Fwd: Re: [registrars] Re: FW: ICANN per-name fee at start of AGP vs at exit.

[Paul Goldstone <paulg@xxxxxxxxxxxx>]

All,

I understand there are differing opinions, but since it appears that 
ICANN, Neustar and Afilias are moving forwards with their individual 
plans to reduce bulk domain tasting, I think it's important that we 
speak up with any suggested changes to those plans before it's too late.

Correct me if I'm wrong, but at this point ICANN is not even 
mentioning a threshold, and none of the 3 organisations mentioned a 
discretionary allowance.  Both of which seem like good ideas to me.

Regardless of individual opinions on domain tasting, opinions on the 
recent ballot, which way the votes went, and whether we're for it or 
not, it seems like we WILL start getting charged for some or even ALL 
AGP transactions.

Assuming that changes are inevitable, do any other registrars want to 
vote on making sure we have a threshold and possibly a discretionary 
allowance or have any other suggestions, or is everyone else happy 
with the current proposals?

Best Regards,

~Paul
:DomainIt


>Date: Thu, 31 Jan 2008 22:31:46 -0500
>To: Paul Stahura <Paul.Stahura@xxxxxxxx>
>From: Paul Goldstone <paulg@xxxxxxxxxxxx>
>Subject: Re: [registrars] Re: FW: ICANN per-name fee at start of AGP vs
>  at exit.
>Cc: Registrars Constituency <registrars@xxxxxxxxxxxxxx>
>
>Paul,
>
>I completely agree with your statements, and appreciate the time you 
>took to post them to the list.  Jon Nevett recently asked for comments 
>on what the thresholds should be, gave a point of reference to ICANN's 
>current fee reductions, and a few people have already commented.
>
>I made an initial suggestion of somewhere between 3-5% of new 
>registrations for the current (or previous) month, plus the option for 
>discretion in special cases where the registrar could prove that they 
>were dealing with testing or fraud. This is a model Nominet has in place.
>
>Since this affects all registrars in such a major way, hopefully there 
>will be a lot more suggestions.
>
>Rather than wait to see what the ICANN budget looks like, risk having 
>to vote against it, then go back and forth, do you think it would be 
>beneficial for us all to agree on a reasonable threshold and send a 
>statement to ICANN ahead of time, or at least have that available for 
>the meeting in Delhi?
>
>To your other point, although the loss from a chargeback for a 
>non-refundable fee is clearly a major concern, I wanted to mention 
>that my credit card processor does not charge a separate fee for 
>chargebacks.  My previous processor charged a whopping $15!  If anyone 
>is interested in comparing their rates against what I pay, feel free 
>to contact me off list.  Who knows, maybe I'm the one overpaying and 
>will end up with a better overall rate. :)
>
>Additionally, we implement many of the fraud detection procedures that 
>you mentioned, and I think it would be of great benefit to all 
>registrars if some of us were willing to discuss and share that 
>information.  I can see it starting out as a discussion and sharing of 
>procedures, and perhaps even evolving to sharing known data about 
>fraudsters.  I think this suggestion actually came up once or twice 
>before.  Needless to say, it would not be appropriate to discuss those 
>matters in a public forum, but I wonder if we should get a group of 
>people together who want to do so off list.  Any takers?
>
>~Paul
>:DomainIt
>
>
>At 06:15 PM 1/31/2008, Robert F. Connelly wrote:
>>At 02:32 PM 1/31/2008 Thursday  -0800, Paul Stahura wrote:
>>>I don't see this on the list yet?. Am I having trouble sending to the list again?
>>
>>Dear Paul:  I'm checking the RC list to see if you are on it with this email address.  I suspect we have your old address.
>>
>>In the mean time, I've posted your comments to this list.  Regards, BobC
>>
>>
>>> 
>>>From: Paul Stahura 
>>>Sent: Thursday, January 31, 2008 11:02 AM
>>>To: 'registrars@xxxxxxxxxxxxxx'
>>>Subject: ICANN per-name fee at start of AGP vs at exit.
>>> 
>>>We registrars need the AGP.  We all know we do.  But let me explain why in case others who may read this post do not know why we do or how its used.
>>>The AGP allows registrars to combat fraud.  
>>>When users requests a registration, we registrars do not know if the users intend to 1) pay us or 2) use the name for a purpose which violates our acceptable use policies (such as to spam).  The registration is probably legitimate, though we don?t know for sure, and users demand fast registration service, so we register the name for the user in real-time.
>>>Now we (at least eNom, and I?m pretty sure most registrars) do not just wait 6 months to see what happens.  Wait and find out if the credit card was stolen.  If the user spams like crazy.  What we do (again at least eNom but probably most registrars do this) is score each registration.  We use email addresses in the whois, source IP, account, and other metrics in an attempt to figure out the intent of the user.  We automate this as much as possible but it still takes human judgment (our fraud prevention departments) to take all these data points in.  This takes time; though we try to do our checks as fast as possible.  Some we can do fairly quickly, others, takes days.  Five days was (and still is) a reasonable amount of time for us to do our checks.  If we determine that the user will not pay us or is likely a spammer,  we delete the name, and do not charge the card, or refund the fee if it was charged.  Obviously its in our economic interest to charge the cards as soon as possible.  This is the entire purpose, in my opinion, of the AGP.  It?s not to correct misspellings.  It?s to prevent fraud and reduce a high chargeback rate on registrars (because in many cases the credit card is not even charged, so therefore there can be no chargeback).  I know some registrars have had to pay millions of dollars in fines in the past for high chargeback rates (which is why I?m fairly certain we?ve all evolved our own, probably similar, fraud scoring systems).  This is not a trivial amount of money.
>>> 
>>>OK so ICANN wants to charge the per-name fee on the day the name is registered and not on the day names exit the AGP.  If this happens, then we will be paying ICANN for names which we delete due to a high fraud likelihood.  I propose ICANN charge us only after a reasonable number of names (after a threshold number).   This number can be on an absolute per-cred-per-time (per day, month whatever) basis or on a percentage basis (based on the number of names exiting the grace period).
>>>Without a threshold I will be voting against the budget and I urge you to do the same.    The egregious ?tasters? were doing hundreds of thousands to millions of names per day. A threshold which is orders of magnitude under this (and at the same time, orders of magnitude above the number we delete in our fraud-fighting efforts) will eliminate the giant ?tasters? (whether or not you agree on tasting as a legitimate business practice) while allowing us to continue to keep our chargeback rates low and reduce fraud without increasing the dollar burden on us.
>>> 
>>>I look forward to discussing this with you further on this list and in India.
>>> 
>>>Paul
>>> 
>>
>>~~~~~~~~~~~~~~~~~~~~~~~
>>After all is said and done ---
>>A lot more gets said than done;-}