November 20, 2006 Dear Board Members and Mr. Twomey The Business Constituency opposes a Board decision on the .biz; .info; .org registry agreements at the upcoming meeting of the Board, November 22, 2006. We ask the Board to accept the recommendation of the GNSO Council of 28 September 2006, as described below, and further, to await and consider the expert advice that will be the output of the "independent study by a reputable economic consulting firm or organization to deliver findings on economic questions ". called for in the Board's 18 October 2006 resolution. We remind the Board and the staff of the GNSO Council's resolution, available on the GNSO website at http://www.gnso.icann.org/resolutions, where the GNSO council requested the Board to delay any decision on these contracts until the ICANN board meeting after the Sao Paolo ICANN meeting 2006, and to take into account the current outcome of the PDPFeb06 task force at that time. On 18 October 2006 the Board meeting passed resolution http://www.icann.org/minutes/resolutions-1Oct06.htm entitled Economic Study of the Proposed Registry Agreements. In that resolution, the Board noted that it has carefully considered the proposed new agreements [with the three registries], and the public comments and the registry responses, and found that the approval of the new agreements would be beneficial for ICANN and the Internet community, provided that the registry operators and ICANN are able to agree to appropriate revisions to the proposed agreements to address competition related issues, such as differential pricing. However, of significance to our recommendation to the Board, the resolution acknowledged the need for high levels of economic expertise. And the resolution then "directed the President to commission an independent study by a reputable economic consulting firm or organization to deliver findings on economic questions relating to the domain registration market, and went on to identify important issues, that to the Business Constituency's members are essential to address in an open and transparent manner. It is important to ensure this level of accountability and transparency related to the independent study's findings, so that ICANN's community of stakeholders can fully support the decisions that are made by the Board, based on recommendations of the ICANN staff, but guided by the expert advice/economic expertise. We are in agreement that these are complex issues; therefore, we have taken the time to examine where there are other pressures that may be influencing the rush to approve these agreements. We address below our concern that budget considerations may be influencing a rushed decision. We believe that the Board can be of assistance in the discussions with the Registrars, and thus remove or ameliorate that pressure. Instead of voting, we urge the Board to discuss with the President and ICANN staff the progress they have made in identifying independent expert advice; if the Staff and President are unable to pursue the study authorization as directed in the Board resolution immediately, the Board could also task the President and staff to immediately establish a interim panel of three experts in competition, anti-trust, and market analysis to provide interim consultation to the GNSO Council and Task Force, and of course, as a resource to the staff and Board. This will support the policy development process while allowing the ICANN President and staff to focus on organizing the authorized study. Further, given that the ICANN staff have not asked the Registrars to approve the budget and that this creates a financial tension, we urge the Board at the Sao Paolo meeting, to provide guidance and support to the staff, including providing active listening and pragmatic support to the discussions with the Registrars regarding how to advance their approval of the ICANN budget. Conclusion: The Board should not vote on these contracts at this time, but the Board has a critical role to play in advancing toward a time when it is both appropriate and supportable to vote on agreements with these registries. We, like the ICANN Board, seek a solution that can be broadly supportable by ICANN, the stakeholders; the Board, the registries and the registrars, and all other stakeholder representatives. We do believe that this is attainable. For instance, if the expert advice indicates that there are no competition problems and that there are sufficient safeguards, our constituency will be more informed about why we should support the approval of the registry agreements. In our view, there must be an appropriate balance of respecting the ICANN stakeholders' concerns and interests, with a predictable and accountable contracting environment in renewals of registry agreements. Financial security is one element of a stable and predictable environment for ICANN and its stakeholders. Trust and respect for decisions and for the processes that lead to decisions are also key elements. It is after all, our members and the millions of other businesses who build the Internet, create the applications and content, and provide services and products to the just over one billion Internet users. We fully appreciate and value the role that registry operations play in the functioning of the Internet Domain Name System. However, registries are suppliers, and ICANN registry agreements, and ICANN's actions must reflect the balance of supplier interests with the broader responsibilities that ICANN has. The Officers of the Commercial and Business Constituency (BC) Marilyn Cade Alistair Dixon Philip Sheppard Cc: Vint Cerf, Chair, and ICANN Board Paul Twomey, ICANN President and CEO John Jeffrey, ICANN General Counsel ICANN GNSO Council ICANN GAC Chair ICANN Commercial and Business User Constituency