Breaking: Ad industry piles on ICANN

The Interactive Advertising Bureau, which represents over 500 companies including Facebook, Google, eBay and Microsoft, has told ICANN to put a stop to its new top-level domains program.
The cry calls just a couple of weeks after the Association of National Advertisers said it would lobby Congress and may take ICANN to court over the controversial program.
Randall Rothenberg, CEO of the IAB, said in a press release:

ICANN’s potentially momentous change seems to have been made in a top-down star chamber. There appears to have been no economic impact research, no full and open stakeholder discussions, and little concern for the delicate balance of the Internet ecosystem.
This could be disastrous for the media brand owners we represent and the brand owners with which they work. We hope that ICANN will reconsider both this ill-considered decision and the process by which it was reached.

The IAB’s membership is a Who’s Who of leading online media companies, purportedly responsible for selling 86% of online advertising in the US.
It counts AOL, Digg, Amazon, the BBC, Bebo, CNN, Ziff Davis, LinkedIn, Time Warner, Slate, Thomson-Reuters, IDG, the Huffington Post and many other well-known names as members.
Demand Media, too.
If the ANA represents advertisers themselves, the IAB represents the places they spend their advertising money.
It looks like a large portion of corporate America is not happy about new gTLDs. ICANN may have found itself a new, extremely well-funded enemy.

Domain industry blasts Congress TLD hearing

Executives from over a dozen domain name companies have slammed a US Congressional subcommittee for its plan to hold a one-sided hearing on new top-level domains.
A letter, drafted by AusRegistry International’s chief strategy officer, Krista Papac, says the hearing is “not fairly balanced” and “will present a distorted picture of the new gTLD process.”
As I reported earlier this week, the House Subcommittee on Intellectual Property, Competition and the Internet called at least four representatives of the trademark lobby to discuss new TLDs.
Kurt Pritz, ICANN’s senior vice president, is the only person testifying today who could be considered wholly supportive of the new gTLD program. The other witnesses are either advocates of trademark interests or more governmental involvement in ICANN.
Papac wrote:

It is unfortunate that of the six witnesses on the panel, none comes from the perspective of an entity that plans to run a new gTLD and could discuss the innovation, consumer choice, and job growth they will provide. Nor will the committee hear from representatives who might counter some potentially over-reaching views of the intellectual property interests, such as representatives of non-commercial entities, privacy experts, and existing domain name service providers.

The letter goes on to say that IP interests have already been heard, are afforded many protections in the program, and that new TLDs will bring benefits to the US economy.
It was signed by executives from Worldwide Media, eNom, EuroDNS, Right Of The Dot, auDA, Momentous, Othello Technology Systems, Network Solutions, AboutUs.org, Cronon, Domain Dimensions, Tucows, DomainTools, Donuts, Minds + Machines and others.
The hearing begins at 10am in Washington DC today. Coverage later.

VeriSign scores big win in .com pricing lawsuit

VeriSign has successfully had an antitrust lawsuit, which claims the company has been raising .com domain name prices anti-competitively, dismissed by a California court.
While it’s encouraging news if you’re a VeriSign shareholder, the Coalition for ICANN Transparency, which filed the suit, will be allowed to amend and re-file its complaint.
The basis for the dismissal (pdf) goes to the central irony of CFIT – the fact that, despite its noble name, it’s not itself a particularly transparent organization.
CFIT was set up in 2005 in order to sue ICANN and VeriSign over their deal that gave VeriSign the right to raise the price of .com and .net domains, and to keep its registry contracts on favorable terms.
While it was cagey about who was backing the organization, those of us who attended the ICANN meeting in Vancouver that year knew from the off it was primarily a front for Momentous.ca, owner of Pool.com and other domainer services.
In dismissing the case last Friday, Judge Ronald Whyte decided that CFIT’s membership is vague enough to raise a question over its standing to sue on antitrust grounds. He wrote:

By failing to identify its purported members, CFIT has made it impossible to determine whether the members are participants in the alleged relevant markets, or whether they have suffered antitrust injury. Because the [Third Amended Complaint] identifies no members of CFIT, it must be dismissed.

While CFIT had disclosed some time ago Pool.com’s involvement, it recently tried to add uber-domainer Frank Schilling’s Name Administration Inc and iRegistry Corp to the list of its financial supporters.
But Whyte was not convinced that the two companies were CFIT “members” with standing to sue.
Whyte decided that CFIT’s complaint, “fatally fails to allege facts showing that iRegistry or Name Administration were financial supporters or members at the time the complaint was filed”.
He also denied CFIT’s demand for a jury trial.
CFIT wants VeriSign to return all the excess profits it has made on .com registrations since it started raising its prices above $6.
If CFIT were to win, it would severely curtail VeriSign’s ability to grow its registry business, and could lead to billions being wiped off its accounts.
The organization has been given leave to file a fourth amended complaint, so it’s not over yet.

VeriSign may settle CFIT lawsuit

VeriSign’s chief executive has not ruled out settling its potentially damaging lawsuit with the Coalition For ICANN Transparency out of court.
During the company’s second quarter earnings call earlier this week, Mark McLaughlin was asked whether there was a way the lawsuit could be made to go away, settling investor nerves.
His response: “It is an option that could be pursued.”
CFIT, backed by Momentous.ca, claims that VeriSign’s .com and .net no-bid contracts with ICANN, including the price increases they allow, are anti-competitive.
If VeriSign loses the case, it could face the loss of its .com and .net monopolies, which makes me think it will certainly seek to settle the case before that becomes a risk.
VeriSign currently has to decide whether to request a review at the Supreme Court, or go to the District Court for trial. It has until October 7 to make its call.
Also during Monday’s earnings call, McLaughlin addressed the growth opportunities VeriSign is looking at, following its renewed focus on the domain name business.
Asked whether the introduction of new TLDs would affect .com and .net growth, McLaughlin said:

I think it’s positive… just related to .com and .net, with the introduction of new TLDs there’s an expectation it just brings more people to the market and we generally do better when more people show up to the market. And the second thing, we intend to participate in some of those ourselves, so we see growth opportunities for us.

He also confirmed again that VeriSign will seek to launch non-ASCII internationalized versions of its existing TLD base, which includes .com, .net, tv and .name.
As Andrew Allemann noted yesterday, he also declared the pay-per-click-based speculative registration market essentially “dead”.

VeriSign antitrust claims will be heard in court

VeriSign has suffered another legal setback in its antitrust court battle with the Coalition For ICANN Transparency, after an appeals court ruled that CFIT has a case to be heard.
CFIT reckons VeriSign’s deal with ICANN to run the .com registry, which has a presumptive right of renewal and allows annual price increases, breaks US competition law.
Its complaint had been thrown out of court, but was restored on appeal last year. Today, VeriSign’s request for a rehearing was rejected, meaning the case is cleared for trial.
CFIT counsel Bret Fausett tweeted this evening that it will head either back to the District Court, or to the Supreme Court.
The news couldn’t come at a worse time for VeriSign.
The company has spent the last couple of years getting out of most of its non-domain markets, epitomized by the recent sale of its SSL unit to Symantec, so it is ultra-exposed to risk and uncertainty in its highly lucrative .com business.
For that reason, I doubt this case will ever see trial. We’re looking at a settlement, most likely. VeriSign’s probably going to have to break out the check-book.
CFIT is basically a front operation for Momentous.ca, owner of aftermarket player Pool.com.

Remember CFIT? Buy its domain for $250

Remember CFIT? The Coalition For ICANN Transparency is an ironically opaque organization created and backed by Momentous.ca, owner of Pool.com.
It emerged in 2005 to sue ICANN and VeriSign on antitrust grounds, around the same time as they were negotiating .com price increases.
I’d almost forgotten CFIT existed, until CEO Mark McLaughlin mentioned it on VeriSign’s Q1 earnings conference call last night.
The antitrust lawsuit is still pending, after CFIT won an appeal last June. Tenacious organization indeed.
Its domain name did not have the same longevity, however.
CFIT.info now belongs to a domainer, who appears to have picked it up last December. I offered him twenty bucks for it today and he countered with a $250 offer, which is a bit rich for me.
Whatever PageRank it accrued from all its press coverage appears to have dried up, and its parking page is not especially inspiring.
Any takers?

OpenDNS serves 1% of the internet

OpenDNS, the free DNS resolution provider, said today it has 18 million users on its books, meaning it now provides DNS for more than 1% of the world’s internet users.
The percentage is based on the estimate that there are 1.67 billion internet users.
“One percent of all of the world’s Internet users is a momentous achievement and our growth rate indicates that number will climb at an even more rapid pace going forward,” said CEO David Ulevitch.
When OpenDNS launched in 2006, I couldn’t really see the need.
But since then, the company has added services such as URL filtering, which have become popular with the 25,000-odd schools on the company’s customer roster.
Far more useful to domain-buying adults such as me and you is the company’s CacheCheck, which enables you to manually update OpenDNS’s cache of any given domain. Over the years, this has often proven to be an invaluable time saver when meddling with my domains’ DNS records.