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<TITLE>Summary of BC member comments on Expression of Interest (EOI)</TITLE>
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<FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'>the proposed plan for new gTLD Expression of Interest (EOI) will be discussed in Nairobi and one of the few items likely the Board may vote on.<BR>
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If the BC wants to have approved talking points for the GNSO session and Board forum in Nairobi, we need to start the clock now on our required 14-day comment period. <BR>
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Just in case the membership wants to have an official position in Nairobi, please consider this note a draft of possible position points for discussion. <BR>
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Below I’ve shown major points from submissions by several members during ICANN’s public comment period on the EOI proposal. (Apologies if I’ve missed other member comments. Please bring them up on our BC Member call if this topic merits further consideration.)<BR>
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Philip Shepard, AIM ( <a href="http://forum.icann.org/lists/draft-eoi-model/msg00205.html">http://forum.icann.org/lists/draft-eoi-model/msg00205.html</a> and <a href="http://forum.icann.org/lists/draft-eoi-model/msg00149.html">http://forum.icann.org/lists/draft-eoi-model/msg00149.html</a> )<BR>
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</SPAN></FONT><BLOCKQUOTE><FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'><B>1. Distraction</B> The EOI process should not distract ICANN from the fundamental task of addressing unresolved issues relating to new TLDs such as trade mark protection and malicious conduct. (AIM)<BR>
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<B>2. A true pre-registration</B> The proposed mandatory EOI process with a $55,000 fee is described as a pre-registration suggesting that it is not reversible regardless of the unresolved overarching issues such as trade mark protection and malicious conduct. <BR>
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3. Inconsistency</B> The principle of pre-registration is inconsistent with all previous ICANN practice.<BR>
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<B>4. Ignores market dynamics </B> Brand owners may feel compelled to enter into an EOI purely for defensive reasons, so that they do not suffer when a speculator is given rights in their brand. There seems to be no facility to allow competition for the same domain names after pre-registration. Moreover, pre-registration may tip-off competitors to new business models prematurely.<BR>
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<B>5. A lower than market fee may encourage speculation</B> Speculators may pay $55,000 to secure rights to certain domains instead of $185,000 in the hope of selling on. This is surely not the intent of ICANN’s Board.<BR>
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<B>6. Applicants are forced to invest blind</B> Because there are unresolved issues, the pre-registration model forces applications in ignorance of potential future costs. <BR>
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Ayesha Hassan, ICC ( <a href="http://forum.icann.org/lists/draft-eoi-model/msg00208.html">http://forum.icann.org/lists/draft-eoi-model/msg00208.html</a> ) <BR>
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ICC does not support the implementation of any EoI until the rules for the new gTLD application process are developed and agreed upon by the ICANN community.- It is very difficult for business to evaluate participating in an EoI when new or changed gTLD application rules could significantly impact business plans and models. There are still several important issues that remain unresolved in the current Draft Applicant Guidebook (DAG), and it is not certain they will be resolved by DAG4. (ICC)<BR>
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</SPAN></FONT><BLOCKQUOTE><FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'>An EoI is not a substitute for an independent economic analysis on the demand for new gTLDs, which was requested by the Board in October 2006 to be conducted prior to the launch of an EoI and the first application round. (ICC)<BR>
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Steve DelBianco, NetChoice ( <a href="http://forum.icann.org/lists/draft-eoi-model/msg00233.html">http://forum.icann.org/lists/draft-eoi-model/msg00233.html</a> ) <BR>
</SPAN></FONT><BLOCKQUOTE><FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'>ICANN’s Board should avoid taking a decision on EOI until the threshold question about its purpose is answered –is it data gathering or is it mandatory pre-registration for a specific string? There is no need for disclosure of strings if the EOI is just data gathering. If it is mandatory pre-registration, then ICANN should finish the Applicant Guidebook and Registry Contract before asking applicants to file an EOI with a hefty fee. <BR>
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Chris Martin, USCIB ( <a href="http://forum.icann.org/lists/draft-eoi-model/msg00250.html">http://forum.icann.org/lists/draft-eoi-model/msg00250.html</a> )<BR>
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</SPAN></FONT><BLOCKQUOTE><FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'>the EOI does not adequately recognize the need to have established rules in place in order for potential applicants to adequately assess their business strategies for any potential new gTLD application. The current model also appears to bypass the careful policymaking decisions that must go into the more fundamental questions surrounding new gTLDs. In this way, the EOI process could be viewed as a backdoor to moving the larger gTLD process along without addressing those critical underlying issues, such as ensuring adequate safeguards for trademarks and ensuring the security and stability of the Internet. An EOI also should not hinder the process for addressing these overarching issues and finalizing the rules for new gTLD applications. <BR>
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EOI initiative jumps ahead of more fundamental questions regarding new gTLDs and their effect on consumers, businesses and the security and stability of the Internet and domain name system. <BR>
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USCIB recognizes the potential usefulness of an EOI in gathering data that may inform ICANN about important issues associated with the rollout of new gTLDs. However, USCIB cannot support the implementation of an EOI initiative until the final rules for the application process are fully developed and agreed upon by the ICANN community. Serious issues still remain with the current Draft Applicant Guidebook (DAG), and it is unclear that the ICANN community will reach final consensus by DAG4 on many important issues. As a result, USCIB members question how ICANN can expect potential new gTLD applicants to engage in a mandatory EOI process, with limited terms by which any investment deposit may be refunded, while the rules for applications are not yet finalized. It is extraordinarily difficult for business to even assess participating in an EOI when new or changed gTLD application rules could drastically impact business plans and models. Vague guarantees to tackle key issues before the EOI begins are not enough; ICANN should be explicit in determining exactly what key issues must be final before an EOI begins.<BR>
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two issues cited in the draft model, vertical separation and 3-character requirements for IDN strings, must be finalized before EOI moves forward. The community should agree upon brand protections, rules on background checks, financial disclosures, lack of conflicts of interest, IPv6 and the technical requirements, as well as the ability to maintain a registry. The rules for new gTLD applications must be clear and final before businesses with interests in submitting applications for new gTLDs can participate in an EOI. <BR>
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As a further point regarding the role of an EOI as an information source, ICANN should be careful in recognizing that while an EOI can help provide information on the number of new gTLDs that are likely to be applied for, such an indicator does not equate with public/registrant demand for new gTLDs. USCIB believes that an EOI would measure the demand for supply of new gTLDs, as opposed to the economic demand for new gTLDs themselves. Given this differentiation, an EOI cannot substitute for the promised independent economic analysis on the demand for new gTLDs. ICANN should quickly implement the Board’s October 2006 request that such a study be conducted prior to launching the first application round for new gTLDs.<BR>
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USCIB supports ICANN’s logic in developing parts of its model, such as the need for a reasonable deposit fee and a global communication campaign. USCIB agrees with ICANN’s logic for an EOI fee at a level that balances the competing needs of being high enough to deter speculation but low enough to ensure the fee is not a barrier to entry. The overall EOI should not, however, be a cost-generator and any deposit or participation in an EOI should not be viewed by the applicant as a promise that they will be awarded a new gTLD, nor a basis to engage in raising capital and investors<BR>
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</SPAN></FONT></BLOCKQUOTE><FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'>Mike Palage ( <a href="http://forum.icann.org/lists/draft-eoi-model/msg00124.html">http://forum.icann.org/lists/draft-eoi-model/msg00124.html</a> ) <BR>
</SPAN></FONT><BLOCKQUOTE><FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'>Hmmm... it’s nearly impossible to summarize Mike Palage, but here’s why he says, “Just say No”:<BR>
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The EOI Raises Major Public Policy Considerations on Which the Government Advisory Committee (GAC) Has Not Been Able to Meaningfully Provide Advice.<BR>
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The creation of a secondary market for gTLD applicant slots that could be bought and sold prior to the commencement of the actual new gTLD application process<BR>
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ICANN requesting financial commitment from prospective gTLD applicants prior to the publication/approval of the final Applicant Guidebook<BR>
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The Process Envisioned Violates Article III, Section 6 of the ICANN Bylaws<BR>
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The Proposal Violates Both the Letter & Spirit of the Affirmation of Commitments<BR>
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</SPAN></FONT></BLOCKQUOTE><FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'>CADNA ( <a href="http://forum.icann.org/lists/draft-eoi-model/msg00241.html">http://forum.icann.org/lists/draft-eoi-model/msg00241.html</a> )<BR>
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</SPAN></FONT><BLOCKQUOTE><FONT FACE="Optima, Times New Roman"><SPAN STYLE='font-size:10pt'>CADNA does not believe that ICANN should move forward with the EOI model as proposed. There remain a variety of problems with the Guidebook that ICANN has yet to resolve, including the potential for infringement, malicious conduct, and compromised Internet security. Moving forward with the EOI would undermine the bottom-up policy development process currently at work. ICANN should focus on addressing the concerns that have yet to be adequately addressed and its Draft Applicant Guidebooks, such as the demand for such a launch, its possible effects on the domain name space, business and Internet users alike, and trademark protection concerns. <BR>
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By requiring participation in the EOI for access to the first round of new TLD applications, ICANN is essentially asking applicants to agree to participate without knowing how the final process will take shape.<BR>
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While the EOI is being billed as a process by which to gauge demand, it is not structured in a way that would gather information and study demand; instead, with participation in the EOI mandatory for eligibility in the first application round for new TLDs and a $55,000 price tag, the EOI only serves to move up the process of applying for a TLD. This mechanism will play on the fear of potentially being “left behind,” will artificially inflate demand and ultimately squander the opportunity to genuinely study the demand for new TLDs.<BR>
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demand demonstrated during the EOI may pressure ICANN to move forward with gTLDs before resolving these problems. In the EOI proposal, ICANN states that there is a possibility that parties will push for changes to the Guidebook based on the published list of strings defined during the EOI process. Although ICANN points out that it is important to avoid such an occurrence, it provides no suggestions or ideas for how to go about preventing it. It is crucial that this process is not a black box –all members of the Internet community must have access to the list of applied-for strings and applicants. CADNA recommends that ICANN make this information available as it happens. This would also be beneficial if the way that an EOI application reserves TLD strings is on a first-come, first-served basis. If all members of the Internet community do not have access to the list of applied-for strings and applicants, they will be forced to waste time applying for strings that are already taken. To promote fair competition, potential applicants should have the opportunity to see what strings are being registered so they can better weigh their decision regarding whether to participate in the EOI.<BR>
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For ICANN staff summary of the 370 comments received, see <a href="http://www.icann.org/en/topics/new-gtlds/summary-analysis-eoi-15feb10-en.pdf">http://www.icann.org/en/topics/new-gtlds/summary-analysis-eoi-15feb10-en.pdf</a> <BR>
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-- <BR>
Steve DelBianco<BR>
Executive Director<BR>
NetChoice<BR>
<a href="http://www.NetChoice.org">http://www.NetChoice.org</a> and <a href="http://blog.netchoice.org">http://blog.netchoice.org</a> <BR>
+1.202.420.7482 <BR>
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