[wg-c] The legal status of registries

[Milton Mueller <mueller@syr.edu>]

White Paper wrote:

>      Response: Both sides of this argument have considerable merit. It is possible that additional discussion and information will shed light on this issue, and therefore, as discussed below, **the U.S. Government has concluded that the issue should be left for further consideration and final action by the new corporation**.

It is probably more productive to debate what ICANN *should* do, not what it *could* do. We have had additional discussion and information and we have shed additional light on the issue. It is pretty clear that the case for restricting all registries to non-profit status has been effectively demolished. Proponents of this position base their case entirely on the possibility of "lock-in," but cannot refute the following facts:

a) non-profits can exploit lock-in as much as for-profits. (note in this regard that the only independent study on this question performed by real economists--the FTC--concluded that there was no significant difference between the two.)

b) consumers who prefer a non-profit or who believe that they can only trust non-profits will be adequately protected simply by having the option to register with one. There is no need to exclude all for-profits.

c) the regulation of the price of the world's largest and most popular gTLD registry provides yet another safety outlet. Any registry will have to be competitive with NSI's, and NSI's price is fixed at a reasonable level.

d) for profit (and non-profit) registries that abuse their customers can and will be regulated by national authorities. All registries exist in a defined jurisdiction.

e) enforcing a non-profit restriction, as KJC's post revealed, will require detailed regulation and monitoring by ICANN of how "profits" are returned to various entities; in that regard the situation is not significantly different from the regulation and monitoring requirements that for-profits would impose.

I think we can lay this issue to rest.

Finally, for those who do believe in reading the entrails of the White Paper, the following statement provides about as clear a statement as one can in favor of market competition:

> The U.S. Government is of the view, however, that competitive systems generally result in greater innovation, consumer choice, and satisfaction in the long run. Moreover, the pressure of competition is likely to be the most effective means of discouraging registries from acting monopolistically.

Note that it valorizes "competition," not "non-profit status," as the most effective means of discouraging registries from acting monopolistically.

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m i l t o n   m u e l l e r // m u e l l e r @ s y r . e d u
syracuse university          http://istweb.syr.edu/~mueller/