From: wcs@anchor.ho.att.com
Date: Wed, 23 Jun 93 10:40:03 PDT
To: cypherpunks@toad.com
Subject: Re:  Corporate Ethics and the Profit Margin
Message-ID: <9306231736.AA26526@anchor.ho.att.com>
MIME-Version: 1.0
Content-Type: text


gg@well.sf.ca.us writes:
> Re Robert.  Good one there, catching me saying "positive reinforcement for
> PKP and negative reinforcement for AT&T." The thing is, I agree corporations
> don't have feelings, but Jim Bidzos *does* have feelings and he is
> singularly responsible as an individual, to a range of constituencies. [...]

>  That's not the case with AT&T which is a HUGE bureaucracy.  If someone
> would find the single individual in AT&T who got them involved with the
> Clipper thing, we might have an interesting round of questions to ask.  The
> thing is though, once you're dealing with a specific person, the
> relationship of adversariality has to be modified to take into account the
> respect for the individual human being.  

A nice distinction, and possibly useful tactically.
(Disclaimer: This represents about 10**-7 of AT&T's official position,
i.e. I'm a stockholder like most employees, and nobody listens to me,
at least not when I'm right :-)

It's more than a single individual; it'd mainly be the managers
of the group that makes their current line of secure phones for the government.
Some of the phone models already have special government encryption chips;
this is yet another design variant, and not a really major decision to make
as long as there's enough tentatively-promised volume to expect a decent
return on the investment.  Motorola's in about the same situation.
Back when the STU-III first came out, the government was talking about
total sales of maybe half a million units to governments and contractors;
I don't think sales were anywhere near that large...

The interesting questions are whether there are any other strings attached, 
especially about whether that group will also attempt to market non-wiretapped
phones to the public (I don't have any knowledge on that one), 
and also what the impact is on the parts of our "huge bureaucracy"
which weren't in on the secret until we read about it in the New York Times 
or on the net but will be affected by it (much discussion is still going on, 
especially by people on standards committees which are getting pressured by 
the NIST and co-conspirators to specify SkipJack/escrow in industry standards.)
The rest of the U.S. telecomm industry is in about the same situation.

If you want to pressure AT&T or other large corporations, one popular approach
is to buy stock and put a stockholder question on the ballot for the annual
meeting; unfortunately the government's trying to railroad everybody into
using Clipper fast enough that that's probably not practical here,
but there are SEC rules on how to do it, and it does reach a lot of people
and make a lot of noise if you can pull it off before it becomes moot,
even if you lose (directors of large corporations almost always oppose
stockholder resolutions - if do they support something, they can just do it
and avoid the need for the voting process.)  Having never done this myself,
and don't know the costs or level of effort involved, but enough wackos
put enough things on stockholder ballots that sane people like us can
probably do it as well.  It's important to make any ballot questions SHORT,
clear to the uninitiated, positive, non-adversarial, and actionable,
which ain't easy for complex topics like crypto.

		Bill