In Response to mTLD's Proposal for the Allocation of One and Two Character .mobi's via Auction (Ticket ID: Z1H7J-5Y6X8)

[Andres Kello <andres@xxxxxxxxxxxxx>]

Dear ICANN,

My name is Andres Kello and I am the owner of the largest forum about .mobi
domain names -- Mobility.mobi -- and I also sat on both the dotMobi Policy
Advisory Board (PAB) and the now-defunct dotMobi Advisory Group (MAG)
Steering Committee.  I am also the Campaign Director of the largest
grassroots campaign for .mobi -- Why.mobi.

Two years ago, I sent a letter to ICANN (
http://forum.icann.org/lists/allocation-framework/msg00003.html) as a PAB
member in support of mTLD's proposal for the Allocation of one (and two)
character .mobi’s specifically via the Request For Proposal (RFP) framework:


~~~~~
“I would like to express my strong support for dotMobi's proposed allocation
of Single Character Second Level .mobi's via an RFP (Request for Proposal)
framework.”
-----

I went even farther in my letter of support and specifically mentioned how
the auction allocation method is detrimental to the extension and wrote:

~~~~~
"it would make sense for these highly-coveted domains to be granted to the
person or company with the absolute best development plan for it - as
determined by mTLD - in order to maximize their potential, rather than to
the company or individual with the biggest wallet - as determined by a
highest bid - who might not have the best intentions for the extension or is
purely speculating on the future value of the domain, particularly since
good content is critical for a young extension such as .mobi.  The only way
to ensure that for the SC SLD's is via the RFP framework."
-----

John Levine, also a member of the mTLD PAB at the time of the original
proposal, shared the same reasoning in his letter of support (
http://forum.icann.org/lists/allocation-framework/msg00005.html):

~~~~~
“It is important to allocate this important resource to entities that will
provide diverse and useful services to mobile users, rather than to
speculators as would likely happen were the names to be auctioned or issued
first-come-first-served. Hence I endorse the plan to allocate single letter
domains via an RFP process.”
-----

Michael J. O’Farrell, also an mTLD PAB member at the time, shared a similar
view (http://forum.icann.org/lists/allocation-framework/msg00006.html):

~~~~~
“the dotMobi registry RFP approach would be available to all stakeholder
communities versus an auction that could limit the availability of the
single-character second-level .mobi domain names to a few industry
speculators (who could potentially outbid the merits of made-for-mobile
Internet service delivery, utility and universal availability solely for
future speculative capital gain).”
-----

Vittorio Bertola, also an mTLD PAB member at the time, also shared a similar
view (http://forum.icann.org/lists/allocation-framework/msg00007.html):

~~~~~
“1) What is the allocation method that puts the reserved names to best use?

I think that it should be the method that best guarantees that all names are
developed, host useful services (as opposed to being used to host
pay-per-click advertising pages and nothing more) and become broadly used by
final users. To this purpose, auctions seem to me an inappropriate method:
they maximize the amount of money that can be squeezed out of the market,
but they do not offer any guarantee that the planned use of the domain name
is sound or, indeed, that the domain name will ever be used. This is even
more true in gTLDs that are community-based, where making money might not be
the primary purpose of the gTLD itself and of its second-level
registrations, and the richest registrants might not be the ones who could
actually develop services that are useful to the target community.”
-----

Even Caroline Greer, Director of Policy and Industry Relations of mTLD at
the time, shared a similar view (
http://forum.icann.org/lists/allocation-framework/msg00002.html):

~~~~~
“However, based on our experience and depending on the domains in question,
it is our belief that auctions do not always serve the needs of a particular
community and that certain domains are best allocated using a distribution
model such as the one dotMobi proposes for its single character domains - a
Request for Proposals [RFP] process.

dotMobi uses the RFP process in conjunction with its Premium Names to ensure
that its sponsored community has access to high quality content. The RFP
process for single character .mobi domains would be designed in a similar
way to ensure that new content, features and services are made available to
mobile Internet users and that the full potential of these domains is truly
recognized. dotMobi is not seeking to make any profit from this allocation
process, rather it desires to see these domains allocated to those that have
an interest in enabling mobile friendly content for the benefit of
end-users. “
-----

To be absolutely clear, I do not intend to speak for the individuals above,
and although the above quotes do not mean that their opinions have not
changed since they were made, it is my strong belief that the crux and basis
of the original opinions stated above at the time of the first proposal hold
true now more than ever, regardless.

It is not difficult to see why the Auction is counter-productive to the
growth of the .mobi ecosystem.  In fact, we don't have to look past the
previous auctions of Premium .mobi domains by mTLD.  A recent study on
Mobility.mobi showed an auction-to-development success rate of less than 10%
from 100 domains auctioned with Development Requirements via Sedo in 2008.
 This means that less than 10 out of the 100 domains auctions had any kind
of serious development.  The rest were nothing more than glorified parking
pages or bare-minimum developments just to stay “under the radar”.  This is
not surprising considering the majority of Premium Domain buyers were
speculators and not end-users.  I invite ICANN to check these facts for
themselves and thoroughly study the list of previously-auctioned Premium
.mobi domains to determine whether they sincerely consider the overall
developments beneficial to the .mobi ecosystem and community at large.

In light of the above, I was appalled to recently learn that mTLD have now
formally requested (
http://www.icann.org/en/registries/rsep/mobi-request-30sep10-en.pdf) that
ICANN allow them to allocate the one and two-character .mobi's via Auction
-- a method that has been proven to fail as far as the .mobi ecosystem is
concerned and as evidenced by the poor end-user uptake and development of
past Premium .mobi domain names allocated via auctions.  I would never have
supported that as a PAB member and I do not support it now.

In the interest of transparency and full disclosure, I myself own over 8
Premium .mobi domain names -- most acquired via the auction allocation
method and one acquired via the RFP allocation method -- so I believe I
speak with some authority when I describe the issues that have plagued the
auctioning of Premium .mobi domains and have a unique ability to compare and
contrast those shortcomings with the advantages of an RFP allocation method
since I am one of the very few who have witnessed it from both sides.  I can
also confirm that mTLD enforced no more than bare-minimum development
requirements when Premium Domains were allocated via auctions, whereas I had
to send my RFP application to them at least three times to satisfy their
criteria for thoroughness and detailedness of the development plan.  With
auctioned Premium .mobi domains, any site -- including a one-page site --
other than a strict parking page, was given a pass.  This included 5-page
mini-sites that would have taken less than 10 minutes to develop using a
.mobi site builder.  Furthermore, mTLD have failed to continue to enforce
even those weak standards set initially which has lead to several Premium
Domains that had gone “under the radar” in the past now becoming outright
parking pages -- this, on some of the most valuable, most searched-for, and
most sought-after .mobi domain names.  It is considerably more difficult for
this to happen with the .mobi’s allocated via the RFP method precisely
because a potential applicant must thoroughly prove their development plans
to mTLD before even being considered.  Anyone will be incredibly
hard-pressed to argue that an Auction allocation framework is better for the
.mobi ecosystem than an RFP allocation framework executed competently.

Perhaps the lack of any serious enforcement of the Developments Requirements
of auctioned Premium .mobi domains is due to the fact that it is difficult
to objectively categorize a development as sub-par “after the fact” without
running the risk of legal retaliation by the domain holders who would argue
the contrary.  This is yet another reason in favor of the RFP allocation
method, which allows mTLD to assess a development “before the fact” and thus
more-easily avoid being disappointed with the actual developments "after the
fact".  Simply put, Auctions attract speculators, whereas RFP’s attract
genuine end-users.  The main difference being, of course, that an end-user
will almost always have a business and development plan for the domain that
they need to complete those very plans, whereas a speculator will not (since
they are simply speculating on the value of the domain rising in the future)
and will simply create a quick site for the domains they have happened to
win just in order to "comply".  Even worse, speculators will often times win
domains they weren't even targeting simply because they seemed like a
“better deal” at the time of the actual auction.  All of this results in
improvised development plans which -- together with weak enforcements --
have led to a rotting .mobi ecosystem amongst Premium .mobi domains.  Does
ICANN truly wish to allow the same thing to happen with the shortest -- and
therefore most mobile-relevant -- .mobi domain names?

To be further transparent, I have never applied for an RFP to acquire a one
or two-character .mobi domain name nor do I have any intention of doing so
in the future, whether via RFP or auction.  I am speaking purely with the
interest of the .mobi ecosystem in mind.

As such, I would like to formally voice my strong objections to this latest
request by mTLD directly to ICANN, especially considering that mTLD saw "no
need to consult directly with other constituency groups" as per their
request form.

Sincerely yours,

Andres Kello
Mobility.mobi, Owner
Why.mobi, Campaign Director
Former dotMobi Policy Advisory Board (PAB) member
Former dotMobi Advisory Group (MAG) Steering Committee Member