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GAC Early Warnings just got a whole lot more important

Kevin Murphy, January 18, 2013, 12:25:49 (UTC), Domain Policy

ICANN will let new gTLD applicants change their applications in order to respond to the concerns of governments, it has emerged.

Changes to applications made as a result of Early Warnings made by the Governmental Advisory Committee “would in all likelihood be permitted”, ICANN chair Steve Crocker informed the GAC this week.

ICANN is also looking at ways to make these changes enforceable in the respective applicants’ registry contracts.

Combined, the two bits of news confirm that the GAC will have greater power over new gTLD business models than previously anticipated.

The revelations came in the ICANN board of directors’ official response to GAC advice emerging from last October’s Toronto meeting.

After Toronto, the GAC had asked ICANN whether applicants would be able to change their applications in response to Early Warnings, and whether the changes made would be binding.

In response, Crocker told his GAC counterpart, Heather Dryden, that ICANN already has a procedure for approving or denying application change requests.

The process “balances” a number of criteria, including whether the changes would impact competing applicants or change the applicant’s evaluation score, but it’s not at all clear how ICANN internally decides whether to approve a request or not. So far, none have been denied.

Crocker told Dryden:

It is not possible to generalize as to whether change requests resulting from early warnings would be permitted in all instances. But if such requests are intended solely to address the “range of specific issues” listed on page 3 of the Toronto Communique, and do not otherwise conflict with the change request criteria noted above, then such request would in all likelihood be permitted.

The “range of specific issues” raised in the Toronto advice (pdf) are broad enough to cover pretty much every Early Warning:

  • Consumer protection
  • Strings that are linked to regulated market sectors, such as the financial, health and charity sectors
  • Competition issues
  • Strings that have broad or multiple uses or meanings, and where one entity is seeking exclusive use
  • Religious terms where the applicant has no, or limited, support from the relevant religious organisations or the religious community
  • Minimising the need for defensive registrations
  • Protection of geographic names
  • Intellectual property rights particularly in relation to strings aimed at the distribution of music, video and other digital material
  • The relationship between new gTLD applications and all applicable legislation

Some Early Warnings, such as many filed against gTLD bids that would represent regulated industries such as finance and law, ask applicants to improve their abuse mitigation measures.

To avoid receiving potential lethal GAC Advice this April, such applicants were asked to improve their rights protection mechanisms and anti-abuse procedures.

In some cases, changes to these parts of the applications could — feasibly — impact the evaluation score.

The GAC also made it clear in Toronto that it expects that commitments made in applications — including commitments in changes made as a result of Early Warnings — should be enforceable by ICANN.

This is a bit of a big deal. It refers to Question 18 in the new gTLD application, which was introduced late at the request of the GAC and covers the “mission/purpose” of the applied-for gTLD.

Answers to Question 18 are not scored as part of the new gTLD evaluation, and many applicants took it as an invitation to waffle about how awesome they plan to be.

Now it seems possible they they could be held to that waffle.

Crocker told Dryden (with my emphasis):

The New gTLD Program does not currently provide a mechanism to adopt binding contractual terms incorporating applicant statements and commitment and plans set forth within new gTLD applications or arising from early warning discussions between applicants and governments. To address concerns raised by the GAC as well as other stakeholders, staff are developing possible mechanisms for consideration by the Board New gTLD Committee. That Committee will discuss the staff proposals during the upcoming Board Workshop, 31 Janaury – 2 February.

In other words, early next month we could see some new mechanisms for converting Question 18 blah into enforceable contractual commitments that new gTLD registries will have to abide be.

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Comments (19)

  1. Andrew says:

    I would guess that many of the companies going for restricted use of generic terms, most notably Amazon, would still take that fight to the Board. Those, combined with calls for greater enforcement mechanisms for TLDs related to regulated markets that you mention, are the great majority of the early warnings issued (all of course coming from GAC Chair, Heather Dryden).

    I have not yet looked closely enough at the differences in mechanisms described in the applications but taking .cpa for instance, Donuts received a warning that it did not have enough safety measures while Google and TLDH did not. I would then venture to guess that it would not be a total loss, in terms of implementation/registration#s/profit, for Donuts to concede and add policies similar to its competitors in its application.

    Of course that is just Early Warnings, should the scope of the GAC’s concerns widen significantly when creating official GAC Advice then you are right, the GAC could be influencing a lot of potentially significant rewrites and changes in applications.

  2. Tom G says:

    Google has suggested on multiple occasions they are willing to open their closed registry apps.

    They recognized early on that these would be problematic

    If Amazon does not, they’re stupid.

  3. Alexander Schubert says:

    Hi Kevin,

    thanks for the article.

    But I read the Boards communication to the GAC differently.

    The board made it quite clear that any applicant can apply for any change at anytime. It will be granted in any case if certain criteria are met. Completely unrelated to the “driver” of such change request.

    I did not read that the driver (motivation) “GAC early warning” does construct any kind of exception to these rules.

    And why should it? A change of an application is a change. It has to meet certain (universal) criteria. If it doesn’t then it will not be granted. At least that is how I read it. I might be wrong.

    Alexander.gay

    • Rubens Kuhl says:

      +1 with Alexander comment.
      The current change queue is somewhat high, and even an applicant that starts now a change request might not get it done before Beijing…

      • Kevin Murphy says:

        I think this is important because it’s sent a message to the GAC that a) they can ask applicants to make any changes they want, and the parameters for approval are rather broad and b) applicants *may* be contractually bound to whatever changes they then make.

        Politically, I believe this makes GAC warnings much more important than they were before. There may be less impetus for a government to drop its early warning in order to “play nicely” if there’s a clear, documented path for that warning to become Law.

        • Alexander Schubert says:

          Hi Kevin,

          I would interpret the opposite from the letter. Yes, the parameters are very broad but in no way that constructs any kind of “automatic approval”. On the contrary: It seems that almost nothing can really be changed. Small changes outside the scope of the application policies itself -like exchange of officers- might be considered in certain cases. But no “substantial” changes to the application itself. And why should ICANN accept substantial changes at all? That would have invited a certain behavior where applicants “test the ice” and if they have gone to far out simply retract. An applicant for a closed (single registrant) application can’t suddenly open their TLD for the public – it was applied for as closed TLD! Nice try but you went too far out on the ice and you are breaking in. Think about the next rounds: Whatever we do here in his round will be the blue print for applicant-behavior in the next round!

          The board quite clearly states: “GAC you can request whatever change you want – but the applicants can’t really change a lot. Certainly your early warnings will not make us accepting changes that we otherwise wouldn’t have been accepted anyways.”

          Alexander.gay

  4. Zack says:

    Hmmm. And here i thought the Applicant Guidebook was finalized and I knew what criteria I had to manage against. So what version of the Good ole guidebook does this put us on now and when is it being released?

    • Kevin Murphy says:

      If I recall correctly, the Guidebook has a few disclaimers saying it could be subject to change in future.

      • Zack says:

        Yes it does. It continues to be a moving target. It seems that ICANN could do better at foreseeing issues such a these. To me it seemed obvious that the next step for the GAC was to find ways to enforce their requirements yet no one at ICANN could see this coming? This would appear to require individual changes to Registry Agreements – something that I thought was a no-no for ICANN.

        Wonder what the gTLD program will look like in 5 years…

  5. Ray Marshall says:

    Like other policies and procedures used by companies, the guidebook is a living document that will be subject to changes to address unforeseen issues. We can either wait for perfection and take forever to move forward, or allow for changes and move on.

    • zack says:

      Your analogy is not on point. This is not Microsoft saying to it’s sales department that they have to fundamentally change they way they manage customers. This has a much bigger impact to businesses trying to build their operations around a set of supposedly agreed on criteria. Many of these businesses do not have revenue yet and are patiently (or impatiently) waiting to move forward with their business plans. Now their business plans may have to change significantly.

      That aside, yes – I expect the Guidebook to have changes over time…however, we haven’t even launched the first gTLD and now we seem to be working on solutions in search of a problem. I go back to my earlier point..ICANN did not do a good job of foreseeing expected future changes. I understand that there are challenges with such a large, visible program and they are trying their best to move forward as quickly as possible. But let’s be real here…they seem to only plan about 2 to 3 months ahead and then say “we’ll deal with that issue when we get to it”. Even companies that develop internal policies and procedures at least spend some time trying to understand what is best for the business. ICANN seems to care little about the applicants that have applied to its gTLD program.

      • Ray Marshall says:

        Like I said, if you want nirvana, be prepared to wait forever. Otherwise, have the courage to move forward knowing that you’re not perfect, your plans are not perfect, and you’ll have to adjust in mid-stream. Perhaps your plans are always perfect. If so, you are very fortunate. I’ve yet to develop a plan and not make adjustments during implementation. Perhaps ICANN and I are the only ones that are not perfect.

  6. Government Cheese says:

    Interesting exchange here on this topic. Lets not forget that there are differences between GAC Early Warnings and GAC Advice which requires “consensus” — and that all applications aren’t necessarily the same—lets also not lose sight of the role and functions of a TLD registry operator here…..

    Those goverments that issued early warnings that merely suggested the withdrawal of an application as a “remediation” step would have egg on their face if all of a sudden they were to turn around and individually suggest alternatives…the only way the GAC could fairly introduce new “mechanisms” would indeed require consensus on a universal framework and set of criteria that justifies such newly required mechanisms…. (all strings, classes of strings, “regulated industry strings”….)….and which take into fair consideration the business, legal and technical impacts that would be contemplated by their “required” implementation on so many levels…

    Apart from introducing new functional or technical requirements or allowances for Rights Protections, or at best perhaps as part of more stringent security protocols, it would be entirely inappropriate for governments at this point to introduce new mandates on a one-size-fits-all level, at a class level or for any one specific string for that matter….without forcing significant disruption at the business level…

    On what credible basis would any government and the Board force a “closed” registry or a brand TLD for that matter to change its business model to being “open” or less restricted? If for example Amazon were forced to open up .book to allow publishers to be able to register a .book name without other “obligations” to amazons “IP-self interested model, it would seemingly only be on the basis of registrants being afforded to assert their TM rights beyond ways they are afforded to do so through the TM clearinghouse. What if Amazon planned to not charge for the names and instead were monetizing them through other means? How can a government or group of governments mandate that a brand which didnt apply as a community to open up their registry to allow others outside of the ecosystem that brand has defined to register names? How would governments account for Amazons business model impacts??? Or force changes to a brand’s intended use cases??? Would applicants be forced to reveal their pricing models or propritary plans in this process??? Totally overstepping their boundaries here…

    If for example governments were to insist that for a particular string that pre-screening or some form of validation were required, how would a non-community applicant conform without radically changing their entire model to account for this? What if the applicant raised money on the basis of P&L assumptions? The criteria and arguments that would need to be formed, let alone agreed on with the Board just seem entirely unreasonable and impractical….

    Perhaps there are a handful of strings for which more stringent security levels are necessary? Even in those limited cases, this fails to account for each applicants business model as possibly being different than what the actual string suggests might warrant as a matter of its semantic being….Just because someone applied for .pay, .bank or .cash doesn’t mean they’ve established a model that registrants will use it for purposes commerce….apart from privacy laws and security laws varying by jurisdiction, seems impractical for any government to introduce a new requirement in this area unless there were internationally recognized standards that every country were to enforce….and that sufficient reasoning could be justified…

    If the GAC and the Board want to make progress on any of this, they should first take a step back and establish a clear set of goals, objectives and parameters that can be backed with solid reasoning to support them. They must consider the very notion that introducing any formative changes at this stage would turn the entire new gTLD program on its head.

    Applicants who have devoted years of time toward securing funds based on proprietary business plans, financial models and projections can’t all of a sudden be forced to re-jigger their plans (if that were even possible) because of an illogical or high level premise on the part of governments that the established rules and requirements aren’t satisfactory at this point. The time for this was years ago when consensus was being formed and well before applications were able to be submitted…

    As this all pushes forward, the registry stakeholders group had better bring the applicant community together on any issues that could have catastrophic potential to derail or radically alter their plans and dreams. Government cheese.

  7. stit says:

    Kevin,
    When will we know who won the first round of gTLD’s ?
    as I’m interested in .auto and .web

    • Kevin Murphy says:

      As a rule of thumb, I’d say that the more exciting a TLD sounds, the longer it will take for it to come to market. We may well see the first ones mid-year, but I wouldn’t expect to see .web until 2014 at the absolute earliest. But it’s all guesswork — there are many many factors in play.

  8. Stit says:

    Thanx for your reply

  9. Kevin, what is your guess for .wine ?

    • zack says:

      The last .wine application is no 1,291 – belonging to Affilias. Assuming there are no private negotations for this string amongst the applicants then once the Affilias application is processed then all of the .wine applications can move to the next step in the process.

      Assuming again that all pass Initial Evaluation and there are no Objections pending then string contention begins immediately. I expect that the .wine winner would be ready for delegation around the summer of 2014 – assuming ICANN also sticks to the 20 per week pre-delegation rate and IANA etal mirror this rate.

      Lots of assumptions…including ICANN meeting its deadlines.

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