Hello Nigel,

The 30% volume reduction is based on direct feedback and conversations from serious applicants who are considering applying, while the 15% increase is a conservative, informed estimate.  

Kind regards,

Christa

From: Hickson, Nigel (DSIT) <nigel.hickson@dsit.gov.uk>
Sent: February 9, 2025 9:23 PM
To: Christa Taylor <christa@dottba.com>; Lars Hoffmann <lars.hoffmann@icann.org>; Martin Sutton <martin@tldz.com>; Jim Prendergast <jim@GALWAYSG.COM>
Cc: Michael Karakash via SubPro-IRT <subpro-irt@icann.org>
Subject: RE: [SubPro-IRT] Re: [Ext] Re: Re: Next Steps + Language on Fees and Application Questions

OFFICIAL

Christa cc as above

Good evening; this was very interesting.  Just wondered where the assumptions in the table come from?

Best

Nigel  

OFFICIAL

From: Christa Taylor via SubPro-IRT <subpro-irt@icann.org>
Sent: 08 February 2025 10:05
To: Lars Hoffmann <lars.hoffmann@icann.org>; Martin Sutton <martin@tldz.com>; Jim Prendergast <jim@GALWAYSG.COM>
Cc: Michael Karakash via SubPro-IRT <subpro-irt@icann.org>
Subject: [SubPro-IRT] Re: [Ext] Re: Re: Next Steps + Language on Fees and Application Questions

Hello IRT,

I am surprised by the changes to the refund percentages and the lack of transparency regarding fees. If ICANN projected an application fee of $227,000, then each stage of the process should be clearly outlined with associated costs. This transparency would allow the Working Group to make more informed decisions and foster greater trust in the process.

The proposed refund percentage currently suggested at 65%. This has significant implications for applicants' risk tolerance, reflects poorly on ICANN, and will undoubtedly impact application volume.  As illustrated in the chart below, refund percentages have a direct impact on application volume and resulting revenues. At a 65% refund level and an estimated 1,500 applications, it is reasonable to expect that 30% of potential applicants will forgo applying, leading to over $102,150,000 in lost applicant revenues.

Increasing the refund percentage would help mitigate these losses by encouraging greater participation. For instance, at a 90% refund level, application volume could increase by 15%, generating over $51,000,000 in additional application revenues.

Why is this a problem?

Applicants are hesitant to proceed due to the financial risks involved—particularly the potential of auctions. Additionally, applicants are not willing to lose $80,000, along with other related applications time and costs, within just a few weeks, with no justification or opportunity for financial recovery.  Applicant Support applications are even less risk tolerate further impacting all of ICANN and the community’s efforts.  

Furthermore, justifying the $70 million implementation cost under these conditions is difficult to defend. Those who withdraw receive no benefit, while those who proceed bear the full cost burden. A higher application volume strengthens ICANN’s financial position, reduces program risk, and ultimately supports the program’s core objectives: enhancing innovation, competition, and consumer choice.

ICANN should reconsider these refund policies to ensure a more balanced and applicant-friendly approach, promoting confidence in the process rather than deterring participation.

Regards,

Christa

Christa Taylor, B. Tech, CMA, CPA, MBA, MSPA
Co-Founder, TLDz
E: Christa@TLDz.com

T:  +1 604 961-9460  +33 7 50 66 80 92
TLDz.com

From: Lars Hoffmann via SubPro-IRT <subpro-irt@icann.org>
Sent: February 8, 2025 9:42 AM
To: Martin Sutton <martin@tldz.com>; Jim Prendergast <jim@GALWAYSG.COM>
Cc: Michael Karakash via SubPro-IRT <subpro-irt@icann.org>
Subject: [SubPro-IRT] Re: [Ext] Re: Re: Next Steps + Language on Fees and Application Questions

Thank you, Martin.

I fail to see the difference between our Tshirt sizing and Jeff’s, other than he used lower assumptions. With that in mind, it seems that Marika’s suggestion to not start a community discussion on hypothetical numbers seems the best way forward. Once we have third-party proposals, we will share can figures that will include – to the extent possible - a breakdown of cost composites, as Jeff also suggested.

Related to this point, I think it was @Jim Prendergast who had asked for an overview of upcoming RFPs – I can report that we are preparing a website to show a timetable of our procurement schedule and that should be available in the coming weeks.

Thank you all and best wishes,

Lars

From: Martin Sutton <martin@tldz.com>
Date: Saturday, 8 February 2025 at 09:33
To: Lars Hoffmann <lars.hoffmann@icann.org>
Cc: Rubens Kuhl <rubensk@nic.br>, Michael Karakash via SubPro-IRT <subpro-irt@icann.org>
Subject: Re: [Ext] Re: [SubPro-IRT] Re: Next Steps + Language on Fees and Application Questions

Hi Lars,

Understood, let’s avoid t-shirt sizing. But that should not prevent more realistic estimates to be included in the table, where these can be calculated and shared before the meeting. The example Jeff provided for the brand verification should be straightforward (even if ICANN chooses to outsource) to estimate costs for an efficient process. 

Absent of fees, drafts of each process would be ideal to share with the IRT to help refine and streamline, and keep any additional costs reasonable and fair.

Cheers,

Martin

Martin Sutton

Co-Founder

E:  Martin@tldz.com

T:  +44 7774 556680

TLDz.com

On 8 Feb 2025, at 07:47, Lars Hoffmann <lars.hoffmann@icann.org> wrote:

Thank you, Martin, for the clarification. After the IRT’s feedback on the unhelpfulness of t-shirt sizing the conditional evaluation fees during the call and on the list, Marika had indicated in her email to you on Wednesday [lists.icann.org], that we will take out these figures, which were based on our 2012 experiences. It seems more productive to continue discussing the conditional fees when we have some concrete offers from vendors on what the likely pass-through costs will be, by which time we should also have a more detailed understanding of the staff resources that may need to be involved in the admiration side of these evaluations.

Best wishes. Lars

From: Martin Sutton <martin@tldz.com>
Date: Saturday, 8 February 2025 at 08:23
To: Lars Hoffmann <lars.hoffmann@icann.org>
Cc: Rubens Kuhl <rubensk@nic.br>, Michael Karakash via SubPro-IRT <subpro-irt@icann.org>
Subject: [Ext] Re: [SubPro-IRT] Re: Next Steps + Language on Fees and Application Questions

Hi Lars,

I think Ruben’s may be referring to the additional fees on page 3, where these items remain blank.

Regards,

Martin

Martin Sutton

Co-Founder

E:  Martin@tldz.com

T:  +44 7774 556680

TLDz.com

On 8 Feb 2025, at 07:12, Lars Hoffmann via SubPro-IRT <subpro-irt@icann.org> wrote:

Dear Rubens,

Thank you for kindly reaching out. When I checked the Google Doc just now, I could see the fee language. I also saw another external IRT member in the document. Version history seems to suggest the document had been available and not modified since before I sent the email yesterday. So perhaps the issue is at your end. In any case, attached is a PDF version that hopefully works.

Kind regards. Lars

From: Rubens Kuhl via SubPro-IRT <subpro-irt@icann.org>
Reply-To: Rubens Kuhl <rubensk@nic.br>
Date: Friday, 7 February 2025 at 20:48
To: Michael Karakash via SubPro-IRT <subpro-irt@icann.org>
Subject: [SubPro-IRT] Re: Next Steps + Language on Fees and Application Questions

1. On Tuesday, we will focus on Fees [docs.google.com] and the RA. You can now review the draft AGB language on fees [docs.google.com], which includes updates based on the feedback we have received to-date, including an additional refund window, refund options for strings that are determined to be of high risk of collision, and refunds in case of material changes to the AGB. Draft AGB Language: Application Fees [docs.google.com]

It would be nice to have the actual fees before the session. For now they are blank. 

Rubens

<EXT_Application Fees.pdf>

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