FYI, this report has just been prepared for posting at the ICA website, www.internetcommerce.org<http://www.internetcommerce.org>. Congressional ICANN Oversight Hearing Has A Bipartisan Theme - It's Too Soon To End U.S. Oversight On Thursday, June 4th the House Subcommittee on Communications, Technology and the Internet held an oversight hearing on "Issues Concerning the Internet Corporation for Assigned Names and Numbers". The hearing was remarkable in a number of ways. First, given the technically arcane nature of its subject, the turnout was spectacular - more than half the Subcommittee's members on a morning when other hearings competed for their attention, and a SRO crowd in the very large hearing room of the full Energy and Commerce Committee. Second, there was remarkable bipartisan agreement expressed, with Member sentiments falling on a continuum between extreme concern and "over our dead bodies" as regards the prospect of termination of the Joint Project Agreement (JPA) between the U.S. and ICANN on September 30th. The witnesses appearing before the Subcommittee were: * Fiona Alexander, Associate Administrator, Office of International Affairs, National Telecommunications and Information Administration, U.S. Department of Commerce * Paul Twomey, Ph.D., President and CEO, ICANN * Kenneth J. Silva, Senior Vice President and Chief Technology Officer, VeriSign * Christine N. Jones, General Counsel and Corporate Secretary, The Go Daddy Group, Inc. * Sarah Deutsch, Vice President & Associate General Counsel, Verizon Communications * Thomas M. Lenard, Ph.D., President and Senior Fellow, Technology Policy Institute All witness statements as well as streaming video are available at http://energycommerce.house.gov/index.php?option=com_content&view=article&id... . Subcommittee Chair Rick Boucher stated at the onset that the hearing would focus on whether ICANN had become sufficiently transparent and accountable to let the JPA terminate; and concerns regarding the proposed introduction of new gTLDs - including enhanced competition, brand protection, and stability and security. Other Subcommittee members used their opening statements to raise concerns about ICANN's burgeoning budget and staff; question ICANN's priorities and whether it really cared about average Internet users; express the view that full independence would threaten national and global cybersecurity; and note the possibility of potential capture by the ITU or other entities. While several Members noted that ICANN's performance has improved, the prevailing view was that JOA termination was premature and that at least short term extension, coupled with some modification of terms, was in order. Fiona Alexander performed the thankless task of delivering the Department of Commerce's views while new Assistant Secretary for Communications and Information Lawrence Strickling awaits Senate confirmation. Not only was she a stand-in but she could not indicate the Obama Administration's position on JPA extension because that is not fully developed (and even if a decision has been made, it could hardly be announced in advance of the June 8th closing of the public comment period that is supposed to inform and influence the decision). We were concerned by language in her prepared statement noting that even if the US does not extend the JPA it will still participate in ICANN's Governmental Advisory Committee (GAC) and will also be able to file comments in ICANN's public consultation processes - Mr. Strickling made a similar observation at his Senate confirmation hearing, but these are hardly reassuring words for those who are familiar with ICANN decision-making processes, and most certainly do not equate to a formal oversight role. Paul Twomey, whose departure as CEO later this year is already public knowledge, made his usual case for JPA termination to a highly skeptical Congressional audience - adding the new twist that an extension of U.S. oversight would indicate a lack of confidence in its private sector model and therefore encourage the international community to propose alternatives. None of the Subcommittee members appeared swayed by it. Most telling, perhaps, were the positions taken by ICANN's largest registry and registrar contract parties, VeriSign and GoDaddy. Ken Silva noted that "while ICANN has continued to make progress in certain areas...the basic circumstances giving rise to widespread community concerns over the expiration of the JPA remain largely unchanged and further progress is critical prior to an expiration of the agreement and end to all governmental oversight of ICANN." Christine Jones was even more blunt: "ICANN has not yet achieved competition, nor the private, bottom-up coordination and representation called for in the ICANN bylaws. The JPA between ICANN and the Department of Commerce should be extended or modified, or renewed and modified, to stress the need to correct these deficiencies and require a clear roadmap from ICANN as to how it will regain the confidence of the community on which its existence relies...Unfortunately, ICANN has yet to commit to or is unable to commit to openness, transparency and accountability." When your largest business partners take you to this type of task in front of Congress you really have major problems. The temperature in the hearing room rose by several degrees once the prepared statements were completed and questioning began. Chairman Boucher found it particularly disturbing that ICANN had never taken action against an accredited registrar engaged in cybersquatting. Ranking Republican Cliff Stearns honed in on ICANN finances, questioning whether ICANN's fees, budget and staffing were consistent with its non-profit status, as well as what ICANN would do with the more than $90 million in application fees for new gTLDs it anticipated receiving. Former full Committee Chair John Dingell resurrected the issue of the .com contract, with Christine Jones weighing in that the manner in which it was reached was "not transparent". Multiple Members questioned whether new gTLDs would truly introduce new competition and if ICANN was adequately addressing the problems they might introduce. The hearing ended with Chairman Boucher noting that the record would be kept open for thirty days and that ICANN could anticipate receiving additional written inquiries. What does all this mean for the termination or extension of the JPA? Too much should not be read into this particular episode because many Congressional hearings involve dramatic posturing and it is the Obama Administration, not Congress, which will make the ultimate call. But the strong bipartisan concern about the inconsistency of ICANN's rhetoric with the reality of its performance is hardly confined to this Subcommittee - on May 19th, Senators Olympia Snowe and Bill Nelson, both serving on the Senate Commerce Committee, sent a joint letter to Commerce Secretary Gary Locke expressing the view that "ICANN has considerable work ahead to reach the point where it can stand alone as a stable, accountable, transparent and, most importantly, secure global organization" and essentially endorsing the view that the JPA be at least temporarily extended "to allow time to design and deploy new accountability mechanisms for ICANN". Post-hearing press reports indicate that Chairman Boucher will be joining other Committee members in their own letter to the Commerce Department recommending a one-year extension. In short, if the Administration permits the JPA to terminate in less than four months it is on clear notice that such actions will unleash a strong bipartisan backlash from the other end of Pennsylvania Avenue. *************************************** In addition, this report appeared in this asfernoon's Congress Daily-- HILL BRIEFS: HOUSE PANEL SEEKS EXTENSION OF ICANN OVERSIGHT Technology. House Energy and Commerce Communications Subcommittee members today called for an extension of the U.S. government's oversight agreement with the nonprofit that administers the Internet domain name system. The deal is currently slated to expire Sept. 30. The Internet Corporation for Assigned Names and Numbers is "far from a model of effective and sustainable self-governance," and it would be unwise to shrink the government's role, said Rep. John Dingell, D-Mich. House Energy and Commerce Communications ranking member Cliff Stearns, R-Fla., plus Reps. Mike Doyle, D-Pa., John Shimkus, R-Ill., and Lee Terry, R-Neb., support prolonging the arrangement between ICANN and the National Telecommunications and Information Administration, citing transparency and accountability concerns. House Energy and Commerce Communications Subcommittee Chairman Rick Boucher, D-Va., is reportedly drafting a letter to NTIA with Stearns and Energy and Commerce ranking member Joe Barton that recommends a one-year extension. At the hearing, ICANN President Paul Twomey pointed out that a separate but related NTIA-ICANN contract will not sunset. He also warned that extending the joint project agreement would signal that the U.S. government does not have faith in ICANN's model. http://www.nationaljournal.com/congressdaily/hbp_20090604_9808.php Finally, an excellent series of blogs from the hearing appear at http://domainnamewire.com/category/policy-law/ under the heading "Congress Beats Up ICANN". Philip S. Corwin Partner Butera & Andrews 1301 Pennsylvania Ave., NW Suite 500 Washington, DC 20004 202-347-6875 (office) 202-347-6876 (fax) 202-255-6172 (cell) "Luck is the residue of design." -- Branch Rickey