RE: [gnso-vi-feb10] Competition authorities

[Jeff Eckhaus <eckhaus@xxxxxxxxxxxxxxx>]

I have to agree with Roberto here that I do not see what the issue is here. 
This group is supposed to be looking at Co-ownership and Vertical Integration 
and the potential impacts of any recommendations on any affected parties. Is 
this now going to include profit margins and cost accounting? What happens if 
the affected parties like Registries lose money, should we have a relief fund 
for them as well ? 


The point below starts to reach into what companies charge and how they use 
their margins. If there are legitimate concerns about data sharing as Roberto 
says lets address those. 


Not sure why does it matter to this group if Yahoo has to pay $6 or $.05 for a 
domain? Still trying to figure out why these are issues that people feel need 
to be addressed at this time. 


Jeff Eckhaus




-----Original Message-----
From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On 
Behalf Of Richard Tindal
Sent: Tuesday, April 27, 2010 6:35 AM
To: Roberto Gaetano; Gnso-vi-feb10@xxxxxxxxx
Subject: Re: [gnso-vi-feb10] Competition authorities


Hi Roberto,

Not sure I understand your point in the context of resellers.

In my example,  Yahoo is the Registry,  Tucows (say) is the registrar, and 
Yahoo is the reseller.

Tucows is completely independent in all ways from Yahoo  (ownership, 
operations, finances).  There are no sham transactions.

Yahoo the reseller sells a .WEB name to a retail customer.   It then provides 
$6.05 to Tucows the registrar.   Tucows the registrar then pays $6.00 (the 
wholesale price) to Yahoo the registry.  When the dust has settled the 
incremental cost to Yahoo for this transaction is $.05.    As a retail player 
(via its reseller arm) Yahoo's cost has been $.05 yet it competes with 
unaffiliated registrars (e.g.  Register.com) whose cost is $6.00 per name.

The reason JN2 have included their reseller provision is that if you believe a 
registrar affiliated with the registry has an unfair advantage which may cause 
harms (which is the premise of many proposals to the WG)  then you should 
logically also believe that a reseller affiliated with the registry could cause 
those same harms.   

The CORE, Afilias, PIR and GoDaddy proposals all limit Yahoo's ability, in the 
example above, to own more than 15% of Tucows.  Yet by becoming a reseller 
Yahoo circumvents than limit.

RT



On Apr 27, 2010, at 7:36 AM, Roberto Gaetano wrote:

> 
> Please allow me to chime in with a consideration, coming from my
> recollection of previous discussions at the time of the NSI separation.
> If I remember correctly, one point made back then was not only about the
> operational separation in a Ry and Rr entity, but about a "full" separation.
> This means that in the books of the Rr the fee to be paid to the Ry has to
> be a real, not virtual, transaction. In other words, the revenue that the Rr
> will show in the books is, in the example made of a $6 cost and a $6.5
> price, just $.5, exactly as every other Rr, and the Rr would not be allowed
> to have any sort of subvention or other financial relationship with the Ry.
> If this is the case, and if it is enforced, it would seem to me that for the
> financial part there would be no difference whether the Ry and Rr have an
> ownership relationship, although this would still be a problem if we
> consider other relationships, like the access to Ry data by the Rr, which
> will put them at advantage.
> Regards,
> Roberto
> 
> 
>> -----Original Message-----
>> From: owner-gnso-vi-feb10@xxxxxxxxx 
>> [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On Behalf Of Richard Tindal
>> Sent: Tuesday, 27 April 2010 00:08
>> To: Eric Brunner-Williams; Gnso-vi-feb10@xxxxxxxxx
>> Subject: Re: [gnso-vi-feb10] Competition authorities
>> 
>> 
>> Yahoo could apply for a registry, as it is not 15%+ 
>> cross-owned by a registrar.
>> 
>> Yahoo could then become a reseller of its own TLD -- but this 
>> reseller would operate at a fraction of the per-name cost of 
>> the registrars with whom it competes.
>> 
>> RT
>> 
>> 
>> 
>> On Apr 26, 2010, at 5:58 PM, Eric Brunner-Williams wrote:
>> 
>>> Well, how does CORE's proposal allow Yahoo to run the 
>> nickle exploit?
>