ICANN Board Unanimously Approves Controversial Org/Info/Biz Contracts

[Ron Jackson]

Just got the note below from Phil Corwin, Legal Counsel for the Internet Commerce Association who is at the ICANN meeting in Sao Paolo, Brazil. Despite almost unanimous opposition the ICANN board has unanimously approved the new gTLD contracts for .org, .info and .biz:

"After one hour of discussion the ICANN Board approved this morning by a 13-0 unanimous vote of all participating members to approve the revised gTLD agreements as published in October. Key reasons for taking action at this this time was the failure of the GNSO Council to complete its PDP process on registry agreements and the recent approval of the .com agreement and the consequent desire for uniformity in these agreements. The need to provide incentives for registry investments in security was also a key factor cited by several Board members. The meeting is still ongoing. I will provide a much more detailed memo on the Board discussion this weekend after I return to DC." - Phil Corwin, ICA

One word comes to mind - disgraceful. While the registration price increases embodied in these agreements is bad news for everyone who owns a .org, .info or .biz domain name (as well as .com, .net and .org because as Phil noted, the Board intends to give all registries similar contracts), at least it ends ICANN's charade that they are committed to ground up consensus policy-making. The registries clearly have complete control of the Board and their wishes are being granted regardless of the expense to the rest of the Internet community.

 

[DJ]

Unbelievable ...

Anything left for us to do?

 

[Dave_Z]

Sigh, it appears suing ICANN's the only answer to force the issue.

 

[zestydomains*com]

This is truly outrageous.

One has to wonder how ICANN could unanimously ignore the public commentary on these issues? To imagine that almost 100 percent of the public comments were against these contracts, and that in only one hour they are discussed and publicly approved unanimously by the ICANN board is unbelievable. Truly unbelievable...

What a pity it is that our industry's governing board unabashedly cares so little about those it has been called upon to support.

- zesty

 

[SKG]

U.S. Department of Commerce Approves VeriSign’s .Com Agreement

VeriSign

VeriSign announced today that their new .com contract agreement with ICANN has been approved by the US Department of Commerce. Due to the contract, domain registrants will have to pay higher registration fees soon. New contracts for the .org, .info and .biz TLDs have already been announced, but they have been opposed by registrants. The World Association of Domain Name Developers (WADND) had filed a lawsuit against VeriSign and ICANN in November 2005, claiming that the two companies would “have engaged in antitrust activities, including conspiracy, monopolization, illegal price fixing and monopolizing .com and .net domain name markets.” However, the WADND could not continue the lawsuit, because the domain community had not contributed enough money for it.

VeriSign’s official press release:

Department of Commerce Approves .Com Agreement

MOUNTAIN VIEW, CA — (MARKET WIRE) — November 30, 2006 — VeriSign, Inc. (NASDAQ: VRSN), the leading provider of intelligent infrastructure for the networked world, today announced that it received notification from the Department of Commerce that it approved the .com agreement submitted by the Internet Corporation for Assigned Names and Numbers (ICANN).

Since 1999, VeriSign has operated the .com registry with 100 percent uptime even as Internet traffic has grown dramatically. Today, VeriSign’s primary computers for .com can handle 10,000 times the DNS query volume they could in 2000.

“The registry operator framework ICANN has adopted and embodied in the .com agreement strengthens the security and stability of the Internet relied on by hundreds of millions of people around the globe,” said Mark McLaughlin, Executive Vice President and General Manager, VeriSign Information Services. “This framework holds operators accountable for their performance, promotes the continued investment of tens of millions of dollars in the infrastructure and provides important safeguards for consumers.”

About VeriSign

VeriSign, Inc. (NASDAQ: VRSN) operates intelligent infrastructure services that enable and protect billions of interactions every day across the world’s voice and data networks. Additional news and information about the company is available at www.verisign.com.

Forward-Looking Statement

Statements in this announcement other than historical data and information constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements involve risks and uncertainties that could cause VeriSign’s actual results to differ materially from those stated or implied by such forward-looking statements. The potential risks and uncertainties include, among others, the uncertainty of future revenue and profitability and potential fluctuations in quarterly operating results due to such factors as the risk that VeriSign’s announced strategic relationships, including the relationship described herein, may not result in additional products, services, customers, profits or revenues; and increased competition and pricing pressures. More information about potential factors that could affect the company’s business and financial results is included in VeriSign’s filings with the Securities and Exchange Commission, including in the company’s Annual Report on Form 10-K for the year ended December 31, 2005 and quarterly reports on Form 10-Q. VeriSign undertakes no obligation to update any of the forward-looking statements after the date of this press release.

VeriSign and other trademarks, service marks and logos are registered or unregistered marks of VeriSign, Inc. and its subsidiaries in the United States and in foreign countries. Copyright © 2006 VeriSign, Inc. All rights reserved.

Domainers still have the chance to fight against the new .org, .info and .biz contracts, although this fight might be more difficult now that the .com contract has been approved.

 

[Ron Jackson]

The initial word we got was that the org/info/biz contracts were approved as published in October, however a Yahoo news report says a late clause added to the contracts is designed to prevent variable pricing for domain name registrations and renewals (charging different prices for different domain names).

The article says "Critics had worried that without such a provision, an operator could potentially raise prices when a company tries to renew an easy-to-remember or trademarked name. Friday's decision clarifies that the board opposes variable pricing and indicates that similar clauses are likely for other domains as contracts get renewed."

Opposition to variable pricing was an especially sore point of course, but critics were also adamant against the stiff price increases (up to 10% annually) allowed by the contracts at a time when the cost of providing registrar services is falling. Other qualified companies are willing to provide the same service at lower prices but were not allowed to compete with the current registries for the contracts.

 

[labrocca]

F'in unreal! Could this be the beginning of the end for domain speculators? At $2-$8 per registration many throw money out there...but at $25-$100 PER YEAR...will the same group spend the money? I think 90% of domainers would drop out and so would 90% of the domains that are already registered and parked.

I can't even begin to fathom how in the next few years this new contract will change the landscape of domainers. I have had domains since the late 90's and now I wonder what will happen to some of my long-term sites that don't make more than $100 a year...will I be forced to drop them? WTF....if someone else takes it what about my rights to the name that I spent 10 years building? All bullcrap!

 

[Sam]

At least we got variable pricing removed... of course I dont speculate much in the regular gtlds anymore... so this news doesnt affect me much but still disgraceful. How can you INCREASE prices when the COST goes down??

 

[Ron Jackson]

At least we got variable pricing removed...

Unfortunately that is not the case. The Yahoo news report turned out to be wrong. As we reported before the Yahoo report came out, there was no change at all in the contracts from the last revisions in October as proven by the minutes minutes from ICANN.org: http://www.icann.org/minutes/resolu...tm#_Toc27198293 which state:

Approval of .BIZ/.INFO/.ORG Registry Agreements

Whereas, on 24 October 2006, ICANN posted revised proposed registry agreements including a new restriction on the use of "traffic data" and the acceptance of 10% caps on price increases by the .BIZ, .INFO, and .ORG registry operators <http://www.icann.org/announcements/...ent-24oct06.htm>.

Whereas, the Board has carefully considered the revised proposed agreements, and the public comments and the registry responses, and finds that approval of the proposed new agreements would be beneficial for ICANN and the Internet community.

Resolved (06.___), the proposed .BIZ, .INFO, and .ORG registry agreements are hereby approved, and the President is authorized to take such actions as appropriate to implement the agreements.

Without a clear requirement for uniform pricing (or a clear prohibition of variable pricing) they can still have variable pricing under the 10% price cap (which could have some domain owners paying as much as double what others pay by the end of the contracts). With the right result from the "independent" pricing study they talked about conducting, it's also possible they could amend the contracts and eliminate the 10% cap and have unlimited variable pricing. They amend agreements all the time - as they did recently in letting the .org registry institute an "excess deletion" fee to combat tasting.

F'in unreal! Could this be the beginning of the end for domain speculators? At $2-$8 per registration many throw money out there...but at $25-$100 PER YEAR...will the same group spend the money? I think 90% of domainers would drop out and so would 90% of the domains that are already registered and parked.

I can't even begin to fathom how in the next few years this new contract will change the landscape of domainers. I have had domains since the late 90's and now I wonder what will happen to some of my long-term sites that don't make more than $100 a year...will I be forced to drop them? WTF....if someone else takes it what about my rights to the name that I spent 10 years building? All bullcrap!

I think it is a legitimate concern. ICANN turning the keys to the store over to the registries is now the single biggest threat to domain owners IMO.

 

[wasistdas]

Well, it will call more companies and communities to launch more zones and compete with those.

 

[drmaximus]

Been out of touch with this biz for the past 6 months or so... but are there any new reports on this issue? Or is the last word still that we're screwed?

 

[Carlton]

Been out of touch with this biz for the past 6 months or so... but are there any new reports on this issue? Or is the last word still that we're screwed?

ICANN approved an up to 10% per year registration fee increase on biz/info/org extensions. Some consider it an acceptable compromise - myself included. The hugely corrupt and unregulated tiered-pricing scam (that domain owners feared) was justifiably shot down. A lot of energy and good will went into preserving security measures that greed and incompetence nearly ruined.

Biz/info/org stakeholders had to work together to help ICANN do their job. And the biz/info/org registries ... :td: ... showed they have no genuine regard for the people and businesses that breathed life into these extensions.

Continue to watch ICANN's moves. Their biggest challenge is maintaining a fair and impartial administration of DNS issues. Never assume integrity. Allow it to be proven.

 

[drmaximus]

ICANN approved an up to 10% per year registration fee increase on biz/info/org extensions. Some consider it an acceptable compromise - myself included. The hugely corrupt and unregulated tiered-pricing scam (that domain owners feared) was justifiably shot down. A lot of energy and good will went into preserving security measures that greed and incompetence nearly ruined.

Biz/info/org stakeholders had to work together to help ICANN do their job. And the biz/info/org registries ... :td: ... showed they have no genuine regard for the people and businesses that breathed life into these extensions.

Continue to watch ICANN's moves. Their biggest challenge is maintaining a fair and impartial administration of DNS issues. Never assume integrity. Allow it to be proven.

That's very nice to hear, and I am grateful for your update. I think too that 10% p.a. sounds reasonable compared to the other possibility. Thanks Carlton!