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Responding to "The Case for Regulatory Capture of ICANN"

Greg Thomas

A recent investigative report reveals disturbing trend with amending legacy registry agreements

This past Monday, as ICANN65 was beginning in Marrakesh, the technical review blog Review Signal published a detailed expose, "The Case for Regulatory Capture of ICANN” authored by site founder and "geek-in-charge" Kevin Ohashi. The post was clearly the product of extensive investigative reporting — and what it reveals is deeply disturbing.

Ohashi marshals a dizzying and diverse array of facts and figures into a damning indictment of the ICANN organization. This, by itself, isn't exactly news. But his post goes a step further and, by connecting the dots of various data points, he begins to reveal how key constituencies of the Internet governance ecosystem are being influenced by the largest industry players in the Domain Name System (DNS). He accomplishes this in the same way that these things always are: he follows the money.

It bears mentioning that the effectiveness of the post is considerably dampened by expending a considerable amount of proverbial column inches to call out the past employment history with VeriSign of Shane Tews — which ended nearly a decade ago and is ancient history — who is currently founding principal of Logan Circle Strategies and a visiting scholar with the American Enterprise Institute along with various financial disclosures made in accordance with legal requirements by NetChoice's Steve Delbianco and Jonathan Zuck, formerly of ACT. Presenting these past and present affiliations as "gotcha" revelations overlooks the reality that information about them is publicly available for anybody with an Internet connection to view for themselves on LinkedIn or the respective organization's websites. What isn't publicly available but ought to be disclosed here is that these three professionals are first-rate subject matter experts and thought leaders who contribute time, energy, and expertise to DNS policy and Internet governance which would be difficult, if not impossible, to replace and without which would be to the great disadvantage and detriment of the public interest.

It is possible to disagree with someone without questioning their integrity and undue focus on mischaracterizing certain individuals' motives distracts attention away from what should be the primary areas of concern: the hazardous structural defects that are becoming increasingly and insistently apparent in the DNS governance edifice.

The post centers on current negotiations concerning the .ORG registry agreement between its operator, Public Interest Registry, and ICANN. .ORG is one of the original legacy DNS registries that was delegated, along with .COM and .NET, in the original Registry Agreement and is heavily populated with domain name registrations belonging to non-profit organizations. This registry agreement renewal has become somewhat controversial because of an amendment that would remove pricing regulation that has functioned to protect registrants for wanton price increases for nearly two decades.

For many, if not most, matters, ICANN requests public comment on proposed actions and, at any given time, there may be multiple open comment periods for various and sundry ICANN work streams. This would seem to suggest that incorporating stakeholder input is part and parcel of ICANN's normal course of business. But when it comes to matters related to registry agreements, contractual relationships with other contracted parties, or, more broadly, any issue with financial implications, then public comment becomes just that — commentary from the hoi polloi that often serves as a pressure-release valve during times of controversy and, in all cases, provides the facade of participatory governance and bottom up consensus-based policymaking to what would otherwise be seen quite clearly as closed-door dealmaking between ICANN and its contracted parties — or, more bluntly, between the regulator and the regulated.

In order to illustrate this point, the post's author analyzed all of the more than 3300 comments that were submitted during the request for comment period related to the proposed amendments to the .ORG registry agreement. What he discovered was that 3252, or 98.1%, of comments *opposed* allowing PIR an unrestrained ability to raise prices and only six, or 0.02%, of comments were in favor of the proposed change. In what alternate version of reality would an organization with a mission to serve the public interest feel justified to continue to push forward with a proposed action that enjoys virtually no public support while facing such voluminous opposition?

Playing devil's advocate for a moment, the post doesn't really highlight the fact that the reason for such an elevated number of negative comments is because the Internet Commerce Association, a trade group consisting of professional domain investors, made an organized push along the lines of a "Write Your Congressman" grassroots political effort that helped drive increased "turnout." However, the profit-minded motives behind this effort become irrelevant in the face of a supporting coalition of only six individuals that submitted comments in support of pricing flexibility for PIR.

The real issue of burning importance here is the disdain that ICANN displays towards stakeholders by disregarding their input — especially when that input is provided in response to ICANN's solicitation of it in the first place. This isn't an academic concern, nor is it a clerical error happening at the margins of a vast bureaucracy. It is corruption occurring at the heart of a major governance institution and, judging by the absence of organized protest or clarion calls for reform, it has become normalized.

Acquiescence to ICANN's corruption might also explain why stakeholder concerns and recommendations were utterly disregarded during VeriSign's recently approved Registry Services Extension Proposal (RSEP) to release O.COM for auction. The circumstances are strikingly similar — proposed amendments to a registry agreement that weaken or remove longstanding consumer protections and that receive opposition from affected parties during a public comment period that is later summarily disregarded. During that public comment period, ICANN's Intellectual Property and Business constituencies, along with others, recommended that VeriSign's proposed release of O.COM be subject to standard community-developed intellectual property rights protection mechanisms, including Trademark Clearinghouse, Sunrise Period and Priority Access. However, ICANN's Board approved the RSEP in March, at the last ICANN meeting in Kyoto, in a consent agenda vote with no discussion or further consideration pertaining to stakeholder concerns.

One of the most chilling aspects of the O.COM release has been the complete lack of uproar — the deafening silence — that has emanated from the community in response to ICANN's setting aside of critical protections that enjoyed community consensus. An observer could be forgiven for wondering if stakeholders are becoming trapped in a fog of myopic cynicism that causes them to ignore the implications of ICANN's failure to enforce its own policies in the first place and then following that up by sidestepping stakeholder recommendations that explicitly call for their implementation. Perhaps the community should take heed of the caution that, paraphrasing an old poem, "I said nothing when they came for everybody else and so there was nobody left to say anything when they came for me."

When the U.S. Government removed itself from direct oversight of ICANN, the thinking at the time was that the stakeholder community would step up to serve as the counter-balance and accountability backstop to the ICANN organization. There was an involved process of developing new accountability mechanisms that the community could leverage to keep ICANN in check. In reality, there's only one power that the community can avail itself of in the face of a runaway and intransigent ICANN — the power to recall the ICANN Board — which requires a convoluted process that, practically speaking, means it will be used only slightly more frequently than the appearance of Haley's comet.

By all appearances, it hasn't taken long, in the absence of U.S. Government oversight, for rot to set in at the root. If the community is going to acquiesce to its own dismissal — if corruption is to become normalized at ICANN and in DNS governance — then, perhaps it's time to start looking towards the heavens.

By Greg Thomas, Managing Director of The Viking Group LLC – He is the executive director of the Responsible Consumers Alliance, a non-profit organization educating consumers of the Internet's Domain Name Service (DNS). Stay informed at protectdnsconsumers.org Visit Page
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