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Supplemental Economic Report Comment/Question

  • To: <competition-pricing-prelim@xxxxxxxxx>
  • Subject: Supplemental Economic Report Comment/Question
  • From: "Michael Palage" <michael@xxxxxxxxxx>
  • Date: Fri, 17 Apr 2009 19:31:22 -0400



To further illustrate my point that ICANN's failure to date to conduct a
"full market" economic study has resulted in a piecemeal analysis of this
important fundamental issue, I would like to highlight the recently
submitted comments of Demand Media and Yahoo.


In Demand Media's comments there are two points worth noting. First , they
reference selling domain names in over 50 TLDs.  However, they did not
provide a detailed breakdown between gTLDs and ccTLDs, this homogenous
approach to the market place ( a blending of ccTLD and gTLDs) is an
important non-distinction that should be accounted for in any type of
economic study. Second, Demand Media specifically references that "many
ccTLDs out-compete .COM  in their markets." This is another important
acknowledgement admitting the competitive nature of gTLDs and ccTLDs in the
domain name eco-system.


The growing importance of ccTLDs as a viable alternative for both
individuals and businesses was also highlighted in the Yahoo comments.


As if these acknowledgements by ICANN's second largest accredited registrar
with over twelve years of experience in the industry and Yahoo one of the
Internet's most widely recognized brands is not enough, one only needs to
look at the numbers provided by ZookNic in VeriSign's most recent The Domain
Name Industry Brief (http://www.verisign.com/static/044518.pdf).  This
report not only evidences a 22% growth rate within the ccTLD market, but
also demonstrates how VeriSign views the ccTLDs and gTLDs as one global
domain name market place in their analysis.


What puzzles me and is a growing point of concern is how the rest of the
world's experts view the domain name eco-system as a blending of gTLD and
ccTLDs, yet ICANN and its experts appear to be wearing blinders and focusing
exclusively on the gTLD market place instead of the "full market" Paul
Twomey referenced at the annual meeting in 2006, see


Best regards,


Michael D. Palage






From: Michael Palage [mailto:michael@xxxxxxxxxx] 
Sent: Friday, April 17, 2009 6:26 PM
To: 'competition-pricing-prelim@xxxxxxxxx'
Subject: Economic Report Comments/Questions




With several important public comment periods closing within a short period
of time, please excuse the informal nature of my questions/comments.


1)      ICANN is releasing an ever increasing number of important
policy/governance documents upon the community, is it possible that ICANN
look at spacing things out a bit?  For people with day jobs it is becoming
increasingly difficult to keep up with the ICANN perpetual public forum
machine. While staff should be complimented for the increased quality in
connection with a number of these reports, if people do not have time to
digest them and meaningfully comment this should be a concern to ICANN.

2)      As I have commented in other fora, where is the "full market"
economic analysis that ICANN's president and CEO referenced during the 2006
annual meeting. Instead of a continued piecemeal release of economic reports
that fail to address the original questions that the Board asked, ICANN
should provide the community the "full market" analysis discussed almost two
and half years ago.

3)      When ICANN gets around to conducting this "full market" analysis, it
needs to address the following issues:

a.       The growing market acceptance of ccTLDs which now account for 10
out of the 15th largest TLDs;

b.      The disproportionate financial contributions that gTLDs contribute
towards ICANN's ever expanding budget (e.g. gTLDs registries, registrars and
registrants currently contribute around 95% of ICANN's 67 million projected

c.       The different regulatory/technical standards that ICANN imposes on
gTLDs and ccTLDs (i.e. Wild cards prohibited within gTLDs but permitted
within ccTLDs);

d.      Potential first mover advantage that ccTLDs may have in offering IDN
equivalents to the marketplace at potentially preferential terms;

e.      The need to reevaluate  the two-letter (ccTLD) and three-letter
(gTLD) nomenclature. This artificial distinction  began to blur following
the  2000 round with several new gTLDs exceeding the traditional three
letter string. This blurring on the ccTLD side will soon happen in
connection with ccTLD IDNs that no longer comply with the two letter string
restriction. Therefore, it is time to evaluate the entire TLD nomenclature
to see if these artificial labels are inhibiting innovation, choice and
competition in the marketplace as recently noted in the HP correspondence to
ICANN, see  <http://forum.icann.org/lists/2gtld-guide/msg00121.html>


Respectfully submitted,


Michael D. Palage

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