RE: [ga] VeriSign May Ditch Domain Deal

["Gomes, Chuck" <cgomes@verisign.com>]

Roberto,

You have identified a potential problem going forward but not one that has
occurred to date and one I think can be avoided in the future as well.  I
know we disagree on this point.  The main purpose of my question of course
was to challenge the assertion that the separation of Registry and Registrar
has not worked.  I still contend that it has worked very well.

Chuck

-----Original Message-----
From: Roberto Gaetano [mailto:ga_list@hotmail.com]
Sent: Thursday, May 17, 2001 5:03 PM
To: cgomes@verisign.com; wsl@cerebalaw.com; bmj@keyname.net
Cc: ga@dnso.org
Subject: RE: [ga] VeriSign May Ditch Domain Deal


Chuck Gomes wrote:
>
>Please give me an example that proves that the current separation between
>Registry and Registrar does not work.


Let me try.

I think that the current separation between Registry and Registrar does work

well *under-the-circumstances-it-has-been-created-for* (i.e. as long as it 
is a temporary measure that has allowed introduction of competition at the 
Registrar level within a reasonable timeframe).
It was intended to allow the Registrars who participated in the testbed (and

in the initial phases of full competitive operations), to operate in a level

play field (well, in a "not-too-tilted" field).

Outside of the limited timeframe that was intended for this situation, it 
will constitute a bias.
Seen in the long term, it will give the company that owns the Registry *and*

a Registrar a definitive competitive advantage. And this simply because it 
gives the possibility to NSI/Verisign to plan in advance common strategies 
between the R-y and the R-ar parts, to make full use of synergies, to share 
know-how, and so on.
The competitive advantage of NSI-the-Registrar over the other testbed 
Registrars was not in the possibility of NSI-the-Registry unfairly blocking 
other Registrars or unfairly privilege NSI-the-Registrar (about which I will

comment below), but in the fact that NSI Registrar had already the knowledge

of the environment, operations and protocols that would have been put in 
place, knowledge that the others did not have.

This is a situation that cannot continue in the future. Technological 
change, commercial/technical solutions, and what else, can be put in place 
by Verisign-the-Registry after consultation (or at least full awareness) of 
Verisign-the-Registrar, and here lies the competitive advantage. This is why

vertical integration has been a no-no since the early days (as Director 
Kraaijenbrink put well in MdR).

I would also take this opportunity to comment on the alleged irregularities 
that were brought to the attention of ICANN in Melbourne.
Let me state that I do not believe that any irregularity took place, because

of two reasons, one subjective, and the other objective.
The subjective reason is that the irregularities would have been made under 
the responsibility of Chuck Gomes, and that I absolutely trust his moral 
integrity (and I am sure not to be alone on this).
The objective reason is that we can claim a lot of bad things about NSI, but

surely not that they are silly. And to take the risk of badly mess up the 
testbed, under the very eyes of the whole Internet community, and this just 
for registering few hundred names (a drop in the ocean), would have been the

masterpiece of sillyness.
It would have been like Schumacher to take the risk of landing on the grass 
in Zeltweg to try to pass Montoya ... well, on second thought, maybe that's 
not a good example ;>)

Anyway, in summary, the firewall between R-y and R-ar was good enough as a 
temporary measure. Now we need a more definitive guarantee against vertical 
integration and potential monopoly position: full separation of the business

interests.
And this not because of the risk of abuses, which will anyway fall under the

jurisdiction of the courts, but as a guarantee of transparency and good 
health of the competitive marketplace.

Best regards
Roberto
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