Why I Voted to Sell .ORG

By Richard Barnes
Richard Barnes

Hi, I'm Richard. I've been around the Internet for a while. I work for Cisco now, and used to lead security for Firefox. I've published a few RFCs and served on the Internet Engineering Steering Group (the board of the IETF). I was a co-founder of Let's Encrypt and I currently serve on its board. I care about the Internet, and I care about nonprofits.

I'm also a member of the Board of the Internet Society, and in that role, I joined the board's unanimous decision to sell the Public Interest Registry (PIR), the registry for the .org top-level domain, to Ethos Capital. Since this transaction has gotten some attention, I'd like to speak a little about why, in my estimation, this deal is a good one for the Internet.

It basically comes down to two things:

  1. The Internet Society does great work protecting the Internet and bringing it to the people who need it most — work that is way more impactful than leasing domain names. This transaction secures that work's future and independence.
  2. Ethos is a worthy successor to the Internet Society as the steward of .org.

The Internet is bigger than .org

There's no doubt that .org has a big impact on the online brand and identity of nonprofits. But the impact of the Internet Society is much broader than that. For those who might be unfamiliar with the Internet Society, our mission is as follows:

The Internet Society supports and promotes the development of the Internet as a global technical infrastructure, a resource to enrich people's lives, and a force for good in society.

Our work aligns with our goals for the Internet to be open, globally-connected, secure, and trustworthy. We seek collaboration with all who share these goals.

Obviously, that's a much bigger project than just leasing domain names! Some highlights of our work include:

For more detail on what we have planned, check out the 2020 Action Plan.

This transaction will put that bigger mission on a solid footing — so that the Internet Society can provide much more substantive help to nonprofits than merely leasing domain names, and with more continuity over time. While it's true that running .org provided a relatively steady income stream, it effectively staked most of our revenue on a single business, and required a certain amount of our resources to be spent managing that business, distracting from the broader mission. Especially as PIR has grown over time, this situation has become increasingly untenable. Establishing a more diverse portfolio of investments will allow us to have more predictable revenue over time, and to take a longer-range perspective when it comes to achieving our mission.

.org is going to be fine

Many of the current concerns about .org are premised on a presumption that prices will rise, based on a distrust of private equity and the affiliations of some of the investors. Those concerns are understandable, but I would encourage people to look at what Ethos themselves have said about their intentions with regard to .org, namely that they intend to:

So if we take Ethos at their word, they should be just as good a steward for .org as the Internet Society has been, with robust ties to the community and an explicit public-benefit orientation.

On the question of the wholesale price of a .org domain, the impact is likely to be very limited. Ethos has said that their plan is to "live within the spirit of historic practice," that is, to manage prices roughly as PIR would have under the stewardship of the Internet Society. If they impose the maximum 10% price increase plan for ten years, the price will be around $26 per year — still quite affordable.

Even in the worst case, if Ethos considers dramatically increasing prices (which, to be clear, we do not expect them to do!), the Registry Agreement for .org requires a 6-month notice period during which domain owners can lock in a 10-year registration at pre-increase rates. This should seriously discourage Ethos from doing this, because it would take 10 years for the new high rate to even take effect for existing registrants, and new registrations would likely fall off right away. So while there may not be an explicit prohibition on larger price increases, there is a strong commercial disincentive.

We're all trying to make the Internet a better place

The mission of the Internet Society is to support and promote the development of the whole Internet. Not the domain name industry, not just .org domain owners — everything. That's a big, complicated challenge. In making this decision, we considered what would be in the best interests of the Internet Society, .org domain holders, and the broader, global Internet. The Internet Society board did not take this decision lightly. We recognize that there is risk involved, and that we are asking the community to trust in our assessment of the risk. As I've outlined above, my assessment is that Ethos is a sufficiently trustworthy partner that the risks in handing over .org are limited, and offset by the potential to put a large pool of capital to work for the good of the Internet.

When this transaction completes, the Internet Society will be in a stronger position than ever to build, protect, and defend the Internet. To all the people who are learning about the Internet Society for the first time as a result of this transaction: Please stay in touch. With our increased resources, it will be more important than ever that we work together as a whole community. I look forward to working with all of you to make the Internet a resource to enrich people's lives, and a force for good in society.

By Richard Barnes, Member of the Internet Society Board of Trustees. Richard Barnes is Chief Security Architect for Collaboration at Cisco, helping make it possible for people to work together more securely. He also serves on the boards of the Internet Society and the Internet Security Research Group (the organizational home of Let's Encrypt), the latter of which he help co-found a few years ago.

Related topics: Domain Names, Internet Governance

Comments

Small correction: there is no requirement to Rubens Kuhl  –  Nov 27, 2019 12:40 PM PST

Small correction: there is no requirement to give 6-month notice of price increases to registrants, only to registrars. It's up to registrar to pass that information along to registrants or not, at its discretion.

That's true. I'm working on the Richard Barnes  –  Nov 27, 2019 12:58 PM PST

That's true.  I'm working on the assumption that in practice, that information will percolate out.  As I believe it has in the past.

Situation has changed Rubens Kuhl  –  Nov 27, 2019 1:04 PM PST

In the past ICANN and legacy registries determined pricing, and that information got very public due to media attention to ICANN. Pricing changes in new gTLDs, which is the benchmark to what .org will have if pricing is changed, had very lower publicity overall, but no new gTLDs of the .org size has raised prices. I wouldn't assume one way or the other in this regard.

It's understandable that you'd want to increase Peter Cobertos  –  Nov 27, 2019 2:54 PM PST

It's understandable that you'd want to increase the prices to cover the cost of scaling, but letting a corporation so far removed from all of the individual owners of .org domains price a domain however it sees fit with little recourse from the .org domain owners is a recipe for disaster. If that corporation continues to grow it's costs with all these extra programs and hiring, there's no cost ceiling and it's inevitable that domain prices will climb, pushing out so many legitimate people. And considering this shift is contrary to what anyone who owns a .org domain wants (https://savedotorg.org/), I have very little trust for Ethos Capital.

This is why efforts like https://handshake.org/ are so worthwhile. Non-scarce technical entities as important as .org should be kept as far away from private investment money as possible. They're a service to the people, not a product to capitalize on.

Something is lost forever Roberto Gaetano  –  Nov 28, 2019 8:55 AM PST

Dear Richard,

I am a .org registrant. I was proud of the fact that part of the money I was spending went to ISOC for the very projects you have described.
This is now gone.

My .org domain name is not just a domain name, is the digital identity that makes me part of the .org community. The fact that there are also commercial members in this community is irrelevant because the image that we project is that of not for profit, and to have the house hosting us being itself not for profit was a reassuring affirmation of this identity.
This is now gone.

When I applied for the PIR Board I was proud to become part of a wider community of which ISOC was the steward, that was working together with the registry, registrants and users for the benefit of the internet worldwide.
This is now gone.

Since I have started becoming involved in the Internet I had a strong belief that it was possible to act after discussion with the stakeholders and that the community could be involved before making strategic decisions.
This is now gone.

When the I* community started operating I believed that ISOC could be the core organization that was leading by example, putting ideals before and above money.
This is now gone.

You know that, in particular in the last couple of years, there have been disagreements between our two Boards - or at least parts thereof - but they have been solved with the spirit of collaboration that two travellers who share the same journey always have. Not even in my worst nightmares I would have thought that we were getting to the point that we would have taken different paths.

Be happy and prosper with the financial stability you have achieved, but be aware that you have paid a price - an immaterial one, but a very important one.

Roberto

The .ORG Sale Is a Radical Departure That Puts the Internet at Risk Jacob Malthouse  –  Nov 28, 2019 10:10 AM PST
Your entire argument hinges on we trust Kevin Ohashi  –  Nov 28, 2019 11:43 AM PST

Your entire argument hinges on we trust Ethos Capital and their meaningless plans with no track record. They will seek a meaningless certification (B Corp). They plan to keep price increases around 10% per year. Plans never changed before, like ISOC didn't plan to sell PIR? What makes Ethos a worthy successor? It's half year existence and non existent track record?

The logic of it will take 10 years for price increases to actually hit registrants of .ORG is absurd. It's paying an interest free loan for the right not to be charged more later. Not to mention it's taking away funds from today when many non profits operate on shoe string budgets. Furthermore, the idea that it is a disincentive is laughable at best. They get possibly more money up front as people lock-in ten years, while the majority will surely not notice and be charged higher rates for years to come.

When was the last time PIR made less money Y/Y? It's a money printing monopoly, was that not enough for you? You had to sell to a capital firm of ICANN insiders who will exploit it. PIR hasn't raised prices in three years, and it's become more profitable. Ethos is already saying they will be raising prices 10% per year, or that's their plan. Does that sound like a good steward of .ORG?

Let's call your argument what it really is, selfish interest in putting your own organization above everyone else's. You value Internet Society's work more than every other non profit that exists or might exist in the future. You think you deserve even more money to do your work and are OK that it's at the expense of everyone else, because - look at the good stuff we do! You justify it by saying even at 10% for 10 years, $26 isn't much. It's still more money being taken away from everyone else at the scale of over 10 million times per year. It's the office space stealing a penny on every traction and hoping nobody notices. Except you're comfortable doing it at a larger scale and taking it away from the non profit space.

I agree Karl Auerbach  –  Dec 03, 2019 12:00 PM PST

I agree with your point that what ISOC is doing is in essence shaving money from other non-profits and their public-benefit goals to enhance ISOC's own public-benefit goals.  In essence ISOC is saying to other non-profits "our non-profit goals are better than yours".

10% per year is a mighty fine rate of return Karl Auerbach  –  Dec 03, 2019 11:53 AM PST

You say that 10% per year after ten years works out to a "quite affordable" $26 - not counting registrar fees.  But you are falling into the compound interest trap - over short time periods, it seems not so bad.  But the years accumulate quickly.  That "affordable" $26 becomes about $175 - per year (plus registrar fees) - after 30 years.

I assist multiple non-profit organizations.  Many of them are getting by only by the thinnest of margins.

That 10% compound interest on their Internet identity will hurt; it will be money that will be sucked out of millions of non profits into a for-profit hedge fund.

.org predates ICANN and PIR.  There are non-profits in .org that have invested decades into building their domain name presence.  This sale places that all at risk.

Moreover, it has been estimated that the actual cost of provision of the .org registry service is under (and by some estimates far under) $1 per name per year.  And those costs are not going up by 10% per year, in fact many of those costs have gone down substantially over the years.

That means that the "quite affordable" $26 (after ten years) is really nearly all profit for the registry - profit taken out of captive customers.

And does anyone think that Ethos Capital (or its financial backers) are not planning to quickly recoup that $Billion+ it spent?

As for "B Corporation" - It's a bunch of goody-two-shoes feel-good statements that are not binding.  Sounds a lot like "Tethics" on the HBO's Silicon Valley TV series - empty platitudes that can be safely ignored and easily evaded.

An interesting twist on this is that all of the registrants in .org, if they wished, could establish a new .org registry, outside of ICANN and convince root server operators - perhaps with a cash inducement - to drop the NS and DNSSEC pointers to ICANN's .org and pick up the forked .org instead.  Such a registry could be ultra inexpensive if it were to abandon all of the ICANN mandated overhead, such as ten year maximum registrations and per-year rents, and use something like a permanent, never expiring, registration for a one time fee plus small fees for operational things like updating NS records.