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To turn all of this into a business, Friedman relies on a lean staff of 20 in Austin. Several of his staff members have military-intelligence backgrounds. He sees the firm's outsider status as the key to its success. Stratfor's briefs don't sound like the usual Washington back-and-forthing, whereby agencies avoid dramatic declarations on the chance they might be wrong. Stratfor, says Friedman, takes pride in its independent voice. The Web's resources provide such a tremendous advantage that the Stratfor team has already been able to do away with at least one staple of 20th century spycraft. Says Friedman: "We never go to cocktail parties."

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