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ICANN slashes millions from its budget

Kevin Murphy, January 22, 2018, 13:50:03 (UTC), Domain Policy

ICANN has cut $5 million from its annual budget, warning the community that difficult decisions have to be made amid a slowing domain name market.

Staff and community members will all be affected by the cuts, whether in the form of less generous pay raises or fewer travel opportunities.

Cuts have also been proposed to international outreach, tech support, contractual compliance and translation services.

The organization at the weekend published for comment its proposed budget for fiscal 2019. That’s the year that begins July 1, 2018.

It would see ICANN spend $138 million, $5 million less than it expects to spend in fiscal 2018.

Four of the five top-line areas ICANN reports expenses will be cut for a total of $12 million in savings, while one of them — personnel — is going up by $7.3 million.

This rounds out to a $5 million cut to the total FY19 ICANN budget. Here’s the breakdown:

  • Personnel costs going up from $69.5 million to $76.8 million, up $7.3 million.
  • Travel and meetings costs are to go down from $17.8 million to $15.6 million, a $2.2 million saving.
  • Professional services costs will go down from $27.7 million to $23.4 million, a $4.3 million saving.
  • Administration and capital costs will go down from $22.5 million to $17.8 million, a $4.7 million saving.
  • The contingency budget is going down from $5.3 million to $4.5 million, a $800,000 saving.

Personnel costs are going up due to a combination of new hires and pay rises, but the average annual pay rise will be halved from 4% to 2%, saving $1.3 million, ICANN documentation states.

Headcount is expected to level out at about 425, up from the current 400, by the end of FY19.

The travel budget is going down due to a combination of cuts to services provided at the three annual meetings and the number of people ICANN reimburses for going to them.

The Fellows program — sometimes criticized for giving people what look like free vacations for little measurable return — is seeing the biggest headcount cut here. ICANN will only pay for 30 Fellows to go its meetings in FY19, half the level of FY18. The Next Gen program, a similar outreach program for yoof participants, goes down to 15 people from 20.

The Governmental Advisory Committee will get its number of funded seats reduced by 10 to 40. The ALAC and the ccNSO also each lose a few seats. Other constituencies are unaffected.

At the meetings themselves, translation is to be scaled back to be provided on an as-requested basis, rather than automatically translating everything into all six UN languages. Key sessions will continue to have live interpretation.

Outside of the three main meetings, ICANN is pulling back on plans to expand its irregular “capacity building” workshops in “under-served” areas of the world.

It’s also slashing the “additional budget request” budget by 50%.

In terms of compliance, a proposed Technical Compliance Monitoring system that was going to be built this year — a way to make sure gTLD registries and registrars are stable and secure — appears to be at risk of being deprioritized.

ICANN said it “will develop an implementation plan in due time, depending on the RFP results and, if needed, work with the Board to identify necessary resources and funds to support implementation of the project.”

The documents published today are now open for public comment until March 8.

The cuts I’ve reported here can be found from page 19 of this document (pdf).

The reason for the cutbacks is that ICANN’s revenue isn’t growing as fast as it once did, due to the slower than expected growth of the domain name industry in general. I’ll get to that a later article.

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