RE: [gnso-vi-feb10] vertical relationships in the domain name mkt
- To: "Milton L Mueller" <mueller@xxxxxxx>, "Jothan Frakes" <jothan@xxxxxxxxx>, <vgreimann@xxxxxxxxxxxxxxx>
- Subject: RE: [gnso-vi-feb10] vertical relationships in the domain name mkt
- From: "Hammock, Statton" <shammock@xxxxxxxxxxxxxxxxxxxx>
- Date: Thu, 8 Jul 2010 08:21:25 -0400
Thank you Milton for using the cereal analogy. I think it's a good one
and we all should stop and consider what usually happens in "real life"
or ("business life," whatever) when we think about and discuss aspects
of selling and distributing new gTLDs.
Sr. Director, Law, Policy & Business Affairs
P 703-668-5515 M 703-624-5031 www.networksolutions.com
[mailto:owner-gnso-vi-feb10@xxxxxxxxx] On Behalf Of Milton L Mueller
Sent: Thursday, July 08, 2010 12:28 AM
To: Jothan Frakes; vgreimann@xxxxxxxxxxxxxxx
Subject: [gnso-vi-feb10] vertical relationships in the domain name mkt
Response to Jothan:
OK, now to focus on the response.
**** 1] What I am saying is that this 'not in your own TLD' exception
is essentially the same as 100%.
I am beginning to find this argument persuasive. But you can also see,
do you not, that this argument applies just as strongly to arbitrary
ownership limitations, doesn't it? In other words if you can't enforce
"not in your own TLD" you also can't enforce some specific ownership
limitation such as 15%. Q.E.D.
**** 3] What I am saying it is *not* in the public interest if GoDaddy
(or Key-Systems or swap in any other respected registrar) is *not* able
to sell .WEB names. It would be, however, in the interest of the .COM
operator if .WEB is competitively restrained in that way. Of course,
VeriSign hasn't officially taken any stance on VI yet -- but as they
know big registrars want TLDs my hunch is they'll come out in favor of
JN2. No criticism of them there - it would be in VeriSign's corporate
interest to see new TLDs competitively restrained in that manner.
We keep talking as if this were a unique problem to the domain name
industry. It isn't. Think of grocery stores (let's say, Wegmans). A
major grocery chain such as Wegmans will sell numerous branded food
products (e.g., breakfast cereals) such as Cheerios and Chex. It may
also sell its own in-house brand (say, the Wegman's version of
General Mills may choose to withhold Cheerios from Wegman's because
Wegman's sells its own, competing version of breakfast cereal. Or it may
not. Conversely, Wegman's may choose not to carry Cheerios because they
"undermine" the market for its own in-house cereal. Or it may not.
What we find in reality is that in most cases a big grocery chain will
carry a lot of brands and its own brands both. It profits more from
serving a larger market. But many, many smaller ones don't have their
own brands and serve as pure retail intermediaries. And in a very few
specialized cases, a purely vertically integrated food suppliers may
carry nothing but their own brands.
These are business choices. As long as the market for breakfast cereals
and grocery stores is reasonably competitive, no centralized regulator
needs to dictate which of these choices market players make, nor do
consumers need them to make those choices for them. Same is true of the
So you haven't made a public interest case for your position. You are
not thinking about what leads to the most competitive, robust and open
domain name industry. You are, instead, still thinking: "how can I as a
prospective registry operator use ICANN regulations to ensure that my
product is guaranteed shelf space in every grocery store."
I suggest you stop thinking about how to use ICANN to "guarantee" your
product this or that. I suggest that you, and everyone else, start
thinking about how to compete and produce value to consumers.
Let's not complicate the issue with two choices that are so similar as
to be the same thing. Let's just call this 'not in your own TLD'
exception what it really is --- Free Trade -- and one can continue to
eloquently argue for the Free Trade choice.
That's pretty much the direction I'm headed