architectural code on behalf
of e-commerce and government before the rest of us awaken.

Lessig writes "cyberspace [is changing] as it moves from a world of
relative freedom to a world of relatively perfect control' ..... The
first intuition of our founders was right. Structure builds
substance. Guarantee the structural (a space in cyberspace for open
code) and (much of) the substance will take care of itself." . . .
"We are just beginning to see why the architecture of the space
matters - in particular why the ownership of that architecture
matters."


Editor's Preface

ICANN is now "fully formed." With Network Solutions signed on as an
accredited ICANN registrar and obligated to pay it nearly three
million dollars in domain name taxes per year, ICANN need no longer
fear bankruptcy. ICANN may now proceed forward with an Internet wide
system of domain name registration under its control.  It has won act
one.  Whether it will be able to "win" act two and enforce and expand
its powers to become for its masters a global Internet regulatory
agency remains to be seen.

ICANN has gotten to its current position by a complex process of
lobbying in Washington and Europe.  It is one that we have spent the
past three years and upwards of 300 pages of the COOK Report in
documenting.  In this article we review the entire chain of events in
order to paint as accurate a picture as possible of how a tiny clique
has managed to put in place a structure that is now positioned to
become a global regulatory body for the Internet.

This article also covers a July 30 secret meeting run by IBM at a
Washington DC hotel.  At this meeting two IBM Vice Presidents met
with NSI's CEO and a Science Applications International Corp (SAIC)
Vice President in the presence of senior Internet statesmen Dave
Farber, Bob Kahn, Brian Reid and Scott Bradner. ICANN and NSI had
spent the previous two months on a collision course over whether NSI
would have to capitulate to the demands contained in ICANN's
registrar accreditation agreements.  These demands threatened the
viability of nearly all of NSI's income stream.  NSI had both reason
and resources to sue ICANN with both sides having clashed
acrimoniously in front of Congress less than 10 days before.  It is
no exaggeration to say that the fate of both ICANN and NSI was at
stake.

As everyone knows, the suit did not happen and less than two months
later the collision course had become a marriage as NSI signed an
agreement accepting ICANN's control and assuring ICANN of the money
it needed to survive.  It is believed that the July 30 meeting began
the events that led to the late September marriage. We note that at
the most critical moment in the struggle for control of the DNS
system and the future of the Internet the opponents were not ICANN
and NSI.  It was IBM against NSI with John Patrick VP of IBM's
Internet division and Chair of the IBM-MCI led Global Internet
Project backed up by Chris Caine, IBM VP of Government Programs and
head of IBM's 40 person Washington lobbying office.

It certainly looks to us like the crux of what lies behind the
"window dressing" is the raw power of IBM. On December 9 we received
an email containing the following text:

"Gordon: The July 30 meeting was called by John Patrick, who also ran
that meeting. It was attended by John Patrick, Chris Caine, Jim Rutt,
Mike Daniels, Brian Reid, Bob Kahn, Dave Farber, Scott Bradner, and
an ICANN representative. Cerf was not there. It was held at the
Hay-Adams Hotel. My impression of the meeting was that its entire
purpose was to bully NSI into signing ICANN's agreement. It was
entirely Patrick's meeting. Kahn, Reid, Farber, and Bradner were
there as observers. The only negotiations that took place were
between John Patrick and Jim Rutt. As far as I can tell the others
were invited to this meeting for the same reason that Jimmy Carter is
invited to South American elections." [End of 12/9/99 email.]

We contacted some of the people named in this message. When we
reached Reid, he confirmed that he was at the meeting. When we read
him the paragraph above, he asserted that he did remember seeing all
of the aforementioned people at the meeting. He said that "one of the
IBM representatives had asked that the meeting and its contents be
kept secret," but that he "was fairly jet-lagged" and "didn't
remember the details of the secrecy request." He added that "there
ended up being no secrecy agreement, at least nothing written." Reid
described his memory of the meeting as being "a dialog between John
Patrick and Jim Rutt, but [he] couldn't specifically remember any of
the things they had said to each other."  Jim Rutt also confirmed his
attendence at the meeting. He said:   "It was from my perspective a
benign and positive sharing of points of view by some experienced
people around the DNS management issue.  I found it quite useful and
constructive."

Let's identify the persons listed. Mike Daniels is Chairman of the
Board of Network Solutions and SAIC Sector Vice President. John
Patrick is familiar to readers of the COOK Report as the spearhead of
IBM's GIP and ICANN building operation. Chris Caine is Vice
President, Governmental Programs for IBM, Caine is based at IBM's K
Street Washington DC Office. This is Caine's first appearance in the
ICANN NSI saga. We find that appearance to be quite interesting since
Caine's office with its 40 employees is responsible for IBM's
lobbying and government relations programs. His appearance at this
meeting appears to us to elevate the importance to IBM of ICANN's
success. Jim Rutt is NSI's new president. Brian Reid, formerly the
Director of Digital Equipment's Palo Alto networkng Laboratory, is a
researcher in networking; as far as we can ascertain Reid has been a
neutral observer of the governance wars. We describe Dave Farber
throughout this article. Bob Kahn, as co-author of the TCP/IP
protocol with Vint Cerf, has ties to DARPA, the telcos and the
telecom industry in general.  Scott Bradner is an IETF Area Director
and Officer of the Internet Society (ISOC).

We are intrigued by the statement from our informant that "The only
negotiations that took place were between John Patrick and Jim Rutt.
As far as I can tell the others were invited to this meeting for the
same reason that Jimmy Carter is invited to South American
elections."  Inviting men of the stature of Kahn, Farber, Reid, and
Bradner as "observers," may be seen as an act of arrogance. But it
may also have been an act designed to intimidate Rutt and Daniels who
were relatively new to negotiations among top level Internet power
brokers." The very presence of these senior statesmen would serve to
further elevate the seriousness of the discussions.

The July 30, 1999 meeting apparently belonged to the two IBM
Vice-Presidents. The pattern is quite familiar to veteran IBM
watchers who observe that when IBM doesn't know how to cope, it
reverts to its classic pattern of control.  Control of the meeting,
of NSI, of ICANN, and of the Internet, we would add. But the fallout
of IBM's behavior goes well beyond this meeting and stops at the
highest levels of the Clinton-Gore administration.  The relationships
extend back to Al Gore and Mike Nelson who wrote the High Performance
Computing legislation that Gore backed in Gore's Senate days. We
became an observer of Nelson's moves with regard to IBM and Gore
nearly a decade ago and remind readers of the path that Nelson has
traveled from the Senate Commerce Committee to the White House Office
of Science and Technology Policy, to the FCC and finally to
employment by IBM in its governmental relations programs.

The relationships also extend to the National Economic Council's Tom
Kalil who met with Joe Sims and Esther Dyson on June 15, 1999 and
promised to assist ICANN's fund-raising efforts.  We note that Ira
Magaziner explained to us in September 1998 that it was Kalil who (as
part of the White House's preparation for the 1996 elections) asked
him in 1995 to begin his research on electronic commerce and the
Internet.  When in March 1997 we were informed that Kalil was
involved in Becky Burr's refusal to allow ARIN to be formed, we
emailed Kalil and stated that we believed that he had an interest in
seeing Al Gore elected President in 2000.  We stated that his and
Burr's policy on ARIN was in danger of breaking the Internet, told
him why, and warned that if it didn't change and the ARIN issue
exploded, we'd dog his footsteps with public reminders of what he had
allowed to happen. He responded to this email and discussions began
that turned the misguided policy around a few weeks later.

The relationships are tied to the administration's habit of promoting
a public policy that hands off regulator enforcement to industry for
its own 'self-regulation' with the threat that if industry doesn't
self-regulate, the government will step in and do it for them.
Magaziner was a long time proponent of this premise.  Beckwith Burr
from the consummately political law firm of Wilmer Cutler was
espousing it at the Federal Trade Commission in 1995, two years
before she was transferred from FTC to OMB and then to NTIA to wrest
control of DNS and NSI from the National Science Foundation.  It is
now very clear that ICANN is not the legacy of Jon Postel.  ICANN is
the illegitimate off spring of IBM, and the Clinton Gore
Administration - with the assistance of the Internet Society (ISOC)
and Vint Cerf.

The power on the side of those behind ICANN is overwhelming.  It
would be far easier and safer to fold the tent, admit defeat and
disappear into the night.  Yet doing so would be wrong.  Is one to do
what is "safe" or what is "right?"  It is easy to be cynical.  And
likely justified too.  Yet it is hard to abandon the hopes and dreams
of new, individually empowering and more democratic many-to-many
communications.  We write with the hope that while our work may be
unsettling to some readers, it will cause far more readers to stop,
to think and perhaps to re-assess their position.

The Introduction to this article outlines why we hope that those who
have a stake in a free and open internet had better grab the
attention of the press and policy makers before an IBM, Clinton -
Gore administration created and backed ICANN plants itself too firmly
in place.

[more than 20,000 word SNIP]

An Afterword - What, Why, and Wherefore

We have poured many many hours into this article which we view as a
summation of everything we have learned about ICANN.  It would have
been far easier to have ignored the latest events.  But how can one
simply walk away from gathering storm clouds? While we may have
offended some readers, we hope that we will have also made them think.

The Internet forces new ways of doing thinking looking and acting in
many many fields of human endeavor.  Recall the insights of Clayton
Christiansen, the author and originator of the insight that some
technologies are so disruptive that these technologies will lead to
the failure even of established leading edge companies who cannot
cope with them. In these terms the Internet is probably the most
disruptive of all technologies. The power and money at stake extend
well beyond what we could have imagined only a year ago.

The power on the side of those behind ICANN is overwhelming.  It
would be far easier and safer to fold the tent, admit defeat and
disappear into the night.  Yet doing so would be wrong.  Is one to do
what is safe or what is "right?'  It is easy to be cynical.  And
likely justified too.  Yet it is hard to abandon the hopes and dreams
of new, individually empowering and more democratic many-to-many
communications.  We write with the hope that while our work may be
unsettling to some readers, it will cause far more readers to stop,
to think and perhaps to re-assess their position.

It may not be too late, to stop, to think and perhaps to re-assess
one's position if more people begin to support and demand that the
early dreams of the net continue to be respected.  Hubris and the
arrogance of power have brought down would be rulers before. ICANN
displays plenty of both.  We need to take a lesson from the example
of Brian Reid, who is quoted in Where Wizards Stay Up Late:   '"When
you read  RFC 1, you walked away from it with a sense of, oh this is
a club that I can play in too. It has rules, but it welcomes other
members as long as the members are aware of those rules.' The
language of the RFC was warm and welcoming.  The idea was to promote
cooperation, not ego." [Editor:  We contend that 30 years later what
stands in opposition to cooperation is raw economic, self-justifying
monopoly power in the case of modern IBM.]

"The fact that [Steve] Crocker kept his ego out of the first RFC set
the style and inspired others to follow suit in the hundreds of
friendly and cooperative RFCs that followed.  'It is impossible to
underestimate the importance of that,' Reid asserted.  'I did not
feel excluded by a little core of protocol kings.  I felt included by
a friendly group of people who recognized that the purpose of
networking was to bring everybody in.' . . . . The RFC, a simple
mechanism for distributing documentation open to anybody, had what
Crocker described as a 'first-order effect' on the speed at which
ideas were disseminated, and on spreading the networking culture."

Reid has squarely identified the standards of behavior that made the
Internet so strong and so special.  Behavior that is completely
antithetical to the ICANN way of pigeon-holing people in committees
to isolate and render them impotent. We urge our readers to sit down
with Lessig's Code and Other Laws of Cyberspace, which is both a
prophecy and a correct analysis of what may come.  The Internet must
find a way to route around IBM's and the White House's ICANN.
****************************************************************
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)            Is ICANN an IBM e-business ?
cook@cookreport.com                     See also Lessig's Code: and
Other  Laws of Cyberspace  http://cookreport.com/lessigbook.shtml
****************************************************************



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