Re: [soac-newgtldapsup-wg] 2nd draft of cover letter

[Eric Brunner-Williams <ebw@xxxxxxxxxxxxxxxxxxxx>]

Avri,

You've responded to the informal request for with two supporting 
rationals, first to market advantage and uncertainty of when or if 
subsequent planned policy-free mad stampeed will be permitted.
I suggest our first rational for offering support in the current round 
is that that is what the Board plainly sought in Resolution 20, and 
failing to do so would transform a Board Resolution from something 
mandatory to implement to something discretionary to implement.
In support of the market advantage observation I point out that all of 
the 2001 round applicants enjoyed a fantastic advantage over the 
applicants of 201x. Each was able to go to the market with the 
scarcity of the 2001 round (7-10), and the pre-dot-bomb valuation of 
anything approaching the com/net/org business. NeuStar was able to 
raise millions in investment, Afilias too was a joint stock investment 
beneficiary, and even CORE was able to charge a membership fee at a 
level unimaginable today. The 2001 applicants were able to start with 
millions in working capital or valuations of their assets.
Today's applicants have the disadvantage of the market having a decade 
of experience with ICANN, of delays and serious problems and domainer, 
registrar, and registry exploits, and the sunny optimism of the 
1999-2001 market is dead.
Today's applicants have the disadvantage of the market anticipation of 
scarcity, even poverty, of new registry start-ups, due to the vast 
number of commercial exploits ICANN has made clear it will permit, to 
which the Great Recession of 2007-201x contributes, unlike the crash 
of March, 2001, which took place after the applicants were capitalized.
Finally on this point, unlike the 2001 and 2004 applicants who all 
sought to create revenue streams sufficient to meet their operating 
costs and service their debt, with no fratricide or sororicide 
interaction with other registry contract holders engaged in the same 
pursuit in a mostly disjoint market, the proposed ICANN contract only 
requires nominal execution of registry build-outs, and rational 
investors will sink the application fee and the minimal operating to 
meet the nominal contract obligations and exercise a highly 
fratricidal or soroicidal effect on subsequent attempts to enter the 
same or overlapped markets.
Unlike the past, a 201x ICANN registry contract is a low cost to 
acquire monopoly in a market, probably more so in IDN dependent 
markets, and certainly so in markets where linguistic, cultural or 
ethnic minorities are currently under-served or unserved by current 
registry operators.
In support of the uncertainty observation I point out that we don't 
know that the current form of the new gTLD process is any better than 
the 2001 or the 2004 new gTLD process, and it is imprudent to assume 
that the same process will be repeated without modification or delay 
on some fixed schedule. Manned moon landings took place twice in 1969, 
twice in 1971 and twice in 1972. There have been none since.
I hope this is helpful, that there is a line or two here that you can 
use to support our work.
Eric