US Government: You're Scaring Web Businesses Into Moving Out Of The US

http://www.techdirt.com/articles/20120216/17154217785/congrats-us-government-youre-scaring-web-businesses-into-moving-out-us.shtml

by pavel_lishin • 14 years ago

135 33 14 years ago

techdirt.com

daenz• 14 years ago

Consider rewording the title, it makes it sound like the US Govt is saying that.

wes-exp• 14 years ago

The US is still a great place for business, IMO, but sometimes I feel like I should be wearing one of those t-shirts that says "I'm with stupid", with an arrow pointing to DC.

alan_cx• 14 years ago

I see a time in the not to distant future where people in other countries start copying well used and know US sites and hosting them in say China. OK, China is scary, but what about, say, Poland? A kinda of whole website piracy. It might work because they can simply market the safe as being safe from the US government.

I'm thinking of sites like that forms site that suddenly got taken down wrecking the day of, what, millions of customers? How many of them might changed to an identical site that guarantees no US gov interference? Such people might not even realise its not the same people.

SkyMarshal• 14 years ago

Good point. Basically all user-generated content sites could leave the US for countries that continue to respect safe harbor provisions.

http://en.wikipedia.org/wiki/Digital_Millennium_Copyright_Ac...

rmc5• 14 years ago

Do other sites have "safe harbour" laws like that part of the DMCA? I'm not sure any do...

praxeologist2• 14 years ago

What does "Get corporate membership with EFF" mean?

Anyhow, I totally agree that the gov't is out of control. It isn't just with this copyright stuff either.

I sell electronic cigarettes and have an innovation to improve adoption with smokers. My product will undoubtedly be proven many times safer than smoking and more effective in helping people quit, but we face seizures and the threat of regulations which will shutter small businesses like mine.

I'm doing #4, "Migrate yourself to a non-US controlled country." as soon as I can afford to.

joering22• 14 years ago

serious question: were you aware who you trying to compete with (or step on a toe) before going into this business? I cannot imagine being successful in such a field competing with tobacoo brands who have such a strong lobbying representation.

praxeologist2• 14 years ago

Big Tobacco doesn't sell ecigs, yet anyhow. The more open opposition is from Big Pharma and those who make their living pushing "quit or die" vs. harm reduction.

I just found a way to better serve consumers what they wanted.. pretty standard entrepreneurial story. If everyone let the 90%+ fail rate of businesses scare them from trying, the world would seriously suck.

Part of what I need to do to succeed is recognizing the threat of legislation and finding a better place to do business. My point was that the ridiculousness of SOPA and such isn't new and hurts other parts of the economy too. (and I am genuinely curious what #0 means)

rmc5• 14 years ago

What does "Get corporate membership with EFF" mean?

Financially support an organisation that will defend your rights. It's like paying a retainer to a lawyer. You might not need them, but they will probably help fight for what's important to your business.

asto• 14 years ago

You're also scaring web consumers to pick non-US businesses. Do I want to purchase a service that can be shut down by the US govt with no notice whatsoever? No.

MichaelApproved• 14 years ago

Which country would you move to? No government of any country gives prior notice before shutting down a website.

nextparadigms2• 14 years ago

This wasn't possible in USA when they passed the Pro IP Act, just like they wanted to pass SOPA now. But people weren't aware of it, so it did pass. I'm afraid takedowns like these will continue until the Pro IP Act is repealed.

This is why it's so important citizens are aware of what goes on in Washington, and move to stop a bill if it's too dangerous. Because if it does pass, it will probably be a decade or more before people even start thinking about repealing a bad law. What's worse is by then, a few more bills will pass to enforce that one.

aytekin• 14 years ago

When I saw the title I first thought they saw this forum thread about how a Canadian business has switched away from using JotForm and how they are considering to stop purchasing from all US based online companies: http://www.jotform.com/answers/77171-Recent-Domain-Suspensio...

By the way, Techdirt's Mike is such a great guy. He has been very supportive and he even introduced us to some lawyers.

Natsu• 14 years ago

Is it just me, or have a fair number of HN comments or references thereof been showing up in stories lately?

This is what, the third one or something in about a week?

Yaggo3• 14 years ago

> 3. Migrate DNS, web serving and other critical services to non-US based servers.

What non-US alternatives there exist e.g. for Amazon?

sokoloff• 14 years ago

AWS has regions in Ireland, Singapore and Brazil at least.

AWS is still a US company, but they offer services from non-US DCs.

Yaggo3• 14 years ago

> AWS is still a US company [...]

That's the very problem (i.e. US legislation), not the physical locations of DCs.

Yaggo3• 14 years ago

(Answering myself.)

Not in the same league with Amazon, but still interesting:

http://www.greenqloud.com/

Using 100% renewable energy (not just co2-neutralized), located in Iceland (they have sane IP laws AFAIK), and claiming to be "AWS EC2 and S3 drop-in replacement".

yason• 14 years ago

The better the services and environment for doing business, the more extortionist tactics you can apply and still keep the majority of the business.

rmc5• 14 years ago

A lot of this is due to the current US control of the .com namespace.

I wonder what'll happen when/if the US shuts down some non-US business's .com, and that business starts getting court orders to force local ISPs to resolve that. It would either lead to a split in the .com namespace, or international diplomatic agreements on DNS (like how there is international maritime law about what happens in international waters). This would make the USA no longer have control over it.

pchivers• 14 years ago

The U.S. government has already shut down non-U.S. .com domains (PokerStars, Fult Tilt Poker, Cereus).

http://en.wikipedia.org/wiki/United_States_v._Scheinberg

rmc5• 14 years ago

Things only get Interesting™ when the non-US companies start kicking up a fuss, and succeeding in kicking up a fuss, in other countries.

backrecord3• 14 years ago

The reason we have not submitted an application for YCombinator is actually simply that we perceive the US to be a bad place to be incorporated. Not just for the reason stated in this article of course, hacker news is frequently littered with other reasons as well. My understanding is the requirement to incorporate as a Delaware company is fairly strict requirement for YC companies. Can someone verify this? (we're already incorporated in Singapore).

ThaddeusQuay22• 14 years ago

After reading various reasons as to why it's bad to be incorporated in the US, you held off on applying to YC, but you are still using GoDaddy? Moving from Singapore to the US is a hard decision. Switching from a sleazy registrar to one that isn't, isn't.

backrecord3• 14 years ago

Good observation... the only reason backrecord.com is still with godaddy is lack of time to make sure I have a process worked out to do it without any downtime. I actually transferred more than 20 domains because of SOPA and can assure you the others will be transferred at some point relatively soon. backrecord.net for instance is no longer with godaddy.

jandrewrogers• 14 years ago

There are good reasons to incorporate in US states like Delaware, it is not coincidence that so many (non-YC) tech companies are incorporated there. Note that you incorporate in US states, not in "the US", and states offer very different jurisdictions. Here is a quick explanation of why selection of corporate jurisdiction is important:

1) You want to select a jurisdiction that has clean, flexible, and stable set of corporate laws that have already been through judicial review. This provides a robust foundation for corporate structure with few legal unknowns or political risks.

2) Important for investors, the corporate laws must be fair to all parties involved. For example, a jurisdiction with corporate laws that allow a minority shareholder or employee to screw the majority shareholders or hold the company hostage is bad and greatly increases investor risk. There are many jurisdictions that are like this, even in the US. It is one of the reasons you never see tech companies incorporated in California, for example, even though Silicon Valley is there.

3) A jurisdiction that operates under English Common Law is convenient because it is the common basis of contract law used in business, particularly if it involves parties in multiple jurisdictions. Delaware is a nice example of such a jurisdiction with a long, sane, and mature judicial history.

Jurisdictions like Delaware are among the very best in the world for everyone involved if you are building an investor-backed business. Startups that are not incorporated there often have to reincorporate in a place like Delaware as a condition of investment. It is all about having a stable, scalable, and fair set of legal rules on which to build the company.

The average startup faces much more risk from being in a poor jurisdiction than whatever risk you perceive from being incorporated in the US. Investors know this and proper jurisdiction selection is an inexpensive way of reducing the total risk to startup success.

backrecord3• 14 years ago

Lots of very very good reasons for Delaware, yes. It totally makes sense for yc to have this as a rigid rule.. Still I'm interested to know if they have ever made an exception for anyone, and if so who and why.

sarcasmatron• 14 years ago

At this point, use of GoDaddy at any point should be noted in any Due Diligence process by investors.

If the founders are unable to identify using GoDaddy as an unacceptable risk and are unable to quickly find an alternative, then one might justifiably come to the conclusion that said founders don't know what they're doing.

If an investor is unable to recognize the risk, then one might justifiably come to the conclusion that they don't know what they're doing, and should stick to Real Estate Development and Direct Mail advertising.

Personally, I like gandi.net for domain registration and hosting. They're not the cheapest, but they're not in the US.

US Government: You're Scaring Web Businesses Into Moving Out Of The US

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