Network Solutions' Comments
Network Solutions agrees that the Memorandum of Understanding (MoU) between ICANN and the U.S. Department of Commerce should be renewed and modified. A great deal of work still is needed regarding how ICANN operates and its commitment to fulfill its core principles before it is ready to reach full privatization. To this end, Network Solutions offers the following comments and recommendations for action. Bottom-up representation, participation, and transparency are core values to which ICANN is obligated to comply under the terms of the MoU and its Bylaws. Effective involvement of all Internet stakeholders requires not only that their comments be solicited, but also that ICANN consider those comments as part of a transparent decision-making process. It is often difficult to determine what information ICANN Board members considered in making a decision. Recent examples of ICANN's failure to meet these obligations include approving the proposed .com Agreement despite broad-based opposition; approving the final .net Agreement without public review; ignoring the Generic Names Supporting Organization's (GNSO's) recommended Bylaw change to require public review of material contracts prior to execution; and creating policy though contract negotiations, thereby circumventing the established policy making process. To remedy such shortcomings, ICANN should: * Implement and comply with certain basic decision-making procedures, including public deliberations, the disclosure of staff advice to the ICANN Board, and timely publication of complete minutes of Board meetings. ICANN's decisions also should include an analytical component that explains how comments were factored into a decision. * Amend the ICANN Bylaws to require publication of all material contracts for comment before approval. * ICANN also should not use renewals of registry agreements to effectuate policy changes that would circumvent policy review by the GNSO. Accountability and oversight are important components to ICANN's reaching full corporate maturity. Structures like the Office of the Ombudsman and the existing review procedures alone are insufficient. Indeed, all of the review mechanisms are just mechanisms to advise the Board. There should be an equivalent of a shareholder's ability to overturn a Board decision or to take action, as is the case with a public corporation in the United States. The ICANN Board's voting record, and lack of dissenting votes, calls into question its ability to act independently of Staff recommendations. New mechanisms - such as super-majority votes - are needed to ensure accountability. Also, a viable Reconsideration Policy and an Independent Review Policy (IRP) could serve as effective counterweights to the substantial deference typically given by the Board to Staff decisions. They also would provide a check on Board decisions, such as those made in violation of ICANN policies or without broad Internet community support. Thus, ICANN should: * Require supermajority votes for important Board decisions and provide a vehicle for the overriding Board decisions (e.g. Board decisions could be vetoed by a super-majority of Supporting Organizations.) * Improve the existing Reconsideration and IRP processes to provide a realistic vehicle for challenging Board decisions. Reconsideration should be more than a procedural review, and the IRP should be more than an advisory opinion to the Board. Similarly, adequate budget oversight is a critical component to ICANN's self-governance capabilities. Budgetary oversight - including through external review - should be increasing, not decreasing (as it would if the proposed .com contract is approved). Such a function also should be shared with more members of the community, not just registrars. Additionally, there should be more linkage between ICANN's Strategic Plan and the budgetary process, so funding is taken into account when determining future plans. To address these concerns, ICANN should: * Conduct and release the results of audited financial reports of ICANN's management of its financial resources. * ICANN should reconstitute a constituency-based Budget Working Group, which would have more than advisory power and could replace the current system of registrar fee approval. * Provide a closer link between the Strategic Plan and the budget process, i.e. Staff should calculate costs and funding mechanisms at the same time as determining goals and ideals for the future. Under the MoU and pursuant to its Bylaws, one of ICANN's core values is to promote competition. ICANN's ability to foster the checks and balances of a competitive marketplace should be an integral component of ensuring that technological safeguards are in place to preserve the stability and security of DNS operations. It is telling that the President's Strategy Committee never mentions the word "competition" in its consultation request. Perhaps this is because while ICANN was successful in bringing competition to the registrar space, it has failed to bring any real level of competition to the registry space. By including auto-renewal clauses and limiting its termination rights in recent and pending gTLD agreements, and failing to employ its greatly expanded budget to police bad actors and predatory practices in the domain name space, ICANN is discouraging competition and failing to ensure stability and security. To this end, ICANN should take the following steps: * Ensure competition is brought to the registry space. This would include a presumption against automatic renewal terms in registry contracts that remove ICANN's ability to seek competitive bids at a future date, especially in the face of demonstrated "bad behavior." * Seek review and evaluation of changes to registry agreements by the Department of Justice's Antitrust Division to ensure that competition values are maintained. * Take a proactive role in compliance efforts to limit abuses, particularly in light of the budgetary resources allocated in this area and ICANN's claim that with a larger budget it could address these abuses. Thank you for the opportunity to provide these comments. Implementing the recommendations above would help ICANN to be in a position to reach full corporate maturity and privatization.