Afilias retains .org back-end deal

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

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

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?

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

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

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.

Afilias loses back-end deals on two Chinese gTLDs

TLD Registry, the Finnish/Irish registry that runs two Chinese-script gTLDs, has ditched Afilias in favor of a Chinese back-end provider.
Afilias said tonight that as of Friday it will no longer be the back-end for .在线 (.xn--3ds443g, “Chinese online”) and .中文网 (.xn--fiq228c5hs, “Chinese website”).
The company said:

Afilias has been directed by TLD Registry to shut down the Afilias operated SRS’s for .xn—3ds443g and .xn—fiq228c5hs on June 17, 2016 at 00:00:00 UTC and transfer the registry files to TLD Registry and its new provider. In accordance with this directive from our client, the SRS will be shut down and the files will be transferred, and Afilias will no longer operate the SRS for these two strings.

TLD Registry VP Pinky Brand declined to name the registry’s new back-end provider, beyond that the winning provider is Chinese.
The new back-end will be named in the next day or so, he said.
Registrars have been informed about the switch, Afilias said.
It’s not yet clear whether TLD Registry has decided to switch providers for cost reasons or in order to more deeply embed itself in China.
The company was founded by and is managed by Finns and is legally based in Ireland, but it only runs Chinese-script gTLDs.
The Chinese government has regulations, and is proposing more, preventing Chinese citizens using domains that do not meet certain guidelines, which include a corporate presence in China.
Several registries are opening up offices in China in order to abide by these rules, but I’m not aware of any that have switched back-ends for that reason.
The two gTLDs have fewer than 30,000 domains in their zone files between them.

Afilias takes over .hotel, sidelines Krischenowski over hacking claims

Afilias has sought to distance itself from DotBerlin CEO Dirk Krischenowski, due to ongoing claims that he improperly accessed secret data on rival .hotel applicants.
The company revealed in a recent letter to ICANN that it has bought out Krischenowski’s 48.8% stake in successful .hotel applicant Hotel Top Level Domain Sarl and that Afilias will become the sole shareholder of HTLD.
The move is linked to claims that Krischenowski exploited a glitch in ICANN’s new gTLD applicants’ portal to access confidential financial and technical information belonging to rival .hotel applicants.
These competing applicants have ganged up to demand that HTLD should lose its rights to .hotel, which it obtained by winning a controversial Community Priority Evaluation.
Afilias chairman Philipp Grabensee, now “sole managing director” of HTLD, wrote ICANN last month (pdf) to explain the nature of the HTLD’s relationship with Krischenowski and deny that HTLD had benefited from the alleged data compromise.
He said that, at the time of the incidents, Krischenowski was the 50% owner and managing director of a German company that in turn was a 48.8% owner of HTLD. He was also an HTLD consultant, though Grabensee played down that role.
He was responding to a March ICANN letter (pdf) which claimed that Krischenowski’s portal credentials were used at least eight times to access confidential data on .hotel bids. It said:

It appears that Mr Krischenowski accessed and downloaded, at minimum, the financial projections for Despegar’s applications for .HOTEL, .HOTEIS and .HOTELES, and the technical overview for Despegar’s applications for .HOTEIS and .HOTEL. Mr Krischenowski appears to have specifically searched for terms and question types related to financial or technical portions of the application.

Krischenowski has denied any wrongdoing and told DI last month that he simply used the portal assuming it was functioning as intended.
Grabensee said in his letter that any data Krischenowski may have obtained was not given to HTLD, and that his alleged actions were not done with HTLD’s knowledge or consent.
He added that obtaining the data would not have helped HTLD’s application anyway, given that the incident took place after HTLD had already submitted its application. HTLD did not substantially alter its application after the incident, he said.
HTLD’s rival .hotel applicants do not seem to have alleged that HTLD won the contention set due to the confidential data.
Rather, they’ve said via their lawyer that HTLD should be disqualified on the grounds that new gTLD program rules disqualify people who have been convicted of computer crime.
Even that’s a bit tenuous, however, given that Krischenowski has not been convicted of, or even charged with, a computer crime.
The other .hotel applicants are Travel Reservations, Famous Four Media, Radix, Minds + Machines, Donuts and Fegistry.
ICANN is now pressing HTLD for more specific information about Krischenowski’s relationship with HTLD at specific times over the last few years, in a letter (pdf) published last night, so it appears that its overdue investigation is not yet complete.

Afilias goes it alone with .green as DotGreen bows out

DotGreen Community has withdrawn from its partnership with Afilias, leaving the registry operating the .green gTLD solo.
The new management means that renewal prices for sunrise names will be slashed, and the size of the premium names list will be reduced.
DotGreen was originally a .green gTLD applicant, but it withdrew its application before the auction, which Afilias subsequently won.
It made a deal with Afilias to run sales and marketing for the domains, with Afilias handling all the technical stuff. The plan was to use profits to help environmental causes.
But Afilias told its registrars in an email this week:

Unfortunately, DotGreen Community has informed us that it is no longer able to discharge these responsibilities, and has turned the sales and marketing responsibilities back over to Afilias.

The gTLD has a new logo and a new website at get.green.
Afilias said it will no longer charge a extra $50 for renewals of sunrise period names.
It also plans to revise its premium names list by November, and will probably reduce the size of the list, releasing names at regular registry prices.
.green domains haven’t exactly been flying off the shelves with DotGreen running marketing.
It went into general availability in March last year but only has about 2,200 names in its zone file.