comments-reserve-fund-12oct17

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October 2017

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[Comments-reserve-fund-12oct17] ICANN Reserve Fund – Public Comment on Rationale and Target Level
by John Poole Oct. 19, 2017

Oct. 19, 2017

ICANN Reserve Fund – My Comment on Rationale and Target Level I have reviewed the open comment webpage <https://www.icann.org/public-comments/reserve-fund-2017-10-12-en>, read the attachment https://www.icann.org/en/system/files/files/draft- reserve-fund-12oct17-en.pdf, and reviewed other sources of information. I will concede upfront that I probably have a more conservative approach than many in the ICANN community who appear "ready to spend" ICANN's last red cent! For example, without more information, the comparison of ICANN to CIRA, or Nominet, appears ludicrous. ICANN is a unique global organization with immense exposure and unknown, unquantifiable, potential liabilities due to: 1) end of the U.S. government (IANA) contract; and 2) expansion of new gTLDs beginning in 2014 (adding complexity to a system often increases fragility or vulnerabilities). In addition, ICANN is (along with Verisign) one of the most important root server operators upon which the global internet DNS depends. Malicious threats and vulnerabilities, some attacking (or hijacking) the DNS root <https://en.wikipedia.org/wiki/DNS_hijacking>, continue to appear. Network science and technology will continue to evolve, as will vulnerabilities. Research, defense, security, continual improvements, and *incident recovery*, cost money, and catastrophic incident insurance coverage is probably not a viable option. Issues such as have arisen with the Root Zone KSK Rollover, are just the tip of the iceberg. Any event that forced ICANN to seek protection under Chapter 11 of the U.S. Bankruptcy Code could very well end ICANN's role in "coordinating" the internet. For that reason alone, it might be advisable for ICANN to consider "spinning off" its technical and root server operations into a separate "affiliate" (similar to, but separate from, PTI). For the reasons above, I would suggest, at a minimum, an "operating reserves fund <http://www.nonprofitaccountingbasics.org/reporting-operations/about-operati…>" of 24 months Opex. In addition, I suggest ICANN consider creating a "strategic reserves fund <https://en.wikipedia.org/wiki/Strategic_reserve>" of $200 million--funded from the auction proceeds ($235M) and application fees ($128M)--of which $100 million could be released for disbursement after five years if there proves to be "no need" for that level of "strategic reserves," with the balance released five years thereafter if not needed. Sincerely, John Poole Domain Name Registrant and Editor, DomainMondo.com <http://www.DomainMondo.com>

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