New gTLD winners will be decided by lottery after all

ICANN will use a lottery to decide the order in which to process new gTLD applications, after a surprising U-turn.
ICANN this morning published a proposal that would prioritize applications based on a $100-a-ticket prize draw that would run in early December.
The results of the draw would be used to sequence applications for Initial Evaluation and, if successful, contract negotiations, pre-delegation testing and eventual delegation.
ICANN says the draw would give it an exemption to California’s anti-lottery laws, which was the primary reason it has so far resisted chance-based solutions to the batching/sequencing problem.
It’s applied for a special “fundraising drawings” license based on its non-profit status, which it expects to be granted before the end of November.
The license appears to have certain restrictions that confuse matters for applicants — they won’t be able to buy their tickets over the internet.
They’ll have to pay, in-person, for a paper ticket. But ICANN says that it can supply proxies for applicants at no cost, eliminating the need to fly a representative to California.
The whole process will be manual, so there’s little risk of an embarrassing Digital Archery-style snafu.
Applications for internationalized domain names would be given priority.
The draw would be run at some point between December 4 and 15.
Under the proposal, the results of Initial Evaluation would start to be released from March next year, starting with IDNs, at a rate of about 150 per week.
ICANN has also decided to extend the period for official objections to March 13, 2013, two months more than the current plan, due to requests for more time from potential objectors.
But the extension is unlikely to appease these objectors, which will still have to file objections before they know whether applications have passed Initial Evaluation, wasting money.
New gTLD applicants that pass Initial Evaluation, are not in contention and have no objections will have the option to immediately sign the standard registry contract.
Applicants wishing to negotiate their contracts will be processed according to their draw number.
However, no contracts will be signed before the ICANN meeting in Beijing next April. This is because the Governmental Advisory Committee does not expect to issue its formal Advice on applications before then.
ICANN expects to sign contracts and do pre-delegation testing at a rate of about 20 per week, which is roughly within the maximum 1,000-per-year delegation rate it has committed to.
The effect of this is that the first new gTLDs are expected to go live in the DNS root in the second quarter of 2013, rather than the third quarter.
I believe most of the proposals will be welcomed by most applicants. A lottery was always the most favored solution.
There will be some criticisms, however.
There does not appear to be a method envisaged for swapping slots, for example, so portfolio applicants probably won’t get to choose which of their gTLDs is delegated first.
The whole proposal is open for public comment here.

New gTLD hopefuls set aggressive targets for ICANN

ICANN should start delegating new gTLDs in the first quarter of next year as previously planned and the Governmental Advisory Committee should work faster.
That’s according to many new gTLD applicants dropping their ideas into ICANN’s apparently semi-official comment box on application “metering” over the last week or so.
ICANN wanted to know how it should queue up applications for eventual delegation, in the wake of the death of batching and digital archery.
According to information released over the past couple of weeks, it currently plans to release the results of Initial Evaluation on all 1,924 still-active applications around June or July next year, leading to the first new gTLDs going live in perhaps August.
But that’s not good enough for many applicants. Having successfully killed off batching, their goal now is to compress the single remaining batch into as short a span as possible.
The New TLD Applicant Group, a new observer group recognized by ICANN’s Registry Stakeholder Group, submitted lengthy comments.
NTAG wants Initial Evaluation on all applications done by January 2013, and for ICANN to publish the results as they trickle in rather than in one batch at the end.
The suggested deadline is based on ICANN’s recent statement that its evaluators’ processing powers could eventually ramp up to 300 applications per month. NTAG said in its comments:

Notwithstanding ICANN’s statements to the contrary, there is not a consensus within the group that initial evaluation results should be held back until all evaluations are complete; in fact, many applicants believe that initial evaluation results should be released as they become available.

That view is not universally supported. Brand-centric consultancy Fairwinds and a couple of its clients submitted comments expressing support for the publication of all Initial Evaluation results at once.
January 2013 is an extremely aggressive deadline.
Under the batching-based schedule laid out in the Applicant Guidebook, 1,924 applications would take more like 20 months, not seven, to pass through Initial Evaluation.
NTAG could not find consensus on methods for sequencing applications among its members. Separate submissions from big portfolio applicants including Donuts, Uniregistry, TLDH and Google and smaller, single-bid applicants gave some ideas, however.
Donuts, for example, hasn’t given up on a game-based solution to the sequencing problem – including, really, Rock Paper Scissors – though it seems to favor a system based on timestamping.
The company is among a few to suggest that applications could be prioritized using the least-significant digits of the timestamp they received when they were submitted to ICANN.
An application filed at 15:01:01 would therefore beat an application submitted at 14:02:02, for example.
This idea has been out there for a while, though little discussed. I have to wonder if any applicants timed their submissions accordingly, just in case.
Comments submitted by TLDH, Google and others offer a selection of methods for sequencing bids which includes timestamping as well alphabetical sorting based on the hash value of the applications.
This proposal also supports a “bucketing” approach that would give more or less equal weight to five different types of application – brand, geographic, portfolio, etc.
Uniregistry, uniquely I think, reckons it’s time to get back to random selection, which ICANN abandoned due to California lottery laws. The company said in its comments:

Random selection of applications for review should not present legal issues now, after the application window has closed. While the window was still open, random selection for batches would have given applicants an incentive to file multiple redundant applications, withdrawing all but the application that placed earliest in the random queue and creating a kind of lottery for early slots. Now that no one can file an additional application, that lottery problem is gone.

Given that the comment was drafted by a California lawyer, I can’t help but wonder whether Uniregistry might be onto something.
Many applicants are also asking the GAC to pull its socks up and work on its objections faster.
The GAC currently thinks it can file its official GAC Advice on New gTLDs in about April next year, which doesn’t fit nicely with the January 2013 evaluation deadline some are now demanding.
ICANN should urge the GAC to hold a special inter-sessional meeting to square away its objections some time between Toronto in October and Beijing in April, some commenters say.
ICANN received dozens of responses to its call for comments, and this post only touches on a few themes. A more comprehensive review will be posted on DI PRO tomorrow.