(formerly "A Clue...to Internet Commerce")
by Dana Blankenhorn
Volume II, No. XXXVIII
For the Week of September 21, 1998

This Week's Clue: Dealing With Scumbags 

SSP (Shameless Self-Promotion)  

Holes in the Market 

We Need To Grow Up 


The Politics of the Matter 

Clued-in, Clueless

This Week's Clue: Dealing With Scumbags 

Legendary Coca-Cola Co. chairman Robert Woodruff liked to say "There's no end to what a man can do if he doesn't care who gets the credit." We should all beware its corollary, "There's no end to what a man can keep from getting done if credit is all he cares about." 

We're seeing that in Washington and we see it often in Internet Commerce. While I advised last week it's a mistake to treat your opponents like scumbags, what do you do if they persist in acting like scumbags? 

Let's first hearken to the story of Mary Ihla  from Minneapolis, Minn., who told her tale to Eva Rosenberg of AudetteMedia's I-Sales HelpDesk last month. Mary created a wonderful Web resource for a northern Minnesota resort called Park Rapids, her old hometown. She was guided in this and (for a time) paid by a local bank. Once the local Chamber of Commerce got downwind of her success, however, they dissed her and forced her offline in favor a typical, lame C of C site of their own. 

What really seems to have gotten them upset, I decided long after reading her story, was that she launched a message board and some of the messages weren't, shall we say, as complimentary as they could have been. Marketing content is fine, but it takes a special business to handle critical content. The Clue Mary missed is it takes a journalistic business. She picked up on some other Clues - always have a contract for content, never work free for someone else, and always register the domain you're supposed to control. But she didn't see the nature of the business she was launching until it was too late, and that eventually cost her. 

I've been there. In fact, several times. I spent nine years building a business for someone else, and got fired when I tried to take a bow for my pains. I was put in nominal charge of a financially successful site , but found myself alone within two months because someone else actually controlled the purse strings. In both cases I went through the whole grieving process, but finally accepted that I'd brought it on myself. Trusting others to watch out for your interests is usually a losing game. 

So how do you deal with people who insist on acting like scumbags? The first Clue is this. Even if you're nominally employed, you're always an entrepreneur. You're the owner and operator of a business known as you, and you are the only person in the world who really has the best interests of that business at heart. The second Clue, of course, is to know what those interests are. What do you want to actually be doing in five years - is it Web design, sales, management, or (as in my case) journalism? Well, do that, and don't waste your valuable time on actions that are, as marketers like to say, "off message." 

Mary's come out of her experience soured on anything that can't be defined by contract (who can blame her?) but I've had plenty of non-contract arrangements that worked well. The key is to know going in what you want out of the deal, making sure that's understood at the top, then staying focused on it. In the Park Rapids case, Mary focused on what others would get - I've made the same mistake many times. But I've learned in the process that Selfishness isn't just a financial concept. You must be selfish concerning your own time, learning and personal growth. If you're not, you're asking for trouble. 

Let me finish with a lesson from my own street. When I moved to my present home, in 1983, I was encouraged to join the local block club. Our street has just 35 homes, but every month a group of us met at someone's house, ostensibly to talk about crime. We gave precious time away, but in the process we drew closer together. Our crime rate was, and remains, half that of neighboring streets. In the last two years the market value of my home has tripled. More important, I made friends who taught me valuable lessons, mentors who made a selfish over-educated boy into a worthwhile man. I went to the meeting to fight crime, but I got much, much more. If you're clear on what you want when you go in, and stick close to those who give you a return, you can reap incredible dividends. 

SSP (Shameless Self-Promotion) 

You can now order "Web Commerce: Building a Digital Business," , by Kate Maddox with yours truly (but with on the cover) through Amazon.Com. It's $27.95, part of the Wiley/Upside series. Let me know what you think of it. 

A-Clue.Com has also been picked up by Andover News  as its Monday e-commerce column. Thanks to you, A-Clue.Com now goes to over 900 Clued-in subscribers each week. Thanks to Multimedia Marketing Group  a UnityMail  customer, it's also an in-line HTML file (no more messy Web codes). Besides producing A-Clue.Com, I contribute regularly to such publications as Net Marketing , Boardwatch, Datamation  and Atlanta Computer Currents . Your magazine can join the list - send me an e-mail and let's start the ball rolling. 

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And now back to our show... 


Holes in the Market  

Lost in the hubbub over Web development  mergers is their impact on the clients. 

As Bert Ellis of iXL told me when I wrote about him for Net Marketing , companies are scaling up to do Big Bidness with the Fortunate 500. The problem is they're missing the Russell 2000, not to mention the Entrepreneur 10 million. Mindspring  actually felt moved to create its own mini-shop to handle this "small" business, and when we're talking small we're talking anything under $10,000. 

Even accounts worth up to $500,000 aren't safe. What happens when the firm you hired gets bought-out, and the guy or gal you trusted is moved to a bigger account? What happens when the whole team gets sent away? Of course, these new, bigger teams are going to spend a whole lot more time in meetings and writing reports than before, and a lot less time actually developing than before. But the allure of that business is real, and until they grow up (or get that work done) you can be left in the cold. 

This is happening just as the bar for all Web stores is being raised. You must have database integration today. You must have not just a secure server, but a host of other services  regular merchants don't need. You don't just need an e-mail newsletter, but e-mail fully integrated with a database of your customers' (or clients) needs and desires . This is expensive stuff. 

What Clues can we offer? If you're small and don't yet have a store, get some software like SoftQuad's Online Merchant, which offers the functionality of Yahoo's ViaWeb without the entanglements. If you're larger look to hire Web-savvy full-time, and when you find it, bring that person into your innermost decision-making. Tie their hands with golden handcuffs and retain your copyrights. Don't out-source to the point where you're totally dependent on outsiders. And flatten that org-chart, so the guys (and gals) doing your Web development have a direct pipeline to you. Finally, remember you don't have to hire 22 year olds with nose rings. Most of this job involves system integration, so team system integrators with young, smart marketers. 

We Need To Grow Up  

When the Web was first spun, it made sense to protect it from nasty old telephone companies, and the entanglements of their regulatory scheme. But it's time to admit those days are over. The Internet isn't going to go away no matter what the government or the Bells decide to do to it. So it's time to consider their problems seriously. 

Recent moves by BellSouth and US West  aimed at charging access fees to Internet telephony specialists should be seen in that light. If you don't want to make sure everyone can get a phone circuit, say so. If you've got a better way for the Internet to share the regulatory (and tax) burdens of national and international telephony, offer it. But claiming we're too small or new won't work anymore. 

The technology of Internet telephony offers big cost-savings over traditional switched circuits. Those savings are steadily being captured  by the folks who make telephone-industry infrastructure . Beyond that, the financial advantages held by Internet-only telephony players are based on tax effects. Is that fair? IBM's announcement of a suite of solutions for IP telephony services will let all long-distance companies into this market very, very quickly. The Bells fear that companies like LCI and MCI will simply switch their voice traffic to the Net and stop paying that 40% kickback. 

Still, if 40% of a voice telephone bill is a tax for universal service, payable to the local Bellhead, and if telephony is a by-product of Internet access, shouldn't the Internet have a big stake in how such charges are determined, and who gets the money? Of course it should. But we won't take our place in the debate until we get our heads out of the sand. To the extent these moves force that, BellSouth and US West are Clued-in. 


Expect a lot of crying over the launch of TriStrata Security  and its new encryption method based on Vernam encryption. The crying is over the fact that governments can break the locks, which aren't based on double (public and private) encryption keys. But if TriStrata's methods lead to everyone encrypting everything, routinely (as TriStrata predicts it will) most of us will have all the security we really want. Paul Wahl was lured to the CEO chair from SAP's U.S. operations, a high-end database accounting software firm that not only competes effectively with Microsoft but counts it as a customer. 

Vernam's system, invented in 1917, uses a single key, which law enforcement can get with a court order. But the key itself is secure. This makes it exportable but also secure enough for any honest man to approve. The order to open the key goes, not to a third-party certificate authority , but to the person who encrypted it. Bad guys will run from the paperwork. Good guys (or good guys turned bad) should fight the orders in court. 

The Politics of the Matter  

I was dragged (kicking and screaming) into the Clinton-Starr mess on September 10, when CBS Radio "deposed" me (OK, it was quick interview, but the word's fun in this context) concerning the release of Starr's report on the Web. Naturally, I called it Clueless. E-mail is the better broadcast medium, I said. Put something with broadcast interest on a Web site, and you're forcing a mob through a narrow doorway. Most won't get through. Of course it was quoted, but more important I was right. NetRatings told Jesse Berst  after the smoke cleared that all government servers eventually melted-down, and Keynote Systems said it found 89% of accesses to the U.S. House failed. Even MSNBC missed 53% of its calls the first day. I watched five networks (including CNBC and CNN) show newsmen reading fax papers for an hour 
(I would have preferred the tennis ), but in time we all got the message. 

My own guess, however, is most of you are as disgusted by the whole spectacle as I am. Everyone from James Carville to Bob Barr should be run out of town and made to earn an honest living. Our politics, previously reduced to the unnatural "left-right" divide of "Crossfire," have fallen further. We're seriously debating whether being the subject of a "Penthouse letter" merits banishment from Washington (when you don't tell your wife or lawyer about it). If you're seriously considering impeachment and conviction, do it quickly, I say - isn't government supposed to be about me and my (or you and your) problems? 

The fact is, as I wrote a week ago, that we're now paying for the political assumptions of our generation. Vietnam was, for American politics, a second Civil War, and while the "North" (hawks) lost, the "South" (doves) had to be occupied. "Waving the bloody shirt" worked until the corruption of the whole process brought a fat, philandering Governor willing to hit the other side as hard as he was hit into the Oval Office. (Grover Cleveland in the 19th Century, Bubba in our time.) Neither side deserves to win this war - the war itself is the problem. 

Have we gotten far enough afield from Internet Commerce yet? I submit the Internet plays a role in getting us past this mess. A true Internet-centric campaign avoids TV entirely. It builds a database of "correspondents" via e-mail, and they in turn become your party structure. The undecided can get all the data they want on your Web site. Such campaigns can reach nearly everyone, but cost a pittance compared to broadcast campaigns. The trouble is such campaigns are "not financially credible," say pundits, meaning the candidates aren't taken seriously and they're dead before they start. The only way to be taken seriously, however, is to sell-out, and then you're part of the problem before you get started. Yet we know that Web and e-mail servers can both sell and broadcast a proposition very, very efficiently. 

What's obviously needed before this gets going is real customer demand, in the form of voter revulsion against business-as-usual. That won't happen in this election cycle. (We're still on spin - have to wait for rinse.) But here are some races where you might track the beginnings of revolt against politics as blood-sport, and for politics as it should be, a messy set of compromises in which flawed human beings do the best they can in response to signals (weak or strong) from the people. In Vermont, 79-year old dairy farmer Fred Tuttle  beat a millionaire consultant for the "right" to face incumbent Patrick Leahy. Leahy claims to be Internet-friendly, but Tuttle totals will speak to profound anger concerning business as usual. In Michigan, Geoffrey Fieger , best known as Jack Kevorkian's mouthpiece, is the Democratic nominee for governor. Neither of these candidates stands a chance, and neither has yet fully tapped the Internet's potential (I'm also endorsing neither one of them), but we're measuring feelings that might become opportunity. So watch these races closely. 

Clued-in, Clueless 

Clued-in is Charles Bosworth of the St. Louis Post-Dispatch for his frightening story of how hate groups are trying to use the Internet to kill a government informant. 

Clueless (unfortunately) is Bounce Spam Mail , a new program by Albert Yale that gives your responses to spam a set of fake return addresses, encouraging spammers to take you off their lists. This reminds me of the Clinton Administration investigating Kenneth Starr. What's Clueless is the assumption the idiots you deal with are evil, and the jump into evil as a response. That's how we got into Vietnam, guys... 

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