A-Clue.Com
(formerly "A Clue...to Internet Commerce")
by Dana Blankenhorn
Volume II, No. XXIV
For the Week of June 15, 1998
 

This Week's Clue: Enforceable Jurisdiction 

SSP (Shameless Self-Promotion)  

Yahoo (But Can They Execute?) 

Protecting Privacy 

Whoo Are You (Boop-boop, boop-boop) 

Clued-in, Clueless

This Week's Clue: Enforceable Jurisdiction  

Eventually, all online controversies devolve to a simple question - who decides? It's not an easy question, even for the most libertarian among us. 

The libertarian answer to most things is, of course, "the market" - the great invisible hand. That answer is at the heart of the latest NTIA  white paper on domain name issues. Under this latest Magaziner plan, the Internet Assigned Numbers Authority, which already maps 12-digit numerical addresses to named Web domains, would be an interim authority, and the new structure would debut in October, 2000. This interim step reverses the current control of Internet naming, where numbers are assigned after names. (It would hopefully end those silly "Oklahoma Sooner" ads from Network Solutions  that have done so much lately to sow panic among U.S. businesses.) Putting both numbers and names in one set of hands at least makes naming decisions enforceable. 

After this point, it all gets murkier. Will we have more TLDs or not? Will national domain authorities (some of which have already been privatized) have to submit to IANA's will? More important, who'll decide what's the most appropriate TLD for you? Right now everyone wants to be .com. But if your name's no longer available there, anyone can become a .net or .org, and who's to say no? In theory, the World Intellectual Property Organization (WIPO) would study all this. Interesting theory, but what happens in the real world while the study goes on? 

As I've said repeatedly, domain name problems really come before the dot, not after it. If .com is saturated, it's only because name prices are so low that typos are worth buying for the ads they generate by accident. The real problem it seems to me, is no one says no to inappropriate domain name requests, so an outfit like Hatewatch  gets ripped-off by professional haters - and what do you do when your kid stumbles on that last site? 

But if someone is going to say no, who will it be, and who will control that power? We've already seen disasters where NSI refused requests for domains with "dirty words" in them - but only when those dirty words were expressed in English. (No help for those offended by the German or Italian versions of these expressions.) More important, will WIPO find a way to protect your name across all domains, and make sure that .nets are networks while .orgs are real organizations? If it gets that power, could it then use it to eliminate sites based on what they say - be it political, sexual or religious in nature? 

Giving anyone power, in other words, carries with it the potential for abuse. Giving no one power, on the other hand, results in anarchy. I've said before that the solution is to enforce TLDs, while making sure there's one for everyone, regardless of what they're selling. We need a .pol domain that will take followers of everyone from Pol Pot to Vladimir Zhirinovsky, a .sex domain those on both sides of every question can find a home on, and a .rel domain that will accept all the names of God. We also need someone with the power to say, to Don Ellis and David Goldman , your speech rights will be protected, but X rather than Y gets the trademark and that's that. 

The trouble is, there is no world figure or organization with enough respect from enough sides of every question to which sensible people would willingly give this kind of power. Should we create an international court, we turn every domain name dispute into a legal question, and those who have the gold will make the rules. Still, it should be obvious that someone, or some group of someones, must be given the power to make final decisions, subject to some process providing checks on that power. And if you've agreed to all that, you've just agreed on something like a "world government" - and given it the power to control speech in the 21st century. 

What Clues emerge from all this? Not enough, unfortunately. The best one I can come up with is that if we change the domain name subject, from whether to where, we can at least make sure everyone finds a place in this Brave New World we're creating. But I'm also perfectly willing to hear from you... 



SSP (Shameless Self-Promotion) 

Oh boy, more work. I've begun a column in Boardwatch Magazine, looking for details on the technology behind some of the most successful online stores. I'm also looking forward to publication of Kate Maddox' "Web Commerce," from John Wiley & Sons . When Amazon gets it, of course we'll have a link. 

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And now back to our show... 


Yahoo (But Can They Execute?)  

Clueless investing gives marginal businesses new opportunities to buy a Clue. When the chance is taken, it's time to celebrate. That's the conclusion here based on Yahoo's $49 million purchase of Viaweb

Already, the engine's home page offers merchants their own, inexpensive "Yahoo store". But true exploitation of this purchase, it seems to me, depends heavily on the local Yahoos, which so far haven't been pulling their weight. Proper exploitation means hiring local sales staffs, and sound business advisors, who can help small stores use Viaweb's software to build successful cybershops, not just empty storefronts. Given Yahoo's past failures in updating its index in a timely fashion, it's not clear whether the company will give Viaweb the resources it needs to make this deal pay, but if it does watch out. 

Viaweb has been around three years, has a small client base peopled by recognized names like Frederick's of Hollywood, and lets merchants quickly create working stores that take credit cards. The cost -- $100/month if you just have 50 items, $300 per month to sell up to 1,000. To Yahoo's credit, they're not predicting a big earnings pop. They may have picked up the Clue that, while the technology can be bought for stock, the staff needed to make the deal will want cash. 

Protecting Privacy  

Score one for Europe. Starting in October U.S. sites will be enjoined by law from exchanging data on European users, without those users' explicit consent. And this Internet law will be adjudicated in European courts - holy change of venue! 

Fortunately, the U.S. may finally be moving toward this kind of strict privacy protection. U.S. Web sites completely failed the FTC's simple privacy test. The failure to even protect childrens' privacy  has finally moved Big Media commentators  into supporting new laws. 

This is another great libertarian dilemma - a Hobson's choice between invasions of your life by big business or invasions of your business by big brother. The Direct Marketing Association  is already leading the charge against "big government." Money will win this political war for now, but every recovery ends, and the guess here is that come the resulting political firestorm a lot of databases are going to be erased. The best Clue is to make sure, right now, that yours won't be among them, by telling people what you'll do with the data they give you and by giving them something in return for that data. 

Whoo Are You (Boop-boop, boop-boop)  

The march toward personal encryption keys took another step forward last week with the announcement that IBM has brought an important player into the fray - Equifax

Why is Equifax important? Because they have decades of experience dealing not just with big databases, but with government regulation over how that data is collected and distributed. In this case, Equifax is merely going to be a service bureau, verifying keys and maintaining lists for Vault, IBM's digital key offering. The system goes online next month, and is currently aimed at business-to-business customers. The initial offer lets Equifax compete - for the first time - in an area now dominated by Dun & Bradstreet , which sells all those business credit reports. (While these are merely identity checks, the direction should be clear.) 

IBM is also the chief purveyor of hardware to payment processors, both banks and third parties. IBM thus has the power to make sure this system gets supported in merchant processing systems, and gives it a leg-up against growing competition from Microsoft and First Data. In time this will be good news for everyone in the game, including Verisign  and GTE . Just remember that the dance has just begun. As we've said before, your key Clue is that digital signatures are 2001 - A Web Odyssey. Until then, no need to open the pod bay doors, Hal. 

Clued-in, Clueless 

Clued-in is David Pool and DataChannel  for offering their technology, royalty-free, under the name WebBroker, to the World Wide Web Consortium.  The idea is to link CORBA and Microsoft COM objects within the emerging XML standard. If it works, this money-losing Web start-up comes out a big winner. If it fails (perhaps losing to the more audacious Infospheres  project at CalTech)...he had a losing hand anyway. You have to know when to fold them, as well as when to hold them. 

Clueless this week is Ken Glaser of Online Press , for missing the significance of C|Net, ZDNet, Internet.Com and Andover.Net going after one another in ads. In a word, Ken, it's saturation. You don't go after the other guy until going after newbies stops paying. That's a sobering realization for anyone playing the Net news game. 



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