[Comments-gtld-subsequent-procedures-initial-03jul18] Comments by XYZ

Grant Carpenter grant at team.xyz
Wed Sep 26 17:49:44 UTC 2018

*XYZ’s COMMENTS ON THE initial Report on the New gTLD Subsequent Procedures
Policy Development Process (Overarching Issues & Work Tracks 1-4)*

XYZ was an active participant in the 2012 round and is now the registry
operator of ten TLDs. With its significant experience in the space, XYZ
offers the following comments on the Initial Report on the New gTLD
Subsequent Procedures Policy Development Process (Overarching Issues & Work
Tracks 1-4).

*--Overarching Issue 2.2.3 - Applications Assessed in Rounds--*

XYZ agrees with The Working Group’s recommendation that the next
introduction of new gTLDs shall be in the form of a “round.” Following such
a round, XYZ is strongly against 2.2.3.d.4, 5 and 6, which each involve
permanently opening up a first-come, first-served process of new gTLD
applications. The future supply and demand for additional new gTLDs is
currently too hard to predict and an indefinite opening up of the supply
could potentially crash the whole market. Accordingly, XYZ recommends any
of 2.2.3.d.1, 2, 3.

*--Overarching Issue 2.2.5 - Application Submission Limits--*

XYZ agrees with the Working Group that there are no effective, fair and/or
feasible mechanisms to enforce such limits and therefore no limits should
be imposed on either the number of applications in total or the number of
applications from any particular entity.

*--Overarching Issue 2.2.6 - Accreditation Programs (Registry Service
Provider Pre-Approval)--*

XYZ strongly supports pre-approval for RSPs and generally takes the
position that ICANN should try to strike the appropriate balance between
ensuring the necessary technical capability of RSPs and allowing for the
entrance of new RSPs to bring competition and innovation to the space.
Additionally, XYZ believes that existing RSPs without a history of
significant technical problems should be grandfathered in to avoid
redundant and unnecessary technical evaluations for the RSPs or the
registries that use them.

*--Overarching Issue 2.5.1 - Application Fees--*

XYZ strongly believes that it against the mission and purpose of ICANN for
ICANN to charge anything more than its anticipated total cost to administer
the application process for the new rounds. Importantly, ICANN must take
into consideration the future revenue that ICANN will take in from auctions
and increased registration volumes when setting initial application
pricing. To do otherwise, would be a deliberate misinterpretation of
Guideline B* designed to overcharge applications and unjustly enrich ICANN.
If ICANN takes in more from application fees and auction income than it
spent in administering the application process, all such money should be
fairly returned to applications. Any other use of the money would be
against ICANN’s mandate and unfair to applicants.

*--Overarching Issue 2.5.4 – Applicant Support--*

XYZ believes that if an applicant is unable to afford any reasonable
application fees, then he applicant is likely to be unable to be able to
afford to operate a TLD. Accordingly, XYZ recommends against the financial
assistance component of the ASP.

*--Overarching Issue 2.7.3 – Closed Generics--*

XYZ is strongly against closed generics, which only help to create unfair
monopolies on generic terms that will benefit only existing large industry
players at the expense of all others. This is very much against the mission
of bringing competition and choice to the space. Also, Closed Generics go
against internationally recognized trademark principles which do not allow
exclusive rights in generic names without acquired distinctiveness. ICANN
should formalize GNSO policy, making it consistent with the existing base
Registry Agreement that Closed Generics should not be allowed.

*--Overarching Issue 2.7.8 – Name Collisions--*

It’s widely known that in the previous round, Name Collisions were
shamelessly used by certain industry powers as an irrational fear-mongering
manipulation tactic to create uncertainty and doubt about the new gTLD
program. ICANN should not fall for this trap again and should not rely on
any technical resources, data, research or other information that come from
or is funded by parties with vested financial interests in the topic.

*--Overarching Issue 2.10.1 – Base Registry Agreement--*

There must be a base RA in place at the beginning of the application
process. Any of the hundreds of provisions in the RA could heavily impact
the economic decisions made by applicants and they need certainty up front
before investing millions of dollars. Given that the existing RA can be
used as a starting point, the work involved should be relatively minimal.

*Grant Carpenter*
General Counsel, XYZ
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