“We’re not homophobic!” ICANN pleads as it throws out .gay appeal

ICANN has refused dotgay LLC’s latest appeal against adverse .gay decisions, and has taken the unusual step of preemptively defending itself against probably inevitable accusations from gay rights groups.
On Monday, the Board Governance Committee threw out dotgay’s Request for Reconsideration, in which the company had asked for a third crack at the Community Priority Evaluation process that could have seen it win .gay without paying at auction.
Today, BGC chair Chris Disspain published a blog post that’s basically a defense against accusations that ICANN is somehow intolerant or ignorant of gay issues.
The post explains the RfR process, explains that the latest decision doesn’t mean there won’t be a .gay or that dotgay won’t win the contention set, winding up:

I want to make clear that the denial of the Request for Reconsideration is not a statement about the validity of dotgay LLC’s application or dotgay LLC’s supporters. The decision means that the BGC did not find that the CPE process for dotgay, LLC’s .GAY application violated any ICANN policies or procedures.
It is ICANN’s responsibility to support the community-developed process and provide equitable treatment to all impacted parties. We understand that this outcome will be disappointing to supporters of the dotgay LLC application. We appreciate the amount of interest that this topic has generated within the ICANN community, and we encourage all interested parties to participate in the multistakeholder process to help shape how future application rounds are defined.

dotgay’s two CPEs, which were evaluated by the Economist Intelligence Unit, failed because the company defined its “community” too broadly, to include people who aren’t gay.
The company says that it’s “common sense” that “gay” is an umbrella term not only for lesbian and bisexual people, but also for people with non-standard gender identities and straight people who support equal rights.
(As an aside, I recently learned that former boxing promoter Kellie Maloney, the UK’s poster girl for transgender issues, disagrees with same-sex couples raising kids and once called for gay pride marches to be banned. I wonder how she fits under this umbrella.)
But the second EIU panel “determined that the applied-for string does not sufficiently identify some members of the applicant’s defined community, in particular transgender, intersex, and ally individuals”.
The CPE application fell apart on that basis. It scored 10 of the available 16 points, four points shy of a winner.
Due to the sensitive nature of this kind of thing, and the fact that dotgay does have a truckload of genuine support from prominent campaigning members of its community, ICANN and the EIU have come in for criticism.
Some of that criticism has implied that ICANN, the EIU, the process or all three are in some way homophobic or at least ignorant.
An article on gay news website The Gayly this week said: “The EIU’s actions contradict all common sense and are being interpreted as the outcome of a hostile environment.”
dotgay encouraged supporters to tweet: “Say NO to unfair & unequal treatment of the gay community at the hands of @TheEIU #Yes2dotgay”.
I’ve seen some tweets from supporters that use stronger language, which I’m guessing is what the BGC is trying to preempt today.
Now that it has exhausted the RfR process without success, expect dotgay to file an Independent Review Process appeal with ICANN, delaying the .gay contention set resolution for a year or more.

DCA sues ICANN for fraud, demands cash

New gTLD applicants may have signed away all their rights to sue ICANN, but that doesn’t seem to be a concern for loose-cannon .dotafrica .africa applicant DotConnectAfrica.
The company has filed suit in California, trying to kill off rival ZACR’s application as “fraudulent” and demanding a load of cash from ICANN.
The suit was filed January 20, and DCA’s request for an emergency restraining order has already been thrown out by the judge.
DCA is basically attempting to re-litigate the Independent Review Process case it won against ICANN last year.
The company claims that ICANN, ZACR, independent evaluator InterConnect Communications, and the Governmental Advisory Committee improperly ganged up on it, in breach of contract.
It also claims fraud, negligence, and a few other alleged violations of the law on the same grounds.
It’s looking for three flavors of monetary damages and “rescission of ICANN’s registry agreement with ZACR as a null and void contract predicated on fraud.”
The IRP panel ruled last year that ICANN breached its bylaws by kicking out DCA’s application based on GAC advice that had not been properly and transparently explained.
The case revealed that ICANN had drafted a letter of support for the African Union Commission to submit in order to show its support for ZACR.
ICANN claims there was nothing improper about that — and the IRP panel did not express an opinion — but it looked pretty dodgy.
The organization says it has not yet been formally served with DCA’s complaint, but told the court that there’s no need for an emergency TRO against .africa being delegated because it’s not an imminent possibility.
Indeed, there’s no danger of ZACR getting .africa live while DCA’s application is undergoing a second round of InterConnect scrutiny for evidence of governmental support (which it does not have).
ICANN added in its filing, almost as an aside, that DCA has signed away its right to sue.
DCA’s new choice of law firm, post-IRP, may be an indication of either the fragile nature of its standing or dwindling cash reserves.
Pricey ICANN-killer Arif Ali is out. Replacing him, a dude who runs a website-free, six-month-old, one-man show from his home in a California cul-de-sac.
Disclosure: DCA thinks I’m a racist, and I think it’s mad. The long, sordid history of the company’s shenanigans can be perused at your leisure with this search.

Windfalls still biggest money-spinner for M+M

Minds + Machines is still pulling in most of its cash from one-time new gTLD auction defeats, according to its latest trading update.
The company yesterday reported billings for 2015 of $7.92 million, up from $5.03 million in 2013.
But the company brought in $9.15 million by pulling out of private new gTLD auctions, where the winning bid is shared among the losers. That’s down from $37.5 million in 2014.
“Billings” is the money make at the point of sale, rather than audited revenue which is recognized over the life of the registration. Revenue numbers will come in April.
For the fourth quarter, sales of both premium and standard-fee names were up.
Premium names were up 215% at $1.52 million, which standard name billings were up 184% at $2.66 million.
The company said its registry business ended the year with 278,523 names under management, a 158% increase on year-ago numbers.
M+M met or beat its “key performance indicator” targets in terms of average revenue per name (both standard and premium) and sales growth.
However, the Chinese market boom caused it to miss its market share KPI.
It blamed missing the low end of its 3% to 5% new gTLD market share target by half a percentage point on the rapid growth of China.
The money being pumped into domain names from China in the second half of last year tends to favor the budget end of the new gTLD market, where names can be picked up for cents, whereas M+M’s TLD mix is skewed a little higher.
M+M said last week that it plans to open an office in China soon.

$41m auction loser tries to slam brakes on .shop

Lawyer-happy gTLD applicant Commercial Connect has put GMO Registry’s $41 million purchase of the new gTLD .shop in jeopardy by filing an appeal with ICANN.
On January 26 — the day before the .shop auction — the Connecticut-based company filed an Independent Review Process complaint with ICANN, asking a panel of judges to enjoin ICANN from delegating .shop or even signing a registry contract with GMO.
It’s applied for “emergency” relief. Its full IRP complaint has yet to be filed.
GMO won a seven-way ICANN auction for .shop last week, agreeing to pay $41.5 million into ICANN coffers.
The IRP news will not be particularly surprising for anyone who has followed the .shop contention set closely.
Commercial Connect has deployed pretty much every legal avenue available to it in order to win .shop, which had eight competing applications.
It applied as a “community” applicant, but unsurprisingly failed to meet the stringent criteria that a Community Priority Evaluation requires.
It scored a measly 5 out of the 16 available CPE points, missing the 14-point target.
The company also spunked goodness knows how much cash filing 21 formal objections against other gTLD applicants — ridiculous complaints that “.supply” or “.セール” or “.services” were “confusingly similar” to .shop.
It actually managed to win two of its string similarity challenges, when panelists apparently decided to write their judgments before their morning coffee had kicked in.
It was probable that .shopping and .通販 would be confused with .shop in the mind of the average internet user, these panelists decided.
The .通販 decision was thrown out when sanity prevailed, but the .shopping decision stood. Only a recent back-room deal between Uniregistry and Donuts prevented the .shop auction being a head-explodingly confusing mess.
Now, with its IRP, Commercial Connect is claiming that the whole CPE system goes against ICANN rules.
According to its initial complaint, the fact that the CPE adjudicator, the Economist Intelligence Unit, came up with its own supplemental “CPE Guidelines” means that the the CPE system is not “ICANN policy” and should therefore be disregarded.
At first glance, it seems weak. But I said the same about the DotConnectAfrica IRP case, which DCA won.
IRP panels have been known to be somewhat “activist” (not necessarily a bad thing) recently, so it’s hard to call which way they will swing in any specific case.
But it does seem quite possible that the emergency relief that Commercial Connect requests — that is, no .shop contract until the IRP is over — will be granted.
For GMO, that means it’s just spent $41.5 million on a gTLD it probably won’t be able to launch for well over a year.
It’s perhaps interesting that Commercial Connect doesn’t seem to make any reference in its IRP to its original 2000-round application for .shop.
If that comes up in future filings, it could open up an entirely new can of worms.

Donuts adds two millionth domain

Donuts today said that it has added its two millionth new domain name registration.
The domain in question was schedule.holiday, the company said.
The number appears to refer to fresh registrations, not including renewals, across all of its TLDs.
Its first batch of gTLDs launched about two years ago.
The registry currently has 192 new gTLDs, 185 of which are in general availability, according to DI records, making the average haul about 10,000 names per TLD.
If we were talking $20 per registration (an estimate, as Donuts doesn’t publish its registry fees), the company would have made $40 million from new regs.
That’s not including its sunrise fees, renewals, or recurring premium-fee domains, of course.
It spent almost $57 million just on ICANN application fees.
It expects to wind up with about 200 by the time the current application round ends.
Its best performer to date is .guru, one of its first to launch, which has about 65,000 names in its zone file today and, according to Donuts, over 67,000 names in total.

UN group supports community .gay bid

An organization representing staff members of the United Nations has come out in support of dotgay LLC’s struggling community application for the .gay gTLD.
UN-GLOBE comprises UN employees who identify as “lesbian, gay, bisexual, transgender, and inter-sex”. Its primary goals are pushing for equal rights for these groups within the UN system.
In a letter to ICANN (pdf) earlier this month, the organization said it supports dotgay’s application, despite its Community Priority Evaluation being rejected twice.
The Economist Intelligence Unit’s judging panel has kicked out both of dotgay’s CPEs on the grounds that the applicant’s definition of “gay” includes straight people, and straight people aren’t gay.
But UN-GLOBE, echoing dotgay’s own view, wrote:

We also express our disagreement over the results of the Community Priority Evaluation of October 8, 2015 that rejected dotgay LCC’s community application based on its narrow analysis of the term gay. The term gay should be understood globally instead, as it is generally understood by the internationally diverse lesbian, gay, bisexual, transgender, queer, intersex, and ally (LGBTQIA) community represented in dotgay LLC’s application.

It might be worth noting that UN-GLOBE makes no mention of its own membership including “allies” — that is, people who are not LGBTQI but nevertheless support equal rights — in its letter or on its web site.
dotgay currently has an outstanding Request for Reconsideration against its latest CPE loss, which is expected to be decided by ICANN’s Board Governance Committee on Monday.
If ICANN closes the door on more appeals, the .gay contention set will go to auction where its rivals are Rightside, Top Level Design and Minds + Machines.
One way or another, there will be a .gay gTLD, the only question is whether it will be restricted to approved “gay community” members or open to all.

.shop gTLD sells for record $41.5 million

The nine-way fight for the .shop gTLD has raised $41.5 million at auction.
It’s the most-expensive reported new gTLD sale to date.
The victor was GMO Registry of Japan, which runs a few Asian geographic gTLDs and acts as service provider for over a dozen dot-brands.
GMO wanted .shop so badly it actually applied twice for the gTLD in the 2012 application round.
Only two bidders, GMO and an unidentified rival, were prepared to pay over $15 million, according to ICANN.
The previous record-holder for an ICANN gTLD auction was .app, which Google bought for a smidgen over $25 million last February.
Dozens of contention sets have “self resolved” via private auction, but the winning bids of those are typically not disclosed.
According to GMO’s .shop application, .shop will be an open, unrestricted namespace. The company seems to be planning to sell value-added e-commerce services in addition to domain names.
But domainers will not be welcome in the gTLD. GMO’s application reads:

Registration of a .SHOP domain name solely for the purpose of selling, exchanging, trading, leasing the domain name shall be deemed as inappropriate use or intent.

The company plans to do random spot checks to make sure no registrants are breaking this rule.
GMO is using CentralNic as its back-end registry services software provider, following a 2013 deal.
Radix, Famous Four, Donuts, Google, Amazon, 2000-round applicant Commercial Connect and a company called Beijing Jingdong 360 had all applied for .shop.
But according to ICANN only seven of the original applicants qualified for the auction.
One of the drop-outs was GMO itself. The company has actually applied for .shop twice — once as a regular applicant and once as a “community”.
The non-community application was the one that participated in the auction.
Unsuccessful community applicant Commercial Connect, which has been fighting for .shop since first applying for it in 2000, also did not participate.
On Tuesday, it filed a futile Request for Reconsideration (pdf) with ICANN, complaining about the fact that it lost its Community Priority Evaluation.
.shop was originally linked to .shopping, due to a badly decided String Similarity Objection, but that contention set was resolved separately by Donuts and Uniregistry last week.

ICANN tests emergency registry with dead dot-brand

ICANN is running a test of its Emergency Back-End Registry Operator program, using the dead dot-brand gTLD .doosan as its guinea pig.
Doosan Group, a large Korean conglomerate, decided to kill off its gTLD, .doosan, last September. ICANN revealed the news in October.
The dot-brand had never been put to productive use and really only ever had nic.doosan live.
As it’s a dot-brand, it’s protected by the part of the Registry Agreement that prevents it being transferred to another registry operator.
Rather than letting the gTLD slip away into the night, however, ICANN is taking it as an opportunity to test out its EBERO system instead. ICANN says:

Simulating an emergency registry operator transition will provide valuable insight into the effectiveness of procedures for addressing potential gTLD service interruptions. Lessons learned will be used to support ICANN’s efforts to ensure the security, stability and resiliency of the Internet and the Domain Name System.

EBERO is the process that is supposed to kick in when (or if, I guess) a gTLD with a significant number of third-party registrations goes out of business and no other registry wants to take it over.
The EBERO provider takes over the running of the TLD’s critical functions for a few years so it can be wound down in an orderly fashion, giving registrants enough time to migrate to other TLDs.
Nominet, one of the designated EBERO operators, has taken over .doosan for this test, which is only a temporary measure.
Its IANA record was updated today with Nominet named as the technical contact and ICANN as the sponsor and administrator. Its name servers have switched over to Nominet’s.
Right now, www.nic.doosan resolves to ICANN’s EBERO web page. The non-www. version doesn’t seem to do anything.
ICANN said it will provide updates when the test is over.

Two new gTLD registries open offices in China

Portfolio gTLD registries Famous Four Media and Minds + Machines have both announced that they’re formally entering the Chinese market.
Both companies are establishing “wholly foreign-owned enterprises” (WFOEs), a form of company that does not require local investment, on the mainland.
The moves are aimed at getting the registries’ respective gTLDs accredited by the Chinese government, something that is required before local registrants are allowed to use them.
In a press release, FFM senior legal counsel Oliver Smith said:

It was clear to us soon after launching our first domain registry that domain registrations from China comprised a strong proportion of the total. It was a natural progression of our strategy to build a physical presence in China. The accreditation process is complicated but well-structured and, thanks to the help of advice from the Chinese government, should be completed relatively quickly.

In some of Famous Four’s gTLDs, Chinese registrars are the overwhelming majority of the sales channel.
In .win, the registry’s biggest-seller, China was responsible for about 85% of registrations at the last count, for example.
Meanwhile, M+M is taking a slightly different route into the country.
It said today that while it also shortly plans to open a WFOE, it has also partnered with ZDNS, a local provider of proxy services for registries.
ZDNS was the company XYZ.com partnered with for its controversial launch into China. According to M+M, it’s also working with .CLUB Domains and some Chinese gTLD registries.
M+M is also using the specialist consultancy Allegravita for its marketing there.
Its local entity will be called Beijing Ming Zhi Mo Si Technology Company Limited (which may or may not translate to something like “Wise Mediation”).
M+M’s first Chinese launches will be .beer, .fashion, .fit, .law, .wedding, .work and .yoga, with .vip and .购物 (“.shopping”) coming later in the year.

Fox promises dot-brand will be “the next big thing”

Fox seems set to become an unexpectedly early adopter of its dot-brand gTLD, .fox.
The only live .fox web site, nic.fox, is currently promising that the gTLD will become “the next big thing” in “Spring 2016”.
On the site, a glossy, quick-cut show-reel of Fox media carries the text:

Cue the lights. Roll the cameras. The next big thing is coming. And you’re invited. Welcome to .FOX. Spring 2016.

.fox will be a “a trusted digital space for everything you love about Fox” the site promises.
It suggests that Fox content in DVD, Blu-ray and Digital HD formats will be available via .fox web sites.
.fox has only been in the root since late November; its owners have not so far appeared to be champing at the bit to get their dot-brand online, and Fox has not exactly been enthusiastic about new gTLDs.
Its IP lawyers were some of the most outspoken critics of the program in its early days, estimating they would have to spend millions of dollars on defensive registrations.
Not only has that not happened, but Fox now seems to be grasping the “trusted source” dot-brand sales pitch with both hands.
It’s going to be interesting to see not only what the company has up its sleeve, but also how extensively it is promoted.