[CPWG] PIR/Ethos

[Alan Greenberg]

Perhaps of interest, I sent the following message to the ICANN Board 
of Directors today.

Alan

At 20/01/2020 09:44 AM, Alan Greenberg wrote:
>To: ICANN Board
>
>This message is being sent purely on my own behalf. I do not expect 
>a personal reply commenting on this issue but I did want to share a 
>few thoughts.
>
>With the various assurances that Ethos Capital has made, I was 
>starting to feel comfortable that the sale might not come back and 
>bite us. However, with the recent revelations of the complexity of 
>the corporate structure and the multiple partners (and loans) 
>involved, the odor has started to rise again.
>
>When I look at the transaction (and I am ignoring here any public 
>relations aspect in relation to ISOC, PIR or even ICANN), I see a 
>number of possible very unfortunate consequences.
>
>1. Price increases: Perhaps inevitable after the decision to remove 
>pricing limitations, I have found that the statements made by Ethos 
>are less than direct. I have heard multiple times that 10% increases 
>could (in the extreme) result in the wholesale price doubling in 10 
>years. That is not accurate. The 10% would in fact be compounded and 
>this could result in a 2x in 8 years, 3 x in 13 years and 4x in 16 
>years and 6x in 20 years. Perhaps such an increase would harm sales 
>sufficiently to cause caution on Ethos' part but I am disturbed that 
>the actual numbers are not being mentioned. But as I said, it is too 
>late to change this, regardless of owner.
>
>2. The largest potential harm I see is to the perceived nature of 
>the TLD. There is no restriction on who can register a domain under 
>.org, but when you look at the .org domains that show up in real 
>life (my own contact list, web searches, etc.), almost all of them 
>are not-for-profit type-organizations or individuals. Rarely do you 
>see an out-and-out business using a .org domain. It is the reason I 
>registered alangreenberg.org and used .org for the domain name of my 
>local genealogical society. And it is why you find .org used for 
>ISOC (and that predates PIR), ICANN, Wikipedia and the Internet Archive.
>
>That is, in my mind, a core strong strength of .org, and one that 
>has been well supported by PIR under ISOC control. However, the lure 
>of profit may make it extremely attractive to try to transform .org 
>into another .com. With just 7% of domains under .org compared to 
>.com, the name space is wide open with far fewer name conflicts. If 
>it is marketed as a more generic TLD (as opposed to the very 
>targeted marketing for .org to date), it could grow - a lot! And 
>along the way very quickly loose its current perceived nature. The 
>lure of capturing just a small fraction of the .com market, with its 
>annual gross revenue of over $1.1B will be very difficult to ignore.
>
>Ethos has stated that it will preserve the "nature of .org". Those 
>assurances are perhaps comforting but non-binding. However, far more 
>important is the new information that Ethos may not be calling the 
>shots and those other entities who may have control have made no 
>such assurances at all.
>
>I will not comment on whether ICANN should approve the sale or not. 
>The Board has far better insight and advice than I can provide. But 
>if the sale does go through I believe it is essential that it 
>include binding, non-cancellable requirements that the "nature" of 
>the TLD be maintained and efforts not be made to transform it into a 
>true generic, commercially-oriented domain. It will sure be 
>difficult to word that in a way as to "guarantee" that it be 
>honored, but I feel confident that it can be done such that, if the 
>intent is violated, the TLD operator could face the potential for 
>having their contract revoked.
>
>Alan Greenberg