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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.

URS comes to .mobi as ICANN offers Afilias lower fees

Kevin Murphy, December 27, 2016, Domain Registries

Afilias’ .mobi is to become the latest of the pre-2012 gTLDs to agree to adopt the Uniform Rapid Suspension policy in exchange for lower ICANN fees.

Its Registry Agreement is up for renewal, and Afilias and ICANN have come to similar terms to .jobs, .travel, .cat, .pro and .xxx.

Afilias has agreed to take on many of the provisions of the standard new gTLD RA that originally did not apply to gTLDs approved in the 2000 and 2003 rounds, including the URS.

In exchange, its fixed registry fees will go down from $50,000 a year to $25,000 a year and the original price-linked variable fee of $0.15 to $0.75 per transaction will be replaced with the industry standard $0.25.

It’s peanuts really, given that .mobi still has about 690,000 domains, but Afilias is getting other concessions too.

Notably, the ludicrous mirage that .mobi was a “Sponsored” gTLD serving a specific restricted community (users of mobile telephones, really) rather than an obvious gaming of the 2003-round application rules, looks like it’s set to evaporate.

Appendix S to the current RA is not being carried over, ICANN said, so .mobi will not become a “Community” gTLD, with all the attendant restrictions that would have entailed.

Instead, Afilias has simply agreed to the absolute basic set of Public Interest Commitments that apply to all 2012 new gTLDs. Text that would have committed the registry to abide by the promises made in its gTLD application have been removed.

But the change likely to get the most hackles up is the inclusion of URS in the proposed new contract.

URS is an anti-cybserquatting measure that enables trademark owners to shut down infringing domains, without taking ownership, more quickly and cheaply than the UDRP.

It’s obligatory for all 2012-round gTLDs, and five of the pre-2012 registries have also agreed to adopt it during their contract renewal talks with ICANN.

Most recently, ICM Registry agreed to URS in exchange for much deeper cuts in its ICANN fees in .xxx.

In recent days, ICANN published its report into the public comments on the .xxx renewal, summarizing some predictably irate feedback.

Domainer group the Internet Commerce Association, which is concerned that URS will one day be forced upon .com and .net, had a .xxx comment that seems particularly pertinent to the .mobi news:

Given the history of flimsy and self-serving justifications by [Global Domains Division] staff and the ICANN Board for similar actions taken in 2015, we are under no illusion that this comment letter will likely be successful in effecting removal of the URS and other new gTLD RA provisions from the revised .XXX RA. Nonetheless, we strenuously object to this GDD action that intrudes upon and debases ICANN’s legitimate policymaking process, and urge the GDD and Board to reconsider their positions, and to ensure that GDD staff ceases and desists from taking similar action in the context of future RA renewals and revisions until the RPM Review WG renders the community’s judgment as to whether the URS and other new gTLD RPMs should become Consensus Policy and such recommendation is reviewed by GNSO Council and the ICANN Board.

The Intellectual Property Constituency of the GNSO, conversely, broadly welcomed the addition of more rights protection mechanisms to .xxx.

The Non-Commercial Stakeholder Group, meanwhile, expressed concern that whenever ICANN negotiates a non-consensus policy into a contract it negates and discourages all the work done by the volunteer community.

You can read the summary of the .xxx comments, along with ICANN staff’s reasons for ignoring them, here (pdf).

The .mobi proposed amendments are also now open for public comment.

Any lawyers wishing to rack up a few billable hours railing against a fait accompli can do so here.

Donuts loses $22.5m .web lawsuit as judge rules gTLD applicants cannot sue

Kevin Murphy, November 30, 2016, Domain Registries

The promise not to sue ICANN that all new gTLD applicants made when they applied is legally enforceable, a California judge has ruled.

Judge Percy Anderson on Monday threw out Donuts’ lawsuit against ICANN over the controversial $135 million .web auction, saying the “covenant not to sue bars Plaintiff’s entire action”.

He wrote that he “does not find persuasive” an earlier and contrary ruling in the case of DotConnectAfrica v ICANN, a case that is still ongoing.

Donuts sued ICANN at first to prevent the .web auction going ahead.

The registry, and other .web applicants, were concerned that ultimately successful bidder Nu Dot Co was being covertly bankrolled by Verisign, which turned out to be completely correct.

Donuts argued that ICANN failed to adequately vet NDC to uncover its secret sugar daddy. It wanted $22.5 million from ICANN — roughly what it would have received if the auction had been privately managed, rather than run by ICANN.

But the judge ruled that Donuts’ covenant not to sue is enforceable. Because of that, he made no judgement on the merits of Donuts’ arguments.

Under the relevant law, Donuts had to show that the applicant contract was “unconscionable” both “procedurally” and “substantively”.

Basically, the question for the judge was: was the contract unfairly one-sided?

The judge ruled (pdf) that it was not substantively unconscionable and “only minimally procedurally unconscionable”. In other words: a bit crap, but not illegal.

He put a lot of weight on the fact that the new gTLD program was designed largely by the ICANN community and on Donuts’ business “sophistication”. He wrote:

Without the covenant not to sue, any frustrated applicant could, through the filing of a lawsuit, derail the entire system developed by ICANN to process applications for gTLDs. ICANN and frustrated applicants do not bear this potential harm equally. This alone establishes the reasonableness of the covenant not to sue.

Donuts VP Jon Nevett said in a statement yesterday that the fight over .web is not over:

Donuts disagrees with the Court’s decision that ICANN’s required covenant not to sue, while being unconscionable, was not sufficiently unconscionable to be struck down as a matter of law. It is unfortunate that the auction process for .WEB was mired in a lack of transparency and anti-competitive behavior. ICANN, in its haste to proceed to auction, performed only a slapdash investigation and deprived the applicants of the right to fairly compete for .WEB in accordance with the very procedures ICANN demanded of applicants. Donuts will continue to utilize the tools at its disposal to address this procedural failure.

It looks rather like we could be looking at an Independent Review Process filing, possibly the first to be filed under ICANN’s new post-transition rules.

Donuts and ICANN are already in the Cooperative Engagement Process — the mediation phase that usually precedes an IRP — with regards .web.

Second-placed bidder Afilias is also putting pressure on ICANN to overturn the results of the auction, resulting in a bit of a public bunfight with Verisign.

TL;DR — don’t expect to be able to buy .web domains for quite a while to come.

Afilias retains .org back-end deal

Kevin Murphy, November 15, 2016, Domain Registries

Public Interest Registry is sticking with Afilias to run the .org registry back-end.

The announcement came yesterday after a open procurement process that lasted for most of 2016.

Over 20 back-end providers from 15 nations — basically the entire industry — responded to PIR’s February request for proposals, we reported back in March.

Afilias retaining the contract is not a huge surprise. The bidding process was widely believed to be a way for non-profit PIR to reduce its costs, believed to be among the highest in the industry.

PIR said yesterday:

Afilias was selected as the best value solution based on the objective criteria and requirements set forth in Public Interest Registry’s procurement process. It is anticipated that Afilias will commence operations under the new contractual agreement on Jan. 1, 2018.

It’s very likely that the new deal will be worth a lot less to Afilias than the current arrangement, which costs PIR about $33 million per year.

In 2013, the last year for which we have Afilias’ financials, .org brought in $31 million of its $77 million revenue.

It’s believed that PIR is currently paying about $3 per domain per year, but Kieren McCarthy at The Register, citing unnamed industry sources, reckons that’s now been bumped down to $2, saving PIR about $10 million per year.

The .org gTLD has about 11.2 million domains under management, but its numbers have been slipping for several months, according to registry reports.

Verisign and Afilias in open war over $135m .web

Kevin Murphy, November 11, 2016, Domain Registries

Two of the industry’s oldest and biggest gTLD registries escalated their fight over the .web gTLD auction this week, trading blows in print and in public.

Verisign, accused by Afilias of breaking the rules when it committed $130 million to secure .web for itself, has now turned the tables on its rival.

It accuses Afilias of itself breaking the auction rules and of trying to emotionally blackmail ICANN into reversing the auction on spurious political grounds.

The .web auction was won by obscure shell-company applicant Nu Dot Co with a record-setting $135 million bid back in July.

It quickly emerged, as had been suspected for a few weeks beforehand, that Verisign was footing the bill for the NDC bid.

The plan is that NDC will transfer its .web ICANN contract to Verisign after it is awarded, assuming ICANN consents to the transfer.

Afilias has since revealed that it came second in the auction. It now wants ICANN to overturn the result of the auction, awarding .web to Afilias as runner-up instead.

The company argues that NDC broke the new gTLD Applicant Guidebook rules by refusing to disclose that it had become controlled by Verisign.

It’s now trying to frame the .web debate as ICANN’s “first test of accountability” under the new, independent, post-IANA transition regime.

Afilias director Jonathan Robinson posted on CircleID:

If ICANN permits the auction result to stand, it may not only invite further flouting of its rules, it will grant the new TLD with the highest potential to the only entity with a dominant market position. This would diminish competition and consumer choice and directly contradict ICANN’s values and Bylaws.

Given the controversy over ICANN’s independence, all eyes will be on the ICANN board to see if it is focused on doing the right thing. It’s time for the ICANN board to show resolve and to demonstrate that it is a strong, independent body acting according to the letter and spirit of its own AGB and bylaws and, perhaps most importantly of all, to actively demonstrate its commitment to act independently and in the global public interest.

Speaking at the first of ICANN’s two public forum sessions at ICANN 57 in Hyderabad, India this week, Robinson echoed that call, telling the ICANN board:

You are a credible, independent-minded, and respected board who recognized the enhanced scrutiny that goes with the post-transition environment. Indeed, this may well be the first test of your resolve in this new environment. You have the opportunity to deal with the situation by firmly applying your own rules and your own ICANN bylaw-enshrined core value to introduce and promote competition in domain names. We strongly urge you to do so.

Then, after a few months of relative quiet on the subject, Verisign and NDC this week came out swinging.

First, in a joint blog post, the companies rubbished Afilias’ attempt to bring the IANA transition into the debate. They wrote:

Afilias does a great disservice to ICANN and the entire Internet community by attempting to make this issue a referendum on ICANN by entitling its post “ICANN’s First Test of Accountability.” Afilias frames its test for ICANN’s new role as an “independent manager of the Internet’s addressing system,” by asserting that ICANN can only pass this test if it disqualifies NDC and bars Verisign from acquiring rights to the .web new gTLD. In this case, Afilias’ position is based on nothing more than deflection, smoke and cynical self-interest.

Speaking at the public forum in Hyderabad on Wednesday, Verisign senior VP Pat Kane said:

This is not a test for the board. This issue is not a test for the newly empowered community. It is a test of our ability to utilize the processes and the tools that we’ve developed over the past 20 years for dispute resolution.

Verisign instead claims that Afilias’ real motivation could be to force .web to a private auction, where it can be assured an eight-figure payday for losing.

NDC/Verisign won .web at a so-called “last resort” auction, overseen by ICANN, in which the funds raised go into a pool to be used for some yet-to-be-determined public benefit cause.

That robbed rival applicants, including Afilias, of the equal share of the proceeds they would have received had the contention set been settled via the usual private auction process.

But Verisign/NDC, in their post, claim Afilias wants to force .web back to private auction.

Afilias’ allegations of Applicant Guidebook violations by NDC are nothing more than a pretext to conduct a “private” instead of a “public” auction, or to eliminate a competitor for the .web new gTLD and capture it for less than the market price.

Verisign says that NDC was under no obligation to notify ICANN of a change of ownership or control because no change of ownership or control has occurred.

It says the two companies have an “arms-length contract” which saw Verisign pay for the auction and NDC commit to ask ICANN to transfer its .web Registry Agreement to Verisign.

It’s not unlike the deal Donuts had with Rightside, covering over a hundred gTLD applications, Verisign says.

The contract between NDC and Verisign did not assign to Verisign any rights in NDC’s application, nor did Verisign take any ownership or management interest in NDC (let alone control of it). NDC has always been and always will be the owner of its application

Not content with defending itself from allegations of wrongdoing, Verisign/NDC goes on to claim that it is instead Afilias that broke ICANN rules and therefore should have disqualified from the auction.

They allege that Afilias offered NDC a guarantee of a cash payout if it chose to go to private auction instead, and that it attempted to coerce NDC to go to private auction on July 22, which was during a “blackout period” during which bidders were forbidden from discussing bidding strategies.

During the public forum sessions at ICANN 57, ICANN directors refused to comment on statements from either side of the debate.

That’s likely because it’s a matter currently before the courts.

Fellow .web loser Donuts has already sued ICANN in California, claiming the organization failed to adequately investigate rumors that Verisign had taken over NDC.

Donuts failed to secure a restraining order preventing the .web auction from happening, but the lawsuit continues. Most recently, ICANN filed a motion attempting to have the case thrown out.

In my opinion, arguments being spouted by Verisign and Afilias both stretch credulity.

Afilias has yet to present any smoking gun showing Verisign or NDC broke the rules. Likewise, Verisign’s claim that Afilias wants to enrich itself by losing a private auction appear to be unsupported by any evidence.

Watch: Hollywood actors trash Trump, promote .vote

Kevin Murphy, September 22, 2016, Domain Registries

Robert Downey Jr, Scarlett Johansson, James Franco, that bloke who plays the Hulk, and a “shit-ton of famous people” are starring in a new anti-Trump attack viral that promotes a .vote domain name.

The video, put together by cult director Joss Whedon, gently spoofs quick-cut celebrity-ensemble appeals, while making a serious point about US presidential candidate Donald Trump being a threat to domestic race relations and global security.

It directs viewers to SaveTheDay.vote, where they are encouraged to register to vote in the November 8 poll.

Here it is:

It’s probably the highest-profile “in the wild” spotting of a .vote domain to date.

While I doubt it will work magic on .vote registration volumes, it’s certainly no bad thing for the visibility of new gTLDs in general.

At time of writing, the video had received about 1.2 million views on YouTube, less than 24 hours after its release.

.vote is an Afilias gTLD with post-registration usage restrictions. It currently has about 1,800 names in its zone file but only one domain in the Alexa one million most-visited sites.

Could ICANN reject Verisign’s $135m .web bid?

Kevin Murphy, September 21, 2016, Domain Registries

ICANN is looking into demands for it to throw out Verisign’s covert $135 million winning bid for the highly prized .web gTLD.

ICANN last week told the judge hearing Donuts’ .web-related lawsuit that it is “currently in the process of investigating certain of the issues raised” by Donuts through its “internal accountability mechanisms”.

Donuts is suing for $22.5 million, claiming ICANN should have forced Nu Dot Co to disclose that its .web bid was being secretly bankrolled by Verisign and alleging that the .com heavyweight used NDC as cover to avoid regulatory scrutiny.

ICANN’s latest filing (pdf), made jointly with Donuts, asked for an extension to October 26 of ICANN’s deadline to file a response to Donuts’ complaint.

It was granted, the second time the deadline has been extended, but the judge warned it was also the final time.

The referenced “internal accountability mechanism” would seem to mean the Cooperative Engagement Process — a low-formality bilateral negotiation — that Donuts and fellow .web bidder Radix initiated against ICANN August 2.

The filing states that the “resolution of certain issues in controversy may be aided by allowing [ICANN] to complete its investigation of [Donuts’] allegations prior to the filing of its responsive pleading.”

In other words, Donuts is either hopeful that ICANN may be able to resolve some of its complaints in the next month, or it’s not particularly impatient about the case progressing.

Meanwhile, fellow .web applicant Afilias has demanded for the second time that ICANN hand over .web to it, as the second-highest bidder, throwing out the NDC/Verisign application.

In a September 9 letter, published last night, Afilias told ICANN to “disqualify and reject” NDC’s application, alleging at least three breaches of ICANN rules.

Afilias says that by refusing to disclose Verisign’s support for its bid, NDC broke the rules and should have its application thrown out.

The company also confirmed on the public record for what I believe is the first time that it was the second-highest bidder in the July 27 auction.

Afilias would pay somewhere between $57.5 million and $71.9 million for the gTLD, depending on what the high bid of the third-placed applicant was.

In its new letter, Afilias says NDC broke the rule from the Applicant Guidebook that does not allow applicants to “resell, assign or transfer any of applicant’s rights or obligations in connection with the application”.

It also says that NDC was obliged by the AGB to notify ICANN of “changes in financial position and changes in ownership or control”, which it did not.

It finally says that Verisign used NDC as a front during the auction, in violation of auction rules.

“In these circumstances, we submit that ICANN should disqualify NDC’s bid and offer to accept the application of Afilias, which placed the second highest exit bid,” Afilias general counsel Scott Hemphill wrote (pdf).

Hemphill told ICANN to defer from signing a Registry Agreement with NDC or Verisign, strongly implying that Afilias intends to invoke ICANN accountability mechanisms (presumably meaning the Request for Reconsideration process and/or Independent Review Process).

While Afilias and Donuts are both taking issue with the secretive nature of Verisign’s acquisition of .web, they’re not necessarily fighting the same corner.

Donuts is looking for $22.5 million because that’s roughly what it would have received if the .web contention set had been resolved via private auction and $135 million had been the winning bid.

But Afilias wants the ICANN auction outcome to stand, albeit with NDC’s top bid rejected. That would mean Donuts, Radix, and the other applicants would still receive nothing.

There’s also the question of other new gTLD applications that have prevailed at auction and been immediately transferred to third-party non-applicants.

The most notable example of this was .blog, which was won by shell company Primer Nivel with secretive backing from WordPress maker Automattic.

Donuts itself regularly wins gTLD auctions and immediately transfers its contracts to Rightside under a pre-existing agreement.

In both of those cases, the reassignment deals predated, but were not disclosed in, the respective applications.

There’s the recipe here for a messy, protracted bun fight over .web, which should come as no surprise to anyone.

Afilias set to get .hotel despite hacking claims

Kevin Murphy, August 19, 2016, Domain Registries

Afilias is back on the path to becoming the registry for .hotel, after ICANN decided claims of hacking by a former employee of the applicant did not warrant a rejection.

The ICANN board of directors decided last week that HOTEL Top-Level Domain Sarl, which was recently taken over by Afilias, did not gain any benefit when employee Dirk Krischenowski accessed competing applicants’ confidential documents via an ICANN web site.

Because HTLD had won a Community Priority Evaluation, it should now proceed to contracting, barring any further action from the other six applicants.

ICANN’s board said in its August 9 decision:

ICANN has not uncovered any evidence that: (i) the information Mr. Krischenowski may have obtained as a result of the portal issue was used to support HTLD’s application for .HOTEL; or (ii) any information obtained by Mr. Krischenowski enabled HTLD’s application to prevail in CPE.

It authorized ICANN staff to carry on processing the HTLD application.

The other applicants — Travel Reservations, Famous Four Media, Radix, Minds + Machines, Donuts and Fegistry — had called on ICANN in April to throw out the application, saying that to decline to do so would amount to “acquiescence in criminal acts”.

That’s because an ICANN investigation had discovered that Dirk Krischenowski, who ran a company with an almost 50% stake in HTLD, had downloaded hundreds of confidential documents belonging to competitors.

He did so via ICANN’s new gTLD applicants’ portal, which had been misconfigured to enable anyone to view any attachment from any application.

Krischenowski has consistently denied any wrongdoing, telling DI a few months ago that he simply used the tool that ICANN made available with the understanding that it was working as intended.

ICANN has now decided that because the unauthorized access incidents took place after HTLD had already submitted its CPE application, it could not have gained any benefit from whatever data Krischenowski managed to pull.

The board reasoned:

his searches relating to the .HOTEL Claimants did not occur until 27 March, 29 March and 11 April 2014. Therefore, even assuming that Mr. Krischenowski did obtain confidential information belonging to the .HOTEL Claimants, this would not have had any impact on the CPE process for HTLD’s .HOTEL application. Specifically, whether HTLD’s application met the CPE criteria was based upon the application as submitted in May 2012, or when the last documents amending the application were uploaded by HTLD on 30 August 2013 – all of which occurred before Mr. Krischenowski or his associates accessed any confidential information, which occurred from March 2014 through October 2014. In addition, there is no evidence, or claim by the .HOTEL Claimants, that the CPE Panel had any interaction at all with Mr. Krischenowski or HTLD during the CPE process, which began on 19 February 2014.

The HTLD/Afilias .hotel application is currently still listed on ICANN’s web site as “On Hold” while its rivals are still classified as “Will Not Proceed”.

It might be worth noting here — to people who say ICANN always tries to force contention sets to auction so it possibly makes a bit of cash — that this is an instance of it not doing so.

Afilias buys three gTLDs from Starting Dot

Kevin Murphy, August 9, 2016, Domain Registries

Registry upstart StartingDot has sold its small portfolio of new gTLDs to Afilias.

.archi, .bio and .ski are the three components of the package.

While the size of the deal was not disclosed, retail prices and zone file volumes suggest the portfolio probably brings in about $2 million a year in revenue.

The biggest seller of the three is .bio, which was originally intended for farmers but its basically unrestricted and has a variety of use cases.

Given the high ticket price — around $90 a year retail — .bio has a surprisingly impressive 14,000 names under management.

.archi and .ski have fared less well, with 3,500 and 6,200 names in their respective zones. Both have premium fees — retailing at about $100 and $60 a year respectively.

Due to the high prices, Afilias gets to call these TLDs “premium”.

.archi is the only one of the three to have registration restrictions — you need to be an architect to get one.

Both .archi and .bio have been available to buy for a couple of years, while .ski’s first renewal cycle is about a month away.

All three sell predominantly through European registrars. Starting Dot is itself based in Paris and Dublin.

The deal seem to have been struck due to Afilias’ we-buy-any-TLD offer, which executives discussed with us a year ago.

Afilias said that StartingDot execs Godefroy Jordan and Stephane Van Gelder will continue to be employed for a transition period.

Contract breach cited as TLD Registry switches from Afilias to Chinese government back-end

The break between TLD Registry and former back-end provider Afilias may be even less amicable than first thought.

I’m hearing that TLDR served Afilias with a “Notice of Material Breach” of contract earlier this year, threatening to move its two gTLDs to a rival owned by the Chinese government.

There may even be pending litigation.

Today TLDR confirmed in a statement that it’s switching the roughly 30,000 names in .在线 (.xn--3ds443g, “Chinese online”) and .中文网 (.xn--fiq228c5hs, “Chinese website”) from Afilias to Beijing Teleinfo Network Technology Co.

Tele-info is a little-known back-end provider currently servicing four pre-launch Latin-script Chinese gTLDs.

According to TLDR, the company is owned by the Chinese Academy of Telecommunication Research, which appears to be part of the Chinese government’s Ministry of Industry and Information Technology.

According to a source, back in February TLDR told Afilias that it would switch to Tele-info if Afilias was “unable or unwilling to remedy” unspecified contractual breaches by mid-May.

I don’t know what the alleged breaches were and neither company wants to talk about it.

“Afilias does not comment on pending litigation,” a spokesperson said.

“We are not commenting on contractual or litigation matters,” a TLDR spokesperson said.

TLDR said in a statement that the switch to Tele-info will help it get a Chinese government license, so Chinese registrants will be able to start using their domains. CEO Arto Isokoski said:

The completion of this milestone will hopefully pave the way for our accreditation with Chinese regulators, which ultimately allows our China-based customer’s names to resolve legally to a website hosted from within China.

It’s hard to argue with that logic — if it’s using a government back-end for its SRS, one can see how that would oil the gears of bureaucracy.

UPDATE 1753 UTC: Afilias has just provided DI with the following statement:

With respect to TLD Registry’s charges of breach of contract, Afilias categorically denies any breach of any kind whatsoever. Afilias has complied completely with our contractual obligations and responded to all requests for assistance with their various business priorities. Since we began supporting these 2 TLDs, Afilias has met every SLA and enabled the 2 TLDS to be 100% compliant with their technical and contractual obligations to ICANN. Afilias has provided 100% compliance on every SRS requirement, and maintained their DNS with 100% availability throughout the entire period of our stewardship. TLD Registry’s charges are completely without merit.