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New gTLD Expressions of Interest: Proceed with Caution

The ICANN Board, at its October 2009 annual meeting in Seoul, passed a resolution directing staff to prepare an analysis regarding the feasibility of ICANN soliciting Expressions of Interests (EOIs) from prospective applicants for new Generic Top Level Domains (gTLDs). ICANN staff subsequently opened a public forum seeking input from the community on a number of questions. While this latest initiative should not distract ICANN from the remaining four overarching issues, if well executed, this EOI initiative could provide valuable insights into two of the four overarching issues: economics and root scaling. But if executed improperly, this EOI initiative will likely erode confidence in the new gTLD process and negatively impact ICANN's evaluation in the upcoming reviews under ICANN's new Affirmation of Commitments.

Let's Have a Bottom-Up, Not Top-Down Process

One of the core principles enshrined in the ICANN model is the bottom-up consensus-driven process. This process, however, is a double-edged sword: While inherently noisy, contentious and time consuming, when consensus finally emerges from this cacophony of competing voices (public and private) the results are generally well founded principles and policies that respect the global public interest. As ICANN moves forward with the Seoul EOI resolution, the legitimacy of its final action must learn from the same bottom-up community consensus processes that were followed in the 2000 Proof of Concept new gTLD round and the more recent Internationalized Domain Names (IDNs) ccTLD Fast-Track round.

A full copy of the article is available below or as a PDF document from the PFF website.

By Michael D. Palage, Intellectual Property Attorney and IT Consultant

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Comments

Spoken by a true lawyer By Constantine Roussos  –  Nov 18, 2009 2:44 pm PDT

Sorry Michael but I see your self interest here.

.music have been doing a lot of outreach efforts as well as sponsoring events left and right. I would like to invite you to the San Francisco Music Tech Summit to explain to the music community your thoughts why they must wait longer since you believe there is no demand.

I have a question for you. What do you think of inventions or patents or copyrights? The first person that submits these gets them right? All inventions and entrepreneurs front run every day and take risks. Why does the concept of front running bug you so much? Why does the concept of applicants such as myself conduct outreach campaigns and alert millions of music users and the internet community? Do you think ICANN is the only responsible for outreach levels and marketing of new gTLDS?

See it this way. The music community does not care about the guidebook. It is pretty much set. All they care about is getting their .music domain and using the music.us platform to get their music out globally. Do you really think the guidebook will change that much? Do you think the final guidebook will change that much that will make new applicants get in the game this late? Without risk?

I will give you some REAL information about this whole ICANN process. This is what you state:

"The prospective TLD applicants need to know the identity of the strings so they can raise money, being marketing a TLD, taking expressing of interests from prospective registrants (aka pre-reservations)—all before ICANN and the global Internet community has been able to comment on and approve the final Applicant Guidebook"

And who is the global community? Take most of the comments that ICANN takes is from ICANN community people, not the public. You my friend are part of a minority. People just want to get their names. Lawyers such as yourself just want to complain and assume that there has no outreach efforts. That is quite an insult to our campaign. 1 millions signatures and 300,000 twitter followers across our accounts. Oh yea, we just surpassed 40,000 people on myspace the other day? Did I tell you that the .music initiative is #42 on Google for the term "music"?

I look at the 4 overarching issues you complain about and let me tackle some of them for you:

Economic Demand
There is economic demand for .music Once again I invite you to the SF Music Summit in December, Midem.com conference in Cannes in January, Harvard in Feb, SXSW in March and Musexpo in April to tell musicians that there is no economic demand. We will be there. Whenever I hear this, it gets my temperature boiling. By the way, I have not been an ICANN guy until June 2008 when the announcement was made. Im not an insider and I certainly found out about the process online and via the media. ICANN has done their job with that. You say ICANN's credibility is in stake. Are you kidding me? We have been given dates that ICANN has pushed down. Guess what I had to say to all the music community emails I have received? I had to say it is pending ICANN and politics. Not only is ICANN's credibility being compromised, so has ours and all the other serious applicants.

Root Scaling
The EOI is perfect in determining the number of serious applicants. Your proposal of $100 is a joke. What do your employers pay you per hour? I would guess more than $100 and hour. I know I have invested millions in the music.us platform & .music. If you want serious players and solutions, then you need to be realistic. Registering a .mx domain costs more than $100. The guidebook will not change significantly enough to warrant such moves by potential applicants who might consider applying. We all know the risks. $100 is a joke of a price which really undermines your intelligence to talk about economics and statistics. You need serious applicants only. Not the time wasters. You need measurable statistics that is reliable and consistent with the ICANN fee: $185,000. You are asking for 1/1850 of the fee! That just invites a bad sample size given your weak hypothesis and false presumptions.

Registry/Registry Integration
With or without it, all applicants will still go for their applications. Regulations currently say that there is separation. Moot point here. This would not change anyone's opinion on applying.

Trademarks
As a musicians and entrepreneur, I am pretty passionate about intellectual capital. I dont think any decisions to protect intellectual capital will change anyone's opinion on applying.

If you have any comments let me know. I just don't want my time, money and my constituents' time wasted more because of people like yourself who dont understand much about innovation or entrepreneurs. If you believe in copyrights, patents, inventions then you should agree with me: in every business there is first-movers and risk takers. The risk is higher but if a success, the returns could be great. Have you ever owned your own business? Your views do not reflect the true internet community or biz. Just yours.

Musicians want their .music. Lets talk about self interests. I think its you who is front running for delaying the process regardless of result. I doubt you care about new gTLDs. Your employer might.

Give me one thing that could change in the new guidebook that would be so significantly bad for applicants or good for that matter? Any new additions in the DAG will probably be extra obstacles to the process.

I repeat: ONLY the serious ones remain and persist. Even without a date.

Constantine Roussos
.music
.music on Twitter & other .music twitter accounts
.music on Myspace

Not Sure I See Your Point By John Berryhill  –  Nov 19, 2009 8:03 am PDT

Mr. Roussos, the article seems to be directed toward not letting the TLD process be sidetracked by the "Expressions of Interest" notion which has been proposed.  If the EOI idea is intended to address questions about demand, number of potential TLDs, types of TLDs, etc., in order to inform and facilitate the TLD process going forward, then it doesn't need to cost $100K+ and confer some sort of privilege to people who are willing to float that sort of money to ICANN for an indefinite period of time.  Let's get a rough head count, and move ahead.

It's not clear that your comments are directed to the subject matter to which the article is directed.  Getting a quick head count in a lightweight EOI process seems like less of a distraction than working out a "Guidebook For What To Do While Waiting For The Final Guidebook".

Hey John,I never assumed that waiting an By Constantine Roussos  –  Nov 19, 2009 9:16 am PDT

Hey John,

I never assumed that waiting an indefinite period of time was a good idea. My approach is to get things rolling and to separate the serious from the not so serious. I never said there will not be second rounds or anything like that. As a 2008 ICANN newbie I have not seen a "quick head count" type of process implemented by ICANN. It is the same people opposing the launch of new gTLDs (Palage for example always congratulating ICANN for any delays).

How can determining the real count be a distraction? Many players have left the gTLD lobbying efforts because they see that ICANN is not giving any dates about implementation. Do you blame them? There have been many because this whole "bottom-down process" is not as effective as one would think. It is a great idea but it is always a handful of people who write comments which do not represent the at-large web users. I looked at the business constituency. Do those really represent the interests of the whole world? It is an impossible feat and certainly while I appreciate the efforts by ICANN, the truth is that all comments made are represented by the ICANN few. Why? Regular users dont care that much or know enough. Why would someone stick around in ICANN processes and write comments on the same things for years and years?

The subject matter is the EOI. My view is let's get something going that is real and gives measureable results. Things can move ahead while the EOI is happening cant they? It is such a simple process. I think the issue here is the money. You either have it and can show a fair representation of the $185k ICANN fee requirement or you dont.

In my opinion the final guidebook should have been done already. All the overarching issues are not as complicated as one would think to solve. There is nothing "lightweight" about this process. However hearing people talk about "what benefits the web community" when all the people commenting are the same people and not the web community is quite funny to me.

I think the EOI is a great idea. Michael Palage has been talking about front running for a while know, even mentioning the .music logo that we created before 2008 for Music.us as a front running, creative approach to using the trademark law. Music.us has been operating way before the June 2008 announcement. Again I am not an insider. I just came in the process given what ICANN said publically in June 2008. I think everyone is tired of waiting and talking about the same things and issues.

I Agree With Most Of What You Say... By John Berryhill  –  Nov 19, 2009 10:36 am PDT

Mr. Roussos, I agree with most of your commentary and observations about the ICANN process above.  The Guidebook should have been completed, as one of ICANN's formative purpose was to establish conditions for entry of new TLD's into the root.  Your situation strikes me as an example of why end users would be disadvantaged by an EOI process that establishes an insider advantage.

It would be one thing for the Guidebook to be in final form, so that those interested in running a TLD for whatever purpose would know what they were getting for their $185K.  The scenario taking shape looks as if, for example, there will come a point, maybe next year, maybe the year after that, at which the Guidebook will be completed, and the world can credibly be invited to apply for new TLDs (for whatever insane reasons they might have).

At that point in time, making that offer with an asterisk saying, "Oh, by the way, preference will be given to insiders who happened to know about a line-jumping procedure for a pig-in-a-poke back in 2009" looks a lot more like an insider-advantaged rigged game, than other alternatives.

If the goal here is to confer advantages to those who've been playing the ICANN insider game the longest, need I remind you that applicants in the 2000 round are proposed to obtain a fee reduction.  Now, you've done a great job in organizing a community around your proposed TLD, but the New.net application, which included .music, has been around for over nine years already.  (http://www.icann.org/en/tlds/tld-applications-lodged-02oct00.htm) Should they have an advantage over you for the simple fact of having been playing the ICANN game nine years ago?

For the same reason that you "just came into the process" based on the perception that new TLDs were imminently moving forward, and then found out that this thing has been a decade long tar pit, there may be others who would likewise be inspired by a "real" TLD process, but are unlikely to want to place a $185K bet on being jerked around for two years on the prospect of an unknown outcome.  There are, in fact, STILL folks waiting on their ship to come in on the basis of applications they submitted to Jon Postel in 1996, in the grand-daddy of TLD process false starts.

Everything you've said about ICANN rings true to me.  The thing is, when the Guidebook is final and prospective applicants who haven't been contestants in "Amazing Race - ICANN" are in a position to know what they are really getting into as a TLD applicant; then mark my words, you are going to be the one being accused of "privileged insider" status when it turns out that the bonus for paying attention to this insane circus is a secured spot at the front of the line.

But, hey, my crazier friends tell me the world ends in late 2012 at the completion of the current cycle of the Mayan calendar, so it would behoove us all to move this thing along.

Well if we have 2-3 years to By Constantine Roussos  –  Nov 19, 2009 3:56 pm PDT

Well if we have 2-3 years to live given the end of the world in 2012, then it is imperative we get this thing rolling.

I am the one to always say that competition is healthy. If the applicants from 2000 want to come forward and compete and be public about it that is absolutely awesome. I always push for transparency and outreach levels. One was today at the CTA meting in Los Angeles. I spoke to both Disney and Warner. Also spoke to Canadian Government today as well. Next up is the Aussies.

While I agree with some of your comments, I think the term "priveleged insider" is bogus. There is nothing insider about the activities I am embarking. it is called outreach. Your assessment is quite flawed. So base don your thinking, it is healthier for the ICANN process for the players to be in stealth and not involve the communities they are in nor get any feedback? I am quite inclusive of all the music community. We are talking about .music here. It requires full transparency and outreach.

I invite all the .music applicants or last-minute "TLD-goldrush" guys to come out and be public, be transparent about their plans as well as invite open competition. I believe your concept of insider is super flawed. You believe "stealth" is best? To perform an outreach to a community like music, it is not a 3 or 6 month endeavor. It has been over 2 years and counting and going. You can call it insider but I call it hard work, networking, connections, marketing and authentic outreach. I am not interested about the past or what people did in 2000. ICANN was different then and the Internet was different then.

So let's get all the players out of their "stealth" modes and in the open. Some TLDs require it. Some TLDs that are in the interests of a global audience and large stakeholder group. I am certainly more than willing to compete, go to auction or do whatever it has to take. I think many groups are ready to rock n roll. Let us get things rolling. However I repeat, you need a realistic, authentic and representative number to get crucial info about the process and for scaling purposes. I want this process going more than anyone. I believe the EOI gives valuable information to ICANN. Will it delay the process? Maybe. Everything is a risk. So you believe that piggybacking is a better alternative to some applicants being in stealth and not performing outreach efforts and being transparent? From an entrepreneurial point of view, I think the thinking is flawed. Insiders are the ones hiding and hoping noone finds out what they are doing - Hence the term insider information. I am not hiding any information from the music community, indies or majors. Rotating boards included and transparent governance.

There is no such thing as privileged status. I call it extensive outreach efforts, transparency, public support, marketing and everything else that comes along with it. I repeat: Some TLDs require extensive outreach efforts and not stealth operations. We can leave stealth operations to the military and the ones who will save us in 2012 - the end of the world as you call it. When is that movie coming out anyways?

You Continue To Miss The Point By John Berryhill  –  Nov 19, 2009 4:27 pm PDT

Well, color me confused.  The article you attacked is in FAVOR of an EOI process.

"I believe the EOI gives valuable information to ICANN."

...which is also discussed in the article.

There is nothing in the article which opposes new TLDs or an EOI process.

If you are so blessed as to have $185K lying around, or you are able to raise that from supporters who don't care when there may be a productive result, that's great.  The only difference betwee the product of the EOI Working Group Proposal, and the article above, is that the WG proposal shuts out anyone who doesn't have that cash on hand during a brief window to take a flyer on securing an insider privilege.

There are quite substantial companies who cannot justify that sort of gamesmanship to their boards or stockholders.  It's not a question of sneaky characters lurking in the shadows, it's a simple question of organizations that would rather know what they are getting into without having to ride the ICANN pony for an indefinite period of time.

Since the article favors an EOI procedure, what is it, exactly, that you find objectionable?

Hey John,I was not attacking the the By Constantine Roussos  –  Nov 19, 2009 5:03 pm PDT

Hey John,

I was not attacking the the article written here but pointing out some areas in the PDF attached which I thought were not aligned with reality and found objectionable, especially the front-running claims. You actually believe the overarching issues will change material enough to entice new applicants? Quite the contrary in my opinion. The risk all lies in the EOI applicants. Another objectionable part is the $100 fee. That is not aligned with the $185k fee. By the way, if you thought the only obstacle to launching and having a sound business model for new TLDs is $185k I think you are barely touching the surface, unless the goal is strictly one of gold-rushing and auctioning premium domains and then doing nothing (which I am against). I do not want to go into the financing of such a project but if anyone is complaining that the fee is too high, they should re-consider going after a TLD. I believe ones who are relying on registrations alone will at best break even if they sell 10-20k of registrations at a competitive price. Need to compare apples with apples and serious applicants with serious applicants. Only ones who I believe should get some slack from ICANN are communities that are economically challenged. However that will be hard to prove in my opinion. Non-profits? We are treading on dangerous water here since ICANN itself is a non-profit and thinking of implementing auctions.

By the way I loved the link about the previous .music applicant. Yup, it seems that in that same application, the applicant went for:

.ads
.agency
.aids
.air
.antiques
.art
.artists
.auction
.audio
.bbs
.books
.cafe
.cam
.card
.cars
.center
.city
.channel
.church
.club
.commerce
.computers
.consulting
.culture
.design
.digital
.direct
.dtv
.dvd
.factory
.fashion
.festival
.fiction
.film
.films
.foundation
.free
.fun
.fund
.funds
.gallery
.games
.gay
.graphics
.group
.guide
.hotel
.help
.history
.index
.insurance
.jazz
.jobs
.lab
.mad
.mag
.magic
.mail
.market
.media
.men
.monitor
.movie
.music
.news
.now
.nyc
.one
.online
.opera
.page
.partners
.people
.planet
.politics
.power
.productions
.projects
.properties
.radio
.records
.school
.service
.sex
.shoes
.shop
.show
.security
.society
.sound
.shareware
.site
.software
.solutions
.soup
.space
.sports
.star
.studios
.sucks
.systems
.tech
.temple
.theater
.time
.times
.toys
.trade
.travel
.voice
.war
.watch
.weather
.women
.world
.writer
.zine
.zone

I really have no comment for this kind of "applicants" but I am not surprised this particular one got rejected. Oh yea, this applicant runs his own alternate DNS root zone. So basically he has these names already. Only difference is, they are in his company's root, not what we call the ICANN root.

I know you have been in the domaining industry for a long time and you should know that first mover is important as well as risk assessment. I know all those big .com investors that spent money in the early 90s spent money that had the risk of whether domains would be a success. Did they have insider information? Not really. In the beginning anyone could register any domain for free. Then a higher price to register was introduced. Those people or may I say speculators believed in the domains and their investment risk. The rest is history. Entrepreneurs who took risks got the reward. I look at the sale of candy.com for a few million dollars. I say "I wish i was back in the early 90s and got all these .com domains" Even though I was too young to have a credit card back then I am sure a lot of people still say the wish they went back in time. Was there a risk for these people to spend their time and money on .com domains with no proven track record? Yes. Was it for the best interest of the internet community? Depends if you liked parked pages or not.

I found this letter to ICANN interesting By Constantine Roussos  –  Nov 20, 2009 2:47 pm PDT

I found this letter to ICANN interesting in response to Michael Palage's comments:

Source: http://forum.icann.org/lists/eoi-new-gtlds/msg00026.html

RE: New gTLD Expressions of Interest: Proceed with Caution

* To:
* Subject: RE: New gTLD Expressions of Interest: Proceed with Caution
* From: "A. Taylor"
* Date: Fri, 20 Nov 2009 11:02:56 -0800

In a letter posted to ICANN, former ICANN board member and now what appears to
be a paid lobbyist Michael Palage, repeatedly equates the proposed new EOI
process to "front running", and suggests that this "scheme" is for "self
interested parties to reserve a place at the front of line", to the detriment
of "applicants from developing countries and less financial resourceful
communities".

I did a bit of research on this, which I'd encourage others to do as well. 
Unfortunately many will take his writings as gospel.

Before going into the detail of Mr Palage's comments, it is important to note
that Mr Palage seems to be far from a "disinterested party". It appears from
review of the pff.org website that funding is being provided from the so-called
"Progress and Freedom Foundation", a Washington DC paid lobbyist firm, who's
clients include a who's who of anti-TLD voices, such as Verisign, AT&T;, Verizon
and Time Warner Inc. Despite the name, in my opinion this organization is
neither about progress nor freedom, but instead about protecting the entrenched
interests of incumbents, many of which are currently reaping millions of
dollars a year from the effective status quo monopoly on top level domains.

It is clear to me that Mr Palage is not an unbiased observer, but focusing on
his arguments, there are some troubling distortions that are not entirely
accurate. First of all, in page 4 of his 14 page diatribe on EOI's, he
formulates the equation: "EOI=Front Running". This terminology is repeated at
least 7 other times in the document, as if there was no possible doubt as to
the validity of the comparison.

Looking at Wikipedia, "front running" is defined as: "the illegal practice of a
stock broker executing orders on a security for its own account while taking
advantage of advance knowledge of pending orders from its customers."

The insinuation that the simple act of taking expressions of interest in new
TLDs is "illegal" or in some way is linked to fraudulent stock trading schemes
is – in my opinion -downright misleading. But, from what appears to be a paid
lobbyist representing hundreds of millions of dollars in paid monopolistic
interests, it is not unexpected.  Unfortunately the fact that it may be a paid
opinion is not reflected anywhere in what I believe to be an extremely biased
document.

In a nutshell, Mr Palages' 14 pages of arguments can be summarized in the three
points surrounded by attempts to taint the reader against new Top Level Domains
or the Expression of Interest process:

1. A price of 50,000 dollars is far too high for EOIs as the Applicant
Guidebook is not in final form, and smaller, disadvantaged applicants can not
afford it.

2. The EOI process will not be advertised and hence only insiders will get
access to it

3. A price of $100 for an EOI is more in line with ICANN "precedents"

Regarding point1, the application fee has already been fixed at $185,000. From
what I can tell, there has been no deviation of this in 3 DAG versions. In
addition, there are other substantial costs for prospective registrants -
making the total dollar commitment to undertake a TLD closer to 500k (including
registry fees, financial guarantees etc..).
In light of this, 50k is simply not material for serious applicants —
regardless of their background.

Regarding point 2, this is simply not true. Clearly, the EOI process, like the
application process itself SHOULD be widely advertised. I don’t see an intent
among the EOI supporters to have an "inside process".

Regarding 3, the price is simply absurd. First of all, even in 2000, contrary
to Mr Palage's insinuations, there was an application fee of around $50,000. Mr
Palage should know this, as it appears that he helped prepare several of the
(unsuccessful) applications. So there is no "precedent" of "no cost EOIs".
Clearly, the EOI proposal is in fact new and does not have any such "precedent"
-- so using this legal term is misleading.

More importantly, a price of $100 completely undermines the entire idea of EOIs
and absolutely guarantees that the information garnered from the process is
useless. Palage certainly knows this, which begs the question why he makes this
absurd recommendation.

In summary, the Palage comment is, in my opinion, at best biased, erroneous and
non constructive.  This letter is clearly the work of someone who stands to
directly benefit from disrupting or delaying the new TLD process further,
disguised as a well meaning savior of fairness.

Hopefully the folks at ICANN and the Board, Governments, small businesses,
commercial and non-commercial internet users alike all see through the apparent
ruse like I did.

Amanda Taylor
Oxnard, CA

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