Beckstrom slams his own board over conflicts

ICANN CEO Rod Beckstrom today offered a scathing criticism of his own board of directors, saying the current batch looks like it is too conflicted to act in the public interest.
During his opening address here at ICANN’s 43rd public meeting in San Jose, Costa Rica, Beckstrom appeared to single out the chair and vice-chair for special concern.
“ICANN must be able to act for the public good while placing commercial and financial interests in the appropriate context,” Beckstrom said. “How can it do this if all top leadership is from the very domain name industry it is supposed to coordinate independently?”
He noted that ICANN has spent the last eight months introducing new conflicts of interest and ethics rules but said it was “time to further tighten up the rules” in response to “the growing chorus of criticism about ICANN’s ethics environment”.
“There is value in having community members with domain name industry experience but it is equally valuable to avoid even the perception of a conflict of interest,” he said.
At ICANN’s last board meeting seven directors – including chair Steve Crocker and vice-chair Bruce Tonkin – excused themselves from a new gTLDs discussion due to conflicts.
Crocker’s company, Shinkuro, has registry services provider Afilias as an investor. Tonkin works for the registrar Melbourne IT, which expects to work with over 100 new gTLD applicants.
ICANN has 21 directors, of which 16 have voting powers. At least four voting directors – Crocker, Tonkin, Sebastian Bachollet and Bertrand de La Chapelle – have disclosed new gTLD conflicts.
But Beckstrom spent more time criticizing ICANN’s secretive Nominating Committee, which appoints half of the ICANN board. NomCom’s structure is a “significant threat” to ICANN, he said.
In future, all of NomCom’s board candidates should be “financially independent of the domain name industry,” he said, and NomCom members themselves should be “free of conflicts”.
“Reform of the board selection process is not just desirable. I believe it is imperative,” he said. “Ideally, a fully independent and non-conflicted NomCom should be in place before the next nomination cycle begins.”
The current NomCom-appointed directors are: Crocker, Cherine Chalaby, Bertrand de La Chapelle, Erika Mann, Gonzalo Navarro, R. Ramaraj, George Sadowsky and Judith Duavit Vazquez
Of those eight appointees, two have new gTLD conflicts of interest that have caused them to recently recuse themselves from board discussions on the topic.
Beckstrom’s opening address also covered IPv6 and DNSSEC deployment, new gTLD protections and the applicant support program, but he did not address the IANA contract problem in any detail.

Big Content issues gTLD lock-down demands

Twenty members of the movie, music and games businesses have asked ICANN to impose strict anti-piracy rules on new top-level domains related to their industries.
In a position statement, “New gTLDs Targeting Creative Sectors: Enhanced Safeguards”, the groups say that such gTLDs are “fraught with serious risks” and should be controlled more rigorously than other gTLDs.
“If new gTLDs targeted to these sectors – e.g., .music, .movies, .games – are launched without adequate safeguards, they could become havens for continued and increased criminal and illegal activity,” the statement says.
It goes on to make seven demands for regulations covering Whois accuracy, enforced anti-piracy policies, and private requests for domain name take-downs.
The group also says that the content industries should be guaranteed “a seat at the table” when these new gTLD registries make their policies.
The statement is directed to ICANN, but it also appears to address the Governmental Advisory Committee, which has powers to object to new gTLD applications:

In evaluating applications for such content-focused gTLDs, ICANN must require registry operators (and the registrars with whom they contract) to implement enhanced safeguards to reduce these serious risks, while maximizing the potential benefits of such new domains.
Governments should use similar criteria in the exercise of their capability to issue Early Warnings, under the ICANN-approved process, with regard to new gTLD applications that are problematic from a public policy or security perspective.

The statement was sent to ICANN by the Coalition for Online Accountability, which counts the American Society of Composers, Authors and Publishers, the Motion Picture Association of America, the Recording Industry Association of America and Disney among its members.
It was separately signed by the many of the same groups that are supporting Far Further’s .music application, including the American Association for Independent Music and the International Federation of the Phonographic Industry.

Here’s how new gTLD batching will work

ICANN has revealed the unusual process new top-level domain applicants will have to use to compete for premium gTLD evaluation batch slots.
Senior vice president Kurt Pritz described a “Target Time Variance” system at a meeting with the GNSO Council at ICANN’s public meeting in Costa Rica this morning.
It’s a fairground skill game, essentially, but without the carnies.
Here’s how it will work.
At some point after the application window has closed, new gTLD applicants will be asked to pick a “target time” – a date and time in the near future.
They will then have to visit the ICANN TLD Application System and click a “Submit” button as close to that target time as possible.
The closer the applicant is to its chosen target time — presumably measured by ICANN’s server time — the higher priority in the batching process its application.
After all the times are collected, batches will be created by selecting the fastest applicant from each of the five ICANN geographic regions, then the second-fastest, and so on in a round-robin fashion.
Applicants will also be able to opt-out if time to market is not a major concern.
What ICANN seems to have created could be compared to a domain name drop or a landrush period, in which the company with the best technology stands the best chance of securing the asset.
Pritz said applicants will get a chance to test the system and calibrate their response times.
Network latency at the time the applicant hits submit may prove to be a critical factor – applicants are already today thinking aloud about renting servers as few hops from ICANN’s servers as possible.
“It’s clearly first-come first served,” GNSO Council chair Stephane Van Gelder said during the session this morning.
Council member Wendy Seltzer asked, given all the unpredictable network factors that could impact an applicant’s response time, how Time Target Variance is any different to random selection.
ICANN has of course rejected random selection – everybody’s preferred option – because companies opposed to new gTLDs would immediately sue ICANN to block the program for violations of Californian gambling laws.
“Random selection is just not available,” Pritz said. “Significant legal analysis was done over a long period of time.”
But there’s no beating the lawyers, apparently. Now attendees here in Costa Rica are wondering whether this skill game may potentially violate American disability/access laws, which doesn’t seem to be something ICANN has considered.
The Time Target Variance system has not yet been approved by the ICANN board of directors. That could happen at its meeting this Friday.

Six hot topics for new gTLD applicants at ICANN 43

Hundreds of stakeholders are gathering in San Jose, Costa Rica today for the first official day of ICANN’s 43rd public meeting.
While the news that the US government has deferred the renewal of ICANN’s IANA contract for another six months has set the most tongues wagging so far, there’s a lot more going on.
In this in-depth DomainIncite PRO ICANN 43 preview, we take a look at:

• Why many attendees think the shock IANA news is a personal slight against ICANN CEO Rod Beckstrom.
• How protecting the Olympic and Red Cross trademarks could lead to the new gTLD application window being extended.
• Why the Governmental Advisory Committee is pushing for greater powers to reject new gTLD applications.
• Which companies have applied for the potentially lucrative Trademark Clearinghouse contract (and which one is our favorite to win), and why unanswered questions have the IP community worried.
• What criteria new gTLDs will be judged against after they launch.
• Why critical talks between ICANN and domain name registrars could lead to the retail price of domain names doubling, and why that probably won’t happen any time soon.

DomainIncite PRO subscribers can read the full analysis here. Non-subscribers can find subscription information here.

NTIA says ICANN “does not meet the requirements” for IANA renewal

The National Telecommunications and Information Administration has dealt a stunning blow to ICANN in its bid to carry on running the internet’s critical IANA functions.
The NTIA said this hour that it has canceled the RFP for the new IANA contract “because we received no proposals that met the requirements requested by the global community”
NTIA thinks that ICANN’s bid was unsatisfactory, in other words.
The NTIA said:

Based on the input received from stakeholders around the world, NTIA added new requirements to the IANA functions’ statement of work, including the need for structural separation of policymaking from implementation, a robust companywide conflict of interest policy, provisions reflecting heightened respect for local country laws, and a series of consultation and reporting requirements to increase transparency and accountability to the international community.
The government may cancel any solicitation that does not meet the requirements. Accordingly, we are cancelling this RFP because we received no proposals that met the requirements requested by the global community. The Department intends to reissue the RFP at a future date to be determined (TBD) so that the requirements of the global internet community can be served.

However, it has extended ICANN’s current IANA contract until September 30, 2012.
This means ICANN still has its IANA powers over the DNS root zone, at least for another six months.
While the NTIA has not yet revealed where ICANN’s bid for the contract fell short, it is known that the NTIA and ICANN’s senior management did not exactly see eye to eye on certain issues.
One of the key sticking points is the NTIA’s demand that the IANA contractor – ICANN – must document that all new gTLD delegations are in “the global public interest”.
This demand is a way to prevent another controversy such as the approval of .xxx a year ago, which the Governmental Advisory Committee objected to on the grounds that it was not the “the global public interest”.
Coupled with newly strengthened Applicant Guidebook powers for the GAC to object to new gTLD application, the IANA language could be described as “if the GAC objects, you must reject”.
If the GAC were to declare .gay or .catholic “not in the global public interest”, it would be pretty tough for ICANN to prove otherwise.
But ICANN CEO Rod Beckstrom has previously stated that he believed such rules imposed by the US government would undermine the multistakeholder process.
He told the NTIA last June that the draft IANA contract language stood to “rewrite” ICANN’s own process when it came to approving new gTLDs.

The IANA functions contract should not be used to rewrite the policy and implementation process adopted through the bottom-up decision-making process. Not only would this undermine the very principle of the multi-stakeholder model, it would be inconsistent with the objective of more clearly distinguishing policy development from operational implementation by the IANA functions operator.

Since then, language requiring ICANN to prove “consensus” on new gTLD delegations was removed, but language requiring it to demonstrate the “global public interest” remains.
The game is bigger than petty squabbling about new gTLDs, however.
The US government is worried about International Telecommunications Union treaty talks later this year, which many countries want to use to push for government-led internet governance.
A strong GAC, backed by an enforceable IANA contract, is one way to field concerns that ICANN is not responsive enough to government interests.
It’s tempting to view the deferral of the IANA renewal as an attempt to wait out Beckstrom’s tenure as CEO – he’s set to leave at the end of June – and deal with a more compliant replacement instead.

NTIA throws a bomb, cancels IANA contract RFP

Just hours before ICANN’s Costa Rica meeting kicks off, the US National Telecommunications and Information Administration has cast uncertainty over the new gTLD program by throwing another of its now-traditional last-minute bombs.
CLICK HERE for the updated story.
It’s canceled the request for proposals that was expected to lead to ICANN being awarded a new IANA contract – the contract that enables it to approve new top-level domains.
In an amendment to the November RFP posted last night, the Department of Commerce said it “hereby cancels RFP SA1301-12-RP-IANA in its entirety.”
In a notice on the Federal Business Opportunities web site, it added:

Request for Proposal (RFP) SA1301-12-RP-IANA is hereby cancelled. The Department of Commerce intends to reissue the RFP at a future date, date to be determined (TBD). Interested parties are encouraged to periodically visit www.fbo.gov for updates.

ICANN’s current IANA agreement is due to expire at the end of March and, by my reading, the NTIA has used up all of its options to extend.
Many expected ICANN or the NTIA to announce that the new contract had been awarded to ICANN yesterday, or when the Costa Rica meeting officially kicks off this coming Monday.
For the RFP to be canceled now without explanation hangs a huge question mark over ICANN’s ongoing ability to approve new gTLDs.
There are already community murmurs about ICANN extending the current gTLD application window beyond its current April 12 deadline, and this development may feed such rumors.
This is a developing story, but at the moment it appears that yet again the NTIA’s last-minute attention-seeking bombshell has stolen the show before the show even begins.
UPDATE: Shortly after this story was published, the NTIA released its rationale for the cancellation. Read about it here.

WIPO releases 2011 cybersquatting stats

WIPO handled more UDRP cases covering more domain names in 2011 than in any other year, but its numbers do not paint a very convincing picture of the cybersquatting landscape.
The organization today announced that it handled 2,764 UDRP cases covering 4,781 domain names last year. The number of cases was up 2.5% over 2010.
The number of domain names covered by these cases was up by 9.4% – an additional 414 domains.
It’s basically meaningless data if you’re looking to make a case that cybersquatting is on the increase.
Obviously, while WIPO is the market-share leader, it is not the only UDRP provider. It sees a representative but non-exhaustive sample of cases.
While UDRP is the standard dispute mechanism for all ICANN-contracted gTLDs, WIPO also has side deals with ccTLD registries to look after cybersquatting cases in their zones.
As WIPO has added more ccTLD deals, it has become harder to make apples-to-apples comparisons year over year.
Based on WIPO’s own records, it received 2,323 UDRP complaints about domains in gTLDs last year, up by 28 cases from 2010, a 1.2% increase.
Given that the number of domains registered in gTLDs increased by at least 8% between January 1 and November 30 2011, cybersquatting seems to be actually on the decrease in relative terms.
And given that the number of UDRP cases filed is so piddlingly small, a single obsessive-compulsive complainant (ie, Lego) can skew the results.
Lego spammed WIPO with more than 160 complaints in 2011. As a result, Denmark is the last year’s fourth-biggest filer after the US, France and UK, according to WIPO, with 202 complaints.
So, if you see any company using these WIPO numbers to rage about cybersquatting in press releases, ICANN comments or Congressional hearings, give them a slap from me. Thanks.
Here’s a table of WIPO’s caseload from 2000 to 2011.
[table id=6 /]
Sadly, the number of UDRP complaints will never reflect the actual amount of cybersquatting going on, particularly when cybersquatters only need to price their domains more cheaply than the cost of a UDRP complaint in order to stay off the radar.
WIPO’s data does raise some interesting questions about the geographic distribution of complainants and respondents, however.
Unsurprisingly, cybersquatting was found to be big business in China, the second most-common home nation, after the US, for respondents. No UDRPs filed with WIPO originated there, however.
Surprisingly, Australia is ranked fourth on the list of countries most likely to harbor alleged squatters, with 171 respondents. But Australia was 13th in terms of complainant location, with just 39 cases.
Read more WIPO data here.

IP lobby files last-minute new gTLD demands

ICANN’s ongoing public comment period into the “perceived” need for “defensive” gTLD applications produced a raft of demands from the intellectual property community, not all of which relate to the subject matter at hand.
With less than one month left before ICANN closes its new gTLD application window, many IP stakeholders have suggested ways to reduce the need to file a defensive applications, with many disputing its characterization as “perceived”. As far as many brands are concerned, there’s nothing “perceived” about it.
Give the imminent closure of the window, a large number of commenters have also suggested ways to reduce the need for defensive domain name registrations at the second level. While debates about trademark protection in domain names will never end, this is likely to be the IP community’s last chance to officially comment before April 12.
Some comments expressed a desire for relatively small tweaks to the existing Rights Protection Mechanisms, others said that entirely new RPMs should be created. In most cases, the proposed amendments heavily favor certain trademark owners at the expense of other registrants, including other trademark owners.
Some suggestions from the IP community would, if adopted, directly impact the business models of new gTLD registries and registrars. Others could be expected to significantly increase the risk that the new gTLD application process will be gamed at a large scale.
This DomainIncite PRO analysis is organized by issue, addressing concepts that emerged from multiple comments. In each case, we look at the likely counter-arguments to the proposals, explore the potential impact on applicants and the new gTLD program and assess the likelihood of each proposal becoming reality.
DI PRO subscribers can read the full analysis here.

Olympic gTLD showdown coming in Costa Rica

While the ICANN public meeting in Dakar last October was notable for a heated clash between governments and the domain name industry, the Costa Rica meeting next week may be characterized by these two recent enemies uniting against a common enemy.
ICANN staff.
Members of the Generic Names Supporting Organization, the Governmental Advisory Committee and the At-Large Advisory Committee all appear to be equally livid about a last-minute new gTLD program surprise sprung by ICANN late last week.
The hitch relates to the ongoing saga about special brand protection for the International Olympic Committee, Red Cross and Red Crescent movements in the new gTLD program.
The need to develop rights protection mechanisms for essentially just three organizations has always been a slightly ridiculous and unnecessary premise, but recently it has assumed symbolic proportions, cutting to the heart of the multistakeholder model itself.
Now, following a perplexing eleventh-hour ICANN mandate, Costa Rica is likely to see some fierce debate about the ICANN decision to kick off the new gTLD program last June.
We expect the GNSO and the GAC to show a relatively united front against ICANN staff on the IOC/RC issue. The At-Large Advisory Committee is also set to throw a bomb or two.
There’s even an outside chance that upcoming talks could wind up adding delay to the next phase of the new gTLD program itself…
The full text of this pre-ICANN 43 policy analysis is available to DomainIncite PRO subscribers here.

China cracks down on new gTLD applicants

Chinese companies planning to apply to ICANN for a new generic top-level domain will have to get a permit from the government, it has been announced.
Applicants will have to reveal their services, their contingency plans, and their trademark protection and anti-abuse procedures, among other details, to China before applying.
The news, which could be troubling to some Chinese gTLD applicants, came in an official Ministry of Industry and Information Technology announcement yesterday.
A local source confirmed that the Ministry plans to issue permits to new gTLD applicants.
It seems to apply to any gTLD, but a second set of regulations to govern the obtaining of government non-objection letters in the case of geographic strings has also been introduced.
These rules seem to apply only to local companies. As far as I know China is not yet claiming exclusive ownership of the Chinese language and script as it has in the past.
I also hear on the grapevine that China thinks ICANN is subject to a business tax on its $185,000 application fees, and that applicants are being asked to pre-pay this tax on ICANN’s behalf.
The nation has form when it comes to heavy-handed domain name industry regulation.
Rules forcing registrants to submit ID when they register .cn domain names have caused the number of ccTLD registrations to plummet over the last couple of years.
The .cn space peaked at about 14 million domains under management in 2009 and stands at just 3.3 million today.