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ICANN explains how .org pricing decision was made

Kevin Murphy, July 10, 2019, 08:58:47 (UTC), Domain Registries

ICANN has responded to questions about how its decision to lift price caps on .org, along with .biz and .info, was made.
The buck stops with CEO Göran Marby, it seems, according to an ICANN statement, sent to DI last night.
ICANN confirmed that was no formal vote of the board of directors, though there were two “consultations” between staff and board and the board did not object to the staff’s plans.
The removal of price caps on .org — which had been limited to a 10% increase per year — proved controversial.
ICANN approved the changes to Public Interest Registry’s contract despite receiving over opposing messages from 3,200 people and organizations during its open public comment period.
Given that the board of directors had not voted, it was not at all clear how the decision to disregard these comments had been made and by whom.
The Internet Commerce Association, which coordinated much of the response to the comment period, has since written to ICANN to ask for clarity on this and other points.
ICANN’s response to DI may shed a little light.
ICANN staff first briefed the board about the RA changes at its retreat in Los Angeles from January 25 to 28 this year, according to the statement.
That briefing covered the reasons ICANN thinks it is desirable to migrate legacy gTLD Registry Agreements to the 2012-round’s base RA, which has no pricing controls.
The base RA “provides additional safeguards and security and stability requirements compared to legacy agreements” and “creates efficiencies for ICANN org in administration and compliance enforcement”, ICANN said.
Migrating old gTLDs to the standardized new contract complies with ICANN’s bylaws commitment “to introduce and promote competition in the registration of domain names and, where feasible and appropriate, depend upon market mechanisms to promote and sustain a competitive environment in the DNS market”, ICANN said.
They also contain provisions forcing the registry to give advance notice of price changes and to give registrants the chance to lock-in prices for 10 years by renewing during the notice period, the board was told.
After the January briefing, Marby made the call to continue negotiations. The statement says:

After consultation with the Board at the Los Angeles workshop, and with the Board’s support, the CEO decided to continue the plan to complete the renewal negotiations utilizing the Base RA. The Board has delegated the authority to sign contracts to the CEO or his designee.

A second board briefing took place after the public comment periods, at the board’s workshop in Marrakech last month.
The board was presented with ICANN’s staff summary of the public comments (pdf), along with other briefing documents, then Marby made the call to move forward with signing.

Following the discussion with the Board in Marrakech, and consistent with the Board’s support, the CEO made the decision for ICANN org to continue with renewal agreements as proposed, using the Base gTLD Registry Agreement.

Both LA and Marrakech briefings “were closed sessions and are not minuted”, ICANN said.
But it appears that the board of directors, while not voting, had at least two opportunities to object to the new contracts but chose not to stand in staff’s way.
At the root of the decision appears to be ICANN Org’s unswerving, doctrinal mission to make its life easier and stay out of price regulation to the greatest extent possible.
Reasonable people can disagree, I think, on whether this is a worthy goal. I’m on the fence.
But it does beg the question: what’s going to happen to .com?

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Comments (4)

  1. Rubens Kuhl says:
    July 10, 2019 at 11:17 am

    .com still has USG DoC oversight, and while the new administration approved a level of price raises, I don’t see them going full market freedom in this.
    But .net is likely to follow .org path sooner or later.

    Reply
  2. Jack says:
    July 10, 2019 at 11:37 am

    Marby should be fired !
    If he wants “to introduce and promote competition in the registration of domain names and, where feasible and appropriate, depend upon market mechanisms to promote and sustain a competitive environment in the DNS market”
    THEN JUST PUT THE .COM CONTRACT FOR BID
    PERIOD

    Reply
  3. Steve Gobin says:
    July 10, 2019 at 12:24 pm

    It hasn’t been said a lot but the switch of .org, .biz and .info to a RA that is identical to the one between ICANN and each new gTLD operator also means that the URS will apply to these legacy gTLDs too (with a grace period of up to 270 days), which is a good news for the trademark holders.

    Reply

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