[Gnso-newgtld-wg] New gTLD Subsequent Procedures PDP WG Consensus Call - Closes Friday, 08 January 2021 at 23:59 UTC

[Susan Payne]

Dear All
Thanks to WG leadership, Cheryl and Jeff, all the work track leads, Emily, Steve and all our support staff, and to the WG members who have devoted so many hours to this herculean effort.

Like, I imagine, many others, the recommendations from the PDP do not always reflect my preferred outcomes but can, to the most part, be accepted as a suitable compromise.  A number of other WG members have already voiced their opposition to recommendation 35.4 regarding the use of second price sealed bids for ICANN Auctions of Last Resort, to which I add my objections.

I do not believe that any problem has been identified for which a second price, sealed bid process would provide a solution and, like Kurt, I am concerned that the WG, without the benefit of expertise in this complex field, is making a recommendation favouring a specific type of auction operation without there having been any real assessment of the impact.

If there are to be second price sealed bid auctions, however, I am strongly opposed to the timing for the submission of those bids reflected in recommendation 35.4.  Requiring applicants to submit a bid so early in the process and without the benefit of all relevant information is unfair, does not allow applicants to properly assess the appropriate level of their bid, and does not allow for changing circumstances with the passage of time between bid and auction. The submission of bids before applicants know whether any of the other contention set applicants will fail evaluation, a LRO or other Objection process, or otherwise withdraw, means that bids are based, potentially, on a false understanding of the number of applicants in the contention set. The identity of the other applicants in the contention set is also directly relevant information for an applicant in determining what they should bid.  This is particularly so where an applicant is a dotBrand.  From the brand owner applicant's perspective this is not a commodity and there is not, necessarily, a single price they are willing to pay since there are numerous risk-based factors that have to be weighed-up, including the identity of the other applicants, their past history (positive or negative) in this space, the type of business model they are proposing, the existence, or lack, of measures they propose to apply to safeguard against confusion with the brand, and so on.  Furthermore, this appears to have been proposed as the solution to a theoretical rather than an actual problem, i.e. collusion and bid rigging, there being no evidence presented that this actually occurred.

Many thanks

Susan Payne
Head of Legal Policy

Com Laude | Valideus
28-30 Little Russell Street
London WC1A 2HN
United Kingdom

D: +44 20 7421 8255
E: susan.payne at comlaude.com<mailto:susan.payne at comlaude.com>
www.comlaude.com<http://www.comlaude.com/> | www.valideus.com<http://www.valideus.com/>

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