Kinderis calls on industry to cut the bullshit

Domain Name Association chair Adrian Kinderis has called for the industry to “grow up”.
The former ARI CEO, now Neustar veep, said Monday it’s time for the industry to kick out the handful of bad actors that ruin its reputation, and to quit the “bullshit bickering” about which TLDs are best.
“For far too long this industry has turned a blind eye to the less than scrupulous activities,” he said, “and these activities have plagued this industry. Bad actors have tarnished the perception of this industry.”
“This may have been acceptable when it was a few insiders first grasping at a fledgling product in the early nineties but… we are now front and center of the internet,” he said.
“These practices of a few bad actors have led to the frustration of consumers. We have not served the best interests of our consumers at all times,” he said. “This has to change.”
He was speaking to an audience of registries, registrars and investors at the opening session of the NamesCon conference in Las Vegas on Monday.
It was a fairly standard DNA sales pitch, the kind Kinderis has given before, but few could deny the truth of his remarks.
He called upon the industry to more effectively self-regulate, working with ICANN, to keep the boogeymen of government legislators and law enforcement agencies at bay.
“It’s time to grow up and show that we can regulates ourselves and build a strong sustainable industry with integrity,” he said.
He also called for unity among industry participants, pointing out that the threats to their businesses are external to the domain industry.
“The domain name war must be over,” he said. “The infighting and bullshit bickering has to stop. The .coms, the not-.coms, the IDNs, the g’s versus the cc’s… this must stop.”
“As an industry we have been very lucky. We’ve stumbled through 20 years without a collective strategy nor cohesion,” he said. “Outside forces have not had a massive impact on us, yet. QR codes have tried. Apps are trying.”
He pointed to the recent positive “bump” that many domain companies have experienced as a result of investment from China, but attributed to “dumb luck” rather than the result of any smart marketing or outreach.
The 10-minute speech can be viewed below or on the NamePros YouTube channel.

Neustar shoots the corpse of .kids.us

The ill-conceived, barely used .kids.us domain is to stay dead, Neustar confirmed last night.
The .us registry operator said that its Stakeholder Council met August 17 and:

carefully considered the report on the kids.us domain and unanimously recommended that the requirement be suspended for the life of the .us contract.

Neustar had been forced into making a call about reintroducing .kids.us by its current .us contract, which it signed in March 2014.
One October 2014 expert report and May 2015 comment period later, and the decision has been made to keep the idea suspended.
.kids.us was introduced via US legislation as a way to make politicians look like they were doing something create a friendly space for the under 13s.
But the zone wound up with reg numbers that make new gTLDs look popular, so the decision was made in 2012 to kill it off.
Neustar’s .us contract lasts another two to four years, and that’s how long the suspension will last, at least.

Direct .au regs closer to reality

Australians could soon get the ability to register domain names directly under .au for the first time.
Following in the footsteps of the UK and New Zealand, a panel of .au policy body auDA has recommended that the second level should be opened up for registrations, pending further consultation.
In a consultation paper (pdf), the panel wrote:

direct registrations would create names which are shorter, more appealing and more memorable. They would make the domain name system simpler and easier to use. Moreover, the proposed change would open a wide range of new choices for registrants, and would provide a better option, especially for some groups; in particular, the Panel thinks that the biggest benefit will be for individuals, who would be able to obtain an Australian domain name in a simple and straightforward way.

Trademark owners need to pay attention, because the panel has recommended that the release does not include a sunrise period, due to .au’s “no hierarchy of rights” principle.
But the panel is recommending that existing .au registrants should get first dibs on matching second-level names.
Unlike the UK, where .co.uk registrants had preference over registrants in other SLDs, the auDA panel says .com.au owners would not be treated any differently to, for example, .org.au owners.
The panel has also raised the idea of implementing ICANN’s Uniform Rapid Suspension policy.
Registry providers might want to take note that the panel says that .au back-end AusRegistry, now part of Neustar, will not automatically get the contract to run the direct .au registry; an RFP may be in auDA’s future.
The recommendations are now open for comment until September 30.

Neustar becomes “world’s largest registry” with $87m ARI buy

Consolidation in the domain name industry continued last night with Neustar’s $87 million acquisition of Bombora Technologies, the holding group for ARI Registry Services and AusRegistry.
Bombora CEO Adrian Kinderis told DI that the deal makes Neustar the “biggest registry services back-end provider on the market”, as measured by the number of TLDs on its platform, which now weighs in at over 400.
Kinderis and Neustar registry VP Sean Kaine said that the acquisition — conceived as so many deals are, Kinderis joked, in a “drunken ICANN bar” — is not so much about consolidation and more about growth opportunities.
Neustar will be able to cross-sell its suite of identity, security and marketing services, which Bombora does not offer, into ARI’s 100+ TLD client base. It will also be able to pitch ARI’s consulting services to its own clients.
Neustar also gets a “beachhead” in the Asia-Pacific region. While Bombora may not be a hell of a lot closer to Asia than Neustar, it’s in a much more convenient time zone.
Neustar currently faces the losing about half of its annual revenue — some $475 million — due to the loss of its contract to administer telephone number portability in North America.
That contract has been won by Ericsson, but Neustar has sued the US Federal Communications Commission in an attempt to keep it.
The Bombora acquisition won’t exactly fill the gap. The company had $20.6 million in revenue in 2014 and is expected to contribute $8 million to Neustar’s top line in 2015.
The deal is for AUD 118 million, which works out to roughly USD 87 million. Kinderis and business partner Simon Delzoppo will be the primary beneficiaries — between them they held a majority shareholding in Bombora.
The deal includes all of the company’s subsidiaries: ARI, AusRegistry and new gTLD operators such as dotShabaka.
ARI clients will notice a change of branding — the ARI and Bombora brands are to go almost immediately — but no technical changes at first.
“We’re going to continue to operate two registry systems right now,” Kaine said.
One business where there will be even less visible change is AusRegistry, which operates .au.
The AusRegistry brand is staying and .au will continue to be run in Australia, per the terms of the company’s contract with ccTLD policy overseer auDA.
“The .au contract is very important to Bombora,” Kinderis said. “If we had thought there would be any negative impact to that contract we would not have embarked on a deal.”
Kinderis, whose new job title has yet to be agreed, said he expects to take a “prominent role” in Neustar’s registry business. He said he expects to stay with the company “for a long time yet”.
“I want to see Neustar snapping at the heels of Verisign and I’d love to be able to contribute to that,” he said. “We’ve been punching above our weight and now we’re one of the heavyweights.”

US confirms Neustar to lose $475m-a-year contract

Neustar still seems set to lose a critical US government contract that provides half of its annual revenue.
The Federal Communications Commission voted unanimously last week to begin talks with rival contract bidder Telcordia, saying it will save the US consumer hundreds of millions of dollars a year.
Since 1997, Neustar has administered the telephone number portability system in the US. It’s not related to domain names.
Neustar, which also runs .us, .biz and .co, made $474.8 million from the deal in 2014, 49% of its annual revenue.
Commissioner Ajit Pai said in a statement:

Should we now declare Telcordia the next local number portability administrator? When you compare the numbers, the answer is clear. Last year, the current contract cost about $460 million. In contrast, Telcordia bid less than $1 billion for a seven-year term — that’s less than $143 million per year. That’s substantial savings for the American public.

Neustar told Bloomberg that the ruling was “procedurally defective” and that the company is “considering all options to address the significant flaws.”
Some kind of legal action to attempt to block the negotiations seems possible.
The company has also initiated a share buy-back to prop up its stock in light of the bad news.

Neustar set to lose contract that provides HALF its revenue

Neustar has been devastated by the news that it is likely to lose a US government contract that provides almost half of its annual revenue.
The US Federal Communications Commission yesterday recommended that Telcordia Technologies take over the Local Number Portability Administrator contract, which Neustar has held since 1997.
The service is basically North America’s centralized phone number registry. It’s not directly related to its domain name businesses.
In 2014, the deal was worth $474.8 million to Neustar, or 49% of its annual revenue.
On the news, the company’s share price fell off a cliff, losing almost 20% of its value before recovering slightly to end the day almost 12% down.
Neustar expressed dismay and anger in a press release, saying the FCC was putting the security of the US phone system at risk:

Although apparently the LNPA is used to port numbers, it is also critical for technology migrations, mergers and acquisitions, disaster recovery, accurate 911 location, and is the only authoritative database for the proper call completion of 11 billion voice calls and text messages each day. The recommendation misunderstands the operating system and would harm public safety, law enforcement, fundamentally burden small carriers, and disrupt service for 12 million consumers — all in pursuit of theoretical savings for a few carriers, which Neustar believes will be dwarfed by the costs and risks of transition.

Switching to Telcordia is currently only a recommendation that FCC commissioners must approve, and Neustar said it will “review all of its options”.
The LNPA deal is due to expire June 30 this year.
Neustar’s domain business — or “security services” as the company calls it — comprises DNS resolution, the registries for .us, .biz and .co, and the back-end registry for many new gTLDs. It brought in revenue of $140.3 million in 2014.
According to Reuters, Neustar is currently talking to advisers about the potential sale of the company, which is currently listed on the New York Stock Exchange, to private equity.
The potential buyers are reportedly waiting for the award of the number portability contract before sealing the deal.

Jeff Neuman quits Neustar for Valideus

Neustar’s top domain name guy is moving to UK new gTLD consultancy Valideus.
Jeff Neuman, who’s been with Neustar for over 15 years, will become Valideus’ senior vice president for North America, starting this coming Monday, according to Valideus managing director Nick Wood.
I don’t know who’s replacing him at Neustar, where he’s been in charge of the company’s domain name business for the last couple of years, overseeing the company’s business as a registry back-end provider and registry for New York’s .nyc new gTLD.
Neuman was previously Neustar’s longstanding VP of policy, a role which also saw him heavily involved in ICANN’s GNSO Council and Neustar’s application for and launch of .biz, back in 2000.
He’s been quite a pivotal and sometimes outspoken figure over the years.
Valideus is the new gTLD service provider sister company to Com Laude, the brand-focused registrar. It provides application consulting and ongoing registry/registrar management for dot-brand gTLD applicants and registries, Amazon among them.
I gather that Neuman will remain based in the US, as his new job title implies.

Governments totally cool with two-letter domains

ICANN’s Governmental Advisory Committee does not plan to advise against the release of two-character domain names in new gTLDs.
In fact, judging by a GAC discussion at ICANN 51 in Los Angeles yesterday, the governments of many major nations are totally cool with the idea.
Under the standard Registry Agreement for new gTLD registries, all two-character domains (any combination of letters, numbers) must not be sold or activated in the DNS.
The blanket ban was designed to avoid clashes with two-letter ccTLD codes, both existing and future.
ICANN left the door open for registries to request the release of such names, however, and many companies have formally applied to do so via the Registry Services Evaluation Process.
Some registries want all two-character domains released, others have only asked for permission to sell those strings that do not match allocated ccTLDs.
There seems to have been an underlying assumption that governments may want to protect their geographic turf. That assumption may turn out to be untrue.
Representatives from the United States, Netherlands, Spain, Denmark, Australia, Austria and Iran all said yesterday that the GAC should not issue formal advice against the the two-character proposals.
No governments opposed that apparent consensus view.
“The use of the ‘US’ two-letter country code at the second level has not presented any technical or policy issues for the United States,” US rep Suzanne Radell said.
“We, in fact, do not require any approval for the use of US two-character country codes at the second level in existing gTLDs, and do not propose to require anything for new gTLDs,” she said.
She even highlighted domains such as us.com and us.org — which are marketed by UK-based CentralNic as alternatives to the .us ccTLD — as being just fine and dandy with the US government.
It seems likely that the GAC will instead suggest to ICANN that it is the responsibility of individual governments to challenge the registries’ requests via the RSEP process.
“What we see at the moment is that ICANN is putting these RSEP requests out for public comment and it would be open to any government to use that public comment period if they did feel in some instances that there was a concern,” Australian GACer Peter Nettlefold said.
I’ve not been able to find any government comments to the relevant RSEP requests.
For example, Neustar’s .neustar, which proposes the release of all two-character strings including country codes, has yet to receive a comment from a government.
Many comments in other RSEP fora appear to be from fellow dot-brand registries that want to use two-letter codes to represent the countries where they operate.

Fight over ICANN’s $400,000 Hollywood party

Corporate sponsors raised $250,000 to fund a $400,000 showbiz gala for ICANN 51 next month, but ICANN pulled the plug after deciding against making up the shortfall.
Sources tell DI that the lavish shindig was set to take place at Fox Studios in Los Angeles on October 15, but that ICANN reneged on a commitment to throw $150,000 into the pot.
Meanwhile, a senior ICANN source insists that there was no commitment and that a “misunderstanding” is to blame.
ICANN announced a week ago that its 51st public meeting would be the first in a while without a gala event. In a blog post, VP Christopher Mondini blamed a lack of sponsors and the large number of attendees, writing:

One change from past meetings is that there will not be an ICANN51 gala. Historically, the gala has been organized and supported by an outside sponsor. ICANN51 will not have such a sponsor, and therefore no gala. ICANN meetings have grown to around 3,000 attendees, and so have the challenges of finding a gala sponsor.

This explanation irked some of those involved in the aborted deal. They claim that the post was misleading.
Sources say that sponsors including Fox Studios, Neustar and MarkMonitor had contractually committed $250,000 to the event after ICANN promised to deliver the remaining $150,000.
But ICANN allegedly changed its mind about its own contribution and, the next day, published the Mondini post.
“The truth is there were sponsors, the truth is it wasn’t too big,” said a source who preferred not to be named. “There was enough money there for a gala.”
The venue was to be the Fox Studios backlot, which advertises itself as being able to handle receptions of up to 4,000 people — plenty of space for an ICANN gala.
I’ve confirmed with Neustar, operator of the .us ccTLD, that it had set aside $75,000 to partly sponsor the event.
But Mondini told DI that ICANN had not committed the $150,000, and that claims to the contrary were based on a “misunderstanding” — $150,000 was the amount ICANN spent on the Singapore gala (nominally sponsored by SGNIC), not how much it intended to spend on the LA event.
“There was no ICANN commitment to make up shortfall,” he said. “It was misheard as an ICANN commitment.”
More generally, ICANN’s top brass are of the opinion that “we shouldn’t be in the business of spending lots of money on galas”, Mondini added.
“ICANN paying for galas is the exception rather than the rule,” he said.
He added that he stood by his blog post, saying that a failure to find sponsors to cover the full $400,000 tab is in fact a failure to find sponsors.

NYC picks Panama registrar for reserved names

The City of New York is working with Panama-based registrar CCI REG to reserve government-related domains in the new .nyc gTLD, despite imposing residency requirements on registrants.
CCI REG director Gerardo Aristizabal tells us it has already handled over 100 registrations during the “City Government-Affiliated Reserve List” phase of .nyc’s protracted launch schedule.
While it’s not technically an exclusive deal, the registrar does appear to be the registrar of choice for the City.
Aristizabal says that he’s in the process of setting up a New York-based registrar to handle .nyc-related business in future.
But today CCI REG is incorporated in Panama and is perhaps best-known to DI readers for being one of .CO Internet’s launch registrars. .CO is now of course owned by Neustar, .nyc’s back-end.
The registrar operated my.co, which focused on the Colombian market. for .co. For .nyc, it’s operating at hellodotnyc.com.
It amuses me that the City of New York, which is also the contracted registry for the gTLD, would choose to use an overseas registrar, given .nyc’s restricted policies.
To buy a .nyc name during general availability, currently slated for October, you’ll need a New York mailing address.