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ICANNWiki could be first victim of budget cutbacks

Kevin Murphy, December 20, 2017, Domain Policy

ICANN is mulling whether to cut funding to ICANNWiki, the independent community encyclopedia, as part of its efforts to rein in spending.

There’s $100,000 at stake, more than half of the Oregon-based non-profit’s annual budget.

Ray King, the gTLD registry CEO who founded ICANNWiki in 2005, told DI today that ICANN has been providing funding for the last three years.

“While no decision has been made yet, there is a possibility that ICANN will not continue it,” he said in an email.

“We’ve poured our hearts and minds into this project for many years so this would be disappointing to say the least,” he said. “We believe in our mission and that it is in the community’s interest for this support to continue”.

An ICANN spokesperson said: “At this time, while it is highly unlikely that ICANN will be renewing its contract with ICANNWiki, we have not come to a final determination.”

ICANNWiki currently carries about 6,000 volunteer-edited articles covering many aspects of the ICANN community and the domain name industry in general.

George Clooney circa 1997It’s perhaps most recognizable for the frequently shared caricatures of community members it produces, such as this handsome devil, and the playing card decks handed out as freebies at ICANN meetings.

According to a letter (pdf) sent to ICANN earlier this month, ICANNWiki receives cash contributions of $161,000 a year, $61,000 of which comes from 10 corporate sponsors.

ICANNWiki estimates the 2,200 hours per year of volunteer work it benefits from is worth about $66,500. It says it has in-kind contributions worth about $40,000 from other companies.

It puts the value of its “reference services” at $339,959 a year.

That’s based on estimated visits to its site of 182,774 in 2017 (not including visits from its editors and staff) and a value per visit of $1.86 (based on an unrelated ROI calculation Texas Public Libraries used to justify its own existence earlier this year).

The ICANN $100,000 contribution is at risk now due to the organization’s plan to cut back on spending in the face of revenues that are coming in lower than expected due to a weak domain name market.

CEO Goran Marby said yesterday that its fiscal 2018 is currently running a million dollars short. Coupled with a perceived need to add an extra $80 million to its reserve budget, ICANN is looking for areas to cut costs.

ICANNWiki funding may be the low-hanging fruit in this endeavor; while it’s no doubt valuable (I probably use it two or three times per week on average), it’s perhaps not straightforward to quantify that value.

Even if the funding is cut, I would not expect ICANNWiki the web site to disappear, given the level of corporate sponsorship and in-kind services it receives and the low overheads suggested by its modest traffic numbers, but perhaps its growth and outreach ambitions would be curtailed.

UPDATE: This post was updated at 2307 UTC with a quote from ICANN.

ICANN, with $143 million budget, running out of cash

Kevin Murphy, December 19, 2017, Domain Policy

ICANN is to tighten its belt over the coming year as lower than expected revenue from domain name registrations has caused a budget shortfall and dwindling reserves.

The organization is $1 million short so far in its fiscal 2018, which CEO Goran Marby says is forcing him to look at making cuts to staffing costs, travel expenses, and community-requested projects.

Meanwhile, chair Cherine Chalaby says the board of directors is worried that ICANN’s reserve fund is $80 million shy of where it ideally should be.

Both men outlined their priorities in separate end-of-year blog posts this week.

It does not yet appear that anyone’s job is on the line.

Marby indicated that headcount would be reduced through attrition — sometimes not replacing staff who leave — rather than lay-offs.

“The reality is, ICANN has a significant budget but not an infinite budget. We need to make some changes, and can’t do everything we are asked,” he wrote, before explaining some areas where “efficiencies” could be found.

For example, when someone leaves ICANN org, we are taking a close look at the vacancy, the team’s needs and other people’s availability and skills before deciding if we are going to fill the role. We are also looking at our staff travel practices for ICANN meetings and other ICANN org commitments, reviewing our language services support levels and offering, and trying to consolidate our collateral and the volume of reports. We are looking at what projects we could delay or stop

Some might say that this renewed focus on how ICANN manages its money is overdue. The organization has bloated fast over the last several years, as over 1,200 new gTLD registries became contracted parties and interest in ICANN’s work grew globally.

In its financial year ending June 2012, it budgeted for revenue of $69.7 million and expenses of $67 million.

For FY2017, which ended this June, it was up to revenue of $132.4 million and expenses of $126.5 million.

Over the same period, headcount swelled from 158 full-time equivalents to 365. That was anticipated to grow to 413 by next June.

For the financial year ending next June, ICANN had budgeted for $142.8 million revenue, growing from $135.9 million, but Marby said in his blog post today that it might actually be flat instead.

As much as 64% of ICANN’s revenue is driven by transaction volumes — registrations, renewals and transfers — in gTLDs. In the quarter to September, revenue was $1 million behind plan due to lower than expected transactions, Marby said.

The message is to expect cuts, possibly to projects you care about.

Adding complexity, the ICANN board has decided following public consultation at 12 months funding is the appropriate amount ICANN should be keeping in reserve — so it can continue to function for a year should its contracted parties all abruptly decide not to pay their dues.

Unfortunately, as Chalaby outlined in his post today, this reserve pool is currently at about $60 million — just five months’ worth — so the organization is going to have to figure out how to replenish it.

Building up reserves to the tune of an extra $80 million is likely to put more pressure on the regular annual budget, leeching cash from other projects.

Chalaby said that the board will discuss its options at its February 2018 workshop.

Marby, meanwhile, said that a new budget will be out for public comment in mid-January.

New Trump appointee slams ICANN after security group shutdown

Kevin Murphy, December 19, 2017, Domain Policy

Not even a month into the job, the US official with most direct responsibility over domain name policy has criticized ICANN for shutting down a security working group.

David Redl, the new assistant secretary at the National Telecommunications and Information Administration, wrote to ICANN (pdf) last week to complain about its board unilaterally shutting down, temporarily, its supposedly independent Security, Stability and Resiliency of the DNS Review team.

He wrote that the action “calls into question” ICANN’s commitment to transparency and accountability, writing:

Everything documented to date about these reviews stresses the importance of openness, transparency and community consultation. Unfortunately, it seems that with the October 28th action, the ICANN Board violated these principles by substituting its judgement for that of the community.

SSR-2, as it is known, is one of the reviews previously mandated by ICANN’s Affirmation of Commitments with the US government (via the NTIA) but which can now be found instead embedded in its bylaws.

The ICANN board of directors temporarily suspended it in October, something like a soft reboot, after growing concerned that it was stepping outside of its mandate and that its members lacked expertise.

The move attracted broad criticism and it would be disingenuous of me to suggest that Redl’s position is a controversial one — you’d be hard pressed to find any section of the community that wholeheartedly supports the board’s action.

Indeed, the US representative to the Governmental Advisory Committee voiced similar concerns at the ICANN meeting in Abu Dhabi in late October, prior to Redl’s confirmation to the NTIA job.

Redl took the post November 21, having been nominated by Donald Trump back in May, replacing Obama appointee Larry Strickling, who left the agency in January.

He’s the first NTIA chief since ICANN’s inception not to enjoy the special position of power over ICANN granted by the old IANA contract, which was scrapped in September 2016.

Second delay for domain security key rollover

Kevin Murphy, December 18, 2017, Domain Tech

ICANN has decided to delay changing the security keys to the DNS for the second time.

The “KSK Rollover” had been rescheduled from October 11 to some time in the first quarter 2018, but that will no longer happen. We’re now looking at Q3 at the earliest.

“We have decided that we do not yet have enough information to set a specific date for the rollover,” VP of research Matt Larson said in a blog post. “We want to make clear, however, that the ICANN org is committed to rolling the root zone KSK”.

The root KSK, or Key Signing Key, is the cryptographic key pair at the very top of the security hierarchy specified by DNSSEC, the security extension for DNS.

The current, first-ever, root KSK has been in operation since 2010, but ICANN’s policy is to roll it every five years or so.

The October date was delayed after newly available data showed that hundreds of DNS resolvers were still only configured to use the 2010 keys and not the 2017 keys that have already been deployed in tandem.

This would mean a rollover would cut off access to DNSSEC-signed zones to potentially millions of internet users.

ICANN found that 4% of the 12,000 DNSSEC-validating resolvers — roughly 500 IP addresses — it surveyed in September were not ready for KSK-2017.

Larson told us last month that at least 176 organizations in 41 countries were affected.

Since the first delay, ICANN has been trying to contact the owners of the 500 incompatible IP addresses but has run into some serious problems, Larson blogged.

First, a significant number of these addresses are dynamically allocated (such as to home broadband hubs) meaning tracking down the owners of the misconfigured devices would be next to impossible. Others were forwarding DNS queries on behalf of other devices, creating a similar problem.

Additionally, it seems ICANN has still not received responses from owners of 80% of the affected IP addresses.

Due to the lack of reliable data, it’s difficult for ICANN to figure out how many users’ internet access will be affected by a rollover.

The threshold called for by current policy is about 20 million people.

So ICANN has delayed the event to some point after Q1. Larson wrote that the organization will publish a plan on January 18 which will be open for public comment and discussed at the ICANN 61 meeting in Puerto Rico next March.

A final plan is not expected until ICANN 62, which happens in late June, so Q3 would be the earliest the rollover could actually occur.

Larson encouraged anyone interested in discussing the plan to join this mailing list.

Justice gives nod to O.com auction

Kevin Murphy, December 18, 2017, Domain Registries

The US Department of Justice does not intend to prevent Verisign from auctioning off the single-letter domain o.com.

Aaron Hoag, chief of the department’s Technology & Financial Services Section, told ICANN in a letter (pdf) that it does not intend to probe Verisign’s proposal.

The letter reads in its entirety:

Your letter dated December 7, 2017, to Makan Delrahim, Assistant Attorney General of the Antitrust Division, regarding VeriSign’s proposal to auction O.COM, has been referred to the Technology & Financial Services Section for review. After careful consideration of the matter, the Division can report that it does not intend to open an investigation into the proposed auction described in the attachment to your letter.

Verisign asked ICANN’s permission to auction o.com, with most of the the proceeds going to good causes, after over a decade of nagging from retailer Overstock.com, which desperately wants to own the currently reserved name.

It would set a precedent for the company to sell off the remaining 22 single-letter domains, not to mention the 10 digits, which are all currently reserved due to a decades-old technical policy no longer considered necessary.

Verisign would only receive its $7.85 base registry fee from the sale, despite the fact that single-letter domains could easily fetch seven or eight figures.

The company asked ICANN for permission to release the name via its Registry Services Evaluation Process last month.

ICANN said earlier this month that it had no objection on technical grounds, but referred it to US competition authorities for a review.

With the DoJ apparently not interested, the door is open for ICANN to approve the RSEP before the end of the year, meaning Verisign could carry out the auction in 2018.

The big question now is whether anyone other than Overstock will want to take part in the auction. Overstock has US trademarks on “O.com”, despite the fact that it’s never actually owned the domain.