Re: [wg-c] breaking up (names) is hard to do

[Kent Crispin <kent@songbird.com>]

On Fri, Aug 27, 1999 at 10:05:27AM -0400, Kevin J. Connolly wrote:
> I concur that the only model that has a prayer of gaining rough
> consensus is one in which non-profit registries and for-profit
> registries compete for registrars and, directly or indirectly, for
> SLD name registrations.

The distinction between "for-profit registries" and "non-profit
registries" is not precise enough for our purpose.  You mention that
CORE could be considered a "for-profit", because it is controlled by
a group of registrars, most of which (but not all) are for-profit. 
There is also the distinction between the "registry" and the
"registry operator" to consider, and the fact that the total
operation could involve several contracts with for-profit entities. 
We also have to distinguish the business model of the registry with
the nature of the entity making the proposal to run the registry. 

For example, IBM could propose to run a registry.  IBM is a
for-profit entity, but the proposal for the registry could still
include provisions that cause the registry to be run on a
controlled-cost basis (non-profit/cost-recovery/fixed-price/etc).

I think many of us tend to use the term "non-profit" registry as a
shorthand that covers this possibility.  But if you think about it,
under this broad definition of "non-profit", NSI is currently a
"non-profit registry" -- it's profits are limited (theoretically)
through contract to the USG.  [Of course, the issue of the *efficacy*
of that control is quite debatable.] Perhaps the term "limited-profit
registry" would be better, but I suspect that would simply confuse
matters more. 

So, what is meant by the term "for-profit"? To me, and to some
others, I believe the term "for-profit" refers to a situation where
the registry has freedom to raise SLD prices as it wishes.  That is,
we don't mind downard pressure on SLD prices, but not upward
pressure.  This follows from a belief that the competition in
registry services should be driving the price of SLD registrations
towards the cost of maintaining them -- any significant mismatch is
evidence of monopoly effects in registry services.

> The big problems are twofold:
> 
> First, in a steady-state system, in which TLD's are delegated and
> subject to competitive redelegation, how will we level the playing 
> field between non-profit and for-profit registries?
> 
> Second, during the rollout, how will we guard against the creation
> of more NSIs (monopolists) if the creation of new TLDs/Registries 
> stops short of the addition of <largenum>?
> 
> The third problem (how to prevent a registry from renewal gouging)
> is actually a simple one: insert a contractual mandate limiting the
> increase of registry charges for SLD name renewals, based on some
> objective metric.

This actually, in my terminology, requires that all registries be 
"limited-profit".

> And actually enforce the provision, expressly
> providing that other prospective registry operators and SLD name
> registrants have standing to challenge any failure to enforce
> forfeiture of the TLD for renewal gouging. 

"Standing" is not the same as "enforcement".  For enforcement to work
you actually have to have clauses in the contract that require timely
escrow of registry data, and the technical ability of ICANN to
transfer that data to a new registry without undue difficulty.  It 
also requires that the registry operator have no intellectual 
property claims that can encumber that transfer.

-- 
Kent Crispin                               "Do good, and you'll be
kent@songbird.com                           lonesome." -- Mark Twain