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Re: [IDNO-DISCUSS] RE: What if ICANN implodes?

Roeland and all,

  Whether or not the ICANN is non-profit or for profit is of little
consequence, although Roeland is correct that non-profits have
a more difficult time getting "Seed Capitol" adequate enough to
get them through the initial stages.  However ICANN was not in this
position from the very beginning..  Again  see:
for further details...

Roeland M.J. Meyer wrote:

> From: Meeks, Brock [mailto:Brock.Meeks@MSNBC.COM]
> Sent: Friday, July 23, 1999 7:36 AM
> ICANN is already "broke."
> During yesterday's testimony, Mr. Roberts acknowledged that
> ICANN is more
> than $730,000 in the RED.  Actually, they owe about $800,000,
> according to
> Roberts.  Of that amount, Roberts said, some $500,000 is owed to ICANN
> lawyer Joe Simms, who has, as yet, not been paid.

WOW! Add that to the ~$600,000 they started with and they've spent
$1.4MUS, in 11 months (~$128KUS, per month), and still no data center.
The other question is who did they borrow the money from? I accept that
they could be self-funding, but at this level?

I have long-since stipulated that there are many practical reasons that
a non-profit wouldn't work, to manage a privatized Internet. One of them
is that non-profits have an abysmal track-record in collecting the funds
they need to start up. It is usually done with a large donor-infusion,
upfront. ICANN doesn't have that (not enough, anyway).

> Ester Dyson, when questioned on how the organization "keeps
> going" said,
> "we're doing what any good compnay does: manage cash flow."
> At which point,
> she was asked, "do you have any cash flowing?"
> "Some," she said.

>From personal check-book to ICANN coffers? Scarey thought.

> But basically, she made it sound like everyone is footing
> their own bill and racking up unpaid expenses.

This is less than good.

> ICANN has STILL not filed its 501(c)3 papers, Roberts said,
> but they are
> doing that soon.  Roberts, I believe, said that the IRS wants to see a
> financial statement first, which now that I recall, isn't correct.

Absolut! Part of the tax filing IS a financial disclosure. I wonder who
they have cooking their books? CPA's typically want cash upfront.

> Anyway, they now have a financial statement, which they consider
> confidential because it wasn't disclosed in public yesterday (at the
> hearing).  From what Roberts said, the financial picture isn't pretty.

>From information that is available, a cash-picture estimate is certainly
possible (I just did one), on a rough scale.

It's too late now, but iff ICANN had formed as a for-profit DE corp, as
was suggested in Sep98, they'd have had Venture funding (VC) a long time
ago. It's a natural infrastructure play and that's what's selling to the
VC right now, as we speak. However, their well is now poisoned, IMHO.
Even if they reformed the ICANN corp, there are very few VC that would
give money to that crowd. The fact that they were stupidly stubborn
enough to even insist on the track they are on, is telling. Their only
hope for rescue is the USG. I may be wrong, but I don't think so.

> -----Original Message-----
> From: Roeland M.J. Meyer [mailto:rmeyer@mhsc.com]
> Sent: Friday, July 23, 1999 3:54 AM
> To: list@ifwp.org
> Cc: brock@well.com; Meeks, Brock; IDNO
> Subject: What if ICANN implodes?
> That was an interesting note from Meeks. What I still don't
> understand,
> with their avowed concern for stability of the net, that NTIA/DOC
> transfered the root to an organization that admitedly has
> only two month
> operating capital left in the bank and NO visible prospects
> for getting
> more and no forseeable revenue stream before the current cash
> stash runs
> out.
> I was at work during the hearings, did someone mention this to the
> congress-critters? I know that we are all expecting ICANN to make $$$
> magically appear. But, if any other contractor, with the USG
> ( and ICANN
> are one), were to fall into such a situation, the last thing the FARs
> would allow is giving them even more responsibility without
> proving that
> they had the $where$with$all$ to stand the gaff.
> I am more and more certain that NTIA/DOC is acting illegally. But,
> IANAL, and therefore not sure about that.
> What if ICANN does go broke, while they control the
> a,root-servers.net?
> Yes, I know that the other root-servers would instantly take up the
> slack, but it's a scarey thought, isn't it?
> If they [ICANN] can continue to operate without visible funding, or
> declaration of additional funds infusion, then ICANN would
> lose whatever
> credibility they have left. At that point, the IDNO might consider
> standing alone, as an independent association.
> This is just something to think about folks. What does it
> mean when the
> ICANN can continue to operate without visible sources of funding, or
> revenue? That should scare the bejeesuz out of everyone.

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Jeffrey A. Williams
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