ICANN chair: “all options open” on .org deal

ICANN has not yet decided to approve the acquisition of Public Interest Registry by Ethos Capital, but has not ruled out rejecting the deal either.
That’s according to chair Maarten Botterman, speaking to his Governmental Advisory Committee this evening.
At the online-only ICANN 67 meeting, he was asked by GAC chair Manal Ismail whether ICANN is considering withholding its consent for the $1.13 billion deal, which would see the .org registry return to for-profit hands for the first time in 18 years.
“At this moment all options remain open. We are open-minded to taking all input into account before it is time for us to decide,” Botterman replied.
“ICANN will consider the request based upon the totality of the information received,” he also said.
ICANN has the ability, under its registry agreement with PIR, to reject a change of control such as an acquisition, if it believes it’s not in the public interest.
Critics of the deal believe it would allow private equity firm Ethos and its anonymous backers to price-gouge non-profits such as charities, which need the money more.
But Ethos has offered to cap price increases at 10% per year on average for the next seven years, reimposing a price cap that PIR negotiated its way out of last year.

Could .org debate bring back the glory days of ICANN public forums?

ICANN is going to devote 90 minutes to discussing the controversial acquisition of Public Interest Registry by Ethos Capital on Monday, and the sparks could fly.
It’s actually going to be the first formal session of the abridged, online-only ICANN 67 meeting, which had been due to take place in Cancun but will now be carried out fully online. The customary opening ceremony has been scrapped.
Seventy minutes will be devoted to taking questions and comments from the “room”. ICANN 67 is sticking to Cancun’s time zone and the .org session starts at 1400 UTC, which would have been 0900 at the venue.
ICANN warned that the sessions is devoted to the process ICANN is using to approve, or not, the acquisition, and that it “cannot address questions and comments that relate to the ISOC, PIR, Ethos Capital, or other parties involved in the proposed transfer”.
The deal is controversial largely because critics believe Ethos, as a private equity company, is much more likely to start to rip off .org registrars with price hikes than not-for-profit ISOC. But Ethos has offered to bake conditions into its contract that limit it to 10% increases per year on average.
Given the vast amount of interest in the .org deal from outside the usual ICANN community, we could see the kind of robust debate that was common in the ICANN public forum sessions during the birth throes of the new gTLD program, but which has been sadly lacking in recent years.
Newcomers wishing to get involved might like to first familiarize themselves with ICANN’s Expected Standards of Behavior. Anyone dropping the F-bomb or calling the deal “gay”, as happened during the recent .com comment period, will very likely be kicked and banned. Just imagine you’re talking to Titania McGrath and you should be okay.

Poblete to replace Disspain on ICANN board

Chilean registry manager Patricio Poblete will join ICANN’s board of directors this October, replacing longstanding member Chris Disspain.
The Country Code Names Supporting Organization confirmed Poblete as its new nominee at the weekend following a lengthy election process also fought by Australian Nigel Phair and South African Calvin Browne.
Poblete is the director of NIC Chile, the ccTLD registry for some almost 600,000 .cl domains. He’s been involved in ICANN since its very beginning.
In the election, he received 57 votes compared to Browne’s 42 and Phair’s eight.
Disspain, a very influential member of the board who was vice-chair for years until he stepped aside last September, is being forced out due to term limits in ICANN’s bylaws. He’s almost done serving his third and final three-year term.
Poblete will become one of two ccNSO-selected directors. The other is Nigel Roberts, who runs the Channel Islands ccTLDs. Roberts’ term ends next year.
The nomination frees up a spot for a possible future director from Asia-Pacific, while reducing the available spots from Latin America.

Chinese registrars ask ICANN to waive fees due to Coronavirus

Almost 50 registries and registrars based in China have asked ICANN to temporarily waive its fees due to the economic impact they say Covid-19 — the new Coronavirus — is having on them.
They’ve all put their names to a February 21 letter (pdf) that ICANN published over the weekend, saying they “believe that it’s essential that ICANN provides immediate fee waiver to registries and registrars in China”.
The letter, signed by more than half of the currently accredited registrars in China, notes the cancellation of the Cancun public meeting, adding:

We highly respect and welcome ICANN’s approach to keep our community safe. Meanwhile, the contracted parties in China, including their staff, suppliers, and relevant business counterparts, are being hit and suffered by the 2019-nCoV in a much greater scale than in other countries and regions combined since January 2020. Many of the staff members have been restrained to perform sales and support functions at the level they are required to. There are significant delays in collections, payments and wire transfers. While we expect that the scale of 2019-nCoV could not go greater, the business growth estimate in 2020 has been jeopardized and the time of recovery can be very long.
While domestic aid on tax, rentals, etc. are being discussed and confirmed, we believe that it’s essential that ICANN provides immediate fee waiver to registries and registrars in China. The waiver of 2020 fees, including annual fees and transaction fees, will greatly help stabilize our business in the difficult time.

This is not a small ask. ICANN collects fees based on transaction volume, and many millions of transactions originate in China. That’s particularly true in the new gTLD space, where China dominates.
The Chinese companies say that ICANN could afford to waive the fees due to the money they say ICANN will save by cancelling Cancun and other international travel.
My hunch is that ICANN won’t agree to these demands. While China is currently undoubtedly disproportionately affected by Covid-19, that situation is rapidly changing.
In the coming weeks and months it’s quite possible — worst-case scenario — the rest of the world could be similarly affected. Is ICANN prepared to set a precedent that could see it sacrifice its entire annual budget? I doubt it.
All previous requests for ICANN to waive its fees for various other reasons have been denied.

Most languages won’t be available at ICANN 67

Translation services are the first component of ICANN 67 to fail victim to the org’s decision to hold the meeting entirely online.
ICANN announced last week that it has cancelled the in-person meeting, which had been due to kick off this coming Saturday in Cancun, due to fears about importing Covid-19 into Mexico and exacerbating its worldwide spread.
But it seems the lack of physical space is going to cause problems. It simply doesn’t have the room at its Los Angeles headquarters to accommodate all of its usual services.
There will be eight rooms operating simultaneously via Zoom during the meeting, ICANN said yesterday, and only two of those will have real-time interpretation.
Of the five non-English United Nations languages usually supported — Arabic, Chinese, French, Russian, and Spanish — only French and Spanish will be supported live. Portuguese, which is also usually available, will not be supported.
Sessions of the Governmental Advisory Committee and other high-interest meetings such as open board meetings and the Public Forums, will be given priority.
According to data released by ICANN in December, it appears very few remote participants people actually take advantage of live interpretation.
Of the 1,752 remote participants at ICANN 66, only 15 people tuned in non-English web audio streams and nine of those were listening to the Spanish, this report states. It appears the Arabic interpreter was broadcasting to an international audience of literally nobody.
This, of course, does not take into account how many people were physically in the room and using the live-interpretation headsets ICANN provides. These people will presumably have to switch to the web streams this time around.
Translated transcripts will be available after the meeting, faster than they are normally provided, ICANN said.
It seems that ICANN community members with limited English are going to be hardest hit by the switch to online-only.
Given that these people are most likely reading this article via Google Translate, I’d just like to add for clarity: my lonely moped speedily devours yawning leopards, while gorgeous shoelaces envelope my thorax.

Ethos volunteers for .org pricing handcuffs

Ethos Capital has volunteered to have price caps written back into Public Interest Registry’s .org contract, should ICANN approve its $1.1 billion proposed acquisition.
The private equity firm said Friday that it has offered to agree to a new, enforceable Public Interest Commitment that bakes its right to increase prices into the contract under a strict formula that goes like this:

Applicable Maximum Fee = $9.93 x (1.10n)

The $9.93 is the current wholesale price of a annual .org registration. The “n” refers to the number of full years the current .org registry agreement has been in play, starting June 30, 2019.
In other words, it’s a 10%-per-year increase on average, but PIR could skip a year here and there and be eligible for a bigger price increase the following year.
For example, PIR could up the fee by 10% or $0.99 to $10.92 this coming June if it wanted, but if it decided to wait a year (perhaps for public relations reasons) if could increase the price to $12.13 in June 2021, an increase of $2.20 or roughly 22%.
It could wait five years before the first price increase, and up it from $9.93 to $16.53, a 66% increase, in year six.
While price increases are of course unpopular and will remain so, the formula does answer the criticism posed on DI and elsewhere that Ethos’ previous public statements on pricing would allow PIR to front-load its fee hikes, potentially almost doubling the price in year one.
But the caps have a built-in expiry date. They only run for eight years. So by the middle of 2027, when PIR could already be charging $18.73, the registry would be free to raise prices by however much it pleases.
It’s a better deal for registrants than what they’d been facing before, which was a vague commitment to stick to PIR’s old habit of not raising prices by more than 10% a year, but it’s not perfect and it won’t sate those who are opposed to increased fees in principle.
On the upside, a PIC is arguably an even more powerful way to keep PIR in line after the acquisition. Whereas other parts of the contract are only enforceable by ICANN, a Public Interest Commitment could theoretically be enforced via the PIC Dispute Resolution Procedure by any .org registrant with the resources to lawyer up. Losing a PICDRP triggers ICANN Compliance into action, which could mean PIR losing its contract.
The PIC also addresses the concern, which always struck me as a bit of a red herring, that .org could become a more censorial regime under for-profit ownership.
Ethos says it will create a new seven-person .ORG Stewardship Council, made up of field experts in human rights, non-profits and such, which will have the right to advise PIR on proposed changes to PIR policy related to censorship and the use of private user/registrant data.
The Council would be made up initially of five members hand-picked by PIR. Another two, and all subsequent appointments, would be jointly nominated and approved by PIR and the Council. They’d serve terms of three years.
The proposed PIC, the proposed Council charter and Ethos’ announcement can all be found here.
Correlation does not necessarily equal causation, but it’s worth noting that the proposal comes after ICANN had started playing hard-ball with PIR, Ethos and the Internet Society (PIR’s current owner).
In fact, I was just putting the finishing touches to an opinion piece entitled “I’m beginning to think ICANN might block the .org deal” when the Ethos statement dropped.
In that now-spiked piece, I referred to two letters ICANN recently sent to PIR/ISOC and their lawyers, which bluntly asserted ICANN’s right to reject the acquisition for basically any reason, and speculated that the deal may not be a fait accompli after all.
In the first (pdf), Jones Day lawyer Jeffrey LeVee tells his counterpart at PIR’s law firm in no uncertain terms that ICANN is free to reject the change of control on grounds such as the “public interest” and the interests of the “.org community”.
Proskauer lawyer Lauren Boglivi had told ICANN (pdf) that its powers under the .org contract were limited to approve or reject the acquisition based only on technical concerns such as security, stability and reliability. LeVee wrote:

This is wrong. The parties’ contracts authorize ICANN to evaluate the reasonableness of the proposed change of control under the totality of circumstances, including the impact on the public interest and the interest of the .ORG community.

Now, the cynic in me saw nothing but a couple of posturing lawyers trying to rack up billable hours, but part of me wondered why ICANN would go to the trouble of defending its powers to reject the deal if it did not think there was a possibility of actually doing so.
The second letter (pdf) was sent by ICANN’s new chair, Maarten Bottermann, to his ISOC counterpart Gonzalo Camarillo.
The letter demonstrates that the ICANN board of directors is actually taking ownership of this issue, rather than delegating it to ICANN’s executive and legal teams, in large part due to the pressure exerted on it by the ICANN community and governments. Botterman wrote:

It is not often that such a contractual issue raises up to a Board-level concern, but as you might appreciate, PIR’s request is one of the most unique that ICANN has received.

He noted that the controversy over the deal had even made ICANN the target of a “governmental inquiry”, which is either a reference to the California attorney general’s probe or to a letter (pdf) received from the French foreign office, demanding answers about the transaction.
It’s notable from Botterman’s letter that ICANN has started digging into the deep history of PIR’s ownership of .org, much as I did last December, to determine whether the commitments it made to the non-profit community back in 2002 still hold up under a return to for-profit ownership.
Given these turns of events, I was entertaining the possibility that ICANN was readying itself to reject the deal.
But, given Ethos’ newly proposed binding commitments, I think the pendulum has swung back in favor of the acquisition eventually getting the nod.
I reserve the right to change my mind yet again as matters unfold.

Yup. ICANN cancelled Cancun

ICANN has cancelled its public meeting in Cancun, Mexico, due to fears over Covid-19, aka Coronavirus.
Late this evening, the organization said that the ICANN 67 meeting, scheduled for March 7 to March 12, will now take place purely online.
In a statement, the org said:

Each ICANN Public Meeting attracts thousands of attendees from more than 150 countries. With cases in at least 26 of those countries, there is the potential of bringing the virus to Cancún and into the ICANN meeting site. If this were to happen, there could be accidental exposure of the virus to attendees, staff, and others who come in contact with an infected individual.

ICANN had been putting in place measures to mitigate the risk of the disease arriving and spreading.
The decision to cancel the face-to-face meeting was made by the ICANN board of directors today.
It’s going to be the first ICANN meeting to take place fully online. It’s not clear at all that ICANN knows how to do this. ICANN is very good at enabling remote participation, but it’s never run a fully remote week-long meeting with a few thousand participants before.
It seems virtually certain that there will be problems and complaints.

ICANN wants to take your temperature before letting you into ICANN 67

Face masks, hand-sanitizer stations, and nurses taking your temperature on the doors… these are some of the measures ICANN plans to deploy at its upcoming public meeting in Cancun next month, in an effort to mitigate the risk of a Covid-19 outbreak.
That’s assuming the meeting goes ahead at all, which is still undecided.
Speaking to community leaders in a teleconference this evening, ICANN staffers outlined the following precautionary measures they expect to put in place:

• A doctor from International SOS will be on site, alongside the usual two medics.
• A team of nurses will be deployed at the venue’s two entrances to check attendees’ temperatures (via the forehead, you’ll be pleased to hear) as they enter the building.
• “Anyone registering a fever will be escorted to the doctor for assessment.”
• ICANN is “stockpiling” face masks and is already shipping some to the venue. This is complicated by the global supply shortage. Attendees will be encouraged to source their own before leaving home.
• Hand sanitizer facilities will be dotted around, particularly at large meeting rooms and outside bathrooms.
• A Mexican familiar with the local public health service will be available.
• It will be up to the local Mexican authorities to determine how to respond to a confirmed case. It’s not particularly clear what the policy would be on quarantine and the dreaded “cruise ship scenario”. There have been no cases in Mexico yet.

The temperature checks will be daily. One would assume that people leaving the venue for lunch, or a cigarette or something will be checked more frequently.
ICANN has yet to decide whether the meeting is going to go ahead. Its board of directors will meet on Wednesday to make a call, but CEO Göran Marby noted that should the situation with Covid-19 change there’s always the possibility it could be cancelled at a later date.
The meeting could also be cancelled if a large enough number of ICANN support staff refuse to go.
Some companies have already informed ICANN that they won’t be sending employees to the meeting. Marby said that if it looks like only 600 or 700 people are going to show up, the meeting probably won’t go ahead.
Governmental Advisory Committee chair Manal Ismail said on the call that only 30 GAC members have so far indicated that they’re going to attend. That’s about half of the usual level, she said.
If it were to be cancelled, the meeting would go ahead online. All ICANN meetings allow remote participation anyway, but ICANN has been prepping for the possibility that its online tools will need much greater capacity this time.
The audio recording of the call can be found here. Thanks to Rubens Kuhl for the link.
Are you going to go to Cancun, or will you cancel due to Covid? Let me know in the comments.

ICANN might cancel Spring Break over Covid-19 fears

ICANN’s next public meeting, which is due to kick off in Cancun, Mexico less than three weeks from now, is in peril of being canceled due to fears about Covid-19, aka Coronavirus.
CEO Göran Marby is to host a call with community leaders in a few hours to discuss the issue. ICANN has assembled a “crisis management team” to monitor the spread of the disease.
The fear isn’t that attendees could pick up the virus from Mexican locals — there’s not a single confirmed case in Mexico yet — but rather that an already-infected person might show up and transmit the disease to others, who might then take it back home with them.
Or — even worse — ICANN is considering the possibility of “a ‘cruise ship’ scenario in which a suspected or confirmed case is identified during the meeting, necessitating the mass-quarantine of all attendees and locals”.
That’s a reference to the cruise ship currently anchored off Japan, where 3,400 people have been quarantined for the last couple of weeks.
Imagine that. Trapped at an ICANN meeting for weeks. The boredom might kill more people than the virus.
Given that the vast majority of Covid-19 cases so far — over 70,000 — have been in China, ICANN is also worried about Chinese attendees getting racially profiled and hassled by others.
ICANN notes that the Mobile World Congress in Barcelona has been cancelled, and Cisco has cancelled a conference that had been slated to go ahead in Australia around the same time.
Could ICANN follow suit? It wouldn’t be the first time ICANN has changed is meeting plans due to a virus outbreak. Could ICANN 67 be the first remote-only ICANN meeting? It certainly seems like a possibility.

Verisign shits on domainers, again

It’s probably no exaggeration to say that Verisign makes hundreds of millions of dollars a year from .com domain investors, and yet it’s been developing a habit in recent years of shitting on them whenever it serves its purpose.
The company’s submission to ICANN’s just-closed public comment period on the proposed new .com contract, which re-enables Verisign’s ability to increase its prices, is the latest such example.
In the letter, which is unsigned, Verisign accuses the Internet Commerce Association, as well as registrars Namecheap and Dynadot, of conducting a “deceptive” campaign to persuade .com registrants to submit comments opposing the deal.
It notes that ICA represents “speculators” — it never uses the term “investors” — as if this was some kind of closely guarded secret, and describes the practice of domaining in a way that implies that the practice is somehow “illegitimate”, like this:

More than any other group engaged in the ICANN multistakeholder process, these speculators are highly sensitive to even the smallest wholesale price changes because of the enormous portfolios of .com domain names they control.
…
Speculators sometimes sell these domain name registrations to other speculators, but often they pass these costs along when they sell the domain names to legitimate internet users who wish to use .com domain names to build websites. We believe this resale activity adds little value to the DNS.

It’s not wrong, but good grief! The chutzpah on this company is sometimes jaw-dropping.
It’s like a car manufacturer complaining that its billion-dollar range of off-road SUVs are mostly being used by obese city dwellers for the school run. Just take the billion dollars and stop complaining about your biggest customers!
It’s not the first time Verisign has rolled out this line of attack. Back in 2018, when price caps were being negotiated with the US government, it posted an article on CircleID accusing domainers of “exploit[ing] consumers” and “scalping”.
Verisign’s able to get away with this kind of attitude, of course, because most domainers have an almost erotically slavish devotion to .com. The company could spend all day every day emailing them disgustingly personalized “yo momma” jokes and they wouldn’t stop buying up its product by the millions.
The two sides are trapped in an emotionally abusive relationship but they can’t break up because they’re both making so much goddamn money out of it. They’re like the Clintons of the domain world, in other words.
Anyway, the gist of the company’s comment to ICANN is basically “Ignore the 9,000 other comments you’ve received, the commenters were suckered into writing them by lying registrars”.
Read it here (pdf).
As a matter of disclosure, Verisign cites the DI piece last week about covid-19.com as an example of why domainers suck. That wasn’t the intent of the article, but there you go.