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While new generic top-level domains (gTLDs) wait for ICANN to announce an application date, country-code top-level domains (ccTLDs) continue to migrate in large numbers to CoCCA, the registry software system which shares a codebase with Minds + Machines’ Espresso registry system.

Dot Masr, the Arabic-script ccTLD for Egypt, successfully deployed today on the CoCCA system. The National Telecom Regulatory Authority of Egypt (NTRA) has deployed its production domain name registry system for Egypt’s internationalized domain name country-code top-level domain (IDN ccTLD).

Egypt joins Kenya (.ke), Madagascar (.mg), Mauritius (.mu), Nigeria (.ng), Cameroon (.cm), Mozambique (.mz) , Namibia (.na), Egypt ASCII (.eg) and several other African countries in deploying the CoCCA registry system. In the second quarter of 2010 alone, six ccTLDs have migrated to CoCCA: Greenland (.gl), Guernsey (.gg), Jersey (.je), Palestine (.ps); and American Samoa (.as) will be migrating to CoCCA. By a wide margin, CoCCA is the most widely deployed top-level domain registry system in the world, supporting over 30 ccTLDs.

One of the pluses of being a veteran of ICANN meetings is the ability to pare down the schedule to what is relevant for our business plans. Minds + Machines will be focused on new gTLDs in Brussels. Following are my circled-with-a-big-red-pen session suggestions for those interested in new gTLDs.

Saturday, June 19

• 15:00 – 17:00 – The Government Advisory Committee (GAC) will discuss developments in the New gTLD process, including the latest Draft Applicant Guidebook (DAG 4), TLD categories, and geographic names. Many of the changes in DAG 4 are the direct outcome of GAC recommendations. If you want a preview of how the rest of the week will play out, don’t miss this meeting.

Sunday, June 20

The Generic Names Supporting Organization (GNSO) has two working sessions on New gTLDs.

• 09:00 – 10:15. Start the day observing the Vertical Integration PDP Working Group meeting with the GNSO Council. At the ICANN meeting in Nairobi, the Board pushed the community to resolve the debate on cross-ownership of registries and registrars by instituting a zero percent cross-ownership rule. This resolution disrupted some high-profile business plans. However, the Board will consider an alternate policy from the GNSO if one is created prior to the launch of the new gTLD program. Nearly 100 community members have participated in the Working Group to formulate a new policy.
• From 14:00 – 17:00 is the GNSO’s New gTLD Working Session. The GNSO will also be briefed on DAG 4 by Kurt Pritz, ICANN’s Senior Vice President.

Monday, June 21

Though some very important work is done during the three previous days, the meeting officially opens on Monday, June 21. If you are interested in the technical side of TLDs, drop in on the ccTLD Tech Day, where registry operators discuss implementing the latest standards and share experiences.

• 15:30 -17:30. Kurt Pritz will take the stage to brief the entire community on the status of the New gTLD program, the highlights of DAG 4 and — not to be missed — an accounting of the remaining open issues.

Tuesday, June 22

• 10:00 – 11:00. The new gTLD highlight on the schedule for Tuesday, a.k.a. “Constituency Day,” is the GAC’s discussion of Morality and Public order, a remaining overarching issue. Attend if you want a glimpse of how this issue could play out.

Wednesday, June 23

• 12:30 – 14:00. Update on Vertical Integration.
• 16:00 – 17:30. A panel discussion on “Reducing Barriers to New gTLD Creation in Developing Regions.” Board Resolution 20 in at the last ICANN meeting in Nairobi requested that the community “develop a sustainable approach to providing support to applicants requiring assistance in applying for and operating new gTLDs.” Working Group members will announce several proposals for consideration. Some of the proposals will be controversial as there is a requirement to recover the costs of new gTLD applications and on-going services to new gTLDs. Applicants, registry service providers, and incumbents will all benefit from attending this session.
• 16:00 – 17:30. Next door, at the same time, panelists will discuss “What brand protection and management measures entities need to consider before, during, and after the launch of the new gTLD program.”

Thursday, June 24.

• 13:30 – 18:00. You can sleep in Thursday morning, because the important public forum is scheduled for the afternoon. This is the time to speak your mind and ask questions directly to the Board before they lock down and decide how to vote on the issues Friday.

The schedule does change leading up to and throughout the meeting, so be sure to double-check the full schedule every morning to confirm dates and times.

Minds + Machines will have multiple representatives at the ICANN Brussels meeting, and we’d be glad to meet with you about our registry services, or just point you in the right direction. You’ll recognize us by our Minds + Machines lapel pins.

Today Top Level Domain Holdings, Ltd., Minds + Machines’ parent company, issued a statement summarizing our view of the progress at ICANN. The full text is included below:

The Board of TLDH announces that the Internet Corporation for Assigned Names and Numbers (“ICANN”) has now released the fourth version of the Draft Applicant Guidebook for generic top-level domains (“gTLDs”). This is in line with the decision reached by ICANN’s Board of Directors at its Nairobi meeting in March where it resolved to focus on the full introduction of gTLDs later this year rather than implement an intermediate step by adoption of the expressions of interest/pre-registrations proposal.

As reported by ICANN staff during the Nairobi meeting, the draft guidebook is expected to be the last draft before the final guidebook which is expected to be published in October / November 2010, according to ICANN’s project plan. The new draft guidebook includes an expanded role for public comments on gTLD applications, as well as incorporating various measures to protect intellectual property as proposed by ICANN participants.

The new draft guidebook keeps in place the strict separations of cross-ownership and control between registries and registrars, placing significant barriers in front of registrars who wish to start new top-level domains. If this restriction remains in the final guidebook, the Board of TLDH believes that a number of potential competitors will find it difficult or impossible to enter the market. TLDH is unaffected by this policy and the Board of TLDH therefore expects that TLDH will benefit from this continuing separation between registrars and registries.

ICANN has also released other supporting documents in relation to the proposed gTLD application process, including a budget for the new generic top-level domain review process. The budget document is based on ICANN’s assumptions that there will be 500 gTLD applications, of which 5 per cent are assumed to fail the initial evaluation and a further 5 per cent are assumed to request voluntary partial refunds. Accordingly, ICANN’s budget assumes that 90 per cent. of all applications will proceed to either successful delegation, or in the case of conflicting applications, to an auction or other tie-breaking resolution.

The other few and mostly small changes in the new draft guidebook suggest that there is near-consensus among ICANN and industry participants and governments and that the application guidebook is near completion.

TLDH remains well-positioned to move forward with its plans for new top-level domains. The next meeting of ICANN will be held in Brussels from June 20 – 25. TLDH and its operating subsidiary, Minds + Machines LLC, will be participating in the ICANN meeting and will provide a further update following that meeting.

I’ve been reading through some of the raft of documents ICANN released earlier this week. Among them is ICANN’s New gTLD Program Budget, which contains good news for new gTLD applicants.

ICANN reveals that it expects just 5% of applications to fail the initial evaluations, and another 5% to request refunds prior to the end of the evaluation stage. This means that they’re intending to pass approximately 90% of the applications — in other words, ICANN’s intent is not to fail applications by finding trivial faults, but rather to simply make sure that they’re operationally and financially sound. That is excellent news.

ICANN also reveals what it expects from the gTLD application round. Among the highlights:

• ICANN estimates 500 applications. The don’t estimate the number of duplicate or conflicting applications, but if we suppose that 25% are in conflict, that would leave us with approximately 425 unique TLDs applied for. Subtracting a further 10% who drop out, that leaves 382 new TLDs that we can expect to see delegated.
• ICANN expects the majority of gTLD applications to be “straightforward,” with no need for complicated and time-consuming procedures. More good news for applicants.
• ICANN expects the Independent Objector to file objections in less than 5% of the total applications. Again, ICANN’s intent does not seem to be to find fault.

It’s good to see these numbers from ICANN, which shows that they want their program to succeed with a full complement of new gTLDs. 382 of them, by my reading.

I’m guessing that few people have bothered to read the gTLD Registry Transition Processes document, which came out earlier this week, along with the Draft Applicant Guidebook (DAG) Version 4. Its name promises a very boring recitation of things to do when a registry needs to make a transition, which is of interest to no-one just yet because ICANN hasn’t even started the process to create any of the new registries that might one day be transitioned.

And yet there are in it some eye-opening clues about how ICANN is going to try to regulate the new gTLDs.

The document opens with a portentous recounting of ICANN’s core values, specifically “Core Value #1,” which is “preserving and enhancing the operational stability, reliability, security, and global interoperability of the Internet.” The idea is that if a registry changes hands, the transition must be undertaken in a way that Core Value #1 is preserved.

So far so good. But once we move past this catechism, we find that the document is just as concerned with preserving and extending the political levers that have been gradually inserted into the DAG over the last year. We find that “transition” means not just changing ownership, or wholesale replacement of the back-end registry, but also very minor things like name changes or small parts of outsourced technical services, and that any changes might need approval of third parties, including governments. It introduces dangerous consequences for any breach (even minor) of the Registry Agreement, including an entire re-evaluation of the registry similar to the initial application process. New “Emergency Operators” will be contracted to take over a registry in the case where ICANN determines that there’s a problem. And all of this will mean new fees and new bureaucracy.

Here is ICANN’s matrix for the kind of evaluation will be required.

In more detail, this is what registries of new gTLDs can look forward to:

Name Change

If the registry wants to change its name, it will be re-evaluated to “ensur[e] it is legitimate to guarantee there is no opportunity for hijacking the TLD.” The language is symptomatic of ICANN’s attitude to applicants, which is to treat them as potential scoundrels. This is in marked contrast to its attitude toward some government players, who are actual, verifiable, proven scoundrels (see “IDN ccTLDs for corrupt states, fast-track process for”). I am not sure what “hijacking the TLD” might mean, and the document does not explain. Suffice it to say that changing your name from “123 Inc.” to “1234 Inc.” will bring ICANN’s suspecting scrutiny upon you.

Sale of Registry

Selling your registry will now be more like selling your co-op in New York City. It’s not enough to find a buyer; you have to convince the Board of the buyer’s worthiness. The Board will put the buyer through the same wringer that you went through as an original applicant, with the same level of fees, and they can turn down the buyer for any number of reasons. There will be an evaluation of fitness from a technical, financial, and “due diligence” perspective. This last category is not defined but presumably refers to the new extensive background check. There is as yet no objection process for governments or the IP lobby to air their fears, but I would be surprised to not see this coming in further iterations of this document. One effect of this policy will be to make a sale to an existing player much easier than to a new entrant, thus concentrating commercial power and discouraging competition.

Fees

Each new owner (even if it’s the same one, with a new name) will have to go through some evaluation process. Every 3rd-party evaluator has to be paid. ICANN does not specify the dollar amounts, but I wouldn’t look for a bargain here. A full-on evaluation could easily run into the hundreds of thousands of dollars.

Geographical TLDs

In a sale (or even, apparently, for a simple name change) the new owner will have to gather the same governmental support or non-objection letters that the original applicant did. Effectively, the relevant government(s) will have veto power. In addition, despite language that creates a presumption of renewal of registry contracts at the end of the contract term, governments are now given the power to withdraw their support of the current registry in favor of another. Normally I would congratulate government officials on their sudden access to season tickets, expensive lunches, and access to no-show jobs should they ever leave the employ of the people, but in fact the model that ICANN supposes is unlikely to exist: I believe that in just about every case it will be the government who holds the delegation to geographical TLDs, and they will hire out the technical functions, preserving their power to do whatever they want, whenever they want.

Community TLDs

Running the registry for a community TLD just got much worse. ICANN’s new rules insert the nebulous concept of “community” directly into the operational life of the registry, instead of just the policy aspects. So, if you are the registry for a community TLD and want to change your name or move to a new back-end provider, your community must be “consulted.” No mechanism is specified about how to consult a community, so chaos is invited. I wonder what consulting the community of Harley Davidson enthusiasts looks like…

Registries in Breach of Contract

A registry may find that ICANN decides that it is in breach of its registry agreement with ICANN. This breach could be because of non-payment of fees, excessive downtime of the WhoIs server, or whatever. If it is uncured, a re-evaluation will follow before the registry is allowed to resume operations. The re-evaluation may include recertification by a government, approval by a relevant community, and other “due diligence” items. It’s just like applying for the first time.

Emergency Back-End Registry Operators

Here is a new beast, the Emergency Operator. Aspirants for this position will fill out an RFP and if they are chosen will be paid to be on stand-by until there’s an emergency, at which point they will be paid to be emergency responders, which ICANN “expects” will be on a cost-recovery basis. They are for the case where a registry can’t perform its functions properly. It’s a good idea in theory, but I wonder what exactly a third party can do in an emergency. A registry has two essential functions: the register (the list of names and associated data) and the resolution (DNS). There are other functions such as a WhoIs server. In this era of hyper-redundant anycast DNS I don’t see resolution being much of an issue. As to the register function, if it’s screwed up, it’s likely to be because of bad processes and bad record keeping, which lead to bad data, and this is not really fixable in an emergency; the whole thing needs to be checked and rebuilt. These new Emergency Operators will have to enter into contracts (“lightweight contracts,” ICANN suggests) with the registrars of the existing registries for which they are backups, creating a whole new layer of bureaucracy. I understand the idea, but wonder if the cure might be worse than the disease.

Summary

The Registry Transition Processes document is a clue to what it’s going to be like to run (or sell) a registry under the new ICANN regulatory regime. For the first time there is a semi-official recognition of the back-end registry operator; there are new colo-rectal exams whenever there is acquisition or other change in corporate structure; there are new fees; and there is an expanded role for governments, whose mission-creep is seen in all areas of ICANN these days.

One effect of this new regime will be to create heavy incentives for registries to stick with whatever back-end registry provider they happen to have. It’s not quite lock-in, but it’s close, because choosing a new one will carry significant costs and risks. The big winners here are the providers of back-end registry services.

If you’re thinking of applying for a new gTLD, you should familiarize yourself with the full document, and comment on it, because it’s going to be important for the life of your registry after delegation.

Today ICANN released it’s latest version its Draft Applicant Guidebook (DAG) for new generic top-level domains. It’s been 9 months coming; DAG3 appeared in the fall of last year. Compared to DAG3, there are only minor changes (see the redlined version of the document). Overall we are satisfied with the new DAG, as we were with the previous version, which came out nine months ago.

There are few substantial changes from the previous version, which is good news. It suggests that we are almost at the end of this process, and provides an indication that this will be the final DAG before the Final Applicant Guidebook.

The major changes (which really aren’t that major) are as follows:

• An expanded role for public comment (Section 1.1.2.5), which is a wide-open back door for objections to applications which pass all of ICANN’s objective criteria, but are still not liked by the various powerful interests that have held up this process for so long. In this way ICANN can claim to have an objective process while leaving an avenue open for meddling in case something “objectionable” gets through. It’s not a stretch to presume that the .XXX fiasco was on the minds of ICANN as this was drafted.
• Cross-ownership of registry and registrar (Section 1.2.1). This version of the DAG has strict separation between registrar and registry, but with a footnote saying this is open to change if the “community” comes up with a better solution. The “community” now discussing this is the Vertical Integration Working Group, which consists almost wholly of registrars and registries aiming competing proposals at each other. The proposals vary in their details but are uniform in giving short shrift to idea that might help the consumer, but very thorough when it comes to advocating what might help the proposer. It is likely that in the final applicant guidebook we will see some limited cross-ownership possibilities, fine-tuned to please incumbent players.
• $5000 of the $185,000 fee is now due when registering to apply (Section 1.5.1). Applicants will create a new registration for each TLD they plan to apply for, and will have to pay $5000 for the privilege. The remaining $180,000 is due with the application itself.
• An expanded background check for applicants (Section 2.1). As well as the usual things that can disqualify a person or entity from running a piece of public infrastructure (corruption, bribery, terrorism), ICANN has added another great evil of our times, “intellectual property violations.” If for some reason you don’t think that intellectual property violations rank with terrorism in the pantheon of Bad Things, please have a chat with ICANN’s Intellectual Property Constituency, who will set you straight. For extra credit, ask them who was behind this amendment and watch for expressions of astonished innocence.
• Some small changes to the treatment of geographical names (Section 2.2.1.4.2). The DAG is now explicit that if you want to do apply for a gTLD for the capital of a country (e.g., .cairo) you will have to get the permission of the national government.
• Use of zone files (Section 2.2.3.3). If you want to do a TLD that makes innovative use of the DNS (as .TEL did), you will now have to ask for special permission from ICANN, who will check to make sure that your plan won’t harm the stability of the DNS system.
• Incorporation of IRT recommendations (e.g., Section 5.4.1). Parts of the recommendations of the Implementation Recommendation Team (IRT) have been incorporated into the DAG, including the Uniform Rapid Suspension requirement.

Overall, this version of the Draft Applicant Guidebook differs from the previous version by adding some incremental changes and extra back doors for fidgety governments and the IP interests who lobby them. None of the changes are unexpected or especially egregious. We are satisfied with the new document, and hope and expect that ICANN will move expeditiously to issue a final guidebook with application dates and final rules.