Porn blocks could be worth millions to MMX

Minds + Machines could find itself making millions of dollars a year out of non-resolving defensive registrations in its recently acquired portfolio of porn-themed gTLDs.
The company recently announced the launch of AdultBlock and AdultBlock Plus, which will enable trademark owners to prevent anyone else registering their marks, and variants thereof, for up to 10 years.
Running the numbers, and taking into account MMX’s already substantial established client base for such services, AdultBlock could bring in as much as $11 million a year. But it’s almost certainly going to be much less than that.
The company won’t disclose it’s exact pricing for AdultBlock, or its revenue estimates, but it’s possible to do some back-of-the-envelope calculations and come to some ball-park guesses.
MMX has said that it’s pricing the service such that customers should be able to see a 35% saving compared to the cost of registering a single string across all four of its porn TLDs
The company acquired .xxx, .porn, .adult and .sex when it bought ICM Registry last year.
The wholesale fee for each of the four is believed to be about $68 a year. From this, we can calculate that the wholesale price of AdultBlock may well be around the $175-a-year mark.
There’s some room for error here, as MMX hasn’t revealed precisely how it came to its 35% number, but I think we can safely say we’re looking at $150 to $200 a year. For the purposes of this envelope, let’s split the difference and assume it’s $175.
It’s quite a high number, a bit like a recurring sunrise fee for a domain that you don’t even get to use.
But how many domains can MMX expect to be blocked?
A low-ball estimate could be modeled on the .porn/.adult/.sex sunrise periods.
.porn launched in 2015 and gathered 2,091 sunrise registrations, according to ICANN records, making it one of the largest new gTLD sunrise periods. The other two TLDs weren’t far behind.
If that’s a good guide for AdultBlock uptake, we’re talking about a piddling $360,000-a-year business.
But MMX has a secret weapon that it inherited from .xxx.
When .xxx launched back in 2011, it kicked off with two sunrise periods. Sunrise A was for trademark owners in the porn business who wanted to use their .xxx names. Sunrise B was for everyone else, who didn’t.
In Sunrise B, brand owners paid $162 (plus their registrar’s markup) to block their domains for a flat period of 10 years.
Customers couldn’t use their domains. They were registered to ICM and used specially designated ICM name servers to resolve to a standard, non-monetized placeholder page stating “This domain has been reserved from registration.”
There are over 80,000 domains using these name servers, but about 15,000 of those represent names of celebrities, cities, and religiously and culturally sensitive terms that ICM culled from Wikipedia and unilaterally reserved to help avoid a tabloid crucifixion if mileycyrus.xxx ever started bouncing children to something pornographic, such as one of her music videos.
(As an aside, I think it’s worth mentioning that the .xxx zone file only has 93,000 names in it. These means about nine out of 10 live .xxx domains are reserved by the registry.)
So we’ve got 65,000 trademarks that are currently blocked in .xxx, and they’re all going to expire in 2021 because ICM only sold blocks for the duration of its original 10-year ICANN contract.
If all 65,000 domains are upgraded to AdultBlock, the service would be worth over $11 million a year, to a company currently reporting annual revenue around $15 million.
But they won’t.
You don’t have to scroll too far down the .xxx zone file (and I didn’t) to discover some absolute garbage, no doubt the result of scaremongering around the 2011 .xxx launch.
I mean, seriously, look at some of this Sunrise B guff:

100percentwholewheatthatkidslovetoeat.xxx, 101waystoleaveagameshow.xxx, 1firstnationalmergersandacquisitions.xxx, 1stchoiceliquorsuperstore.xxx, 2bupushingalltherightbuttons.xxx, 247claimsservicethesupportyouneed30minutesguaranteed.xxx, 3pathpowerdeliverysystembypioneermagneticsinc.xxx

I think we’re going to be looking at a significant junk drop of blocked domains come 2021.
That said, I think MMX may have a psychological advantage here, when it comes to persuading Sunrise B users to “renew”.
Who hasn’t renewed a domain name they strongly suspect they will never use or sell, simply because they couldn’t bear the thought of somebody else owning “their” domain?
An additional consideration for brand owners is that these Sunrise B names are going to show up on drop-lists when they are eventually deleted from the .xxx zone file, perhaps giving inspiration to cybersquatters.
This is a fantastic opportunity for MMX and brand protection registrars to put the hard sell on its Sunrise B customers to “renew” their blocks by upgrading to the new and improved AdultBlock service, which could cost literally 10 times more than what they originally signed up for.
AdultBlock is of course more comprehensive than Sunrise B. It covers three additional TLDs, for starters, and customers can pay a little more for potentially thousands of potential homographs (non-Latin-script domains that look almost identical to the original) to also be blocked.
MMX isn’t waiting until 2021, however. It’s currently offering companies that buy a 10-year-block before the end of 2019 the AdultBlock+ service for the price of the vanilla, no-variants offering.
Existing Sunrise B customers have until the same deadline to purchase the new service without having to have their trademarks re-verified, which carries an additional fee.
For those that miss this early-bird offer, come December 2021, the holders of up 65,000 trademarks are going to face a stark choice: sign up to pay a couple hundred bucks a year, or risk their brands being snapped up by pornsquatters.

Brand-blocking service plotted for porn gTLDs

MMX wants to offer a new service for trademark owners worried about cybersquatting in its four porn-themed gTLDs.
The proposed Adult Block Services would be similar to Donuts’ groundbreaking Domain Protected Marks List and the recent Trademark Sentry offering from .CLUB Domains.
The service would enable big brands to block their marks from registration across all four TLDs for less than the price of individual defensive registrations.
Prices have not been disclosed, but a more-expensive “Plus” version would also allow the blocking of variants such as typos. The registry told ICANN:

The Adult Block Services will be offered as a chance for trademark owners to quickly and easily make labels unavailable for registration in our TLDs. For those trademark owners registering domain names as a defensive measure only, the Adult Block Services offer an easy, definitive, and cost-effective method for achieving their goals by offering at-a-stroke protection for TLDs included in the program. The Adult Block Services are similar to the Donuts’ DPML, Uniregistry’s EP and EP Plus and the .Club UNBS and should be immediately understood and accepted by the trademark community.
The Adult Block will allow trademark owners to block unregistered labels in our TLDs that directly match their trademarks. The Adult Block Plus will allow trademark owners to block unregistered, confusingly similar variations of their trademarks in our TLDs.

It seems more akin to DPML, and Uniregistry’s recently launched clone, than to .CLUB’s forthcoming single-TLD offering.
The Registry Service Evaluation Process request was filed by ICM Registry, which was acquired by MMX last year.
It only covers the four porn gTLDs that ICM originally ran, and not any of the other 22 gTLDs managed by MMX (aka Minds + Machines).
This will certainly make the service appear less attractive to the IP community than something like DPML, which covers Donuts stable of 242 TLDs.
While there’s no public data about how successful blocking services have been, anecdotally I’m told they’re quite popular.
What we do have data on is how popular the ICM gTLDs have been in sunrise periods, where trademark owners showed up in higher-than-usual numbers to defensively register their marks.
.porn, .adult and .sex garnered about 2,000 sunrise regs each, more than 20 times the average for a new gTLD, making them three of the top four most-subscribed sunrise periods.
Almost one in five of the currently registered domains in each of these TLDs is likely to be a sunrise defensive.
Now that sunrise is long gone, there may be an appetite in the trademark community for less-expensive blocks.
But there have been calls for the industry to unify and offer blocking services to cover all gTLDs.
The brand-protection registrar Com Laude recently wrote:

What brands really need is for registry operators to come together and offer a universal, truly global block that applies across all the open registries and at a reasonable price that a trademark owner with multiple brands can afford.

Quite how that would happen across over 1,200 gTLDs is a bit of a mystery, unless ICANN forced such a service upon them.

ICA rallies the troops to defeat .org price hikes. It won’t work

Over 100 letters have been sent to ICANN opposing the proposed lifting of price caps in .org, after the Internet Commerce Association reached out to rally its supporters.
This is an atypically large response to an ICANN public comment period, and there are four days left on the clock for more submissions to be made, but I doubt it will change ICANN’s mind.
Almost all of the 131 comments filed so far this month were submitted in the 24 hours after ICA published its comment submission form earlier this week.
About a third of the comments comprise simply the unedited ICA text. Others appeared to have been inspired by the campaign to write their own complaints about the proposal, which would scrap the 10%-a-year .org price increase cap Public Interest Registry currently has in place.
Zak Muscovitch, ICA’s general counsel, told DI that as of this morning the form generates different template text dynamically. I’ve spotted at least four completely different versions of the letter just by refreshing the page. This may make some comments appear to be the original thoughts of their senders.
This is the original text, as it relates to price caps:

I believe that legacy gTLDs are fundamentally different from for-profit new gTLDs. Legacy TLDs are essentially a public trust, unlike new gTLDs which were created, bought and paid for by private interests. Registrants of legacy TLDs are entitled to price stability and predictability, and should not be subject to price increases with no maximums. Unlike new gTLDs, registrants of legacy TLDs registered their names and made their online presence on legacy TLDs on the basis that price caps would continue to exist.
Unrestrained price increases on the millions of .org registrants who are not-for-profits or non-profits would be unfair to them. Unchecked price increases have the potential to result in hundreds of millions of dollars being transferred from these organizations to one non-profit, the Internet Society, with .org registrants receiving no benefit in return. ICANN should not allow one non-profit nearly unlimited access to the funds of other non-profits.

The gist of the other texts is the same — it’s not fair to lift price caps on domains largely used by non-profits that may have budget struggles and which have built their online presences on the old, predictable pricing rules.
The issues raised are probably fair, to a point.
Should the true “legacy” gTLDs — .com, .net and .org — which date from the 1980s and pose very little commercial risk to their registries, be treated the same as the exceptionally risky gTLD businesses that have been launched since?
Does changing the pricing rules amount to unfairly moving the goal posts for millions of registrants who have built their business on the legacy rules?
These are good, valid questions.
But I think it’s unlikely that the ICA’s campaign will get ICANN to change its mind. The opposition would have to be broader than from a single interest group.
First, the message about non-profits rings a bit hollow coming from an explicitly commercial organization whose members’ business model entails flipping domain names for large multiples.
If a non-profit can’t afford an extra 10 bucks a year for a .org renewal, can it afford the hundreds or thousands of dollars a domainer would charge for a transfer?
Even if PIR goes nuts, abandons its “public interest” mantra, and immediately significantly increases its prices, the retail price of a .org (currently around $20 at GoDaddy, which has about a third of all .orgs) would be unlikely to rise to above the price of PIR-owned .ong and .ngo domains, which sell for $32 to $50 retail.
Such an increase might adversely affect a small number of very low-budget registrants, but the biggest impact will be felt by the big for-profit portfolio owners: domainers.
Second, letter-writing campaigns don’t have a strong track record of persuading ICANN to change course.
The largest such campaign to date was organized by registrars in 2015 in response to proposals, made by members of the Privacy and Proxy Services Accreditation Issues working group, that would have would have essentially banned Whois privacy for commercial web sites.
Over 20,000 people signed petitions or sent semi-automated comments opposing that recommendation, and ICANN ended up not approving that specific proposal.
But the commercial web site privacy ban was a minority position written by IP lawyers, included as an addendum to the group’s recommendations, and it did not receive the consensus of the PPSAI working group.
In other words, ICANN almost certainly would not have implemented it anyway, due to lack of consensus, even if the public comment period had been silent.
The second-largest public comment period concerned the possible approval of .xxx in 2010, which attracted almost 14,000 semi-automated comments from members of American Christian-right groups and pornographers.
.xxx was nevertheless approved less than a year later.
ICANN also has a track record of not acceding to ICA’s demands when it comes to changes in registry agreements for pre-2012 gTLDs.
ICA, under former GC Phil Corwin, has also strongly objected to similar changes in .mobi, .jobs, .cat, .xxx and .travel over the last few years, and had no impact.
ICANN seems hell-bent on normalizing its gTLD contracts to the greatest extent possible. It’s also currently proposing to lift the price caps on .biz and .info.
This, through force of precedent codified in the contracts, could lead to the price caps one day, many years from now, being lifted on .com.
Which, let’s face it, is what most people really care about.
Info on the .org contract renewal public comment period can be found here.

.london disaster leads to mixed 2018 for MMX

New gTLD registry MMX, aka Minds + Machines, suffered a huge net loss in 2018, largely due to its disastrous .london contract, even while its operating fundamentals improved.
For the year, MMX reported a net loss of $12.6 million, compared to a 2017 profits of $3.8 million, on revenue up 5% to $15.1 million.
The loss was almost entirely attributable to charges related to an “onerous contract” with one of its partners.
MMX has never disclosed the identity of this partner, but the only outfit that fits the profile is London & Partners, the agency with which MMX partnered to launch .london several years ago.
The registry, expecting big things from the geo-TLD, promised to pay L&P millions over the term of the contract, which expires in 2021.
But it’s been a bit of a damp squib compared to former management’s expectations, peaking at about 86,000 regs last year and shrinking ever since.
MMX says the estimated gap between the minimum revenue guarantee payable to L&P and the expected revenue is expected to bring in before 2021, is $7.2 million.
It’s recorded this as a charge on its income statement accordingly, along with another $4.2 million impairment charge related to the same contract.
The company recorded a $7.7 million accounting charge related to this contract in 2016, too.
The company says that to date it has lost about $13.7 million on the deal.
These charges, along with a few other smaller one-off expenses, were enough to push the company into the black for 2018.
But other key performance indicators showed more promise, helped along by the acquisition last year of porn-themed registry operator ICM Register, best-known for .xxx.
Notably, renewal revenue almost doubled, up 97% to $9.4 million.
Domains under management was up 37% to 1.81 million.
Operating EBITDA was $3.6 million, up 12.5%.
Looking ahead, MMX said billings for the first quarter are expected to be up 246%, due to the first impact of the ICM acquisition.
It also said it closed $500,000 of sales in .law in China in March. That would work out to over 5,000 domains, based on the retail price of about $100 a year, but those domains have yet to show up in the .law zone file, which only grew by about 200 domains last month.
MMX said it is planning to launch “a high-value defensive registration product” for corporate registrars by the third quarter.
If I had to guess, I’d say that is probably a clone of Donuts’ Domain Protected Marks List service, which offers trademark owners deep discounts when they defensively block strings across the whole Donuts gTLD portfolio.
It’s a model copied by other registries, including recently Uniregistry.

Will ICANN take a bigger slice of the .com pie, or will .domainers get URS?

Will ICANN try to get its paws on some of Verisign’s .com windfall? Or might domainers get a second slap in the face by seeing URS imposed in .com?
With Verisign set to receive hundreds of millions of extra dollars due to the imminent lifting of .com price caps, it’s been suggested that ICANN may also financially benefit from the arrangement.
In a couple of blog posts Friday, filthy domain scalper Andrew Allemann said that ICANN will likely demand higher fees from Verisign in the new .com registry agreement.
Will it though? I guess it’s not impossible, but I wouldn’t say it’s a certainty by any means.
Verisign currently pays ICANN $0.25 per transaction, the same as almost all other gTLDs. Technically, there’s no reason this could not be renegotiated.
Putting aside some of the legacy gTLD contracts, I can only think of two significant cases of ICANN imposing higher fees on a registry.
The first was .xxx, which was signed in 2011. That called for ICM Registry, now part of MMX, to pay $2 per transaction, eight times the norm.
The rationale for this was that ICANN thought (or at least said it thought) that .xxx was going to be a legal and compliance minefield. It said it envisaged higher costs for overseeing the then-controversial TLD.
There was a school of thought that ICANN was just interested in opportunistically boosting its own coffers, given that ICM was due to charge over $60 per domain per year — at the time a ludicrously high amount.
But risk largely failed to materialize, and the two parties last year renegotiated the fees down to $0.25.
The second instance was .sucks, another controversial TLD. In that case, ICANN charged registry Vox Populi a $100,000 upfront fee and per-transaction fees of $1 per domain for the first 900,000 transactions, four times more than the norm.
While some saw this as a repeat of the .xxx legal arse-covering tactic, ICANN said it was actually in place to recoup a bunch of money that Vox Pop owner Momentous still owed when it let a bunch of its drop-catch registrars go out of business a couple years earlier.
While the .sucks example clearly doesn’t apply to Verisign, one could make the case that the .xxx example might.
It’s possible, I guess, that ICANN could make the case that Verisign’s newly regained ability to raise prices opens it up to litigation risk — something I reckon is certainly true — and that it needs to increase its fees to cover that risk.
It might be tempting. ICANN has a bit of a budget crunch at the moment, and a bottomless cash pit like Verisign would be an easy source of funds. A transaction fee increase of four cents would have been enough to cover the $5 million budget shortfall it had to deal with earlier this year.
On the other hand, it could be argued that ICANN demanding more money from Verisign would unlevel the playing field, inviting endless litigation from Verisign itself.
ICANN’s track record with legacy gTLDs has been to reduce, rather than increase, their transaction fees.
Pre-2012 gTLDs such as .mobi, .jobs, .cat and .travel have all seen their fees reduced to the $0.25 baseline in recent years, sometimes from as high as $2.
In each of these cases, the registries concerned had to adopt many provisions of the standard 2012 new gTLD registry agreement including, controversially, the Uniform Rapid Suspension service.
Domainers hate the URS, which gives trademark owners greater powers to take away their domains, and the Internet Commerce Association (under the previous stewardship of general counsel Phil Corwin, since hired by Verisign) unsuccessfully fought against URS being added to .mobi et al over the last several years, on the basis that eventually it could worm its way into .com.
I’m not suggesting for a moment that ICANN might reduce Verisign’s fees, but what if URS is the price the registry has to pay for its massive .com windfall?
It’s not as if Verisign has any love for domainers, despite the substantial contribution they make to its top line.
Since the NTIA deal was announced, it’s already calling them “scalpers” and driving them crazy.
ICA lost the .com price freeze fight last week, could it also be about to lose the URS fight?

More consolidation? Endurance said to be up for sale

Endurance International Group is reportedly up for sale, perhaps the next piece of consolidation or privatization in a rapidly changing domain name market.
Bloomberg, citing unnamed sources, reports today that EIG is “is considering strategic options, including a possible sale”.
EIG owns domain brands Domain.com, BigRock, BuyDomains and ResellerClub, along with a bunch of hosting properties such as HostGator.
Bloomberg’s sources stressed that no final decision has been made, and that the company could remain public.
It’s currently listed on Nasdaq where it has a market cap today of almost $1.38 billion .
The company would be far from the first to change ownership in the last couple of years.
Most recently, Web.com (Network Solutions et al) announced a plan to go private in a $2 billion deal.
A year ago, Neustar went private in a $2.9 billion deal.
In terms of industry consolidation, we’ve more recently seen KeyDrive reverse into CentralNic and MMX buy ICM Registry.

After ICANN nod, MMX buys .xxx

MMX has closed the acquisition of porn-focused ICM Registry, after receiving the all-clear from ICANN for the contract transfers.
The deal is worth roughly $41 million — $10 million cash and about $31 million in stock.
ICM runs .xxx from the 2003 gTLD application round (though it didn’t go live until 2011) and .porn, .adult and .sex from the 2012 round.
MMX, which now has 29 fully-owned TLDs and another five in partnerships, will now become roughly a quarter-owned by former ICM employees and its back-end provider, Afilias.
ICM president Stuart Lawley now owns 15% of MMX and is its largest shareholder.
CEO Toby Hall said in a statement to the markets that he has “identified a number areas of potential growth and synergy”.
The company noted that the deal increases the share of its revenue coming from the US and Europe, implicitly highlighting the reduction of its exposure to the volatile Chinese market, where .vip has been its biggest money-spinner to date.
ICM had something like 152,000 .xxx domains under management at the last count, but over 80,000 of those are reservations. It has about 92,000 names in its zone file currently.
The three 2012-round names are faring less well, with about 8,000 to 10,000 names apiece in their zones.
Somebody once jokingly told me that ICM stood for “Internet Cash Machine”, due to the perception that porn-focused names would sell like, well, porn. Just thought I’d mention that.

MMX rejected three takeover bids before buying .xxx

MMX talked to three other domain name companies about potentially selling itself before deciding instead to go on the offensive, picking up ICM Registry for about $41 million.
The company came out of a year-long strategic review on Friday with the shock news that it had agreed to buy the .xxx, .adult, .porn and .sex registry, for $10 million cash and about $31 million in stock.
CEO Toby Hall told DI today that informal talks about MMX being sold or merged via reverse takeover had gone on with numerous companies over the last 11 months, but that they only proceeded to formal negotiations in three cases.
Hall said he’d been chatting to ICM president and majority owner Stuart Lawley about a possible combination for over two years.
ICM itself talked to four potential buyers before going with MMX’s offer, according to ICM.
Lawley, who’s quitting the company, will become MMX’s largest shareholder following the deal, with about 15% of the company’s shares. Five other senior managers, as well as ICM investor and back-end provider Afilias, will also get stock.
Combined, ICM-related entities will own roughly a quarter of MMX after the deal closes, Hall said.
ICM, with its high-price domains and pre-2012 early-mover advantage, is the much more profitable company.
It had sales of $7.3 million and net income of $3.5 million in 2017, on approximately 100,000 registrations.
Compared to MMX, that’s about the same amount of profit on about half the revenue. It just reported 2017 profit of $3.8 million on revenue of $14.3 million.
There’s doesn’t seem to be much need or desire to start swinging the cost-cutting axe at ICM, in other words. Jobs appear safe.
“This isn’t a business in any way that is in need of restructuring,” Hall said.
He added that he has no plans to ditch Afilias as back-end registry provider for the four gTLDs. MMX’s default back-end for the years since it ditched its self-hosted infrastructure has been Nominet.
The deal reduces MMX’s exposure to the volatile Chinese market, where its .vip TLD has proved popular, accounting for over half of the registry’s domains under management.
It also gives MMX ownership of ICM’s potentially lucrative portfolio of reserved premium names.
There are over 9,700 of these, with a combined buy-now price of just shy of $135 million.
I asked Hall whether he had any plans to get these names sold. He laughed, said “the answer is yes”, and declined to elaborate.
ICM currently has a sales staff of three people, he said.
“It’s a small team, but their track record is exceptional,” he said.
The company’s record, I believe, is sex.xxx, which sold for $3 million. It has many six-figure sales on record. Premiums renew at standard reg fee, around $60.
With the ICM deal, MMX has recast itself after a year of uncertainty as an acquirer rather than an acquisition target.
While many observers — including yours truly — had assumed a sale or merger were on the cards, MMX has gone the other route instead.
It’s secured a $3 million line of credit from its current largest shareholder, London and Capital Asset Management Ltd, “to support future innovation and acquisition orientated activity”.
That’s not a hell of a lot of money to run around snapping up rival gTLDs, but Hall said that it showed that investors are supportive of MMX’s new strategy.
So does this mean MMX is going to start devouring failing gTLDs for peanuts? Not necessarily, but Hall wouldn’t rule anything out.
“Our long-term strategy is ultimately based around being an annuity-based business,” he said. He’s looking at companies with a “strong recurring revenue model”.
About 78% of ICM’s revenue last year came from domain renewals. The remainder was premium sales. For MMX, renewal revenue doubled to $4.8 million in 2017, but that’s still only a third of its overall revenue (though MMX is of course a less-mature business).
So while Hall refused to rule out looking at buying up “struggling” gTLDs, I get the impression he’s not particularly interested in taking risks on unproven strings.
“You can never say never to any opportunity,” he said. “If we come across and asset and for whatever reason we believe we can monetize it, it could become an acquisition target.”
The acquisition is dependent on ICANN approving the handover of registry contracts, something that doesn’t usually present a problem in this kind of M&A.

ICANN flips off governments over Whois privacy

ICANN has formally extended its middle finger to its Governmental Advisory Committee for only the third time, telling the GAC that it cannot comply with its advice on Whois privacy.
It’s triggered a clause in its bylaws used to force both parties to the table for urgent talks, first used when ICANN clashed with the GAC on approving .xxx back in 2010.
The ICANN board of directors has decided that it cannot accept nine of the 10 bulleted items of formal advice on compliance with the General Data Protection Regulation that the GAC provided after its meetings in Puerto Rico in March.
Among that advice is a direction that public Whois records should continue to contain the email address of the registrant after GDPR goes into effect May 25, and that parties with a “legitimate purpose” in Whois data should continue to get access.
Of the 10 pieces of advice, ICANN proposes kicking eight of them down the road to be dealt with at a later date.
It’s given the GAC a face-saving way to back away from these items by clarifying that they refer not to the “interim” Whois model likely to come into effect at the GDPR deadline, but to the “ultimate” model that could come into effect a year later after the ICANN community’s got its shit together.
Attempting to retcon GAC advice is not unusual when ICANN disagrees with its governments, but this time at least it’s being up-front about it.
ICANN chair Cherine Chalaby told GAC chair Manal Ismail:

Reaching a common understanding of the GAC’s advice in relation to the Interim Model (May 25) versus the Ultimate Model would greatly assist the Board’s deliberations on the GAC’s advice.

Of the remaining two items of advice, ICANN agrees with one and proposes immediate talks on the other.
One item, concerning the deployment of a Temporary Policy to enforce a uniform Whois on an emergency basis, ICANN says it can accept immediately. Indeed, the Temporary Policy route we first reported on a month ago now appears to be a done deal.
ICANN has asked the GAC for a teleconference this week to discuss the remaining item, which is:

Ensure continued access to the WHOIS, including non-public data, for users with a legitimate purpose, until the time when the interim WHOIS model is fully operational, on a mandatory basis for all contracted parties;

Basically, the GAC is trying to prevent the juicier bits of Whois from going dark for everyone, including the likes of law enforcement and trademark lawyers, two weeks from now.
The problem here is that while ICANN has tacit agreement from European data protection authorities that a tiered-access, accreditation-based model is probably a good idea, no such system currently exists and until very recently it’s not been something in which ICANN has invested a lot of focus.
A hundred or so members of the ICANN community, led by IP lawyers who won’t take no for an answer, are currently working off-the-books on an interim accreditation model that could feasibly be used, but it is still subject to substantial debate.
In any event, it would be basically impossible for any agreed-upon accreditation solution to be implemented across the industry before May 25.
So ICANN has invoked its bylaws fuck-you powers for only the third time in its history.
The first time was when the GAC opposed .xxx for reasons lost in the mists of time back in 2010. The second was in 2014 when the GAC overstepped its powers and told ICANN to ignore the rest of the community on the issue of Red Cross related domains.
The board resolved at a meeting last Thursday:

the Board has determined that it may take an action that is not consistent or may not be consistent with the GAC’s advice in the San Juan Communiqué concerning the GDPR and ICANN’s proposed Interim GDPR Compliance Model, and hereby initiates the required Board-GAC Bylaws Consultation Process required in such an event. The Board will provide written notice to the GAC to initiate the process as required by the Bylaws Consultation Process.

Chalaby asked Ismail (pdf) for a call this week. I don’t know if that call has yet taken place, but given the short notice I expect it has not.
For the record, here’s the GAC’s GDPR advice from its Puerto Rico communique (pdf).

the GAC advises the ICANN Board to instruct the ICANN Organization to:
i. Ensure that the proposed interim model maintains current WHOIS requirements to the fullest extent possible;
ii. Provide a detailed rationale for the choices made in the interim model, explaining their necessity and proportionality in relation to the legitimate purposes identified;
iii. In particular, reconsider the proposal to hide the registrant email address as this may not be proportionate in view of the significant negative impact on law enforcement, cybersecurity and rights protection;
iv. Distinguish between legal and natural persons, allowing for public access to WHOIS data of legal entities, which are not in the remit of the GDPR;
v. Ensure continued access to the WHOIS, including non-public data, for users with a legitimate purpose, until the time when the interim WHOIS model is fully operational, on a mandatory basis for all contracted parties;
vi. Ensure that limitations in terms of query volume envisaged under an accreditation program balance realistic investigatory crossreferencing needs; and
vii. Ensure confidentiality of WHOIS queries by law enforcement agencies.
b. the GAC advises the ICANN Board to instruct the ICANN Organization to:
i. Complete the interim model as swiftly as possible, taking into account the advice above. Once the model is finalized, the GAC will complement ICANN’s outreach to the Article 29 Working Party, inviting them to provide their views;
ii. Consider the use of Temporary Policies and/or Special Amendments to ICANN’s standard Registry and Registrar contracts to mandate implementation of an interim model and a temporary access mechanism; and
iii. Assist in informing other national governments not represented in the GAC of the opportunity for individual governments, if they wish to do so, to provide information to ICANN on governmental users to ensure continued access to WHOIS.

.xxx has its ICANN fees slashed and adopts URS

ICM Registry is to see its .xxx ICANN registry fees hugely reduced in contractual amendments approved by ICANN last week.
The changes also mean that .xxx will now become subject to the Uniform Rapid Suspension anti-cybersquatting mechanism, despite it being a pre-2012 gTLD.
.xxx becomes the latest pre-2012 gTLD to move to a contract more closely aligned with the standard Registry Agreement from the new gTLD program.
Under the complex new deal, its per-transaction fee could be reduced from $2 to $0.25 by mid-2018.
Its quarterly fixed fee will go up from $2,500 to $6,250.
ICM has also agreed to take on many aspects of the standard new gTLD Registry Agreement, the most controversial of which is the URS.
The domainer group the Internet Commerce Association was fiercely critical of this addition to the contract, as it has been when URS was brought to .jobs, .travel, .cat, .pro and .mobi.
ICA is largely concerned that URS will also be pushed upon Verisign’s .net, which is up for contract renewal this year, and eventually .com.