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On A. van Couvering's comments regarding a possible "dual call EOI"

  • To: eoi-new-gtlds@xxxxxxxxx
  • Subject: On A. van Couvering's comments regarding a possible "dual call EOI"
  • From: Bertrand de La Chapelle <bdelachapelle@xxxxxxxxx>
  • Date: Fri, 11 Dec 2009 14:01:51 +0100

Thanks to Anthony van Couvering for his comments on the contribution I
posted on behalf of France regarding a possible "dual call EOI" (first the
string, then the applications). Detailed responses are inline below (an
easier to read version in pdf format is attached to this mail) .

 However, before getting into the substance of the matter, it is worth
recalling general guiding principles contained in seminal documents, to be
firmly kept in mind as we collectively undertake the most significant – and
irreversible - transformation of the Domain Name Space ever :

   - “*The Internet Naming system is a public resource* in the sense that
   its functions must be administered in the public or common
interest” (*Governmental
   Advisory Committee Principles regarding new gTLDs, **March 28, 2007*)
   - Given that “there is a group of participants that engage in ICANN’s
   processes to a greater extent than Internet users generally”, “[ICANN must]
   ensure that its decisions are in the public interest and *not just the
   interests of a particular set of stakeholders*”, (*Affirmation of
   Commitments, **September 30, 2009*)
   - “The major concern in selecting a designated manager for a domain is
   that it be able to carry out the necessary responsibilities, and have the
   ability to do a equitable, just, honest, and competent job.[ ]*These
   designated authorities are trustees for the delegated domain*, and have a
   duty to serve the community. [ ] Concerns about "rights" and "ownership" of
   domains are inappropriate. It is appropriate to be concerned about
   "responsibilities" and "service" to the community. (*the founding RFC
   1591 by Jon Postel*)**

Moreover, ICANN’s core values n°5 and 6 recommend “depending on market
mechanisms to promote and sustain a competitive environment, *where feasible
and appropriate*”, and “introducing and promoting competition [ ] *where
practical and beneficial in the public interest*”. In a year 2009 that saw
the Nobel Prize in Economics awarded to the theory of “incentives” and the
“management of commons”, after the 2007 one awarded to “mechanism design”,
one can expect ICANN to broaden its economic perspective beyond simplistic
and limited theories of competition that have proven so detrimental in the
last two years on the international scene.

Discussions on Expression of Interest mechanisms can either deepen the
growing tension surrounding the new gTLD program or be the turning
point *bringing
the community back together on a consensus to move forward*. We hope the
responses below contribute to the later.

This exploration of such a "dual call EOI" (first the string, then the
applications) is a contribution to a debate that must now be conducted more
broadly by the community. And *the setting up of an ad hoc cross-community
working group *would be the best way to rapidly develop a balanced EOI
process before Nairobi.

Bertrand de La Chapelle
Special Envoy for the Information Society
French Ministry of Foreign and European Affairs

   - *To*: eoi-new-gtlds@xxxxxxxxx
   - *Subject*: Response to B. de la Chapelle's ideas
   - *From*: Antony Van Couvering <avc@xxxxxxxxxxxxxxxxxxxx>
   - *Date*: Fri, 4 Dec 2009 10:33:15 -0500


Bertrand de la Chapelle put forward an interesting idea in his response to
the Board's call for comments about expressions of interest for new gTLDs
(see http://forum.icann.org/lists/eoi-new-gtlds/msg00073.html).

His proposal is that potential applicants should submit just the string, and
that anyone could then apply for that string.  I quote:


- During the Expression of Interest (duration to be determined), potential

applicants would submit their intended string(s).

- After the closure of the Expression of Interest, the list of strings would
be published and only those strings would be considered in the first round
of new TLDs.

- Capacity to apply for the delegation of the management of each of these

TLDs would however remain open to other candidates during this first round

(longer duration period).


On first glance, this seems appealing. Unfortunately, it won't work, for the
following reasons:

1. There is no fee in his proposal, which means that anyone could (and
would) submit every possible string to the EOI, in order to preserve their
opportunity to apply for whatever string they want.

2. If there were a fee, no-one would submit an EOI, because you would be
paying to enable the competition, which is not something anyone wants to do.


COMMENT : Actors respond to incentives. And mechanisms shape the actors’
understanding of their own interest. In the “dual call” described above
(first the string, then the applications), the two behaviours envisaged by
Anthony would go against the interest of potential applicants and therefore
appear unlikely :

-   If there is no fee, submitting hundreds of strings in a first EOI would
be self-defeating. No actor has enough human and financial resources to
apply for, obtain delegation of and operate hundreds of TLDs in the first
round. Why then would anyone invite competition from other actors on
valuable strings that could be kept for later ? Especially if the process
guarantees that one can apply in the formal call for any string submitted in
the EOI ?

-   Likewise, if there is a fee, not applying for a string just means
forfeiting the right to apply in the application call (as only the strings
presented in the string call would be considered). Applicants would not be
paying to “enable the competition” but to be able to take part in it and any
other applicant would of course also have to pay the same amount. So the
objection 2 is not valid. In any case, the argument could be reversed :
would paying a high fee to prevent competition be acceptable ? That is the
potential risk of the currently proposed EOI.

In fact, the “dual call” proposal did not explicitly exclude fees. It just
left the issue to later discussion. Moreover, many serious applicants have
spontaneously made public their intention to apply, with the risk of
initiating competing bids. Why should the EOI process be different and
favour those who have remained in stealth mode and been less transparent ?*

The “dual call” is likely to encourage applicants to concentrate on the
strings they care most about. This self-stabilizing function could bring to
the fore the most useful strings in the first round : those perceived as
having the most potential or those with the most structured support.

Finally, if a diversity of applicants for a string is revealed by the
application call, they are expected to negociate to combine forces and
present better built proposals in the formal round, in order to avoid
auctions. This would be an improvement from the current DAG rules which make
combining proposals difficult.

Some actors may rightly fear that a reopening of the application window will
encourage deep-pocketed actors to try and blackmail applicants into buying
them out. This concern must be addressed but can be solved.


3. There are multiple new TLD proposals that I have seen where the string

itself is not so valuable (as Bertrand puts it, "“high-value common names”)
but the business plan behind it is great.  But to publish the string would
give away the business plan.


COMMENT : No such proposal has of course emerged but it seems difficult to
imagine a significant example : if the string is not meaningful, can it
really reveal the business plan ? If Google at creation had applied for a
TLD, who would have guessed the business plan (they did not have one at the
time) or even the activity ?

But let’s suppose there are such cases : a non-common name string (and
non-geographic, non-brand and non-community) that nonetheless reveals so
clearly the business plan that it would be unfair to the proponent to make
it public. Should the main process be tailored only to accommodate such
exceptions ? Why not explore whether a specific request for confidentiality
could be made in such rare cases (with appropriate validation procedure) ?

Our common interest is to enable innovative applications leveraging the DNS
in useful ways. Innovation will certainly flourish ultimately. But most of
the first applications are likely to be in the basic categories mentioned
before, because they are the low hanging fruits. And innovations will be in
the business plan and second-level registration policies that are not part
of the string call.


So Bertrand's proposal, while attractive, is easily gamed and unjust to some


COMMENT : Are we sure that the current proposal does not present more risks
of gaming ? As for unfairness to some applicants : let’s explore further the
reality of the concern and whether it can be addressed.


I am furthermore disturbed by an insistent theme in Bertrand's post, which I
think needs to be addressed before it becomes yet a fossilized term with no
meaning, and a touchstone for those who would derail the new gTLD process.  I
refer to "fairness," especially as it concerns the supposed advantages
enjoyed by the "ICANN insider."

We are now laboring under the four (now five?) "overarching issues." These
were never referred to in the policy development process, but are an
invention of ICANN staff introduced by staff in March 2009 in Mexico, and
are now enshrined in the ICANN process for no good reason whatsoever.  They
are even referred to as "threshold" issues, again with no basis.  The "ICANN
insider" threatens to become another of these code words.  In his post,
Bertrand is at pains to make sure that this mythical beast does not have any
unfair advantage.


COMMENT : Comparison with the “overarching issues” is not relevant here.
Their appropriateness should be the subject of another thread.

As for the expression “ICANN insider”, it was not intended as derogatory and
mainly refers to the AoC mention of “a group of participants that engage in
ICANN’s processes to a greater extent than Internet users generally”. The
whole issue is the different levels of awareness regarding the process and
the risk of giving an undue advantage in these early stages to actors who
have followed – and in some cases have actively participated in or
influenced – the whole policy development process.

No EOI process should lock a list of applicants before the global
communication campaign on the gTLD round is being conducted. (Further
comments below on the notion of insiders)


So far, the only unfair advantage given to anyone are to the ccTLDs, who
enjoy protection from the ultimate ICANN insiders, who now wield increased
powers -- the Government Advisory Committee.   The issues of trademark
protection, root scaling, malicious conduct, which weigh so heavily on the
gTLD process, were simply ignored with respect to the fast track ccTLD IDN
process, even though reason would suggest they apply equally.   Personally,
I am in favor of expansion of the namespace because it helps consumers, and
so I support the new IDN ccTLDs.  It is nonetheless disingenuous to speak
about fairness in one process and to ignore it in another.


COMMENT : The qualification of governments as “ultimate ICANN insiders” is
an interesting quote, to say the least J More seriously, the IDN ccTLD Fast
Track has precisely introduced the distinction between string application
and delegation to a specific operator. Furthermore, the “overarching issues”
do not “apply equally” to the IDN ccTLDs Fast Track :

-   no root scaling issue : the number of applicants in the Fast Track is
expected to be in the tens of applications (30-40 or so), not hundreds or

-   ccTLDs seem to offer more guarantees regarding trademark protection and
malicious conduct if we judge from the records of UDRPs and various security
reports (and any exception should be dealt with), mainly because of the
implication of national governments and the existence of national legal
systems enabling enforcement

-   clear public interest benefit : no market evaluation was needed to
demonstrate that the introduction of IDNs serves the user’s interest and
corrected the privilege enjoyed by Latin languages for 20years

Fairness is not breached when different situations are treated differently,
with due respect to proportions. Only gTLDs raise potential root scaling
issues, because of their expected high number (think brandTLDs and
geographic names), and no international regime guarantees protection and
easy compliance in honest second level registration policies. Hence the need
for specific safeguards in the case of gTLDs.


Now, to the supposed "ICANN" insider.  Some of those who plan to apply for
new gTLDs (such as myself) have been involved in ICANN for some time.  But
many participants are brand new.

.paris -- Is the City of Paris an ICANN insider?  Assuredly not.

.nyc -- Is the City of New York an ICANN insider? No.

.eus -- Is The Basque language community an ICANN insider?  No.

.gal -- Is the Galician region of Spain an ICANN insider?  No.

.bzh - Is the Breton region of France an ICANN insider?  No.

.board, .skate, .ski, .bike, .surf - Is Adrenaline TLD, the group behind
these, ICANN insiders?  No.

.eco - Is Fred Krueger, my partner, an ICANN insider?  No, he wanted to
start .eco without knowing anything of ICANN and became involved in ICANN
just last year.

This list could be considerably extended.  In fact, of all the announced

potential TLD applications, only a very few are from people who have

participated in ICANN for more than a year.    And many of the remainder
could only considered "insiders" because the process has taken so long.



As mentioned in our previous contribution : “[A bias in favour of ICANN
insiders] may barely affect geographic, brand or community-related TLDs. But
it would be of major importance for what could be called “high-value common
names”, that is : relatively short names (no more than 6-7 characters) with
high semantic meaning (frequently used dictionary common names in different
languages, but particularly in English). No EOI should actually result in
enabling ICANN insiders to potentially pre-empt the most valuable resources
before the rest of the world even becomes aware of the existence of the gTLD

The first examples given above are related to geographic and linguistic
TLDs. Here, support/validation from local authorities or relevant
communities will be necessary anyway. This guarantees that delegation of the
TLD will not be made on a purely first-come/first-serve basis. This limits
the risk of pre-emption whatever the modalities of the EOI are.

On the other hand, the Adrenaline TLD example - as you chose to mention it –
is a very interesting test case, as a quick online research illustrates. The
founder of Adrenaline TLD describes himself on his blog as a “domain name
industry expert”, has worked successively at major registrars (Register.com
and MelbourneIT), MarkMonitor and currently Corporation Services Company
(CSC), a “leading authority in domain name management”. This is a remarkable
qualification in terms of expertise, and something that would definitely be
taken into account positively in any evaluation process. But can it be
argued that this is not someone aware of ICANN’s activity more than most
people ? And that the intended strings are “high-value common names” (ski,
surf, board, bike, skate) ?

Therefore the example seems only to validate our point. Such applicants are
perfectly legitimate and their entrepreneurial drive should be encouraged.
But managing high-value common names is not like establishing a simple
business activity : can the right to apply for the delegation of such a TLD
(especially if it is for ten years with an “expectancy of renewal”) be
limited to a process opened during a mere few weeks before any large-scale
communication has been made ?* *


When we consider "fairness," we should keep our eye on the prize.  The

"fairness" we should consider is to the people who use the Internet, the end
users.  They will benefit from new namespaces. They will benefit from lower
prices and increased choice. They will benefit from competition among
registries. Fairness to this or that applicant will come from a predictable,
timely, and well-administered application process.

A quick glance at the latest DAG -- if the word "quick" can in any way be

associated with it -- will convince anyone with an unjaundiced eye that this
is not an undertaking for the naive and uninformed. The technical
requirements are substantial. The policy requirements are substantial.  Anyone
who is not an "insider" will quickly need to hire one or more insiders just
to understand the DAG, let alone complete the application or run a registry.


COMMENT : Competition between registries is for a large part a misnomer : a
dotParis will not directly compete against a dotSport any more than a dotEus
would compete with a dotFacebook. Even within classes, a dotHotel does not
compete with a dotMusic nor dotNyc with dotBerlin. Some semantically-related
strings may ultimately compose competition clusters : dot Music with dotJazz
or dotSoul maybe, or dotSport with dotGolf or dotSoccer. The main
competition however will be between the back-end registry services or
potentially among actors who intend to constitute portfolios of gTLDs, not
mainly between the TLDs themselves.

Opening up the gTLD space will likely create a robust marketplace for
consultancy and registry services and this should be welcomed. In that
context, applicants hiring outside expertise to handle their complex tasks
is not a problem : it is actually enabling more actors to participate.

But this is clearly different from a situation where major domain name
industry players would end up being themselves the operators (registries) of
most of the highly valuable new TLDs, because they were able to apply in a
very early phase. The “dual call EOI” therefore intends to preserve some
level playing field for actors without current knowledge of the new gTLD
process to be able to take part in it. Service providers that can provide
them with the technical or legal expertise they may lack can actually only
benefit from it.* *


Let us therefore be very careful when talking about fairness and ICANN

- The new gTLD process has already attracted many new applicants. The DAG is
well-publicized and is available for all to see.


COMMENT : True. It is however not finalized and several contributions have
highlighted the legitimate reluctance of many actors to apply before the DAG
is complete, especially if there is a fee. Too restrictive rules for an EOI
would lock them out.


* *

- There is no indication that "insiders" are monopolizing the applications.
The evidence suggests the contrary.


COMMENT : In any case, this will only be known after the EOI is completed
and proper rules must be designed in advance to make sure this does not
happen. Ex-post remediation is not an option here if the community wants a
predictable and orderly process.


* *

- Fairness is a far more meaningful concept when applied to the actual users
of the Internet


COMMENT : This does not mean it is not relevant regarding applicants too.


* *

- It is virtually impossible to apply for a new gTLD without substantial
"insider" knowledge


COMMENT : Of course, it may be virtually impossible to apply for a new gTLD
without possessing or hiring substantial expertise. But this should not mean
that only those with such “insider” knowledge themselves will de facto have
the opportunity to apply in the EOI. This would simply not be a fair


Let's come up with a fair process and stop trying to pick and choose who
should get what name, or designate special classes of people who should be
disadvantaged.   That was the fatal flaw of the previous gTLD rounds and we
should not replicate it now.


COMMENT : The explanations above will have hopefully clarified the approach
and helped alleviate the fear that this is intended to disadvantage anybody.
An effort to rebalance a process that risks advantaging some actors is not
the same as being discriminatory. On the contrary, the most serious
applicants, as well as their potential contractors, will actually benefit
from the increased transparency and fairness of a “dual call EOI” or an
equivalent mechanism.


* *

Antony Van Couvering

CEO, Minds + Machines

Bertrand de La Chapelle
Délégué Spécial pour la Société de l'Information / Special Envoy for the
Information Society
Ministère des Affaires Etrangères et Européennes/ French Ministry of Foreign
and European Affairs
Tel : +33 (0)6 11 88 33 32

"Le plus beau métier des hommes, c'est d'unir les hommes" Antoine de Saint
("there is no greater mission for humans than uniting humans")

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