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Username: webster
Date/Time: Thu, October 26, 2000 at 5:42 PM GMT
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Subject: msnbc-meeks-icann

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This link was posted today at www.Lists.netsol.com 

http://www.brandenburg.com/misc/msnbc-meeks-icann.html


Commenting on Meeks' ICANN Reporting

D. Crocker
Brandenburg Consulting

  A 25 October 2000 article by MSNBC's Brock Meeks http://www.msnbc.com/news/480700.asp contains numerous factual errors and guilt-by-association slanders. Below is a copy of Meeks' article's, with my own comments interspersed. /dc 

Dirt in the domain name game: Insiders hoard the goods

IT ALL STARTS with the controversial organization known as ICANN or the Internet Corporation for Assigned Names and Numbers. The non-profit group was hand picked by the Department of Commerce to transition the assignment of Internet domain names from a monopoly to a competitive environment.

  ICANN was developed under Jon Postel, who created an operated the Internet Assigned Numbers Authority for nearly 15 years. The U.S. government selected ICANN because it seeks privatization of these administrative functions. No other organization put forward an organized and detailed plan with broad community support, much less attempted a public development process for this role. Who else was a credible candidate for this task? For all of the claims about massive criticism of ICANN, there is an unfortunate tendency to ignore its massive support. 

       What ICANN has mostly done is create controversy with every decision, while turning itself into a de facto model for global Internet governance, a task it was never supposed to undertake.

  ICANN has been quite studious in its efforts to focus only and exactly on its administrative tasks. The efforts to turn it into a supposed model for Internet "governance" has come from others, outside ICANN. When challenged about claims of ICANN doing more, critics note potential, rather than actual transgressions by ICANN. 
  What is particularly facinating about the claim of ICANN secrecy is that it is more open than any equivalent organization. Most criticisms of ICANN process seek to have every facet of every activity in ICANN subjected to full community review and participation in decision processes. Such a perspective lacks attention to pragmatic requirements for making progress. What other operational organization is subject to fishbowl participation at such a level? 
  Although a relatively small core of disaffected, loud voices persist, what has been most notable at ICANN meetings is the acceptance and support for the organization's activities. Hence, the loud rantings mostly serve only to prevent reasoned public debate. 

       The acrimony between ICANN and its legions of critics is as thick as the peanut butter on a two-year-old’s sandwich. Truth is, ICANN has manufactured most of its own troubles, starting with a stupefying bent toward secrecy, while pledging to operate in a spirit of consensus and transparency.


       ICANN’s proceedings and board meetings have only recently been held out for public accountability and scrutiny. And that was a begrudging concession to a ground swell of public criticism.

  "Recently" means most of ICANN's existance. "Begrudging" is a wonderful catch-22 turn of phrase. If the organization makes no change, then it is unresponsive. If it is responsive to community input, then somehow it is still characterized as not wanting to make changes. 


       Then just last week we learn that a crucial ICANN policy committee was created and is meeting secret. That committee is meant to provide recommendations on the implementation of certain aspects of the popular “whois” database, which lists the owners of Web sites.

  Those of us in the technical community, who are active with DNS and ICANN would be interested in hearing detail about whatever conspiracy is being claimed, here. The secret is so well kept, literally no one appears to know about it, including those presumably involved... 


       One law professor has even stronger words for the ICANN debacle: “In lending ICANN its control” over the domain name space, the Department of Commerce “created a system in which social policy is made not by due process of law but by something that begins to resemble government-sponsored extortion,” writes Michael Froomkin, a law professor at the University of Miami School of Law in a law review article for the Duke Law Journal.


  Prof. Froomkin has neglected to notice that a) the goal is not to "lend" control but to relinquish it, and b) the Internet is not a US entity, so that its administrive process must not be purely subject to US processes. 


      
DIRT IN THE DOMAINS
       There are three generic top-level domain names right now: .com, .org and .net. By far the most coveted is .com. However, the dot-com space has nearly reached its saturation point. Trademark conflicts abound. And just try to find an available two or three letter dot-com — you’d have better luck finding sweat on a dog’s back.
       That scarcity forced ICANN to choke on its hairball policy that new domains couldn’t be introduced for fear of crashing the entire Net, and it began the process of taking applications to create new domains.

  ICANN has never had a policy that new domains could not be introduced. It has had a policy of proceeding with due diligence and due caution, as apprpriate for an organization that is a) new, b) responsible for operation of critical infrastructure resources, and c) having to pay rather a lot of attention to the carping of poorly informed critics. 


       The ground rules noted that anyone could submit an application to run a new domain, a potentially lucrative business that can return hundreds of millions of dollars in annual revenue.
       But the brutal truth is, ICANN didn’t want just anyone to submit a proposal, so they imposed what amounted to a digital poll tax: all applicants had to pony up a non-refundable $50,000 check. Some 47 applications were received, pouring $2.35 million into ICANN’s cash strapped coffers.
       And none of the applicants is guaranteed it will get to run a new domain; ICANN hasn’t even decided how many new domains to create. Estimates range from three to 12, but hundreds of new domains were proposed in the bidding.

  47 is hardly a small number, thereby suggesting that the barrier to entry is not nearly as onerous as is being suggested. How many untested (and problematic) new business sectors get that many entrants right out of the gate? 
  By the way: Not wanting "just anyone" to submit a proposal is a Good Thing, not a bad one; this is critical infrastructure and financial resources are one of the necessary indicators that an applicant just might be able to perform the necessary functions. 

        But one group of players has seen to it that they have an inside track in being selected to run one of the new domains.
       Members of a newly created company called the Afilias Group have, in one way or another, managed to get their hooks into more than one-third of the domain proposals. Members of Afilias include the current monopoly domain name registry owner, Network Solutions, Inc.

  Let's see if we get the innuendo right: it is bad that interested parties got together to cooperate on an application? It is bad that they participated in more than one application? It is bad that the company that has a monopolistic position in the pre-expansion world is being permitted to participate as an equal-among-many? 
  It would be interesting to see the legal basis for excluding NSI from a cooperative and equally interesting to fantasize about the ensuing lawsuits. (And I am no fan of NSI.) 
  Did anyone bother to ask about NSI's participatiion in this group? Has it, for example, been out-voted with any regularity? (The answer is that it has, of course.) 

       The “registry” is key and differs from a “registrar.” There are dozens of the latter; these companies will register your chosen Web site name for a fee. But it’s the Network Solutions registry that is the cash cow.
       Every registrar has to pay a registry fee to Network Solutions for every new dot-com-this or dot-com-that it creates. The registry is the central clearinghouse that keeps track of all those domain names and its profits go only to Network Solutions, which is now owned by Verisign.
       Afilias also counts CORE among its members. CORE grew out of a group that tried unsuccessfully, a couple of years ago, to pull off what can only be called the first coup d’etat in cyberspace. CORE set up its own company and registrars and said it alone would create new domains and be governed in U.N. fashion, under Swiss bylaws. The attempt failed and CORE was reduced to treading water waiting for ICANN to bless the creation of new domain names.

  The "coup d'etat" that is being cited was an effort sponsored and approved by IANA -- the folks that created and ran DNS administration. Hence, the effort was by IANA, itself. So, how does one accomplish a coup d'etat when one is the "etat"? 
  CORE did not set up CORE. It was set up by an independent body operating under IANA. (Full disclosure:I was a member of that independent body and editor of its report.) Neither that body nor CORE ever said that it alone would create new domains. That authority rested with IANA and such was always -- repeat, always -- stated explicitly. 


       That Network Solutions is even being allowed to participate, in any way, in the creation of new domains is a travesty. The U.S. government created Network Solutions’ monopoly in the first place and then spawned ICANN as a means to help introduce competition into the domain name market. ICANN apparently forgot to look up “competition” in the dictionary.

  NSI's market position is, indeed, remarkable and inappopriate. Does the best way to fix this require making special, exclusionairy rules against NSI, or rather simply to require that it compete on an equal footing? Mr. Meeks apparently forgot to look up "complexity" in the dictionary. 


       If one of a few new domains goes to “a group of registrars who collectively already have 98 percent of the .com, .net and .org market, one would have to ask, ‘why?’” says Milton Mueller, Associate Professor, Syracuse University School of Information Studies. “It seems to be not only bad competition policy, but raises fundamental concerns about how ICANN operates, because the organization would appear to be incapable of awarding resources to anyone but its own insiders.”

  Prof. Mueller has failed to distinguish registrar market from registry market. He has also failed to note corporate and legal boundaries. The cited applicants have zero percentage of the registry business. Some of the members of some of the applicant consortia -- other than NSI -- have a percentage of the registrar market. 
  The reference to "insiders" is equally remarkable, since a) it presumes an outcome that has not yet happened, b) it presumes that the application process was not open to all who satisfy the listed requirements, and c) it states that those inside ICANN are being given allocations. This last point is a charge of extreme conflict of interest and it would usually be accompanied by at least a modicum of documentation to back up the claim. Such documentation is eagerly sought, Mr. Meeks. 


      
SHOOTOUT AT THE .WEB CORRAL
       I suppose the real test of whether ICANN has the political will to “do the right thing” will come with its decision over who gets to run the .web domain, which surveys show is the most desired new domain.
       Small catch: .web already belongs to Image Online Design.

  Small catch:  No it does not. Not in the ICANN/IANA domain system. 


       Image Online Design has been running an alternative domain name registry using .web since 1996; that registry has attracted about 20,000 paying .web domain name holders.

  IOD's activity has been entirely independent of IANA and ICANN, other than the two, failed lawsuits it has initiated, and it is free to continue its independent activities. ICANN is taking no action that prevents IOD's independent activities. 


       ICANN has refused to recognize Image Online Design’s efforts when in fact it could specifically set aside .web under a “pioneer’s preference” exemption, much like the Federal Communications Commission has done when handing out slices of the airwaves to companies that have pioneered particular technologies.

  IOD did not come up with the "idea" of .web first. Further this raises an interesting question: what exactly are they supposed to have "pioneered"? That people are interested in the web? That people want additional top-level domains? 
  Giving anyone special position is called favoritism. The purpose of the ICANN exercise is to increase competition. Competition is about the absence of favoritism from an oversight body, not about having the body engage in favoritism. 


       Now Image Online Design finds itself fighting for what is clearly its own intellectual property. One of those bidding against it is — big shocker — the Afilias group.

  "Clearly" its own intellectual propoerty? Given that it has lost two lawsuits on this topic, there probably is a clear basis for assessing its legal position, but the clarity is of the absence, not presence, of IOD intellectual property. 


       Image Online Design CEO John Frangie said the Afilias bid for .web is led by the “world’s greatest monopolistic force: NSI.” Frangie then goes on to say that Network Solutions has “put together a cartel of 19 companies to capture even more market share,” noting that the Afilias proposal is a “cynical attempt to enhance the entrenched monopoly of NSI” and thereby “perverting the very process that ICANN established to increase competition.”
       I couldn’t have said it better.

  You couldn't? That is unfortunate, since we are afforded no factual basis for the claim and IOD is just a tad biased. A reporter is supposed to be neutral, absent documented facts. For that matter, a reporter is supposed to make some effort to acquire facts. 


      
MONEY TALKS
       And just finish off this murky tale, the other bidder for .web is listed as NeuStar, which as it turns out is really “JVTeam,” a “new company formed by NeuStar and Melbourne IT,” its application says. The latter of those two is a member of CORE and thus also a member of Afilias. Smell a trend here?

  A trend? Oh my goodness, yes. It is called hedging one's bets in a lottery. Any intelligent participant in a process such as this will try to find ways to win, and participating in multiple bids is the standard technique. 
  Full Disclosure: I have recently become an advisor to Neustar. I have no previous financial involvement in this topic. Highlighting that the process is open: Neustar has extensive registry experience for telephone number administration, but is new to DNS administration. 


       Wallow through this JVTeam bid for .web long enough and you come across this statement:
       “JVTeam is prepared to meet with ICANN and discuss any legal issue relating to a .web registry. If necessary, JVTeam will indemnify ICANN for legal expenses incurred by ICANN resulting from any legal challenges brought regarding a grant of the .web registry to JVTeam.”
       I’m sure they didn’t mean to try and bribe ICANN, but it sure sounds like the old comedy sketch where a conniving driver, pulled over for speeding, hands the cop his license wrapped in a $50 bill.

  A bribe? Bribes are supposed to create some inapprpriate benefit for the bribed party. To guarantee to cover the legal costs -- if there are any -- is a bribe? Companies do not casually offer to indemnify another party, when there is a significant potential for a credible -- or even incredible -- lawsuit. However such language in a contract is extremely common. A far more reasonable interpretation of the offer is that a company that is trying to make a profit has determined that the IOD position is sufficiently lacking in real legal merit so as to make the risk associated with indemnification minimal. 


       ICANN will deliver its decision on new domain names in November. The group can redeem itself, if ever so slightly, by outright dismissing all proposals from established players in the domain name space. But don’t hold your breath.

  Now here we have a truly novel idea: For an activity involving administration of critical infrastructure, let us formally exclude anyone who has any experience with it. How clever! 


       Although ICANN says it is looking out for the stability of the Internet as it tries to micromanage the domain name space, that argument flies with the all the grace of a penguin. ICANN is cowed by big money interests. And money and power talk, in cyberspace, just as they do in the halls of Congress.

  As ICANN tries to make progress in the face of outlandish and unfounded claims from ill-informed participants and reporters, who are trying to micromanage its activities, it is astonishing that the Internet survives. 


No I am not K Stubbs or D Crocker,  I did not write the above Comments
I am simply posting it for Public Transparency of the issues.

Please Don't reply to my post, it simply clogs up this Forum.

As of 16:00 CDT wednesday the total postings to the commentary list was 2360 Of that number OVER 775 POSTINGS WERE MADE BY JUST 16 PEOPLE
http://www.icann.com/cgi-bin/mbx/rpgmessage.cgi?tldapps;39F82E7800000AED

 
Regards

Webster

     
 

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