RE: [ga] New gTLD Applicant Guidebook Version 2

[George Kirikos <gkirikos@xxxxxxxxx>]

Hi Jeff,

--- On Thu, 2/19/09, Neuman, Jeff <Jeff.Neuman@xxxxxxxxxx> wrote:
> The author's post seems to boil down to a concern for
> the renewal price
> of a domain name, as that price could potentially
> disadvantage a
> registrant who has built up brand equity in its domain
> name.  NeuStar
> sympathizes with this comment and has suggested to ICANN
> and others in
> numerous conversations that perhaps a cap on renewal
> pricing for all
> TLDs is appropriate and warranted.  After all, if the

Renewal price caps are a basic protection mechanism, and would be a start 
towards increased price protection. However, they are not enough.

In particular, registry operators would be incented to find ways to get 
valuable domain names deleted, so that they could raise the prices. For 
example, Afilias implemented a .INFO Abuse Policy:

http://www.circleid.com/posts/86215_potential_danger_ahead_dot_info_policy/

which gives it sole discretion to define what constitutes "abuse." If that 
policy was widespread in important registries, I would not want VeriSign 
deciding whether one of my domain names was "abusive" when they know that if 
they made that determination, they could raise the price on one of my dot-coms 
from $7/yr to $1 million/yr. I'm sure Google, Yahoo, Microsoft and others would 
feel the same way (Afilias, for example, gets to have sole discretion over the 
definition of spam, and certainly all the companies in the world that have 
user-generated content, free webmail, or webservices that are subject to 
hacking would be at risk; e.g. your Apache webservers gets hacked, you get 
flagged as "abusive" and the registry seizes your valuable domain to auction 
for more money).

Furthermore, all expired domains would effectively be able to be auctioned by 
the registry operator (i.e. through setting higher than normal registration 
prices, like .tv). Once again, this is asking for a handout, a change to your 
contract that only benefits Neustar. You signed a contract with ICANN, and are 
looking for more. What are you giving up in exchange for "more"? You're giving 
up nothing.

Those are the one-sided contract changes that the registry operators always 
seek. That's why the only solution is regular tenders for operation of the 
registry, just like the DOJ suggested (and which I've long advocated). Registry 
operators could compete to run .com or other gTLDs, and whoever bids the lowest 
(for a fixed level of service performance specified in the tender) wins the 
contract. Very basic stuff that companies do all the time in procurement, but 
apparently too basic for ICANN, because there's no money in it for ICANN. The 
process is so simple that it doesn't require an annual $60 million budget and 
hundreds of staff.

Notice with tenders, there are no incentives for registry operators to seize 
valuable domains, since they're all the same price. All the benefits flow to 
the consumers. Competition between prospective registry operators maximizes 
consumer benefits, and registry operators receive "normal" profits. The most 
efficient registry operators will be the ones to be awarded the contracts, 
since they can operate the TLD at the lowest cost.

Until there's a Domain Registrant's Statement of Rights that gives registrants 
far greater protection than exists today, you'll have to get in line behind us 
when looking for one-sided contractual changes.

Sincerely,

George Kirikos
http://www.leap.com/