[CPWG] [GTLD-WG] [registration-issues-wg] Verisign DissingDomainers?

Kan Kaili kankaili at gmail.com
Sat Nov 3 10:43:59 UTC 2018 

Hi,

I believe this discussion openes up to a most important and fundamental issue for ICANN and the DNS industry.

We all know the famous theory about the "invisible hand".  That is, the market's invisible hand always wins over the govenrment's visible control.

The ICANN's structure and way of controling domain names' pricing often reminds me of the land sale policy, because they have so many similarities: Each individual ones are unique and irreplacible.

However, just like pieces of land, each domain name obviously have different values.  Thus, their market prices cannot, and should not, be the same.  Thus, although ICANN sets price-caps for registries, but cannot control their market values and prices via registrars or "scalpers".  If this is the case, why should ICANN bother to set price-caps at the first place?

Furthermore, as I understand, the reason that the DNS industry is seperated into "registry" and "registrar" is to prevent registries to monopolize their TLDs.  This is also supposed to protect registrants and end-users.  However, for the same reason, this does not seem to be working.  Just like an acre of land at New York's Time Square cannot be worth the same as one acre in the desert, "premium domain names" cannot possibly be worth the same as most others.  Again, the market's invisible hand wins.

As we already see many registries also play the role as registrars by directly selling domain names to registrants, I wonder what is the reason to maintain this two-layer system.  I believe it does not do much except adding a middle-man in between (and costing more to registrants).

The bottom line is, who owns domain names after all?  I believe, just like land is God's gift to all mankind, domain names belong to all netizens as well.  ICANN, as well as all the registries and registrars, only manage them to keep them in order, including their uniqueness, stability, etc.  Thus, the reason that ICANN and its registries, registrars are entitled to get fees for their management service, not because any one of them owns domain names.

If all the above are true, then there is nothing wrong with domain name "scalpers".  All the unintended consequences come from ICANN and the DNS industry's wrong structure or wrong doing.  

In particular, the main reason of land prices getting too high is more than often because of governments trying to limit its supply, thus creating an artificial scarecity.  Thus, the best way to protect consumers' interest is not to limit its supply and allow its free trade.  I believe the same applies to domain names as well.

Kaili


  ----- Original Message ----- 
  From: Evan Leibovitch 
  To: Alan Greenberg 
  Cc: Jonathan Zuck ; greg at isoc-ny.org ; CPWG 
  Sent: Saturday, November 03, 2018 12:19 PM
  Subject: Re: [CPWG] [GTLD-WG] [registration-issues-wg] Verisign DissingDomainers?


  On one hand, I am delighted to see such an acknowledgement of reality.
  The use of the term "scalpers", while incendiary to some, is revealing in its candor and maybe its intent.
  However I agree that such an opinion is not made lightly, and is unlikely for pure public-service reasons.


  So... why?


  Recently, a CBC investigation of Ticketmaster revealed that the company encourages the hoarding and scalping of tickets to popular events, and itself profits from the activity by getting revenue from the scalped tickets well over and above the original selling prices.


  I see one of two possible related scenarios, both of which are plausible though could be wildly incorrect: 

    1.. Verisign is setting the stage to get a piece of the scalpers' action. It has watched as other TLDs roll out "premium" domains and wants to itself profit from domain sales that are inflated well past original value. It wants what Ticketmaster can do. While a scalper's revenue is a one-time sale per domain, premium domains may be perceived as a sustained-revenue path that allows Verisign to exploit a dominance in TLD space that really hasn't been challenged by the swarms of now registries.


    2.. Verisign may suspect that regulatory reaction (of the governmental kind) against Ticketmaster may bleed into TLD space. There are so many, many similarities between ticket scalping and domaining which is why its use of the term in the blog is so apt. This might be a move to forestall state intervention by indicating that Verisign will be proactive in reducing scalping on its own. The revenue hit may be offset by the good PR and reduced threat of governmental interference.
  Cheers,
  Evan





  On Fri, 2 Nov 2018 at 21:46, Alan Greenberg <alan.greenberg at mcgill.ca> wrote:

    The RAA has always had a provision allowing ICANN to have a Consensus Policy prohibiting reistrars from warehousing or speculation. We have never taken action on this and I cannot see the GNSO ever doing so.

    The Verisign blog is interesting. Rare that a large company publicly disses its largest customers.

    Alan



    At 02/11/2018 03:43 PM, Greg Shatan wrote:

      This post is actually taking aim primarily at REGISTRARS who buy huge numbers of .com domains at wholesale ($7.85 per domain) and then hold them, in order to try and sell them later for a premium price. That’s not really dissing domainers in the general sense, just these registrar-domainers.

      The writing is a bit sloppy on this point, and the blog pivots to ICA toward the end, but even there, the focus is on the registrar-domainers, not on the general domaining public. Look again at the post, and you will see references to “speculators†who buy at a “regulated price.†That’s the Verisign price they are talking about. Regular registrants don’t have that opportunity — onlly registrars. The “Domainer Name Wire†article largely misses this point — partly because the post is vague and partly becausse of a tendency to “rush to judgment†in the domaining press.

      As Jonathan notes, ICA argues it’s protecting the little guy, when they are actually providing loads of protection for some very “big guy†registrar-domainers.

      While this is not “insider trading,†it is really a form of diversion based on insider access — the registrars abuse their privileged position to bbuy cheap and to buy before any “regular†registrant (even a domainer) can, and then they hold this portfolio and charge secondary-market prices for domains that are not really in the secondary market. Registrars’ unique ability to buy domain names directly from the registries was never meant to produce this result. This is a bug, not a feature. The end user domainers should really be pissed off at the registrar-domainers, not at Verisign. (Of course, they are permanently pissed off at Verisign, especially with a price increase in their “commodity.†)

      Maybe registrars should be prohibited from buying for their own account for investment purposes. GoDaddy apparently has 2.5 billion reasons to oppose that idea. 

      I don’t know if I would call them scalpers (though it’s a fair comparison). I see domainers more like the folks in Boston who get up in the morning, sit down in a lawn chair in a prime parking spot near the Fenway Park baseball stadium, and then sit there until game time approaches. Then they charge you $20 or more to get out of the way so you can park there. This is not entirely accurate either since this is a lot more work than a domainer would put in (at least for a single domain name.

      Greg

      On Fri, Nov 2, 2018 at 3:10 PM Jonathan Zuck < JZuck at innovatorsnetwork.org> wrote: 
        We'll, it's not particularly easy to take them back. Blog raises some good points about where the money goes. The ICA rhetoric about small business is pretty silly.

        Jonathan Zuck 
        Executive Director 
        Innovators Network Foundation 
        www.Innovatorsnetwork.org 
------------------------------------------------------------------------

        From: GTLD-WG < gtld-wg-bounces at atlarge-lists.icann.org> on behalf of Carlton Samuels < carlton.samuels at gmail.com> 
        Sent: Friday, November 2, 2018 2:59:12 PM 
        To: cpwg at icann.org; lac-discuss-en at atlarge-lists.icann.org 
        Subject: [GTLD-WG] [CPWG] Verisign Dissing Domainers? 
         
        Um,.......hmmmm, a flag up the pole to see who salute you think?

        Assuming the posting it is sanctioned as official view, what is the end game here? Afterall, they are gifted ownership of every name, known and hitherto unknown, in the .com space! The domainers merely 'rent' them! 


        Hmmm....we have a saying in my corner of empire, 'one hand alone can't clap'. Gotta follow the money.


        https://domainnamewire.com/2018/11/02/holy-sht-verisign-just-called-out-domain-scalpers-and-its-biggest-customers/ 






        ============================== 
        Carlton A Samuels 
        Mobile: 876-818-1799 
        Strategy, Process, Governance, Assessment & Turnaround 
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  -- 

  Evan Leibovitch, Toronto Canada
  @evanleibovitch or @el56


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