Re: [registrars] Comments on Verisign Wait List proposal

["Ross Wm. Rader" <ross@tucows.com>]

Bruce - this is a reasonable analysis, but, there are a few inconsistencies
that need to be discussed.

1. 22 A) and B) are instruments designed to set the ceiling prices for
Registry Services and provide the Registry with a mechanism to increase the
price for Registry Services when faced with increased cost "arising from (i)
new or revised ICANN specifications or policies adopted after the Effective
Date, or (ii) legislation specifically applicable to the provision of
Registry Services adopted after the Effective Date"

2. Appendix G very explicitly supports this and further states that for
existing Registry Services "Registry Operator may charge a
lower-than-specified rate for services, including not charging for a
specified service. Except as set forth herein or otherwise agreed, Registry
Operator shall not be entitled to charge for any Registry Service not
specified in this Appendix G."

3. 22 A) explicitly states that the terms and pricing of initial and renewal
registrations shall be set in accordance with Appendix F (the Registry
Registrar Agreement) - and therefore consistent with Appendix G.

To bring this back to your analysis,

a) WLS could be classed as a Registry Service according to the definition in
the contracts. It is also however a modification to the existing agreements
covering the terms, conditions and pricing surrounding the provision of
initial and renewal registrations.

b) The WLS proposition is not being introduced by VGRS pursuant to
"reasonably demonstrated increases in the net costs of providing Registry
Services arising from (i) new or revised ICANN specifications or policies
adopted after the Effective Date, or (ii) legislation specifically
applicable to the provision of Registry Services".

c) Given a) & b) above, the introduction of WLS would be a violation of the
terms and conditions of Appendix F & G that explicitly state that the
Registry Operator may not price higher than the explicit statements made in
Appendix G and also may not charge for any Registry Service not specified in
Appendix G.

In my opinion (with the typical IANAL/IANYL disclaimer) I can't see what
basis in contract VGRS has for proceeding with the deployment of this
service without first undertaking a negotiation of the terms with its
clients. In other words, we each pay $6 for our names, that really shouldn't
change until a reasonable discussion has taken place to determine what we
are getting.

There may be other areas in the contracts that permit VGRS to proceed with
the deployment of the WLS, but this isn't it.

-rwr

----- Original Message -----
From: "Bruce Tonkin" <Bruce.Tonkin@melbourneit.com.au>
To: <registrars@dnso.org>
Sent: Friday, February 22, 2002 2:10 AM
Subject: [registrars] Comments on Verisign Wait List proposal


> Hello All,
>
> This will be a long posting, but I think it is important to have framework
> to move forward on the WLS issue.
>
> Before attending the registrars meeting in Dulles, Virginia, USA last
> weekend, I visited ICANN offices in Los Angeles and also visited Verisign
> registry offices near Dulles.
> One of the main areas of interest for me was the process for approving and
> moving forward with new product and service offerings that come under the
> definition of Registry Services
> in the ICANN contracts (see
>
http://www.icann.org/tlds/agreements/verisign/registry-agmt-com-16apr01.htm)
> .  As a general principle I believe that registry operators should be able
> to innovate and produce new products and services, and that these should
not
> be unduly held up through a long and bureaucratic process.  On the other
> hand new REGISTRY SERVICES should be consistent with providing value to
> consumers, and not causing damage for consumers (e.g resulting in lower
> stability or integrity of the DNS, which could result from widespread
> accidental deletions and loss of names)
>
> A Registry Service is defined as:
> ********************
> "Registry Services" means services provided as an integral part of the
> Registry TLD, including all subdomains. These services include: receipt of
> data concerning registrations of domain names and nameservers from
> registrars; provision to registrars of status information relating to the
> Registry TLD zone servers, dissemination of TLD zone files, operation of
the
> Registry zone servers, dissemination of contact and other information
> concerning domain name and nameserver registrations in the Registry TLD,
and
> such other services required by ICANN through the establishment of
Consensus
> Policies as set forth in Definition 1 of this Agreement. Registry Services
> shall not include the provision of name service for a domain used by a
> single entity under a Registered Name registered through an
ICANN-accredited
> registrar."
> *******************
>
> I understand from discussions with ICANN and Verisign, that the WLS
proposal
> falls into the category of a Registry Service.
>
> In the ICANN contract with Verisign there is provision for approving price
> of registry services as follows:
>
> ********************
> 22 Price for Registry Services.
>
> A. The price(s) to ICANN-accredited registrars for entering initial and
> renewal domain name registrations into the Registry Database and for
> transferring a domain name registration from one ICANN-accredited
registrar
> to another will be as set forth in Section 5 of the Registry-Registrar
> Agreement (attached as Appendix F). These prices shall be increased
through
> an amendment to this Agreement as approved by ICANN and Registry Operator,
> SUCH APPROVAL NOT TO BE UNREASONABLY WITHHELD, to reflect reasonably
> demonstrated increases in the net costs of providing Registry Services
> arising from (i) new or revised ICANN specifications or policies adopted
> after the Effective Date, or (ii) legislation specifically applicable to
the
> provision of Registry Services adopted after the Effective Date, to ensure
> that Registry Operator RECOVERS SUCH COSTS AND A REASONABLE PROFIT
THEREON;
> provided that such increases exceed any reductions in costs arising from
(i)
> or (ii) above.
>
> B. Registry Operator may, at its option and with thirty days written
notice
> to ICANN and to all ICANN-accredited registrars, revise the prices charged
> to registrars under the Registry-Registrar Agreement, provided that (i)
the
> same price shall be charged for services charged to all ICANN-accredited
> registrars (provided that volume adjustments may be made if the same
> opportunities to qualify for those adjustments is available to all
> ICANN-accredited registrars) and (ii) the prices shall not exceed those
set
> forth in Appendix G.
> ***************************
>
> I have placed in caps two important phrases above, ie:
> - such approval not to be unreasonably withheld
> - recovers such costs and a reasonable profit thereon
>
> My view is that Verisign should submit a formal proposal to ICANN staff
that
> describes their new product and service, and proposes a price for
registrars
> that is based on costs and a reasonable profit margin.  It would be
sensible
> if ICANN staff spoke to some members of the industry to get a feel for
> reasonable costs, or compared the costs of a new service with a comparable
> service.  For example the cost to set up WLS could be compared to the cost
> to establish ".biz" or ".info" registries.  However ICANN may not
> unreasonably withhold approval.
>
> I do not believe it is the role of the registrars constituency to
> collectively determine a price for the service - this would appear to be
> against at least anti-trust legislation in the USA.  I will offer a
personal
> comment in that the price is higher than I would have expected for the
> volumes of WLS that have been quoted in some responses from Verisign.  Now
> there are obviously some intellectual property costs that I am not privy
to,
> and there is also some risk that the volumes may be far lower.  One
approach
> Verisign may consider is to follow the approaches of ".biz" and ".info"
that
> provided a sliding scale for their costs for registering a domain name
based
> on volumes.
>
> I do believe that ICANN does have a role to ensure that a new REGISTRY
> SERVICE offering is consistent with the overall stability and integrity of
> the DNS, and that there are sufficient safeguards that the new product is
> not anti-competitive or otherwise harmful to the consumer.
>
> The Registrars Constituency has a role to advise the ICANN Board either
> directly or through the namescouncil of any concerns that it may have with
> regard to the point above.  I am now of the view that there are no
> substantial issues that will affect stability or seriously affect the
> consumer (provided there is some grace period around the deletes as have
> been proposed by ICANN staff, or offered by Verisign if the ICANN staff
> proposal is rejected).
>
> I have previously raised concerns about the loading problems with the
batch
> pool for deletes.  I have spoken extensively to Verisign technical staff
on
> this issue, and accept their statement that the loading problem is solved
> from their point of view, and I believe this solution will also avoid
> problems with the inevitable loading problems with WLS.  The staff
confirmed
> to me that registrars will always find innovative approaches to
registering
> either domain names or WLS spots that will result in loading the registry!
> It is unfortunate that we had to wait until the meeting in Dulles for
> Verisign to supply technical staff to talk about this point.  To me WLS is
> just a parallel registry, which will have similar competitive and
technical
> loading dynamics to the existing ".com" registry.
>
> The registrars constituency also has a role as customers and users of
> Verisign services to collectively work together with Verisign to improve
the
> QUALITY of the services provided.
> I have previously stated areas where I think the quality of the new
service
> offering could be improved.  I will re-iterate some of these ideas here.
It
> would be good if the drafting team could incorporate some of these ideas
in
> their document if they are generally agreed.
>
> (1) Grace period:
> I believe that this is absolutely critical.  From experience domain names
> are often not renewed inadvertently (ie the registrant was out of contact
> and did not receive a renewal notice).  With the use of automated systems
to
> immediately register deleted names, registrars are increasingly dealing
with
> the customer service problem of trying to get a domain name back that has
> been deleted by mistake.
> I strongly recommend that a hold grace period be used before the deleted
> name is allocated to a the subscriber, during which the name is removed
from
> the zone file.  I recommend that the period be extended to 30 days.
>
> (2) Transparency
> To be able to evaluate the success of the "trial period", and also ensure
> that the WLS service is not being used in an anti-competitive way, I would
> like to be able to have either or both of the following:
> (a) a public WHOIS style service at the registry which will display for a
> domain name, whether a WLS exists on the name, the creation date of the
WLS,
> and the name of the registrar that is managing this WLS.
> (b) via the EPP protocol, I would like the <info> command to return the
> information as above
> I would like to see information broken down by registrar on reports such
as
> those provided by Snapnames.  Point (a) above ensures that the system is
> open to consumers, and point (b) allows registrars to innovate with
> customised services.
>
> SUMMARY
> I do not believe that it is the role of the registrars constituency to
> collectively approve or dis-approve of the service.
> It is the role of registrars constituency to collect feedback and express
> any concerns with the operation of the service, and request quality
> improvements that address those concerns.
>
> My position is that I am not against the proposal proceeding through to
> approval by ICANN staff provided that a suitable grace period is provided.
> I leave it up to ICANN staff to satisfy themselves that the price of the
> registry service is reasonable.  I see no regulatory reasons not to
proceed
> at this stage.
>
> In terms of Melbourne IT's approval of the service, it will be a business
> decision based on the demand from our customers.  We do believe that there
> is a demand for a simple "back-order" service, but we don't know how much
> demand there is.  So from that point of view we will let the market
decide.
>
> We do support the right of a registry operator to be able to introduce a
new
> service, and we encourage registry operators to innovate.
>
> COMMENTS ON VOTING
>
> At the registrars constituency meeting in Dulles, I don't think the right
> question was asked to make a formal vote meaningful on the WLS topic.
> Moving forward, I would like to see the output from the drafting team, a
> period for comment on that output, and then an ability to vote on
accepting
> the document or rejecting the document.  I think it would be fair in
> forwarding the document to Verisign GRS and other groups in ICANN, to
record
> the names of those registrars that vote for, against or abstain.  I am
quite
> comfortable with a majority vote being used to indicate that the
registrars
> constituency "approved the document", with the vote being recorded.  I am
> also comfortable with individual registrars expressing their own comments
> through separate submissions to Verisign, ICANN staff, or other groups
> within ICANN.  I don't think we need to waste time with endless minority
> views being attached to the document, unless there is more than one party
> that subscribes to a particular minority view.
>
> As others have pointed out, unless we improve our procedures, the impact
> this group has in the wider ICANN process will remain limited.
>
> Regards,
> Bruce Tonkin