M+M gets into bed with Neustar

Minds + Machines has committed to use Neustar’s registry services for some of its new top-level domain applications, the companies have announced.
M+M parent Top Level Domain Holdings said in a press release that the companies:

will work together exclusively in respect of all geographic gTLDs pursued by TLDH, apart from a short list of those already in progress. TLDH will oversee sales, marketing, registrar relations, ICANN compliance and other management functions, while Neustar will provide back-end registry and DNS services.

The deal may cover applications including .bayern, .berlin, and .mumbai, judging from the press release.
M+M will continue to use Espresso, its version of the CoCCA registry platform, for non-geo TLDs.
Under ICANN rules, geographical TLDs will require the support of the respective governments.
Reading between the lines, it appears that demand for proven scale and financial stability may have been the primary driver for the deal.
Neustar manages .us and biz, among others, while M+M has a far shorter track record. Neustar has annual revenue of over half a billion dollars, compared to TLDH’s approximately $100,000.

ICANN independence request denied

ICANN’s request for greater independence has been rejected by the National Telecommunications and Information Administration.
In its new Further Notice Of Inquiry (pdf) investigation into the IANA contract, through which ICANN is granted its internet management responsibilities, the NTIA said:

NTIA reiterates that it is not in discussions with ICANN to transition the IANA functions nor does the agency intend to undertake such discussions.

Transitioning the IANA functions would have meant less power over the domain name system for the US government and more for ICANN.
Privatizing the DNS was one of the original goals when ICANN was set up in 1998 — it was meant to happen before Clinton left office — but the US government has been dead set against such a move since at least 2005.
The latest decision was expected. NTIA assistant secretary Lawrence Strickling had flagged up the agency’s position in a recent speech.
Nevertheless, it’s a blow to ICANN and its CEO, Rod Beckstrom, who since the San Francisco meeting in March has been pushing for the IANA contract to be re-framed into a longer-term “cooperative agreement” to better reflect ICANN’s international nature.
But the NTIA said this would not be possible:

NTIA does not have the legal authority to enter into a cooperative agreement with any organization, including ICANN, for the performance of the IANA functions.

To drive the point home, the FNOI also calls for the functional aspect of IANA – the updates it makes to the DNS root database – to be clearly separated from the policy-making side of ICANN.
On the bright side, ICANN can rest assured that the NTIA seems to have put aside thoughts of breaking up the IANA functions and distributing them between different entities.
This notion was put to bed primarily because the organizations most likely to take over roles such as protocol and IP number administration (such as the NRO and the IAB) did not seem to want them.
The FNOI also suggests a raft of process and technology requirements that ICANN’s IANA team will have to abide by after the contract is renewed.
The process for redelegating ccTLDs is currently an absolute bloody mess – utterly opaque and with no historical consistency with how decisions for transferring ownership of TLDs are made.
The ccNSO is working on this problem, but its policy development is likely to take a year or two.
In the meantime, the NTIA will mandate through the IANA contract at least one major nod to ccTLD redelegation reform, in the form of the “respect rule” I blogged about earlier.
Under the heading “Responsibility and Respect for Stakeholders”, the proposed IANA Statement of Work says: “the Contractor shall act in accordance with the relevant national laws of the jurisdiction which the TLD registry serves.”
This provision is already included in most of the agreements ICANN has signed with ccTLD registries and ICP-1, the policy that governs its redelegation processes.

US resurrects the controversial new TLDs veto

The US government intends to give itself greater oversight powers over ICANN’s new top-level domains program, according to a partial draft of the next IANA contract.
The National Telecommunications and Information Administration has proposed what amounts to a Governmental Advisory Committee veto over controversial new TLDs.
The agency last night published a Further Notice Of Inquiry (pdf), which includes a proposed Statement Of Work that would form part of ICANN’s next IANA contract.
The IANA contract, which is up for renewal September 30, gives ICANN many of its key powers over the domain name system’s root database.
The new documents seem to fulfill NTIA assistant secretary Lawrence Strickling’s promise to use the IANA contract “as a vehicle for ensuring more accountability and transparency” at ICANN.
If the new draft provisions are finalized, ICANN would be contractually obliged to hold new gTLD applicants to a higher standard than currently envisaged by the Applicant Guidebook.
The FNOI notes that the US believes (my emphasis):

there is a need to address how all stakeholders, including governments collectively, can operate within the paradigm of a multi-stakeholder environment and be satisfied that their interests are being adequately addressed

The Statement Of Work, under the heading “Responsibility and Respect for Stakeholders” includes new text that addresses this perceived need:

For delegation requests for new generic TLDS (gTLDs), the Contractor [ICANN] shall include documentation to demonstrate how the proposed string has received consensus support from relevant stakeholders and is supported by the global public interest.

The current Applicant Guidebook does not require “consensus support from relevant stakeholders” before a new gTLD is approved.
It gives applicants the opportunity to show support from self-defined communities, and it gives communities the right to object to any application, but it does not require consensus.
Earlier this year, the GAC asked ICANN to beef up the Guidebook to make community support or non-objection a proactive requirement for applicants, but ICANN declined to make the change.
The .xxx Factor
The NTIA’s proposed “respect rule” alludes to the approval of .xxx, which the US and other governments believe was both not in the global public interest and unsupported by the porn industry.
Had the rule been applicable in March, ICANN could very well have found itself in breach of the IANA contract, and the NTIA could have been within its rights to block the TLD.
One way to look at this is as a US government safeguard against ICANN’s board of directors overruling GAC objections to new TLDs in future.
The Guidebook currently gives the GAC the right to object to any application for any reason, such as if it believed a proposed string was not supported by a community it purported to represent.
But the Guidebook, reflecting ICANN’s bylaws, also gives ICANN the ability to disagree with GAC advice (including its new TLD objections) and essentially overrule it.
Under the NTIA’s proposed IANA contract language, if ICANN were to overrule a GAC objection to a controversial application, the NTIA would be able to claim that the gTLD was approved without stakeholder consensus, in violation of the IANA contract.
The new gTLD program would have, in essence, a backdoor GAC veto.
While these changes are being made unilaterally by the US, they are certain to be supported by the European Commission and probably other members of the GAC.
Commissioner Neelie Kroes urged Secretary of Commerce Gary Locke to block or delay .xxx back in April, and subsequently met with Strickling to discuss their mutual opposition to the TLD.
Kroes and Strickling seem to agree agree that ICANN should not have signed the .xxx registry contract over the (weak, non-consensus) objection of the GAC.
The FNOI will shortly open for 45 days of public comment, so we’re not likely to know precisely how this is going to play out in the new IANA contract until August.
ICANN is now in the tricky position of trying to figure out how to incorporate this mess into the Guidebook, which it has indicated it plans to approve just over a week from now.
Singapore is going to be very interesting indeed.

Second .music applicant is Demand Media partner

Far Further has come out as the second company to say it plans to apply to ICANN for the .music top-level domain.
It’s also, I believe, the first applicant to reveal that it has partnered with Demand Media registrar eNom for its back-end registry services.
Far Further is one of a number of likely applicants for .music. The only other applicant to go public to date is Constantine Roussos’ dotMusic.
The new company is headed by former Warner Music record producer Loren Balman, CEO, and former music journalist John Styll, president. Former PIR chief Alexa Raad of Architelos is advising.
Far Further says its .music will “provide the global music community a secure identifying Internet address that supports the promotion of music, the protection of intellectual property rights, and the advancement of global access to music education.”
It’s my belief that the successful .music applicant will be the one that can secure the support of organizations such as the Recording Industry Association of America and its overseas counterparts.
The RIAA’s concerns about piracy spreading through .music domains, however misplaced, suggest that any other applicant is likely to find itself on the receiving end of objections, if not lawsuits.
Support from such organizations would also be critical to any bid that plans to invoke a Community Priority Evaluation — a trump card that well-supported applications can play in the ICANN process.
Perhaps the most interesting revelation about Far Further is the company’s selection of eNom, and its Shared Registry System, as its back-end technology services provider.
eNom is of course the world’s second-largest domain name registrar, with over 11 million domains under management, but it has yet to enter the registry services market.
There’s still a bit of a question mark over eNom’s ability to pass ICANN’s background checks, due to its UDRP losses, but this may not be a problem if it is merely the back-end provider, rather than the applicant itself.

ICANN hiring CSRs for new TLD program

ICANN has advertised for four new staff to support its new generic top-level domains program.
The organization is looking for three Lead Application Coordinators, to be based in Marina Del Rey, Hong Kong and Brussels, and one Application Coordinator for Marina Del Rey.
The roles are all fairly similar – essentially senior customer support representatives for new gTLD applicants. The lead positions require more than five years call center experience and a university degree.
With the number of applicants in the first round expected to be around the 400 mark, I think that’s a pretty solid ratio of CSRs to applicants, assuming the application process runs smoothly.
The hiring move is obviously a pretty strong indication that ICANN expects the new gTLD program to kick off fairly soon.
ICANN has also recently started advertising for a vice president of Europe, which I believe is a new position. It currently has 18 open positions in total, according to its hiring page.

Senior ICANN staffer hired by .bank project

Craig Schwartz, ICANN’s chief gTLD registry liaison, has been headhunted by BITS, the tech arm of the Financial Services Roundtable, to head up its .bank top-level domain application.
Schwartz will become BITS’ general manager of registry programs in early July, following the conclusion of the next ICANN meeting in Singapore.
BITS has yet to reveal the TLDs it plans to apply for, but .bank is the no-brainer. I understand it is also considering complementary strings, such as .finance and .insurance
The organization has already said that it plans to use VeriSign as its back-end registry services provider.
Schwartz is a five-year ICANN veteran, and his experience dealing with registries will no doubt be missed, particularly at a time when the number of gTLDs is set to expand dramatically.
His replacement will have plenty of time to settle into the role, however. The first new gTLDs approved under the program are not likely to go live until late 2012 at the earliest.

ICANN tries to limit rogue registrars

As part of its growing efforts to clean up the domain name registrar market, ICANN has introduced background checks for companies applying for accreditation.
ICANN will check criminal and financial records, as well as doing credit checks, on companies that want to be able to sell domains in gTLDs.
As a result, the cost of applying to become a registrar is going up by $1,000, to $3,500, to cover the cost of accessing the relevant third-party databases.
The changes, made largely at the behest of law enforcement participants in ICANN, concerned that some registrars are not what you’d call responsible netizens, come into effect July 1.
The intellectual property lobby had called for the checks to include cybersquatting and UDRP judgements, but those suggestions were not taken on board.

How the GAC could derail new TLDs in Singapore

The pieces are moving into place for what could be the final battle over new top-level domains between ICANN and its Governmental Advisory Committee, in Singapore later this month.
ICANN made few concessions to the GAC’s biggest concerns in the latest Applicant Guidebook, which begs the question of whether the United States will now be asked to play its trump card.
Earlier this week, European Commissioner Neelie Kroes made threatening noises in ICANN’s direction, saying that by approving the controversial .xxx domain over GAC advice, ICANN had showed that it cannot be trusted with new top-level domains.

If the ICANN board chooses to move forward [with .xxx] despite significant governmental concerns, what does this tell us for the next meeting in Singapore, which is widely expected to launch the next batch of TLDs? The concerns of governments in this process are not trivial, ranking from trademark protection to cooperation with law enforcement

The current Guidebook has not accepted (with some good reasons) many of the GAC’s requests on the issues of trademark protection and the governmental right to object to new TLD applications.
In a recorded address at the EuroDIG conference in Serbia this week, before the Guidebook was published, Kroes called for ICANN’s multistakeholder internet governance model to be “amended to better take into account the voice of governments”.
She said she is supported by colleagues in the EU and overseas, presumably referring to Lawrence Strickling, head of the NTIA, with whom she met last month to discuss .xxx and new TLDs.
In her speech, Kroes called for the United States to leverage its unique position of authority over ICANN to influence change at the organization:

The expiry of the IANA contract in September will be a unique opportunity to sharply focus on a set of minimum requirements for whichever organization will be designated to carry out the future IANA functions. Specifically, I feel that the new contract should include specific provisions to improve standards of corporate governance in the organization in charge.
…whichever will be the organization resp for naming and addressing resources, it should be required to demonstrate it has support of global internet community before it makes proposals to add any further top-level domains to the internet.

This is perhaps the most explicit outside call yet for the US to use the IANA contract both to get the GAC a louder voice at the ICANN table and to have the demands of the trademark lobby taken fully into account in the new TLDs program.
The US Trump Card
It’s no secret that the US has an ace up its sleeve, in the form of the soon-to-expire IANA contract.
IANA is responsible for the paperwork when updates are to be made to the DNS root, whether they are redelegating a ccTLD, changing name servers, or adding an entirely new TLD.
When a new TLD is approved, ICANN’s IANA department forwards the request to the NTIA, which reviews it before instructing VeriSign to add the TLD to the A-root.
IANA is currently a no-fee contract between the NTIA and ICANN. Theoretically, the NTIA could award the contract to whichever organization it chooses, after it expires.
This is unlikely to happen. But if it did, ICANN’s powers would be severely curtailed – another entity would be above it in the root’s chain of command.
Alternatively, the NTIA could amend the contract to impose conditions on ICANN, such as making it more accountable to the GAC. This is what Kroes appears to be pushing for.
Strickling himself said a month ago that he has not ruled out the option of using the IANA contract as “as a vehicle for ensuring more accountability and transparency” at ICANN.
There is another theory, however, which is currently doing the rounds.
As it currently stands, if ICANN approves the Applicant Guidebook in Singapore on June 20, the expected timetable has it accepting new gTLD applications as early as November.
By that time it would, presumably, have already renewed the IANA deal, and would still have its nominal powers to add new TLDs to the root.
But buried deep within the IANA contract (pdf) is a provision that allows the NTIA to unilaterally extend its term by six months – from September 30, 2011 to March 31, 2012.
If the NTIA were to exercise this option, it could put a serious question mark over ICANN’s ability to start accepting new TLD applications this year.
With no guarantee that its authority to add new TLDs to the root would be renewed, would risk-averse ICANN be happy to go ahead and accept tens of millions of dollars in application fees?
It seems unlikely.
I’ve little doubt that this scenario will have been discussed by the NTIA and its allies. It would look better politically for the US if it had the support of the GAC before making such a play.
Since the GAC seems to want to buy time for further talks on new TLDs before ICANN kicks off the program, the IANA contract extension may appear to be a good way of going about it.
But with ICANN seemingly set to approve a Guidebook that will remain open to significant amendments post-Singapore, does the IANA threat need to be invoked at all?
If negotiations over trademark protection, developing world funding and GAC objections can remain open even after the Guidebook has been “approved”, perhaps there’s scope for a more peaceful resolution.

Clarity for .brands in new Guidebook

Companies planning to apply for a “.brand” top-level domain have had some of their concerns put to rest in the latest version of ICANN’s Applicant Guidebook.
Potential .brands were worried that ICANN might try to redelegate their trademarked TLDs to a third-party operator in the event that they decided to discontinue the domain.
They were also concerned that the Code of Conduct would require them to offer equitable access to all accredited registrars – a ridiculous situation for a single-registrant TLD.
Both of these problems seem to have been addressed in the new Guidebook, which enables registries to ignore the Code of Conduct and redelegation scenario if they can satisfy three criteria.
They have to show to ICANN’s satisfaction that “all domain name registrations in the TLD are registered to, and maintained by, Registry Operator for its own exclusive use”, that it does not sell to third parties, and that to redelegate the TLD or enforce the Code “is not necessary to protect the public interest”.
These changes make the .brand proposition a lot more realistic, less risky, and may put many concerns to rest.
They do stop short of requests from potential .brands such as Microsoft, which wanted a TLD operator’s express written consent to be required before a redelegation took place, however.

ICANN beefs up new TLD fraudster checks

ICANN has broadened the background checks in its new top-level domains program to ban companies with a history of consumer fraud from applying for a new gTLD.
The new check in the Applicant Guidebook reads as follows:

a final and legally binding decision obtained by a national law enforcement or consumer protection authority finding that the applicant was engaged in fraudulent and deceptive commercial practices as defined in the Organization for Economic Co-operation and Development (OECD) Guidelines for Protecting Consumers from Fraudulent and Deceptive Commercial Practices Across Borders may cause an application to be rejected. ICANN may also contact the applicant with additional questions based on information obtained in the background screening process.

The OECD guidelines, which define deceptive practices, were suggested by ICANN’s Governmental Advisory Committee as a way to keep out the fraudsters.
I speculated last week that implementation of such rules could capture Network Solutions and/or VeriSign, due to their dodgy dealings almost a decade ago.
But it appears that the two companies are safe – the wording is such that it likely does not apply to the settlement NetSol made with the Federal Trade Commission which, while legally binding, was explicitly not a “finding” of fact or law.
The Guidebook also now asks applicants to disclose if they have been “disciplined by any government or industry regulatory body for conduct involving dishonesty or misuse of funds of others”. The “industry regulatory body” text is a new insertion.