From: "Kawika Daguio" <KDAGUIO.ABASP1.ABAOF40@aba.com>
Date: Sat, 7 Nov 1998 00:29:38 +0800
To: <rah@shipwright.com>
Subject: Re: RE: Digicash bankruptcy
Message-ID: <s642d445.034@aba.com>
MIME-Version: 1.0
Content-Type: text/plain



Much of Digicash's problems came about as a result of its inventors worldview and dreams.   These primary problems were caused by the same factors that created the impetus for their development.

The business constraints that David Chaum attempted to impose on everyone interested in his technology included social theory driven restrictions.   He really wanted to change not only how future payment systems worked but also wanted to change how current payment mechanisms and general social interaction and commerce worked in the future.  I share some of his concerns, but do not find his solution satisfactory.

I also remain unconvinced that point to point protection of sensitive information including credit cards numbers solves anything.   Infosec as practiced in the WebWorld leaves much to be desired.  Point to point encryption + weak and misleading naming (domain names) + near meaningless authentication + untrustworthy practices =  slightly worse to slightly better than nothing at all.

I am extremely patient (5-50 year time horizon) and remain hopeful that time, money, and proper attention by experienced risk and operations managers will resolve many of the weaknesses with current infrastructure and business models.

Kawika

>>> "Phillip Hallam-Baker" <hallam@ai.mit.edu> 11/05/98 09:07PM >>>
Phil is right in much of what he says but in a couple of cases he
is wrong.

Regarding the 'vortex of buzz technologies', VRML, network computers
and push are certainly not hot properties at the moment, neither is
interactive TV - but the Web was designed as the antithesis of 
Interactive TV. The root failure of Interactive TV was the assumption
that the world wanted to spend its time passively consuming the dross
pumped out through a 1000 channel 120" TV which would dominate the home.

I would also like to add Java onto the pile. Java today is simply
what C++ should have been. It does not revolutionize the programming
industry, it simply provides what some people think is an object
oriented programming environment and removes some of the worst 
legacy clutter of C.

Cryptographic payment systems are here - in the form of credit card
transactions over SSL. The main problem with SET and its competitors
is that SSL works a little too well.

That is not to say that there is no future for SET. SSL and credit
cards are unlikely to make the leap from the consumer market to the
business to business market. SET provides an ideal platform to 
integrate the use of the credit card infrastructure for business
payments.

The other area where I would disagree is over protocols. HTTP is
quite radically different to FTP in that it is a computer client
to computer server protocol. The metaphor of FTP is rumaging through
a filing cabinet. The HTTP and Web mechanism employs a locator.
Admittedly there was nothing to stop a text mode Web being created
in 1982 but nobody did so.

What is true is that the time taken for Internet technologies to move
to market is very slow. Much of the HTTP technology that just reached 
the market was proposed in '92 and '93. 

Finaly I have difficulty regarding Digicash as being all that socially
responsible. Chaum's problems had a lot to do with the business terms
he insisted on. What he had was a technology which allowed an improvement
to a payment system. He imagined he had a monopoly on the only feasible
solution. He was very baddly mistaken. The monopoly rents he demanded
were more than the market was willing to pay for a working and deployed
system - let alone for a patent license.

		Phill





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