RE: [gnso-vi-feb10] "Not in your own TLD" = lipstick on a pig

["Roberto Gaetano" <roberto@xxxxxxxxx>]

I would go for building a complete list of harms, regardless the impact of
integration/separation, in "brainstorming mode".
Once the list is finalized (deadline?) we can start defining for each one
what is the extent of the harm and all other parameters, and the impact that
integration/separation will have in increasing or reducing the harm. If we
find that there are harms for which VI/VS is irrelevant, they will be out of
the scope of this WG, but possibly still an input for another process, as
Ron points out.
R.



> -----Original Message-----
> From: owner-gnso-vi-feb10@xxxxxxxxx 
> [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On Behalf Of Ron Andruff
> Sent: Monday, 23 August 2010 23:41
> To: Gnso-vi-feb10@xxxxxxxxx
> Subject: RE: [gnso-vi-feb10] "Not in your own TLD" = lipstick on a pig
> 
> 
> Volker and all,
> 
> Volker wrote: I still hold the opinion that each and every 
> one of these harms can just as easily occur with full 
> vertical seperation. A registry may simply conspire with an 
> independant registrar to abuse their combined power in a 100% 
> identical manner, sharing the profits between them. The 
> solution to address the harms therefore cannot be not 
> vertical seperation, but policy building, defining possible 
> harms and addressing them with sensible precautions.
> 
> This is exactly what you and I discussed, together with J-C, 
> in Brussels and all three of us agreed that policies and 
> strong penalties need to be developed and implemented to 
> solve the problems that are being exposed.  You
> could not be more correct.   Who of us believes that Internet 
> users at-large
> should be subjected to the long list of unfair practices that 
> is emerging?
> Hopefully, no one on this WG!
> 
> In doing this 'harms exercise', what is becoming clearer by 
> the day is the fact that more policy development is needed to 
> sew up all of the loopholes irrespective of VI...  This WG's 
> efforts could -- and should -- be the start of that 
> undertaking.  But ALL harms must be addressed!
> 
> Therefore, I think the discussion about whether a harm can 
> occur with or without VI needs to be repositioned to say: the 
> VI WG is going to define ALL of the harms that occur today 
> and determine policy recommendations for how to overcome 
> those harms in relation to VI.  Addressing the harms that 
> stand outside of the VI discussion can -- and should -- be 
> the subject of a separate PDP.
> 
> In my view, we should refrain from making any distinction 
> between the harms that affect VI and those that do not.  
> Separate lists can be draw up, but ultimately ALL of the 
> harms that the ICANN community is aware of need to be addressed.  
> 
> This WG is taking the first step in that direction.
> 
> Kind regards,
> 
> RA
> 
> Ronald N. Andruff
> RNA Partners, Inc.
> 
> 
>  
> 
> 
> -----Original Message-----
> From: owner-gnso-vi-feb10@xxxxxxxxx 
> [mailto:owner-gnso-vi-feb10@xxxxxxxxx]
> On Behalf Of Volker Greimann
> Sent: Friday, August 20, 2010 11:25 AM
> To: Jothan Frakes
> Cc: Gnso-vi-feb10@xxxxxxxxx
> Subject: Re: [gnso-vi-feb10] "Not in your own TLD" = lipstick on a pig
> 
> 
>   Hi Jothan,
> 
> > All said, I have been pretty consistent about expressing 
> that a 'Not 
> > in your own TLD' will be problematic.
> I am not happy either with the "not in your TLD"-rule for the 
> opposite reason, but it is a rule I can live with. Ideally, 
> no such restriction will be required.
> 
> I disagree with your view that such a rule will necessarily 
> be window dressing. Effectively, it will come down to 
> compliance enforcement. Any policy we suggest will have to be 
> enforced eventually. An unenforced policy or a rule without 
> policy  _would_ be window dressing.
> 
> You make valid points on how this rule may be circumvented, 
> all of which could however be excluded in the final ICANN 
> agreements, resulting in stiff penalties for violations. Any 
> rule we set up, would necessarily have to be "clothed" in 
> contractual language to that effect.
> > As I look at some of the stated harms that could occur if a 
> registrar 
> > becomes a registry, it seems to me almost all of them can 
> still occur 
> > in the presence of a rule  to prevent the registrar from 
> 'selling' its 
> > own TLD:
> >
> I still hold the opinion that each and every one of these 
> harms can just as easily occur with full vertical seperation. 
> A registry may simply conspire with an independant registrar 
> to abuse their combined power in a 100% identical manner, 
> sharing the profits between them. The solution to address the 
> harms therefore cannot be not vertical seperation, but policy 
> building, defining possible harms and addressing them with 
> sensible precautions.
> > By way of example, let's say registrar 'A' operates the 
> registry for 
> > .WEB and registrar 'B' operates the registry for .INC.  
> Here are just 
> > a few examples how harms could occur even though the cross owned 
> > registrar  does not sell the TLD:
> >
> > a)    Registries often have play trusted role as a 'judge' between
> > conflicting registrars.  The registry often is in the 
> position to be 
> > the fail-safe point for registrar bad actions.
> Interesting point. In my experience most gTLD registries 
> currently take a hands-off approach regarding conflicts 
> between registrants and registrars, i.e. letting parties work 
> it out between themselves according to ICANN policies. I 
> agree, registries can take up that role, but effectively, I 
> have not seen them do so.
> >   'A' would ALWAYS decide .WEB TDRPs in favor of 'B' and 'B' would 
> > ALWAYS decide .INC TDRPs in favor of 'A'.
> You are assuming registrars and registries operate outside 
> the scope of the law. Any decision taken by a registrar can 
> be contested in court if the decision is found to be injust 
> by the registrant.I have a hard time seeing your example 
> become reality, and even in the case it did, registrants or 
> other registrars would always have possible recourse via 
> ICANN compliance and the law.
> > b)    A similar issue might emerge within handling of UDRP/ URS.
> >
> > 'A' and 'B' COULD conceivably agree to a reciprocal deal in 
> which they 
> > thwarted UDRP judgments in each others TLD (for example -  via the 
> > geographic location of an owned registrar  as described in first 
> > reference posting above).
> Actually, from what I heard from WIPO, there seems to be 
> registrars doing that all on their own already. No vertical 
> integration necessary for that harm. Anyway, a patter would 
> soon develop that could be tracked by the UDRP service 
> providers and then brought to ICANN in form of an 
> investigation request. It is evident to the UDRP providers if 
> a registrar subverts their decision, as the winning party 
> will likely complain resulting in compliance action.
> 
> > c)    Non-discriminatory treatment of registrars can and has be
> > thwarted by discrete reciprocal marketing deals - e.g. 'A' 
> gives 'B' a 
> > preferential deal on .WEB names if 'B' gives 'A' a 
> preferential deal 
> > on .INC names.
> >
> > It can also be thwarted by registrars concealing their ownership of 
> > resellers in that TLD - e.g.  it will be extremely 
> difficult, if not 
> > impossible, to detect that registrar A owns resellers of .WEB names.
> Such deals would be direct violations of the equal access 
> provisions and dealt with accordingly. I admit, such deals 
> may be hard to follow up on, but the same case would exists 
> when a registry would offer such favored conditions to a 
> vertically seperated registrar for special consideration.
> 
> Your second point could also be used to violate any 
> co-ownership limitations, i.e. a registrar concealing their 
> ownership of a registry. 
> It would therefore be _just as "difficult, if not impossible, 
> to detect that registrar A owns" the registry "of .WEB 
> names"_. Taking the essence of your argument at face value, 
> is it not also an argument that the 15% limitation proposed 
> "on the RACK" is also just window-dressing?
> 
> You are assuming an almost criminal intent to violate the a 
> provision, which should in my view immediately lead to the 
> deaccreditation or suspension of the registrar. Any provision 
> can be circumvented and the rules need to reflect that and 
> have checks and penalties in place to react properly.
> 
> > d)    Tasting/ Front Running -   As it sees all check commands in
> > .WEB,  registrar 'A' can taste or front run this second 
> level string 
> > in other TLDs (on the premise that a registrant who is 
> interested in 
> > the string in .WEB might also be interested in the string in other 
> > TLDs).
> The registry intent on violating their obligations may just 
> as likely sell the same data to interested registrars, 
> resellers of registrars, domainers, anyone really, for a 
> kickback on the profits. Why is this an argument against VI 
> or "not in your own TLD"? Any registrar interested in the 
> long haul will not act this way as it will come out 
> eventually, and it will lose them their credibility with its 
> customer base, not to speak of the contractual penalties such 
> behavior should evoke.
> > Beyond these, I think it is possible to go through nearly 
> every harm 
> > we will list in the 'harms' documents, and narrate a reasonable or 
> > existing scenario that shows a 'not in my TLD' exception does not 
> > serve to mitigate the harm.
> Likewise I can go through each and every harm on the list and 
> show you how it is just as possible, just as likely to happen 
> with full separation in place.
> > I understand some of these harms can also be caused by contractual 
> > relationships,  rather than by cross ownership.
> Exactly.
> > There is an order of magnitude greater likelihood the harms 
> will occur 
> > from bad actors in a fully cross-owned environment where control 
> > between registry and registrar is absolute (and not simply by
> > contract).    If one owns an asset, one inevitably has more control
> > over how it is used.  One would also have greater control over how 
> > transparent or opaque its activities are to other parties.  
> I am not 
> > suggesting that any actors who support 100% cross ownership are 
> > proposing anything in order to game a system nor that such an 
> > ownership is completely problematic.
> I do not agree with this statement. The likelyhood does not 
> increase or decrease with vertical integration. It may be 
> slightly easier to set up with a vertically integrated 
> registrar, but in the end the possibilities for abuse are the 
> same. I am not suggesting that any actors who support 100% or 
> 85% separation without any further controls are proposing 
> anything in order to game a system, of course.
> > My point is that 'not in your own TLD' is essentially the same pig, 
> > but with lipstick on.
> The same however can be said for any other proposal, from the 
> board decision of no separation via the 15% ownership limit 
> of RACK. Once we accept the fact that the only difference 
> between vertical integration and separation is the likelyhood 
> of abuse, every suggestion becomes lipstick on a pig if it 
> does not address the harms and proposes a general rule.
> 
>  From the start of this WG, Key-Systems has favored an open 
> approach allowing full 100% integration, as such an approach 
> will force all to contribute to building the rules to prevent 
> the abuse, make it harder, and punish the abusers, instead of 
> reducing the likelyhood from, say 25% to 20%. Simply reducing 
> the likelyhood by a few percentage points will be insufficient.
> 
> We have learned in the realm of ccTLDs that VI is not only 
> possible, but often in the best interest of the consumer. .de 
> domains just as .at domains are not deleted when they expire, 
> they go to the fully integrated registrar instead, allowing 
> the registrant one further opportunity to recover their 
> domain. In fact, the more open a registry was in any respect, 
> the more successfull the TLD has become.
> > The IPC, I think said it well here --   (...)
> The IPC, with all due respect cares nothing for the well and 
> being of new TLDs. They are interested in the IPC and its 
> members. The more restrictive the policy, the better for 
> them. Even better would be no new gTLD as many IPC members 
> are on record of demanding for a long time.
> The IPC model basically states: "We want something for 
> ourselves which no one else can have. Others cannot be 
> trusted with vertical integration, but we - as brand owners - 
> can, because no brand owner would ever think of abusing their 
> customers or the general public."
> 
> >   PIR also said it well  - "The proposed experiments in the 
> Report do 
> > take account of the risks of self-dealing by registrars that own 
> > registries. The Report attempts to deal with these by proposing to 
> > prohibit registrars from offering registrations in a 
> registry that it 
> > owns. This would be totally ineffective; there are now almost 900 
> > ICANN accredited registrars.The identities of the real parties with 
> > interests in most of them are not public information. It 
> would be all 
> > too easy for (the owners of) registrars to create new shell 
> registrars 
> > to evade this prohibition by monopolizing or restricting access to 
> > registrations in the registry owned by the original 
> registrar. The end 
> > result would be a severe negative impact on competition among 
> > registries and among registrars.
> Their comment however forgets that the same possibility 
> exists for registrars or registries violating any ownership 
> limitation. A nominally fully vertically separated registry 
> (or registrar) may just as well set up a set of shell 
> companies "to evade this possiblility by monopolizing or 
> restricting access to registrations in the registry". Is 
> their conclusion therefore that we should have no new gTLDs? 
> No, they just use the basic argument for part of the point it 
> really makes.
> 
> With an open approach on the other hand, there would be no 
> incentive to hide your affiliation, no need to hide your ownership.
> > As we assess the various harms I believe we need to be 
> aware that the 
> > 'as long as its not in my own TLD' exception will not 
> really mitigate 
> > any of the harms but rather has the potential to spawn a myriad of 
> > complex and opaque back room deals to route around them.
> The same goes for any form of vertical separation, of course.
> > I remain convinced that it is a bad idea to place a 'not in 
> your own 
> > TLD' restriction in place in the presence of any % of 
> ownership (and I 
> > am not suggesting opposition to any % of ownership - just a silly
> > rule) that the board in its wisdom would grant in the final 
> applicant 
> > guidebook this year.
> Concluding, I fully agree that any % of ownership limitation 
> is a silly rule given the opportunities to circumvent or obfuscate it.
> 
> Best regards,
> 
> Volker