Minds + Machines to raise $4.7m for new TLDs

Top Level Domain Holdings plans to raise £3 million ($4.7 million) in a stock sale to help finance the TLD aspirations of its main business, Minds + Machines.
The funds would almost double the cash reserves TLDH has on tap, which currently amount to $5.5 million, according to StockMarketWire.com.
Recently appointed CEO Antony Van Couvering said in a statement that ICANN’s recent decision to allow registries and registrars to vertically integrate had a bearing on the decision to raise funds:

Having reviewed ICANN’s Final Proposed Applicant Guidebook, and in view of the ICANN Board’s historic decision to do away with cross-ownership restrictions between registries and registrars, we believe that the timing is right for additional investment by TLDH. ICANN’s registry-registrar decision means that additional gTLD business models are now viable, and we have already seen a marked increase in interest from prospective new clients. We intend to make sure we have the resources to take advantage of this opportunity.

M+M is already associated with new TLD applications including .gay and .eco, both of which are expected to be contested by other applicants.
TLDH is listed on London’s small-cap Alternative Investment Market. The announcement of the placement can be found here.

Three registrars face the ICANN chop

ICANN has told three registrars they are in breach of their registrar contracts and will lose their accreditation next month unless they rectify the problems.
These registrars, all of which appear to have negligible numbers of gTLD domains under management, are affected:
Mister Name will be shut down if it does not pay its ICANN fees and escrow its Whois data.
Open System Ltd is accused of not having a functioning Whois service.
Best Bulk Domains Inc also doesn’t have a functioning Whois, ICANN said. It also has not been paying its dues and hasn’t maintained accurate contact information for itself.
All three have dates in mid-December to clean up their acts or lose their right to sell gTLD domains.
You can find ICANN’s compliance letters here.

Governments still want new TLD morality veto

ICANN’s Governmental Advisory Committee still wants to block “controversial” new top-level domains on morality grounds.
In a letter to ICANN chairman Peter Dengate Thrush, a copy of which I have obtained, the GAC makes it clearer than ever that it wants national laws to play a part in approving new TLDs.
It also suggests that national governments should be able to pre-screen strings before applications are filed, to give applicants “early warning” that they are stepping into controversial waters.
The letter draws the battle lines for what could be some heated debate at ICANN’s meeting in Cartagena next month.
Given that the letter does not appear to have been published by ICANN yet, I will quote liberally.
Under the heading “Universal Resolvability of the DNS”, GAC interim chair Heather Dryden, the Canadian representative on the committee, wrote:

Due to uncertainties regarding the effectiveness of ICANN’s review and objections procedures, a country may feel compelled to block a new gTLD at the national level that it considers either objectionable or that raises national sensitivities.
To date, there do not appear to be controversial top level domains that have resulted in significant or sustained blocking by countries.
The GAC believes it is imperative that the impact on the continued security, stability and universal resolvability of the domain name systems of the potential blocking at the national level of the new gTLD strings that are considered to be objectionable or that raise national sensitivities be assessed prior to introducing new gTLDs.

The letter carries on to say that the GAC will “seek advice from the technical community” on the issue.
Dryden wrote that there should be a “prior review” process that would be able to identify strings that are “contrary to national law, policy or regulation” or “refer to religions, ethnicity, languages or other cultural identifiers that might raise national sensitivities”.
It sounds like the GAC envisions a pre-screening process, before new TLD applications are officially filed, similar to the “expressions of interest” concept that ICANN abandoned in March.
What TLDs this process would capture is unclear. The GAC letter notes by way of example that “several governments restrict the registration of certain terms in their ccTLDs”.
In practical terms, this would raise question marks over TLDs such as “.gay”, which would quite clearly run contrary to the policies of many national governments.
(As I reported earlier this month, the recently relaunched .so registry currently bans “gay”, “lesbian” and related terms at the second level.)
There’s more to be reported on the the implications of this letter, particularly with regards the work of ICANN’s “morality and public order” policy working group and the GAC’s relationship with ICANN in general.
Watch this space.

Afilias to raise .info prices

Afilias has notified ICANN that it plans to raise the maximum annual registration fee for a .info domain next year.
The new price, which will come into effect July 1, 2011, will be $7.42. It’s been $6.75 since November 2008, although the registry often offers deep discounts on new registrations.
Afilias’ contract with ICANN allows it to raise prices by up to 10%, which it appears to be doing in this case.
At least two other other gTLDs have already said they plan to up their maximum prices next year.
NeuStar’s .biz fee will rise by $0.45 to $7.30 in April. PIR’s .org will start costing registrars a maximum of $7.21 at the same time.

ICANN told to ban .bank or get sued

A major financial services lobby group has threatened to sue ICANN unless it puts strict limitations on “.bank” top-level domains.
BITS, the technology policy arm of the Financial Services Roundtable, said financial domains should be banned from the first round of new TLDs, until rules governing security are developed.
In a November 4 letter to ICANN chief executive Rod Beckstrom, BITS said:

If these critical issues are not fully resolved and ICANN chooses not to defer financial TLD delegation, BITS, its members and its partners are prepared to employ all available legislative, regulatory, administrative and judicial mechanisms.

BITS counts all the major US banks among its membership, as well as many large insurance companies and share-trading services.
The organization is concerned that TLDs such as .bank could lead to consumer confusion and an increase in fraud online if delegated into the wrong hands.
While BITS said that it “prefer[s] a prudent solution”, it has threatened to file “legal complaints in one or more jurisdictions” and to lobby the US Congress for legislation.
It noted that ICANN’s IANA contract, which gives it the power to create new TLDs, expires next August, and said that it may lobby Congress for legislation mandating better security as a condition of the renewal.
BITS and other financial groups have already written to members of Congress, in September, expressing disappointment with the absence of a high-security TLD policy from ICANN and adding:

In recognition of the need for higher levels of security and stability in financial services gTLDs than in gTLDs generally, we urge you to support inclusion of language in cyber security legislation language that prevents ICANN from adding financial services gTLDs to the root zone unless the IANA contract specifies higher levels of security for such gTLDs.

The Federal Deposit Insurance Corporation, the US government body responsible for insuring banks, has also written to the Department of Commerce, expressing its concerns about the possible introduction of a .bank TLD.
Currently, I’m not aware of any public initiative to apply for .bank, but it’s possible that restrictions on financial services TLDs could capture the recently launched German “.insurance” project.
The BITS correspondence was published (pdf) as an attachment to an ongoing Reconsideration Request lodged by Michael Palage, chair of the High Security Top Level Domain Verification Program Advisory Group.
The HSTLD group has been working on a set of technological policy specifications for registries managing high-security TLDs.
Palage is annoyed that ICANN’s board seems to have distanced itself from the HSTLD concept before the group has even finished its work, by resolving in September that:

ICANN will not endorse or govern the program, and does not wish to be liable for issues arising from the use or non-use of the standard.

The HSTLD group, by contrast, has a “clear majority in support of ICANN retaining a continued oversight role”, according to Palage. He wrote:

The ICANN Board’s unilateral actions also have a chilling effect on future bottom up consensus efforts because participants have no basis to know when the ICANN Board will take such unilateral actions in the future.

He’s not alone in worrying about recent top-level ICANN decisions that appear to put corporate legal liability ahead of the wishes of the community. I reported on the issue last week.

Go Daddy objects to numeric .tel domains

Go Daddy has objected to Telnic’s plan to start selling numeric .tel domain names, saying that it, among other things, “smells a lot like gaming”.
Telnic applied to ICANN last month to revise its registry contract to enable it to start selling domains containing numbers and hyphens.
I speculated a month ago that the International Telecommunications Union might object to the proposal, for reasons I explained in some depth.
(Briefly, Telnic won the .tel sponsored TLD partly because it promised for years not to enable domains that could look like phone numbers.)
But the ITU had nothing to say, at least in terms of the ICANN public comment period.
Go Daddy’s Tim Ruiz did object last Saturday on related grounds, telling ICANN:

We believe that this request cannot be granted without requiring the rebidding of the .tel sTLD itself. It is unfair to other applicants and potential applicants to allow an sTLD to change its purpose after the fact.
…
Since community, purpose, and use were such important aspects of the sTLD allocation decisions it seems inappropriate, fundamentally unfair, and even smells a lot like gaming, to allow an sTLD to change those aspects without an opportunity for others to bid competitively.

In response to Ruiz’s letter, Telnic chief executive Khashayar Mahdavi wrote to ICANN:

The restriction on all-numeric strings has nothing to do with the nature of .tel and was instead a measure put in place to address initial concerns about potential conflicts with ENUM… We believe time and the growing understanding of the .tel technology have proven such a conflict does not exist.

ENUM is a protocol for addressing voice services using the DNS. It uses dots between each individual digit of a phone number, which would be specifically disallowed under Telnic’s plans.
Mahdavi also expressed confusion as to why Go Daddy bothered to object – it is not currently a registry, it does not carry .tel domains and it will presumably not be affected by the relaxation of the .tel rules.
Is it possible the registrar is taking a principled stance?
Ruiz also noted:

We believe that certain other recent requests under the guise of the RSEP [Registry Services Evaluation Process] by sTLDs were also likely inappropriate for similar reasons

He didn’t specify which sTLDs he was talking about. Without wishing to put words into his mouth, I can think of at least one that fits the description.
The Telnic proposal has already passed ICANN’s staff evaluation. I expect it could come before the board next month at its Cartagena meeting.
In separate news, Telnic’s less-controversial proposal to start selling one and two-character .tel domains has now passed its ICANN evaluation (pdf).

How “final” is the new TLD guidebook?

Many would-be new top-level domain registries were pleasantly surprised a week ago when ICANN published the latest Applicant Guidebook and referred to it as the “proposed final” version.
But it was pretty clear, even on a cursory reading, that the AGB is far from complete; in some cases, text is explicitly referred to as being subject to further revision.
There’s also a public comment period ongoing, providing feedback some of which will presumably be taken on board by ICANN at its Cartagena meeting next month.
But ICANN has now provided a little bit more clarity on how “final” the “proposed final” AGB really is.
Senior veep Kurt Pritz, ICANN’s point man on the new TLD program, had this to say on Thursday’s teleconference of the GNSO Council:

There are always going to be changes to the guidebook. And so, even though this is the proposed final guidebook, we’re doing some final work on trying to find areas of accommodation with the Recommendation 6 working group and making some changes there, and working through perhaps a registry code of conduct; there are perhaps some issues with data protection there.
If folks want to consider this as final it will have to be with the understanding that the guidebook will always be changing, but having an understanding that those changes really don’t materially change the positions of applicants or the decisions of whether or not to go ahead and apply or the resources necessary to apply or sustain registry operations.

I reported on some of the issues with the Rec 6 working group, which is dealing with the “morality an public order objections” process, earlier this week.
The registry code of conduct, which sets limits on what data can be shared in co-owned registries/registrars, was new in the latest AGB draft. It looks to me like the kind of thing you’d normally expect to be debated for many months before being accepted.
But apparently future changes to these parts of the guidebook will not be substantive enough to change potential applicants’ plans.
Pritz said on the GNSO call that the current public comment period, which ends on the day of the Cartagena board meeting, could be thought of as similar to the comment periods that precede votes on ICANN’s budget.
In those cases, the board votes to approve the budget subject to changes based on public comments in advance of those changes being made.
It seems to me that the board’s options in Cartagena are to a) approve the AGB, b) approve it subject to directed changes (the “budget” scenario), or c) delay approval pending further community work.
I’m guessing option b) is the preferred outcome, but there’s no predicting what surprises could emerge over the next few weeks.

Sponsor stonewalls .jobs critics

The sponsor of the .jobs top-level domain appears to be giving opponents including Monster.com a hard time as they continue to challenge the liberalization of the domain.
In its most recent ICANN filing (pdf), the Society for Human Resource Management said it does not want to meet with the .JOBS Charter Compliance Coalition and ICANN to help resolve their differences.
Last week, SHRM declined to given ICANN a straight answer when it asked whether jobs sites like Monster.com will be able to register domains under the new .jobs rules.
The Coalition of jobs sites was assembled to oppose the “Phased Allocation Program”, which allows .jobs registry Employ Media to allocate thousands of premium geographic and vocational domains to its partners.
While the program has already been approved by ICANN’s board, the Coalition has filed a Reconsideration Request appeal in an attempt to get the ruling overturned.
This week, Coalition lawyer Becky Burr sent a letter (pdf) to ICANN asking for a face-to-face meeting with representatives of ICANN, the Coalition, Employ Media and SHRM.
In response, SHRM general counsel Henry Hart said the organization “does not believe that it should participate in such a meeting.”
Last week, SHRM threw its full support behind Employ Media, tersely responding (pdf) to a list of ICANN’s questions relating to the registry’s plans for the domain.
ICANN’s reconsideration committee wanted to know whether the allocation program violated the .jobs charter by allowing registrants from outside the human resources community.
SHRM said it did not, but it did confirm that it does expect .jobs – which has so far been reserved for companies to list their own job vacancies – to be used in future for aggregated jobs sites operated by Employ Media.

Did the SHRM PD Council intend to enable the Registry (Employ Media) to register domain names in the .JOBS sTLD for the purpose of allowing third-party job postings on those sites? If so, please explain how this consistent with the .JOBS Charter.
Yes. The PD Council concluded, based on input from the Community, that this would serve the needs of the international human resource management community.

But when ICANN asked whether this means Monster.com, for example, would qualify, SHRM response was more vague.

Are independent job site operators (such as Monster.com) engaged in “human resources management” for the purpose of the definition set forth in the .JOBS Charter if the job site operator is advertising for jobs outside its own organization?
Independent job site operators provide a highly valued service to the international human resource management community.

The Coalition, in Burr’s letter, said the answers “simply ignore the responses sought by the direct questions of the [Board Governance Committee”.
Hart disputed this characterization of the answers.
Employ Media plans to allocate premium domains at first via an RFP process. It’s believed that the DirectEmployers Association is set to receive the lion’s share of the good domains for its universe.jobs plan.

Some new TLDs will have traffic from day one

Some non-existent top-level domains already receive so much traffic that they would risk being overwhelmed if delegated under ICANN’s new TLD program.
That’s one of the takeaways from a new report from ICANN’s Security and Stability Advisory Committee, published this week (pdf).
Amazingly, the SSAC found that the top 10 non-existent TLDs already account for a whopping 10% of traffic at the DNS root servers, with some strings receiving many millions of lookups every day.
Over a quarter of the TLD resolutions handled by the roots result in errors, it found.
Most of these invalid lookups are the result of configuration errors on networking gear.
The word “local” is responsible for about 5% of all TLD lookups, the report says. The terms “corp”, “lan”, “home” and “belkin” also account for big slices of traffic.
This presents potentially serious security problems, as you might imagine.
Imagine that “.lan” is approved as a TLD. Previously unresolveable domains would start working, and badly configured gear could start sending private LAN data out into the cloud.
It would also put an big load on the .lan TLD operator from day one.
The SSAC said:

The .lan TLD registry operator – and generally, any TLD registry operator that chooses a string that has been queried with meaningful frequency at the root – potentially inherits millions of queries per day. These queries represent data that can be mined or utilized by the registry operator.

The report recommends that ICANN add certain highly trafficked strings from to its list of prohibited TLDs, and also that it warns applicants for TLDs that already have traffic.

We recommend that ICANN inform new TLD applicants of the problems that can arise when a previously seen string is added to the root zone as a TLD label and that ICANN should coordinate with the community to identify principles that can serve as the basis for prohibiting the delegation of strings that may introduce security or stability problems at the root level of the DNS.

If endorsed by ICANN, the recommendation could make TLDs such as .home, .corp and .local verboten. It could also present Belkin with a problem if it planned to apply for a “.brand”.
(UPDATE: .local is actually already on the reserved list)

Vertical integration was not a slam dunk

Two members of ICANN’s board voted against the decision to allow registrars and registries to own each other, according to a preliminary report from its November 5 meeting.
The decision was a surprise when it was announced last week, as it was diametrically opposed to the board’s previous stance essentially opposing vertical integration.
The new position, already incorporated in the Applicant Guidebook, allows registrars to apply to run new top-level domains, subject to a code of conduct.
From the board of directors’ meeting report:

Eleven Board members voted in favor of the Resolution. Two Board members were opposed to the Resolution. Two Board members did not participate in the discussion or the vote on the Resolution due to conflicts of interest. The Resolution carried.

I believe Bruce Tonkin was one of the people who recused themselves from the vote. I’m not certain who the other was.
We won’t discover who the dissenting opinions belonged to, or what they were, until the minutes are published, probably not long after the Cartagena meeting next month.