The Untold Story of SAIC, Network Solutions, and the Rise of the Web—Part 2

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Network Solutions Inc. (NSI) because of its work in computer networking. They had contracts to install networks for the government and other customers. We initially were not very conscious of the fact that Network Solutions was the domain name manager for the Internet. It finally dawned on us that this was indeed the case and that we had acquired a real jewel. That was the basis for our acquisition. Network Solutions remained as part of SAIC for a number of years until it got so big and became so political because of our monopoly that we decided to sell it to VeriSign.

Mike Daniels

Mike Daniels

Mike Daniels: I met the management of Network Solutions in February 1987, just two months after I sold our company, Computer Systems Management, to SAIC. Over the next few years, I continued talking with the CEO, Emmit McHenry, and the other three owners of NSI. So I knew when the National Science Foundation awarded Network Solutions a cooperative agreement to register Internet domain names in late 1992 or early 1993.

At the same time, I was making a number of business trips to Silicon Valley. I had been meeting with folks at Netscape, and with others who were getting involved in the commercialization of the Internet. So I realized this was going to be a major new wave of technology, and we should get in on it in some way. This led me to begin talking to NSI more seriously. I did not know the timing or the size of the Internet boom, but I believed that there was a big potential business building up here for the future.

X: How much was the Network Solutions acquisition?

JRB: $4.7 million.

X: How did your understanding of Network Solutions’ business change after SAIC took over?

JRB: We soon discovered that the Internet was taking off in the U.S. and the number of domain names being registered with us was growing exponentially. NSF, for a while, paid for the customers to acquire domain names. However, once we acquired NSI, we had to start charging fees. We charged $100 to acquire a domain name. Most of the funds we earned by … Next Page »

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Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at or call (619) 669-8788 Follow @bvbigelow

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  • Joe

    Ugh…..VeriSign! Overpriced SSL certs.

  • Lee

    Great article!

    What was Mr McHenry thinking! He had the oyster in his hands. I know he did well in the sale of NSI but if he just could have hung on for a few more years. Was he forced to sell? As soon as SAIC took control of the domain industry it became an ever growing monopolistic mountain of hundred dollar bills. I have to think that Mr. McHenry knew what was going to happen but was not allowed to put prices on each registration. Anyone know?