ICA Comment on Users Community Joint Proposal for GNSO Council Structural Change

[Phil Corwin <pcorwin@xxxxxxxxxxxxxxxxxx>]

BUTERA & ANDREWS
Attorneys at Law
1301 Pennsylvania Avenue, N.W.
Washington, D.C. 20004-1701
202-347-6875
Philip S. Corwin, Partner
pcorwin@xxxxxxxxxxxxxxxxxx<mailto:pcorwin@xxxxxxxxxxxxxxxxxx>


By E-Mail

April 25, 2008

Board of Directors
Internet Corporation for Assigned Names and Numbers (ICANN)
4676 Admiralty Way, Suite 330
Marina del Rey, CA 90292-6601

Re: Comment on Users Community Joint Proposal for GNSO Council Structural Change

Dear Members of the ICANN Board:

This comment letter is submitted by the Internet Commerce Association (ICA) in 
regard to the Board's February 15th Resolution establishing a thirty day period 
for final public comments on the Board Governance Committee Report regarding 
Generic Names Supporting Organization (GNSO) improvements. We appreciate the 
fact that you responded to the joint request from the CBUC, IP, and ISP 
constituencies, as well as supportive statements submitted by our organization 
and many others, through the action agreed upon at your March 19th Executive 
Committee meeting to extend the comment period on this critically important 
matter until April 25th to allow sufficient time for the completion and 
submission of an alternative proposal from a diverse number of constituencies.

We are now commenting upon the Joint Proposal just submitted for your 
consideration by the:

 *   At-Large Advisory Committee (ALAC)
 *   Commercial and Business Users Constituency (CBUC)
 *   Intellectual Property Constituency (IP)
 *   Internet Service and Connection Providers Constituency (ISP)
 *   Non-Commercial Users Constituency (NCUC)

ICA is a not-for-profit trade association representing the direct search 
industry. Its membership is composed of individuals and companies that invest 
in domain names (DNs) and develop and monetize the associated websites, as well 
as the companies that serve them. Professional domain name registrants are a 
major source of the fees that support registrars, registries, and ICANN itself.

General Position

The ICA was recently admitted as an international member of the Commercial and 
Business Users Constituency (CBUC) and submits this comment in that capacity.

The ICA's position on the Joint Proposal is:

 *   We generally support the Joint Proposal submitted by the Users Community 
(UC).
 *   We agree that the February 15, 2008 Report from the Board Governance 
Committee is a proposal for radical structural change of the GNSO Council that 
maintains and enhances the dominance of the contract parties while diminishing 
the role of commercial interests.
 *   We agree that the BGC Report has key defects relating to adequate 
incentives for effective policy development; credibility of commercial interest 
participation; and ICANN's oversight and public interest responsibilities.
 *   We therefore urge the ICANN Board to adopt the Users Community proposal 
rather than the BGC proposal at its upcoming meeting in Paris. At a minimum, if 
the Board correctly understands the Users Community proposal as evidence of 
broad dissent from and misgivings about the BGC proposal but finds itself 
unable to adopt the UC proposal in full it should delay final action on this 
matter until later this year and use the additional period to bridge the gap 
between those two competing proposals. Coming at the end of ICANN's first 
decade of experimentation and evolution, and in advance of the expected 
termination of U.S. oversight likely to occur within the next few years, we 
suspect that the Board's decision on this matter will shape ICANN's operations 
for at least the coming decade without significant future alteration. It is 
therefore far more important to make a right decision than a rushed decision.

Discussion

As it now appears inevitable that ICANN will undertake some restructuring of 
the GNSO, it is important that the revised structure be both perceived as fair, 
and be fair in fact, if key constituency groups are to continue their active 
voluntary and self-funded participation with ICANN's policymaking process, as 
well as their support for ICANN as the proper organization for long-term 
management of the domain name system (DNS). We believe that between the two 
competing proposals for GNSO structural reform - those from the BGC and the UC 
- the latter better achieves that central goal. The voting ratio between the 
registry and registrar contract parties and the commercial users community 
under the current GNSO structure is 12:9 (4:3). That near-equity would be 
changed in substantial favor of the contract parties under the BGC proposal by 
altering the ratio to 8:4 (2:1), whereas the UC proposal would balance it at 
6:6 (1:1).  Also, as noted in the CBUC-IP-ISP joint request submitted last 
month for an extended comment period, the voting influence of the commercial 
users within the overall GNSO structure would drop from 33% under the current 
arrangement to 21% under the BGC proposal, while it would be maintained at 33% 
by the UC proposal. While we understand that both of the currently competing 
proposals envision a great deal more of initial policy development to be 
conducted through targeted and temporary cross-constituency working groups, we 
nonetheless believe that formal voting power will continue to have a major 
influence on ICANN's ultimate policy decisions. We therefore cannot acquiesce 
to a substantial downgrading of the relative voting power of commercial 
constituencies, including that of the domain name investors and developers who 
comprise the ICA.

ICANN's handling of this critically important matter can also be expected to 
have a substantial effect on the decision of the U.S. government regarding 
extension or termination of its oversight of ICANN when the current Joint 
Project Agreement (JPA) expires in 2009, as it directly bears on whether 
ICANN's operation conforms with the vision of private sector leadership that 
was a central objective in ICANN's creation. As we stated in our submission of 
February 15, 2008 to the Department of Commerce in regard to the JPA:

ICANN is in the process of considering a proposal for GNSO "improvements" that 
would substantially reduce the ability of the three present business sector 
constituencies - commercial and business users (CBUC), intellectual property 
(IP), and Internet service providers (ISP) to influence ICANN's policymaking 
process. This downgrading would be accomplished by shifting much of the policy 
development process to ad hoc working groups while simultaneously awarding half 
of all voting power to  the two constituencies with which ICANN has direct 
contractual relationships (registries and registrars), with the combined 
noncontractual business sector constituencies sharing one-quarter of all voting 
power. As the ICA has just been provisionally approved as a member of CBUC this 
downgrading of business sector policy influence will diminish the ability of 
professional registrants to influence ICANN policymaking.

The ICA shares the substantial concern of other business entities that, under 
the pending proposal, the contractual constituencies will have little incentive 
to make the ad hoc working groups effective drivers of policy decisions - and, 
at the same time, the diminished role of noncontractual business entities will 
undermine their incentive to continue active participation in the ICANN 
process. In the long term this will diminish ICANN's credibility and quite 
possibly lead to the perception that it has morphed into a trade association 
for the contractual parties. This result would be at sharp odds with the 
original vision of ICANN as a consensus-driven, bottom-up organization taking 
its overall direction from commercial and noncommercial users of the domain 
name system, and not from the middlemen who administer it. No firm decision 
regarding termination of the JPA should be undertaken until a final decision on 
the future structure and operation of the GNSO has been made and the results of 
that decision have been observed for a reasonable period of time.

Conclusion

We hope that the Users Community Joint Proposal will receive fair and full 
consideration by the ICANN Board prior to its meeting on June 27th in Paris, at 
which you are expected to make a final decision on this matter of fundamental 
importance to the future of the ongoing ICANN experiment in private-sector 
based DNS management. Your decision will go to the heart of the ICANN structure 
and policy making process, and will have long term consequences for ICANN's 
operations as well its perception by all interested parties. We therefore urge 
the Board to adopt a revised GNSO structure that more equitably balances the 
formal participation and influence of the ICANN contract parties with those of 
outside commercial and business interests and users.

Thank you for your consideration of our views.

Sincerely,
Philip S. Corwin
Counsel, Internet Commerce Association




Philip S. Corwin
Partner
Butera & Andrews
1301 Pennsylvania Ave., NW
Suite 500
Washington, DC 20004
202-347-6875 (office)

202-347-6876 (fax)

202-255-6172 (cell)

"Luck is the residue of design." -- Branch Rickey