Say That Again

by Mike Masnick

Why ICANN Needs To Go

from the it's-just-bad dept

Salon is running an interesting interview with John Gilmore where he talks about why ICANN is screwed up and why it needs to be seriously reformed (in the opposite direction, at least, of the reforms they've proposed). The most interesting part of the interview, though, is his history of Network Solutions. It's a story you might not have heard about how huge government contractor SAIC bought them for $3 million, pulled lots of strings, took the company public with shares that had virtually no voting rights, and then (when they realized the monopoly game was up) sold it to Verisign for $21 billion. Quite a story. The rest of the stuff about ICANN has been covered elsewhere, but it's worth reading about again. He talks about why he's helping to finance Karl Auerbach's lawsuit against ICANN. Auerbach, if you haven't been following the story, is on the board of ICANN (though, they wish he weren't) and simply requested access to the company's financial information (a completely legitimate request for a board member), and ICANN is refusing. I've read some of the claims from the ICANN's main lawyer-in-charge, Joe Sims, and I still can't understand how ICANN believes they serve the public any better by keeping everything they do completely secret. If someone can explain that to me, I'd appreciate it.

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  • identicon
    Jared, 2 Jul 2002 @ 7:44am

    Bad Mojo

    I haven't read the article yet but I'd like to offer some insight on SAIC as I have some first and second hand experience with the company. SAIC is not publically traded. It never will be. It is founded on the foundation of being an employee-owned outfit. It was founded in the '60s by a bunch of researchers from the National Lab system. Every employee from the CEO to the loser in the mail room owns shares. Employee benefits are relayed in terms of shares. If you win employee of the month, you get x shares etc. The shares are re-evaluated quarterly by a brokerage house and the employees recieve dividends in addition to their salaries. Also, if you ever leave the company, you have to sell your shares back to the company. If they took a company public, they probably did it to perform some kind of bookkeeping operation. Something like making public undocumented Federal property. (Gov. property rules are complex and I won't discuss them here--but everyone involved with Uncle Sam has to deal with it so you know what I mean.) I would find it hard to villify SAIC for "taking the money and running" given their...unique charter.

    reply to this | link to this | view in chronology ]

  • identicon
    Jared, 2 Jul 2002 @ 7:46am


    You might be intrigued to know that SAIC owns Verisign also. So...they didn't make any money by doing that, they just moved it between subsidiaries. :-) Again, probably accounting cleanup.

    reply to this | link to this | view in chronology ]

    • icon
      Mike (profile), 2 Jul 2002 @ 9:45am

      Re: Also...

      Most of this is explained in the article, but it doesn't say that SAIC retained a stake in Verisign... but that's nothing that can't be looked up. It does appear that following the sale SAIC became Verisign's largest shareholder (9%) stake, but I don't think it's fair to say they didn't "make any money". No matter what you do, turning $3 million into $21 billion gets you something (even if it's tied up in equity)... Besides, it appears that SAIC sold $4 billion worth of VeriSign shares in 2000... So, it's pretty clear they made out very nicely.

      reply to this | link to this | view in chronology ]

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