BD: Re: SCN: "Free-Nets" in Los Angeles Times
patrick
clariun at yahoo.com
Sun Dec 30 01:37:04 PST 2001
Comments follow:
--- Steve Guest <steve at groupworks.org> wrote:
> Well we could debate this for months. Let me clear up a few things
> first:
> 1) We are technically an ISP, but since Microsoft started putting
> the connect to the internet icon on its desk top the idea of what
> is an ISP has changed.
Microsoft tried to change the idea of what an ISP was/is, but they
didn't get too far. They thought the net would take over the regular
desktop operating system when they felt the threat from Netscape.
Didn't happen, and I doubt the .NET idea will change much either.
We are an ISP which does not offer direct
> connection to the Internet, only to a server on the Internet. We
> were and still are a founding member of Washington Association of
> Internet Service Providers (WAISP) which is a lobbying group. But
> due to the failure of most of the local ISPs to either survive or
> not get eaten by the national big fish, WAISP could soon die from a
> lack of membership. So it depends on your definition of an ISP.
> 2) As far as the costs for an ISP - these are well know and we
> have investigated them. If we were to take NWNexos for example, it
> had a budget of several millions when WindStar bought it and still
> it failed to be profitable. There are way too many factors to make
> this a simple calculation. We would also change our profile and
> start to impact others like wolfnet, drizzle and eskimo. There are
> several ISPs open to offers in the area, go look at their books if
> you think this is a viable proposition. From my costings, I worked
> out that we would need about $5-10 Million a year for SCN's
> operations and service to be "professional", plus a major culture
> shift.
Sounds like a dotcom budget. How many Herman Miller chairs is that?
Eskimo has about 2000 customers and they pay about 200 dollars a year
(being generous here), so that's about 400,000 a year. A tenth or
twentieth of your costings.
Not to be critical, just pointing this out.
Which is way too many $10 customers.
> 3) I am confused by the 501(c)3 comment. Lobbying is not a high
> priority for SCNA at present. The thing that Eugene did, as far as
> I can see, is that it needed money and decided to do a fee for
> service. They didn't read the small print though. Any fee for
> service is fine if the service is educational, but as a connection
> to the Internet, it is deemed by the IRS to not be educational.
> They currently agree that the service is educational, but the
> connection to the internet is offered by 100s of other vendors
> which are commercial. Therefore this breaks the 501(c)3 agreement
> with the IRS. Plus it brings us back to the first point - we are a
> connection to a "service" which is educational and on the Internet.
>
> Personally, if I thought a for-profit with low cost for service
> would make a profit, I would be doing that rather than working for
> SCN as a volunteer CEO. Plus I think I know where I could have
> gotten a few "staff" that might wish to work for me rather than
> volunteering. So if running a cheap access ISP were profitable,
> then where are they? They came and most went with the dot.coms.
This is a contradiction of a previous post where it was mentioned
that there were many low-cost ISPs around the area. Again, not to be
critical, just pointing this out.
Also, the Victoria company: I realize that Canadian laws are
different concerning non-profits, but still, the company still
manages to provide accounts at about $100 dollars a year. And is that
Canadian dollars?
Again, it would be "nice" if SCN could find a way to provide low-cost
ISP service.
That is my only point.
Patrick
>
> Steve
> =*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=
> Steve Guest steveg at scn.org steve at groupworks.org
> VP of Board and ED of Seattle Community Network
> (425) 653 7353 http://www.scn.org/
>
> ----- Original Message -----
> From: emailer1
> To: Marilyn Sheck ; scna-board at scn.org ; steveg at scn.org
> Cc: douglas at scn.org ; scn at scn.org
> Sent: Thursday, December 27, 2001 1:42 AM
> Subject: Re: BD: Re: SCN: "Free-Nets" in Los Angeles Times
>
>
> The key part of Steve Guest's message is the following:
> ____________________
> "I do not see SCN being able to commit
> to supplying free full internet access for our users.
>
> Plus - this was not what SCN was designed to offer. It is
> initialy an
> email and maillist site which grew into a major web resource for
> Seattle.
> We were never in the free ISP business."
> _____________________
>
> The above contains a Catch 22 element. (1) We do not have the
> funds and staff to support a full ISP (including standard graphical
> functions); and (2) we will continue to offer a very limited type
> of service and so we will NEVER attract or bring in the funds to
> support such a full ISP service.
>
> Rather than mere speculation, it will be necessary to get a
> proper accounting (indepent) to determine
> 1. How much funding it would take to operate an independent,
> proper ISP. (Staff and hardware)
> 2. How many paying subscribers it would take (at $10/month) to
> support such an ISP service. (This price would under cut almost
> all other services.)
> 3. How many low-income subscriptions could be offered for little
> or no cost under this full ISP scenario.
>
> If the answers to 1 and 2 are positive (i.e., it would be doable
> to get enough subscribers to fully fund all aspects of a complete
> ISP service), THEN it would be appropriate to discuss abandoning
> the tax-free status and switch to a for-profit service.
>
> By the way, the tax-free status comes at a cost: SCNA cannot
> lobby. SCNA, like Eugene was, is severely limited by the IRS as to
> what low-income services it can offer and as to what philosophical
> stance it can follow actively.
>
> The library connection also has similar costs. If SCNA actually
> did become active (read "controversial"), the library could no
> longer provide free connection. As Steve pointed out, "(SCN)A is
> initialy an email and maillist site." The design of the
> organization is limited by that earlier small mission. Keeping the
> library "sponsorship" and the subsequent tax-free status prevent
> SCNA from being a desireable ISP and from being an effective
> community influence.
>
> Until an independent accounting can answer 1, 2, & 3, there is no
> way to describe SCNA's potential or future. It can only continue
> to drift.
>
> P.S.
>
> About the statement: "We were never in the free ISP business."
>
> Actually, that is exactly what we used to tell everyone -- that
> we WERE a free ISP.
>
> ----- Original Message -----
> From: Marilyn Sheck
> To: scna-board at scn.org ; steveg at scn.org
> Cc: douglas at scn.org ; scn at scn.org
> Sent: Friday, December 21, 2001 1:53 PM
> Subject: Re: BD: Re: SCN: "Free-Nets" in Los Angeles Times
>
>
> Well said, Steve. And, YES, you are right about the library
> not being able
> to sustain your internet feed if your traffic increased. We
> are already having
> trouble with our bandwidth just with SCN in its present form
> combined with
> our own services. We would not be able to use public funds,
> which is what
> we pay for the Internet connection with, to support SCN's
> connection if it
> is more than a small fraction of our overall bandwidth usage.
>
> >>> steveg at scn.org 12/21/01 01:08PM >>>
> Hi
> Well first off we do have free dialup service. On the other
> hand, this is
> basic command style access and not FREE Internet access. I
> agree it would
> be great to offer such services, but we have address some
> important issues
> first.
>
> Let me try and explain why we do not have free internet access.
>
> 1) If we were to offer free unrestricted connections to the
> Internet via
> our free dial service and our SPL donated connection to the
> Internet, then
> the traffic which SCN uses would jump considerably. This would
> be
> followed by the lose of our donated Internet feed, because
> currently I
> have been led to believe that the Library would not be able to
> justify the
> cost of the service. This would mean that we would have to
> provide our
> own Internet feed. At this point we raise the need then to be
> in the
> Library because we are then simply taking up their limited
> space. So if
> this was to happen then SCN would have to cover the phone
> lines, the
> Internet feed and possible the cost of a new location. We do
> not have the
> budget for this and we would be out of funds within months or
> weeks.
>
> 2) If we were to offer such a service with a fee, as indicated
> that
> Victoria in Canada does, then we open another can of worms.
> First lets
> point out we are not in Canada and therefore have a whole
> different set of
> rules to abide by. One of these is the IRS. They are already
> looking at
> FreeNets because our "charitable" status is based on the
> educational value
> of the service. As soon as we set up a competing service with
> a
> commercial service such as MSN or AOL - fee for service - in an
> area which
> is not directly education then we fall outside the charitable
> status.
> Thus we lose the 501(c)3 status. This is what happened or is
> happening to
> Eugene FreeNet. They had to setup a commercial company to sell
> their fee
> for service IP connections and break away from the educational
> section.
> Again something that would put us at odds with the Library and
> its
> donation to us.
>
> The IRS are still sniping and they have not yet gotten to SCN,
> but we are
> in their sights. We have to be careful and stay legal.
>
> Until we can figure out the IRS's view of this, understand the
> Library's
> view, have the funds and staff to support this and the software
> to ensure
> that we can guard against misuse - I do not see SCN being able
> to commit
> to supplying free full internet access for our users.
>
> Plus - this was not what SCN was designed to offer. It is
> initialy an
> email and maillist site which grew into a major web resource
> for Seattle.
> We were never in the free ISP business.
>
> I hope this response is clear. I am not trying to say we
> cannot discuss
> these points, but we need to ensure that we can support our
> current
> services before we branch into others.
>
> Steve
> =*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=*=
> Steve Guest steveg at scn.org steve at groupworks.org
> VP of Board and ED of Seattle Community Network
> (425) 653 7353
> http://www.scn.org/
>
> On Thu, 20 Dec 2001, patrick wrote:
>
> > I wish SCN had low-cost, regular dial-up service. Victoria
> freenet
> > has regular dial-up service for $104 a year, which is a great
> deal.
> >
> > Few people use Lynx and after they have used Hotmail or some
> other
> > web-based service to check their mail, after they have surfed
> the net
> > to check on items on eBay, etc., one would find it hard to go
> to a
> > clunky Lynx browswer to surf the web.
> >
> > Patrick
> >
> > --- Doug Schuler <douglas at scn.org> wrote:
> > >
> > > A good article entitled "Freenets Getting a New Lease on
> Life" is
> > > in today's Los Angeles Times.
> > >
> > >
> >
>
http://www.latimes.com/technology/la-000100643dec20.story?coll=la%2Dheadlines%2Dtechnology
> > >
> > > -- Doug
> > >
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