Re: [gnso-vi-feb10] vertical relationships in the domain name mkt

[Avri Doria <avri@xxxxxxx>]

Hi,

I still interpret that (and did when i voted for it) as meaning that if a 
Registry uses Registrars, you must use ICANN Registrars and must provide all of 
them with equal access.

a.

On 8 Jul 2010, at 11:23, Jon Nevett wrote:

> We now have come full circle back to Recommendation 19 where the GNSO policy 
> recommendation requires the use of registrars in the domain name registration 
> process for all of the reasons articulated on this list in the March/April 
> timeframe.  Some folks seem to champion the bottom-up policy development 
> process in all cases except those in which it has succeeded in coming up with 
> a policy with which they disagree!  
> 
> 
> On Jul 8, 2010, at 10:59 AM, Milton L Mueller wrote:
> 
>> Jeff,
>> I am puzzled by this comment. You say “we would also have to ask whether 
>> there should ever be a requirement to use ICANN-accredited registrars.” That 
>> is precisely the question I am asking. The answer I and other CAM supporters 
>> have provided to that question is pretty simple and clear: there should be 
>> no such requirement for new TLDs unless there is a compelling competition 
>> policy/market power or consumer protection justification.
>>  
>> As for other real-world cases, there are examples where vertical separation 
>> is required. Unbundled local loop for facilities based telecom providers in 
>> Europe and Canada comes to mind. But this is based – as it should be – on 
>> the presence of monopoly power over the first mile facility. There is no 
>> such constraint for new TLDs, therefore it’s hard to justify a vertical 
>> separation requirement.
>>  
>> I have cited this example many times, so I am not using the real world 
>> selectively. I happen to have been involved in regulatory economics in 
>> telecoms for 25 years and can supply many real world examples if you like.  
>>  
>> --MM
>>  
>> From: Neuman, Jeff [mailto:Jeff.Neuman@xxxxxxxxxx] 
>> Sent: Thursday, July 08, 2010 8:54 AM
>> To: Hammock, Statton; Milton L Mueller; Jothan Frakes; 
>> vgreimann@xxxxxxxxxxxxxxx
>> Cc: Gnso-vi-feb10@xxxxxxxxx
>> Subject: RE: [gnso-vi-feb10] vertical relationships in the domain name mkt
>>  
>> Statton & Milton,
>>  
>> If we were to consider the “real world”, then we would also have to ask the 
>> question as to whether there should ever be a requirement to use 
>> ICANN-Accredited Registrars in the first place.  In the real world an entity 
>> can choose whether or not to have resellers, and if it does choose to have 
>> resellers, it can treat them all differently as it sees fit.  There is no 
>> concept of equal access among resellers.  In fact, how many of the 
>> registrars on this list either choose to have resellers (or not) and if you 
>> do choose to have them, how many of them choose to treat all of their 
>> resellers equally.
>>  
>> So while I like looking to the real world for some examples, if we are using 
>> the “real world” as our guide, we cannot pick and choose which parts of the 
>> real world we like and which we do not and choose to only apply the ones we 
>> like.  By definition, that takes us back out of the real world and back into 
>> ICANN land.
>>  
>>  
>>  
>> Jeffrey J. Neuman 
>> Neustar, Inc. / Vice President, Law & Policy
>> 
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>>  
>> From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] 
>> On Behalf Of Hammock, Statton
>> Sent: Thursday, July 08, 2010 8:21 AM
>> To: Milton L Mueller; Jothan Frakes; vgreimann@xxxxxxxxxxxxxxx
>> Cc: Gnso-vi-feb10@xxxxxxxxx
>> Subject: RE: [gnso-vi-feb10] vertical relationships in the domain name mkt
>>  
>> 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. 
>>  
>> Statton  
>>  
>>  Statton Hammock 
>>  Sr. Director, Law, Policy & Business Affairs
>> 
>> P 703-668-5515  M 703-624-5031www.networksolutions.com
>>  
>> From: owner-gnso-vi-feb10@xxxxxxxxx [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
>> Cc: Gnso-vi-feb10@xxxxxxxxx
>> 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 Cheerios).
>>  
>> 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 DNS market.
>>  
>> 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
>> 
>> --MM
>> 
>>  
>> 
>>  
>