Comments of Tucows Inc.
Statement of Tucows Inc. Re: Verisign/ICANN Settlement Proposal February 20, 2005
“Examine each question in terms of what is ethically and aesthetically right, as well as what is economically expedient. A thing is right when it tends to preserve the integrity, stability, and beauty of the biotic community. It is wrong when it tends otherwise.” - Aldo Leopold, 1886 - 1946 Statement In addition to our prior comments on this subject, Tucows Inc. reiterates its rejection of the Verisign/ICANN Settlement Proposal on the basis that, with the exception of the changes to the sources of funds payable to ICANN, there are no material changes to this version of the proposal. To restate our earlier concerns; 1. The outcome does not provide sufficient benefits to the internet community that both ICANN and Verisign, in its role as administrator of .com, were intended to serve. While the ICANN staff likely intends to do “good works” with the new funds that this proposal will make available, the overall cost of the settlement far outweigh any anticipated benefits. Balance must be achieved in the pursuit of ICANN's strategic objectives. Amongst this proposal's costs is a fully competitive domain name market place. Six years of progress bringing competition to the DNS has been sacrificed to achieve goals equally important goals related to security and stability. We submit that granting a perpetual monopoly to a single provider on this scale, centralizes critical infrastructure to the point that irreversibly diminishes the overall stability of the DNS. Thus, ICANN's failure to ensure the demise of a competitively managed DNS will lead to its failure to meets its objectives as outlined in its Memorandum of Understanding with the United States Department of Commerce. 2. This agreement permanently delegates .com to Verisign. ICANN has been assigned oversight responsibility of the namespace as a public trust. Until such time as effective competition has been introduced into gTLD namespace all gTLD registry administration contracts, including those stemming from any settlement with Verisign must be constructed as management contracts with a finite term and meaningful termination clauses. The proposal lacks all of these safeguards and ignores existing policy concerning management rights. This is not a theoretical premise. Cancellation and reassignment of a contract significantly incents contractors to perform their obligations to the maximum extent feasible. The capability to cancel the agreement, or even reassign it, is a powerful tool that ICANN is about to bargain away. 3. In addition to this permanent delegation, the ICANN staff proposes to provide Verisign with the capability to increase their prices, without qualification, up to 7% annually. These additional rights are granted in an environment that would otherwise see decreasing prices if competitively managed. Furthermore, the most recent version of this proposal does not materially change these terms. The overall reduction in the maximum amount of fees that Verisign can collect under this proposal has been estimated to be 4%. ICANN's representation that this is a meaningful concession is fundamentally misleading. Any arrangement with Verisign needs to preserve the principles of RFC 1591 by explicitly recognizing the limits of the Registry Operator as an administrator acting in the interests of the internet community. Further, the arrangements must include provisions for cancelable administrative contracts of a finite term with the registry operator. The arrangements must also preserve the checks and balance of the existing decentralized funding model, including provisions for the continuance of the Registrar budget portion approval process. This enumerates only the most important points. The proposal contains an excessive number of problematic concessions including giving Verisign commercial rights in all registry meta-data and releasing Verisign from $200mm in R&D spending. The proposed agreement fails to make meaningful progress towards reconciling any of these concerns and despite our support of the changes to the budget funding and collection mechanism, we cannot support or endorse this agreement. ICANN's General Counsel has indicated that ICANN would prevail in this litigation. We therefore urge ICANN's Board of Directors to reject the staff proposal and prepare itself to vigorously pursue litigation of the matters at hand. About Tucows Tucows Inc. provides internet services and downloadable software through a global distribution network of more than 6,000 service providers. These service providers primarily consist of web hosting companies, internet service providers and providers of other services over the internet. Tucows' services include domain registration services, digital certificates, billing, provisioning and customer care software solutions, email and anti-spam services, Blogware and website building tools. Tucows is an accredited registrar with the Internet Corporation for Assigned names and Numbers, or ICANN. For more information, please visit: www.tucowsinc.com |