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On March 10 an event the outcome of which will be critical for the future of the Internet in the United States occurred. Tracy Futhey, Chair National LambdaRail and Jeffrey Lehman, Chair Internet2 issued a joint letter that began:

Dear Colleagues,

Over the past four weeks, we have conducted private conversations aimed at finding whether circumstances have changed sufficiently over the past year that our organizations might consummate a merger.

This week, we reached agreement on a process and a plan to bring the two organizations together, which we both support, fully and wholeheartedly. To be sure, it involves compromises on each side. But in the end, we believe that it provides the framework for an organization which will provide a significantly improved environment for stakeholders in Internet2 and NLR.

We are pleased to announce that the Boards of both Internet2 and National LambdaRail have yesterday endorsed and agreed to a Memorandum of Agreement that outlines how we will pursue this plan.” [snip]

Giga Om and DSL Reports published congratulatory notices over the weekend. While I respect these two sources immensely in this case they essentially passed on a press release without knowledge of the background.

In fact merger talks between the two organizations began in the late summer of 2005 and lasted until the early summer of 2006. In the NLR Annual Report for 2006 we read:

“One 2006 setback should be noted: From August 2005 to June 2006, NLR expended significant energy, time, and financial resources in merger discussions with Internet2 (an NLR founding equity member), until the Internet2 Board chair called off negotiations. In October 2006 NLR and Internet2 signed a Cessation Agreement severing Internet2’s membership responsibilities in NLR.”

I have a lot of contacts in the global education and research networking community. Consequently I was informed of the merger proposal in July 2005. Conversations with a number of folks gave me the picture that Doug van Houweling wanted to swallow up NLR and meld its vital approach of managing its own fiber into the I2 approach of letting someone else do it. Doug is a strong willed character with whom I had my first contact back at OTA in December 1990. The Internet2 that he went on to play a significant role in founding was - it seemed to me much more about giving universities access to high bandwidth applications at affordable prices than fundamental network research. The research leaders were Surfnet in Holland and Canarie in Canada. I have written extensively about both and have had no contact with Doug for at least a decade.

I have watched NLR with considerable interest over the last few years. Here at long last in the USA some researchers were taking the really cost effective approach of owning their own fiber. Hooray! And about time. then in November 2006 I discovered the Commons project. Last month I was able to interview the principals, including Tom West who has agreed to provide the platform for what is in my opinion the single most important effort underway to ensure the survival of the Internet in the USA as something other than a platform for the delivery of TV. I asked Tom to explain to me how he came to understand that rolling your own fiber was the way to the future. His response was quite fascinating.

Let me be very blunt. I am very strongly biased on behalf of NLR. The plunge in cost of opto - electronics needed to light the fiber on a per-gigabit basis since 2000 is stunning, and the capacity running in production with Infinera gear capable of running upwards of 100 wavelengths on a single starnd, and in the labs at upwards of 1000 Gbps, is essentially infinite. The cost of the fiber itself has appeared to have finally bottomed. For what it delivers, it is still cheap. To my knowledge NLR’s national footprint of Level 3 fiber owned by NLR with a 20 year IRU is the only is one of only a few fiber of such arrangements that could more or less be considered more or less “public” hands. Given the duopolization of broadband in the US, it is critical that both Level 3’s and NLR’s fiber survive.

But the question still lingers: “how could what was “off” suddenly be on again?” I think I have a sound hypothesis. Both Doug and Tom are strong willed men. Both insisted on controlling any merged entity. The consensus of a range of people with whom I talked and none of whom would be quoted on record was that Doug van Houweling of Internet2 was determined to run the merged organization. Indeed on one Internet2 web page that I found he was listed as CEO of the to be merged organization and Tom West as Deputy CEO. While I have not been as thorough in talking to the Internet2 side, I am convinced that the consensus there would be that Tom West was determined to run the combined organization - no matter what.

A Coup d’Etat?

What happened was - I surmise - a coup d’etat. The announcement was executed by the Board chairs of the two organizations. It contained neither the name of Tom West nor Doug van Houweling.

Fridays announcement said that a new CEO for the combined organization would be recruited:

• Internet2 membership categories will be carried forward into Internet2-NLR. In addition, a new membership category, called “Investors,” will be created for the current NLR members.

• During the next two years, while a transition plan is developed for the Board election element of the GNC report, Internet2-NLR will be governed by a Board that consists of a 21-member group of individuals. This group includes members from each current board, together with other members of our community. Advisory councils of the new organization will include the broad-based constituencies recommended by the GNC, with the addition of Investor representation.

• In June 2009, the governance structure of Internet2-NLR will follow the GNC’s approach to multi-stakeholder participation.

• A new CEO will be recruited to lead Internet2-NLR.

Economics a Forcing Factor?

After the merger was called off this summer, Internet2 achieved an early termination off its contract with Qwest and signed up with Level 3 for a managed services agreement for it’s 200 plus members. In the process they acquired financial obligations that would be two tp three time the cost of running their projects over fiber that they owned.

I googled rather extensively in preparing my interview with Tom West and one thing becomes very clear in the comments that are findable. Folk involved felt that an important opportunity had been missed and didn’t quite know what could be done about it.

Tom West over the last four years has constructed one helluva cost effective organization. All any Internet2 member would have to do was read the NLR web site with care to see benefits that could save his university a bundle.

As a senior Internet figure reminded me: The US Academic and Research community is not so wealthy that it can afford to pay for two NREN’s indefinitely. Apparently the folks at the member universities who have to write the checks are taking a good close look at the separate expenses and doing comparison to what they would be if Internet2 transitioned from a “managed service” to NLR’s roll-your-own style. The savings would be very large. And the combined organization would carry weight with suppliers and in the policy world that the competing ones don’t.

Had not Tom West had the vision and leadership to push for what NLR has shown to be possible I believe that Internet2 would have remained stuck in its mid 1990s rut. My sources are expressing optimism say that they think the economic and technology arguments are so strongly in favor of the NLR approach that the new organization will look in its operation like NLR.

I hope they are right.

A free and independent IP fiber based infrastructure over which competing providers may sell services is the most critical economic infrastructure of this new century. This is not yet widely understood. In my opinion such understanding is one of the most critical public policy goals for this country.

The Commons project - see the final report - in my opinion is the most important internet initiative of the last decade (from the point of view of the American broad band debacle). Whatever the Boards of NLR and Internet2 do, if the do no harm to the Commons and preserve the NLR financial and operational structure, - then we will all be winners.

These are critically important events and bear close watching.

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