<nettime> ICANN Watch: WorldCom's down -- and Cerf's up

["nettime's_roving_reporter" <nettime@bbs.thing.net>]

    [i posted this story to ICANN Watch less than 24 hours ago, and in 
     that time the SEC has already filed fraud charges against worldcom:

     <http://cbs.marketwatch.com/news/story.asp?guid=%7BA4A25DF1%2DADB9%2D4D61%2DB481%2D85C0CB786786%7D&siteid=mktw>.  

     highlights:

        The Justice Department, fresh off its victory in the Andersen
        obstruction-of-justice trial, said it would explore potential
        criminal charges against WorldCom and its senior-level executives
        [...]
        The SEC also is seeking to bar certain WorldCom executives from
        ever serving as directors or officers of a publicly traded company
        and force them to disgorge any profits from stock sales.

        For its part, WorldCom's board hired William R. McLucas, a former
        SEC enforcement chief with the law firm of Washington-based Wilmer,
        Cutler & Pickering, to conduct an independent investigation of the
        matter. 

      curiously, WC&P happens to be knee-deep in DNS politics. -- cheers, t]


<http://icannwatch.org/article.php?sid=833&mode=thread&order=0>

WorldCom's down -- and Cerf's up
Posted by tbyfield on Wednesday, June 26 @ 00:17:36 MDT
Contributed by tbyfield

Buckshot6 noted a breaking news item: WorldCom, it seems, spent the last
five quarters overstating its cash flow by **$3.8 billion** in what the
*New York Times* has called "one of the largest cases of false corporate
bookkeeping yet." WorldCom's press release[1] is, as MasterCard would
say, *pricelessi*: "'Our senior management team is shocked'" -- shocked! --
"'by these discoveries,' said John Sidgmore, appointed WorldCom CEO on
April 29, 2002. 'We are committed to operating WorldCom in accordance
with the highest ethical standards.'" Uh, yeah... And, aside from
driving Yet Another Really Big Nail into the high-tech bubble that ICANN
has ridden to ill-deserved prominence, what's this got to do with ICANN?
Well, someone has to be crass enough to point out the glaringly obvious
fact that ICANN's chairman, Vint Cerf,[2] is also senior vice president
of Internet Architecture and Technology for WorldCom[3] -- that is,
senior management of what would appear to be a borderline criminal
organization. If that seems like rough stuff to say, well, tell it to
the thousands and *thousands* and **thousands** of people who'll be
paying a very heavy price indeed for WorldCom's apparent malfeasance --
including the 17,000 people the company plans to start laying off on
Friday.

     [1] http://www.worldcom.com/about_the_company/press_releases/display.phtml?cr%2F20020625
     [2] http://www.icann.org/biog/cerf.htm
     [3] http://www1.worldcom.com/global/resources/cerfs_up/personal_perspective/principles.xml

To ears deafened and eyes blinded by the bad habits of the American
media, the fact that ICANN and WorldCom have Cerf in common might seem
at worst somehow vaguely unfortunate. And in a certain way it is, as
Cerf's statement about the principles he's lived by[4] attests:

     [4] http://www1.worldcom.com/global/resources/cerfs_up/personal_perspective/principles.xml

     One of the key principles for which I have high regard is integrity and
     honesty. I prefer to speak plainly and prefer people who do so as well.
     Sometimes this can be painful, but I would prefer the pain of blunt
     honesty to the anesthetic of diplomatic dissimulation.
     
     I've been confronted with conflicts of interest, especially as chairman
     of the Internet Architecture Board or as President of the Internet
     Society or as program manager in the Defense Advanced Research Projects
     Agency. In those cases where endorsement of a particular product or
     vendor might have produced significant material gain, I chose not to
     invest, not to accept compensation, and either to remain silent or to
     speak my opinions unburdened by conflicting personal interest.
     Occasionally I have regretted this position, for what might have become
     substantial assets, but avoiding the conflict always seemed the right
     thing to do.

What's at once odd and admirable about this statement is its omission of
the -- again, glaringly obvious -- contribution that Cerf, famously a
"founding father of the internet," has made. But the flipside of that
omission, which is neither odd nor admirable, is that as a mainstay
turned chairman of ICANN, Cerf's contribution has been, in a word,
shameful. He has actively supported and presided over years of sophistry
and chicanery -- and, I daresay, "the anesthetic of diplomatic
dissimulation." And he's been told as much in no uncertain by, among
others, John Gilmore.[5]

     [5] http://icannwatch.org/article.php?sid=763

As long as this remained within the freewheeling and discursive context
of ICANN, that was fine, in a way: though the inner sanctum of ICANN is
as opaque as sheet steel, the larger environment of the surrounding
debates have set a tremendous (one could even say, without exaggeration,
*historical*) example of what open public debate and input could be and
mean. This is **not** to ICANN's credit: that was the terrain, and
anything less would have been laughed off the net, then laughed off of
FidoNet, then laughed off sneakernet to boot.

But when it comes to the larger environment of which ICANN is a small
part -- the "revolution" in ICT -- things get much more serious. We're
only beginning to see just how slimy is the grease that's lubricated the
wheels of this "post-industry." And that is where the American media has
been failing us (Americans, at least) in desperate ways, for the problem
is not reducible to a generation of young-turk dotcommies or a few
executive scoundrels. On the contrary: it's a systemic crisis in what
even conservative voices such as *Financial Times* call "corporate
governance."[6]

     [6] http://search.ft.com/search/totalSearch_Form.html?vsc_appId=ts&symb=&ftsite=FTCOM&searchtype=equity&vsc_query=%22corporate+governance%22&searchOption=news

Frankly, it's astonishing that no one has put two and two together well
enough to ask generally whether or how ICANN's *root* problem is related
to the slack pseudo-oversight that's been bringing down one star after
another of the so-called new economy -- and to ask in particular about
the role that variously soporific and self-dealing boards of directors
have played in these fiascos. As far as I can tell, if there was a
poster child for a negligent board, ICANN's board is it -- and Cerf is
the chairman of the board.

ICANN Watchers needn't accept my word in this regard. The last weeks
have seen a stunning parade of organizations -- the U.S. House[7] and
Senate,[8] ccTLDs alone[9] and en masse,[10] RIRs,[11] venerable
networking organizations,[12] NGOs[13] (and not just American ones[14]),
Markle,[15] and VeriSign[16] is a partial list -- suggesting that
ICANN's metastasis over the last several months is at least
irresponsible and at worst plainly bizarre.

     [7] http://icannwatch.org/article.php?sid=821
     [8] http://icannwatch.org/article.php?sid=781
     [9] http://icannwatch.org/article.php?sid=811
     [10] http://icannwatch.org/article.php?sid=830&mode=thread&order=0
     [11] http://icannwatch.org/article.php?sid=818
     [12] http://icannwatch.org/article.php?sid=805
     [13] http://icannwatch.org/article.php?sid=772
     [14] http://icannwatch.org/article.php?sid=596
     [15] http://icannwatch.org/article.php?sid=815
     [16] http://icannwatch.org/article.php?sid=825&mode=thread&order=0

So now that WorldCom has as much as admitted that it has earned a
starring role in the rogues gallery of lying, thieving corporations,
it's time to pose the question squarely to its senior veep and ICANN's
chair: Is ICANN's board fulfilling its fiduciary obligation? Not to the
"stability" of the net, no: only the most deluded denizen of Marina Del
Rey actually believes that if ICANN went away, the internetworked world
would do anything but prosper. No, rather, has ICANN's board been
fulfilling its fiduciary obligation to ICANN *itself*?

The fact that one director is suing over what he alleges, compellingly,
has been a systematic campaign to deny him access to basic financial
data would seem to suggest that the answer is no in a big way. Because
that case is current, Cerf can take the easy -- indeed, cheap -- way out
by maintaining his silence. But he needs to ask himself whether doing so
ultimately lives up to his own professed ideals about what's the right
thing to do.

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