[registrars] RE: WLS comments from Registration Technologies, Inc.

[Jim Archer <jarcher@registrationtek.com>]

Hi Chuck...

Thanks for your reply.  Let me respond to your comments.

--On Wednesday, January 16, 2002 8:10 AM -0500 "Gomes, Chuck" 
<cgomes@verisign.com> wrote:

> Is it inappropriate for a company to enter a marketplace they are not
> presently in?  If so, I assume we should not allow anymore registrars to
> be accredited.

As we understand it, it is inappropriate for a monopoly to enter an 
existing market segment in which they currently do not participate if their 
monopoly advantage can be leveraged to gain advantage.  Accrediting new 
registrars who are not all monopolies (and could not be by definition) is 
an unrelated issue and therefore your argument is specious.

> Is VeriSign allowed to evaluate whether or not it wants to offer a
> particular service?  If so, isn't it appropriate for VGRS to obtain
> feedback from its direct customers as part of that evaluation? What you
> seem to see as VGRS controlling the feedback process is nothing more
> than VGRS obtaining feedback from registrars.

Certainly we do not oppose Verisign conducting market research and such. 
However, this current process seems to be targeted at Verisign making a 
determination about whether to launch WLS.  As being conducted, the comment 
period offers the appearance that there is a fair process acting to 
determine if Verisign, a monopoly, will be allowed to enter a new market 
segment.

Now, if Verisign is soliciting comments from its customers with the intent 
of deciding whether or not to *seek permission* to offer WLS, that's 
appropriate.  On the other hand, if Verisign is seeking comments from 
customers to decide if they are going to *actually launch* the service, 
this raises a concern.  Our opinion is that as a natural monopoly, Verisign 
would require permission from a regulatory agency to launch WLS.  If this 
process is to determine whether or not Verisign will be launching WLS, we 
believe it should be conducted by ICANN or some other appropriate agency. 
Is this the case?

> With regard to the comment period being short, discussion of these
> issues have been going on since last September.  But putting that aside,

True, but without a specific, detailed proposal much of this discussion is 
mere speculation.

> it certainly appears like you were able to adequately respond and you
> just received the proposal yesterday.  Moreover, I would venture a guess
> that your comments wouldn't have changed much whether you had 1 day or 3
> months, but that of course is just a guess on my part.

There were other issues we simply lacked time to properly research.  With 
additional time, we could have filed much more extensive comments, which is 
in everyones interest.

> Your arguments are primarily focused on your point of view as a
> registrar who apparently focuses on domain name speculation.  That is

No, in fact.  That is not our intent.  Regardless of whether or not it is 
in our interests for WLS to be launched, our opinion that it is 
anti-competitive remains.  Any organization should file comments based upon 
their opinion of the proposal and its impact on the industry and consumers. 
It would be short sighted and disingenuous for us or any other party to 
support a damaging proposal simply because it would benefit themselves.

> fine, but as a consumer, I would a lot rather have a 100% chance of
> getting a name than a lower probability.  The reality of the matter is
> that the only way that can happen is for this service or even many of
> the other proposed services to be offered through the registry in some
> manner.

But your not getting a certainty, which is what you would want as a 
consumer. How can you have a 100% "chance?"  A "chance" means that the 
outcome is uncertian.  To say something is 100% chance implies some sort of 
guarantee but in reality is meaningless.  As proposed, a wait *is not* a 
guarantee of getting a name.  If the registrant renews the name, or if the 
sponsoring registrar simply declines to delete the name then the subscriber 
is out their fee and gets nothing.  I'm not being sarcastic here.  This 
"100% chance" language is exactly the type of service description and 
marketing language we oppose on ethical grounds.

> I don't have a clue as to what you mean when you say that current
> registrations are priced on a "cost plus" basis.  They are priced on a
> fixed fee basis, $6.  Possibly you are using the term "cost plus" in
> some way different than it is normally used in contracting or one I am
> not familiar with.

The $6 is the result of a "cost plus fee" evaluation, or the result of an 
initial bidding procedure.  When the phone company wants to launch a new 
service or change their rates, they have to go to the regulatory agency and 
seek permission to do so.  Permission is often granted or denied on the 
basis of a change of (or evaluation of) the utilities cost.  In the case of 
a new service, they must justify their proposed price based upon their 
costs being x and y being a reasonable profit, so the charge to consumers 
is x + y.  This is all because as a monopoly, the phone company would 
otherwise set very high prices which consumers would have either pay or go 
without phone service.

> Thanks for your feedback.  That is what we asked for.

Your welcome. We do hope you find it useful.

Jim


*****************************
Jim Archer, CEO
Registration Technologies, Inc.
10 Crestview Drive
Greenville, RI 02828
voice: 401-949-4768
fax: 401-949-5814
jarcher@RegistrationTek.com
http://www.RegistrationTek.com