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RE: [gnso-vi-feb10] Board resolution on Vertical Integration

  • To: Stéphane Van Gelder <stephane.vangelder@xxxxxxxxx>, "Avri Doria" <avri@xxxxxxx>
  • Subject: RE: [gnso-vi-feb10] Board resolution on Vertical Integration
  • From: "Hammock, Statton" <shammock@xxxxxxxxxxxxxxxxxxxx>
  • Date: Mon, 27 Sep 2010 08:38:23 -0400

Following on the comments of Avri and Stephane, I would suggest that the WG 
start looking seriously at the JN2 proposal for a consensus position.  It's 
neither a "Free Trade" position nor a strict separation position but rather 
contains important concepts that allow new players in the market, provides for 
the allowance of greater than 15% interest and control in certain cases, and 
allow for some flexibility going forward (e.g. after the first 18 months, ICANN 
may amend the controlling interest provision with consensus approval). I think 
of all the proposals discussed, this one comes closest to what the GAC has 
suggested and it's also the one that has the most chance of getting rough 


-----Original Message-----
From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On 
Behalf Of Stéphane Van Gelder
Sent: Monday, September 27, 2010 3:50 AM
To: Avri Doria
Cc: vertical integration wg
Subject: Re: [gnso-vi-feb10] Board resolution on Vertical Integration

Well done for pointing this out Avri.

I think the GAC letter provides some useful insight into what a kind of 
consensus solution from this group might look like:

Absent market power, registrars should be allowed to "enter the domain name 
market". They have "valuable technical, commercial and relevant local 
expertise" to offer.

The GAC also recognize that allowing registrars to be able to provide 
registry-support services to applicants would increase their options in terms 
of finding partners with the required knowhow to aid them in building their TLD 

It is clear that, at this stage, the full VI solution is not something that is 
acceptable to most people. But neither is the full separation solution.

I'm hoping the group can take that on-board as it searches for some kind of 
consensus over the next few days.


Le 27 sept. 2010 à 03:34, Avri Doria a écrit :

> On 26 Sep 2010, at 21:10, Mike O'Connor wrote:
>> -- the proposals -- we're about evenly divided in thirds between JN2, Free 
>> Trade and RACK+, is there a way to consolidate them into something that can 
>> be described as rough consensus?
> We might also want to think about this in light of what the GAC said in their 
> letter to the Board as quoted by Eric:
>> Begin quote:
>> Registry-registrar separation
>> The GAC notes the significant work being done within the ICANN community to 
>> resolve the difficult issue of registry-registrar separation. The GAC looks 
>> forward to further discussion of this important issue.
>> The GAC notes that CANN has incorporated strict rules in version 4 of the 
>> DAG under which registrars are not able to provide registry services or to 
>> operate a new gTLD. Governments generally support restrictions on vertical 
>> integration and cross-ownership as important devices for promoting 
>> competition, preventing market dominance and averting market distortions. 
>> The GAC notes in this regard the Salop
>> and Wright report and recognizes that vertical separation may be warranted 
>> where a market participant wields, or may in the future wield, market power.
>> However, the GAC also recognises that if market power is not an issue, the 
>> ability of registrars with valuable technical, commercial and relevant local 
>> expertise and experience to enter the domain names market could likely lead 
>> to benefits in terms of enhancing competition and promoting innovation.
>> An important additional benefit which the GAC expects would flow from such 
>> an exemption would be that community-based TLD applicants would be able to 
>> cast their net more widely in securing partners with the necessary expertise 
>> and experience in the local market to undertake what would be relatively 
>> small scale registry functions.
>> The GAC therefore urges ICANN to resolve the current debate about 
>> registry-registrar separation with a solution that fosters competition and 
>> innovation in the DNS market by allowing exemptions, subject to some form of 
>> regulatory probity that ensures a
>> level playing field, for certain registrars as potentially valuable 
>> newcomers to the registry market. ICANN may find it useful to consider the 
>> experience of competition regulators around the world in addressing this 
>> issue.
>> End quote.

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