RE: [registrars] RC WLS Response

[Nikolaj Nyholm <nikolajn@ascio.com>]

I think it is insufficiently nuanced to write: "in fact the unanimous vote
of all those taking a position - is to oppose the WLS."

I believe that several registrars, ourselves included, were in favour of
working with Verisign on enhancing the WLS, but oppose it in it's current
form.


I hope that alternative proposals ("The RC will address these proposals in a
separate position paper.") will include suggestions on how to revise the WLS
proposal.


Regards
Nikolaj

> -----Original Message-----
> From: Rick H Wesson [mailto:wessorh@ar.com] 
> Sent: 16. januar 2002 05:21
> To: Registrars List
> Cc: WLSDraftingTeam@ar.com
> Subject: [registrars] RC WLS Response
> 
> 
> 
> all:
> 
> attached is the draft response from the WLS Drafting Team composed of
> the following:
> 
>    George DeCarlo - dotster
>    Bruce Tonkin - melbourneit.com.au
>    E. Broitman  - register.com
>    David Wascher - iaregistry.com
>    Paul Stahura - enom.com
> 
> Please comment on the draft as to if this is an acceptable response.
> The WLS Drafting Team used the comments from the meeting and 
> additional
> comments forwarded to them to draft this response.
> 
> If you find a general exception to the response please contact the
> drafting team via WLSDraftingTeam@ar.com
> 
> A text version is included below for ease in quoting. We must 
> finish this
> response by Thursday so that we can formally deliver it to VGRS as
> requested by Friday the 18th of January, 2002.
> 
> Thanks for your corporation.
> 
> -rick
> 
> Rick Wesson
> CTO, Registrars Constituency
> 
> -------------------- txt version of RC-WLS-Response.pdf 
> ---------------
> 
> 
> To Chuck Gomes,
> 
>  The Registrar Constituency (RC) is hereby providing its formal
>  position to the VeriSign Global Registry Services (VGRS) regarding
>  its proposal to manage a Wait Listing Service (WLS), the subscription
>  service for deleted domain names.  VRSN sent its proposal to the
>  Registrar Constituency on December 30, 2001, and allowed registrars
>  to comment until January 18, 2002.
> 
> 
>  The RC has considered the WLS, holding discussions and voting by
>  email and through a conference call.  The overwhelming posi tion of
>  the RC - in fact the unanimous vote of all those taking a position -
>  is to oppose the WLS.  Considering VRSN's obligation under its
>  agreements with ICANN to vet any proposed price increases or service
>  modifications for registry services with ICANN, and ICANN's bottom
>  -up approach, it is the RC's understanding that the RC position will
>  be considered within the Domain Name Supporting Organization (DNSO)
>  before the DNSO would make a recommendation to the ICANN Board, and
>  that the RC position would be a significant factor in ICANN's
>  consideration of the WLS proposal.
> 
>  Prior to reviewing the RC's concerns, it would be instructive to
>  recall the history of this issue.  In Spring 2001, VGRS temporarily
>  shut off registrar connections, preventing new and/or s mall
>  registrars from registering .com, .net and .org domain names.
>  Ostensibly to address this technical load problem VGRS had
>  temporarily closed the process of deleting expired names.  Rather
>  than effectively solving the technical load problem, VGRS implemented
>  an interim solution, relegating batch requests for deleting names to
>  one of three pools to prevent this high -volume traffic from
>  overloading its systems.  But according to VGRS, this solution has
>  not solved the connection problems.  In fact, VGRS is once again
>  announcing that it is limiting connections.
> 
>  The RC has a number of key concerns with WLS: a) price, b)
>  transparency, c) benefit to the Internet, and d) lack of a solution:
> 
>    a) The proposed $40.00 price point for WLS (which is in addition to
>       the $6.00 registry fee) is exorbitant.  VGRS has not justified
>       this price with cost requirements.  Not only does WLS create a
>       much higher price point for the end consumer, it effectively
>       undermines competitive registrars' financial wherewithal.  It is
>       highly u nlikely that registrars would be able to increase their
>       margins in proportion to the increased margin charged by VGRS.
>       In fact, market data (such as the Snapames price point of $49)
>       demonstrates that competitive registrars would have to
>       dramatically lower , or eliminate, their current margins in
>       order to compete for WLS names.  This would undermine
>       competitive registrars' revenues and jeopardize their ability to
>       remain profitable.  * The one registrar that may be able to take
>       effectively advantage of this price is the VeriSign registrar,
>       which continues to enjoy the largest market share. It would be
>       able to use the new higher margin of $46.00 to price below
>       wholesale, as it has in the past with the $6.00 fee.  The result
>       is to unfairly undermine competitor regi strars.
> 
>    b) There would be a lack of transparency if VGRS runs the primary
>       registry, the largest registrar, and the subscription service.
>       As long as the same company is operating this vertically
>       powerful chain of companies, it may be possible for it to shift
>       domain names from the $6.00 registry to the $46.00 WLS.  In
>       fact, only the registry would know all of the WLS subscriptions
>       and the timing for deleting names.  Such information could be
>       abused by its registrar.  Considering that there is a history -
>       some of it still unresolved - of VeriSign not deleting expired
>       names, the RC is doubly concerned that VGRS' operating the WLS
>       provides new opportunities for domain name hoarding.
> 
>    c) The WLS provides an incentive and reward for speculators, while
>       squeezing registrants seeking to build a web presence and
>       registrars (as explained above).  The WLS provides a "sure
>       thing" to Internet insiders who are savvy enough to get to the
>       head of the line.  This primarily means speculators.  They will
>       be willing to pay the adde d $40 fee for a guarantee of getting
>       the expired name if 1) they are sure the name will be deleted
>       and 2) they believe that they can resell the domain name at a
>       higher price.  Insiders will be virtually the only ones able to
>       ensure that a certain name will be deleted.  The end user will
>       still have to pay the market price, which will be determined on
>       the secondary market.  Moreover, the fact that a WLS
>       subscription has been placed on any given name would prompt a
>       speculator holding such domain name to renew it, rather than
>       release it.
> 
>    d) In addition to creating new problems, WLS will not solve the
>       problem of batch pool slamming.  In fact, t here is the
>       potential to create the same technical loading problems on the
>       WLS as currently exist on the main registry.  F or example,
>       there will be competition amongst speculators to be the first to
>       get the WLS on the best names about to be deleted.  There could
>       also be a landrush effect to place WLS on well known popular
>       names, at the moment when the new WLS service goes liv e.
>       Registrars will still compete for the expiring names that do not
>       have WLS subscriptions.  Since it costs the same "to slam" a $40
>       name as to slam a name greater than $40, there is no incentive
>       not to.  Finally, since WLS subscriptions are not tied to a
>       name, this will create many WLS -switches immediately after the
>       zone file is released daily.
> 
>  While the RC opposes the WLS in its current form, it recognizes the
>  need for a permanent solution to the apparent problem of deleted
>  names not being released or b eing released in a manner that
>  undermines other registry functions.  Therefore, the RC welcomes
>  other ideas for addressing these issues, and has discussed other
>  alternatives.  The RC will address these proposals in a separate
>  position paper.  The RC is ope n to VGRS' comments on these other
>  proposals, as well as any modified VGRS proposal that modifies the
>  WLS per the comments herein.
> 
>  The RC  is  clearly  very  interested  in  this  issue and   welcomes
>  questions or further dialogue.
> 
> 
>