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Username: first1
Date/Time: Thu, November 16, 2000 at 4:02 AM GMT
Browser: Netscape Communicator V4.75 using Windows 98
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Subject: Please Don't forget earlier posts!

Message:
 

 
snip!
Image Online Design, Inc.'s Response to ICANN's "Report On New TLD Applications" November 10, 2000

    ICANN's "Report on New TLD Applications" includes misinformed criticism of Image Online Design's application as well as several  outright errors. While we are pleased that we have been recommended for further consideration, and look forward to the negotiation phase as a forum to further educate ICANN on the merits of our proposal, we feel it necessary to correct the record in an open and public manner.

    We find it distressing that the five years of Image Online Design's history - including four years of operational experience in running a registry - is being ignored in this process. Particularly troubling is that ICANN should look unfavorably upon existing pioneers.  The report states that IOD's 20,000 registrants are "very modest," which contradicts ICANN's own criteria that list stability and experience among the most important issues in new TLD applications. Clearly, no other applicant for .Web has our experience as a pioneer registry. In this case, even "modest" is more than "none." With diversity and competition being among the most important criteria ICANN has chosen to consider, the complete disregard for IOD's long history in promoting competition as well as the fact that Afilias (another applicant for .Web) is comprised of companies that represent 98% of the existing market suggests bias in the information the report chooses to highlight.

    The report's technical criticisms of IOD are questionable in some cases and completely false in others. For instance, the report   criticizes IOD's staffing requirement of 70 people, yet fail to criticize the other .web applicants for the same requirements. The report criticizes IOD for currently having only one technical employee now, but don't fail to mention that the other two .web applicants list no technical employees. The report falsely states that IOD's registry will provide 28.6 TPS, which is completely incorrect.  Other technical misrepresentations are abundant.

    In terms of finances, The ICANN report also criticizes the fee IOD stated in its application for registry services. That fee, $15 per name, was selected after much thought and research.  However, we feel that market should decide. If, as some suggest, $15 is too high, the market will indicate that and we will lower the price.  It is also important to note that the $6 fee that Network Solutions currently charges is based due to the fact that, for the many years it enjoyed a monopoly, it charged $35 per name per year.  Only because NSI's infrastructure is bought and paid for is the lower cost possible. It should also be noted that Afilias , is charging $6 per name, but shows a loss on their application's financials for the first four years of operation. We fail to see how a registry that loses money year after year can be considered stable. The ICANN staff report also criticizes our assumptions with respect to market share, but fails to substantiate these disagreements, as the independent reports by ICANN's financial consultants has not been made public.
   
    In the absence of any evidence, we must respectfully disagree with ICANN's criticism. That said, however, IOD is fully prepared to work with ICANN on any financial disagreements with the goal of reaching a workable projection. This, in our mind, is a key item for the negotiation phase, which we understand from the staff report that we are to shortly enter. We look forward to resolving any problems or disagreements that may remain.

    The report also inaccurately represents IOD's funding levels.  IOD's application shows financial commitments of $2 million   immediately, $6 million when accepted, and a credit letter open to discussing any additional amount necessary. IOD has already spent    approximately $1 million in creating its registry, and has existing infrastructure that the other applicants have yet to even purchase,   much less install and test. The ICANN report presumed that the figure of $450,000, which represents cash-on-hand, was the sum and total of IOD's funding. This is, plainly, not the case. IOD has clearly shown that it is sufficiently funded to operate our registry over the past four years.

    Finally, the question has been raised as to the six-month timeframe for accepting registrars other than ourselves. IOD had anticipated that it would take six months to finish development and testing of its registrar protocol system, but in the light of clear consensus that this time frame is too long (as expressed directly to IOD as well as the numerous comments on the ICANN public comment forum), we are now committed to 30 to 60 day time frame. NeuStar, another applicant, has listed six to nine months as their timeframe.  Afilias,initially against outside registrars who were not "bought-in" members, has said that they would accept new registrars, but has failed to provide a timetable. While ICANN acknowledges this commitment, it chooses to not consider it, calling it a significant change to the application. It is disturbing that this is how constructive responses to valid criticism are treated. Of course, there was no criticism of either Afilias or NeuStar on their plans or timetables.

    ICANN's report seriously misrepresents the technical and financial merits of IOD's application, and shows that there is no technical or
financial criticism that stands up to scrutiny. It is our sincere hope that ICANN is not merely laying down the groundwork to refuse IOD's application.

HERE IS ANOTHER:

SNIP!
The more ICANN writes against IODesign, the more they expose themselves for who and what they truly are.

    In the beginning of this process I had the false hopes that ICANN was going to be objective in it's accessments of the applications. However, to the contrary, ICANN has attacked IODesign in every turn by using IODesign as an example in legal postings, refusing to require the recusal of Ken Stubs (ICANN says he only consulted them before    Yokohama "Yeah Right")

    Here are a few snippets from ICANN's application that I find most disturbing:

    ICANN >>> Based upon its historical experience, IOD has not demonstrated the ability to grow, even when performing other services, such as web hosting and design.

    <<< IODesign has already stated that it decided to forego webhosting and design in order to focus upon building the ".WEB" registry.

    ICANN >>>  Moreover, two of the four employees, the Chief Executive Officer and the Chief Operating Officer, are performing two roles. The planned management is working at Toyota San Luis Obispo as the Chief Executive Officer and Business Manager.  This dual responsibility could potentially become problematic for the registry operation.

    <<< First and foremost, ICANN fails to mention the large number of personnel relating to IODesign's subcontractors. Second, who is ICANN to dictate the number of roles a person holds in their professional lives? I run a successful technical consulting business, web hosting & design and online toy business.

    ICANN >>> Overall, the other applications in this group are significantly more realistic and would result in much more viable competition for the .com registry.

    <<< Realistic? Give us a break ICANN, Your assertions towards IODesign are completely biased and geared towards trying only to validate your self interested (Ken Stubs) reasons for not giving IODesign what rightfully belongs to them.

    I'll post more later but I gotta assume one of my other roles as Husband and Father!  

HERE IS ANOTHER:

SNIP!

Well ICANN seems to have said many unjust things about IOD, however the support from you chaps seems to have made a difference.

After reading this however, ICANN does seem to have been acting on some mis-information which is a little worrying at this late stage.

Here is the link and the text follows with my comments in addition:
                  
                   http://www.icann.com/tlds/report/report-iiib1a-09nov00.htm


                 Note about Image Online Design

Both the business/financial team and the technical team each independently concluded after the threshold review that the application from Image Online Design,Inc. did not justify further evaluation. However, because of the large number of favorable comments in the ICANN Public Comment Forum, the ICANN staff requested that the evaluation team examine Image Online Design's application more closely in the evaluation process.


Well at least someone is listening. It is a worry that thy didn't look into the application closely in the first place though.

Operation of a large registry will require substantial technical and managerial resources. A failure of a new TLD to service the global community of registrars and registrants could fatally damage its reputation and the likelihood of its successful adoption by the public, and therefore its ability to be a vigorous competitor with .com. It could also seriously damage public confidence in new TLDs that could be introduced in the future.


This is true and as a Network Solutions customer I can confirm this. It is good that ICANN has noted that it is not just sufficient to run the registry - a higher level of service is expected too.


Image Online Design proposes to operate a very large registry that will compete directly with .com. Currently, Image Online Design's registry operation is very modest(20,000 names) and, not being part of the DNS root, experiences little traffic.

A comment here from Chris Ambler would be useful but I seem to remember the figure being 15000 when the application went in and 18000 about a week ago. While the numbers are not significant in themselves it does indicate that public confidence in IOD is strong and getting stronger. Don't forget the 5000 applications over the last month or so are from people that have read all three applications and decided which is the better one.


In its application, Image Online Design identified the need for a staff of approximately 70 during its first year of operation. (Although this staff size is larger than other large domain applicants proposed, this appears to be because Image Online Design will act as both registry and registrar initially.) Image Online Design identified only three employees who would form the core competency team of the  expanded company. Only one of the "core" employees has technical experience.
                
The principal experience of the other two, the CEO and the COO, is in the operation of auto dealerships; their experience in technical management and operations comes from their experience at Image Online Design's currently modest registry operation. Image Online Design's  proposal describes a hiring plan to fill other executive positions. Its proposed staffing plan for other personnel is premised on hiring from colleges located in the vicinity of San Luis Obispo, California. In contrast, other applicants explicitly identified mature, capable teams and large pools of managerial and technical talent to draw upon.

Come on ICANN - this is a lose lose situation you're offering. They have more staff than the other applicants but it is not enough? You know as well as the rest of us that they can attract the tallent. The only reason that Afilias can attract the tallent before they get the domain is because they already run other domains - thats why they have large pool of managerial and technical tallent lying around.


Image Online Design proposes to support both registry and registrar functions during the first year,3 including during the start-up period. It has proposed no demand throttling mechanism to control initial load from the expected "land rush" during this period. In the judgment of the technical team, the small pool of talent available to Image Online Design is a very serious deficiency in Image Online Design's proposal. Given the lack of identified technical and management resources, the technical evaluation team concluded that there is a very significant risk that Image Online Design will not    be able to react quickly to unpredictable surges in demand, especially during the critical startup period. A failure to service a global customer base on a 24x7 basis, particularly during the initial startup period, could fatally damage the reputation of the new TLD.

So really if they identify the tallent thay intend to use and explain the technical support arrangements there are no problems with the application at all???

Since the assessment the IOD web pages have already been updated and the site is now very much more streamlined and "professional looking".

It is good that in this section ICANN seems to display a genuine concern for the well being of the internet - it reads very differently  from the other sections - different influence perhaps??

Nevertheless it is damaging to ICANN if they suggest that IOD cannot do the job just because they are not already running the domain.

Perhaps to this extent, if ICANN is genuinely concerned over this point, a trial period is in order? If the whole thing doesn't run well then reserve the option to pull it back.

If ICANN witholds .web from IOD and then Afilias has even the slightest hiccup (much like NSI are having at this very moment on their own web site) then ICANN will be held accountable and IOD will always be the better company that was never even given the chance because of all the conflicts of interest. That could prove very       expensive for ICANN and very damaging for the internet.

It might be useful at this stage if ICANN submit to IOD a list of demands. Criteria that must be met in time for the meeting and vote. Most of the critisism aimed at IOD is based on inacurate data (the capital they command for example is not $0.45M but $2.0M and $6.0M when the domain is granted. These are big differences that ICANN overlooked. No wonder the financial section wasn't impressed. They were out by over five and a half million dollars in their calculations.


Despite this new competition, moreover, Image Online Design anticipates maintaining its $15 registry price throughout the forecast period.


This is not true! ICANN is aware of this already.

The $15 fee was in comparison with Network Solutions Fees ($35 when I
registered). IOD have said that the market will determine the fee. This is obvious really. NSI didn't drop their fees until there was some competition in the market and then they had to or people would shop elsewhere. That is the case here.


This is at least two and a half times the registry prices anticipated by others in this category.


Afilias already has 98% market to buffer a four year month on month financial loss. Ho do you expect the likes of .per to compete with that?


This higher price is likely to deter registrars and potential registrants.


I disagree but if this were the case it would hardly last for very long before the price came down would it?


In addition, with any new venture there are always many unknown factors that will occur. For this category, becoming a viable competitor within the existing structure is key.


IOD already do this and for five years the unknown factors have been when the registry would be activated. They've done pretty well so far.

Holding only $450,000 is a significantly weaker capital position than the capital positions of the other applicants.


On one on earth can offer a significantly stronger capital position than the other players in this field. That is the point! Its always the point. Hoover was richer than Dyson but they did okay there. GM was second in line to Ford but they're managing. AMD was overwhelmed by Intel but they muddle through!

Imagine if Bill's bank manager has said "I'm sorry Mr Gates but this "computer" field you're interested in is full of firms more successful than you already".


Finally, based upon its historical experience, Image Online Design has not demonstrated the ability to grow


This is an emotive topic. Who's fault is that? They are a domain register that has been down trodden and knocked back for four years. You cannot hold this against them. The've done better than any other company in this situation on earth!


Overall, the other applications in this group are significantly more realistic and would result in much more viable competition for the .com registry.


Finally, this is the phrase that may well come back to haunt you at ICANN.

So many of us can see that it is not true I cannot believe that you are so blinkered! HOW can giving .web to Afilias that already commands almost 100% of the internet through its members result in much more viable competition for the .com registry???

In any case it is not the domains that are supposed to have the competition (there are already over 160 of them) but the companies that run the domains (Afilias controls almost all of them).

There is only one right pathway now. IOD should run .web and if ICANN is genuinely concerned for the wellbeing of the net then negotiate with IOD targets that must be met. Do the same with Afilias and .info then we'll see who is realistic!
                    
                      
I was so happy about these posts because I AGREE! and I don't want them to go unnoticed.
Thank you
Steven Arnold     

 


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