[Chapter-delegates] Andrew's first question should be: Is ISOC multi-stakeholder going forward?

[Dave Burstein]

The second question should be: "How wil we bring ISOC together after this?"

The third question should be "How can ISOC repair the damage to our
reputation?"

These should be first because we need to set a path forward for ISOC,
whether or not the PIR deal goes through.

*The following is boring and you don't need to read it unless you are
looking deeply. *

I expect the only important other part of the webinar will be the new facts
provided. At this point, most of us need new facts to be convinced, not
soft or philosophical discussion.

In 30 minutes, I doubt anyone's mind will be changed about whether this
large part of the Internet should be ruled by a diverse, non-profit
community or by a handful of billionaire Americans who are looking to make
a lot of money?  So much has been said already on the soft questions that I
doubt Andrew be able to bring much new. I listen closely to what he says,
however.

Andrew outlined several questions he thought were central and I'm sure
he'll address them intelligently. I think of most of these as moral
questions, right or wrong for the Internet. These are important, but I have
no special expertise and defer to others.

----------------------------

What I'm addressing are the practical issues, which may or may not imply
this is a good deal. (I'm still referring judgment, hoping for some facts
that clear up my doubts.

Even if you agree with much of his thinking on philosophical questions,
there are a slew of practical issues. Especially because it looks like the
deal would be blocked or delayed by the government after the extraordinary
outcry.

(It's being questioned by many including the PIR founder, the previous
Chairman of ISOC, and Tim Berners-Lee. It must be approved, at minimum, by
the Pennslyvania government under non-profit regulations and ICANN, some of
whose board members have raised questions off the record. IANAL, but it
doesn't make sense for PA to approve something this contentious without a
careful, public process.)

I suggest we agree on one fact to save time:

Gonzalo, Vint, Andrew and supporters are not corrupt and greedy, as they
have been described in some of the press. The deal, if it goes through,
will bring a great deal of money to support ISOC for years in the future. I
know these people.

They have human weaknesses and I often disagree with them, but I'm entirely
certain their main motivation is the prospect of a lot of money to continue
what ISOC has been doing.
--------------

Other apparent truths (I'm not objective but am trying to come close to the
truth despite that.)
"
!- We do not know the terms of the deal, without which detail I can't
evaluate whether it is good for ISOC in the future. Andrew and Gonzalo are
technologists. Very few on the board have a serious financial background.
That's important. We need independent advisors whose income won't be
changed by the deal.

One key question here is whether we are screwed if the deal is delayed or
canceled. IANAL, but a sale of a non-profit like this raises tough legal
questions. (I've read the law.) Our law firms can charge $1,000/hour
because they can make a convincing argument for almost anything. Paid by
the other side, the same lawyers could argue persuasively the opposite.

In addition, it looks like ISOC makes *much more money* if we keep .org
follow the business plan suggested by Ethos. Back of the envelope, PIR
would generate over US$80 million four years from now and well over $100
million a few years later. (Most of the 10% increase and other additional
revenue will add little to cost, hence mostly will be surplus.) That's why
I asked for the projections we are using to evaluate the deal. It would be
very surprising if ICANN terminated our franchise in the next ten years, so
it probably is a safer investment than what we plan for an endowment
returning 5%.

We got some answers about a proposed endowment, but most remains
secret.There's is no good reason for the secrecy, beyond that the money men
want it that way. If they want the deal as much as reported, they will
agree. Any good reporter presented with unnecessary secrecy suspects
something is wrong in what's hidden, one reason I asked so many questions.

Our advisors, Goldman Sachs, are very capable. But GS has a strong history
of recommending whatever makes more money for Goldman Sachs. They have paid
$billions in settlements and been involved in tens of billions in financial
shenanigans. That's why one of the questions is what are we paying Goldman
if the deal does or does not go through.

The answer "Goldman Sachs, whom we're paying to get the deal done, says
it's a good deal" is obviously inadequate. Anyone who has watched Wall
Street knows you can get a firm to testify to the reasonableness of just
about any deal. (Ask if you want examples. including Jack Grubman at
Goldman.)


Here is what I wrote before with questions. I hope we get answers in the 30
minutes, rather than the lectures the notice implies.

Is it a good deal for the Internet Society?
Some smart investors, including Fidelity, are willing to risk a billion
dollars. That tells us to look closely at our valuation.
To evaluate the deal, we need to know things like whether Perot, Romney,
and Johnson can back out of the deal without at least covering our
expenses. We're using lawyers from firms where partners can bill at
$1,000/hour. Those bills will be high.

Will they indemnify ISOC for any taxes?
What are the current financials of PIR and ISOC?
In 2017, PIR provided $74 million to ISOC; in 2018 $48 million. That's a
huge gap we need to evaluate. We need the data for 2019 and the projections
assuming a 10% annual increase to figure the Net Present Value we should
ask for.
PIR and ISOC spend the better part of a million dollars on accounting and
have monthly and quarterly figures. What are they implying?

Will it be approved by the US governments?
On the face of things, the deal has enormous problems and would normally be
blocked by Pennsylvania. IANAL A US not for profit can't be owned; ISOC
does not own PIR. Both boards have a fiduciary duty they seem to be
ignoring.
Our very expensive lawyers obviously have a legal theory and precedents
that will get around the obstacles. Could you please explain them in depth.
If PA proceedings are delayed for a public hearing and comment, can the
money men back out after we've spent what would be millions?

Will the deal be approved by ICANN?
Professor Milton Mueller, an expert on Internet Governance, has
written that ICANN
can and should block the deal as proposed.
<https://www.internetgovernance.org/2019/11/25/what-to-do-about-org/>Has
ICANN agreed to approve the deal?
If not, and ICANN delays, can the money men pull out?
(I don't know if Milton is right, but he's credible enough we should have
full details, including how that would affect the deal.)
Will the money men live up to the public service and financial commitments
that ISOC talks about?

Will Romney, Perot, or Johnson be represented?
Brooks has used weasel words and not made any firm commitment I've seen.
"in the spirit of" is legally meaningless. I'm guessing that he hasn't
received authorization from the money. Until we have something firm from
the majority in control, reporters and anyone else evaluating the deal
should assume Brooks' comments are not binding.
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