[bc-gnso] RE: Important--Registry Registrar Separation issue

[Mike Rodenbaugh]

George, your ranting and accusations are outrageous.  They really do not
deserve even the credence of a response, but I will respond since you have
publicly accused me of unethical conduct and I take that seriously.

My firm and I do not have a direct financial interest in this issue, or any
policy issue around newTLDs, even if I only were a 'wannabe registry
operator'.  My and my firm's interests in the issues have been disclosed
long ago, and are fairly minimal in relation to my overall business -- far
from causing a conflict of interest that could hinder my elected duties or
participation as a BC member.  Rodenbaugh Law is not going to apply for any
newTLDs for itself, and neither am I.  

Nobody is paying me or my firm to lobby for them with respect to any ICANN
policy issue.  Anyway, any public policy statement from the BC would be a
BC-adopted position, not my own, and I would be bound to vote in favor of
any BC-adopted position on the Council, as I always have.

The BC did argue that the new TLD rollout should be delayed until legitimate
economic studies were done, and until better anti-abuse mechanisms are in
place.  Obviously, ICANN has a different view than you and I as to whether
their studies were adequate or legitimate, but they have been done.
Anti-abuse measures remain critical.  I assume that better
anti-cybersquatting and anti-abuse rules will be in place, but that also
seems far from reality at moment.  If those conditions are met, the BC has
long taken the position that newTLDs should be allowed.

.mobi, .asia, etc. exemplify how there is nothing wrong with registries
withholding valuable domain names from landrush.  I understand that domain
investors (including many ICANN accredited registrars) naturally would want
the ability to buy up valuable domains for their businesses, as quickly and
cheaply as possible.  But auctions are more fair than landrush for the most
coveted domains, and new registries should be able to maximize the value of
their generic names.  Generally that ought to benefit all of the registrants
and registrars of that registry, and the broader community.

How would this harm any other legitimate business interest?  In fact it
should benefit broader business interests by introducing long term
competition to .com, opening up IDN TLDs, allowing new marketing
opportunities, developing new uses of the DNS, etc.  Specifically, spreading
the relatively few 'good' domains among more people is of greater benefit to
almost everyone.  

Other than cybersquatting and abuse, I see nothing of concern generally with
newTLDs, and many likely benefits.  You and a few others can keep arguing
against them, but new TLDs are most likely going to come next year anyway.  

Meanwhile you please should stop wasting everyone's time with your
repetitive rants.  The BC and ICANN have heard your positions, and are
obviously not persuaded.  Repetition is not going help persuade anyone.  

The point of this discussion was to debate important rules, if any, that
will govern these new TLD business ventures.  Many members are interested in
that debate, to much greater degree than the ranting of one member,
rehashing old refuted arguments and making frivolous accusations.  So, back
to the discussion about registry-registrar separation, as hopefully others
have substantive comments please?

Thanks,
Mike

Mike Rodenbaugh
Rodenbaugh Law
548 Market Street
San Francisco, CA  94104
+1.415.738.8087
www.rodenbaugh.com

-----Original Message-----
From: owner-bc-gnso at icann.org [mailto:owner-bc-gnso at icann.org] On Behalf Of
George Kirikos
Sent: Sunday, August 02, 2009 6:29 AM
To: BC gnso
Subject: Re: [bc-gnso] RE: Important--Registry Registrar Separation issue


Hello,

On Fri, Jul 31, 2009 at 4:24 PM, Mike Rodenbaugh wrote:
> I have been asked by several people
> whether the BC is going to comment.  The issue is generally open

Once again, you've failed to identify who asked, and in what forum those
comments are going to be made. There are no open comment periods on this
topic. If it was someone from ICANN that asked, you should fully disclose
who it is, since ICANN has a duty to "operate to the maximum extent feasible
in an open and transparent manner". If instead it's one of your clients that
is asking and you continue to refuse to identify, that just illustrates the
conflict of interest. What good reason exists to keep this context secret?

> The next formal opportunity might be in comment to the next iteration 
> of the Draft Applicant Guidebook, probably in late September.  But 
> Staff could prepare a paper in the meanwhile, and certainly is 
> discussing this issue internally in regards to the next Guidebook 
> draft.  They might care what we think.

So, you're suggesting ICANN staff might care. Are they the ones who asked?
Why wouldn't they simply read the comments made by BC members who actually
made comments on time? If the next opportunity for formal comments is the
next iteration of the Guidebook, it would seem prudent to wait and see what
it says, before wasting time speculating on what may or may not be in that
guidebook.

> I thought the issue was important to discuss, and hadn't seen that 
> discussion happen.  If any consensus comes of it, we can consider if 
> anyone wants to draft a position.  I do not have any conflict of 
> interest in this issue.  Any interest I have is disclosed in my 
> statement of interest (which has not changed for more than a year).  
> If that changes, I will post to this list.

Of course it's important to you, as it could reduce the profitability of
wannabe registry operators (people like yourself and your clients) if
existing registrars could compete with you for new gTLDs. Do you actually
know what a "conflict of interest" even is? You have a direct financial
interest in the outcome of this policy for yourself and your client, yet you
say you have no conflict?

> There is nothing wrong with new registries withholding valuable domain 
> names, auctioning them, developing them, or otherwise exploiting them.  
> The

"Exploiting" was a nice choice of words, as it keenly demonstrates what the
entire new gTLD process is about, exploitation of consumers, IP holders,
etc. Why isn't the BC pushing for those "economic studies"
which ICANN has promised yet failed to deliver? I know numerous BC members
in their comments to ICANN stated that those studies needed to be completed,
as did the DOC/DOJ/NTIA. Oops, I guess that would push back the new gTLD
rollout, and affect wannabe registry operators, people like you and your
client.

Is it a shock that you would find "nothing wrong" with new registries
auctioning off the most valuable domains, i.e. like .mobi, .asia, etc., when
that just coincidentally happens to be perfectly aligned with your interests
as a wannabe new TLD operator, and that of your client? That must have taken
an enormous amount of thought indeed "What makes us the most money?" instead
of looking at the broader policy issues for consumers, the public,
businesses, registrants, etc.

> alternative is that a few registrar conglomerates and sophisticated 
> domainers get the bulk of them during the first ten minutes of landrush.
 I do not think that is an issue of consumer harm or antitrust, it is simply
reality.

Once again, the false choice that it's only door #1 (the registries
profit) or door #2 (the registrars and "domainers" profit). Here's a door #4
(in addition to competitive tenders previously discussed): why not auction
the domains of any sunrise/landrush, BUT have 100% of the proceeds go to
charities selected by all gTLD registrants (i.e.
com/net/org/biz/info/etc. in proportion to the number of domains they own)?
Oh horror of horrors, what would these wannabe registry operators do, to run
a real registry operation that has price caps (ala com/net/org) past the
first 100,000 registrations i.e. the cream of the crop that in your words
need to be "exploited". What value do registry operators create whatsoever
on those first 100,000 names, e.g. a Verizon.shop which Verizon *has* to
defensively register at premium sunrise costs (or otherwise waste money on
legal fees later)?
Or on the short domains or dictionary word domains? The registry operator
does nothing in creating that "value" -- that value was already there, i.e.
it's a one-time goldmine that was already sitting there. Take that away, and
it ruins the parasitic business models of most wanna-be registry operators.

> Between the two groups, new registry operators should get the rewards 
> of investing in the registry, and so should be able to do anything 
> they like with the names in that registry, subject to minimum 
> anti-abuse standards and contract compliance.   Accredited registrars 
> are free to offer

Wow, what a shocker, you plan to be a registry operator, and come down on
the side of registry operators. "Should be able to do anything they like"
demonstrates that it's not the public interest that is at stake, it's giving
private for-profit companies complete ownership of a TLD, i.e. ala .tv, etc.
where price caps aren't in effect.

Certainly price caps are a far more important issue than this sideshow, yet
price caps and economic studies aren't of concern to you? Oh, right, price
caps and economic studies are of interest to other BC members, but not to
wannabe gTLD registries. No conflicts of interests, you say, are you so
sure?

>  I would prefer that the BC adds our voice to the debate, since that is
our purpose.

I recall that on October 1, 2008, that you had made a statement (which I
won't quote, but members can find by searching for the word "derogatory" in
their archives, or the "M Rodenbaugh:
Superconstituency strawpoll" subject of that day) which was very apt.

Soon, you and your client will presumably be a member of the Registry
Constituency, Mike, if your gTLD ambitions are realized. Thus, your views on
this topic within the BC should be seen in that light by other members who
are "real businesses", i.e those that fit the section 3.2 specificity
criteria of our charter (like my company and other companies).

I repeat that our constitiency's Divisional Separation rules say that
entities "will only represent user or consumer perspectives within the
Business Constituency". If you're a wanna-be gTLD registry operator, or have
a sister company that is a registrar or an ISP, it's clear that those
respective positions should be taken outside of the BC, and folks should be
recusing themselves here. Otherwise, the BC simply becomes a battlefield for
outsiders to try to gain influence within another constituency.

Obviously that recusal extends to Mike R. not being rapporteur on this
topic, due to the obvious self-interest.

If folks are bored this summer and want to have the BC issue a statement on
a topic, I suggest we make a clear and convincing statement on the topic of
price caps, which is far more important than this thread (or pick one of the
several topics that actually have an open comment period, like eUDRP, etc.
where the constituency has not submitted any comment!). My company is in
favour of price caps, obviously the ICA has spoken against them. Given
Verizon's statement on the IRT:

http://forum.icann.org/lists/irt-final-report/msg00220.html

(page 5) that "Given that some registries will inevitably use the sunrise
process as an opportunity to extract excessive defensive registration fees
from trademark owners, the standard sunrise should be in addition to and not
in lieu of other RPMs. We urge that ICANN to restrict registries from
engaging in anticompetitive pricing strategies during the sunrise period.
Registries should not be able to charge much more during a sunrise period
than the cost of a registration after the sunrise expires."

I'd say that's likely another BC member in favour of price caps, especially
if eliminating them for new gTLDs would have the effect of allowing VeriSign
to charge $1 Billion/yr for Verizon.com, i.e.
unrestricted .tv style pricing for .com as a punishment to all existing .com
holders, that some people are willing to see happen as long as they can get
their own TLDs to operate.

I think the folks who are arguing for new TLDs need to be very clear, are
they:

1) in favour of new TLDs, or
2) in favour of new TLDs if and only if their company gets one for
themselves (or their clients, etc.), or they can make money doing consulting
for new TLDs, as all these new TLDs need help with paperwork, lawyers, etc.

There's a weeeeee difference, don't you think? If you're for #2, you start
saying all kinds of wacky things, like "Oh, of course, registries *should*
be able to charge $5 million/yr for hotels.newTLD, isn't that obvious?
(wink, wink) And they *should* be able to raise prices anytime they want!"

If instead you're for #1, then your positions start to be moderate, how do
we do so in a manner where the benefits outweigh the costs. We start looking
at economic studies (where are the economic studies ICANN promised?). We put
in safeguards. We see that the maximum benefits go to consumers, not those
looking to extract excessive registration fees from registrants.

Sincerely,

George Kirikos
416-588-0269
http://www.leap.com/