Blog: GAC

The COI + the EBERO: A Recipe to Create Failed Registries

ICANN’s current plan for a Continued Operations Instrument (COI) is a self-insurance scheme that asks registries to tie up a massive amount of cash, when much cheaper and more sensible options are available. The COI is a massive barrier to entry for all applicants, and one that hits smaller registries and those from developing countries with disproportionate weight. The COI requires massive amounts of cash to be set aside in case of business failure. It is so punitive that it will certainly encourage falsely conservative sales volume estimates by applicants, and likely to lead to higher prices for registrants. Combined with the Emergency Backend Registry Operator (EBERO) RFI, it will rob developing registries of much-needed funding during their critical first few years, and use the funds from the resulting failures to reward large incumbent registries. This is not a conspiracy theory — several incumbent registries, notably Afilias, also recognize this plan as dumb and have been working actively to make it more sensible: all boats float on a rising tide, and sink together too.

While registrants do need to be protected against registry failure, the ICANN formula for the COI seems much better calculated to cause registry failures than to prevent them.

The requirements for the COI are given in Question 50 of the Application Guidebook. Basically, the applicant has to set aside funds (or get a letter of credit) to assure “core registry functions” for 3 years. Core registry functions are: access to the shared registry system; Whois, DNS resolution; data escrow; and DNSSEC. That sounds reasonable enough until you start to get into the details — and the difference between what this would actually cost and what ICANN wants set aside.

At a recent session at the ICANN Dakar meeting dedicated to the COI, no-one spoke in favor of the current COI requirement. A registry stakeholder group proposal that would pool the risk was shot down by intellectual property interests, who predictably were not in favor of a mandatory payment to protect others (large companies will have no problem coming up with the COI). Others insisted that the pool was a form of insurance, and ICANN should not be in the insurance business. But some preliminary ideas toward the solution proposed in this post did receive some support. The way forward is provide estimates of actual likely costs, instead of the “sky is falling” scenario that the current plan envisages. Several groups are working to gather such data to present to ICANN. This post critiques the current system and provides an outline for a way forward.

Delay Is Not an Option

A short but important point: changing the amount of the COI does not mean a delay: it is not a change in policy, it is only a method for more reasonably estimating cost. The EBERO RFI, as the name implies, is a request for information. This too can be modified within the parameters of existing policy. Everyone involved in trying to reform this crazy mechanism has spoken out against any delays.

The Amount of the COI Is Directly Tied to the EBERO

Quoth the Guidebook:

The Continuing Operations Instrument (COI) is invoked by ICANN if necessary to pay for an Emergency Back End Registry Operator (EBERO) to maintain the five critical registry functions for a period of three to five years. Thus, the cost estimates are tied to the cost for a third party to provide the functions, not to the applicant’s actual in-house or subcontracting costs for provision of these functions.

Note that ICANN is building a model for these costs in conjunction with potential EBERO service providers. Thus, guidelines for determining the appropriate amount for the COI will be available to the applicant. However, the applicant will still be required to provide its own estimates and explanation in response to this question.

That’s what the Guidebook says, but that’s not what the EBERO RFI says. The EBERO is filled with extraneous requirements that have nothing to do with core registry functions, with the result that only large incumbent registries can qualify.

What Are the Real Costs of Transitioning a Failed Registry?

A registry stakeholder group presentation estimates that the current system would require a registry with 100,000 names in Year 3 to set aside $450,000, and a registry with 1,000,000 names in Year 3 to set aside $4,500,000. Will this kill any growing business? Is this more than most registries’ estimated profit margin? Is this completely crazy? Yes, yes, and yes.

You would think that ICANN would have done some research into the real costs of providing these five core functions to a failed registry. Maybe they did, but it doesn’t show. Let’s look at what it will actually cost. There are a few answers:

• The first and most likely answer is “almost nothing,” because the registry service provider of a failing registry can easily be persuaded to continue these operations (M+M guarantees it for their clients). That’s because in their assessment the risk is low (or they wouldn’t work with the registry in the first place) and because their incremental cost to do so is in fact near zero.
• A second answer is also “almost nothing,” because even supposing the registry operator *in addition to the registry* were to fail (a very low likelihood), in most cases any other registry service provider would be happy to pick up the names, since their incremental costs to run additional names are also near zero (there are transition costs, but these are not great — M+M transitioned a sizable zone over a weekend).
• A third answer is the ICANN way: multiply the estimated volume registrations by a dollar amount to be determined by the results of the EBERO RFI — which is only open to the most expensive incumbent registries, who charge orders of magnitude more than smaller, perhaps more efficient registries. (As one example among many, VeriSign charges $7 per name per year for .com names; Minds + Machines and many of its competitors charge less than $2 at a fraction of the volume of .com — and per-unit costs generally fall with increased scale).

Fortunately, there are plenty of examples of transition costs drawn from both the ccTLD and gTLD world that provide actual costs, and there is an effort to gather up these examples and provide them to ICANN, to give them cover (sigh) to do something sensible.

Accrediting Registry Service Providers

ICANN doesn’t like Answers 1 and 2, because (they say) “How do we know that the new registry service provider can do the job?”

Actually, the question should be reframed, “Why don’t you know?” because frankly they should know already. ICANN’s reluctance to accredit registry service providers is the greatest source of unnecessary cost and delay in the post-application period.

Without a doubt the biggest inefficiency of ICANN’s new gTLD process is the silly requirement of answering the entire tech section for each and every application. There are only a few registry service providers — Minds + Machines is one of perhaps ten — and nearly every application will use one of them. Although it’s theoretically possible to file an application for a system that’s not yet built, the level of detail required by the application effectively requires an existing, working registry. And yet for each new gTLD application, the tech section, the bulk of the application, will be reviewed anew in its entirety. So if there are 1000 applications, the evaluation of the tech section will be duplicated effort for 990 of them. I defy anyone to defend this as sensible.

Why did ICANN not simply accredit registry service providers, so that applications using accredited providers would not need to be tested and retested. Given that the application fee is based on cost recovery, an accreditation process would surely have reduced the $185,000 to something more manageable. Now that this opportunity has passed, accrediting registry providers for the five core registry functions is surely possible.

Happily, the fix is within reach and will not require further policy development or delay, if only ICANN comes to its senses. One obvious solution lies in amending the current EBERO RFI. In fact, amending the EBERO RFI could result in huge cost and time savings across the board.

The EBERO: Gold Mine for Incumbent Registries, Paid for by Applicants

The EBERO as written could be retitled the “Incumbent Registry Free Money RFI.” It is in fact a registry service provider accreditation program, but only for the chosen few. It is written to exclude any provider who is not a high-volume incumbent, assumes a .com-like one-size-fits-all model, and includes pages of requirements that have nothing to do with providing “core registry services,” even though Question 50 of the Guidebook links the two explicitly. In fact, the EBERO is filled with requirements that aren’t required of applicants in the Guidebook. Why are they required here?

Here are some examples of overreaching EBERO requirements (picked from among many such entries):

• High Capacity traffic service capability
• Ability to handle up to 20,000 concurrent client connections and a daily minimum peak volume of 2 million transactions with a read/write ratio of 10/1 (based on an estimated 1 million aggregate domains in the EBERO).
• Provide examples of thought leadership, industry participation, and publications that highlight your experience ["Thought leadership" as a technical requirement? - puh-leeze!]
• Ability to support and maintain IDN registrations
• Multiple DNS service locations that are geographically diverse and can be demonstrated to fully serve global resolutions
• Ability to accept live call volumes from an estimated user base of 300 and an expected contact rate of 15-20% during emergency migration periods without queuing times exceeding 10 minutes

The list goes on, one gold-plated requirement after another. The problems with this approach are manifold, but they all stem from the idea that one registry service provider should be able to handle *any and all* failing registries. That’s just plain silly — why not accredit a diversity of registry service providers as EBERO candidates and then assign failing registries to them according to the requirements of the registry?

Why the EBERO Doesn’t Make Sense As Written

The EBERO doesn’t pass the sniff test:

• Even though the most likely scenario for registry failure is an inability to sell as many names as estimated, resulting in a registry with few names, the EBERO calls for high-volume experience only. If anything, they should be looking for low-volume experience.
• If the failing registry doesn’t sell IDNs, why should the EBERO support them?
• If the failing registry only has 3 registrars, why should the EBERO support 300 concurrently?
• Data escrow, one of the five core registry services, is by definition outsourced. DNS is not outsourced necessarily, but in many cases it makes good sense both financially and technically (for redundancy) to do so. Why does the EBERO need to provide DNS services? ICANN could easily ask for EDNS (Emergency DNS) providers — they would line up to provide reasonably priced services.
• The EBERO as drafted assumes (unreasonably) that it will take 3 years to find a new home for the registry. Instead of providing a gold mine to large incumbent registries with little obligation, why not ask EBERO’s to provide a permanent home? In that case the funding wouldn’t need to cover three years — more like three weeks at the outside.
• Why should billing be suspended during the emergency period? If functions are being provided as normal, why not accept renewals at least, if not new registrations? This would substantially reduce the amount needed in the COI.

The EBERO as written is perfect for the fool who gives away millions of .BLAH registrations and then finds that no-one wants to renew them for money. For everything else, it’s overkill, and tying the COI for all registries to the cost of rescuing .BLAH is unreasoningly punitive. ICANN is asking all applicants to tie up precious cash reserves to cover for ICANN’s poor planning in this regard, and the result will be that new registries will find it hard to market their new TLDs in the critical first years of their registries — leading, inevitably, to registry failures.

Fix the EBERO, and the COI Suddenly Becomes Reasonable

ICANN should ditch the one-size-fits-all EBERO specification, and change it to accept a diversity of models, and rate registry service providers for volume of names, IDN capabilities, and some other criteria. Most of all, they should be rated on their ability to provide the required core registry services, and not on the number of gold-plated toilet seats they have. Once rated, these providers would be accredited for the capabilities they provide. Will this take a while? Maybe, but no new registry will be online for over a year. ICANN should also ask for Emergency DNS providers, since DNS can be easily provided independently of the Shared Registration System. DNS prices in the open market range from free to expensive — again, one size does not fit all. Overall, the prices for emergency services would drop drastically, and the effect would be to re-price the COI at a reasonable amount.

In a free market, registry service providers would be lining up to provide transition services for free if they were allowed to collect renewal fees for a certain period of time. Why is this not allowed in the EBERO? Only in extreme cases would there be no takers, and only then should a larger payment be invoked. The EBERO as written is a gift to large incumbent registries to pick up distressed registries (probably permanently, because why should they move again?), leaving aspiring applicants to pay for their gain via the COI.

There is a better way, and if ICANN (and, ahem, the GAC) actually gave a thought about the real-world issues faced by small registries or those from developing countries, they would insist on tying the COI to a real-world cost, and they would resist give-aways to incumbents through a guaranteed-income scheme paid for by struggling newbies. The COI and EBERO severely reduce choice and competition, and the security they promise is illusory and unsupported by experience or fact. They need to be changed, and the way to do it is to widen the field of emergency providers and thereby reduce the cost of the COI.

In his eloquent dissent against approving .XXX, ICANN Board member George Sadowsky talked about blocking and filtering top-level domains. It’s a concise statement of a concern that has been identified by various people, including members of the GAC, as an impediment to the new gTLD program. It’s a thorough defense of a common point of view about blocking TLDs, but while no-one can disagree about the fact of blocking, what is the actual effect?

George Sadowsky’s comment is worth quoting at some length:

Fourth, and extremely important, I believe that the future of the unified DNS could be at stake [if .xxx were approved].

I submit that the approval of the application for dot xxx could encourage moves to break the cohesiveness and uniqueness of the DNS.

In my judgment, it would undoubtedly lead to filtering the domain, and quite possibly instigate the erosion, degradation, and eventual fragmentation of the unique DNS root.

Now, while we know that filtering already exists, I believe that the creation of dot xxx would mark the first instance of an action by this board that may directly encourage such filtering, posing a risk to the security and stability of the DNS.

In my judgment, the board should not be taking actions that encourage filtering or blocking of a domain at the top level.

Further, I believe that the filtering of so-called offensive material can provide a convenient excuse for political regimes interested in an intent on limiting civic rights and freedom of speech.

Further, I believe that such moves provide an incitement to fracture the root, a concern that we’ve recognized in preparation for
the new gTLD program as a distinct threat to the security and stability of the DNS.

There can be no doubt that .xxx will be blocked by some countries: the government of India has already announced its intention to do so. The .xxx domain exists in order to be filtered — that’s almost the entire point of it. It is premised on segregating content into adult and non-adult categories, so that people can find it easily — or avoid it. So no-one could disagree with George’s assessment of the likelihood of .xxx leading to filtering.

Widespread Blocking of the Internet Exists Today

As George Sadowsky points out, filtering and blocking already exist. Not just at the second level (individual web sites) or the top level (TLDs), but also of the entire Internet. Consider this graphic from a recent presentation by Packet Clearing House showing Internet traffic in Egypt:

This is filtering on a massive scale, done by a regime that didn’t want its citizenry to have any information that conflicted with its message.

Meanwhile, Hillary Clinton presented the U.S. State Department’s annual report on human rights, running to 7,000 pages. The Associated Press writes:

More than 40 governments are now blocking their citizens’ access to the Internet, and the firewalls, regulatory restrictions and technologies are all “designed to repress speech and infringe on the personal privacy of those who use these rapidly evolving technologies.”

Second-level domain names are blocked almost as a matter of course in large parts of the world. The most-blocked site is Facebook, followed by YouTube, Twitter, and a host of other sites that are hugely popular — some of them porn, but many of them not.

Basically, the governments of the world engage in blocking and filtering on a massive scale. They are blocking second-level as well as top-level names, and sometimes they just block the entire Internet. They block based on content: porn, political statements across the ideological spectrum, religious speech of all kinds, and they also block just on the basis that they don’t want people sharing information. This kind of governmental action is not new. Monopoly of information has long been a goal of many governments: until recently, one of the major goals of a coup or a revolution was to capture the TV and radio stations.

Will TLD Blocking Fracture the Internet?

Blocking of Internet content is pervasive, and the creation of new TLDs which are offensive to someone, somewhere, will probably increase it. But will it fracture the Internet? That’s where I think George’s fears may be out of place. The current blocking is so widespread, so thorough, and so invisible to those who don’t have to deal with it that it’s just part of life in much of the world. Why hasn’t blocking already encouraged a fracture?

For one thing, an alternate root by itself is not a fracture. There are already many TLDs on alternate roots out there, from Karl Auerbach’s .ewe to the semi-autonomous Chinese-language TLDs. The threat to the single root doesn’t come from just the fact of setting it up, it comes in the form of a viable alternative that threatens the current Internet by gaining users and adoption at the expense of the current favorite (think MySpace and Facebook). Karl’s .ewe is not getting a lot of takers, and in China you don’t really have a lot of choice — no-one is “choosing” any of the alternatives. (The only alternative use, in this sense, has come from new TLDs/roots in non-Latin scripts, and ICANN’s push to delegate new IDN ccTLDs has done a lot to alleviate that pressure.) So blocking .XXX (or any other new TLD), as long as it doesn’t threaten to create a competing root, is just more of the same old blinkering of its citizens that governments are addicted to and will never stop unless their people insist on it.

Let’s suppose, however, that it was possible for a mandatory alternate root to be set up, enforced by governmental authority. In a state with just a few major ISPs, the government might compel them to point to the new, alternative, government-mandated root. Isn’t that a problem? (Note that this is not currently the case in China, which allows access to the Internet, just not to many of its sites.)

To examine that possibility, let’s turn to television, where this situation is common. In Iran, for instance, there is a limited roster of TV stations and they are all closely censored. What happens there?

One of the biggest hits on Iranian TV is not on Iranian TV. A kind of Persian “Daily Show” called Parazit is broadcast by the Voice of America. Parazit is watched by millions of Iranians through their illegal satellite dishes, which are extremely common in Iran, despite periodic attempts by the morals police to get rid of them (satellite dishes can also be used to access the Internet). Parazit is a hit — it gets 45,000 You Tube visits a week, and 17 million Facebook visits per month.

The net effect of Iran’s censorship is to make its leaders laughable and hated, but it has not threatened the Iranian TV “root,” which goes on broadcasting propaganda. It has not led to a call for an alternate state television either — people simply bypass the restrictions and access the rest of the world.

In the world today, Internet blocking and filtering of all kinds is widespread and deep, and it has not threatened the single root. Censorship is a favorite habit of some governments, and they are not weaned from it easily. Limiting “controversial” TLDs in order to appease that impulse, in the name of preserving a single root, is illusory (alternate roots already exist), not likely to matter (people will get out to the “real” Internet somehow), and it doesn’t really make sense.

As Milton Mueller put it: “The idea that it is somehow better for the Internet to use centralized, global administrative mechanisms to block domains from existing in order to prevent a few individual countries from using technical means to block them locally is absurd and dangerous.” Or, to quote another ICANN Board member, Suzanne Woolf: “The issue of governments or any other entity blocking or filtering access to a specific TLD is not unique to the issue of the dot xxx sTLD. What we agree is blocking of TLDs is generally undesirable. If some blocking of the XXX sTLD does occur, there is no evidence the result will be different than the blocking that already occurs.”

George Sadowsky is a principled person who clearly loves the Internet and wants to preserve it. He gives a clear voice to a fear that many have. But when we look at what blocking actually is, and what it does, I think the fears are unfounded. People will find a way to see what they want to see, and ignore stuff that they don’t like. Blocking of a TLD by a local government is not going to lead to the fracturing of the Internet. If the case of Egypt is any guide, it’s more likely to lead to the fracturing of the local government.

Some bad ideas at ICANN crop up again and again, stubborn and persistent like a case of herpes. These ideas seem innocent at first, but after they take root they turn out to be difficult to control and are guaranteed to scare people away. Even after treatment, they re-appear with unnerving regularity.

Such is the idea of categorizing and segregating and prioritizing new top-level domain names. In 2001, we had the Board picking names (category: “We like them!”); in 2005, sponsored TLDs (category: “They’re safer!”); now in the current round we have communities (category: “They’re worthy!”) and geographical names (category: “Government property!!”). If some people have their way, we’ll soon be adding any number of other gradations of purity to the selection criteria (category: “Priority for strings I approve of!”). These last are the supposedly “uncontroversial” strings — except that nothing about categories is uncontroversial when you get down to the details, as we shall see.

Over the last ten years, the ICANN mania for categorization has prompted an enormous collective yawn from Internet users, as they issue one boring TLD after another. (The one interesting TLD, .xxx, was introduced only after ICM Registry, the proposer, spent millions of dollars to force ICANN to approve it.) Even the biggest winner among these “picked for success” TLDs, .info, was at one point was reduced to giving away domain names to try to stimulate usage. People have said that some of these TLDs are successful according to their own lights, and perhaps they are, but let’s be serious — every other Internet initiative is judged successful or not according to adoption and usage, and in this sense TLDs in the “chosen” category are failures. The extensive history of the use of categories in domain names — at both the top level and the second level — has shown that they have one overwhelming effect, which is to limit interest and use.

History of a Bad Idea

The idea of TLD categories has been around since before ICANN. One of its more extreme manifestations comes in a 1996 proposal from Simon Higgs, in which he says:

This document covers… the framework necessary to define the function, delegation, and use of new top level domains. Several factors need to be addressed such as why the TLD exists in the first place, who accepts registrations for the TLD, and what special purpose (if any) the TLD serves. These questions can be answered by the recognition of TLD “classes”.

Sounds sensible and innocuous, right? Yes, until you get to the conclusion — that all TLDs should be shoe-horned into 45 categories, including such doozies as:

• .ARTIF – for artificial limbs, eyes, and teeth
• .DERM – for leather goods (and Valtrex?)
• .CUL – for culture (works particularly well in French)
• .ITAR – for guns and ammo, I kid you not
• .WEAR – for clothing

… etc.

Chanel, under this scheme, would be required to register its name as chanel.wear, and Coach to sell its leather luggage under the super-sexy name coach.derm. This is a vision of the Internet, the most powerful commerce engine ever devised, crippled and turned into a branding nightmare. This is a vision of the Internet, the most powerful means of finding information ever invented, categorized into a reductionist caricature of trademark law. (In fairness to Mr. Higgs, the list of names was presented as a draft, with room for improvement. But still….)

We can wonder at this logical but hare-brained scheme from 1996, but domain classification schemes are still in force today, with depressing results. From the Higgs proposal to the seven TLDs proposed by the IAHC, from the “beauty contest” of the initial ICANN round to the “proof of concept” sponsored TLD round, not one categorized TLD has achieved anything resembling widespread approval or adoption. Contrast and compare to the market-driven launches of .RF (Cyrillic) and .CO, which have been instant successes.

What the Research Says

So what does drive adoption of a new TLD? Dr. Matthew Zook of the University of Kentucky was commissioned by APTLD to do a study of the factors that lead to acceptance and adoption of top-level domains, in this case ccTLDs. He identified three essential factors: population size (in other words, the addressable market), income level, and finally registration policies, which turn out to be a key factor. TLDs that restricted delegations based on categories of applicants, for instance allowing only businesses to register, or requiring applicants to submit proof of identity, were found to be very poorly received — not least because each restriction meant instituting a time-consuming and frustrating bureaucracy to verify an applicant’s eligibility. Going beyond Zook’s study, we can also observe some restricted TLDs, for instance .FR and .SE, abandoning their rules and seeing adoption rates go up substantially.

Administrators of some ccTLDs early on put into place categories and distinctions whose effects still ripple through the domain name industry today, resulting in inefficiencies and costs for registrants. I know this well: I built and sold two successful businesses, NetNames USA and NameEngine, that were devoted to helping corporations figure out how to register names in different ccTLDs, and how to “comply” with various restrictions on eligibility. For instance, if the rules required that a registrant needed to have an in-country contact, we would supply one. The net effect of the TLD categories and restrictions was to increase costs to applicants, thereby ensuring that those with resources got what they wanted, while the poor were hampered by the rules. Today, Mark Monitor and others continue to run successful businesses that help corporations decipher and exploit the arcana of domain name eligibility policies.

Categories = Restricted Access

“But,” (some will say) “this is not the fault of categories, but of the restrictions themselves.” That’s a false distinction. The fact is that there never was a domain name category that was not used to restrict access or eligibility in some way. Restrictions are the other face of categories, they are inseparable. Eligibility restrictions are the whole point of categories. And restrictions lead to cost, delays and depressed levels of adoption.

No Such Thing As a Simple Category

Categories are chimerical. They appear simple, commonsensical, real, but has there ever been a category as simple as it seems? One category that ICANN has allowed, in a nod to governments, is that of geographical names. This grouping, which seems uncontroversial — what could be easier than place names? — has proven to be fraught with intractable nuance. What, for instance, is a city? The GAC member from Greece said at the ICANN meeting in San Francisco that a “city” was any place on earth where more than one person had settled. Absurd as that may seem, in a testy twenty-minute exchange on the subject between the ICANN Board and the GAC, that’s as close as anyone got to a definition.

As well as having calamitous practical effects, categories are inherently unfair because they are impossible to define. This always leads to a subjective judgment of who is in, and who is out.

The Guardians of Rectitude

Dividing up applicants or strings into groups sounds easy and simple, but when you get down to the details categories are difficult to define, devilish to administer, and unfair and expensive to applicants. If you’ve worked at a registry or registrar, you know this.

If you haven’t, you may nonetheless notice the unpleasant whiff of grinch emanating from certain quarters of ICANN. The very idea that people could have any domain name they want, just because they want it, is intolerable to the misanthropes who would like to exercise permanent micro-regulation over new gTLD registrations. Categories are their weapon, because with categories come boundaries, and with boundaries come infractions, and with infractions come punishments, and for punishments you must have judges — and here they come, the merry judge-volunteers, ready to rain red tape on unwitting registrants and registries. “How dare you want allow a flip-flop company to register a .shoe domain? Everyone knows that flip-flops are not real shoes! The registration must be revoked!”

Abstinence Is a Virtue

Categories in the domain name world have proven to be pernicious. The registration requirements they engender depress demand, introduce costs and bureaucracies and delays, and because those with money and persistence will always find a way around the rules, they exacerbate inequalities of access. Add to this the near impossibility of coming up with a category that can be defined with any precision. The same dynamic that has turned some ccTLDs into ghost towns will take hold in the new gTLD program if new categories are introduced into the process.

The ICANN Board and staff are reluctant to expand TLD categories. That is very wise; seductive as they are, domain name categories are a disease with symptoms that are painful, embarrassing, and difficult to manage. And also gross and itchy.

There are plenty of things about ICANN’s Government Advisory Committee (GAC) to annoy most people at ICANN. I suspect they must at times be maddening even to some GAC members themselves. After years of lobbying to get the GAC to open more of their meetings to the public, I have often wished they’d close them again.

Here are just a few things that make me want to slit my wrists at GAC meetings:

• Members who don’t know anything about the issues in front of them
• Members who literally read talking points from people who have lobbied them (trademark interests, almost exclusively)
• Members who believe their job is to control the Internet, and delude themselves that they have the power to do so
• Endless speeches leading nowhere

I used to fume about it, until I realized two things:

• All these annoyances exist in every other ICANN forum as well
• It could be much much much worse

Recently, a very good article on Circle ID by Gregory Francis, along with a follow-up by Kevin Murphy on DomainIncite, show how those of us who have been tearing clumps of hair out of our scalps at the slow pace of ICANN as compared to the “real” Internet might instead be grateful that we’re not dealing with the International Telecommunications Union (ITU).

The ITU co-ordinates all the world’s telephone systems — and we all know how well and inexpensively these are run. No-one is allowed to go to ITU meetings except governments and a few other “international fora” — basically, U.N. agencies (a recent request from ICANN to attend was turned down). At the ITU, each government has monopoly power over its nation’s phone system, and phone calls are routed internationally according to a series of cross-country agreements.

That’s how they want the Internet to work as well. Want to send an email to your friend in Greece? Sure, but it will cost you, because of a bilateral agreement between countries where you, the customer, pay the bill but have no input into how or why you are paying so much.

Now, at the ITU plenipotentiary in Mexico, the Russian delegates are saying that the ITU should be able to veto anything that the ICANN Board of Directors decides.

Consideration should be given to the expediency of having the functions of GAC carried out by a specially-constituted group within ITU with the authority to veto decisions adopted by the ICANN Board of Directors.

I suppose we should be grateful to the Russians for laying bare their goals; it is one advantage of a censored regime that the leaders become tone-deaf and don’t appreciate how ridiculous their pronouncements sound to the masses.

But we should also be grateful for the GAC. For all the stony-faced members who say nothing and then vote according to who was lobbying their bosses, there are many GAC members who care about the issues and are doing their best to communicate with the rest of the ICANN community. I rarely agree with them, but at least I can speak to them.

Sometimes the GAC seem to place themselves above ICANN, seem to think little of wielding their wrecking ball on what the rest of ICANN has built up, and indeed sometimes act as if they have veto power over the ICANN Board. But in fact they don’t, and the relationship between the GAC and the rest of ICANN is considerably more nuanced.

The ITU is a powerful group that is very jealous of ICANN. They believe very strongly that they should be running the Internet. The reason they’re not running it now is because there are a few nations within the ITU who value the Internet and put a stop to such efforts. Often, they’re the same governments that participate on the GAC.

So, yes, the GAC can be obstructionist and arrogant. But whenever the ITU gets together I get to where I just love the GAC. And so should you.

ICANN’s 38th get-together, in Brussels, may become known as the meeting where the dust finally began to settle. Long-standing issues were settled, compromises were reached, no-one complained too much about the latest version of the Applicant Guidebook, and the Board stood by its project plan dates, even scheduling a Board retreat to solve remaining issues. Finally, there were no surprise “gotcha!” delays that gTLD applicants have been used to seeing at ICANN meeting. With one possible exception…

September Board Retreat – Good News

ICANN’s Board of Directors is going to take a special retreat, tentatively scheduled for September 2010, to try to sort out the remaining gTLD issues. This was publicly announced by Chairman Peter Dengate-Thrush and much discussed during the Brussels meeting. It is likely that the Board will hammer out some solutions on issues where opposing camps are insisting on their advantages and refusing to compromise.

The Board seems to be taking their task seriously, putting enormous pressure on various working groups (see my notes on the vertical integration working group, below) to produce proposals prior to their retreat. Applicants should be pleased with the vigor with which the Board has decided to address the remaining logjams.

.XXX Decision – Good News

The Board’s decision to green-light .XXX means new gTLD applicants can breathe a sigh of relief. The approval means that the new gTLDs program will not be threatened by .XXX-inspired court interference in the gTLD process. ICM Registry, .XXX’s sponsor, would almost certainly have sued ICANN if the decision had gone differently, and very likely they would have asked for an injunction to stop the introduction of new gTLDs — and they might have been successful. The ICANN Board decision to go ahead with .XXX, however heavily hedged with caveats, removes this threat. That’s good news for gTLD applicants.

Most of the press I’ve seen makes it seem as if .XXX is a done deal, and will be inserted into the root in short order. Unfortunately for the 162,000 reported pre-registration applications for .XXX, we are very far from that. One of the more intelligent analyses of the Board’s resolution is theTom Hymes story at AVN. To their credit, ICM’s blog has a thorough and fact-filled rundown of the remaining obstacles. My own assessment of .XXX isn’t very positive, but it is a good sign that ICANN is letting itself be compelled to following its own rules.

Intellectual Property Issues – Good News

Trademark advocates at ICANN will tell you that they are the reasonable ones, that the people who are unalterably opposed to new gTLDs don’t even show up at ICANN meetings. That may be, but members of ICANN’s intellectual property constituency have hardly been pushovers. Therefore it was a pleasure to witness hardline opponents to new gTLDs, including sharp critics from the BBC, Nestle, and the American Red Cross talk constructively about how they could benefit from them at a panel called “Brand Management in the Age of New gTLDs.”

For instance, Charlotte Walters of Orange (the phone company) had this to say:

I think we’re all about building and driving brand value, in which case if you have an asset that could become a mark of value and a mark of quality so that consumers would come to recognize that something that is dot Orange is genuine and that there is no risk of phishing or any other malicious acts underneath it, then that would be the ideal position that we are all aiming to get to. The question is, how long does it take you to get there.

In the meantime, I think that defensive registrations, which we’re all used to doing, is going to be an ongoing factor….

So on a longer-term view, yes, it — there is a lot of potential value. And from a marketing perspective, there’s a lot of potential value. But it will take a long time, I think, to educate internally and externally as to how to get there.

The intellectual property people fought hard for their position and achieved enormous gains, and now there is a sense that they should take their winnings quietly, which they seem to be doing. There are now several RPMs (rights protection mechanisms) in the Applicant Guidebook, including measures to shut down entire registries if they were found to be knowingly and systematically violating IP rights. The GAC (Government Advisory Committee) is no longer worrying that the sky will fall without more IP protections, and the Board opines quite openly that they see consensus in this area. Strident denunciations will continue, but at the meeting there was overwhelming agreement that we are finally past this hurdle.

Vertical Integration – Good News

The good news — and it is good news — is that the Vertical Integration Policy Development Process (VI PDP) is not going to delay new gTLDs. That doesn’t mean the results won’t affect new gTLDs, but it’s not going to slow things down.

Vertical Integration is another way of saying cross-ownership or control, and in this case the question is whether (and to what extent) a registry can own or control a registrar, or vice-versa. The Working Group (which I participate in) has a wide variety of entrenched positions, ranging from protectionist limitations on cross-ownership to a registrar-pleasing complete lack of barriers. The arguments are arcane, and because the limitations concern a future marketplace that no-one can really grasp, the proceedings are an anxious pandemonium of fears and doubts. But the Board has insisted on getting some kind of report in time for its retreat, and so the Working Group is likely to produce a very thin document that representing whatever consensus the group can achieve. The Board doesn’t want to decide this question on its own, but if it must, it will.

You can access the Working Group’s online resource page, or for a long slog you can read the Working Group’s email archives. A few weeks ago, I took the trouble to articulate the Minds + Machines position, which remains the same.

MOPO – Theoretical Knot with a Real-World Solution

MOPO, also called MAPO, stands for “Morality and Public Order,” which is the last big sticking point. Most did not consider it that big of an issue until this Brussels meeting, when the GAC first declared that ICANN’s whole approach to ferreting out immorality (having jurists decide if a TLD is immoral) was not acceptable and must be changed. They subsequently declared it was not their job to suggest anything in its place. Predictably, ICANN board members and staffers were annoyed, but must realize that ultimately they have to produce something that the GAC can live with. Watching the meetings, I didn’t sense that the GAC was using this as an issue to slow down new gTLDs; on the contrary, they seemed not to want to be seen as the reason for delay.

On the one hand, the GAC is right: the morality and public order module is a mess, bulked up with portentous phrases but basically passing the buck to some highly paid lawyers. On the other hand, the module fails precisely because it’s impossible to determine what’s immoral or not on a global basis — this is a circle that will not be squared. The debate is reminiscent of the struggles of the U.S. courts to define pornography, and the solution that was reached — local community standards — will serve here too.

A practical fix is needed, even if it doesn’t address the underlying (insoluble) problem. My guess is that, despite its overtones of censorship, ICANN will have to set up some kind of morality panel in judgment of names, and people it with diverse enough stakeholders to deflect claims of conspiracy. And the vast majority of TLDs will pass without a whisper of dissent. This panel will be just another objection chokepoint, joining the Independent Objector, the Geographic Names Panel, Community Objection and other procedures as a gateway that gTLD applications will have to pass through. Meanwhile, out in the real world, local jurisdictions may block some gTLDs locally if they find them offensive — just as they now block certain second-level domain names in .com.

Although MOPO is the most concerning of the remaining obstacles to opening the new gTLD process, and does have a chance of slowing down the process, there are a lot of committed people working on a solution. The real difficulty will be to shoehorn the practical solution into a theoretical framework that’s consistent with the principles everyone is keen to display.

The Bottom Line

The final shape of the applicant guidebook is becoming clear. With the possible exception of the MOPO issue, solutions to the remaining problems are visible in outline and in many cases in great detail. There are several efforts underway, including the Board retreat and various hurry-up working groups, to get the new gTLD program to the finish line. There’s always a chance that the timing will slip, but I would say not by much — we’re sticking to our timeline: most indications are that ICANN’s next meeting, in early December 2010 in Cartagena, Colombia, will finally produce a starting date for new gTLDs.

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.

Yesterday, at the .ORG Forum, ICANN CEO Rod Beckstrom said,

There’s a clash of models going on in the world. It’s a clash of this decentralized multi-stakerholder model versus traditional government top-down model or centralized models. And this model we’re working on is different, it’s a mix. Governments are stakeholders, but they’re not the only stakeholders. They’re participants, but they’re not dominant. And trying to maintain that balance is one of the great challenges all of us face, particularly when there are those who would that seek to control things. And the question we should always be asking is ‘What’s best for the public?’

And at the ICANN Studienkreis last week in Barcelona, I asked a panel that included Fiona Alexander from the U.S. NTIA how the Government Advisory Committee (GAC) saw its responsibilities to listen to the ICANN community now that the GAC has an effective veto on ICANN policy. Ms. Alexander told me that I was entirely mistaken to think that the GAC had a veto.

Officially, then, governments are just one group of many that participate at ICANN. If so, ICANN and the GAC need to get the word out, because the rest of the domain name world is treating a letter from GAC head Janis Karklins as if it were the thunderous voice of God.

This letter, which warned the ICANN Board not to consider the Expressions of Interest proposal until the ICANN meeting in Nairobi, has been greeted with such headlines as Governments Deliver Another Blow to New Top Level Domain Timeline, and privately ICANN Board members have told us that it’s now “impossible” to support Expressions of Interest prior to the Nairobi meeting for fear of annoying the GAC.

In contrast, the unanimous vote of the At Large Advisory Committee (ALAC) in favor of Espressions of Interest has attracted no notice at all. The ALAC, which represents individual users of the Internet, has in in principle the same weight as any other advisory committee (such as the GAC), but apparently some equals are more equal than others.

The new Affirmation of Commitments, the “charter” for ICANN, clearly sets up an expanded role for the GAC. It is responsible (in part) for choosing the people who will conduct reviews of ICANN, and it is repeatedly mentioned in the Affirmation, while other ICANN groups are not.

The question is, does the new role of the GAC give them a veto power over ICANN? Formally, the answer is no. In practical terms, however, judging from the reaction to their “advice,” mere grumbling from the GAC can upset ICANN timelines.

It’s up to the ICANN Board and the CEO to determine where they are going to draw the lines with GAC. It’s up to the ICANN community to insist that as an important part of that community, the GAC not only injects its opinion into the debate, but listens as well. The stakes are high, because as Rod Beckstrom correctly notes:

The Internet has not been successful because one company or five companies got together and formed a cartel, and said “this is going to be the standard,” or a government said “this is going to be the standard”…. Mankind is facing global issues that have to be managed on a global basis. What we’re doing here [at ICANN] is an exciting and important new model for what can be used for addressing and solving many of these problems.

Whether the new model is “exciting,” as Mr. Beckstrom says, or depressing, as many fear, will turn in large part on determining the influence of governments within ICANN. The first indications will come from ICANN’s Board of Directors at their next meeting in February.

The letter that follows was sent to ICANN as a comment on their Expressions of Interest (EOI) process. In our view, the EOI debate has become the fulcrum of the new TLD process, and ICANN’s credibility is at stake. The letter explains why now is the time that ICANN must make its choice.

January 27, 2010

Mr. Peter Dengate Thrush,
Chairman, Board of Directors, ICANN

Dear Peter,

We have reached an inflection point in the history of ICANN. By the end of the ICANN meeting in Nairobi in March 2010, we will know if ICANN is really going to introduce new top-level domains, or if the ten years of promises of choice and competition were empty and worthless. Is ICANN able to act in the interest of Internet users, or is it doomed to inaction and a slow decline into irrelevance?

At some point, on some issue, things were going to come to a head. We have reached that point, and (as it happens) the issue that will decide ICANN’s credibility is a process called Expressions of Interest (EOI), in which applicants for new TLDs are asked to declare their interest in new applying for a new TLD, and to supply evidence of their seriousness in the form of a hefty submission fee – which, nonetheless, would be applied as a credit toward the application fee.

This EOI process seems at first a minor point, but ICANN, by its previous ambivalence and cryptic ambiguity with regard to new TLDs, has invested in the EOI process the entire credibility of the institution as a venue for Internet governance. It could have been any other question of policy or rules, but it so happens that the course of Internet history has determined that it is on this question that ICANN will be forced to declare itself.

EOIs, minor in themselves, stand for a much larger question: will ICANN proceed with new TLDs or will it not? If it approves the EOI process in some recognizable form, ICANN will have signaled that it is going ahead, that it respects the voice of the Internet community, and that a decision by the community, once reached, has meaning and is to be respected. On the other hand, if it delays making a decision or otherwise vacillates, ICANN will have just as clearly indicated that it is so beholden to incumbent interests, so susceptible to well-financed lobbying, so fearful of criticism from the powerful, that it is willing to throw decisions of the ICANN community overboard to placate those interests, and that it considers its mission not as extending the Internet to those who need it, but as hobbling it on behalf of the economic interests of incumbent insiders. If ICANN once again opts for delay, it will show the world that it is simply window-dressing, and will occupy in history a place on that crowded shelf of insincere political decoration.

At this important juncture, we should be clear: the Internet does not need ICANN, but ICANN needs the Internet. Already issues similar to those ICANN faces today are popping up in other namespaces, for instance names in Twitter, or in Facebook. There the carefully collected Internet interests that make up ICANN have no representation, no voice, no input. And yet Facebook, with an avowed commercial purpose, is seen to be more responsive to Internet users than ICANN is; it has tested a number of initiatives – concerning privacy, advertising, and more – and changed policies in response to user feedback.

ICANN’s value to the Internet has little to do with domain names, which may in the end turn out to be a passing fad; the interest in ICANN turns first and foremost on the question of whether it can be a model for fair and equitable Internet governance. In deciding the EOI question, in deciding whether it is truly going to move ahead to implement the community decision to implement new gTLDs, ICANN is choosing whether it wants to be part of the vital Internet, or a failed and naïve experiment.

The Affirmation of Commitments

At this late date in the process, after years of relying on ICANN’s shape-shifting timelines, many potential applicants – especially the smaller, not-for-profit public-interest registries whose names are so often invoked, without their consent, in calling for delay – are close to insolvency. ICANN’s inability to manage its processes is about to kill the very thing it claimed to create – choice and competition among gTLDs.

In one of those ironies that abound in any study of institutions built from idealism, these would-be registries who have followed ICANN’s vacillating instructions, commented on guidebooks, and have greeted delay after delay with disappointment but also hope, as a hungry job applicant waits for that all-important interview – these applicants have now become the whipping boy of incumbent interests, are being vilified as greedy, unconscionable speculators, and have been given a new code word: “ICANN insiders.”

The Affirmation of Commitments (“AoC”) states:

“DOC [Department of Commerce] affirms its commitment to a multi-stakeholder, private sector led, bottom-up policy development model for DNS technical coordination that acts for the benefit of global Internet users. A private coordinating process, the outcomes of which reflect the public interest, is best able to flexibly meet the changing needs of the Internet and of Internet users. ICANN and DOC recognize that there is a group of participants that engage in ICANN’s processes to a greater extent than Internet users generally. To ensure that its decisions are in the public interest, and not just the interests of a particular set of stakeholders, ICANN commits to perform and publish analyses of the positive and negative effects of its decisions on the public, including any financial impact on the public, and the positive or negative impact (if any) on the systemic security, stability and resiliency of the DNS.”

This important statement deserves some analysis. Note first of all that ICANN is to be “private sector led” and should enjoy a “bottom-up policy development model.” This statement reserves the initiation of policy to the private sector, and reserves to the community the responsibility of developing policy. Non-private-sector actors are given a role of comment and oversight.

Note furthermore that ICANN is committed to publishing analyses of its bottom-up, private-sector led decisions. In other words, it is committed to explaining its decisions in a transparent way. This is quite different from a commitment to submit its tentative decisions to one or more non-community groups for approval before moving ahead. The clear intent is for ICANN to make decisions first (after community input), then provide justification for them. A review prior to a decision would be impossible, because it would plainly mean that a decision had not yet been reached.

Finally, the AoC explicitly refers to the danger of capture by noting that “there is a group of participants that engage in ICANN’s processes to a greater extent than Internet users generally.”

With breathtaking disregard for the facts, those who would stop EOIs have identified this “group of participants” as the applicants themselves! This unsupported pretzel of untruth has unfortunately been picked up in a recent communication by the Board from the Government Advisory Committee (“GAC”).

Let’s look at that letter, its assumptions, and who the real insiders are.

The Real Insiders

At the end of a long comment period, leaving little time for discussion or reaction, the GAC has sent a letter to the ICANN Board. In addition to noting that certain procedural punctilios had not been followed by ICANN in regard to notifying the GAC of EOI process, the GAC goes on to lay out its concerns, which neatly summarize some of the main arguments against EOIs.

The GAC asks ICANN not to vote for EOIs at its next meeting February 2010, because, the letter states, EOIs may:

• give an unfair advantage to some ICANN participants* who could pre-empt the most valuable strings before the rest of the world is fully aware of the gTLD program;
• allow a speculative market for ‘EoI application slots’; and
• penalize developing country applicants, and small non-profit TLD projects that none-the-less operate in the public interest.

*The GAC letter here quotes the AoC’s sentence recognizing that “there is a group of participants that engage in ICANN’s processes to a greater extent than Internet users generally.” The GAC clearly thinks that these participants are the applicants. The opposite is true.

Let us look at these statements. First, who are the insiders? At their Mexico City meeting in 2009, ICANN asked all those who had been to every single ICANN meeting to date to line up on stage – surely an excellent gauge of “insiderness.” Below is a photo from event.

Credit to Kim Davies. Original photo here.

Of these ultimate insiders, how many are now involved in applying for new top-level domains? We count three: Amadeu Abril i Abril, Tony Harris, and Sébastien Baccholet. They are all working on the “small non-profit TLD projects that… operate in the public interest.” These are precisely the applicants that the GAC purports to want to protect.

Ranged across the stage, in contrast, are either incumbent TLDs who stand to profit from lack of competition, or those who are counseling delay or outright abandonment of new gTLDs: Michael Palage, Marilyn Cade, Desiree Milosevic (Afilias), Chuck Gomes (VeriSign), Demi Getschko (.br), Oscar Robles Garay (.mx), Calvin Browne (.za). Whatever the actual position of the incumbents (not all are against new TLDs), their short-term economic interest is in either seeing new TLDs stopped, or delayed to such an extent that the applicants are financially exhausted by the time the application period starts.

Very conspicuously absent from the photo are any entrepreneurial faces, those who wish to start for-profit new TLDs. The unfair advantage that the GAC letter refers to goes not to enterprises who want to start new TLDs, but instead to the inside players who want to prevent new TLDs.

As far as a speculative market in new TLD “slots,” the current EOI proposal has given much thought to the matter, and has fixed on a high fee as a deterrent against buying “slots.” There may be other methods, such as a prohibition on transfers. This is not a gating issue: it’s easily solved.

Respecting Bottom-Up Policy Development and Community Decisions

The Generic Supporting Names Organization (GNSO), through a lengthy policy development process, came up with recommendations for the introduction of new gTLDs. Among the many participants in this process were members of the Intellectual Property Constituency and the Business Constituency, who generally oppose new gTLDs. Their voices, among many others, contributed to the GNSO decision. The Board and the CEO have affirmed both the legitimacy of the GNSO decision and the historic mandate of ICANN to introduce new TLDs.

This decision, and the legitimacy of the GNSO policy development process, are not in question. ICANN should therefore pay no attention to those voices who would subvert the process, such as those who counsel that the GAC or the Department of Commerce should “step in” and subvert the bottom-up consensus policy. By the same token, it should not heed those suggestions for infinite delay that will just as surely to kill new TLDs, though the death will be slower and more painful.

We recommend to the Board that in order to separate out what is legitimately a matter of community comment (registry-registrar separation for instance, or two-letter IDN TLDs) from what has already decided by the ICANN community (the fact that we are doing gTLDs), the Board should clearly identify what is a legitimate area of discussion and what is not. This would establish the primacy of the community in developing policy and remove the corrosive effects of endless second-guessing.

Protecting Incumbent Registries at the Expense of Legitimate Applicants

If the ICANN Board wants to get rid of legitimate gTLD applicants, it could follow no better course than the one it has pursued to date. Since the original DAG was published, we have seen the introduction of a host of punitive and expensive restrictions that could not have been better designed to protect the interests of the existing oligopoly of incumbent gTLD registries. These include increased fees, requirements for bonds, background checks, and so on. These and similar measures are justified in the name of security, and yet there is no empirical evidence that they would accomplish this end. What is sure, however, is that they will advantage incumbents, who are under no such obligation.

Incumbent registries are among the real ICANN insiders. From an economic perspective, short of stopping new gTLDs altogether, their advantage is to throw up barriers and to bleed new applicants, whether public-interest registries or entrepreneurial ventures. Second best to no new TLDs are an exhausted and weakened set of competitors.

In the course of human history some people, and even some companies, have risen above their narrow self-interest to embrace the greater good. It has happened. It is also rare – so rare as to excite surprise and exclamations of approval. It is therefore legitimate to examine the interest and position of incumbent registries within ICANN, so that the Board can decide if these companies and individuals are among those exceptional few.

On the Board itself sits Rita Rodin Johnston, who has represented Afilias and Global Name Registry. Also from Afilias is Ram Mohan, an Executive Vice President of Afilias. As Chair of the GNSO is Chuck Gomes, a Vice President of VeriSign. A former Board member and prime agitator against new TLDs and EOIs is Michael Palage, who is rumored to be in the employ of Afilias, a rumor which Afilias executives do not deny.* These people are smart, knowledgeable, and have contributed much to the ICANN process. They are also people with an undeniable interest.
*In a conversation with Ken Stubbs last week at the ICANN Studienkreis in Barcelona, I asked him point blank several times, with others present, if Mr. Palage was being paid by Afilias. Mr. Stubbs on each occasion declined to answer. If this widespread rumor is false, we would be glad to see it dispelled.

Even if these individuals do not recuse themselves from consideration of new gTLDs because of their entirely human propensity to protect their interests, we ask the Board and the GAC to note their positions of influence and “insiderness” when considering their statements, as they should with statements from any party.

On the other side, none of the announced gTLD applicants have any position of power within ICANN. None are on the Board. None of them hold power within ICANN’s constituent organizations. It is certainly possible that there are crypto-gTLD applicants in positions of influence – the EOI process would reveal that.

The ICANN community, the Board, and the GAC should be under no illusions about who the real insiders are.

The Legitimacy of the EOI Process

As noted in the report of the EOI Working Group, the EOI procedure flows from the GAC Principles enunciated at the ICANN meeting in Lisbon, which distinguishes the phases of application, evaluation, and delegation. The EOI is quite simply a preliminary to the application phases of the new gTLD process. EOIs are not a new policy, but an implementation feature of the community-initiated new gTLD process. Countless implementation details of the GNSO recommendation have been modified, cast aside, or eviscerated; countless other details have been added by ICANN staff, or by “inside” parties with an obvious interest in the outcome (vide the Implementation Recommendation Team’s (“IRT”) work on trademarks) without the least comment from the GAC, except for the odd note of congratulation.

We are at pains to understand how a community-inspired suggestion, worked on by a cross-functional working group representing a wide range of motivations and interests, could be seen somehow as an illegitimate policy-making initiative, while on the other hand the IRT process, in which far-reaching policy was fashioned by a closed group of “insider” representatives of trademark holders with very clear agendas, has been hailed in numerous anti-gTLD venues as a piece of valuable work.

Can ICANN Be Relevant?

On its face, the EOI process does little more than provide data to ICANN so that it can plan resources for the process of introducing new gTLDs. But it has assumed a much greater importance.

The opposition to EOIs springs from the fact that it is the first step in actually implementing the new gTLD program. It is in this character that it has assumed its lightning-rod status. Once a hundred, or five hundred, or a thousand applicants spend real money for the chance to apply for a gTLD, the ball will have started rolling, the toothpaste will be out of the tube, and the new gTLD process will have really begun. This has excited the passion of those who, while claiming to respect bottom-up policy making, strive ceaselessly to subvert the collective will of the Internet community by killing new gTLDs.

EOIs are being interpreted as a referendum on gTLDs, even though the ICANN stakeholders made their decision long ago. But those who oppose new gTLDs are ever-ready to revisit any decision that does not suit their interests.

The Board of Directors of ICANN are therefore faced, in considering what seems to be a minor implementation detail, with a momentous decision on the future of ICANN and its relevance to the Internet. They can bow before the blandishments and threats of the incumbent special interests and ICANN insiders, or they can respect the policy development process that reflects the will of the Internet community and ICANN stakeholders.

If the ICANN Board decides that its future is to become an instrument of those who put on the mantle of protectors of the community only to subvert its will, if it decides to put itself in thrall to special interests and special pleading, it will have ceased to become a relevant experiment in self-governance, and will become instead the subject of obscure academic research in some future century. By killing the EOI proposal, it will announce to the world that it has become an expert in unearthing rules and points of order designed to avoid the actions it was created to undertake. But by approving the EOI process, the Board can fulfill its historical mandate to create new gTLDs, to respect its own processes, to fulfill the clear wishes of its stakeholders, and to become a venue where real decisions are made about the Internet, by the people who use it.

We, and many others, will wait and watch, as we have done for so long. Many applicants, however, cannot afford to wait and watch much longer.

Sincerely,

Antony Van Couvering
CEO, Minds + Machines

Today, the old Joint Project Agreement (JPA) between ICANN and the Department of Commerce expired, and had its place taken by something called the Affirmation of Commitments, already being referred to as the “AoC” in the ICANN vernacular. The document is short and plainly written, so it’s worth a read and actually doesn’t need a lengthy decryption. Naturally I have some concerns, but I’ll save those for another time. This is good news and should be celebrated.

ICANN is now a global organization, in fact as well as in name. Importantly, under the AoC, ICANN remains “private sector led,” although governments, through the Governmental Advisory Committee (GAC), will have an expanded review function. That was already the case, but under the old JPA it was just one government, that of the United States, doing the reviewing.

The new framework spelled out in the Affirmation of Commitments is something ICANN has needed for a long time. It reinforces ICANN’s charter as a group that works in the public interest; it makes ICANN truly global; it gives ICANN the freedom to operate, and it sets up what we hope will be a sustainable model for government involvement. ICANN’s leadership has been given a license to do good, and we in the ICANN community should also redouble our efforts to make good on ICANN’s promise.

Congratulations to everyone at ICANN and at the Department of Commerce for reaching this historic milestone.

Tensions ran high in today’s ccNSO meeting at the ICANN meeting Mexico City when CEO Paul Twomey and Peter Dengate-Thrush announced that ICANN expects the ccTLD operators who are interested in running IDN ccTLDs to sign a contract with ICANN as a condition of approval of their IDN applications. This is a new development in the ccTLD IDN fast-track process, and took the ccTLDs by surprise.

While ccTLDs have been encouraged to sign contracts with ICANN, many have not, and the ccTLDs see this move as extortion. The Governmental Advisory Committee (GAC), composed of governments for the territories represented by ccTLDs, are not very happy about this either.