Opposed to .xxx draft agreement - comments of Leap of Faith Financial Services Inc.

[George Kirikos <gkirikos@xxxxxxxxx>]

.XXX Draft Agreement Comments

From: George Kirikos
Company: Leap of Faith Financial Services Inc.
Website: http://www.leap.com/
Date: August 24, 2010

We 'd like to go on the record as being opposed to the .xxx draft agreement for 
the many reasons that have been previously stated by the community, including 
the following:

(1) it does not have the support of the adult industry. Appendix S part 3 is a 
joke of a definition of the community, basically saying that "anyone who 
supports us is a member of the community." In other words, their "community" is 
*not* the adult industry, but that small and UNIDENTIFIED segment of the adult 
industry who is supposedly "with them." Would .asia (which was also a 
ridiculous 
sponsored TLD) been allowed to go forward had 95% of Asian ccTLDs been opposed 
to it, had .asia used such a self-serving definition of their "community"? Of 
course not.

(2) it does not have the support of the broader internet community. All new 
TLDs 
should serve the broader public interest (all should be operated via regular 
tender processes for fixed terms and prices, and selected only by the public), 
not private entities who should only own domains at the 2nd level and below. 
It's clear from the public comments that have been submitted that this TLD does 
not have public support, either inside the adult industry or outside of it, 
except from a small group of "insiders" and allies who would financially 
benefit 
directly or indirectly from the application. 

A simple "costs vs. benefits" analysis *MUST* be performed for ALL ICANN 
decisions. This is stated directly in paragraph 4 of the "Affirmation of 
Commitments" document:

http://www.icann.org/en/announcements/announcement-30sep09-en.htm

"To ensure that its decisions are in the public interest, and not just the 
interests of a particular set of stakeholders, ICANN commits to perform and 
publish analyses of the positive and negative effects of its decisions on the 
public, including any financial impact on the public, and the positive or 
negative impact (if any) on the systemic security, stability and resiliency of 
the DNS."

When the DOC/NTIA or GAC, or those who oppose .xxx ask ICANN to produce the 
analyses of the "positive and negative effects" of .xxx on the public 
"including 
any financial impact on the public", ICANN cannot provide any response, because 
to our knowledge it has NEVER analyzed those. What are the positive effects of 
approving .xxx *on the public*, $10 million? $40 million? $100 million? What 
are 
the negative effects? $50 million? $5 million? $1 billion? Without the numbers 
or analysis, ICANN is ignoring its duties under Paragraph 4 of the Affirmation 
of Commitments. This leaves the door wide open for a Reconsideration Request or 
further appeals, until such time as ICANN provides the numbers to the public. 
This argument also applies to the entire new TLD process --- ICANN has failed 
to 
produce the relevant economic reports that it is *required* to produce. Also, 
non-financial costs and benefits need to be analyzed and published. Note, this 
is the effect on the *public*, not on ICANN's pocketbook. While ICANN has 
routinely acted to expand its own revenues in order to finance overpaid staff 
salaries and extravagant spending,

http://forum.icann.org/lists/op-budget-fy2011/msg00013.html

the relevant metric in the Affirmation of Commitments is the impact on the 
*public.*

(3) there appear to be no price caps in place to protect registrants and 
prospective registrants. This means that sex.xxx could be charged a higher 
renewal fee than sexy567.xxx, or playboy.xxx and hustler.xxx could cost more 
than an inferior domain. It also means that future renewals for domains could 
increase by an unlimited amount. Thus a site that becomes successful on 
example.xxx could see a renewal price increase from $100/yr to $100,000/yr or 
$1 
million/yr, or $1 billion/yr, without notice. In essence, registry operators 
aren't servants of the registrants, but instead can become "forced partners" 
via 
predatory pricing. This issue has been brought up numerous times previously in 
regards to the tiered pricing debate, e.g. when .info/biz/org tried to 
eliminate 
price caps. The community rose up and successfully opposed that proposal, and 
it 
is ridiculous that ICANN continues to present to the public draft contracts 
that 
once again attempt to eliminate price caps. It begs the question whether ICANN 
is simply incompetent or whether it is in cahoots with registry operators to be 
routinely removing important clauses that protect registrants. Given that other 
registry operators (like VeriSign in .com) might attempt to use these 
precedents 
via the "equitable treatment" clauses of their own agreements, it is clear that 
the final version of any registry agreement (including those for new TLDs) 
should contain strict price caps.

(4) ICANN protects its own trademarks (see Appendix 6, page 56) by placing them 
on a reserved list, for free. However, those who do not want to see their marks 
registered as domains in the .xxx TLD will end up flushing time and money down 
the toilet for a domain name they do not want to actually use. These "defensive 
registrations" waste the resources of the community, yet others do not receive 
the same protection ICANN gives to itself.

We might have submitted longer comments, but do not see any chance that the 
higher authorities (GAC and/or the NTIA/DOC) will allow .xxx to enter the root. 
In particular, reasons #2 and #3 are the most pressing (for this contract, or 
any other registry agreement), as they can have spillover effects (unintended 
consequences) on important TLDs like .com. While ICANN is a comedy of errors 
for 
allowing this saga to go on this long, it's heartening that we'll finally see 
closure when the higher powers put an end to this prospective TLD later this 
year. ICANN Board members who voted to keep the application alive (or abstained 
like cowards) should be ashamed of themselves for wasting the time of the 
public.

Sincerely,

George Kirikos
President
Leap of Faith Financial Services Inc.
http://www.leap.com/