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Username: Spectral Web, Inc.
Date/Time: Sun, November 12, 2000 at 8:08 PM GMT
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Subject: “Spectral Web, Inc.’s Comments on the Examiner's Report on Image Online Design, Inc.”

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Spectral Web, Inc.

“Spectral Web, Inc.’s Comments on the Examiner's Report on Image Online Design, Inc.”

Forum: “ICANN Public Comment Forum ~ Forum on New TLD Applications II”
Submitted: 11 November 2000
__________________________________________________________________________

On 5 November 2000, Spectral Web, Inc. submitted its statement on the matter of new gTLDs to ICANN's New gTLD public comment board.

(http://www.icann.org/cgi-bin/mbx/rpgmessage.cgi?tldapps;3A057DFA00001157).

Twenty-four hardcopies of this statement were also postal mailed to ICANN’s headquarters at the following address:

     4676 Admiralty Way
     Marina del Rey
     CA 90292

The twenty-four packages, each containing a copy of the same fourteen page document, were respectively delivered to Michael Roberts, Esther Dyson, Amadeu Abril i Abril, Robert Blokzijl, Geraldine Capdeboscq, Vinton G. Cerf, Jonathan Cohen, George Conrades, Greg Crew, Philip Davidson, Frank Fitzsimmons, Ken Fockler, Hans Kraaijenbrink, Sang-Hyon Kyong, Jun Murai, Alejandro Pisanty, Helmut Schink, Eugenio Triana, Linda S. Wilson, Karl Auerbach, Ivan Moura Campos, Masanobu Katoh, Andy Mueller-Maguhn and Nii Quaynor

In that statement, Spectral Web,

    *  supports .web for Image Online Design, Inc.
    *  supports .shop for Name.Space.com
    *  supports .museum for Museum Domain Management Association (provisionally)
    *  supports .kids as “a very desirable, very necessary gTLD,” though Spectral Web did not feel entirely pleased with any of the current .kids applicants.


Currently, Spectral Web would like to comment on the examiner's report on Image Online Design. In addition to posting this statement, Spectral Web will both email and postal mail the statement to the above-mentioned ICANN directors, to media sources and to the appropriate political leaders.

Furthermore, Spectral Web will issue additional statements regarding the reports on Name.Space.com, Museum Domain Management Association, Blueberry Hill, Inc., DotKids, Inc., KIDS Domain, Inc. and ICM Registry Inc.

Spectral Web, Inc. is familiar with Image Online Design, its history, the TLD it pioneered and the role it has been playing in the process. While Spectral Web appreciates that all aspects of all applications need to be scrutinized, Spectral Web is distressed by the seeming lack of objectivity evidenced by the examiners in this report. In fact, looking not merely to the report on Image Online Design but to all reports, it is clear that analysis is often erroneous, inconsistent, biased, illogical, superficial and unreasonable. 

Spectral Web respectfully advises ICANN to be fair, reasonable and prudent in the days and weeks to come. With so much careless, clumsy and flippant work having been generated by the examiners; so much that is unsubstantiated; so much that is glossed over; so much in error; so much clear irregularity and potential for impropriety, ICANN's entire application process, including the $50,000 fee, comes into question. Given the sketchiness, hastiness, impartiality of the respective reports, Spectral Web notes that the $50,000 fee seems altogether unwarranted.

Spectral Web feels that given the multitude of "errors," the examiners might have intentionally misrepresented the overall strength and viability of Image Online Design. This is a curious point, because in order to discount Image Online Design, the examiner had to fabricate data, leave opinions unsubstantiated, speculate baselessly and ignore strengths. If Image Online Design were truly unprepared for the task of running .web in a more official capacity than it already does, the examiners would have no need to fictionalize. If the examiners did indeed intentionally fictionalize, their perceived need here illustrates their recognition of Image Online Design's viability.

All examples of bias, inconsistency and erroneous reporting are now a matter of public record, and further advance the case for Image Online Design.
__________________________________________________________________________

I.  Technical Matters

1.  

The matter of the six-month timeframe for accepting registrars other than Image Online Design has been discussed at length. Initially, Image Online Design thought that six months would be required to finish developing and testing the registrar protocol system. However, in their flexibility, they have reassessed and have determined that a 30 to 60 day time frame is feasible.

Firstly, Spectral Web thinks that the original six-month projection was reasonable. Network Solutions enjoyed being the singular registry for far more than six months, and their own transition time was hardly rushed.

Secondly, given that the timeframe from TLD approval to online availability itself will be 60 or more days, Spectral Web would like to point out that this protocol might be available and in place on the very first day of .web's rollout.

Thirdly, please note another example of the examiner's bias in that it praised Neustar who itself indicated an expected six to nine month timeframe.

Fourthly, Afilias originally wanted to exclude all registrars not currently members, and only later stated it would accept new registrars; yet it has not indicated any kind of timeframe. This might translate into years. Yet again though, this applicant was deeply praised.  Please note that the tone and tenor of Afilias' interest in the Internet community and in market fairness is precisely that as evidenced by Network Solutions to date.

So why does the examiner's report regard Image Online Design's application as being flawed for the original six-month projection?

Spectral Web is also deeply disheartened by ICANN itself. When Image Online Design indicated to ICANN that it would now commit to a 30 to 60 day timeframe, ICANN chastised Image Online Design for making an amendment to the application. Clearly this is another example of the "Damned If You Do, Damned If You Don't" Principle. Spectral Web requests that ICANN be reasonable and fair, and recognize that such flexibility in an applicant should be commended, not condemned. Furthermore, was Afilias commended or condemned when it changed its mind about excluding all outside registrars?

2.

ICANN does not seem to recognize that Image Online Design, unlike its competitors, has a database already prepared to be entered into the Internet root. All other proposals talk about theoretical databases; yet databases cannot exist merely on paper.

Particularly frustrating is that the examiner's report states that Image Online Design is not prepared to scale; yet Image Online Design has already proven it can. Without proper substantiation, the examiners comments are meaningless opinions. Spectral Web is saddened that ICANN has employed such questionable service.  The examiner's "work," quite simply, has diminished this process.


3.

The report states that 20,000 registrants is too low a registration base to determine database viability. However, this statement,

      * negates the years that the databases have been running.
      * condemns every applicant from the word "go," as the examiners feel
        that a prerequisite for being approved registry status is having been
        a registry. Given the Names Council declaration on "preregistrations,"
        Spectral Web respectfully suggests that all reasoning here is in
        accordance to the "Damned If You Do, Damned If You Don't" Principle. 

        Clearly, we come to circular reasoning, which brings us back to the
        matters of industry monopolization, unfair policies and practices against
        all applicants (other than NSI and current registrars), ICANN's open
        application process and the $50,000 fee.


Quite simply, if Image Online Design's 20,000 registration base does not prove viability, then ICANN must never approve an applicant with anything less than ten times that amount. Or is 200,000 also too short a track record? Where shall the arbitrary line be drawn?

Curiously, the examiners did not condemn other applications for having *no* evidence of database viability in the absence of a registration base. This also indicates bias. Again, it is a matter of public record and is discernible to laymen and the most casual of readers.


4.

Why does the report inaccurately state that Image Online Design's registry will provide 28.6 TPS, when the figure is clearly a lot higher? Why has an amendment not been made? To judge an application on erroneous information is not only unethical; Spectral Web questions the legality.

Furthermore, Image Online Design's registry can scale both horizontally and vertically, a feature ignored by the examiners in Image Online Design's case, but one which the examiners praised in Afilias' case.


5.

Upon reading Christopher Ambler's public call to more closely compare Afilias' and Image Online Design's respective technical sections to the applications, Spectral Web must agree that the performance numbers fall within 5 % of one another, indicating yet again, the inherent bias of the examiners. As Mr. Ambler muses, "We're called inadequate, and they're praised?"  (http://www.icann.org/cgi-bin/mbx/rpgmessage.cgi?tldreport;3A0DD02A0000016E)

ICANN must be made to see this point. It is a point that will not simply go away when the examiner walks away.

Further distressing is Mr. Ambler's testimony in the above linked statement in which ICANN was invited to tour Image Online Design's facilities and "demonstrate the scaling abilities first-hand," only to later cancel the consultation period.

6.

The report states, "It is not clear if IOD can manage the higher level of capacity. Its simulations suggest it can, but IOD has no experience operating any kind of system at this scale."

Spectral Web finds this statement to be specious, as the only entity that has formal experience in this matter is Network Solutions. In essence, the logic being used is, no entity should be granted rights to a popular TLD other than Network Solutions. This brings us back to Square One regarding monopolies, competition and the credibility of the application process.

II.  Financial Matters

1. 

The examiner's report is in error with regard to Image Online Design's current financial strength. While $450,000 is available today in the form of cash, Image Online has commitments of $2 million imminently, and an additional $6 million upon approval.  Additionally, Image Online Design has a credit letter which promises to discuss the possibility of further funds.

Image Online Design has already spent  $1 million developing, improving and smoothening out its databases. This is a necessity that other applicants have yet to secure; then the equipment these other applicants must buy, would have to be installed and tested.

Clearly, the  $450,000 that the examiner quotes is in error. What remains to be answered is "How credible is the examiner, given the frequency of these 'errors?' "  For that matter, given this frequency and given the extreme slant that is given, how likely is it that the examiners are intentionally misleading ICANN?


2.

The examiner states that Image Online Design's financial projections are questionable; yet no explanation or counter-projection is provided, making the examiner's statement relatively meaningless.

III.  Market Matters

1.

In the past, ICANN has recognized that competition was a main concern when it comes to the matter of new TLDs. (http://www.icann.org/yokohama/new-tld-topic.htm#IIC1). This necessity was furthermore very significantly detailed in the White Paper (http://www.ntia.doc.gov/ntiahome/domainname/6_5_98dns.htm).

Therefore, if ICANN is to approve Afilias for any gTLD at all, given the participants within that conglomeration, ICANN will have systematically and intentionally obliterated competition in the domain industry and handed over to Network Solutions yet another desirable gTLD. Given that Network Solutions currently enjoys the vast majority of market profits, broadening its grasp would be unconscionable and might put ICANN into a position of explaining its role in a possible antitrust dilemma. True competition is derived from permitting new blood into the arena, not by shuffling around current players (NSI and registrars). It is meritous that that while Image Online offers significant balance in the market, they are not entirely new to the game.


2.

Given Image Online Design's history with .web, it hardly seems defensible that Afilias or any other entity should be granted the .web TLD itself, when Afilias and other parties ask for other gTLDs within their application. This statement acknowledges that ICANN might, against fair judgment, recognize Afilias in this process.

In short, if ICANN feels that granting Afilias a new gTLD would not be unethical or in violation of any antitrust laws (though Spectral Web strenuously disagrees), to choose .web to be that gTLD is highly suspect, given that there are other options within said application. ICANN's interests and the participation of some of its members in Afilias' application will naturally fall under observation and criticism.

Quite simply, if Afilias is to be granted anything, it should be .site or .info; and .web should be rightfully granted to Image Online Design.


3.

ICANN has asked for a proof of concept for all new TLDs. Image Online Design, through their labors, have proven the proof of concept with regard to .web. The other applicants have done nothing in this regard, but rather seek to benefit from Image Online Design's labors.


4.

The examiners' report condemns the $15 domain fee; however, there seems little justification for this. Furthermore, Spectral Web thinks it is specious of any entity to ignore that which Image Online Design clearly identifies: the market will determine the cost. Though the examiners are free to issue their opinion on the matter as baseless as that opinion might be, it is not within ICANN's charter to regulate price. ICANN should only provide competition--true competition--and allow the market to determine ultimate pricing. Furthermore, Spectral Web does not find either $15 or $35 to be exorbitant.

The examiner states, "(The $15 price) is at least two and a half times the registry prices anticipated by others in this category. This higher price is likely to deter registrars and potential registrants."   However, Spectral Web believes this statement to be totally fallacious. Firstly, with the initial registration fee of $70, Network Solutions did remarkably well in its early days. Furthermore, the virgin territory of the .web namespace will be more than enough enticement to both registrars and registrants; quite simply, with so many nice domain names open for registration, the expense of $15 or $35 is minuscule. The market is ripe for an incalculable number of interested parties. With all due respect, Spectral Web does not think that the examiners have a grasp of the magnitude of this industry.

IV. Business Matters

1.

Though Image Online Design has been a part of the process for such a long time and has pioneered the .web registry under direct instruction to do so, it has never sat on its laurels but rather has constantly moved its operations forward; yet ICANN continues to ignore the history of Image Online Design. Given that ICANN will no doubt, today and in a future rollout, award TLDs to less tested, less tried, less proven and less prepared applicants, it is incumbent upon ICANN to finally acknowledge Image Online Design's record; the alternative has too many repercussions not merely to Image Online Design, its close to 20,000 registrants, the Internet community and industry fairness, but upon ICANN itself, who every time they award a TLD to an entity less prepared than Image Online Design, initiates a revisit to an anti-IOD ruling.

Conversely, by bringing in new blood, ICANN illustrates to the world that this industry and ICANN's operations are not fettered by corruption, bias or nepotism.   


2.

Image Online Design has been in operation since 1996, not merely surviving, but flourishing. Given the sharks that occupy these waters, Spectral Web maintains that Image Online Design's history of endurance is a testament to its viability.


3.

The examining team criticizes Image Online Design's CEO and COO for not having technical skills. Yet this is not a prerequisite. Nor is it relevant. Their roles are to function as business managers, not as technicians. The logic ICANN uses here is akin to logic that mandates that the manager of a bakery know how to build and fix ovens. This person does not need to know these matters. He or she needs to know how to run and manage a business, which clearly the CEO and COO have proven. As for the technical knowledge: that is why specialists are hired and contracted.

To illustrate this point, pardon the following irreverence--but how equipped to run the day-to-day technical operations of the root are the ICANN directors? Can they handle failures? Instability? Can they troubleshoot?  Respectfully, Spectral Web does not believe that many of the said persons are specialists in these areas; no doubt, some like Vinton G. Cerf are, but this is the exception rather than the rule. So for the most part, non-specialists within ICANN preside over the Internet itself.

Furthermore, Spectral Web does not find in the examiners' report on Afilias or Neustar or anywhere else that the respective CEOs and COOs are required to have technological expertise. Even more condemning is the matter of Afilias' technical personnel: they have none. It is insufficient to say that there are certainly members within the conglomeration that will assume the necessary roles. Spectral Web wants to know who these individuals are. Before this functions can be reviewed, it must be fulfilled. Anything less and there exists a vacuum in Afilias' application.

Additionally, it is unrealistic to expect that any applicant should be operating with 1,000 or more employees in the field prior to approval. The report offers paradoxical reasoning. Clearly, the only entities within the domain registry field with that kind of existing employee base is Network Solutions and the handful of registrars. This lends itself to circular reasoning, reasoning that in the end excludes all but current industry participants. This not only negates competition; it negates ICANN's open application process in which ICANN has, to date, garnered $50,000 per applicant. In short, why did ICANN accept these fees if ICANN does not care to regard non-players?

While the examiners criticize Image Online Design for identifying a 70-person staffing need, the examiners do not bother to identify this same matter in the competing applications.


4.

The team stated that "A failure to service a global customer base on a 24 x 7 basis, particularly during the initial startup period, could fatally damage the reputation of the new TLD."

Firstly, Spectral Web does not believe that such a system's failure is likely, given the history of the databases and the reports Image Online Design has generated.

Secondly, the above quote is entirely speculative and, not atypical of this examiner, unsubstantiated. Follow-up logic is not even employed.

Thirdly, ICANN's charter does not include monitoring the reputation of various TLDs. This has not been evidenced as it relates to .tv, .cc, .fm, .md, .ws, .bz, etc.

   .tv is for Tuvala, not for matters involving the television industry.
   .md is for Moldova, not for matter related to the medical profession.
   .bz is for Belize, not for generic business interests, as in "biz."
   .fm is for Micronesia, not for matters related to radio broadcasting.
   .ws is for Western Samoa, not for "World Site," "Web Site" or any such thing.
   .cc is for Cocos Islands, not for "Commercial Company" interests


Fourthly, the reputation of a TLD is not determined by a registry's 24 X 7 status; it is determined by how the TLD is developed by individuals and businesses, and how said individuals and businesses market their websites and develop their operations. This, more than any other element, is what will impact the general Internet user. Given the self-evidence of this point, the examiner's above quote seems so obviously incorrect and Spectral Web questions the credentials of the examiner.

Still, Spectral Web maintains that Image Online Design will be able to operate at, or extraordinarily close to, a 24 X 7 basis.  Nonetheless, a few minutes or hours short of a 24 X 7 operating schedule for any TLD will itself have no impact whatsoever on the reputation of said TLD.

V. Legal Matters

Spectral Web also feels that the offer Image Online Design's competitors have made to ICANN in the matter of "indemnification" is severely dubious, might stand on legally shaky grounds, and is a public relations nightmare--for this offer may not be perceived as an indemnification clause so much as a bribe. This is something to which ICANN must not be party.

VI.  Additional Matters

1. 

Spectral Web wants to emphasize the illegitimacy of Neustar's application for .web, especially since Melbourne IT left the partnership. This glaring vacuum only makes the examiner's report on this application that much more incredulous. Neustar was praised as being a viable candidate for .web despite the fact that their crucial alliance has shattered.

The examiner only mentions the departure as a footnote, and does not explain the enormous impact that this departure has on the application. Spectral Web asks ICANN to examine the possible motivation, and consider the possibility of bias.


2.

ICANN continually ignores the IANA component. The truth of the matter is, IANA authorized that Image Online Design commence operations.  To be certain, this may very well not be enough to warrant approving Image Online Design; but nor is it to be ignored. In the event that ICANN rejects Image Online Design's application, Spectral Web believes that the matter of this authorization will appropriately resurface.


__________________________________________________________________________

Spectral Web once again thanks ICANN for the opportunity to voice thoughts and concerns in these proceedings.

Spectral Web will issue additional statements regarding the reports on Name.Space.com, Museum Domain Management Association, Blueberry Hill, Inc., DotKids, Inc., KIDS Domain, Inc. and ICM Registry Inc. These were categories Spectral Web covered in its statement issued on ICANN's previous public comment board.

__________________________________________________________________________

Statement prepared by Spectral Web, Inc.


       
     
     
     
     
     

 


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