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ICANN (TBD): Why is ICANN Always to Blame and What to Do About It

Constantine Roussos

With great anticipation I waited for the most recent Applicant Guidebook version 4 aka DAG4. I was looking forward to seeing gTLD program timeline [PDF]. Was it possible that ICANN would give us another timeline and be firm with it? And then I saw it. Those 3 letters next to the new October 2010 launch date: tbd. So the date is October 2010 but it is "To Be Determined"? On one hand we have a set date but on the other hand it is yet to be determined.

What would I do with the gTLD program timeline?

If I were the Board of ICANN and the CEO, I would demand too keep the timeline from the gTLD team and remove the "tbd" tag for the obvious reasons. If there is no firm deadline or commitment, then people tend to slack off, leave things for the last minute, and take their time with everything. How many people are working on the gTLD program at ICANN? I would add all their salaries up, their bonuses and miscellaneous compensations and then ask if the results are satisfactory in regards to their performance. I would ask whether all the issues have been addressed in a satisfactory manner and if not, why haven't they? Not all of ICANN failed with timelines. The Fast Track IDN program that is run by significantly far less staff had a proposed timeline and it was met. Does this mean we are having diminishing returns in the gTLD program because there are too many people working on it? Or was it all about special interest, government influence and politics to push IDNs? I think it is a combination of both and the fact that the gTLD program lacks strong leadership skills to manage conflict resolution effectively and in a timely manner.

What would I do with gTLDs categories?

I believe ICANN took the wrong approach with new gTLDs. If scaling and stability is of great concern, why did ICANN introduce .brand gTLDs? Those are not priorities for the Internet since brands, with deep enough pockets to afford a brand name gTLD, already own their .com, .net, .org etc. The chances are only Fortune 1000 companies will opt-in for brand gTLDs.

The second type of gTLDs which I do not see as a priority are the money-grabbing, "over-generic and confusingly similar" gTLDs like .web, .site, .internet, .online, .website etc. Those pose the biggest risk to trademark holders as well. eg. Microsoft.web vs Microsoft.sport. Microsoft as far as I know does not hold any trademarks in sports, so a .sport extension would not hurt Microsoft in any way or confuse users. No cybersquatter would register Microsoft.sport because it has no value to them and it would have zero direct navigation traffic or typosquatting implications.

What would I do with Registry/Registrar Vertical Integration?

This is by far one of the most out of touch concepts at ICANN. The only parties that feel threatened are the big registries (e.g. VeriSign, Afilias) and big Registrars (e.g. GoDaddy). What I find fascinating is that neither group wants integration. Additionally, I find it fascinating that some members of the ICANN Board has 2 representatives from Registrars (Google, MelbourneIT) and one representative from a registry (Afilias). This is an obvious conflict of interest and worrisome because no-one knows what is discussed behind closed doors despite some abstaining to vote. Even if they abstain from voting, the influence is still there. If ICANN wants new entrants to compete, they should allow the possibility of vertical integration and service bundling.

Was anyone hurt with GoDaddy or BRS Media business practices with .me and .fm respectively? Not at all. The excuse is and will remain: those are country codes. And so is .tv and .co right? Last time I checked their marketing, all of them were treated as generic TLDs: .me stood for personal websites, .fm for radio, .tv for television and .co for company. There will be so many options with new gTLDs that consumers will win out and pricing will not be a factor, especially with bundled value-added services. ICANN consulted economists who agreed with the benefits of integration.

Let us say vertical separation remains. It does not seem to bother many people. Some applicants love this because it means they will get no competition from current registries and registrars who might want to apply for a new gTLD. But perhaps there will be loopholes to circumvent this. And there lies the problem with this "rule" which no-one talks about.

I disagree with the concept of vertical separation. If you wanted to do it right you could implement all or some of the following:

  1. Disallow current market leaders to apply for new gTLDs (VeriSign, Afilias, GoDaddy) to spur competition and innovation in the domain space.
  2. Allow new entrants to be vertically-integrated if they choose so
  3. Allow only community gTLDs to be vertically integrated so they can better serve their constituents

What would I do with finances, budgets and hiring?

While it is not a secret that some of the salaries of ICANN top executives are high, I do not believe this is of great concern. If an organization wants the best talent, then they have to pay up to get them on board. The problem though is that a lot of money is given in "bonuses." Are bonuses aligned with strategic goals and timeline commitments? Are those goals met? A better tracking and transparent measurement system needs to be put together in regards to bonuses at ICANN.

With great interest I looked at the ICANN 2008 tax statement and some numbers on page 41 did not make sense to me. For example, why was Paul Levins paid a base salary of $204,500, a bonus of $80,191 and "other compensation" of $90,349? There might be an explanation for the salary breakdowns but some stood out to me since they seemed inconsistent when compared with others.

One issue that can also be of concern is travel expenses. Those can add up significantly, especially if traveling in first class or business class only. Incentives should be given to staff that choose to fly economy that ultimately would save ICANN money.

Another area which can stretch the budget is hiring staff in areas where there is no immediate need or overhiring staff in positions that can be handled more effectively by less people. For example, the VP of Marketing position at ICANN is unnecessary in my opinion. There is no immediate need for ICANN to have a specialist in marketing at this moment. Registries and registrars are responsible for the marketing of gTLDs, ccTLDs and IDNs. Another position which I found interesting is the VP of Information Security. Doesn't ICANN have enough security advisers as it stands e.g. Security and Stability Advisory Committee?

If ICANN is indeed under budget constraints, why would the Board approve a yearly expenditure of $400,000+ for up to 10 years for 5000 square feet of office space in Palo Alto for current ICANN CEO Rod Beckstrom? It was always my belief that the CEO of the company should have been required to work at the Marina Del Rey head office. I believe Paul Twomey had his own office in Australia when he was CEO too, so this must be standard procedure for ICANN CEOs. However, if Rod works more effectively in Palo Alto and ICANN and the Internet community benefits, then kudos to the move. Only time will tell and I am giving Rod and the Board the benefit of the doubt for this move.

As a newly-appointed CEO, Rod Beckstrom does appear to be given credit in areas where he did not contribute to a significant degree. I still would like to see him take a stronger leadership (or may I say Starfish) approach to ICANN in regards to making better decisions in the public interest and consumers, not governments or special interest groups. His book recognizes that the Internet world has changed. Society has changed how it relates to technology. The days of working in a status quo, static world, where the future was expected to be just like the past is over. As others have indicated: the new DAG is nothing but a zero-risk application written by attorneys designed to prevent innovation. It is Rod Beckstrom's duty to make his personal mark and pursue the goal of a better, more innovative Internet that is synonymous with the current times. I have faith that he will rise up to the occasion.

I am saddened that COO Doug Brent is leaving ICANN. It will be very difficult for ICANN to find someone, especially an outsider to ICANN, to replace Doug in such an important position. He is without a doubt the anchor of ICANN and one of the most competent executives. I would have done whatever I could to keep him on board given what is at stake at ICANN in the next year or so.

What would I do with the bottom-up approach?

One thing that was apparent to me in DAG4 was the propensity for ICANN to succumb to influential groups and listen to one group over another. An example is the trademark provisions that were incorporated to protect trademark holders: Uniform Rapid Suspension System, a Trademark Clearinghouse and the Post-Delegation Dispute Resolution Proposal. Trademark protection is significant, but it seems that ICANN gets no respect from the trademark community for their efforts to accommodate them. In the most recent INTA meeting in Boston, Kristina Rosette of Covington & Burley attorney group, suggested litigation to further slow down the gTLD process. My question is why does ICANN continue to cater to attorney needs and their propensity to say and do anything to slow the process so that they ultimately get paid more?

Some issues that are critical were ignored, the biggest one being a better definition of what a community is to meet realistic standards. Would .cat qualify as a community application under DAG4? Probably not. Why is this so difficult to put in words? I made some suggestion for "multiple stakeholder community with representation and transparent governance" which was completely ignored. Another area of concern is preventing gaming and piggybacking. Given the delays, the DAG should include at least an extra point for applicants that have been active in their public outreach and communication campaigns for at least a year. This will prevent last-minute piggyback riders who want to be "paid off" to leave. If the outreach and communication effort is a big deal to ICANN, then applicants with this component should be given a small advantage.

I would also re-organize the Business Constituency. The organization is run by a handful of people, who do not welcome others to join their constituency from the business community and are what I call a clique. I applied to be part of the organization to be rejected. The reason cited was a conflict of interest because I am a gTLD applicant. They were in violation of their own charter rejecting me. They did not follow their own rules. Section 3.3.2 is clear. You can not be admitted if your prime business is a registry, registry operator, prospective registry, registrar, reseller, or otherwise related to domain name supply. I hate to break it to the Business Constituency, but my prime business is not a registry, unless they think I am from the future, that new gTLDs have launched and .music domains are available for registration to the music community. This is just as unacceptable as their website, which resembles a website from the late 90's that uses frames. It would help to update the site from time to time as well.

What would I do with financial fairness and transparency for gTLD applicants?

One area that is not transparent to me is the $185,000 gTLD application fee. What is the breakdown of the application? Why did IDN ccTLDs applicants only pay $26,000 and allowed to ask for a fee waiver? You would think governments can come up with $26k, right? However, I am perfectly fine with a high application fee because it would attract only-serious applicants with adequate capital to run a registry. What I have a problem with is ICANN double-dipping and taking advantage of applicants.

For example, my plan was to apply for IDN gTLDs as well under the same .music application in different IDN language scripts. Only thing that would change in the application is the translated language script string equivalent. Why would ICANN ask for $185,000 for every equivalent translated string? If this fee persists I am afraid ICANN will run into troubles with their financial transparency and breakdown of fees. Why pay the same evaluator the same amount of money for looking at the same application more than once, with the only difference being the translated string equivalent? If there is any cost to evaluating IDN technical specifications/needs, then that should be the additional cost imposed. I expect ICANN to look into this issue seriously. There is no way any reasonable person would pay $185k per equivalent, translated string which can all fall under one application.

Conclusion

ICANN: (tbd) - To be determined

By Constantine Roussos, Founder of DotMusic
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Years and Dimes Stuart Lawley  –  Jun 08, 2010 1:43 PM PDT

Some interesting points Constantine. I genuinely believe that ICANN staff have been working as quickly and as diligently as possible to get the Applicant Guidebook finished and get new gTLDS going at the earliest opportunity.

IMHO, one of the major speed bumps is the influence of the governments. I remember sitting in Michael Gallagher's office at the NTIA in Washington DC in September 2005, just after the furore over .xxx blew up and to paraphrase, his comments were " Listen, you are dealing with government now and we spend years like you spend dimes". How true that turned out to be. One issue that has befuddled me over the last year or so is why ICANN repeatedly issues the latest DAG just weeks before the next public meeting with the certainty that the GAC are going to say " We only just got the new DAG, we are Governments, we act slowly, we cannot comment on latest DAG v.X until Y months in the future by which time the community is just getting DAG V x+1, on so it goes on...At this rate , personally I can see a DAG 6 or 7 before it is final, unfortunately.

Your comments on the community qualifying standards are very accurate and, in reality it is unlikely many of the would be community applicants, perhaps including your own (I am not sure whether you were planning to apply as a community gTLD), will struggle to reach the requisite points score after spending huge sums of money over many years building your "community". Its a tough one. I guess the outcome may be more lucrative auctions for ICANN for some interesting new gTLDS like .music, .sport, .gay etc.

Just my two cents worth, good luck and see you in Brussels.

Hey Stuart,If you look at the latest Constantine Roussos  –  Jun 08, 2010 4:26 PM PDT

Hey Stuart,

If you look at the latest DAG, there are no surprises. GAC and Fortune 500 trademark attorneys/lobbyists have spent an enormous amount of time dissecting DAG and its components up. Everything seems to be going as planned and ICANN has to take the position to say enough is enough with going around in circles. However, I can not deny the progress that has been made in regards to trademarks and rights holders.

GAC, governments and ICANN are out celebrating launches of IDN ccTLDs such as Russian and Arabic, so there are no more excuses giving gTLD IDNs unfair treatment. If it is all about public interest, why are ccTLDs the ONLY option available for users of those regions? This is government monopoly to me. For the sake of equality and fair representation ICANN is left with nothing left but to say to governments that they got what they wanted in regards to IDN ccTLDs and now ICANN has to do its part to bring innovation, more options and increase competition in those regions. In my opinion, governments will do what is in their best interest, which is having a singular state run IDN domain name registry monopoly. ICANN has to draw the line at some point. What is happening is quite frustrating to myself and others to witness.

I assure you that ICANN will run in a lot of trouble if its goal is a money grab and to push for auctions. By not solidifying the definition of community, this is what it all points to. And yes, you are right. It would be a waste of years of time and loads of money from my part. However I am excited to say I am making some incredible progress with incorporating an artist/trademark verification system together with music rights organizations, akin to Twitter verified accounts.

I will be giving a .music presentation in New York at the SoundCtrl Music Event as part of Internet Week NY on Thursday. I am hoping to have the presentation up for everyone to see in the next week before Brussels. .music is co-sponsoring the event with Pepsi and Eventbrite. Always a challenge giving presentations when everything at ICANN is yet "to be determined."

I hope everything works out well with .xxx as well. Just a frustrating situation altogether. Best of luck in Brussels as well.

Constantine Roussos
.music

Business Constituency Patrick Vande Walle  –  Jun 09, 2010 2:53 AM PDT

Constantine,

The "trick" to join the BC is to have different hats. You could for example apply under the name of your consulting business, and work on a TLD application under a different hat in parallel. It is apparently accepted by the BC.

What would be much more transparent is a "new gTLD applicants" constituency within the GNSO. Right now, those who have much of the power to draft the policies to be followed by new entrants are the incumbents. Hence, all this fuss about registry/registrar separation.

Hey Patrick,Thank you for letting me know Constantine Roussos  –  Jun 09, 2010 8:28 AM PDT

Hey Patrick,

Thank you for letting me know the "trick" to joining the Business Constituency. As you can tell, I am learning the ropes at ICANN and figuring out the loopholes, despite my obvious hesitation to be thinking in this manner. Just the mere fact that I have to be thinking in this way is just unacceptable to me but thank you for the tips.

I am open for a new gTLD applicant constituency within the GNSO but if history stands, would anyone at ICANN bother to listen to what we have to say? Like you said all the incumbents have the power. I am quite fascinated with registry/registrar separation being an issue. If the issue is Verisign, Afilias or Godaddy becoming more powerful with integration, why doesn't the GNSO suggest to exclude registries/registrars with let us say significant market power in the likes of 2 million registrations under their belt? If ICANN wants others to compete with the giants, then where are the incentives for smaller registries/registrars to join the party and go head on with them?

Wait isn't ICANN all about competition and innovation? Why are things that are so obvious to so many of you not even considered? I think something has to be done to bring down the whole notion of politics, lobbying and market power influence upon the ICANN Board and other constituencies. Won't small business and consumers benefit? Why doesn't anyone talk about Verisign, Afilias or Godaddy market power at these meetings, address the real issues and implement policies to how to help spur competition and give incentives to new entrants to somewhat level the playing field.

One one hand, you have the incumbents saying that they want no change because they want to still hold the power and on the other hand you have new applicants who don't speak up because they do not want current smaller registries/registrars competing with them in the application round (unless loopholes are found of course). I always say, the more competition the better. It will only drive us to have better products, better prices and offerings to the public.

Constantine Roussos
.music

Factual Corrections Kristina Rosette  –  Jun 09, 2010 7:41 AM PDT

Constantine,

If you'd bothered to ask me, I would have given you the correct information below: 

1.  During the referenced INTA panel session, I did not suggest litigation as a way to slow down the introduction of new gTLDs.  I was asked if new gTLDs are inevitable.  I said "Yes, unless one of two things happens:  (1) litigation by trademark owners or parties unhappy with the outcome of the vertical integration debate; or (2) governmental action." I made very clear in my statement about litigation that I was simply reporting what I had heard about potential strategies of some entities. Several members of the ICANN community later asked me if I was advocating litigation.  If you had done the same, I would have told you that I was simply reporting what I have heard from numerous sources. 

2.  I will give you the benefit of the doubt that your statement "their [attorney] propensity to say and do anything to slow the process so that they ultimately get paid more" was not a description of me.  If you intended to describe me, you did so falsely.  Had you bothered to ask, I would have told you the same thing that I've told numerous others privately, publicly (including at open GNSO Council meetings) and on several ICANN lists:  All of the time I spend on GNSO Council and working group matters is non-billable. That means that it (a) is not charged to or paid by a client; and (b) does not "count" towards the hours I am expected to work.  In other words, every hour I spend on ICANN matters means that I have to spend an additional hour working.  There are many other members of the ICANN community who make a lot of money on their policy work.  I am not one of them.

3.  The firm name is Covington & Burling LLP.

Kristina Rosette

Hey Kristina,You should look at the article Constantine Roussos  –  Jun 09, 2010 8:10 AM PDT

Hey Kristina,

You should look at the article and the pdf on page one.

Quote: "Kristina Rosette of Covington & Burling suggested litigation is a possibility to slow down the application launch."

Well it seems that your statement was taken out of context. Perhaps you should contact the writer/journalist to at least edit your statement because it clearly suggests what it means and gives people and the community the wrong idea. I guess they missed the part that you just explained to me.

I understand where you are coming from Kristina and the notion of non-billable hours. I find it difficult to believe people ultimately work for free. I give music away for free, give seminars on SEO for free and speak at events for free as well. This is all the new paradigm of getting yourself out there, increasing exposure and then waiting for the real "billable" clients to come in and inquire about your services.

Well I am glad that your opinion is that suing ICANN to delay litigation is not a smart move, especially since they bent over backwards to include all the trademark provisions in the new DAG. For what it is worth, trademark attorneys did an excellent job getting what you wanted from ICANN and looking over trademark holders, so clients of many must be more than happy with both the delays and the results.

To be fair, INTA is the one who reported it ambiguously John Berryhill  –  Jun 09, 2010 10:13 AM PDT

The problem is INTA's own reportage.

(You'd be surprised how liberating it is to get off of the billable hour hobby horse.  Every solo with whom I've discussed it says, "I only regret not having done it sooner.")

What theory would justify a lawsuit against ICANN? Philip S Corwin  –  Jun 15, 2010 12:40 PM PDT

I'm intrigued by this notion of a lawsuit being filed against ICANN to delay the launch of new gTLDs. (And I understand that you are not advocating it, Kistina, just reporting that you'd that heard others were considering it.) A suit filed pre-launch on the grounds that the trademark protections were not sufficiently robust would necessarily occur before any actual harm (infringement) had taken place — so wouldn't this be exactly the kind of seeking of an advisory judicial opinion that the "case and controversy" standard of the U.S. Constitution was designed to prevent(and it would be a U.S. lawsuit, given ICANN's domicile). And that's not even mentioning that the developmental process has gone on for two years (we're now on the fourth and not necessarily last version of the DAG), and that we had the IRT followed by the STI on trademark considerations, so it's hard to make a case of inadequate procedural due process. On top of that, the new gTLD rights protection rules, while not all that some advocated, are still a lot stronger than for incumbent gTLDs like .com, but no one has ever sued ICANN on any theory for cybersquatting and other infringement at existing gTLDs — they go after the perpetrator via the UDRP or national laws like the ACPA.
So unless ssomeone can articulate a reasonable legal theory under which such a lawsuit could be brought, it's hard to imagine a U.S. court enjoining the launch of new gTLDs on speculative allegations of potential future harm to rights holders.

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