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Antitrust feds probing Verisign’s .web deal

Kevin Murphy, February 10, 2017, Domain Policy

US antitrust authorities are investigating Verisign over its anticipated operation of the .web gTLD.

The probe was disclosed by company CEO Jim Bidzos in yesterday’s fourth-quarter earnings call. He said:

On January 18, 2017, the company received a Civil Investigative Demand from the Antitrust Division of the US Department of Justice, requesting certain information related to Verisign’s potential operations of the .web TLD. The CID is not directed at Verisign’s existing registry agreements.

He did not comment further, beyond describing it as “kind of like a subpoena”.

Verisign acquired the rights to run .web at an ICANN last-resort auction last July, agreeing to pay $135 million.

Rather than applying for the gTLD itself, it secretly bankrolled shell company Nu Dot Co, which intends to transfer its .web contract to Verisign after it is signed.

ICANN is being sued by rival applicant Donuts, which claims NDC should have been banned from the auction. Afilias, the auction runner up, is also challenging the outcome.

But this new DoJ investigation, if we take Bidzos’ words at face value, appears to focus on what Verisign plans to do with .web once it is live.

It’s the view of many that .web would be the new gTLD best positioned as an alternative to .com, which makes Verisign hundreds of millions of dollars a year.

It’s my view that it would make perfect sense for Verisign to flush the $135 million and bury .web, rather than have a viable competitor on the market.

Verisign has repeatedly said that intends to “grow and widely distribute .web”, words Bidzos repeated last night.

The investigation is likely into whether Verisign wants to actually raise .web, or strangle it in its crib.

It seems the investigation was launched in the dying days of the Obama administration, so the recent changing of the guard at Justice — Attorney General Jeff Sessions was confirmed by Congress just two days ago — may have an impact on how it plays out.

ICANN’s Empowered Community to get its first test-drive after appeals panel vote

Kevin Murphy, February 8, 2017, Domain Policy

ICANN’s post-transition bylaws have only been in effect for a few months, but the board of directors wants to change one of them already.

The board last week voted to create a new committee dedicated to handling Requests for Reconsideration — formal appeals against ICANN decisions.

But because this would change a so-called Fundamental Bylaw, ICANN’s new Empowered Community mechanism will have to be triggered.

The Board Governance Committee, noting that the number of RfR complaints it’s having to deal with has sharply increased due to fights over control of new gTLDs, wants that responsibility split out to be handled by a new, dedicated Board Accountability Mechanisms Committee.

It seems on the face of it like a fairly non-controversial change — RfRs will merely be dealt with by a different set of ICANN directors.

However, it will require a change to one of the Fundamental Bylaws — bylaws considered so important they need a much higher threshold to approve.

This means the untested Empowered Community (which I’m not even sure actually exists yet) is going to get its first outing.

The EC is an ad hoc non-profit organization meant to give ICANN the community (that is, you) ultimate authority over ICANN the organization.

It has the power to kick out directors, spill the entire board, reject bylaws changes and approve Fundamental Bylaws changes.

It comprises four or five “Decisional Participants” — GNSO, the ccNSO, the ALAC, the ASO and (usually) the GAC.

In this case at least three of the five Decisional Participants must approve the change, and no more than one may object.

The lengthy process for the EC approving the proposed bylaws change is outlined here.

I wouldn’t expect this proposal to generate a lot of heated discussion on its merits, but it will put the newly untethered ICANN to the test for the first time, which could highlight process weaknesses that could be important when more important policy changes need community scrutiny.

ICANN’s divorce from the US cost $32 million

Kevin Murphy, February 6, 2017, Domain Policy

The IANA transition cost ICANN a total of $32 million, according to documentation released today.

The hefty bill was racked up from the announcment of the transition in March 2014 until the end of 2016, according to this presentation (pdf).

A whopping $15 million of the total went on lawyers.

IANA costs

Another $8.3 million went on other third-party services, including lobbying, PR and translation.

More than half of the overall expenses — $17.8 million — was incurred in ICANN’s fiscal 2016, which ended last June.

ICANN feeds troll, refuses to censor “rip-off” web site

Kevin Murphy, February 2, 2017, Domain Policy

ICANN’s board has rejected a formal demand that it “take down” the web site RipoffReport.com in what is possibly the strangest Request for Reconsideration case it has considered to date.

The almost 20-year-old site hosts reports from consumers about what they consider to be “rip-offs”. It’s seen its fair share of controversy and legal action over the years.

Somebody called Fraser Lee filed the RfR in December after (allegedly) trying and failing to get the site’s registrar, DNC Holdings (aka Directnic), to yank the domain and then trying and failing to get ICANN Compliance to yank DNC’s accreditation.

The request (pdf) is a rambling, often incoherent missive, alleging that RipoffReport contains “legally proven illegal defamatory, copyright infringing, hateful, suicidal and human rights depriving content” and demanding ICANN “take down the site RIPOFFREPORT.COM AS EXPECTED BY THEIR POLICIES OR RISK BEING SUED AS AN ENDORSER OF CYBER TERRORISM.”

ICANN’s Board Governance Committee has naturally enough rejected (pdf) the request, largely on the grounds that it does not have the authority to police internet content and that it could find no evidence that DNC had breached its contract:

the Requester ultimately seeks to have ICANN assume greater responsibility of policing purportedly illegal activity on the Internet, and attempts to place the burden on ICANN to regulate content on the Internet. That is not ICANN’s role. If content is to be regulated, that review and enforcement falls to institutions charged with interpreting and enforcing laws and regulations around the world, such as law enforcement

In a bizarre twist, the BGC further decided that “Fraser Lee” may not even be the person who filed the original complaints with DNC and ICANN Compliance.

“Fraser Lee, has never initiated a complaint with the ICANN Contractual Compliance department,” the BGC wrote.

A lengthy (and, one imagines, maddening) email thread between DNC’s lawyer and somebody called “Smith”, evidently provided by DNC to ICANN (pdf), appears show that at least two different identities are in play here.

It’s an odd one for sure, but it does have the virtue of getting ICANN’s board on the record again stating that it does not police content.

Trump’s ‘Muslim ban’ draws fire, creates confusion in ICANN community

Kevin Murphy, January 31, 2017, Domain Policy

At least two senior-level ICANN community members, including a new member of its board of directors, have been affected by US President Donald Trump’s controversial travel restrictions, imposed this weekend on the citizens of seven Muslim-majority nations.

The so-called “Muslim ban” has also attracted criticism from other members of the community.

Kaveh Ranjbar, Amsterdam-based chief information officer for RIPE/NCC and an ICANN director, said that he is unable to attend this week’s board retreat in Los Angeles because he holds an Iranian passport.

“I have checked this with ICANN’s general counsel and they have tried an external counsel with expertise in immigration,” Ranjbar told DI. “Their advice was that I might be able to travel but they were not sure. As you know the situation is really fluid and things change real fast.”

“After checking with the airline and looking at similar cases, I decided not to even try, because I did not want to risk deportation or being detained in the US,” he said.

Ranjbar was born in Iran but holds dual Dutch-Iranian citizenship.

He said he will participate remotely in the board retreat, likely until with 3am each day.

“However, the work of ICANN board is no different than any other board, it is mostly free exchange of ideas and discussing and challenging positions, outside of the formal setting of the meetings, that’s how you get a feel on your other colleagues positions and will be informed enough about their positions which will enable you to support or oppose with proper grounds and arguments,” he said. “I will miss that critical part.”

Non-Commercial Users Constituency chair Farzaneh Badiei is also affected. She’s Iranian, but recently relocated to the US on an academic visa.

She told NCUC members that she’s effectively stuck there, unable to attend an intersessional meeting in Iceland or ICANN’s March meeting in Denmark, for fear of not being allowed to return.

“I have been advised to take precautionary measures in light of the current draft executive order that might not allow current visa holders re-entry to the United States,” she said.

ICANN is still evaluating the situation.

“We are still trying to fully understand the potential impact of the President’s Executive Order on our community, Board and staff travelers. We want to ensure ICANN’s continued accessibility and openness,” a spokesperson said on Sunday.

ICANN does have Iranian-born staffers, but I’m not aware that any have reported travel problems as a result of the Trump move.

The travel ban has drawn fire from other related organizations.

Internet Society CEO Kathy Brown wrote that she was “deeply troubled” by the ban, adding:

Not only will the purported bans place an unwarranted burden on people in our organization, it is an anathema to the Internet Society whose values rest firmly on a commitment to an open, globally connected community dedicated to the open, global Internet. We are encouraged by the countries who have rejected the U.S. action this weekend and by the human rights organizations that have stood in solidarity with countless refugees and travelers who were so abruptly halted in entering the U.S.

The chairs of the IETF, IAOC and IAB indicated in a joint statement that they may reconsider holding future meetings in the US:

the recent action by the United States government to bar entry by individuals from specific nations raises concerns for us—not only because upcoming IETF meetings are currently scheduled to take place in the U.S., but also because the action raises uncertainty about the ability of U.S.-based IETF participants to travel to and return from IETF meetings held outside the United States….

Our next meeting is planned for Chicago, and we believe it is too late to change that venue. We recognize, however, that we may have to review our other planned meeting locations when the situation becomes clearer. We are already reviewing what to do as far as location for the next open North American meeting slot.

Meanwhile, the Internet Governance Project’s Milton Mueller blogged:

This has significant implications for Internet governance. Coordination and policy making for a global medium based on cooperation and voluntary standards requires open transnational institutions. Participation in those institutions requires the ability to freely travel. The United States can no longer be considered the leader, either politically or ideologically, of an open global Internet if its own society is mired in protective barriers… What a stroke of good fortune that the prior administration succeeded in freeing ICANN from the U.S. government in its waning months.

The travel ban is said to be “temporary”, lasting just 90 days, but some fear it may evolve into a permanent fixture of US policy.