Our suggestions for fixing the gTLD proposal

["Michael H. Berkens, President MostWantedDomains.com" <mike@xxxxxxxxxxxxxxxxxxxxx>]

We hereby restate our comments from comment period on first draft of  
the guidebook for the new gTLDs:
We note however that ICANN not only ignored the vast majority of first- 
round  comments, including ours, which were against the introduction  
of an unlimited number of new gTLDs, the removal of price caps, and  
other matters, but ICANN introduced  changes to the guidebook that  
were the exact opposite of the recommendations,  including those of  
the US Department of Commerce and US Department of Justice, which  
called for:
ICANN’s giving greater consideration to consumer interests.

ICANN carefully weighing potential consumer harms against potential  
consumer benefits before adding new gTLDs and renewing new gTLD  
registry agreements.
ICANN to establish competitive mechanisms for authorizing new gTLDs  
and renewals of gTLD registry agreements whereby prospective gTLD  
operators would compete for gTLDs by proposing registry terms,  
including maximum fee schedules, that would provide consumer benefits.
ICANN of course not only ignored both recommendations, but did the  
exact  OPPOSITE.
One can’t help but feel disturbed that ICANN can not only overlook  
high quality  input like that provided by the DOJ, but do the exact  
opposite.  If the DOJ’s comments are simply disregarded, how much  
weight are my comments or anyone else’s going to be afforded?
I agree with Mr. Kirikos that ICANN in the past, has erred by  
providing price increases to registries instead of allowing for  
competitive tenders and select the company that is willing and  
capabile of running the registry for the lowest cost to the consumer.
Why would a new extension being sought by two or more companies be  
awarded based on who was willing to pay ICANN the most money to run  
the registry rather than on the basis of who would be willing to run  
the registry for the lowest cost to the public?
ICANN has already stated that the application fee of $185,000 will  
cover ICANN costs of implementation.
What is the benefit of then giving ICANN a windfall well above its  
costs when its is suppose to be a non-profit corporation and has a  
track record of losing millions of excess funds in the stock market.
http://www.thedomains.com/2009/02/03/icann-losses-46-million-of-your-money-in-the-stock-market/

Competitive contracts should simply be awarded to the qualified  
company  which is willing run the registry for the lowest cost to the  
consumer.
That should be the tie breaker.

Not the one willing to pay ICANN the most.

ICANN has failed to explain why domain  registration costs at the  
wholesale level (i.e. from VeriSign, Neustar, PIR,  Afilias, etc.) are  
going up towards $7/yr and beyond where as the cost of other  
technologies have been going down and other companies have already  
expressed interest in running the .com registry for example, for less  
than 1/2 the costs currently charge.
If we have learned anything in this tough economic climate and time of  
political change that the days of the no bid contract is over.
The days of given out deals,  which hurt consumers,  but line the  
pockets of huge corporations is over.
If ICANN does not take a fair approach court challenges will mount,  
and most the money ICANN had to lose in the stock market will have to  
be spent defending its decisions.
When contracts come up for renewal Registry operators should be able  
to be replaced.
Contract should be opened to bid by any capable company and awarded to  
the lowest bidder.
Would the citizens of the world allow a government to award a contract  
to one company to build every road in the world, on a no bid contract  
with automatic renewals and no price caps?
It’s just plain silly.

We agree with My Kirikos and also urge the US government and in  
particular the Department of Justice to  investigate the no-bid  
monopoly nature of all existing gTLD registry operator  contracts.
When domain registry costs should be close to $2/yr instead of  $7/yr,  
and when one multiplies this by over 100 million domain names, this   
represents a $500 million/yr and growing abuse of consumers through
anti-competitive behaviour. This represents a fundamental failure of  
ICANN, one that ICANN now desires to expand to hundreds or thousands  
of more extensions.
What if the study by ABC Namebank is correct and over 18,000 companies  
apply for their own gTLD, creating 33 Billion dollars in revenue in  
the first 3 years for ICANN?
http://www.thedomains.com/2008/09/17/new-study-may-be-tens-of-thousand-of-new-extensions/

At some point, and no one knows if its 100 or 500 or 5,000 extensions,  
but at some point the number of extensions will cause mass confusion,  
the DNS system will be unmanageable for users, domain holders, website  
owners and trademark holders.
Once you allow an unlimited number of extensions to be granted, the  
genie is out of the bottle and there is no stuffing her back in.
The outcry from main street on ICANN’s plan has been overwhelmingly  
negative.
Popular Science calls them pointless:

http://www.thedomains.com/2009/03/26/a-non-domainers-take-on-the-new-gtlds-there-pointless/

Religious groups already see the nightmare of who would control  
extensions of religious and generic terms like .god
http://www.thedomains.com/2009/03/05/the-pope-tells-icann-to-say-no-to-new-gtld-religious-extension/

Does ICANN really want to put itself in the position of having to  
auction off .god to the highest bidder, even if that group say is a  
pro-nazi group for example?
Francis Gurry, WIPO Director-General says ICANN plan to that would  
allow an unlimited amount of extensions a “nearly unmanageable task”  
for trademark owners to monitor abuse:
http://www.thedomains.com/2009/03/16/wipo-wants-to-expand-trademark-rights-hold-registrars-responsible/

Corporate America is widely opposed to the plan as well.  The Wall  
Street Journal reported Verizon Communications, Marriott International  
and New York Life Insurance are among the companies arguing that the  
new domain extensions could open the flood gates to Internet fraud and  
drastically increase their costs of doing business online.
http://www.thedomains.com/2008/11/04/wsj-companies-are-protesting-new-domain-extensions/

Intellectual property groups are also widely against the new proposals:

http://www.thedomains.com/2008/09/15/new-domain-extensions-intellectual-property-watch-says-no/

http://www.markmonitor.com/cta/TLDcomment/index.php

Even the Olympic committee is against the new extensions and is  
threatening to sue
http://domainnamewire.com/2009/04/09/olympics-to-icann-well-sue-you/

Simply put it seems almost everyone is against the new extensions  
except for those looking to rake in the fees produced by them.
Another problem contained in the second draft of the guidebook is that  
ICANN  is basically putting all Geographical domains, now and forever,  
in the hands of government.
In the US, don’t we have that already?  Its called the .gov extension,  
and it is only available by use of the federal government.
However this proposal is far more reaching as it applies not just to  
every state and city in the US, but every country city around the  
world, every City, County, Provence, or Region.
Simply put, ICANN has set up separate rules for Geo TLD extensions or  
those that might look like a Geo domain, but is not.
According to the Guide book:

“”ICANN will review all gTLD applications to make sure the interests  
of governments or public authorities in Country or Territory names, as  
well as other types of place names.””
This means that if you apply for any new gTLD, ICANN will summit each  
application to a special committee which will determine if the  
proposed extension might be considered a Geo domain even if you didn’t  
intend it to be so.
For example maybe you wanted a .mia extension for families of soldiers  
missing in action.
That would probably we found to be a Geo extension and fall within  
these special rules in the review committee.
This committee in that case would kick the application back to you and  
tell you it’s a Geo domain extension in their opinion, and require you  
to get permission from the city of Miami to give up their rights to  
the extension and support your use.
Good luck.

The guidebook further says:

“””The following types of applications are considered geographical  
names and must be accompanied by  documentation of support or non- 
objection from the relevant government(s) or public authority(ies):
“”An application for any string that is a meaningful representation of  
a country or territory.  A meaningful representation includes a  
representation of the country or territory name in any language.””
“”A string is deemed a meaningful representation of a country or  
territory name if it is:
“The name of the country or territory; or

“Part of the name of the country or territory denoting the country or  
territory; or
“A short-form designation for the name of the country or territory  
that is recognizable and denotes the country or territory.
“An application for any string that is an exact match of a sub- 
national place name, such as a county, province, or state.
“An application for any string that is a representation, in any  
language, of the capital city name of any country or territory;
“An application for a city name, where the applicant declares that it  
intends to use the gTLD for purposes associated with the city name.
“An application for a string which represents a continent or UN region  
appearing on the “Composition of macro geographical (continental)  
regions, geographical sub-regions, and selected economic and other  
groupings”
“In the case of an application for a string which represents a  
continent or UN region, documentation of support, or non-objection,  
will be required from a substantial number of the relevant governments  
and/or public authorities associated with the continent or the UN  
region.
“An applied-for gTLD string that falls into any the above categories  
is considered to represent a geographical name (GEO).
“In the event of any doubt, it is in the applicant’s interest to  
consult with relevant governments and public authorities and enlist  
their support or non-objection prior to submission of the application,  
in order to preclude possible objections and pre-address any  
ambiguity’sies concerning the string and applicable requirements.
“It is the applicant’s responsibility to:

1.  identify whether its applied-for gTLD string falls into any of the  
above categories; and
2.  determine the relevant government(s) or public authority(ies); and

3.  identify which level of government support is required.

“The requirement to include documentation of support for certain  
applications does not preclude or exempt applications from being the  
subject of objections on community grounds, under which applications  
may be rejected based on objections showing substantial opposition  
from the targeted community.
“The documentation of support or non-objection from the relevant  
government or public authority should include a signed letter of  
support or non-objection from the minister with the portfolio  
responsible for domain name administration, ICT, foreign affairs or  
the Office of the Prime Minister or President of the relevant  
jurisdiction.
“The letter must clearly express the government’s or public  
authority’s support or non-objection for the applicant’s application  
and demonstrate the government’s or public authority’s understanding  
of the string being requested and intended use.”"
Why has ICANN given all of the possible new Geo gTLD’s and placed them  
in the sole control of the respective jurisdictions?
Sure I understand and would agree with giving a jurisdiction  
preference in competing Geo applications.
But to give jurisdictions absolute control over possible Geo extension  
seems inherently unfair.
If a jurisdiction wants to apply for its own gTLD, god bless, but if  
they don’t have the interest to do so, why give them veto power over  
private industry from doing so?
Included in the definition of a GEO domain is,”geographical sub- 
regions, and selected economic and other groupings.”
What does this mean? “selected economic and other groupings”.

Among the hundreds of pages that make up the guide book and  
attachments thereto, I cannot find a discussion, of what the term  
“selected economic and other groupings” might mean or include, or even  
an example of such a term.
Would an extension like .wallsteet, that someone might want to create  
for the financial community, fall within this section?
Maybe.

I certainly could make the argument that .wallstreet is a “select  
economic grouping” having a Geo component.
How about the “wine country” or the region in France which produces  
champagne?
What if you wanted to set up .champagne for that industry.  Is  
champagne a “select economic grouping”, as it often is referred to  
that region of France where French, but not all champagne, is  
produced? (yes I also know its a city in Illinois, that another  
problem discussed below).
Would you need the permission of the region to do such and extension,  
and if so, it appears you would have to get the permission of the  
majority of the jurisdictions that comprise the “champagne country” as  
it is called, an high improbable task.
The possibilities of what might fall within “”select economic  
grouping” are endless and undefined.
All you can do at this point is pony up your $185k and find out.

If you application is denied as being a Geo, whether intended or not,  
during after the initial review it looks like you will get $65,000  
back, so it will only cost $120,000 to find out.
What if multiple cities with the same name apply for their cities  
gTLD?, like .springfield for which there are many in the US alone.
It appears that cities would have to go through the same process that  
all other applicants do.
Come to an agreement, which is impossible to do in any logical manner  
when it comes to a Geo extension or go through the auction process .
So the good citizens of these cities would have to pony up their tax  
money, and give it to ICANN to be the high bidder in an auction  
against other cities and their taxpayers.
According to the guidebook,  in the auction format, that you can only  
bid as much as you have deposited with ICANN in advance.
So each city would have to go to the taxpayers and cough up hundreds  
of thousands, maybe millions of dollars just to place them into ICANN  
account so they could bid for their extension.
Sounds good, especially in these economic times when many city and  
state governments are broke.
I can hear it the city hall meeting now.  Good citizens we have to  
raise your property tax 1% so we can raise money to have bidding  
capital in applying for our domain extension.
Does ICANN really want to auction off extensions of cities and force  
the taxpayers of those jurisdictions which are now scrambling to keep  
their police and firefighters employed to cut services to the citizens  
to pay ICANN hundreds of thousands or millions of dollars in fees,  
that they can then invest in the stock market?
Now for our suggestions to fix this mess:

1.  Limit new gTLD introduction to no more than 5 per year, allowing  
for proper absorption .
2. All new gTLD’s contracts need to be awarded to the company willing  
to provide the service for the least cost to the public, not to the  
company willing to pay the most to ICANN.
3.  All contracts should have a reasonable term of 4 years at which  
time the contract to run the registry goes to a competitive bid where  
the contract is then awarded once again to the company willing to  
provide the service for the least cost to the public, not to the  
company willing to pay the most to ICANN.
4. Eliminate any possibility of unregulated pricing, now and forever,  
for all existing TLDs and any future gTLDs.  This issue has been up  
for consideration before and does not need to ever come up again.
5. Develop a mechanism for safeguarding brand owners from massive  
global TM infringement defense costs. Consider allowing a trademark  
registration at little or no cost to holders with real well  
established trademarks for each new gTLD, while preventing sham  
trademarks on clearly non-protectable terms, from countries outside  
the G-20 which have issued trademarks like candy on clearly non- 
protectable terms,  that have been granted in the past.
6. Conduct a high-integrity study from a truly neutral company , on  
the potential effects of introducing new gTLDs, on internet stability  
and massive consumer confusion.
7. Give governments preference in applications for Geo Domains but not  
absolute control over them.  Fix the lack of definition and confusion  
discussed above for terms such as “select economic grouping” so that  
people do not wind up spending six figures to determine if they have  
interpreted the rules correctly.  Award Geo domains to the registry  
willing to provide the service for the lowest cost and do not make the  
citizens of a jurisdiction cut governmental services to pay ICANN  
additional fees through a bidding war with others.
8. Abandon a artificially created “timeline” for launching any new  
gTLD until the above concerns,  have been genuinely resolved.


Michael H. Berkens
President
Worldwide Media, Inc.

http://www.MostWantedDomains.com

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