<div dir="ltr"><div><div><div> ICANN Reserve Fund – My Comment on Rationale and Target Level<br><br>I have reviewed the <a href="https://www.icann.org/public-comments/reserve-fund-2017-10-12-en" target="_blank">open comment webpage</a>, read the attachment <a href="https://www.icann.org/en/system/files/files/draft-reserve-fund-12oct17-en.pdf" target="_blank">https://www.icann.org/en/<wbr>system/files/files/draft-<wbr>reserve-fund-12oct17-en.pdf</a>, and reviewed other sources of information. I will concede upfront that I probably have a more
conservative approach than many in the ICANN community who appear
"ready to spend" ICANN's last red cent! <br><div><br></div><div>For
example, without more information, the comparison of ICANN to CIRA, or
Nominet, appears ludicrous. ICANN is a unique global organization with
immense exposure and unknown, unquantifiable, potential liabilities due
to: 1) end of the U.S. government (IANA) contract; and 2) expansion of
new gTLDs beginning in 2014 (adding complexity to a system often
increases fragility or vulnerabilities). In addition, ICANN is (along with
Verisign) one of the most important root server operators upon which
the global internet DNS depends. Malicious threats and vulnerabilities,
some <a href="https://en.wikipedia.org/wiki/DNS_hijacking" target="_blank">attacking (or hijacking) the DNS root</a>,
continue to appear. Network science and technology will continue to
evolve, as will vulnerabilities. Research, defense, security, continual
improvements, and <b>incident recovery</b>, cost money, and catastrophic
incident insurance coverage is probably not a viable option. Issues
such as have arisen with the Root Zone KSK Rollover, are just the tip of
the iceberg. Any event that forced ICANN to seek protection under
Chapter 11 of the U.S. Bankruptcy Code could very well end ICANN's role
in "coordinating" the internet. For that reason alone, it might be
advisable for ICANN to consider "spinning off" its technical and root
server operations into a separate "affiliate" (similar to, but separate
from, PTI).<br></div><br>For the reasons above, I would suggest, at a minimum, an "<a href="http://www.nonprofitaccountingbasics.org/reporting-operations/about-operating-reserves-nonprofits" target="_blank">operating reserves fund</a>" of 24 months Opex. In addition, I suggest ICANN consider creating a "<a href="https://en.wikipedia.org/wiki/Strategic_reserve" target="_blank">strategic reserves fund</a>"
of $200 million--funded from the auction proceeds ($235M) and
application fees ($128M)--of which $100 million could be released for
disbursement after five years if there proves to be "no need" for that
level of "strategic reserves," with the balance released five years
thereafter if not needed.<br></div>Sincerely,<br></div>John Poole<br></div>Domain Name Registrant and Editor,<i> </i><a href="http://www.DomainMondo.com">DomainMondo.com</a><br><div><div><div><div><div><br></div></div></div></div></div></div>