To; ICANN public comment process on existing contracts
The personal views expressed below by Marilyn Cade are congruent with
those expressed within the ISPCP Constituency, in particular the
following recommendation;
Recommendation: ICANN should put the negotiations with various
registries that are now underway -- .biz; .info, and .org on hold until
the completion of the PDP 06 and the Council's submission to the Board
of any policies that are the outcome of PDP 06.
On that basis the ISPCP would like to express support for the above
Recommendation and urge the Board to give this serious consideration
during their deliberations.
Tony Holmes
Chairman ISPCP Constituency
_____
From: Marilyn Cade [mailto:marilynscade@hotmail.com]
Sent: Monday, August 28, 2006 5:23 PM
To: 'biz-tld-agreement(a)icann.org'
Cc: 'Marilyn Cade'
Subject: comments on biz,info and org
To: ICANN public comment process on existing contracts
These comments are submitted as an individual member of the ICANN
community, and in my individual capacity as a business user constituency
member. However, I draw on my expertise as an Councilor who has studied
these issues, read the public record as submitted by all parties, have
followed the Board and senior staff public discussions in the various
ICANN face to face meetings, monitored the various lists, including the
U.S. Department of Commerce public comments on the Memorandum of
Understanding. I am familiar with the Terms of Reference of PDP 06, and
of the work underway to address the development of policy related to
existing contracts in the Task Force. I have also reviewed the three
contracts and their appendixes that are posted for public comment in
some detail.
Recommendation: ICANN should put the negotiations with various
registries that are now underway -- .biz; .info, and .org on hold until
the completion of the PDP 06 and the Council's submission to the Board
of any policies that are the outcome of PDP 06.
According to the timeline of the Task Force, this PDP is scheduled for
completion at the end of the year, 2006.
Background:
There is a PDP underway; supporting it to its conclusion and applying
the outcome to the existing contracts should be the logical outcome to
this process.
The agreements as posted include several elements that are now the
subject of a policy development process, known as PDP 06. This PDP has a
Terms of Reference that include as an example, the terms related to
renewal conditions; whether there should be a policy concerning price
controls; whether there should be a policy guiding payment of fees to
ICANN by registries/what that policy should be; what rights the registry
has in the commercial uses of traffic data; and the relationship between
consensus policy and registry agreements.
This Policy Development process grew out of widespread agreement within
the GNSO Council that there are broader policy issues that relate to the
contractual conditions of existing gTLD agreements, after the
community's experience with how ICANN dealt with the .net and .com
negotiations. The GNSO Council and the community are taking the policy
development process and their responsibilities quite seriously and are
devoting extensive resources to addressing the Terms of Reference. The
PDP is scheduled for completion at the end of the year, 2006.
Examples of some of the area of concern that has been raised within the
community regarding the proposed posted contracts and which I support as
areas of concern:
Pricing Policy: One of the provisions in the proposed contracts gives
the Registry, which in all cases is a sole monopoly within their own TLD
space, complete flexibility at the registry level, to set prices,
including, it appears, on a per name basis. This is a seriously flawed
provision, if indeed the contracts do provide for this.
This is an area that was of significant concern to famous and well known
brand holders at the launch of ICANN, where companies who spend millions
on brand development, were concerned that registries could decide to
individually price domain names. For example, a company who holds the
world's best known brand might find itself asked to pay several hundred
thousand dollars for their domain name upon renewal. Given the lack of
'substitutability' in a trademarked brand, used as a domain name, the
corporation is essentially 'hostage' to any registry with the
flexibility of 'one off' pricing.
Building brand recognition has been done by the companies who offer the
e-commerce services, not by the registry. Registration of domain names
has to remain a matter of structural separation between registries and
registrars; registries should not be allowed to individually price
domain names at the wholesale level, which is where the registry is.
Competition at the registrar level provides protection to the cost of
registration itself - because registration services are in competitive
environments, unlike registry services.
Certain registries may believe that they should be able to speculate in
individual names, since there is now a robust secondary market in the
domain name marketplace. A secondary market in domain names does not
justify giving a sole source provider of a gTLD this capability. There
would be no controls over how registries might treat domain names, and
neither registrants nor registrars would have any protection from
individual registry decisions.
I have a number of additional concerns about the importance of
maintaining price caps, and of having a policy related to price caps.
Given that this is one of the terms of reference issues, I will look to
that process to further elaborate on those concerns.
Recommendation:
Price 'caps' which are presently in the existing contracts, should
remain in place; in fact, I would go further to note that price
platforms and ceilings should be established by ICANN for registries. It
is feasible that a sponsored gTLD may provide additional services to the
registrant, such as verification of eligibility, etc., and thus that
platform/ceiling may be different from the open/unrestricted registry
fees. It is also possible that a dominant registry could decide to
charge nothing for registration, engaging in cross subsidy, and thus
completely undercutting new entrants in newer gTLD registries.
The Task Force is discussing identification and consultation with
independent resources with expertise in anti trust and competition and
economic policies that are relevant to decisions and treatment of
registry agreements. I strongly recommend that ICANN support this
consultation and make the consultations available publicly, so that the
full community can be informed. Registries will be able to participate
fully in the consultation and offer clarifying input, in those areas
where they are not in agreement. However the proposed agreements should
not be concluded while this consultation is underway.
Perpetual/automatic/presumptive renewal:
The policy issues under examination in the PDP of high visibility and
broad community concern include a form of presumptive renewal. For
example, the Business Constituency and other constituencies and members
of the community have expressed their opposition to the form of
perpetual renewal that is in com agreement that is yet to be accepted
by the US Department of Commerce, with legal counsel by the US DoJ. Yet
a form of that assumptive renewal is included in the three draft
agreements that is the subject of this post, with no stated intent to
acknowledge, nor to take into account the policy development role and
functions of the GNSO, nor to reflect the guidance that will be
forthcoming in a matter of several weeks.
Recommendation:
The contracts should not be completed at this time. These contract
agreements should be put on hold while the PDP 06 is concluded, and the
consensus policy, whatever it is, that is the outcome, should be used to
negotiate existing registry agreements.
Policy should not be made by developing contractual terms and then
extending them into other contracts - instead the staff must become
accustomed to the fact that the GNSO is their policy partner - and it is
the GNSO that must provide policy guidelines and policy guidance. The
board itself needs to provide strong leadership and guidance to the
Staff that the policy development process must be fully supported, and
embraced, which may mean additional resources and support for
independent experts, as is now being discussed by the PDP 06 Task Force.
Extending flawed conditions to some Registries but not all:
Of even more interest is that ICANN is offering these terms to three
large registries -- .biz; info; and .org, but not to the sponsored
gTLDs. While I strongly object to ICANN undertaking the contract
negotiations until the PDP is concluded, I question why ICANN would
approach .org; which isn't lapsing until 2009, but appears not to have
offered the terms to the remaining gTLDs, such as .museum; aero, name,
etc. etc. It makes no sense to single out .org, which is over 2 + years
away and draw them forward, but not make similar offers to the other
gTLDS.
I object to the extension of these flawed conditions to any of the
registries, but note the differential treatment by staff, without
explanation.
Treatment of Traffic Data:
The agreements give far too much openness to allow the registries to
potentially control or use traffic data for undefined commercial uses.
This potentially puts others who may be dependent upon access to traffic
data to assess networking needs, or build competitive products. The
registries are essential monopolies; when site finder was introduced by
a registry, the community was gravely concerned. The terms related to
traffic data need to be more clearly documented, and the impact on
competition, and on adjacent markets examined before the terms are
agreed to in these proposed agreements.
Historically, the community has opposed the string being 'owned' by the
registry, who is to work as a contracted party to ICANN.
ICANN must take care not to be establishing a situation where a registry
could be seeking to establish ownership or control outside of, or in
addition to the terms of the contract they have with ICANN, through
establishing exclusive rights in such things as traffic data.
Treating the GNSO as a partner:
ICANN staff must become more broadly supportive to the policy
development role of the GNSO, and should assess what legal resources
should be provided routinely, to the PDP process.
It is not in ICANN's best interests, nor in the interest of ICANN
stability to create parallel processes where the legal staff negotiate
contracts, but are not integral and supportive of the policy development
process. The GNSO and the ccNSO are partners to the ICANN staff in the
development of policies to their respective areas of responsibility. .
It is in fact harmful to ICANN's international legitimacy when its broad
community so clearly is calling for one process to be followed, and
there is a completely separate set of actions that are staff driven, but
not inclusive of/nor recognizing the ongoing PDP process.
Consensus policy must be applicable to existing contracts. If there are
true justifications to why it must be modified, or delayed in its
application, that must be identified, and posted for the community to
examine and determine whether such a concept is in the best interest of
the broader community.
Of course, registries will prefer not to have any application of
consensus policy, however, there could be a mechanism for registries to
show cause why a consensus policy will directly harm their ability to
serve their registrant base, or harm the interoperability or stability
of the Internet. A comment process will allow for the registry to make
such a case and in rare circumstances, gain a waiver of consensus
policy.
We must all take great care not to even unintentionally circumnavigate
and ignore the bottom up multistakeholder participatory model that is
key to ICANN's legitimacy and to its international support.
Recommendation:
ICANN should modify the draft agreements now posted
to reflect the applicability of consensus policy, with the clear
understanding that if a consensus policy also has to undergo an
implementation assessment and during that phase, if a registry presents
justification for how consensus policy will harm the registry, result in
anti-competitive situation for one registry over another, or that the
costs of said consensus policy is unreasonable, a proposal can be given
to the relevant Task Force/GNSO Council during the final public comment
period about what the justification for any change might be. By making
this a part of a public process, and allowing review and comment by the
Advisory Councils and the public in an open and transparent way.
Conclusion:
ICANN should put the negotiations with various registries that are now
underway -- .biz; .info, and .org on hold until the completion of the
PDP 06 and the Council's submission to the Board of any policies that
are the outcome of PDP 06. And ICANN should fully resource the PDP 06
work, both with legal staff and support, and with support to independent
experts in competition and economic theory.
By fulfilling the bottom up consensus policy process, ICANN will built
its credibility and, regardless of the outcomes of the policy
recommendations, will improve the community's trust in its processes.
Submitted by Marilyn Cade
28-August 06
