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
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
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:
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.
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
HERE IS ANOTHER:
Well ICANN seems to have said many
unjust things about IOD, however the support from you chaps seems to have made a
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:
Note about Image Online Design
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.
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.
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.
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
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
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.
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
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.
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.
$15 fee was in comparison with Network Solutions Fees ($35 when I
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.
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?
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
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.
$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!
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".
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
Overall, the other applications in this group are significantly more
realistic and would result in much more viable competition for the .com registry.
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
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.