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Technology Stocks : Network Associates (NET) -- Ignore unavailable to you. Want to Upgrade?

To: Shelia Jones who wrote (2198)	3/20/1998 11:24:00 PM
From: Richard Haugland	Read Replies (1) \| Respond to of 6021

I find it hard to believe that strictly this one concern could have caused such a drop today. Hoping most of the rest can be attributed to triple witching. IMO, probably a combination of ingredients of which the second downgrade in two days of SOLLY was perhaps the biggest. SOLLY went down by a larger percentage than NETA and was down even more precipitously at one time. Uncertainties on the encryption probably contributed a share but, IMO, could be a BIG revenue source if eventually permitted. Triple witching also contributed. The BIG volume in NETA puts yesterday Message 3775099 looks VERY suspicious. Profit taking after a solid run-up of NETA also contributed, as did the generally terrible day for most tech stocks. Another quote from the Commerce Secretary's press release: But the government fears encryption will be used by crooks to hide criminal acts. The FBI favors requiring a back door in all encryption, allowing agents to read any coded message. Under current policy, U.S. citizens are free to use any form of encryption, but stronger products cannot be exported unless they include a means for the government to break any coded message. Above sounds about as effective long term as U.S. gun-ownership bans, anti-nuclear proliferation bans, and most U.S. anti-drug laws. All the crooks need to do is be a US citizen! Also, the whole attitude of the government that NETA could not have done the development outside the U.S. without exporting "secrets" seems arrogant. The following is consistent with the conclusion that the U.S. will blow the commercial opportunity in this area: Congress is debating a variety of proposals to change encryption regulations, ranging from a plan to require back doors in software used by U.S. citizens to bills that would nearly eliminate the current export limits. and The Commerce Department has successfully stymied a similar plan to evade export restrictions announced last year by Sun Microsystems. Reinsch declined to comment on the Sun encryption plan. I particularly liked the part of the Commerce Secretary's quote: The government will seek to learn if the company illegally exported any encryption to make the products abroad. Also, the government will directly review the products, which could be deemed subject to U.S. export rules if they contain more than 25 percent U.S. content, Reinsch said. The 25% content rule sounds just like automobile manufacturing or rag content of paper. How does one measure content of software?