Minutes of Board Meeting No. 13

12 – 13 Dec 1997, Washington, D.C., United States

Author(s): G. Huston (Secretary)
Date: 1997.12.15
Committee: BoT
Document: 971212
Revision: 2
Supersedes:
Status: Approved
Maintainer: G. Huston
Access: Unrestricted

A regular meeting of the Board of Trustees of Internet Society, a non profit corporation organized under the laws of the District of Columbia, U.S.A. (“ISOC”), was held pursuant to notice at the Omni Shoreham Hotel, Washington, D.C., U.S.A., on Friday 12 December 1997 and Saturday 13 December 1997.

Frode Greisen, Chairman of the ISOC Board of Trustees, assumed the duties of Chairman of the Meeting and called the Meeting to order at 9:10am on 12 December 1997. Geoff Huston, Secretary of the ISOC Board of Trustees, assumed the duties of Secretary of the Meeting and recorded the Minutes.

1. Attendance

The following members of the Board of Trustees were present at the Meeting:

Scott Bradner, Vinton Cerf, Susan Estrada (by telephone), Dave Farber, John Gilmore, Frode Greisen, Don Heath, Christian Huitema, Haruhisa Ishida, Christine Maxwell, Jun Murai, Tim O’Reilly, Jose Luis Pardos, Jon Postel, George Sadowsky and Ben Segal.

A quorum was present on both days.

Also attending the meeting were:

Geoff Huston (Secretary),

C. Joe Pasquariello (ISOC Advisory Council), Nicholas Trio (ISOC Advisory Council), Michael Conn (ISOC Advisory Council), Ole Jacobsen (ISOC Advisory Council), and Stefano Trumpy (ISOC Advisory Council),

Mary Burger (ISOC Secretariat), Marty Burack (ISOC Secretariat), Torryn Brazell (ISOC Secretariat), Michael Sadowski (ISOC Secretariat), Jeff Caplan (ISOC Secretariat), Michele LeComte (ISOC Secretariat).

The meeting, apart from Board consideration of items that are noted in the minutes as matters considered in closed session, was open to observers.

2. Agenda

The agenda for the meeting was circulated prior to the meeting.

3. Approval of Minutes

The minutes of the 1997 Annual General Meeting of the Board of Trustees held on June 23 – 24 1997, at Kuala Lumpur, Malaysia, had been distributed for review prior to this Meeting.

The minutes were unanimously approved.

The minutes of a regular meeting of the Board of Trustees held on June 24 1997, at Kuala Lumpur, Malaysia, had been distributed for review prior to this Meeting.

The minutes were unanimously approved.

4. Ratification of Electronic Votes

The Board ratified the appointment of the ISOC Audit Committee.

Resolution 97-26 ISOC Audit Committee
RESOLVED, to appoint Christian Huitema (chair), Michael Conn and Tim O’Reilly to the ISOC Audit Committee.

The Board ratified the establishment of an INET’98 Conference Bank Account.

Resolution 97-27 INET’98 Bank Account
RESOLVED, that the Board of Trustees authorizes the President of ISOC to establish a Swiss Franc account and a U.S. dollar account, as needed, with a Swiss bank to support the financial operations of the INET’98 Conference and related events.

The Board ratified the appointment of General Counsel to ISOC.

Resolution 97-28 ISOC General Counsel
RESOLVED, to accept Mr Stuart D. Levi, Esq., of the law form Skadden, Arps, Slate, Meagher & Flom LLP, to be the Internet Society General Counsel.

The Board ratified the ISOC appointments to the generic Top Level Domain (gTLD) Policy Oversight Committee.

Resolution 97-29 gTLD Policy Oversight Committee appointments
RESOLVED, to nominate Mr Christopher Wilkinson and Mr David Maher as ISOC nominations to the gTLD Policy Oversight Committee.

Resolution 97-30 gTLD Policy Oversight Committee appointment term
RESOLVED, to nominate that Mr Christopher Wilkinson be appointed for a three year term on the gTLD Policy Oversight Committee.

5. President’s Report

The President, Don Heath, spoke to his report.

The President noted that the overriding concern remained organizational membership of ISOC and the need to rebuild a solid financial position for the Society. 54 new organizational members have been added and a further USD 400,000 in annual revenue has been raised within this effort. Complementing this is a broader individual membership base, where the majority of individual members are now from outside the United States.

The ISOC-sponsored effort with the generic Top Level Domains (gTLDs) has been gathering momentum, with 181 signatures on the enabling Memorandum of Understanding and 87 name registrars included in the initial set of registrants for these names. It was noted that this effort is anticipated to result in the new domain names being available for use early in 1998. This effort has involved ISOC in many areas of Internet activity and placed the Society in a strong position within the activity to create a self-governing framework for the Internet as a whole.

The INET’97 conference did result in a financial loss to ISOC, and accordingly drew on cash reserves to the point that intensive effort was required in the second half of the year to ensure sustainable cash flow for ISOC. The President is looking to future INET conferences for a positive financial outcome which will strengthen ISOC funds. The President indicated that a desirable level of funds is that of six to nine times monthly expenditure requirements.

The Society’s publication, OnTheInternet, is recognised as a leading publication concerning issues of Internet evolution worldwide, and the ISOC Forum electronic newsletter is a useful mechanism for continuing contact with the ISOC membership.

The emergence of active ISOC Chapters is a current feature, with the most recent being the Netherlands chapter, which has gathered sufficient financial support to enable the maintenance of a full time secretariat for the chapter.

6. Advisory Council Report

Stefano Trumpy reported to the Board on ISOC Advisory Council Activities and outcomes from the Advisory Council Meeting held on December 11, 1997.

As the voice of the organizational members of ISOC the ISOC Advisory Council is expending effort to engage more directly in the efforts of ISOC. The current areas of activity focus towards the evolution of the Internet Assigned Numbers Authority (IANA) and the gTLD activity, where effort will be undertaken to provide Advisory Council members with timely updates of developments in these areas.

The next Advisory Council meeting will be held immediately prior to the ISOC Board of Trustees meeting in July 1998.

7. Organizational Membership Report

Currently there are 152 Organizational Members of ISOC, the outcome of an initial membership level of 128 members at the start of 1997, with 30 membership cancellations and 54 new organizational members added to ISOC. It was noted that this is still short of the total ISOC objective of a steady state of no less than 242 organizational members and as associated funding base of a minimum of USD 1.4M p.a., and Board members were reminded that further effort is required by Board members in order for the Society to meet this objective of positioning ISOC in a sound financial position.

Regarding the strategic objectives set by the Board in June 1997 to achieve this objective, the initial funding commitment of USD 200,000 in July 1997 was achieved, and is appears that end of year objective of USD 500,000 will be achieved at the end of December 1997, but further Board involvement is critical in order to achieve the target of USD 1M in new membership by June 1998.

8. Review of 1997 Activities

8.1 1997 Financial Report

The Board considered the financial report for 1997 as of the 30th November, noting a year to date operating loss of USD 234,355, with a total fund balance of USD 153,606. The projected outcome for 1997 is an operating loss of USD 265,000.

The Board considered the cost center reports, and noted the final outcome from INET’97 is anticipated to be a deficit of some USD 215,000 rather than a positive outcome of USD 250,000 as projected in the 1997 budget. This has resulted from significantly lower levels of paid registrations and sponsorship levels for INET’97 than forecast, while fixed costs were not able to be reduced to comparable levels. This overall outcome is some USD 465,000 lower than the Society’s 1997 budget, which has been a substantial factor in the complete 1997 financial outcome for the Society.

The Board considered the projected cash flow statements for December 1997 through to March 1998, noting a critical period in the start of 1998 before cash reserves start to build again from membership renewals.

8.2 NDSS’97

The Board noted a net operating deficit from NDSS’97 of USD 6,119, noting lower levels of registrations than anticipated in the adopted conference budget.

8.3 INET’97

The Board noted a financially poor outcome from INET’97, with registrations and sponsorship levels down by USD 1.1M from the conference budget, while expenditure levels were able to be trimmed by USD 873,000 in response to this situation. The final outcome is anticipated to be a deficit of USD 215,000, anticipating a final receivable of USD 85,000 from MIMOS.

The Board considered the overall financial position of ISOC and reiterated the desired role of the INET conference as the mechanism for building adequate levels of reserve funds.

The Board adopted Resolution 97-31.

Resolution 97-31 INET Conferences
RESOLVED, to operate the INET conferences on a business basis that ensures INET conferences become a source of income to ISOC with low levels of financial risk to the Society.

9. ISOC Conferences

9.1 NDSS’98

Organization for this conference is underway, with conference material now in circulation. It was noted with some concern from the Board in the light of Resolution 97-09, that the conference organizing committee had not provided a conference budget to ISOC, and that the current working budget was one drafted by ISOC staff without direct Conference Committee input.

The Board reiterated its guideline that review of a conference budget was a consistent precondition to ISOC endorsement of a conference.

9.2 INET’98

The Board received a status report on the preparations for INET’98. The Board noted a very positive response to the call for papers, and a very high quality of presented papers was anticipated.

The Board reviewed the proposed conference budget for INET’98. The Board noted an anticipation of a relatively high number of paid registrations as compared to previous INET conferences, and relatively high cost of the conference facilities. These factors in turn create a requirement for a high level of conference sponsorship in order to ensure a positive financial outcome for the conference.

The Board considered the level of financial risk that the budget entailed, and proposed that the conference committee revise their budget using more conservative estimates of registrations and sponsorships, based on previous INET conferences.

The Board requested the preparation of a conservative budget which was backed by known INET conference participation levels from previous years and known sponsorship levels from previous years, as the basis for the INET’98 conference budget. The Board directed the Conference Committee to ensure that this revised budget be presented to the Board no later than January 6, 1998 for consideration by the Board for adoption within the 1998 ISOC Budget.

The Board adopted Resolution 97-32.

Resolution 97-32 INET’98 Conference Budget
RESOLVED, that the INET’98 Conference Committee prepare a conference budget for INET’98 which uses levels of registration and sponsorship levels as encountered in previous INET conferences, for consideration by the Board no later than January 6 1998.

9.3 Future INET Conferences

The Board reviewed a report on preparations for INET’99, noting a currently proposed regional location of the US West Coast. The Board requested the preparation of a preliminary conference budget with initial estimates of registration, sponsorship and costs for further consideration.

The Board discussed the options in conference location, noting that North American conferences provided significant reductions in the level of financial risk for such conferences due to an expectation of high levels of attendance and a high level of corporate support which could be drawn upon.

The Board discussed general options for INET’2000, noting that the current financial strategy for ISOC was to use the financial result of the INET conferences as the general mechanism for building fund reserves, while using membership revenue to fund the day to day operations of the Society. The Board wished the VP for Conferences to advise the Board of the implications of setting specific financial objectives for each of INET’99 and INET’2000, so that decisions could be made on potential hosting arrangements and venues with sufficient lead time.

Resolution 97-33 INET Conferences
RESOLVED, that the Vice President for Conferences advise the Board of the impact of setting surplus targets of USD 1M for each of INET’99 and INET’2000, and that this advice be tendered to the Board by March 1998

10. ISOC Chapters

The Vice-President for Chapters, Vint Cerf, presented a status report to the Board. As of November 15 1997, 22 Chapters have been constituted, and a further 7 are in formation, and 26 exploring chapter formation.

This activity is supported by Vint Cerf, with administrative processing being handled by Terry Weigler of MCI, with additional support by Alan McCluskey from the Geneva Chapter.

The Board unanimously adopted Resolution 97-34, creating the position of ISOC Chapters Liaison.

Resolution 97-34 ISOC Chapters Liaison
RESOLVED, that the position of ISOC Chapters Liaison be established, and Alan McCluskey be initially appointed to this position.

The Board reviewed the current guidelines concerning Chapter formation, noting that there was current provision allowing chapters to exclude ISOC members from membership of a specific chapter with “just cause”, which was felt to admit the possibility of discrimination of membership on the part of a chapter.

The Board adopted Resolution 97-35 to amend the ISOC Chapter guidelines.

Resolution 97-35 ISOC Chapter Guidelines
RESOLVED, that the ISOC Chapter guidelines be amended to remove the phrase “except for just clause” from the membership provisions for ISOC Chapters.

11. Reports

11.1 ISOC staff presence in Geneva

The Board noted an action arising from the 1997 Annual General Meeting where a subcommittee was chartered to investigate the establishment of an ongoing ISOC staff presence in Geneva, and noted the report prepared by Ben Segal addressing this action.

The committee proposes that the office be created and cover the zones of Europe, Middle East and Africa, with the purpose of recruiting new ISOC members, assist in the creation of new ISOC Chapters, revenue raising for ISOC and raising the Society’s profile in these zones.

The Board noted a firm pledge for USD 150,000 to cover the costs for the initial year and reviewed a three year business plan provided with the subcommittee report.

The Board accepted the subcommittee report, and agreed to proceed with the establishment of the ISOC Geneva Office.

Resolution 97-36 ISOC Geneva Office
RESOLVED, that the Board accepts the funding offer of the Geneva Borse to support a continuing ISOC presence in Geneva, commencing immediately following INET’98, and for this to be reviewed six months following the establishment of this office.

11.2 IETF Report

The Vice President for Standards, Scott Bradner, reported to the Board, noting that a stable relationship between the IETF and ISOC now in place.

IETF participation rates continue to grow, and the December 1997 meeting, held in Washington DC, drew some 2,000 IETF attendees. Despite some challenges faced with this increasing size the IETF meetings continue to be effective in terms of furthering core IETF activity.

Future confirmed meetings will be held in Los Angeles, 30 March – 3 April 1998 and Chicago, 23 – 28 August 1998.

The report noted that Marty Burack, Scott Bradner and Fred Baker had met with CNRI over the issue of structuring the activities of the IETF on a self-funded basis, and the agreed approach to use IETF registration fees to cover the cost of the IETF meetings and the cost of operation of the IETF Secretariat appeared to be working well. The was noted that the National Science Foundation grant to CNRI to provide IETF Secretariat services had expired earlier in 1997 and CNRI’s revenue stream to support the operation of these services is now exclusively based on IETF meeting registration fees.

The Board discussed the option of completion of an ISOC contract to CNRI for the provision of IETF Secretariat services, noting that these was no pressing requirement to complete a contract between the two parties at this point in time, but rather a requirement to address the structural issues relating to the IETF Secretariat function.

The Board encouraged Don Heath and Scott Bradner to pursue the completion of a contract with CNRI for the provision of IETF Secretariat functions to the IETF on a continuing annual basis.

11.3 IAB Report

The Vice-President for Standards, Scott Bradner presented a report prepared by the IAB chair, Brian Carpenter. The report noted that the IAB had recently:

• published a draft of the IAB Security Workshop Report as an internet draft (draft-iab-secwks-report-00.txt);
• successfully encouraged the ISO to publish a copy of ISO 10646 as an online document;
• approved the formation of a Routing Research group within the IRTF;
• proposed lightweight information interchange on new activities with other bodies; and
• commenced the NAT / VPN / IPV6 coexistence and transition discussion within the IETF.

11.4 IANA report

The Board noted the report circulated by IANA concerning the potential evolution of this body.

Jon Postel reported to the Board on these proposals, noting the existing functions of IANA within the areas of IP address management, top level domain name allocation, protocol parameter assignment, editing RFC documents and managing the domain root zone. A model of incorporation of IANA was described which included aspects of hierarchical organization within these IANA functions and drawing on a general model of base level participation as an instance of industry-based self-regulation, and input from the Board was solicited. The relative level of current financial support required to maintain each of these functions was noted.

The Board expressed its appreciation to Jon Postel for briefing the Board, and adopted Resolutions 97-37 and 97-38 to continue the dialogue with IANA.

Resolution 97-37 IANA Evolution
RESOLVED, that the ISOC Executive Committee take an active role in the evolution of the IANA proposals and inform the Board on progress of this activity on a regular basis.

Resolution 97-38 IANA Briefing
RESOLVED, that various IANA evolutionary models be presented to the ISOC membership for discussion by the membership and for note by the Board and IANA.

It was recorded as the sense of the Board that the Board would like ISOC to be involved in the evolution of IANA, and to also express that ISOC is specifically not interested in the control of top level domains.

11.5 ISOC Nomination Committee Report

George Sadowsky, Chair of the 1998 ISOC Nominations Committee reported to the Board on the composition of the 1998 Nominations Committee:

George Sadowsky, Dave Farber, Shigeki Goto, Larry Landweber, Christine Maxwell, Javier Sola and Florenco Uteras.

The board considered a proposed refinement to the 1998 Trustee Nomination and Election Timetable (as adopted by Resolution 97-23), noting that the proposed refinement remained within the time limits specified by the adopted ISOC Nominations and Elections process.

Resolution 97-39 1998 ISOC Trustee Nomination and Election Timetable
RESOLVED, that the Board of Trustees adopt a timetable for the 1998 Trustee nominations and election process, in place of Resolution 97-23, in accordance with the procedures of Resolution 94-19, commencing with the opening of the Nominations period on December 15 1997. The timetable to be adopted is as follows:

	December 15, 1997	Nominations Period Opens
	January 15, 1998	Nominations Period Closes
	January 23, 1998	Nominations Committee Announcement
	February 23, 1998	Petition Period Closes
	February 24, 1998	Candidate Announcement
	March 24, 1998	Ballots Posted
	April 1, 1998	Election Period Opens
	May 30, 1998	Election Date
	June 1, 1998	Challenge Period Opens
	June 10, 1997	Elections Committee Certifies Result
	June 20, 1998	Challenge Period Closes
	July 10, 1998	ISOC Response to Challenge Period Closes
	July 20, 1998	ISOC Board of Trustees Annual General Meeting

The Board reviewed the Call for Nominations and reviewed mechanisms to encourage a diverse geographical spread of candidates, and to encourage women to participate in this process.

It was recorded as the sense of the Board to improve methods of communication between candidates and the membership as a structured process within the election.

11.6 gTLD POC Report

The char of the gTLD POC, David Maher, reported to the Board on the current status of the gTLD framework. It was noted that the Policy Oversight Committee (POC) has been formally constituted, and the Council of Registrars (CORE) has been incorporated under Swiss law.

Effort within the POC is continuing on the administrative challenge panel procedures, and a third round of consultation on a draft proposal for these procedures is being undertaken by the POC. In addition the POC is evaluating proposals to expand the POC membership, with specific proposals relating to reducing POC membership by the ITU and WIPO to one non-voting member nominated by each body, and augmenting the POC membership by 9 individuals elected by the PAB, with specific areas of representation from industry sectors and geographic areas. Proposals to incorporate POC under US law are also being considered by the POC.

CORE is proceeding to develop the tools to support share registry operation of the gTLD names, with a current date of February 9 1998 for handover of these tools to CORE.

It was noted that there is no implicit claim of monopoly of operation of all the generic Top Level Domains within the single POC, PAB and CORE model, while the overall authority of IANA as the root authority was strongly emphasized.

The Board was informed of US government efforts to formulate specific directions with respect to current contracts and cooperative agreements with US Government agencies, and noted that extensive consultation with interested parties had been undertaken as a component of these efforts.

The Board expressed its gratitude to David Maher for his report, and noted that no action on the part of ISOC was requested or necessary at this point in time.

The Board adopted Resolution 97-40.

Resolution 97-40 General Counsel Waiver
RESOLVED, that the Internet Society waive any potential conflict of interest with regard to the Society’s General Counsel, Skadden, Arps Slate, Meagher & Flom LLP, and Mr Stuart D. Levi Esq., also providing legal services to the Policy Oversight Committee.

12. ISOC 1998 Budget

The Board considered a proposed budget which forecast total expenditure of USD 6,213,957 and total revenue of USD 6,361,788.

The Board noted that the budget had raised serious concerns within the ISOC Executive Committee. The sense of the Board was to phrase the objective within the budget to accumulate funds reserves of six to nine months of normal operating expenses as a commitment to ISOC Secretariat staff and ISOC membership to ensure stability of the Society.

The Board noted that with the exception of the INET’98 cost items, which project revenue of USD 4,034,850 and expenditure of USD 3,700,307, the remainder of the proposed budget items project revenue of USD 2,326,938 and expenditure of USD 2,513,650. The Board noted the budgeted item of USD 250,000 to support the activities of the IETF through the chair of the IESG.

The Board noted that the budget requires significant fund raising efforts to meet the strategic objectives of the Society, and that this should occur early in 1998. The Board was provided with a list of organizations and associated Board members who have committed to lead the contact to support this fund raising efforts.

Christine Maxwell presented to the Board a proposal to create an Associate/Society Membership category of ISOC, looking at the leverage and benefit that could be possible through relationships between established membership associations and ISOC. The Board agreed to charter a subcommittee to investigate the details associated with such an initiative and formulate a proposal for initial steps in this area. Christine Maxwell, Jose Luis Pardos and Susan Estrada will form this subcommittee of the Board.

The Board adopted Resolution 97-41 indicating a commitment to support the activities of the IETF in 1998.

Resolution 97-41 IETF Funding for 1998
RESOLVED, to include a budgeted expenditure of USD 250,000 to support the activities of the IETF within the 1998 ISOC budget.

The Board adopted the proposed 1998 ISOC Budget covering the month of January to allow the continued operation of the Society, noting that revisions to the budget concerning the INET’98 conference and revenue levels will be presented to the Board for approval in January.

Resolution 97-42 ISOC 1998 Budget
RESOLVED, to accept the ISOC 1998 budget, limiting expenditure regarding the INET portion to new expenses of up to USD 25,000, for enabling ISOC operations over the month of January.

13. Other Business

13.1 ISOC Policy Initiative

The Board received a presentation from Roger Cochetti of IBM concerning the proposal to form an ISOC Policy Committee. The proposal made to the Board was to from a body to act as a policy analysis body within a particular policy jurisdiction, to provide information regarding explanation and analysis of policy proposals to interested parties, as distinct from taking an active position with respect to advocacy for or against any particular policy proposals. The composition of such a committee was suggested to be a group of well informed and respected individuals.

The Board discussed the issues raised by this proposal, and chartered a subcommittee to investigate in further detail and report to the Board. The subcommittee members are Scott Bradner, Vint Cerf, John Gilmore, Dave Farber, Christian Huitema and Ole Jacobsen, who will work with Roger Cochetti to develop specific proposals in this area.

14. Next Meeting

The next meeting of the ISOC Board of Trustees is scheduled to be held on 20 – 21 July 1998 immediately prior to INET’98, qt Geneva, Switzerland.

15. Move to Adjourn

The meeting was adjourned at 1:45pm, 13 December 1997.

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