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Here's How We Can Truly #SaveDotOrg

Many of my friends in the civil-liberties and Internet-law communities have been criticizing the Internet Society's agreement to sell the Public Interest Registry, which administers the .ORG top-level domain. I'm a free-speech guy, so I support their right to raise all these criticisms. But they often ask me directly — knowing that my track record as an Internet civil-libertarian is longer than most — why as a member of the Internet Society (a.k.a. ISOC) board I decided to join the board's unanimous approval of the deal. A key reason is this: I believe this deal is absolutely the best way to ensure that .ORG grows and thrives in the rest of this century.

But this consideration — which I'll explain in a moment — is obscured by the fact that the deal also results in the equivalent of an endowment that could guarantee the Internet Society's long-term economic independence. Still, the reality is that this "endowment" thing, big as it is, wasn't enough to make me vote yes.

True, I started out with the recognition that the sale of the Public Interest Registry (PIR), especially for an endowment-sized sale price, has great potential to improve ISOC's stability and prospects for the future — probably indefinitely. Even our critics acknowledge that the sale would be good for us. The sale gets ISOC out of the domain-name business, which may be helpful since it is unclear whether that business, in its current form, is central to where the Internet is going to be 10 or 20 or 50 years from now. Still, ISOC's charitable mission requires that we think that far ahead — not just in terms of coming years, but in terms of coming decades. It would be weird indeed if the Internet needed to evolve past the current domain-name system, yet ISOC had a monetary interest in sticking with a 1990s model that predates all modern search engines. (It was originally thought that top-level domains, known as TLDs, would be super-important in locating Internet resources. First AltaVista, then Yahoo!, Google, and Bing, altered that assumption.)

But even if the TLD framework will continue to change, and even though it's less necessary than ever when it comes to finding web resources, that doesn't mean it's necessarily static or should be allowed to waste away. Part of the controversy centering on .ORG is that this TLD has grown to have a powerful symbolic value, as well as a powerful branding value. That's why I figured it would be bad stewardship to approve a deal that produces a super-excellent outcome for ISOC at the expense of reducing or eliminating or damaging PIR (and .ORG). It would be better if any deal could guarantee to leave PIR in good shape (or, ideally, in better and improving shape). We helped build PIR into the success it is today — it would be silly to do anything that would undermine or destroy what we've built. Far better instead if we put PIR in a position superior to the one it's in right now, in order for it to thrive and adapt to an evolving Internet landscape.

Still, you may ask, what's wrong with things as they are right now? In a nutshell, it's this — both ISOC and PIR are legally organized as non-profits with specified charitable missions that we both have to follow and that neither can ignore. ISOC's mission, oversimplified, is to protect, promote, and advocate for a healthy Internet — but not necessarily to defend current conventions like the domain-name system. PIR's mission centers on administering, protecting, and securing .ORG ... but also on turning over its profits to fund ISOC. It is no more ISOC's mission to support today's (or, more accurately, yesterday's) TLD system as such than it would have been ISOC's mission years ago to support the bang path email routing that preceded it. At the same time, PIR's mission — as a non-profit project of a non-profit ISOC — isn't to invest in its own adaptation to evolutions of .ORG and related services. Instead, PIR is stuck with maintaining its 1990s-era asset and handing over any surplus (revenue minus costs) at the end of the day to ISOC.

This relationship seemed short-sighted to me. Running PIR as a for-profit enterprise that doesn't have to send most or all of its surplus to ISOC might give PIR the flexibility to reinvest in itself and adapt to a changing marketplace — in fact, it's probably the only credible path for doing that. Plus, there's nothing inherently bad for .ORG in being operated by for-profit companies, if history is any guide — Network Solutions, SAIC, and Verisign did just fine doing that job as for-profit companies. Nor is non-profit status any inherent blessing for .ORG — if anything, the hobbling of PIR by its non-profit status has limited investment in .ORG services. I know the current relationship between ISOC and PIR wasn't ever intended to be any kind of parasitism, but it seems to be functioning that way now. So I found myself more open to a solution that freed both organizations to grow and do better, and not at each other's expense.

But could it be at the public's expense? What about the argument that the prices for domain-name renewals will soar? This argument ignores common sense — you don't take over a successful business and price most of your customers out of the market or spur a mass migration to an alternative product. Not only would that permanently destroy any faith in .ORG — the business you just bought — but it also would undermine TLDs generally. (I've suggested, not entirely jokingly, that the proper response if anybody tries to extort huge renewal fees for .ORG is to launch a mass one-time conversion to the .WTF top-level domain. I'd happily lead any charge in the .WTF Resistance.) In any case, demand for TLDs isn't inelastic, despite what the deal's critics say — there are hundreds of TLDs and customers aren't locked in. It takes only a few minutes of studying PIR's year-by-year financials to see that jacking up domain-name renewal prices in the way the critics fear would be suicidal for PIR or any other registry that depends primarily on predictable renewal rates, and it would destroy the value of .ORG as well. I don't think any of the companies that sought to buy PIR were dumb enough to invest a billion dollars in buying the .ORG business in order to destroy it.

That said, I've also been haunted by my uncertainty as to how long we will have today's domain-name system with us. I'm 63, but it seems possible that even within my lifetime, the TLD system will grow, change unrecognizably, or even fade away entirely. Certain choices by ICANN leading to proliferating TLDs plus the growth of search engines and mobile device apps that don't need TLDs to find things (plus, also, the possibility that Internet-of-Things and other developments may marginalize TLDs altogether) make the future of TLDs hard to predict no matter what we choose today. Most likely, in my view, is that if we have TLDs around in 20 years or 50 years, they may serve different purposes above and beyond the branding purpose they serve for most domain-name holders now. A for-profit PIR has far more capital and far more flexibility to decide what new things can be done to maintain and improve .ORG and make it meaningful and helpful for generations of future Internet users.

That's the future I see that has the greatest potential to #SaveDotOrg — to increase the likelihood that the symbolic value of the TLD we've built adapts and stays strong and has the muscle to resist attempts to co-opt or erode it. Plus, thanks to the network of contracts that binds .ORG to the larger TLD system, it would be challenging for even the most foolhardy investor with a billion dollars to throw away to intentionally buy it up and destroy it.

There are other futures, however, that look less good for .ORG. Some critics propose that ICANN (or someone else) simply kill the deal, freezing .ORG into an already outdated setup and starving the registry that manages it of the ability to adapt and evolve. I have to object to this "austerity" approach — I believe that as an ISOC trustee I can't preside over decisions that lead to the decline of ISOC over time, and that as an ethical person I can't support committing PIR to float off as a non-profit on the possibly melting ice floe of the current domain-name system.

Another alternative future (other critics have embraced) would be for ICANN somehow to extra-legally end its contract with ISOC and hand over management of .ORG to a new consortium with even less capital (and that would deliberately accumulate less) and even less experience in stewardship of .ORG — transitioning .ORG from one parasitical relationship to a worse one, with less money to improve and maintain .ORG. The disadvantages of this second model also seem to me self-evident, but there does seem to be agreement between both models that it's somehow better for PIR to be less profitable and less able to invest in itself. Because we live in an evolving, challenging world rather than a static and predictable one, and because I am 100-percent dedicated to #SaveDotOrg, and — most important — because I want to maximize the chances that .ORG serves Internet registrants and users 100 years from now, I am compelled to respectfully disagree. I prefer that we #SaveDotOrg not as something that we've gotten used to, but instead as something that our children and grandchildren may find useful.

By Mike Godwin, Member Board Of Trustees at Internet Society – Mike Godwin is currently serving as a member of the Internet Society Board of Trustees and as a Distinguished Senior Fellow at R Street Institute. He was the founding staff counsel of the Electronic Frontier Foundation and served from 2007 to 2010 as general counsel for the Wikimedia Foundation. Godwin is a former board member of the Student Press Law Center and the Open Source Initiative. Visit Page

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Comments

The .ORG "Deal" By John Poole  –  Jan 15, 2020 1:00 pm PDT

Mike, how do you reconcile your .ORG "deal" with the following:

"The policy for the operation of the .org registry required inter alia that (i) the registry be “operated for the benefit of the worldwide community of organizations, groups, and individuals engaged in noncommercial communication via the Internet”, (ii) responsibility for the .org administration be “delegated to a non-profit organization that has widespread support from and acts on behalf of that community”, and (iii) registry fee charged to accredited registrars be “as low as feasible consistent with the maintenance of good quality service”. The DNSO’s policy on the reassignment and administration of the .ORG registry has never been amended nor revoked." — Namecheap reconsideration p. 9 citing ICANN, Report of the Dot Org Task Force Adopted by the DNSO Names Council 17 January 2002 and accepted as guidance by the ICANN Board on 14 March 2002.

Reconciling the .ORG deal with the Namecheap reconsideration By Mike Godwin  –  Jan 22, 2020 9:08 am PDT

John, you ask me to "reconcile" the deal with the language you quote (although it seems to me that you're missing a quotation mark). Let me walk you through your enumerated considerations:

(i) As I noted in my piece, nothing about a commercial entity's operating PIR or .ORG entails that the registry can't be, or isn't, "operated for the benefit of the worldwide community of organizations, groups, and individuals engaged in noncommercial communication via the Internet." Just as a commercial bank (or a commercial grocery) can provide services that benefit noncommercial entities, so can a registry. In addition, the .ORG TLD is also licensed to individuals and entities that are not noncommercial, as you know.

(ii) Responsibility was, in fact, delegated to a non-profit organization that acts on behalf of the community in 2003, consistent with the guidance of the DNSO Names Council's advice to ICANN in 2002. I think what you are trying to say is that this guidance adds up to a binding contractual commitment, but I don't think it is one. It was DNSO's best guess in 2002 about what ICANN should do back then, and it was "guidance," not law or contract itself.

(iii) I believe the fees should, in fact, be "as low as feasible consistent with the maintenance of good quality service”“as low as feasible consistent with the maintenance of good quality service,” and that both PIR, its owners, and, if it wishes, ICANN, will do so. Any other choice would damage the value of the assets represented by .ORG and PIR.

I'm not sure what point you're trying to make when you say DNSO's guidance has "never been amended or revoked." As I've said, that was guidance in 2002, and ICANN adopted it then, but it doesn't seem to be law or regulation in itself. As I suggest in my article, the domain-name market has changed quite a bit since then, not least because of ICANN's decisions regarding the domain-name space generally.

My argument--as I'm about to explain to another critic--is not that PIR or some successor in interest *can't* raise renewal fees in an extortionate way. Obviously, the removal of price caps through the contract with ICANN means it's theoretically possible to do that. But it would be foolhardy by investors to do that, because it would ultimately lead both to loss of faith in the value of .ORG and some significant migration to alternative TLDs that are less stupid about price hikes. It would be the equivalent of throwing their investment, or some big chunk of it, away, because the value of PIR as a property is reliable, predictable renewal rates.

But could it be at the public's By Kevin Ohashi  –  Jan 21, 2020 3:31 am PDT

But could it be at the public's expense? What about the argument that the prices for domain-name renewals will soar? This argument ignores common sense — you don't take over a successful business and price most of your customers out of the market or spur a mass migration to an alternative product. Not only would that permanently destroy any faith in .ORG — the business you just bought — but it also would undermine TLDs generally. (I've suggested, not entirely jokingly, that the proper response if anybody tries to extort huge renewal fees for .ORG is to launch a mass one-time conversion to the .WTF top-level domain. I'd happily lead any charge in the .WTF Resistance.) In any case, demand for TLDs isn't inelastic, despite what the deal's critics say — there are hundreds of TLDs and customers aren't locked in.

It's embarrassing how out of touch you are with reality. Or perhaps you're willfully ignoring the truth that there absolutely is a lock in effect with domain names. Organizations spend fortunes branding their domain names into minds and on physical things. Not to mention links and search engine rankings. These things simply don't transfer if you have to move TLDs. You want to maintain decades of links that keep your non profit on top of Google? You can't simply move to a .WTF tld.

The only joke here is how you're helping lead the propaganda campaign that selling .ORG to private equity and abdicating ISOC's responsibility to the .ORG users and the internet community as a whole. Trying to sell it to the rest of us like we're idiots.

It's evident ISOC is your only priority and you have no allegiance to the wider community you pretend to be representing. .ORG is a money printing machine that ISOC was gifted, it existed before ISOC, the fact you think it's yours to sell is disgusting. Saying a new non profit owner for PIR would have less ability to manage it is misleading at best. It would have an income stream from .ORG which is what funded ISOC for tens of millions of dollars in profit.

Let's be perfectly clear, your only interest is a billion dollars for ISOC. That's why you and Vint are so alone in defending this deal. There is no broad community defense of this. Even ISOC chapters came out against it. You're on the wrong side of internet history here and you're actively trying to make .ORG worse for your grandkids and their grandkids.

I've never been embarrassed by someone whose primary criticism is invented ad hominem attacks. By Mike Godwin  –  Jan 22, 2020 9:32 am PDT

Hi, Kevin.

My experience has been that people who begin their disagreement with presumptions about my motivations or character do so because they are unable to argue on the basis of logic or evidence, but let me do you the favor of considering that you may think your ad hominem arguments are substantive.

You write: "It's embarrassing how out of touch you are with reality." Maybe. But I'm sufficiently in touch with reality that I try not to generalize about the character of people whom I don't know in reality. In that respect, it seems possible I'm more in touch with reality than you are.

You write: "Or perhaps you're willfully ignoring the truth that there absolutely is a lock in effect with domain names." I don't think I'm "willfully ignoring" a "truth" here. Let's look at your analysis: "Organizations spend fortunes branding their domain names into minds and on physical things." Organizations that spend fortunes on, well, anything are organizations that are well-positioned to migrate to a new TLD if .ORG is maladministered. That's what being able to "spend fortunes" enables organizations to do.  You write: "You want to maintain decades of links that keep your non profit on top of Google? You can't simply move to a .WTF tld." First of all, Google does not rely primarily on TLDs for indexing. Second, the Internet Archive and other resources enable your web links to survive as resources while you make a transition (and Wikipedia and other services use the Internet Archive to fix broken links). Third, your scenario assumes that that the extortionate price hikes are going to happen, but as I outline in my response to John, above, it would be self-destructive of any owner of PIR or administrator of .ORG to do that. Fourth, after making a public commitment, as Ethos Capital and PIR have independently done, to constrain price hikes in renewals to longstanding predictable levels, any departure from that public commitment invites regulatory and/or legislative responses that would be punishing to the principals--not just in the United States but elsewhere in the world where complaining registrants might have jurisdiction. This is a claim that it helps to consult practicing commercial lawyers about when you reality-check it.

You write: "The only joke here is how you're helping lead the propaganda campaign that selling .ORG to private equity and abdicating ISOC's responsibility to the .ORG users and the internet community as a whole." I don't believe my expression of my thinking on this question amounts to propaganda, since it is a sincere and honest statement of my reasoning with regard to the decision.  I go into my thinking in more detail here at this Techdirt podcast, which I arranged with Techdirt because I thought it was important that people hear me getting asked the hardest possible questions about what I was thinking, and defending my reasoning about my decision. In general, propagandists don't subject themselves to cross-examination.

You write: 'It's evident ISOC is your only priority and you have no allegiance to the wider community you pretend to be representing.' I see you aren't familiar with my work. That's fine, but if you did a little more research you might discover that your declarations about my allegiance are unfounded.

You write: 'Saying a new non profit owner for PIR would have less ability to manage it is misleading at best. It would have an income stream from .ORG which is what funded ISOC for tens of millions of dollars in profit.' First of all, you don't seem to have interrogated the proposal I'm criticizing, which expressly says it would give away that income stream, or some part of it. Second--and this is where you seem a bit unbalanced to me--when you talk about the income stream that "funded ISOC for tens of millions of dollars in profit," you actually are describing a motivation for ISOC *not* to approve the deal. It is, in my view, a no-brainer that it would have been uncontroversial for ISOC to continue leeching surplus income from PIR indefinitely. You likely wouldn't have been triggered at all if we'd done that. But stewardship of ISOC, of PIR, and of .ORG required that we risk controversy in order to make a more forward-looking set of decisions. I'm happy to stand with Vint Cerf on that.

You write: "You're on the wrong side of internet history here and you're actively trying to make .ORG worse for your grandkids and their grandkids." It's always possible that any human being with human limitations is on the wrong side of history, and this of course includes you as well as me. But no one familiar with me or my work believes I am "actively trying to make .ORG worse" for my descendants or yours or anyone's. I want to save .ORG long past my lifetime, and this seems to me to best choice to financially support saving .ORG.

Oops. Forgot the link to the Techdirt podcast. By Mike Godwin  –  Jan 22, 2020 9:35 am PDT

It's here:

https://www.techdirt.com/articles/20200115/11301343739/techdirt-podcast-episode-234-mike-godwin-defends-selling-org.shtml

Mike

One more brief addition By Mike Godwin  –  Jan 22, 2020 9:40 am PDT

I think there is a presumption that I personally profit in some way from the .ORG sale. To make this point absolutely clear, I don't get a dime from the deal, and I'm not an investor in any enterprise associated with the sale.

"Google will find the resource I am By Kevin Ohashi  –  Jan 22, 2020 11:38 am PDT

"Google will find the resource I am looking for whether I add .ORG to it or not"

Host interjects that this isn't the case and is a problem. Mentions broken links. Explains how it's not the same as buying milk.

Instead of addressing his concern you resort to saying economic reasons prevent them from raising prices unreasonably. Nobody would ever destroy this careful resource. He even calls you out at the end for not answering his question, you do a good job dodging and changing the topic.

You're willing to risk .ORG for your organizations profit because you can't imagine it happening. Just like people couldn't imagine private equity buying .ORG when the price caps were removed.

You even admit there are bad PE actors. But TLDs are just a series of bits you say and make nonsensical analogies. Host says PE may just try to extract the value from .ORG.

You say it hits the speculators first and seem to think that's good. Then offer to lead your .WTF migration again. It's a funny line, but it is a non solution. Disappointing to say the least.

Your only defense is that it wouldn't be in Ethos' best interest to extract as much as possible.

Your argument is that these public commitments are meaningful. When Donuts, the registry which has ties to both PIR and Ethos' management went back on their promise about pricing in the past. But trust you, these guys mean it… this time?

Ultimately, after an hour you couldn't even convince the host, which he explicitly wrote in the comments afterwards.

That's an hour I won't get back listening to you re-hash the same arguments, showing you don't actually understand how domain names and search engines work and aren't really considering the impact of the sale on registrants of .ORG.

You seem to be addicted to ad hominem attacks. By Mike Godwin  –  Jan 22, 2020 12:04 pm PDT

I'll try to extract some substance from your bile.

(1) You write: "Host interjects that this isn't the case and is a problem." That's not quite what he said, and it unquestionably is the case that search engines find the resources I'm linking to whether I add a TLD to the search terms or not. Indexing is constantly updated by the search engines, as most people who've studied them know.

(2) You write: "You're willing to risk .ORG for your organizations profit because you can't imagine it happening. "I can imagine it happening, just as I can imagine Lex Luthor sinking the California coastline. But it's not likely to happen.

(3) You write: "Disappointing to say the least." I'm invariably disappointing to the guys whose primary analytical approach is ad hominem. I'm not sure what the point would be in validating your approach, given that it's a logical fallacy.

(4) You write: "Your only defense is that it wouldn't be in Ethos' best interest to extract as much as possible." That's not my only defense, and in fact you list another defense later in your posting. So I'd say you refuted your claim here without my help.

(5) You write: "Your argument is that these public commitments are meaningful." Yes, based on my practice of law and knowledge about how regulatory agencies and Congress works. It is commonly thought by laymen that a commitment not backed by a contract term isn't binding. After your first year of law school, normally, you're over this misapprehension.

(7) You write: "Ultimately, after an hour you couldn't even convince the host, which he explicitly wrote in the comments afterwards." My purpose in the podcast was not to "persuade the host" but to give a strong critic of the deal a chance to cross-examine me in public about my reasoning. I notice that you--for whatever reason--elided Mike's more generous comments regarding my participation, both on the show itself in the comments section. That's fine--when ad hominem is your only tactic and only strategy, it's difficult to make yourself be factually accurate.

(8) You write: "That's an hour I won't get back listening to you re-hash the same arguments." Not technically a rehash since I was developing my CircleID article based on arguments I planned to present on the podcast. (We scheduled it several days in advance, and I suggested it to him first back in December.)

(9) Just a reminder that I'm not paid to have the opinions I have regarding the .ORG sale, and I don't stand to make any money from having them, and that I'm not an investor in any stakeholder in any part of the deal. As a trustee of the Internet Society, I am wholly uncompensated in any way.

Mike

(1) You write: "Instead of addressing his concern you resort to saying economic reasons prevent them from raising prices unreasonably." This wasn't an "instead of" argument. It was the fundamental argument. The threat model you articulate is based on speculation, not actual evidence actually deriving from this actual transaction.

You really don't get it. Do you By Kevin Ohashi  –  Jan 22, 2020 1:07 pm PDT

You really don't get it. Do you know how search engines rank content? https://moz.com/search-ranking-factors literally the top influencing factor is related to the domain. If someone had to give up their domain they lose the most influential part of search engine rankings. You say my primary argument is ad hominem but ignore actual logic and evidence. If you want to play stupid, you're welcome to continue. Anyone who has invested in a domain of any tld has a lock-in and associated switching cost which can be substantial. Losing your rankings in search is a big deal. Losing old email addresses. Needing to rebrand everything. Switching costs are very high and thus demand is inelastic. It's fundamental economics.

Your inability to see a future unbiased by your vested interests continues to be disappointing. You seem to have no problem resorting to ad hominem calling me unbalanced, so certainly there is no moral high ground. My criticism of you stems from your compromised position as a board member of the organization trying to make over a billion dollars. It's a legitimate criticism, you're unable to argue in good faith because of your role. It's telling that there isn't a lot of support, only two people connected to the profiting organization making statements trying to defend this deal. You personally may not be compensated but you believe in isoc enough to sell out all the other non profits and support the idea that a private equity firm should be able to levy an internet tax at will essentially unregulated (because you couldn't put anything into a contract, because… It's hard?).

Since you're responding,

what would it take for isoc to back out of this deal? What is a dealbreaker for isoc to turn down the money and walk away?

Do you accept 10% per year price increases are factually not historically accurate for .org? The whole premise of keeping price increases in check is already at a level triple historical norns.

Responses By Mike Godwin  –  Jan 22, 2020 2:01 pm PDT

You write: "Do you know how search engines rank content?"

Yes.

You write: "literally the top influencing factor is related to the domain"

This statement doesn't support your claim. In addition, there's this at your link: 'Note that these factors are not "proof" of what search engines use to rank websites, but simply show the characteristics of web pages that tend to rank higher.'

'Your inability to see a future unbiased by your vested interests continues to be disappointing.'

I'm not sure what "vested interests" you're referring to. (Do you know what "vested interest" are?)

You write: 'You personally may not be compensated but you believe in isoc enough to sell out all the other non profits and support the idea that a private equity firm should be able to levy an internet tax at will essentially unregulated (because you couldn't put anything into a contract, because… It's hard?).'

I haven't "sold out" any nonprofits. If you're trying to say that ISOC should have conditioned the sale on a contract term about pricing and price caps, you don't understand the contract-law reason why ISOC can't impose rights it does not have.

You write: 'what would it take for isoc to back out of this deal? What is a dealbreaker for isoc to turn down the money and walk away?'

It's not possible for ISOC to "back out of this deal." The question is not one of turning down the money--it's one of affirmatively causing a contract breach.

I know a lot of this contract-law stuff is new to you, but you needn't take my word for it. Talk to other lawyers who've handled commercial contracts.

'Do you accept 10% per year price increases are factually not historically accurate for .org?'

It has been a cap, not a trend.

You write: 'My criticism of you stems from your compromised position as a board member of the organization trying to make over a billion dollars.' I don't feel "compromised," since I reached my decisions based on principles that I've articulated in my article and elsewhere, and on my reason and experience as someone who has worked in nonprofits and internet policy for 30 years.

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So you're literally incapable of acknowledging facts. By Kevin Ohashi  –  Jan 22, 2020 8:20 pm PDT

So you're literally incapable of acknowledging facts. The page rank algorithm Google was built on is about recognizing how many links point to a domain and how more of them give more value. Losing those links (eg. Changing your domain name) causes a company to lose that ranking factor. Your arguing this isn't true because if it were, it would mean there is a high switching cost to losing your domain.

As for price increases. You can't acknowledge simple fact that .org has had 7 price increases in 16 years and it's on average been 3.5%? You paste lines about org being affordable and it's only a dollar. Ignoring the reality of compounded interest and how 10% per annum is historically wildly out of line.

We aren't debating opinions Mike. Once you've given up acknowledging reality, you're a bad actor in the discussion.

You're defending a deal by (hopefully?) Pretending to be ignorant of simple facts. Thanks for selling out the non profits for your own organization's gain. Mike Godwin's sale price, 1.135 billion dollars. At least we know what integrity costs.

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Kevin Ohashi's character failures By Mike Godwin  –  Feb 14, 2020 4:39 pm PDT

Of course I'm referring to the fact that Kevin, no matter how many hints I drop, can't stop attacking my character. I'll just pass over some of the nonsense to reply as appropriate in ways that add knowledge:

He writes: 'So you're literally incapable of acknowledging facts. The page rank algorithm Google was built on is about recognizing how many links point to a domain and how more of them give more value. Losing those links (eg. Changing your domain name) causes a company to lose that ranking factor. Your arguing this isn't true because if it were, it would mean there is a high switching cost to losing your domain.'

The whole thrust of this argument is that someone will be losing a domain name, but the reality is that nothing about the sale of PIR requires that anyone lose their domain name. Daisy-chaining nightmare scenarios is a lovely hobby, but it's not "facts."

"We aren't debating opinions Mike. Once you've given up acknowledging reality, you're a bad actor in the discussion."

I think the "bad actor" in a discussion is the speaker whose only tactic is to attack the character and motives of someone with whom he disagrees. That's you, Kevin, as your postings make eminently clear.

'Thanks for selling out the non profits for your own organization's gain. Mike Godwin's sale price, 1.135 billion dollars. At least we know what integrity costs.'

I haven't received a single dime for anything I've said or written as an ISOC trustee, or for anything I've said in defense of the deal. ISOC trustees are unpaid volunteers.

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So your only defense of the sale By Kevin Ohashi  –  Jan 22, 2020 10:28 am PDT

So your only defense of the sale is that 'market forces' will correct bad behavior. That organizations should be expected to spend fortunes, if necessary, to move elsewhere because they can. A long stable resource pre-dating ISOC and PIR which gets sold to private equity to profit maximize instead of serve the community is OK because 'market forces' will correct it. Ethos can reap the profits in the meantime.

Let's go point by point

"First of all, Google does not rely primarily on TLDs for indexing."

You obviously miss the point and are likely being willfully ignorant of how a website's rank on search engine works. Anyone who has ever migrated to a new domain knows they have to redirect the original to maintain search engine rankings and old links to your content from other sites. This has nothing to do with Google debating what TLDs to index, it's about what domains are already indexed and why changing domain names hurts rankings.

"Second, the Internet Archive and other resources enable your web links to survive as resources while you make a transition (and Wikipedia and other services use the Internet Archive to fix broken links)."

Completely irrelevant to the issue.

"Third, your scenario assumes that that the extortionate price hikes are going to happen, but as I outline in my response to John, above, it would be self-destructive of any owner of PIR or administrator of .ORG to do that."

They are already committing to price hikes of around 10% per year which is well above the historic increases of .ORG which since 2003 has had 7 price hikes with an average of around 7%. So we're talking historically the level is around 3.5% year roughly. So that commitment is triple the historical levels already. Has that hurt .ORG registrations? No. Demand for .ORGs isn't elastic as you seem to think. .ORG is able to extort owners because switching costs are very high for web addresses. And before you go down the road of, it's only a few dollars. It's a few dollars multiplied by millions of registrants. That would just be advocating the penny stealing scheme from office space.

Furthermore, speaking of price hikes. Who is in charge of PIR and who is running Ethos? It's the old Donuts crew. Who said they had no plans to increase prices on new gTLDs. https://onlinedomain.com/2019/04/03/domain-name-news/so-donuts-lied-and-is-now-increasing-renewals-to-220-domain-extensions/ Except then they did. So pardon me for not trusting magical market forces and your uninformed belief that demand for .ORG domain names is elastic. You want to deal with logic and evidence. Here it is.

"Fourth, after making a public commitment, as Ethos Capital and PIR have independently done, to constrain price hikes in renewals to longstanding predictable levels, any departure from that public commitment invites regulatory and/or legislative responses that would be punishing to the principals--not just in the United States but elsewhere in the world where complaining registrants might have jurisdiction. This is a claim that it helps to consult practicing commercial lawyers about when you reality-check it."

Where is that in an enforceable contract? Sorry that a meaningless public commitment doesn't hold water from a company that solely exists to make profit from .ORG.

Just because you may have done something in the past doesn't mean what you're doing here now is right. You've shown yourself to be uninformed about the real costs of switching domain names and how important a role they play for an organization. You don't seem to grasp the economic consequences for all the .ORGs you are selling out. I can quite comfortably say your allegiance is to ISOC and not to the greater community on this issue.

Mike, you might have done a lot of good in the past but you're wrong here and you're on the wrong side. Maybe actively making .ORG worse is wrong, you're trying to secure ISOC at the expense of .ORG. If selling out .ORG to private equity after removing the price caps on it is the best way you can see to save .ORG past your lifetime, perhaps you need to step down. Selling out .ORG to private equity to fund your organization in a questionable backroom deal isn't about securing .ORG's future, it's about securing ISOC's future.  Don't confuse the two and stop using one to justify the other.

I think you're confused about several aspects of what I've argued. By Mike Godwin  –  Jan 22, 2020 12:34 pm PDT

Hi, Kevin.

You write: 'So your only defense of the sale is that 'market forces' will correct bad behavior.' No, that's not my only defense. I also allude to public commitments regarding .ORG that, if broken, would almost certainly trigger government intervention. In addition, I should mention that your uninterrogated assumption is that the only way PIR is worth investing in is if they hike prices. As a technical matter, that's not true. The value proposition for acquisition of PIR is predictable, reliable year-over-year income based on renewals.

You write: "You obviously miss the point and are likely being willfully ignorant of how a website's rank on search engine works. " I don't think I'm ignorant, "willfully" or otherwise. Certainly I've consulted with Google employees about how Google search works, and I'm aware of the cost of transition. But you're focusing on the cost of transition as a way of dodging my primary argument which is that the need to transition to a new TLD is highly unlikely, because that would only arise if PIR started to raise prices in way that's inconsistent with the whole point of the investment.

You write: "Where is that in an enforceable contract? Sorry that a meaningless public commitment doesn't hold water from a company that solely exists to make profit from .ORG." It's possible that your law practice and experience dealing with regulators is vastly different from mine and superior to mine. But until you buttress statements like this with evidence deriving from the particular facts, I'm going to have to side with my own reasoning and experience on this one.

You write: "Who is in charge of PIR and who is running Ethos? It's the old Donuts crew. Who said they had no plans to increase prices on new gTLDs." We didn't sell .ORG to Donuts, and Donuts didn't raise prices on .ORG. I understand that you have decided that Ethos will do with .ORG what Donuts did with some of their TLDs. But my view is that you've underscored the importance of Ethos's public commitment--with the eyes of regulators and legislators on them--not to do so with .ORG (that is, to keep price increases within the boundaries of the pre-existing price-increase caps). Maybe in your personal encounters with Congress and regulators you've found it easy to break your public promises, but that's not the norm.

You write: "Just because you may have done something in the past doesn't mean what you're doing here now is right." Of course it doesn't, and all careful readers will already have noted that I don't make any such argument.

You write: "You've shown yourself to be uninformed about the real costs of switching domain names and how important a role they play for an organization." Actually, I'm informed about them, and I know why .ORG is valuable to NGOs. I've given 30 years of my life to working for NGOs, both in policy and in general counsel roles, and there's no aspect of operating NGOs that I'm unfamiliar with, including costs. But, more importantly, you keep focusing on the cost of transition so as to avoid the argument that the transition to new TLD is unlikely to happen in the absence of a commitment-breaking renewal-price increase. And you keep asserting that the commitment-breaking massive renewal-price increase is going to happen. That's where your claims are entirely speculative, based in part, I think, on lack of awareness that companies may be bound by regulators' and legislators' expectations even in the absence of an express contractual term. (I'll note that PIR *already* has no price caps on renewal, and that has been true since before I joined the ISOC board last summer. ) Just for reference, the FTC generally has jurisdiction over commercial enterprises that, broadly speaking, engage in unfair and/or deceptive trade practices. The absence of a contractual term limiting cost increase becomes irrelevant when you recognize that breaking a promise to adhere to price caps after promising voluntary adherence to a cap is the kind of thing that gets FTC lawyers excited.

You write: "Maybe actively making .ORG worse is wrong, you're trying to secure ISOC at the expense of .ORG." As I expressly have written, if securing ISOC's future had to be done at the expense of PIR and .ORG, I'd have voted against the deal. That's still true.

You write: "If selling out .ORG to private equity after removing the price caps on it is the best way you can see to save .ORG past your lifetime, perhaps you need to step down." I hope it will be understood that my beliefs on this derive both from principle and from my drilling down into the facts and economics of very many aspects of this deal, including possible risks and consequences to stakeholders who are not themselves party to the deal. I'm sorry you can't see how someone might have a principled set of opinions different from yours, but I've never been someone who picked his opinions in order to win popularity contests, and I have no plans to cut my conscience to fit this year's fashions. I'm only human, and not immune to error, but my belief is that I've given more thought than my critics on this issue have done to how .ORG will survive and thrive fifty years from now. To #SaveDotOrg at the price of nailing it to the cross of a 1990s understanding of domain names seems breathtakingly shortsighted to me.

Ethos is already saying 10% per year By Kevin Ohashi  –  Jan 22, 2020 1:31 pm PDT

Ethos is already saying 10% per year and you're trying to argue price hikes aren't necessarily happening? This is simply delusional argument.

Your argument is only crazy price hikes would drive people away and you will lead the charge to lala land. You are perfectly comfortable accepting a low level tax individually scaled to millions of organizations who are locked in because they are locked in because of high switching costs. As long as switching costs are below price increases they stay. Or more accurately as long as the attrition rate is below increased revenue it is ok. It doesn't matter that you're ok taking money away from the organizations trying to do good in the world. What's a few bucks taken from people trying to improve the human condition. They can afford a few bucks. Or go some other told. Maybe .WTF because that is the reason she to this whole ethos deal.

You wanted an example of backing out of public commitments, I gave you one from donuts, a company PIR's CEO and ethos CEO are connected to. They backed out of a public commitment. Apparently an example involving the same people in the same industry isn't good enough for you. It's all ad hominem from me, right?

Assuming you were an icann board member and had to delegate .org today, what kind of organization would you award it to and why? If that answer isn't ethos capital, how do you justify selling it to them except for the 1 billion obvious reasons?

Your recitations of what you think the facts have become increasingly unmoored. By Mike Godwin  –  Jan 22, 2020 2:05 pm PDT

If you want to see the rationale for Ethos's investment in buying PIR, it's here:

http://www.circleid.com/posts/20200122_thoughts_on_our_npr_interview_about_dot_org_acquisition/

Specifically. there's this:

'Investment Thesis
'During our discussion on NPR (and many others), we have heard questions such as, "Why did Ethos pay so much for PIR?" and "What's in it for your investors?" I understand that this is where a lot of the fear about price increases comes from — at the heart of this, people are wondering why we would invest over $1 billion in PIR if we don't plan to profit by raising prices? As Erik Brooks, the Founder and CEO of Ethos, has stated previously, our investment thesis in buying PIR was very much driven by the stability and predictability of the company's current and historical performance. Like any business with stable revenues over time, the investment amount is one we're very comfortable with based on the current profitability of the business. When we first heard concerns on price constraints, it was easy to address them because we never had any plans for dramatic price increases.
'Price Restrictions
'Andrew made it clear that the removal of the price restrictions was not connected to the decision to sell PIR. As Andrew stated, various parties had expressed interest in acquiring PIR from the Internet Society before the price restrictions were removed. We have addressed these concerns directly: Ethos has committed to limiting any potential increase in the price of a .ORG domain registration to no more than 10% per year on average, even though today there are no regulatory pricing constraints on PIR or virtually any other domain name registry. At less than $10 today, .ORG is one of the most affordable domains in the world, and a 10% increase would equate to about $1. As such, .ORG will continue to be one of the most affordable domain names to use. As noted, without the transaction, PIR today could raise prices as much as it wished.'

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