RE: [gnso-vi-feb10] Merged Proposal

["Neuman, Jeff" <Jeff.Neuman@xxxxxxxxxx>]

See my responses below (which may or may not be the same as Jon's as we have 
not discussed these issues).

Jeffrey J. Neuman
Neustar, Inc. / Vice President, Law & Policy

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From: Michael D. Palage [mailto:michael@xxxxxxxxxx]
Sent: Monday, April 26, 2010 11:57 AM
To: 'Jon Nevett'; Gnso-vi-feb10@xxxxxxxxx
Cc: Neuman, Jeff
Subject: RE: [gnso-vi-feb10] Merged Proposal

Jon/Jeff,

Thanks for the update. Just a couple of quick questions.

Question #1:  You propose allowing an entity to increase cross-ownership beyond 
15% in 18 months if the ICANN community supports new criteria.  What happens if 
an applicant located in the US goes and gets a business review letter from the 
US Department of Justice stating that their business proposal concerning joint 
ownership and the sharing and business information raises no competition 
concerns, but the ICANN community (with no subject matter expertise in this 
area) disagrees and can't make up its mind in 18 months?  Your proposal  would 
block that party from increasing beyond 15% just because the ICANN community 
says so, notwithstanding the experts have already determined that there is no 
problem, correct?

JJN - There are lots of decisions made by the ICANN community that may or may 
not have been made by a competition authority.  While I believe it is a factor 
for the ICANN community to consider, there are many other factors that we have 
been examining which are not necessarily factors that a competition authority 
would even look at.

Question #2: When does the 18 month clock start ticking (approval of the 
policy, submission of application, signing of contract with ICANN, entry into 
the root, first domain name entered into the zone, soft launch, general 
commercial launch)? For example the application review process will likely take 
at least 12 month even without any string contention. There will then be 
contractual negotiations and pre-delegation sign off, this should be an 
additional 3-6 months. I think the current registry agreement requires the TLD 
to be in the root 12 months after signing. Would it be possible to apply and 
agree to the 15% limit as part of the application and then for an applicant 
prior to going live to seek an amendment.  Without providing any context on the 
criteria that will be applicable in connection with approving waivers in excess 
of 15% seems like a very profitable gaming scenarios for ICANN consultants. 
While that may be extremely lucrative for people like Jon and I, I think the 
business community should expect a little more predictability in the process if 
we want true innovation and choice.

JJN - My answer is that it would be upon signing of the agreement especially in 
the case of the Orphan TLD.  The point is that good faith efforts should be 
undertaken and that would not be realistic if prior to approval and signing an 
agreement.

If you could proactively address these questions during today's call I would 
greatly appreciate it.

Best regards,

Michael




From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On 
Behalf Of Jon Nevett
Sent: Monday, April 26, 2010 10:53 AM
To: Gnso-vi-feb10@xxxxxxxxx
Cc: Jon Nevett; Jeff Neuman
Subject: [gnso-vi-feb10] Merged Proposal

VI WG Colleagues:

Please see the attached proposal.  The good news is that Jeff Neuman and I have 
been able to merge our proposals, thereby removing two proposals and replacing 
them with only one.  The bad news is that it is another document for everyone 
to review.  If possible, we would like to discuss our merged proposal on our 
call today.  We are calling it the JN Squared proposal, but are open to new 
names with new supporters!

For those who don't have time to review the attached before the call, here are 
the highlights:

1.   CROSS OWNERSHIP LIMIT.  Initial cross ownership limit is 15%, or in any 
situation where control is exercised (i.e. power to direct management or 
policies)
2.   EXCEPTIONS.  For Single Registrant,  Community and Orphan TLDs
3.   REVIEW.  After 18 months Registry can obtain increase above 15% if ICANN 
community supports new criteria
4.   TLD SPECIFIC.  Limits only apply if registry and registrar offer the same 
TLD  (e.g. if registrar is not accredited in registry's TLD there is no limit 
on cross ownership)
5.   USE OF REGISTRARS.  Registry Operator may select registrars based on 
objective criteria and may not discriminate among the ones they select
5.   REGISTRAR RESELLERS.   CO limitations extended to registrar resellers for 
18 months.  After that, market protections mechanisms must be in place
6.   BACK-END REGISTRY OPERATORS.  CO limits apply to back-end registries that 
control pricing or policies; others that do not must maintain market protection 
mechanisms

Thanks.

Best,

Jon and Jeff