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    Board of Directors WorldCom's down -- and Cerf's up
    posted by tbyfield on Tuesday June 25 2002, @07:17PM

    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 is, as MasterCard would say, priceless: "'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, is also senior vice president of Internet Architecture and Technology for WorldCom -- 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.



    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 attests:
    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.

    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."

    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 and Senate, ccTLDs alone and en masse, RIRs, venerable networking organizations, NGOs (and not just American ones), Markle, and VeriSign is a partial list -- suggesting that ICANN's metastasis over the last several months is at least irresponsible and at worst plainly bizarre.

    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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    WorldCom's down -- and Cerf's up | Log in/Create an Account | Top | 40 comments | Search Discussion
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    Re: WorldCom's down -- and Cerf's up
    by hofjes on Wednesday June 26 2002, @04:27AM (#7475)
    User #60 Info
    I don't like Vint Cerf because I believe he is arrogant and past his time.

    With that said, however, I don't understand these allegations. Vint Cerf is responsible for Worldcom's Internet architecture. I would imagine he is just largely a figurehead. He is not CFO, nor does he likely manage or review accounting numbers. Worldcom's bad practices have nothing to do with Cerf.

    So many bad things can be said of Mr. Cerf, and there are so many legitimate reasons he should step down as chair of ICANN. All of those legitimate criticisms are diluted by the specious allegations in the post to which I am responding.

    [ Reply to This | Parent ]
    Re: WorldCom's down -- and Cerf's up
    by Buckshot6 on Tuesday June 25 2002, @11:07PM (#7466)
    User #2948 Info
    Looks like *someone* is going to JAIL over this WorldCom mess, just like Enron!


    [ Reply to This | Parent ]
    Re: WorldCom's down -- and Cerf's up
    by RFassett on Wednesday June 26 2002, @03:13AM (#7472)
    User #3226 Info | http://www.enum.info
    when DoC announced publicly last fall that it was "unlikely" that transfer of the root-server system to ICANN would take place, everthing else related to the MoU stopped in its tracks (such as continued fostering of competition). ICANN then started down this path of "reformulating" itself to basically get to the same place as if it had the root server system under its control (and the hammer that comes with it). If my take here is indeed the motivation behind ICANN's actions, is this a breach of its fiduciary responsibility? I do not find the timing of a "case for reform" and DoC's announcement of retaining control of the root server system as mere coincidence. Just my opinion, unconstructive or otherwise.
    [ Reply to This | Parent ]
    Re: WorldCom's down -- and Cerf's up
    by fnord (groy2kNO@SPAMyahoo.com) on Wednesday June 26 2002, @07:11PM (#7515)
    User #2810 Info
    Hmmm, apparently Billy Tauzin's staff is in a huff because Martha Stewart reran a show with him as the guest cook. And Billy has been ICANN watching. In my book, that's far less than 6 degrees of separation (mebbe he was cooking Kevin bacon). And the Auerbach suit leads some to believe ICANN is cooking its books. Y'see it all fits together, it is a conspiracy. -g
    [ Reply to This | Parent ]
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