[council] Questions from RySG on JAS

Neuman, Jeff Jeff.Neuman at neustar.us
Wed May 11 15:23:50 UTC 2011


The RySG had a short discussion on the JAS Working Group Report this morning and we want to reiterate our support for the principles and objectives of the Working Group.  That said Stephane and Wolfe have raised some key issues with the report and we have the following additional questions set forth below.   We believe that it would be much faster and more efficient for all of these questions to be answered by the JAS Working Group prior to the document going out for community review and before being forwarded to the Board by the GNSO.

Therefore, at this point we cannot support the motion as written.

Please let us know if you have any questions.


Comments on the Report

3.2 Notes on Financial Need
The overriding consensus of the WG is that financial need and capability is the primary criteria for determining eligible applications. Such need and capability is to be demonstrated through the following criteria:

 1.  Applicants must be capable of of contributing $45,000 towards ICANN's application fee, unless ICANN waives, or lowers application fees.
 2.  Where applicants anticipate scheduled fees, such as for extended evaluation, the applicant must be capable of contributing a quarter of the scheduled fees.

[RYSG]  How was this determined? Is it sufficient to demonstrate viability? Some explanation of the WG thinking on this would be helpful.

 1.  Applicants must be capable of of contributing $45,000 towards registry operational costs, if the applicant proposes to operate its own registry platform. If the applicant proposes to share registry operational costs with other qualified applicants, the applicant must be capable of contributing the pro rated proportional share of this cost.

[RYSG] Is the $45,000 amount an annual figure?  It might make up a very small percentage of operational costs.

 1.  Applicants must be capable of of contributing $45,000 towards registry continuity operational costs, if the applicant proposes to fund its own continuity operation. If the applicant proposes to share registry continuity operational costs with other qualified applicants, the applicant must be capable of contributing the pro rated proportional share of this cost.

[RYSG] It would be helpful to explain the basis for the $45,000 amount.
Part 4 - What benefits do qualified applicants receive?
The WG recommends a number of different kinds of support to be made available for eligible applicants, which fall into the following categories:
4.1 Financial support/relief from ICANN
4.1.1 - Cost Reductions
The WG recommends the following fee reductions to be made available to all applicants who are determined as meeting the criteria established for support:

 *   Waive (consensus for this in the Milestone report) the Program Development Costs (US$26,000)
 *   Lower risk/contingency cost (US$60,000)

[RYSG] If these contingency funds are actually needed at the amount estimated, where would the deficit come from?

 *   Review Base cost (US$100,000) to see if reduction can be made
 *   Cost reductions to encourage the build out of IDNs in small or underserved languages.

[RYSG] Does the WG believe that costs will be less for 'IDNs in small or underserved languages'?  If not, what is being suggested here?

 *   Lower registry Fixed Fees

[RYSG]  Assuming the fees are reasonable with regard to services provided to registries, would other registries be expected to make up the deficit?  Or does the WG believe the fees are too high?  If the latter, was any analysis done to support that position?

 *   Exemption or deferment of IPv6 implementation requirements as possible

[RYSG]  Could this put the registry at a competitive disadvantage compared to registries that support IPv6?
Further reductions recommended

 *   Reduction of the Financial Continued Operation Instrument Obligation to 6-12 months

[RYSG]  What if the registry fails?  Does the WG suggest a higher tolerance for failure in exchange for a smaller continued operation obligation?

4.1.2 - Staggered Fees
Instead of paying the entire fee upon acceptance of the applications, applicants meeting the criteria established for support could pay the fees incrementally. Staggered fees payment enables an applicant to compete for strings that might otherwise have gone to the first and/or only group with enough money to apply.

[RYSG]  Staggered over what period of time?  What happens if progress payments are not made on time?

Part 5 - Evaluation process and relationship to the new gTLD Applicant Guidebook (AG)
The WG has determined, at this time, that best possible process to provide support for such applications is to be done through a process that is parallel to, and not a replacement of, the ICANN Applicant Guidebook. Thus, even after the Guidebook is formally approved, this WG can continue its work to refine those components of its mandate which remain unresolved. It is important that the AG make mention of this program and refer interested potential applicants to it, however it is not the WG's intention to otherwise affect the existing application process. To qualify for support applicants may be required to demonstrate that they meet this program's criteria on financial need and public interest; however such activity is intended to supplement, not replace, existing mechanisms in the AG.
The WG had full consensus that Applicants that receive support under this program should repay that support as possible, and that such repayments go into a sustainable revolving fund used to support the future applications. Repayment is dependent on the gTLD Operator's financial success and will take the form of either

 *   a capital contribution or lump sum; or
 *   an income contribution or annual instalment of until a lump sum is repaid; or
 *   repayment of the full or a percentage of the reduced base cost fee expended by the Support Development Program.
The following broad steps did not obtain thorough evaluation or full consensus by the WG, but have been suggested as a starting point to this process and will be further refined by the WG based on the Parts 1 to 4 above. Note the process is meant to be to be in parallel with the AG-

1.     the Application is assessed using the criteria described in Part 3 and this Step takes place before the Application enters the AG process

[RYSG]  Is there enough time for this?

Jeffrey J. Neuman
Neustar, Inc. / Vice President, Law & Policy
21575 Ridgetop Circle, Sterling, VA 20166
Office: +1.571.434.5772  Mobile: +1.202.549.5079  Fax: +1.703.738.7965 / jeff.neuman at neustar.biz<mailto:jeff.neuman at neustar.biz>  / www.neustar.biz<http://www.neustar.biz/>
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