Unrest remains despite new new gTLD contract

ICANN has proposed big changes to how it will handle premium domain names, dot-brands, mergers and acquisitions and mandatory fees in new gTLDs.
It published a new version of the proposed Registry Agreement for new gTLD operators this morning, saying that it is the product of months of “negotiations” with applicants and registries.
But some applicants and back-end providers disagree with this characterization, saying that while some registries helped ICANN with the text they have no authority to speak for all applicants.
The agreement was posted for 42 days of public comment this morning. Before it is approved by the ICANN board of directors, no new gTLD applicants will be able to sign contracts and begin to go live.
There are several major changes compared to the version in the Applicant Guidebook.
Premium domains not dead after all
In what could prove to be the most significant and controversial changes, ICANN has given registries the ability to run Founders Programs and premium name schemes without interference from trademark owners.
New text in the contract will let them self-register up to 100 names “necessary for the operation or the promotion of the TLD” and release those names to third parties if they want.
This appears to be a way around the fear that mandatory Sunrise periods could thwart registries’ plans to sign up anchor tenants to the gTLDs, a crucial launch marketing tactic for many.
The new RA also appears to give broad powers to the registry to allocate premium domain names at will.

Registry Operator may withhold from registration or allocate to Registry Operator names (including their IDN variants, where applicable) at All Levels in accordance with Section 2.6 of the Agreement. Such names may not be activated in the DNS, but may be released for registration to another person or entity at Registry Operator’s discretion.

There does not appear to be a numerical limit on how many domains can be reserved in this way.
Hypothetically, this might allow a registry to reserve the entire dictionary (or dictionaries) at launch, preventing holders of trademarks on generic terms grabbing the matching names during Sunrise.
The still-draft Trademark Clearinghouse rules will also play a part here, but from the RA it looks like registries have just been handed a massively flexible reservation tool.
If my initial interpretation is correct, I expect the trademark lobby will have strong view here.
Concessions for dot-brands
New text in the agreement makes it clearer that ICANN has no plans to redelegate dot-brand gTLDs to third parties after the Registry Agreement expires or is terminated.
This means, for example, that if L’Oreal decides to stop using .loreal at some point in future, ICANN very probably won’t give .loreal to a competitor. The new text is:

(i) ICANN will take into consideration any intellectual property rights of Registry Operator (as communicated to ICANN by Registry Operator) in determining whether to transition operation of the TLD to a successor registry operator

It’s probably not rigid enough language to satisfy some lawyers’ wishes, but I think it does enough to convey the spirit of ICANN’s intentions.
ICANN is of course mainly concerned that dead gTLDs don’t leave registrants with dead domain names, but if there are no registrants I can’t imagine why it would want to redelegate.
Lower fees for registries
Newly added text in the RA specifies that registries must pay ICANN a $5,000 one-off fee (per TLD) to use the new Trademark Clearinghouse, plus with $0.25 per domain that uses its services.
Domains registered under Sunrise periods or which trigger Trademark Claims alerts would incur this one-time fee, which appears to have been reduced from the $0.30 previously discussed.
These fees will actually be passed on to the Trademark Clearinghouse operators (Deloitte and IBM), for which ICANN has agreed to manage billing in order to keep costs down.
In addition, the RA now clarifies that the registry operator’s regular fixed fees to ICANN of $6,250 a quarter only kick in from the date that the gTLD hits the DNS root, not the date of contract signing. That could save registries up to a year’s worth of fees, if they’re late to delegation.
M&A approvals
There are also changes to the way ICANN plans to approve of mergers and acquisitions among registries.
First, it will be much easier for the contract to be passed around within a corporate holding group. The RA now states:

Registry Operator may assign this Agreement without the consent of ICANN directly to a wholly-owned subsidiary of Registry Operator, or, if Registry Operator is a wholly-owned subsidiary, to its direct parent or to another wholly-owned subsidiary of its direct parent, upon such subsidiary’s or parent’s, as applicable, express assumption of the terms and conditions of this Agreement

This change would seem to enable portfolio applicants that have applied for many gTLDs each under separate shell company names (Donuts, for example) to consolidate their contracts under a single parent.
What I don’t think it does is allow for contention set resolution based on joint ventures (which are obviously not “wholly owned”), such as what Uniregistry and Top Level Domain Holdings announced they had agreed to yesterday.
The new RA also states that ICANN must approve subcontracting deals the registry inks for any of the five “critical functions” (EPP, DNS, DNSSEC, Whois and escrow).
Unilateral amendments are gone
The controversial “unilateral right to amend” that ICANN wanted to grant itself — essentially an emergency power to change the contract almost at whim and over the objections of registries — is gone.
It’s been replaced with a convoluted series of procures almost identical to those found in the proposed final version of the 2013 Registrar Accreditation Agreement currently open for comment.
Registries would get the ability to punt the changes to a GNSO Policy Development Process, submit alternative amendments, take ICANN to arbitration or request exemptions, under the new rules.
While the new provisions still give ICANN the ability to force through unpopular changes under certain circumstances, a lot more engagement by registries is envisaged so “unilateral” is probably not a good word to use any more.
So is the deal final or not?
ICANN said in a blog post: “The proposed agreement is the result of several months of negotiations, formal community feedback, and meetings with various stakeholders and communities.”
It added:

We have come a long way since February 2013 when we posted a proposed Revised New gTLD Registry Agreement for public comment. A new and highly spirited sense of mutual trust has catapulted us into a fresh atmosphere of collaboration, which in turn has led to a consistently more productive environment. The spirit of teamwork, productive dialogue and partnership that has underpinned this negotiation process is tremendously heartwarming, as it has allowed us to bring to fruition a robust contractual framework for the New gTLD Program.

But some are worried that ICANN seems to be portraying the RA as equivalent to the Registrar Accreditation Agreement, which was subject to 18 months of talks with a negotiating team representing registrars.
The registries’ Registry Agreement Negotiating Team (RA-NT), on the other hand, was formed less than three weeks ago during ICANN’s meeting in Beijing, and did not have the authority to speak for all applicants.
The RA-NT said in a statement published by ICANN:

The RA-NT agreed to review the new gTLD Registry Agreement with ICANN staff in an effort to minimize some of the more controversial aspects of the Agreement for applicants as a whole. While participants reflected a variety of perspectives, the team did not “represent” or have any authority to “speak for” new gTLD applicants generally, or any group of applicants.

ARI Registry Services CEO Adrian Kinderis told DI:

My fears (and frustrations) come from the fact that ICANN staff have made it sound like they have reached the same point in the process. “It is done”. It most certainly isn’t “done”. They need to understand that the negotiation is actually still very much active and all of the community should feel like their opinions and feedback will be considered in the development of the “final draft”.

The draft RA is now open for public comment until June 11.
That would give ICANN about a month to synthesize all the comments, make any changes, and put the deal to its board of directors for approval during the meeting in Durban, South Africa, this July.

First new gTLD contention set settled as Uniregistry and TLDH sign deal

Top Level Domain Holdings and Uniregistry have inked a deal to go splits on the proposed .country registry, the first publicly announced settlement of a new gTLD contention set.
The two companies are the only applicants for .country, so assuming one or both applications are approved by ICANN no auction will be required to decide who gets to run it.
It’s not yet clear which applicant will drop out of the race; it appears that TLDH and Uniregistry are waiting for their Initial Evaluation results to come out before making that call.
A new 50:50 joint venture will be formed to take over the contract. The companies said in a press release:

Under the conditional heads of terms for the proposed joint venture, either Uniregistry or TLDH will withdraw its application and, once the surviving applications is approved by ICANN, the authority to operate .country will be transferred to the new joint venture. The transfer will require ICANN approval, which the directors of the Company fully expect to be forthcoming.

Uniregistry’s prioritization number is 1232 and TLDH’s is 664. If TLDH passes Initial Evaluation, it would make sense for Uniregistry to pull out at that time to speed up the time to delegation.
TLDH CEO Antony Van Couvering said the deal is “pro-competitive and will result in lower prices for consumers”.
Uniregistry and TLDH are competing on another 20 gTLD strings, but .country is the only two-horse race they’re involved in.

Another 44 new gTLDs pass Initial Evaluation

ICANN has posted its latest weekly batch of Initial Evaluation results for new gTLD applications, with 44 new passes and no failures.
The publication brings the grand total of passing applications to 213, with only one failure to date and 51 withdrawals.
Today’s passing strings are:

.微博 (Wei-bo), .慈善 (charity), .微博 (microblogging), .cimb, .wme ,broadway, .astrium, .associates, .coach, .aaa, .chase, .app, .trading, .nra, .vip, .engineer, .voyage, .yachts, .live, .cpa, .swiss, .auction, .emerck, .site, .godaddy, .epson, .pictures, .schaeffler, .omega, .dental, .hermes, .xin, .flowers, .qvc, .bofa, .email, .hotel, .scb, .cymru, .bridgestone, .dot, .talk, .cab, .guru.

Some notable things that immediately jump out at me:

• Go Daddy’s application for the .godaddy dot-brand has passed.
• The first application for .app — one of the most heavily contested strings — has passed.
• So far none of the five Top Level Domain Holdings applications with Minds + Machines back-ends and priority numbers under 250 have passed.
• Of the four Famous Four Media bids under 250, only one has passed.
• Donuts is up to 29 passes, almost 10% of its total applications.
• Amazon and Google have clean sheets so far.

ICANN is now at priority number 250 in its IE publication running order, which means 36 applications that could have passed already haven’t.
ICANN has previously stated that these delays are mostly due to processing responses to clarifying questions and change requests.

Looking for a better new gTLD search engine?

I’ve heard a few people complain this week about ICANN’s revamped new gTLD application page, so I thought it would be an ideal time to shamelessly plug DI’s New gTLD Application Tracker.
The Application Tracker has been significantly improved since it was first released last year, and now supports no less than 19 advanced search criteria, enabling users to construct extremely granular searches.

Want to search for only geographical, community or IDN gTLDs, or vice versa? You can do that.
Want to search for only gTLDs with GAC Advice or GAC Early Warnings? You can do that.
Want to see all the bids that failed Initial Evaluation? You can do that.
Want to search for all the contention sets where Uniregistry is competing with Amazon? You can do that.
Want to search for all the applications in contention sets with Google that have been withdrawn? You can do that.
Want to search for all the non-IDN bids filed by TLDH that have passed IE but are in contention and have GAC Advice but didn’t get an Early Warning? You can do that.
Want to search for “closed generic” strings containing the letter C applied for by Google that have GAC Advice and Objections and are in contention with Donuts? You can do that too.

Each application also has its own page containing key portions of the application as well as listing public comments, competing bids, objections, GAC Advice and Early Warnings in a simple one-page view.
In short, the Application Tracker is an extremely flexible research tool for people closely following the new gTLD program.
We’re always receptive to additional feature suggestions.
The Application Tracker is currently available as one of the services provided to annual or monthly DI PRO subscribers.

Photos: ICANN shares new gTLD timeline at private New York meeting

ICANN has a new version of its constantly evolving new gTLD program timetable that accounts for Governmental Advisory Committee advice and other recent developments.
Staff talked through the timeline with participants at an invitation-only industry meeting in New York on Tuesday, but we have a couple photos to share more widely, provided by an attendee who declined attribution.
This first one will be familiar to new gTLD applicants who regularly attend ICANN’s update webinars, but there are a few differences compared to the version seen in Beijing (pdf), which address new roadblocks.

First, you’ll notice that there’s a new line for GAC advice, following the release of the GAC’s Beijing communique.
The slide seems to suggest that ICANN expects to have dealt with the advice before June. On the face of it, and without the full context of the staff presentation, this seems optimistic.
Second, the controversial Registry Agreement is addressed on the slide. ICANN seems to see the RA being published for public comment very soon, and finalized by the end of June.
All the new gTLD applicants and existing registry operators I’ve talked to this week seem to think this is more or less doable. Registries have much more incentive for speedy resolution than registrars did.
Third, due to the RA delay, ICANN won’t start contracting with new gTLD applicants until the end of June or beginning of July, according to the slide.
Operational dates for the Trademark Clearinghouse, Emergency Back-End Registry Operator and Uniform Rapid Suspension service all appear to be unchanged.
In this second slide, not used in Beijing, we see a visual representation of ICANN’s Initial Evaluation results posting schedule.

ICANN is currently posting about 50 results every Friday, having started off at 30 a week, but the slide shows ICANN expects to ramp up to 100 per week on May 24.
The New York meeting, one of ICANN CEO Fadi Chehade’s ongoing series of management roundtables, was attended by senior-level executives from many of the largest industry players.
As well as the new gTLD timetable, topics including the Domain Name Association, conferences and media awareness were discussed.
It was originally going to be followed by a splashy media event to officially launch the first new gTLDs, but that was delayed, due to the lack of any contracts to sign.

GAC claims its first new gTLD scalps

Two new gTLD portfolio applicants have withdrawn a total of nine applications following advice from ICANN’s Governmental Advisory Committee.
Top Level Domain Holdings, owner of Minds + Machines, said it has binned its bids for .free, .sale, .spa and .zulu “as a consequence of these warnings, and after discussion with relevant governments”.
.spa and .zulu are both on the GAC’s shortlist for further consideration on geographical/cultural grounds (Spa is also a town in Belgium) and were due to be discussed at the ICANN meeting in Durban this July.
It’s less clear why TLDH has chosen to scrap .free and .sale, however.
Both were among over 300 bids to receive GAC advice on “consumer protection” grounds, but they were by no means the only TLDH applications to get hit with the same stick.
The company has 21 applications with “consumer protection” advice.
Its bids for .book and .cloud, for example, are listed in exactly the same place in the GAC’s Beijing communique as .free and .sale, and have similar contention profiles, but have not been withdrawn.
TLDH said in a press release that it expects to get a $520,000 from ICANN for withdrawing the bids and another $144,000 from the release of its Continued Operations Instrument risk fund.
Meanwhile, entrepreneur Bekim Veseli has yanked the remaining five of his original seven gTLD bids, all of which had been hit by advice on the basis that they’re “corporate identifiers” such as .inc and .corp.
I understand this withdrawals may not have related directly to the GAC advice, however, and may be also due to the fact that they’re all highly contested strings.

New Domain Name Association names interim board

The formative Domain Name Association has started calling itself the Domain Name Association and is moving closer to a proper launch under the guidance of an interim board of directors.
This is the trade group that started getting together in January, kick-started by Google, and launched a one-page web site at WhatDomain.org in March.
Right now, ARI Registry Services CEO Adrian Kinderis is acting as chair of the interim board.
The rest of the board comprises: Jon Nevett (Donuts), Elizabeth Sweezey (FairWinds), Rob Hall (Momentous), Jeff Eckhaus (Demand Media), Statton Hammock (Demand Media), and Job Lawrence (Google).
According to a presentation Kinderis gave at a meeting of ICANN execs and industry leaders in New York yesterday, the DNA will be a non-profit, independent organization funded by membership fees.
Membership will be open to registries, registrars, resellers, back-end providers and individual consultants.
The mission is to: “Promote the interests of its members by advocating the use, adoption, and expansion of domain names as the primary tool for users to navigate the Internet.”
The finer details of scope, marketing, governance and funding are still being worked out, but if you’re in the industry you can probably expect an invitation to join before too long.
It’s actually not the only industry trade group forming at the moment.
Judging by presentations given in Beijing two weeks ago, the Brand Registry Group is thinking about coming together as a trade association as well as a constituency within ICANN’s policy-making structure.

Deadbeat registrar is also a massive new gTLD applicant

One of the latest three registrars to receive ICANN contract breach notices is also a new gTLD applicant involved in four applications, a helpful reader has pointed out.
A. Telecom S.A., which owes ICANN $10,863.67 in unpaid accreditation fees and is facing a May 14 de-accreditation if it doesn’t pay up, doesn’t have any gTLD domains under management.
It is, however, part of the Brazilian wing of Telefonica, the Spanish telecommunications giant.
Telefonica Brasil SA has applied for .vivo while the corporate parent Telefonica SA is behind applications for .movistar, .telefonica and .terra. They’re all single-registrant dot-brand applications.
Telefonica had revenue of about $80 billion last year, and employs over 280,000 people, so I doubt a measly $10,000 would even cover its daily toilet paper bill.
I can only assume that its ICANN breach notice is a result of a paperwork problem.

Could this be ICANN’s most important public comment period ever?

How much power should governments have over the domain name industry? Should the industry be held responsible for the actions of its customers? Are domain names the way to stop crime?
These are some of the questions likely to be addressed during ICANN’s latest public comment period, which could prove to be one of the most important consultations it’s ever launched.
ICANN wants comments on governmental advice issued during the Beijing meeting two weeks ago, which sought to impose a broad regulatory environment on new gTLD registries.
According to this morning’s announcement:

[ICANN’s Board New gTLD Committee] has directed staff to solicit comment on how it should address one element of the advice: safeguards applicable to broad categories of New gTLD strings. Accordingly, ICANN seeks public input on how the Board New gTLD Committee should address section IV.1.b and Annex I of the GAC Beijing Communiqué.

Annex 1 of the Beijing communique is the bit in which the GAC told ICANN to impose sweeping new rules on new gTLD registries. It’s only a few pages long, but that’s because it contains a shocking lack of detail.
For all new gTLDs, the GAC wants ICANN to:

• Apply a set of abuse “safeguards” to all new gTLDs, including mandatory annual Whois accuracy audits. Domain names found to use false Whois would be suspended by the registry.
• Force all registrants in new gTLDs to provide an abuse point of contact to the registry.
• Make registries responsible for adjudicating complaints about copyright infringement and counterfeiting, suspending domains if they decide (how, it’s not clear) that laws are being broken.

For the 385 gTLD applications deemed to represent “regulated or professional sectors”, the GAC wants ICANN to:

• Reject the application unless the applicant partners with an appropriate industry trade association. New gTLDs such as .game, .broadway and .town could only be approved if they had backing from “relevant regulatory, or industry self-­regulatory, bodies” for gaming, theater and towns, for example.
• Make the registries responsible for policing registrants’ compliance with financial and healthcare data security laws.
• Force registries to include references to organic farming legislation in their terms of service.

For gTLD strings related to “financial, gambling, professional services, environmental, health and fitness, corporate identifiers, and charity” the GAC wants even more restrictions.
Essentially, it’s told ICANN that a subset of the strings in those categories (it didn’t say which ones) should only be operated as restricted gTLDs, a little like .museum or .post are today.
It probably wouldn’t be possible for a poker hobbyist to register a .poker domain in order to blog about his victories and defeats, for example, unless they had a license from an appropriate gambling regulator.
Attempting to impose last-minute rules on applicants appears to reverse one of the GAC’s longstanding GAC Principles Regarding New gTLDs, dating back to 2007, which states:

All applicants for a new gTLD registry should therefore be evaluated against transparent and predictable criteria, fully available to the applicants prior to the initiation of the process. Normally, therefore, no subsequent addition selection criteria should be used in the selection process.

The Beijing communique also asks ICANN to reconsider allowing singular and plural versions of the same string to coexist, and says “closed generic” or “exclusive access” single-registrant gTLDs must serve a public interest purpose or be rejected.
There’s a lot of stuff to think about in the communique.
But ICANN’s post-Beijing problem isn’t whether it should accept the GAC’s advice, it’s to first figure out what the hell the GAC is actually asking for.
Take this bit, for example:

Registry operators will require that registrants who collect and maintain sensitive health and financial data implement reasonable and appropriate security measures commensurate with the offering of those services, as defined by applicable law and recognized industry standards.

This one paragraph alone raises a whole bunch of extremely difficult questions.
How would registry operators identify which registrants are handling sensitive data? If .book has a million domains, how would the registry know which are used to sell books and which are just reviewing them?
How would the registries “require” adherence to data security laws? Is it just a case of paying lip service in the terms of service, or do they have to be more proactive?
What’s a “reasonable and appropriate security measure”? Should a .doctor site that provides access to healthcare information have the same security as one that merely allows appointments to be booked? What about a .diet site that knows how fat all of its users are? How would a registry differentiate between these use cases?
Which industry standards are applicable here? Which data security laws? From which country? What happens if the laws of different nations conflict with each other?
If a registry receives a complaint about non-compliance, how on earth does the registry figure out if the complaint is valid? Do they have to audit the registrant’s security practices?
What should happen if a registrant does not comply with these laws or industry standards? Does its domain get taken away? One would assume so, but the GAC, for some reason, doesn’t say.
The ICANN community could spend five years discussing these questions, trying to build a framework for registries to police security compliance, and not come to any consensus.
The easier answer is of course: it’s none of ICANN’s business.
Is it ICANN’s job to govern how web sites securely store and transmit healthcare data? I sure hope not.
And those are just the questions raised by one paragraph.
The Beijing communique as a whole is a perplexing, frustrating mess of ideas that seems to have been hastily cobbled together from a governmental wish-list of fixes for perceived problems with the internet.
It lacks detail, which suggests it lacks thought, and it’s going to take a long time for the community to discuss, even as many affected new gTLD applicants thought they were entering the home stretch.
Underlying everything, however, is the question of how much weight the GAC’s advice — which is almost always less informed than advice from any other stakeholder group — should carry.
ICANN CEO Fadi Chehade and chair Steve Crocker have made many references recently to the “multi-stakeholder model” actually being the “multi-equal-stakeholder model”.
This new comment period is the first opportunity the other stakeholders get to put this to the test.

Three registrars rapped for not paying ICANN fees

ICANN has sent compliance notices to three registrars for allegedly not paying their dues.
Dotted Ventures, Basic Fusion and A. Telecom S.A owe a total of roughly $25,000 in unpaid ICANN fees, according to the notices.
Basic Fusion and A Telecom also didn’t notify ICANN about changes of address, according to the notices.
All three have until May 14 to pay up or risk losing their registrar accreditation.
None of them are of notable size in the gTLD space, with fewer than 1,000 domains under management between them.