RE: [gnso-vi-feb10] Orphans, existance and exploitation of

[Milton L Mueller <mueller@xxxxxxx>]

Not quite true. Registrant lock-in is a form of market power and has been a 
recognized factor in the analysis of domain name market since the very first 
FTC assessment commissioned by the Commerce Department in 1998. However, that 
analysis involved existing, well-established TLDs (.com, etc.). For new TLDs, 
registrant lock-in can be overcome not only through registrar separation and 
equivalent access, but also through long-term contracts (indefinite, 10+ years) 
and/or notification requirements. 

> -----Original Message-----
> 
> No one has also provided a rationale for requiring the use of registrars
> or equal access to registrars absent market power either as presumably
> the protections that supposedly kick in on equal access are only needed
> when market power exists.  So, that should be back on the table as well.
> 
> Jeffrey J. Neuman
> Neustar, Inc. / Vice President, Law & Policy
> 
> 
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> -----Original Message-----
> From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-
> feb10@xxxxxxxxx] On Behalf Of Milton L Mueller
> Sent: Monday, May 03, 2010 1:52 PM
> To: 'Kathy Kleiman'
> Cc: Gnso-vi-feb10@xxxxxxxxx
> Subject: RE: [gnso-vi-feb10] Orphans, existance and exploitation of
> 
> 
> Kathy
> The problem with the orphan exception is that it has got the problem
> exactly backwards. It imposes restrictions upon new entrants and lifts
> those restrictions only AFTER they are teetering on the brink of
> failure.
> 
> As our conversation with the antitrust economists made clear, CO and
> self-distribution among new TLD applicants should be _presumed legal_,
> and restrictions imposed only if or and when a certain level of market
> power is reached.
> 
> No one has ever provided a plausible rationale for what these initial
> restrictions are protecting us against when the new gTLD has no market
> power. All of the arguments (e.g., "co-mingled data") presume that the
> TLD in question is well-established and in high demand and multiple
> registrars are competing for access to it. That will not be the case for
> most new TLDs.
> 
> > -----Original Message-----
> > From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-
> > feb10@xxxxxxxxx] On Behalf Of Kathy Kleiman
> > Sent: Monday, May 03, 2010 12:14 PM
> > To: Eric Brunner-Williams
> > Cc: Gnso-vi-feb10@xxxxxxxxx
> > Subject: RE: [gnso-vi-feb10] Orphans, existance and exploitation of
> >
> >
> > Hi Eric,
> > Tx for your question. You are, of course, talking about the gaming of
> > the exception, and not its intended purpose. But it's a fair question
> > nonetheless.
> >
> > The purpose of the orphan exception is to reflect problems we have
> > heard
> > -- that with so many new gTLDs, a small one may not be picked up by
> > registrars, and thus may not be distributed to its intended audience
> > (e.g., a small community, a developing country set of groups, etc.).
> >
> > It is not intended to provide a way for a gTLD Registry of a new .BLOG
> > or .WEB, for example, to keep their domain names to themselves and
> away
> > from the Equal Access provisions for registrars.
> >
> > So Eric, would the following restrictions protect against the problems
> > you raise?
> >
> > 1.  You can only get Orphan status if 3 or fewer registrars offer your
> > TLD --  at any point in time;
> >
> > 2.  You have to apply in writing to ICANN for Orphan status and there
> > is
> > a 30 day comment period before you can start operations with your own
> > registrar or directly (e.g., 30 days for ICANN-Accredited Registrars
> to
> > say "Yes, I want to offer this gTLD!"; and
> >
> > 3.  If, after you start your own registrar operations,  additional
> > registrars start offering your names (such that then more than 3
> > unaffiliated registrars are offering your TLD) -- then your own
> > affiliated registrar is limited to managing X thousand names (e.g.,
> > 30,000 or 50,000) -- at which time you must stop distributing your TLD
> > domain names entirely.
> >
> > Best,
> > Kathy
> > -----Original Message-----
> > From: owner-gnso-vi-feb10@xxxxxxxxx
> > [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On Behalf Of Eric
> > Brunner-Williams
> > Sent: Saturday, May 01, 2010 7:51 AM
> > To: Kathy Kleiman
> > Cc: Gnso-vi-feb10@xxxxxxxxx
> > Subject: [gnso-vi-feb10] Orphans, existance and exploitation of
> >
> >
> > Kathy,
> >
> > Am I correct in understanding the "orphan" status?
> >
> > Suppose Registrar X has a standing offer to every new gTLD registry
> > applicant. For those applicants which garner no other offer, X is
> > guaranteed 50,000 transactions at a margin it sets.
> >
> > X could set the price at 10x the registry price, prompting the
> > registry to pay greenmail to get "orphan" status, and sell its
> > inventory at the registry price, or fail.
> >
> > If the first 50k names are going to be generics and trademarks and so
> > on, at sunrise and land rush pricing, will any applicant obtain
> > "orphan" status before that inventory is exhausted?
> >
> > Thanks in advance,
> > Eric
> >
> > ------------------
> >
> > Kathy Kleiman
> > Director of Policy
> > .ORG The Public Interest Registry
> > Direct: +1 703 889-5756  Mobile: +1 703 371-6846
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