Network Solutions CEO resigns
Gabriel Battista resigns from his post as CEO of the world's primary domain name registry, Network Solutions.
The departure comes at a critical time for the Net addressing system as the U.S. government wants to give up its oversight of the infrastructure to let an international nonprofit corporation take over. This changeover will eventually put an end to Network Solutions' exclusive contract to register the most popular domains, ".com," ".net," and ".org."
Battista is planning to join Tel-Save Holdings as its chairman and chief executive. Tel-Save is a long-distance company, known for its pact with America Online to offer discounted phone service to the online giant's customers.
In a statement, Battista said "he was leaving with a great sense of accomplishment and that he was leaving behind a vibrant business, with a strong financial position and a strong management team." He added that he is leaving to take on "new challenges and a once-in-a-lifetime opportunity."
Network Solutions' stock closed down 3.12 points or 4.56 percent. Tel-Save Holdings, on the other hand, soared today, closing up 2.19 points or 12.9 percent.
Michael Daniels, chairman of Network Solutions' board, will take over Battista's duties while the company searches for a replacement.
"Gabe did a great job in getting the company in a position to go public and putting a management team in place that has been running the day-to-day business," Robert Korzeniewski, chief financial officer for Networks Solutions, said today.
For more than five years, Network Solutions has held a contract with the National Science Foundation to run the leading Net domain name registry. Last month, the company got a two-year extension to administer the official registrar until September 2000. However, the deal requires the publicly traded firm to share its "root" servers with competitors, meaning other players also will be able to be primary registrars before the turn of the century.
Network Solutions is not expected to lose its grip on the lucrative domain name registration business, according to analysts, because its 2.8 million customers have to renew their names every two years for $119 and likely will keep their accounts with the company.
In fact, Network Solutions beat Wall Street's expectations last month when it reported net revenues of $25.4 million for the quarter ended September 30, an increase of 109 percent over the $12.1 million posted for the quarter a year ago.
Still the management of the underpinnings of the Net is set for a major transformation that will impact the company. And Battista is just the latest key player to leave the negotiating table over the future of the domain name system.
White House senior adviser, Ira Magaziner, who was mediating the Net addressing system changes, also plans to resign at the end of the year. In addition, Internet Assigned Numbers Authority (IANA) founder Jon Postel died October 16 due to heart problems. IANA is funded by the U.S. government and runs the Net's numerical "phone book" behind the ".com," ".net," and ".org" domain names registered by Network Solutions.
A new nonprofit corporation known as the Internet Corporation for Assigned Numbers and Names (ICANN) is poised to take over the reigns from Network Solutions and IANA.
ICANN held its first public meeting Saturday, where it heard a wide range of concerns about its plan to oversee the technical infrastructure of the Net. At stake is the stability of the entire Internet, as well as a lot of money--primarily the profits now raked in by Network Solutions.
Network Solutions is not worried about losing revenue, however, because it has thousands of partnerships with Net access providers. "Distribution channels--I think that will prove to be our greatest strength," Korzeniewski noted.