In an editorial piece by Cnet, Nicholas Merrill describes his upcoming Internet service, Calyx, as a "non-profit telecommunications provider dedicated to privacy, using ubiquitous encryption". According to Merrill, his goal is to fully encrypt Internet traffic at the ISP level in order to protect the privacy of his customers. In fact, he hopes to create a system that is so private, even the ISP itself is unable to snoop on its users. Such a system could conceivably make it impossible for the ISP to respond to privacy-infringing requests, even when compelled by big media conglomerates, public officials or authorities.
The legal viability of an all-encrypted ISP appears to hinge on a provision in a 1994 federal law called CALEA. The Communications Assistance for Law Enforcement Act ensures that ISPs are not held responsible for decrypting data if they don't have the necessary information to do so. If Merrill has his way, Calyx won't have a clue what's going on under the hood of its service. This means the ISP should be able to operate squarely under this premise.
After running his own ISP in New York, Merrill picked up a thing or two about the need for privacy in today's post-9/11 climate. In 2004, he enlisted the help of the ACLU to legally fight a request by the FBI to divulge customer details without a court order. To make this situation particularly menacing, the FBI required Merrill to never publicly disclose the request or the existence of the letter. After a lengthy six-year legal scuffle and having to remain anonymous throughout the course of the trial, Merrill won the case and a federal judge struck down a portion of the Patriot Act which made it illegal to defy an FBI gag order. United States District Judge Victor Marrero described the provision as an "unconstitutional prior restraint of speech in violation of the First Amendment."
After dealing with the FBI and the U.S. legal system for six years, the entrepreneur was inspired to design an ISP where privacy is integrated into its virtual DNA. As a result, Merrill has created the Calyx Institute and woven together an advisory board with the likes of former NSA technical director Brian Snow and TOR project leader Jacob Applebaum.
Merrill will be meeting up with potential West-coast investors in the next couple weeks as he attempts to raise $2 million before the service launches.