Personal Comments on the Revised Proposed

[Tim Ruiz <theruizs@xxxxxxxxxxxx>]

ICANN Board of Directors,

Two of the largest ICANN Accredited Registrars report that .COM accounts
for 75% of ALL names registered by U.S. registrants. Registry reports
publicly posted on ICANN's website show that .COM accounted for over
80% of the 10.56 million increase in names in the un-sponsored gTLD
name space during the first 10 months of 2005, and at the end of
October 2005 .COM accounted for 75% of all un-sponsored gTLD names.

It is clear that we have yet to see any real competition to .COM and it
remains the de facto web address of choice. This sustained market power
makes it inappropriate at this point in time to permanently assign .COM
to any Registry Operator or allow unjustified price increases of any
amount. In fact, any request for a .COM price increase should be
responded to with a requirement to first re-bid the Registry Operator
agreement.

The proposed agreement also raises numerous policy issues as it
completely changes the relationship between the Registry Operator and
ICANN, the latter supposedly operating in the public's interest. I will
defer to the comments submitted by Bruce Tonkin on this subject, all of
which I am in agreement with.

I have read all of the comments submitted thus far on both versions of
the proposed agreement. I find it interesting that VeriSign and a few
others have tried to characterize these comments as only registrars
complaining. However, those making that characterization are simply not
paying attention. It is true that many registrars are not in favor of
either version of the proposed .COM agreement, for good reason in my
view. However, it appears to me that a large number, if not the
majority, of the negative comments have come from Internet users and
small businesses rightfully concerned about what this means for them. I
only hope that this fact is not lost on the Board.

There has been a suggestion that the reduction we saw in .NET registry
prices after it was put out for re-bid did not get reflected in
registrars' retail prices. In my view such a suggestion illustrates a
lack of understanding of how our industry really works, or perhaps how
any industry works.

It is true that we saw little if any decrease in the registration
pricing for single .NET domain names. However, most registrars are not
solely in the domain name registration business. They offer hosting,
email, DNS management, web site building tools, traffic builders, and
on and on. All costs, including the costs of domain name registrations,
are carefully considered in the decisions made as to what products and
services to develop, how those products and services are packaged and
bundled, and how those packages and bundles are priced. Reductions in
registration costs have been reflected in the prices of those packages
and bundles.

A couple of comments I read, including VeriSign?s, seem to express the
idea that in order to ensure innovation, long-term investments, and
even security and stability, the .COM agreement needs to be permanently
assigned. I disagree. Without any threat that .COM registry operations
could be put up for bid there is little incentive for the Registry
Operator to innovate or invest since there are currently no other
competitive constraints. It is competition that drives innovation,
productivity growth, and investment.

Finally, it is a question of focus. Focus on your public trust, focus on
the public interest, and make your decision based on the application of
documented policies neutrally and objectively, with integrity and
fairness, and with the goal of promoting and sustaining a competitive
environment as is contemplated in both your Bylaws and your MoU with
the Department of Commerce.

By way of disclosure, I am Vice President of Domain Services for The Go
Daddy Group, Inc. and currently serve as CTO/Vice Chair of the
Registrars' Constituency of the ICANN GNSO. However, these are my
personal comments and observations as an Internet user and registrant
of several domain names.

Tim Ruiz