ICANN finished year $24 million ahead but loses $29 million on the markets

ICANN came out of fiscal 2022 $24 million ahead of its budget due to lower travel expenses and greater domain sales than expected, but blew $29 million on poor investments, according to financial results published today.

The Org ended June having received $150 million, mostly from registries and registrars, which was $5 million more than it had budgeted for.

Fixed, variable and transaction-based fees accounted for most of the difference. Registrars sold more domains than ICANN predicted, and fewer registries and registrars cancelled their contracts.

Verisign of course was the biggest contributor, accounting for over a third of revenue — $49 million for .com/.net fees alone. On the registrar side, GoDaddy contributed over $11.2 million.

GoDaddy’s contribution is actually a little higher than all the 131 participating ccTLDs’ voluntary donations combined, which came in at $11 million.

Expenses were $125 million, against a budget of $143 million. That was mostly due to the fact that two of its three meetings were held entirely online, so ICANN didn’t have to pay its staff and volunteers’ travel expenses.

It spent $3 million on meetings in the year, against a $10 million budget.

When the budget was passed in May 2021, ICANN had expected all three meetings to take place in person, with international travel “unrestricted” despite the pandemic.

Expenses were also affected by a lower-than-expected headcount. Average headcount was down by three on FY21 at 389, compared to the 405 predicted by the budget.

Despite the over-performance at the operating level, ICANN’s balance sheet actually declined compared to a year earlier.

It had funds under management of $505.5 million compared to $520 million, having lost $29 million due to “investment declines in the Reserve Fund due to volatility in the financial markets”. Its portfolio is still $9 million ahead compared to five years ago, however.

Whois Disclosure System to cost up to $3.3 million, run for one year

ICANN has published its game plan for rolling out a Whois Disclosure System ahead of next week’s ICANN 75 public meeting in Kuala Lumpur.

The Org reckons the system will take nine months to build and will cost up to $3.3 million to develop and run for two years, although it might wind up getting shut down after just one year.

The Whois Disclosure System, previously known as SSAD Light, is a mechanism whereby anyone with an ICANN account — probably mainly IP lawyers in practice — can request unredacted private Whois data from registrars.

The system is to be built using retooled software from the current Centralized Zone Data Service, which acts as a hub for researchers who want to request zone files from gTLD registry operators.

ICANN’s design paper (pdf), which contains many mock-ups of the likely user interface, describes the new system like this:

Just as in CZDS, a requestor navigates to the WHOIS Disclosure System web page, logs into their ICANN Account, and is presented with a user experience much like the current CZDS. In this experience, requestors can see pending and past requests as well as metadata (timestamps, status, etc.) associated with those requests. For a requestor’s pending requests, they can see all the information related to that request.

Requests filed with the system will be routed to the relevant registrar via the Naming Services Portal, whereupon the registrar can choose how to deal with it. The system doesn’t change the fact that registrars have this discretion.

But the system will be voluntary for not only the requesters — who can still contact the registrar directly if they wish — but also the registrars. One can imagine smaller and frequently abused registrars won’t want the hassle.

The cost of this system will be $2.7 million in staffing costs, with $90,000 in external licensing costs and another $500,000 in contingency costs. Because ICANN has not budgeted for this, it will come from the Supplemental Fund for Implementation of Community Recommendations, which I believe currently has about $20 million in it.

This is far and away cheaper than the full-fat SSAD originally proposed by the GNSO, which ICANN in January estimated could cost up to $27 million to build over five years.

While cheaper, there are still substantial questions remaining about whether it will be popularly used, and whether it will be useful in getting private Whois data into the hands of the people who say they need it.

ICANN is saying that the Whois Disclosure System will run for one year “at which point the data sets collected will be analyzed and presented for further discussion between the GNSO Council and Board”.

The design paper will be discussed at multiple ICANN 75 sessions, starting this weekend.

ICANN director’s registry CEO job up for grabs

DotAsia is looking for a new CEO after 15 years of operation, DI understands.

Edmon Chung has been made Acting CEO and the board of the registry will start looking for a replacement by October 7, according to a source.

I’m told the board passed a resolution last week stating: “In pursuit of the fundamentals of transparency, accountability and fair competition, and in the DotAsia community best interests, the CEO contract should be put for open tender”.

Chung, who joined ICANN’s board of directors a year ago, will not be barred from reapplying for his job.

DotAsia, which of course runs .asia, was one of the successful registries in ICANN’s 2003 “sponsored” gTLD round.

The TLD launched in 2017 and currently has around 200,000 domains under management.

The DotAsia Organization in a non-profit entity with a complicated organizational structure involving several Asian ccTLDs.

New ICANN contracts chart the death throes of Whois

Whois is on its death bed, and new versions of ICANN’s standard contracts put a timeline to its demise.

The Org has posted proposed updates to its Registrar Accreditation Agreement and Registry Agreement, and most of the changes focus on the industry-wide transition from the Whois standard to the newer Registration Data Access Protocol.

We’re only talking about a change in the technical spec and terminology here. There’ll still be query services you can use to look up the owner of a domain and get a bunch of redactions in response. People will probably still even refer to it as “Whois”.

But when the new RAA goes into effect, likely next year, registrars and registries will have roughly 18 months to make the transition from Whois to RDAP.

Following the contract’s effective date there’ll be an “RDAP Ramp-up Period” during which registrars will not be bound by RDAP service-level agreements. That runs for 180 days.

After the end of that phase, registrars will only have to keep their Whois functioning for another 360 days, until the “WHOIS Services Sunset Date”. After that, they’ll be free to turn Whois off or keep it running (still regulated by ICANN) as they please.

ICANN’s CEO and the chair of the Registrars Stakeholder Group will be able to delay this sunset date if necessary.

Most registrars already run an RDAP server, following an order from ICANN in 2019. IANA publishes a list of the service URLs. One registrar has already lost its accreditation in part because it did not deploy one.

There’ll be implementation work for some registrars, particularly smaller ones, to come into compliance with the new RAA, no doubt.

There’ll also be changes needed for third-party software and services that leverage Whois in some way, such as in the security field or even basic query services. Anyone not keeping track of ICANN rules could be in for a sharp shock in a couple of years.

The contracted parties have been negotiating these changes behind closed doors for almost three years. It’s been almost a decade since the last RAA was agreed.

The contracts are open for public comment until October 24.

ICANN throws out prostitution complaint

ICANN has rejected a complaint from a man about a web site apparently offering prostitution services.

As I reported last month, the American had filed a Request for Reconsideration with ICANN’s board of directors after his complaints to Compliance about Namecheap were rejected.

He’s unhappy that US-based Namecheap won’t take down the domain adultsearch.com, which operates as a marketplace for sex workers, many of whom are offering services that may well be illegal in most parts of the US.

But ICANN’s Board Governance Committee rejected the complaint (pdf) for lack of standing.

While the ruling is procedural, rather than substantive, the BGC does spend quite a lot of time tying itself in knots to show that while the complainant may well believe prostitution is harmful to society in general, he failed to state how he, specifically, had been harmed.

The decision also directly references the part of the request the requester has specifically asked to be redacted (but was not).

Did a sexy Russian spy nerf the o.com auction?

It’s been over three years since Verisign won the right to auction off the domain name o.com for charity, and so far there’s no sign of a sale. Could a pro-Trump conspiracy theorist’s affair with a Russian spy be the reason?

The .com registry operator received permission from ICANN for a one-off auction — a unique exception to the decades-old convention that single-character .com domains are reserved — in March 2019, and that was the last we heard of it.

There’s been no announcement of an auction date, and neither ICANN nor Verisign have mentioned it since.

I asked Verisign a couple of weeks ago what the company’s plans were and at the weekend received the reply: “Thanks for reaching out and your interest is noted. Once there is an update, we will reach back out to you.”

I don’t think I’m getting into conspiracy theory territory to suggest that the reason for the lack of movement is that the domain’s most likely buyer, the man most likely behind Verisign asking ICANN’s permission in the first place, lost his job a few months after the auction was approved.

When in 2017 Verisign filed its request with ICANN it was widely believed to be primarily the result of a pressure campaign by Patrick Byrne, then-CEO of online retailer Overstock.com, that had gone on for over a decade.

Byrne had been nagging Verisign and ICANN to let him register the domain since at least 2004, as this published correspondence (pdf) illustrates.

Former senior ICANN staffer Kurt Pritz later recounted how Byrne “slid a check for $1,000,000 payable to ICANN across my desk” to persuade a then-broke ICANN to release the name, around the same time. The offer was rebuffed.

Byrne’s obsession with o.com continued, but in 2010 he seemed to throw in the towel briefly when Overstock paid relaunching Colombian ccTLD operator .CO Internet a whopping $350,000 for the domain o.co, which Overstock promptly rebranded around.

Overstock even purchased the naming rights to the Oakland Coliseum baseball stadium, which was known as the O.co Coliseum from 2011 to 2016.

But rebranding is always a risk, not least when it’s to an unfamiliar TLD, and Byrne admitted in 2012 that the move had been a huge mistake.

“O.co was my bad call,” Byrne said at the time, adding that “about eight out of 13 people who were trying to visit us through O.co, eight were typing O.com”.

So when Verisign got the nod to sell o.com, you might have expected Byrne to be champing at the bit.

But in August 2019, Byrne quit Overstock after it emerged he had been in a sexual relationship — according to him encouraged by shadowy FBI agents — with a Russian woman half his age convicted in the US of being a spy in 2018.

Byrne admitted the reportedly three-year relationship with Maria Butina, who after her release from US prison became a member of Russia’s parliament with Putin’s United Russia party, in August 2019. It’s a pretty wild story.

He quit his job at Overstock, the company he had founded, at the same time and a month later sold all his stock in the company.

Byrne has since gone on to be a full-time conspiracy theorist, including reportedly being one of several people who, in December 2020, had a bizarre White House meeting in which they attempted to explain to then-President Trump how the 2020 election had been stolen — the birth of the “Big Lie”.

That was reportedly the first time he had met Trump. There’s no evidence I’m aware of that he had the president’s ear while Verisign was asking his administration to lift the price freeze on .com domains, which it did in 2018.

Conspiracies aside, it’s undoubtedly true that Byrne’s resignation means Verisign has lost its most motivated bidder for o.com, so an auction would likely prove disappointing, unless Oprah Winfrey is feeling particularly frivolous.

Google reveals launch dates for two new gTLDs

Google is slowly working through its backlog of unlaunched new gTLDs, this week announcing go-live dates for two dormant strings.

.boo and .rsvp will both follow the same launch schedule, with month-long Sunrise periods for trademark owners beginning October 4 and general availability starting November 15.

There will also be Early Access Periods, where names can be secured early for daily-decreasing premium fees, running from November 8 to November 15.

Google Registry described .boo as for those “building a website for love, laughs, or a surprise”, while .rsvp is for customers “celebrating a wedding, throwing a fundraiser, or accepting bookings for their business”.

They appear to be among the lightest-touch Google TLDs in terms of restrictions.

Google has been sitting on both gTLDs for over eight years.

Ducos a shoo-in for GNSO Council chair

The next chair of ICANN’s GNSO Council will be GoDaddy’s Sebastien Ducos.

Ducos, who manages TLD clients for GoDaddy Registry, will stand unopposed for the role after the GNSO’s Non-Contracted Parties House decided not to field a candidate.

The election, which seems a formality, will take place at the end of ICANN 75, the Org’s Annual General Meeting, in Kuala Lumpur and Zoom next month.

Australian Ducos has been a vice-chair of the Council since the last AGM.

He will replace Philippe Fouquart, an employee of Orange from the NCPH, after his second one-year term ends.

There hasn’t been a contested election for Council chair since 2018.

ICANN rushes mystery directors onto board in apparent bylaws breach

ICANN is hurrying two new directors onto its board despite that fact that hardly anybody, apparently including the people who this week gave them the nod, seemed to know who they are.

The Org also seems to have technically breached its bylaws with the timing of the move, which also sees chair Maarten Botterman appointed for another three-year term.

Earlier this week the Empowered Community Administration, which has broad powers to hire and fire directors, submitted ICANN-drafted letters formally approving this year’s Nominating Committee picks — Botterman, Christopher Chapman and Sajidur Rahman.

But I’m told that the ECA, like the rest of us, were not given any information by ICANN about the two newcomers beyond their names and the geographic regions they hail from. They were basically waved onto the board blind, it seems.

Photographs subsequently published on the NomCom web site confirm the two directors’ identities. They’re the former head of the Australian Communications and Media Authority Chris Chapman, and Indonesian venture capitalist Sajid Rahman of MyAsiaVC.

Judging by the ICANN bylaws, approval by the ECA — which comprises one person from each of the ASO, the ccNSO, the GNSO, the ALAC and the GAC — is pretty much just a rubber-stamp. All the due diligence is done by NomCom and the Org.

But the appointments appear to amount to a technical bylaws breach on timing grounds, coming about a month late. The bylaws state:

At least two months before the commencement of each annual meeting, the Nominating Committee shall give the EC Administration (with a copy to the Decisional Participants and Secretary) written notice of its nomination of Directors for seats with terms beginning at the conclusion of the annual meeting, and the EC Administration shall promptly provide the Secretary (with a copy to the Decisional Participants) with written notice of the designation of those Directors.

This year’s AGM will be held in Kuala Lumpur from September 17, with the new directors taking their seats at its conclusion on September 22. So NomCom seems to have missed its “at least two months before” deadline by a month. ECA approval came August 15.

This year’s AGM is a little earlier than usual, which may help explain the problem. They’re usually held in October or November, and there hasn’t been one held in September since 2001.

NomCom also missed the two-month window in 2020, by an even bigger margin, for entirely understandable pandemic-related reasons. It announced its selections just a couple of weeks before the AGM.

ICANN staffing up for next new gTLD round

ICANN has started hiring staff to support the next round of new gTLD applications.

The Org this week posted an ad for a “Policy Development Support Analyst” who will “track generic top-level domain policy proposals and contribute to capacity development in the civil society and noncommercial communities”.

It also appears to be still looking for a “Senior Director, New gTLD Subsequent Procedures”, with an ad first posted in June.

The latter is almost certainly a revolving-door type of opening, where somebody with deep, long-term insight into the industry and ICANN would be the likely hire.

ICANN describes it as a “highly visible role requiring a high degree of organization, leadership experience, management and communications acumen, and subject matter knowledge” where the successful candidate “will provide leadership and direction over multiple tracks of organizational activities toward implementation of a subsequent round of ICANN’s New gTLD (Generic Top-Level Domain) Program”.

The newer, more junior opening appears to have a broader remit, with the focus on non-commercial stakeholder engagement as well as the new gTLD program.

The two jobs are among 35 currently being advertised by ICANN.