New gTLD program thrown into chaos as ICANN loses .africa case

ICANN has been opened up to a world of hurt after an independent panel of judges ruled that the organization broke its own bylaws when it kicked DotConnectAfrica’s .africa bid out of the new gTLD program.
The what-the-fuck ruling cuts to the very heart of how ICANN deals with advice from its Governmental Advisory Committee, which comes out of the case looking like a loose canon with far too much power to sway the ICANN board.
Witness testimony published in the panel’s opinion sheds humiliating light on the GAC’s self-defeating habit of supplying ICANN with deliberately vague advice, a practice described by its former chair under oath as “creative ambiguity”.
The ruling does not, however, give DCA a serious shot at winning the .africa gTLD, which has already been contracted to rival ZA Central Registry. More delay is, however, inevitable.
The Independent Review Panel said:

the Panel is of the unanimous view that certain actions and inactions of the ICANN Board (as described below) with respect to the application of DCA Trust relating to the .AFRICA gTLD were inconsistent with the Articles of Incorporation and Bylaws of ICANN.

It also unanimously ruled that ICANN should un-reject DCA’s application and allow it to continue through the application process and that ICANN should bear the full $600,000+ cost of the IRP, not including DCA’s legal fees.
It’s an important ruling, especially coming as ICANN seeks to extricate itself from US government oversight, because it implicitly calls on ICANN’s board to treat GAC advice with much less deference.
What’s the backstory?
DCA and ZACR have competing applications for .africa, which is a protected geographic string.
Under new gTLD program rules, only an applicant with support from over 60% of African national governments can be approved. ZACR’s support far exceeds this threshold, whereas DCA enjoys little to no government support at all.
The ICANN board’s New gTLD Program Committee rejected the DCA bid in June 2013, before its Initial Evaluation (which includes the Geographic Names Review) had been completed, based on the GAC’s April 2013 Beijing communique advice.
That advice invoked the GAC’s controversial (and vaguely worded) powers to recommend against approval of any application for any reason, as enshrined in the Applicant Guidebook.
A subsequent Request for Reconsideration (IRP lite) filed by DCA was rejected by ICANN’s Board Governance Committee.
An IRP is the last avenue community members have to challenge ICANN’s actions or inaction without resorting to the courts.
DCA filed its IRP complaint in October 2013 and amended it in January 2014, claiming ICANN broke its own bylaws by rejecting the DCA application based on GAC advice.
Despite the IRP, ICANN went ahead and signed a Registry Agreement with rival ZACR in the May and was just days away from delegating .africa when the IRP panel ordered the process frozen.
The case dragged on, partly because one of the original three-person panel died and had to be replaced, the delay causing much consternation among African GAC members.
What did the IRP panel finally rule?
Yesterday’s ruling avoided deciding on or even commenting on any of DCA’s crazy conspiracy theories, instead limiting itself to the question of whether ICANN’s board and committees acted with bylaws-mandated transparency, fairness and neutrality.
It found that the GAC itself did not act according to these principles when it issued its Beijing advice against DCA.
It found that ICANN did not “conduct adequate diligence” when it accepted the advice, nor did the BGC or NGPC when they were processing the RfR.

In light of the clear “Transparency” obligation provisions found in ICANN’s Bylaws, the Panel would have expected the ICANN Board to, at a minimum, investigate the matter further before rejecting DCA Trust’s application.

ICANN did not do that, the panel decided, so it broke its bylaws.

both the actions and inactions of the Board with respect to the application of DCA Trust relating to the .AFRICA gTLD were not procedures designed to insure the fairness required… and are therefore inconsistent with the Articles of Incorporation and Bylaws of ICANN.

Does this mean DCA gets .africa?
No. The IRP panel ruled that DCA’s application must re-enter the application process, presumably at the point it exited it.
DCA’s application never had a final Initial Evaluation result issued. If it were to re-enter IE today, it would certainly be failed by the Geographic Names Panel because it lacks the requisite support of 60% of African governments.
DCA wanted the panel to rule that it should have 18 months to try to secure the needed support, but the panel refused to do so.
The application is still as good as dead, but ICANN will need to go through the motions to actually bury it.
In the meantime, ZACR’s delayed delegation of .africa is to remain on hold.
How embarrassing is this for the GAC?
Hugely. Verbal testimony from Heather Dryden, who was GAC chair at the time of the Beijing meeting, highlights what I’ve been saying for years: GAC advice is regularly so vaguely written as to be useless, inconsistent, or even harmful.
Dryden told the panel at one point: “In our business, we talk about creative ambiguity. We leave things unclear so we don’t have conflict.”
The IRP panel took a dim view of Dryden’s testimony, writing that she “acknowledged during the hearing, the GAC did not act with transparency or in a manner designed to insure fairness.”
The ruling quotes large chunks of text from the hearing, during which Dryden was grilled about the GAC’s rationale for issuing a consensus recommendation against DCA.
Dryden responded by essentially saying that the GAC did not discuss a rationale, and that there was “deference” to the governments proposing consensus objections in that regard.

ARBITRATOR KESSEDJIAN: So, basically, you’re telling us that the GAC takes a decision to object to an applicant, and no reasons, no rationale, no discussion of the concepts that are in the rules?
[DRYDEN]: I’m telling you the GAC did not provide a rationale. And that was not a requirement for issuing a GAC —
HONORABLE JUDGE CAHILL: But you also want to check to see if the countries are following the right — following the rules, if there are reasons for rejecting this or it falls within the three things that my colleague’s talking about.
[DRYDEN]: The practice among governments is that governments can express their view, whatever it may be. And so there’s a deference to that. That’s certainly the case here as well.

This and other quoted sections of the hearing depict the GAC as a body that deliberately avoids substantive discussions and deliberately provides unclear advice to ICANN, in order to avoid offending its members.
Does this mean all GAC advice on new gTLDs is open to appeal now?
Maybe. There are numerous instances of the ICANN board accepting GAC advice without demanding an explanation from the GAC.
At a bare minimum, the applicant for .gcc, which was rejected in the same breath as .africa, now seems to have a case to appeal the decision. The applicant for .thai is in a very similar situation.
Amazon’s lawyers will no doubt also be poring over yesterday’s decision closely; its .amazon bid was also killed off by GAC advice.
But in the case of .amazon, it would be hard to argue it was a .africa-style summary execution. ICANN took extensive advice and delayed its decision for a long time before killing off that application.
The ruling essentially calls the part of the Applicant Guidebook that gives the GAC its strong advisory powers over new gTLD applications into question.
Literally hundreds of new gTLD applications were affected by the Beijing communique.
Anything else of note?
Yes.
First, large parts of the decision have been redacted. The redactions mostly appear to relate to sensitive documents disclosed between the parties (reading between the lines, I think some of them related to DCA’s purported support from a certain African government) that the panel ruled should remain private last September.
Second, the decision inexplicably quotes the ICANN bylaws text “MISSION AND CORE VALUES” as “MISSION AND CORE (Council of Registrars) VALUES”, in what appears to be a weird search-and-replace error by an unknown party. CORE (Council of Registrars) is of course a registry back-end provider with apparently no involvement in .africa whatsoever.
Third, it seems I’ve been elected Pope. I hereby select “Dave” as my Papal name and will commence my program of donating all Church assets to the poor forthwith.

.cruise heading to auction despite “closed generic” protest

Ownership of the contested gTLD .cruise will be resolved by auction, despite protests from one applicant that the other left it too late to drop its “closed generic” plans.
Applications from Cruise Lines International Association and Viking River Cruises were both placed in “In Auction” status by ICANN overnight.
Both original applications had been to operate .cruise for the registry’s own exclusive use, a so-called closed generic bid.
However, following objections from its Governmental Advisory Committee in April 2013, ICANN eventually decided to disallow such applications.
CLIA changed its plans in September 2013 as a result of the GAC advice.
But it wasn’t until mid-June this year, around about the same time as ICANN was mulling its final determination on the matter, that Viking changed its application to remove the exclusive access bits.
This prompted an angry response from CLIA.
In a letter to ICANN last month (pdf) the group accused Viking of waiting too long to change its application and said it should be given a chance to formally object.
CLIA further accused Viking of deliberately delaying the .cruise contention set so its own dot-brand, .viking, could get a head-start. The .viking gTLD is contracted and currently in pre-delegation testing.
ICANN dismissed CLIA’s request, however, saying that applicants can amend their applications at any time and that there are no plans to reopen the objection filing period for one special case.
The gTLD now seems set to head to an ICANN auction or private settlement between the two parties.

Slacker dot-brands get ICANN reprieve

Wannabe dot-brands that dawdled and lost the chance to sign a new gTLD registry agreement with ICANN have been given a second shot.
ICANN yesterday introduced a new Application Eligibility Reinstatement process that will enable applicants to change their application status from the dead end of “Will Not Proceed”.
To demonstrate they really are committed to signing a contract, eligible applicants will have to submit a tonne of information about things such as their failure bond, pre- and post-delegation technical plans and registrar onboarding.
As we reported back in January, there were 12 applications belonging to 10 applicants that had simply drifted into limbo for failing to sign a contract by their respective deadlines.
There are 45 applications in “Will Not Proceed” status, but only the ones that timed out in contracting are eligible for the new process, obviously.

Chinese registrar goes AWOL, gets terminated

Chinese registrar name2host.com has had its accreditation terminated by ICANN for failing to comply with an audit.
According to the compliance notice (pdf), ICANN has been chasing the company since March but has encountered only disconnected phones and unanswered emails.
It seems name2host.com’s principals were all using Hotmail or Yahoo email accounts; not exactly the kind of thing you want to see from a domain name registrar.
The registrar had fewer than 5,000 gTLD domains on its books in March, all in .com and .net.
ICANN will initiate a bulk transfer to a new registrar using its usual process.

There are now over 1,000 top-level domains

The number of top-level domains on the internet has topped 1,000 for the first time.
The delegation of seven new gTLDs today — .studio, .live, .jprs, .game, .bcn, .barcelona and .airtel — took the total number of TLDs in the DNS root zone to 1,002.
The DI database breaks the count down like this:

• 693 are new gTLDs from the 2012 application round.
• 286 are ccTLDs.
• 15 are gTLDs delegated by ICANN in earlier rounds.
• Eight are the original gTLDs created in the 1980s.

The vast majority of the TLDs are in Latin script. Just 91, a mixture of ccTLDs and gTLDs, are internationalized domain names.
It’s been 623 days since the first 2012-round new gTLD was delegated, meaning the root is growing by an average of 1.1 TLDs per day.

Afilias wants to buy your failed gTLD

Afilias is on an overt campaign to snap up struggling new gTLDs at bargain basement prices.
“In the neighborhood of a dozen” gTLD operators responded seriously to Afilias’ booth at last month’s ICANN meeting in Buenos Aries, (pictured), Afilias chief marketing officer Roland LaPlante told DI in an interview today.
The company could potentially buy up tens of gTLDs over the coming year, LaPlante said.
“If all of these 500 strings with less than 5,000 names in them start looking for a new owner, it’s going to be a pretty active marketplace,” he said.

“There are entrants in the market who either have found the market is not as they expected, or results are not what they need, or for whatever other reason they’re coming to the conclusion this isn’t the business they should be in and they’re looking for options,” LaPlante said.
“There’s been a cold splash of water in the face for a lot of people who didn’t expect it, they’re struggling with relatively low revenues compared to what they might have expected,” he said. “They’re likely to be looking for options.”
Afilias would be happy to take these contracts off their current owners’ hands, for the right price.
“Frankly, we’re not going to be paying huge prices for them,” LaPlante.
“We’ve run into a number of folks who still have fairly inflated opinions of what their string is worth,” he said. “Some of these strings are attractive, but they’re going to need a lot more time to mature.”
Afilias believes that the economies of scale it already has in place would enable it to turn a profit at a much lower registration volume, perhaps under 50,000 names, and that it has the patience and financial strength to wait for its acquisitions to hit those volumes.
“We’re very conservative in our volume estimates,” LaPlante said.
Afilias currently has 26 new gTLDs as back-end and 13 as contracted registry operator.
The company is basically looking for acquisitions where the seller’s looming alternative might be the Emergency Back-End Registry Operator, and where the fees associated with an auction might be a bit too rich.
While LaPlante jokingly compared the proposition to the “We Buy Any Car” business model, he admitted that some registries are less attractive than others.
gTLDs with a lot of restrictions or monitoring would be treated with much more caution — Afilias was not interested in .hiv, which failed to sell at auction recently, for example — and would be skeptical about registries that have given away large numbers of free domains.
“We’d like to pick up strings that have good potential for a profitable amount of volume,” he said.
Afilias quietly sold .meet to Google earlier this year, but LaPlante denied that Afilias is in the business of flipping gTLDs. While he could not get into details, he said the .meet deal was a “special case”.
As we discovered last week, at least eight new gTLDs have changed ownership since signing their registry contracts. A few others have been acquired pre-contracting.

Whois privacy supporters to top 20,000

Over 20,000 people have put their names to statements slamming proposals that would ban some commercial web sites from using Whois privacy on their domains.
ICANN’s public comment period on a working group’s Whois privacy reform proposals closes today after two months, with roughly 11,000 individual comments — the vast majority against changes that would weaken privacy rights — already filed.
Separately, Michele Neylon of Blacknight Solutions, which hosts SaveDomainPrivacy.org, tells DI that a petition signed by more than 9,000 people will be submitted to ICANN tonight.
If we count the signatories as commenters, that would make this the largest ICANN comment period to date, outstripping the 14,000 comments received when religious groups objected to the approval of .xxx in 2010.
SaveDomainPrivacy.org and RespectOurPrivacy.org, separate registrar-led initiatives, are responsible for the large majority of comments.
While registrars no doubt have business reasons for objecting to the muddling the Whois privacy market, their letter-writing outreach has been based on their claims that they could be forced to unmask the Whois of vulnerable home-business owners and such.
The Privacy & Proxy Services Accreditation Issues Working Group (PPSAI) report, published in May, sketches out a framework that could allow intellectual property owners to have privacy removed from domains they suspect of hosting infringing content.
A minority position appended to the report by MarkMonitor, Facebook, LegitScript and supported by members of the Intellectual Property and Business Constituencies, would put a blanket ban on using privacy on domains used to commercially transact.

ICANN dragged into Gamergate as Whois reform cast as misogynist threat

What do ICANN’s current Whois privacy reform proposals have to do with the “Gamergate” controversy?
Quite a lot, according to the latest group to slam the proposals as an enabler for “doxing… harassment… swatting… stalking… rape and death threats.”
The Online Abuse Prevention Initiative was formed in March by female software developers in the wake of a sexism slash online abuse scandal that continues to divide the video game community.
Led by Randi Harper, OAPI’s first public move was to today write to ICANN to complain about the GNSO Privacy & Proxy Services Accreditation Issues (PPSAI) Working Group Initial Report.
The report, as previously reported, contains a minority opinion that would ban transactional e-commerce sites from using Whois privacy services.
OAPI said today that this posed a risk of “doxing” — the practice of publishing the home address and other personal information about someone with the aim to encourage harassment — and “swatting”, where people call up America’s notoriously trigger-happy cops to report violent crimes at their intended victim’s home address.
Harper, who was one of the targets of the Gamergate movement (Google her for examples of the vitriol) claims to have been a victim of both. The OAPI letter says she “was swatted based on information obtained from the WHOIS record for her domain.”
The letter, which is signed by groups including the Electronic Frontier Foundation, the National Network to End Domestic Violence, the National Council of Women’s Organizations, and dozens of noted digital rights voices, says:

We strongly oppose the Working Group’s proposal, which will physically endanger many domain owners and disproportionately impact those who come from marginalized communities. People perceived to be women, nonwhite, or LGBTQ are often targeted for harassment, and such harassment inflicts significant harm
…
Even the most limited definition of a “website handling online financial transactions for commercial purpose” will encompass a wide population that could be severely harmed by doxing, such as:

• women indie game developers who sell products through their own online stores
• freelance journalists and authors who market their work online
• small business owners who run stores or businesses from their homes
• activists who take donations to fund their work, especially those living under totalitarian regimes
• people who share personal stories online to crowdfund medical procedures

To make things worse, the proposed definition of what constitutes “commercial purpose” could be expanded to include other types of activity such as running ads or posting affiliate links.

The letter does not directly refer to Gamergate, but some of the signatories are its most prominent victims and the allusions are clearly there.
Gamergate is described somewhere in its 9,000-word Wikipedia article as “part of a long-running culture war against efforts to diversify the traditionally male video gaming community, particularly targeting outspoken women.”
At its benign end, it was a movement for stronger ethics in video game journalism. At its malignant end, it involved quite a lot of male gamers sending abuse and violent threats to female players and developers.
The PPSAI report is open for comment until July 7. It has so far attracted over 10,000 emails, most of them rustled up by registrar letter-writing campaigns here and here.

New gTLD sales miss ICANN estimates by a mile

New gTLD registration volumes failed to live up to ICANN’s expectations by a long, long way in its fiscal 2015.
When ICANN’s FY15 ended on Tuesday, new gTLDs had fewer than 6 million domains in their collective zone files.
That’s just 18% of ICANN’s original early 2014 estimate of 33 million domains and just 39% of its revised March 2015 estimate of 15 million names.
It’s going to be harder to compare future new gTLD performance to ICANN’s projections, as the program enters its second year of live activity.
The organization’s recently published draft fiscal 2016 budget does not have a “total registrations” number to compare to the 15/33 million projection in last year’s budget.
It does, however, predict 12.5 million billable registrar transactions in FY16, which began yesterday.
Billable registrar transactions include renewals and transfers, however, so ICANN is not saying that there will be 12.5 million extant new gTLD registrations this time next year.

You might be surprised how many new gTLDs have changed hands already

At least 86 new gTLD registry contracts have changed hands since the end of 2013, I have discovered.
ICANN calls the transfer of a Registry Agreement from one company to another an “assignment”. Global Domains Division staff said in Buenos Aires last week that it’s one of the more complex and time-consuming tasks they have to perform.
So I thought I’d do a count, and I discovered some interesting stuff.
Donuts/Rightside
The biggest beneficiary of incoming assignments so far is of course Rightside, aka United TLD Holdco, which has so far taken over 23 of the gTLDs applied for by Donuts.
The two companies have had an agreement since the start that allows Rightside to take on as many as 107 of Donuts’ original 307 applications.
Interestingly, Rightside sold .fan to AsiaMix Digital after Donuts had transferred the gTLD to it.
Amazon
We also discover that Amazon is repatriating its gTLD contracts en masse.
So far, 21 gTLDs applied for by Amazon EU Sarl — the Luxembourg-based company Amazon uses to dodge tax in other European countries — have been transferred to US-based Amazon Registry Services Inc.
Amazon EU has made money losing new gTLD auctions.
Given the company’s usual MO, I have to wonder whether Amazon Registry Services, under the US tax regime, plans to make any money at all from its new raft of gTLDs.
Subsidiary changes
Speaking of tax, four gTLDs associated with the Hong Kong-based Zodiac group of applicants have been transferred to new Cayman Islands companies with similar names.
A bunch of the other assignments appear to be registries shifting contracts between various subsidiaries.
IG Group, a large UK derivatives trader, has assigned seven gTLDs (such as .forex, .markets and .spreadbetting) to newly created UK subsidiaries, for example.
Also, Ireland-based Afilias transferred the .green RA to a new Irish subsidiary, while Germany-based .srl applicant mySRL has sent its contract to a Florida-based sister company from the InternetX stable.
There are several other example of this kind of activity.
Actual acquisitions
As best as I can tell, there have been only eight actual post-contracting acquisitions so far: .trust, .fan, .meet, .reise, .xn--ses554g, .rent, .theatre, and .protection.
The only one of those I didn’t know about — and haven’t seen reported anywhere — was .meet, which Afilias seems to have sold to Google back in February.
It should be noted that while I’ve counted 86 assignments, I may have missed some. At least one — XYZ.com’s acquisition of .security from Symantec, does not appear have been completed yet, judging by ICANN’s web site.