[CPWG] Subsequent Procedures Update: Applicant Support Program, snapshot as at 26 Jul 2019

[Evan Leibovitch]

I was one of the two co-chairs of the original Applicant Support program WG
in 2010 and believed strongly in it, Strong enough that we created a joint
ALAC-NCSG-GAC group that convinced the Board to introduce the concept over
the objection of the domain industry.

But things have changed, dramatically, since then. Based on that experience
I challenge the ongoing relevance of Applicant Support as an end-user issue
worthy of attention from At-Large.

We have the following lessons learned from the past experience and the
aftermath of the last round:

   - The intended beneficiaries of the AS program are *only* TLD registry
   applicants -- not registrars or registrants, and certainly not end-users;

   - Given the existence of ccTLDs for every country and continental TLDs
   for Africa, Asia and Europe, the market need to create additional new
   registries to serve developing economies has not been demonstrated;

   - We now have a number of gTLDs targeting registrants for whom cost of
   domains is a barrier. Creating these low-cost-model registries did not
   require Applicant Support;

   - The last WG agonized over making regulations tough enough to prevent
   exploitation by applicants that didn't need subsidy, while still making it
   accessible to those that did. We utterly failed at this to the extent that
   NOT ONE registration for applicant support was delegated and less than five
   even made an attempt. Coming up with a new magic formula is simply not
   worth the massive effort to both develop and defend from the inevitable
   attack. (I vividly remember an early meeting we had on this at ATLAS 1 in
   Mexico, during which one registry applicant observer in the back of the
   room calmly said, "no matter what you come up with we'll find a way to game
   it." In hindsight he was absolutely correct, the only regulations that
   could prevent gaming were so tough that NOBODY could meet them. This
   situation has not changed since the last round; in the new discussion
   document the anti-gaming component remains contentious and unresolved (and
   IMO unresolvable);

   - Applicant Support was intended to reduce the cost of the initial ICANN
   fees but not the ongoing maintenance costs or ICANN per-domain fees. Even
   the new proposals that suggest extra support for application writing etc do
   not include ongoing support beyond application. Given the emergence of
   unstable TLDs from the last round, any applicant viable for the long term
   will need to demonstrate financial stability based on the total cost of
   running a domain, of which the fee reduction of Applicant Support is a
   fairly small proportion. There are serious and valid concerns about the
   stability of any TLD applicant who would not be able to apply without the
   Applicant Support fee reduction;

   - The registrant projections for new-TLD registrations have proven to be
   wildly overblown, and the sustainability promises of new applicants need to
   be evaluated with that in mind.

Some of these realities were learned during the Applicant Support WG's
tenure, others were revealed later as the application round unfolded.
Regardless of source, we now have observable realities that did not exist
before the last round and would be ill-advised to ignore them.

I find the conclusion fairly clear. There is no market-based justification
for the Applicant Support program, indeed it threatens stability by
introducing registries on financially shaky ground. As a result. any
ongoing support for Applicant Support -- by ALAC or anyone else -- is
solely for emotional reasons such as community pride. These may be strong
incentives but at least let's go in with open eyes.

- Evan




On Sun, 28 Jul 2019 at 23:56, Justine Chew <justine.chew at gmail.com> wrote:

> Dear all,
>
> Reference is made to an earlier email with subject "Draft Issues List for
> Subsequent Procedures".
>
> I have attempted to generate a *snapshot of where the Subsequent
> Procedures PDP WG is at in its deliberations on the Applicant Support
> Program as at 26 Jul 2019
> <https://community.icann.org/download/attachments/111390697/01.%20SubPro%20Applicant%20Support%20as%20at%2026.07.2019%20for%20CPWG.pdf?version=1&modificationDate=1564311734000&api=v2>*,
> post its last WG call on 25 Jul 15:00 UTC.  Please note that that this
> snapshot is not intended to reflect a complete picture as deliberations on
> the same topic will continue on the next SubPro PDP WG Call of 29 Jul 20:00
> UTC.
>
> At-Large members on the SubPro PDP WG are encouraged to attend the SubPro
> PDP WG call of 29 Jul 20:00 UTC, to help support the ALAC/At-Large inputs
> on the Applicant Support Program and/or help flesh out more concrete
> recommendations for the Program, seeing that this is one of the topics for
> which At-Large has helped to drive in respect of the new gTLD application
> round of 2012 and has continued to provide substantial input.
>
> After the said SubPro PDP WG call, I will attempt to present an updated
> snapshot at the next CPWG call.
>
> Thank you,
> Justine Chew
> -----
>
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