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Verisign to keep price increase power under new .net contract

Kevin Murphy, April 21, 2017, Domain Registries

The wholesale price of a .net domain is likely to top $15 by 2023, under a proposed renewal of its ICANN contract revealed today.

ICANN-imposed price caps are staying in the new Registry Agreement, but Verisign retains the right to increase its fees by 10% in each of the six years of the deal’s lifespan.

But domain investors do have at least one reason to be cheerful — while the contract adds many features of the standard new gTLD registry agreement, it does not include a commitment to implement the Uniform Rapid Suspension anti-cybersquatting procedure.

The current .net annual fee charged to registrars is $8.95 — $8.20 for Verisign, $0.75 for ICANN — but Verisign will continue to be allowed to increase its portion by up to 10% a year.

That means the cost of a .net could hit $15.27 wholesale (including the $0.75 ICANN fee) by the time the proposed contract expires in 2023.

Verisign has form when it comes to utilizing its price-raising powers. It exercised all six options under its current contract, raising its share of the fee from $4.65 in 2011.

On the bright side for volume .net holders, the prices increases continue to be predictable. ICANN has not removed the price caps.

Also likely to cheer up domainers is the fact that there are no new intellectual property protection mechanisms in the proposed contract.

Several post-2000 legacy gTLDs have agreed to incorporate the URS into their new contracts, leading to outrage from domainer organization the Internet Commerce Association.

ICA is worried that URS will one day wind up in .com without a proper ICANN community consensus, opening its members up to more risk of losing valuable domains.

The fact that URS is not being slipped into the .net contract makes it much less likely to be forced on .com too.

But Verisign has agreed to several mostly technical provisions that bring it more into line with the standard 2012-round new gTLD RA.

For example, it appears that daily .net zone files will become accessible via ICANN’s Centralized Zone Data Service before the end of the year.

Verisign has also agreed to standardize the format of its data escrow, Whois and monthly transaction reports.

The company has also agreed to start discussions about handing .net over to an emergency back-end operator in the event it files for bankruptcy.

The current contract is due to expire at the end of June and the proposed new deal would kick in July 1.

It’s now open for public comment until June 13.

Now new gTLDs are being scapegoated for child abuse material (rant)

The guy responsible for getting the string “rape” closely restricted for no reason in .uk domain names is now gunning for ICANN and new gTLDs with a very similar playbook.

Campaigner John Carr, secretary of the little-known Children’s Charities’ Coalition on Internet Safety, wants ICANN to bring in strict controls to prevent convicted pedophiles registering domains in child-oriented domains such as .kids.

He’s written to the UK prime minister, the two other ministers with the relevant brief, the US federal government and the California attorney general to make these demands.

That’s despite the fact that he freely acknowledges that he does not have any evidence of a problem in existing kid-oriented TLDs and that he does not expect there to be a problem with .kids, should it be delegated, in future.

Regardless, ICANN comes in for a bit of a battering in the letter (pdf), with Carr insinuating that it and the domain industry are quite happy to throw child safety under the bus in order to make a quick buck. He writes:

ICANN has definitely not been keeping the internet secure for children. On the contrary ICANN shows complete indifference towards children’s safety. This has led to real dangers that ICANN could have prevented or mitigated.

ICANN, the Registries and the Registrars have an obvious financial interest in increasing the number of domain names being sold. Their interest in maximising or securing their revenues appears sometimes to blind them to a larger obligation to protect the weak and vulnerable e.g. in this instance children.

Despite this worrying premise, Carr admits in an accompanying paper (pdf) that the Russian version of .kids (.дети), which has been live for three years and only has about 1,000 registrations, does not seem to have experienced a deluge of sex offenders.

Nevertheless, he says ICANN should have forced the .дети registry to do criminal background checks on all registrants to make sure they did not have a record of sexual offences.

While at the time of writing we have no information which suggests anything untoward has happened with any Russian .kids websites, and we understand the volume of sales has been low so far, the matter should never have been left open in that way. When ICANN let the contract it could have included clauses which would have made it a contractual obligation to carry out the sort of checks mentioned. The fact that ICANN did not do this illustrates a degree of carelessness about children’s well-being which is tantamount to gross negligence.

Quite how a domain registry would go about running criminal records checks on all of its customers globally, and what the costs and the benefits would be, Carr does not say.

The letter goes on to state incorrectly that Amazon and Google are in contention for .kids.

In fact, Google applied for the singular .kid. While the two strings are in contention due to an adverse String Confusion Objection, there’s also a second applicant for .kids, the DotKids Foundation, which proposes to keep .kids highly restricted and which Carr is either unaware of or deliberately omits from his letter.

Based on his assumption that .kids is a two-horse race between Amazon and Google, he says:

while I am sure both Google and Amazon will choose to do the right thing, whichever one is the eventual winner of the contract, the point is matters of this kind should never have been left as an option

So not only does Carr not have any evidence that extant “.kids” domains are currently being abused years after delegation, he’s also sure that .kids won’t be in future.

But he wants Draconian background checks implemented on all registrants anyway.

His letter coincides with the release of and heavily cites the 2016 annual report (pdf) of the Internet Watch Foundation — the organization that coordinates the takedown of child abuse material in the UK and elsewhere.

That report found that new gTLD domains are being increasingly used to distribute such material, but that Verisign-run TLDs such as .com are still by far the most abused for this purpose.

The number of takedowns against new gTLD domains in 2016 was 272 (226 of which were “dedicated to distributing child sexual abuse content”) the IWF reported, a 258% increase on 2015.

That’s 272 domains too many, but averages out at about a quarter of a domain per new gTLD.

There were 2,416 domains being used to distribute this material in 2016, IWF said. That means new gTLDs accounted for about 11% of the total child abuse domains — higher than the 7.8% market share that new gTLDs command (according to Verisign’s Q4 industry brief).

But the IWF report states that 80% of the total abuse domains are concentrated in just five TLDs — .com, .net, .se, .io, and .cc. Even child abusers are not fans of new gTLDs, it seems.

Despite the fact that two of these domains are operated under ICANN contract, and the fact that .io is operated by a British company representing a British overseas territory, Carr focuses his calls for action instead on new gTLDs exclusively.

And his calls are receiving attention.

A The Times article this week cries “New internet domain is magnet for paedophiles, charities warn”, while tabloid stable sister The Sun reported on “fears predators are exploiting new website addresses to hide indecent material”.

This is how it started with Carr’s campaign to get “rape” domains banned in the UK.

Back in 2013, he wrote a blog post complaining that it was possible to register “rapeher.co.uk” — not that it had been registered, only that it could be registered — and managed to place a couple of stories in the right-leaning press calling for Nominet to do more to prevent the registration of “depraved and disgusting” domains such as the one he thought up.

This led to a government minister calling for an independent policy review, an actual review, and a subsequent policy that sees some poor bastard at Nominet having to pore over every .uk registration containing rapey strings to see if they’re potentially advocating or promoting actual rape.

Implementation of that policy has so far confirmed that Carr’s worries were, as I said in my 2013 rant, baseless.

In 2016, there were 2,407 registrations of domains containing the string “rape”, but just one of them was found to be using it in the context of sexual assault and was suspended, according to Nominet stats.

In 2015, the number of suspensions was the same. One.

The same story is playing out now — a single Don Quixote with a tenuous grasp of the systems he’s criticizing calling for ludicrous policies to prevent a problem that he freely admits does not exist and probably won’t exist in future.

Still, at least he gets to wave some headlines in front of his employers to pretend he’s actually earning his salary.

How .com became a restricted TLD

Verisign has been given approval to start restricting who can and cannot register .com and .net domain names in various countries.

Customers of Chinese registrars are the first to be affected by the change to the registry’s back-end system, which was made last year.

ICANN last week gave Verisign a “free to deploy” notice for a new “Verification Code Extension” system that enables the company to stop domains registered via selected registrars from resolving unless the registrant’s identity has been verified and the name is not on China’s banned list.

It appears to be the system Verisign deployed in order to receive its Chinese government license to operate in China.

Under Verification Code Extension, Verisign uses ICANN records to identify which registrars are based in countries that have governmental restrictions. I believe China is currently the only affected country.

Those registrars are able to register domains normally, but Verisign will prevent the names from resolving (placing them in serverHold status and keeping them out of the zone file) unless the registration is accompanied by a verification code.

These codes are distributed to the affected registrars by at least two verification service providers. Verisign, in response to DI questions, declined to name them.

Under its “free to deploy” agreement with ICANN (pdf), Verisign is unable to offer verification services itself. It must use third parties.

The company added the functionality to its .com and .net registry as an option in February 2016, according to ICANN records. It seems to have been implemented last July.

A Verisign spokesperson said the company “has implemented” the system.

The Verification Code Extension — technically, it’s an extension to the EPP protocol pretty much all registries use — was outlined in a Registry Services Evaluation Process request (pdf) last May, and approved by ICANN not long after.

Verisign was approved to operate in China last August in the first wave of gTLD registries to obtain government licenses.

Under Chinese regulations, domain names registered in TLDs not approved by the government may not resolve. Registrars are obliged to verify the identities of their registrants and names containing certain sensitive terms are not permitted.

Other gTLDs, including .vip, .club, .xyz .site and .shop have been granted approval over the last few months.

Some have chosen to work with registration gateway providers in China to comply with the local rules.

Apart from XYZ.com and Verisign, no registry has sought ICANN approval for their particular implementation of Chinese law.

Because Chinese influence over ICANN is a politically sensitive issue right now, it should be pointed out that the Verification Code Extension is not something that ICANN came up with in response to Chinese demands.

Rather, it’s something Verisign came up with in response to Chinese market realities. ICANN has merely rubber-stamped a service requested by Verisign.

This, in other words, is a case of China flexing market muscle, not political muscle. Verisign, like many other gTLD registries, is over-exposed to the Chinese market.

It should also be pointed out for avoidance of doubt that the Chinese restrictions do not apply to customers of non-Chinese registrars.

However, it appears that Verisign now has a mechanism baked into its .com and .net registries that would make it much easier to implement .com restrictions that other governments might choose to put into their own legislation in future.

Verisign report deletes millions of domains from history

Verisign has dramatically slashed its estimates for the number of domains in existence in its quarterly Domain Name Industry Brief reports, two of which were published this week.

The headline number for the end of the fourth quarter is 329.3 million, a 0.7% increase sequentially and a 6.8% increase annually.

But it’s actually a lower number than Verisign reported in its second-quarter report just five months ago, which was 334.6 million.

The big swinger, as you may have guessed if you track this kind of thing, was .tk, the Freenom ccTLD where names are given away for free and then reclaimed and parked by the registry when they are deleted for abuse expire.

It seems a change in the way .tk is counted (or estimated) is the cause of the dip.

Verisign gets its gTLD data for the report from ICANN-published zone files and its ccTLD data from independent researcher Zooknic.

Problem is, Zook hasn’t had up-to-date data on .tk for a couple of years, so every DNIB published since then has been based on its December 2014 numbers.

But with the Q3 report (pdf), Zook revised its .tk estimates down by about six million names.

In earlier reports, the ccTLD was being reported at about 25 million names (exact numbers were not given), but now that’s been slashed to 18.7 million, relegating it to the second-largest ccTLD after China’s .cn, which has 21.1 million.

I’ve asked Freenom to confirm the latest numbers are correct and will update this post if I get a response.

Verisign does not say what caused the decision to scale down .tk’s numbers, but explains what happened like this:

In Q3 2016, Zooknic reported a significant decline in the .tk zone and restated the estimated zone size of .tk for each quarter from Q4 2014 through Q3 2016 using a proprietary methodology. As a result, for comparative purposes of this DNIB to the Q3 2016 DNIB and the Q4 2015 DNIB, Verisign has applied an updated estimate of the total zone size across all TLDs for Q3 2016 of 327.0 million and Q4 2015 of 307.7 million and an updated estimate of the total ccTLD zone size for Q3 2016 of 140.1 million and Q4 2015 of 138.1 million.

Apples-to-apples comparisons in the Q4 report show the ccTLD universe was up to 142.7 million names, a 1.8% sequential increase and up 3.1% on 2015. Excluding .tk, annual growth was 6.9%.

Verisign’s own .com and .net combined grew 1.7% to 142.2 million names at the end of the year, one percentage point smaller than their 2015 growth.

The full Q4 report can be read here (pdf).

Antitrust feds probing Verisign’s .web deal

Kevin Murphy, February 10, 2017, Domain Policy

US antitrust authorities are investigating Verisign over its anticipated operation of the .web gTLD.

The probe was disclosed by company CEO Jim Bidzos in yesterday’s fourth-quarter earnings call. He said:

On January 18, 2017, the company received a Civil Investigative Demand from the Antitrust Division of the US Department of Justice, requesting certain information related to Verisign’s potential operations of the .web TLD. The CID is not directed at Verisign’s existing registry agreements.

He did not comment further, beyond describing it as “kind of like a subpoena”.

Verisign acquired the rights to run .web at an ICANN last-resort auction last July, agreeing to pay $135 million.

Rather than applying for the gTLD itself, it secretly bankrolled shell company Nu Dot Co, which intends to transfer its .web contract to Verisign after it is signed.

ICANN is being sued by rival applicant Donuts, which claims NDC should have been banned from the auction. Afilias, the auction runner up, is also challenging the outcome.

But this new DoJ investigation, if we take Bidzos’ words at face value, appears to focus on what Verisign plans to do with .web once it is live.

It’s the view of many that .web would be the new gTLD best positioned as an alternative to .com, which makes Verisign hundreds of millions of dollars a year.

It’s my view that it would make perfect sense for Verisign to flush the $135 million and bury .web, rather than have a viable competitor on the market.

Verisign has repeatedly said that intends to “grow and widely distribute .web”, words Bidzos repeated last night.

The investigation is likely into whether Verisign wants to actually raise .web, or strangle it in its crib.

It seems the investigation was launched in the dying days of the Obama administration, so the recent changing of the guard at Justice — Attorney General Jeff Sessions was confirmed by Congress just two days ago — may have an impact on how it plays out.

Thick Whois policy for .com is now live

Kevin Murphy, February 2, 2017, Domain Registries

The domain name industry is kicking off one of its most fundamental shifts in its plumbing this week.

Over the next two years, Verisign and every registrar that sells .com domains will have to rejigger their systems to convert .com from a “thin” to “thick” Whois.

This means that by February 1, 2019, Verisign will for the first time control the master database of all Whois records for .com domains, rather than it being spread piecemeal across all registrars.

The switch comes as a result of a years-in-the-making ICANN policy that officially came into force yesterday. It also applies to .com stablemates .net and .jobs.

The first big change will come August 1 this year, the deadline by which Verisign has to give all of its registrars the ability to submit thick Whois records both live (for new regs) and in bulk (for existing ones).

May 1, 2018 is the deadline for all registrars to start submitting thick Whois for new regs to Verisign, but they can start doing so as early as August this year if they want to.

Registrars have until February 1, 2019 to supply Verisign with thick Whois for all their existing registrations.

There’s a process for registrars who believe they would be violating local privacy laws by transferring this data to US-based Verisign to request an exemption, which may prevent the transition going perfectly uniformly.

Some say that the implementation of this policy may allow Verisign to ask for the ability to ask a for an increase in .com registry fees — currently frozen at the command of the US government — due to its inevitably increased costs.

Personally, I think the added costs will likely be chickenfeed compared to the cash-printing machine that is .com, so I think it’s far from a slam-dunk that such fee increases would be approved.

ICA worried ICANN will force URS on .net

Kevin Murphy, January 5, 2017, Domain Registries

The Internet Commerce Association has called for a “moratorium” on the Uniform Rapid Suspension policy being added to legacy gTLD contracts, months before Verisign’s .net contract is up for renewal.

In a blog post, ICA counsel Phil Corwin accused ICANN staff of making policy by the back door by compelling pre-2012 registries to adopt URS, despite a lack of ICANN community consensus policy.

In the last few years the registries for .jobs, .travel, .cat, .pro, .xxx and most recently .mobi have agreed to adopt many aspects of the 2012 Registry Agreement, which includes the URS, often in exchange for lower ICANN fees.

Corwin wrote:

the real test of [ICANN’s Global Domains Division’s] illicit strategy of incremental de facto policymaking will come later this year, when the .Net RA comes up for renewal. We have no idea whether Verisign will be seeking any substantial revisions to that RA that would provide GDD staff with substantial leverage to impose URS, nor do we know whether Verisign would be amenable to that tradeoff.

The .net RA is due to expire July 1 this year.

Verisign pays ICANN $0.75 for each .net domain registration, renewal and transfer. If that were to be reduced to the 2012 standard of $0.25, it would save Verisign at least $7.5 million a year.

The URS provides brand owners with a way to suspend trademark-infringing domains in clear-cut cases. It’s based on UDRP but is faster and cheaper and does not allow the brand owner to seize ownership of the domains.

ICA represents large domain speculators, most of which have their investments tied up in .com and .net domains. It’s complained about the addition of URS to other gTLDs but the complaints have largely fallen on deaf ears.

ICANN has said that it does not force URS on anyone, but that it takes the base new gTLD program RA as its starting point for bilateral negotiations with registries whose contracts are up for renewal.

Trump trends in .com, while stoners hit .net

Kevin Murphy, December 13, 2016, Domain Registries

The US elections last month seem to be responsible for almost all of Verisign’s “top trending keywords” for November.

Donald Trump topped the company’s monthly list of fastest-growing strings in both .com and .net registries.

The four words of his idiotic campaign slogan “Make America great again” also appear individually in the .com top ten.

The votes to legalize medical and recreational marijuana use in several US states also seems to have inspired speculation in “pot”, “weed” and “cannabis” names, though more noticeably in .net.

In fact, the only string in the .com list not related to the US polls appears to be “near” (at least, I cannot find a connection).

The Verisign report includes words that achieve a certain level of growth month-to-month, factoring out strings that are commonly registered every month.

Here are the November lists.

.com.net
TrumpTrump
makecannabis
greatmarijuana
weedweed
againAmerica
Americaagain
DonaldDonald
nearpresident
presidentowner
potmatter

Donuts loses $22.5m .web lawsuit as judge rules gTLD applicants cannot sue

Kevin Murphy, November 30, 2016, Domain Registries

The promise not to sue ICANN that all new gTLD applicants made when they applied is legally enforceable, a California judge has ruled.

Judge Percy Anderson on Monday threw out Donuts’ lawsuit against ICANN over the controversial $135 million .web auction, saying the “covenant not to sue bars Plaintiff’s entire action”.

He wrote that he “does not find persuasive” an earlier and contrary ruling in the case of DotConnectAfrica v ICANN, a case that is still ongoing.

Donuts sued ICANN at first to prevent the .web auction going ahead.

The registry, and other .web applicants, were concerned that ultimately successful bidder Nu Dot Co was being covertly bankrolled by Verisign, which turned out to be completely correct.

Donuts argued that ICANN failed to adequately vet NDC to uncover its secret sugar daddy. It wanted $22.5 million from ICANN — roughly what it would have received if the auction had been privately managed, rather than run by ICANN.

But the judge ruled that Donuts’ covenant not to sue is enforceable. Because of that, he made no judgement on the merits of Donuts’ arguments.

Under the relevant law, Donuts had to show that the applicant contract was “unconscionable” both “procedurally” and “substantively”.

Basically, the question for the judge was: was the contract unfairly one-sided?

The judge ruled (pdf) that it was not substantively unconscionable and “only minimally procedurally unconscionable”. In other words: a bit crap, but not illegal.

He put a lot of weight on the fact that the new gTLD program was designed largely by the ICANN community and on Donuts’ business “sophistication”. He wrote:

Without the covenant not to sue, any frustrated applicant could, through the filing of a lawsuit, derail the entire system developed by ICANN to process applications for gTLDs. ICANN and frustrated applicants do not bear this potential harm equally. This alone establishes the reasonableness of the covenant not to sue.

Donuts VP Jon Nevett said in a statement yesterday that the fight over .web is not over:

Donuts disagrees with the Court’s decision that ICANN’s required covenant not to sue, while being unconscionable, was not sufficiently unconscionable to be struck down as a matter of law. It is unfortunate that the auction process for .WEB was mired in a lack of transparency and anti-competitive behavior. ICANN, in its haste to proceed to auction, performed only a slapdash investigation and deprived the applicants of the right to fairly compete for .WEB in accordance with the very procedures ICANN demanded of applicants. Donuts will continue to utilize the tools at its disposal to address this procedural failure.

It looks rather like we could be looking at an Independent Review Process filing, possibly the first to be filed under ICANN’s new post-transition rules.

Donuts and ICANN are already in the Cooperative Engagement Process — the mediation phase that usually precedes an IRP — with regards .web.

Second-placed bidder Afilias is also putting pressure on ICANN to overturn the results of the auction, resulting in a bit of a public bunfight with Verisign.

TL;DR — don’t expect to be able to buy .web domains for quite a while to come.

Verisign and Afilias in open war over $135m .web

Kevin Murphy, November 11, 2016, Domain Registries

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.