Re: [wg-c] Working Group C agenda

["Kevin J. Connolly" <CONNOLLK@rspab.com>]

Dear Readers:

There are several problems with the Shepard/Kleiman principles.

First, at least one of the proponents (Kathy Kleiman)
has stated (for instance, at the March 1 Small Business Administration
round table on the future of the DNS and small businesses) that
the principles are intended to be entirely optional, i.e., that no penalty
would attach to a registry which declined to embrace any one or more
of these principles.  If that is so.....if the adoption or rejection or modification
of the principles is a matter for each registry to consider as part of its business
plan.....then this WG has no business dealing with them.

Second, while the principles are nice-sounding, they are, in fact, fraught
with a mixture of operational difficulty, practical lack of meaning, and

D A N G E R!!!  I recognize that I am probably in ful-dress Cassandra mode
at this point, and while I rend my garment and cover myself in the ashes of
Semele, yet I cannot still my fingers.

The concept that a TLD should mean what it stands for is a good example 
of these problems.

My distinguished cousin, o-taka-no-sama Robert Connelly, is no doubt
aware that one of the more popular SLD delegations requested under .FIRM
is "keep-it" and congeners thereof.  Not exactly congruent with that the
IAHC had in mind when it proposed that TLD.

In the absence of a narrow and stringently-enforced charter, a gtld means 
whatever the users think it does.  A narrow and stringently-enforced charter
is not good business.  

A narrow charter reduces the number of SLD delegations that will be 
requested, thereby increasing the average cost per domain; and since 
average cost is about as good an approximation to marginal cost as 
we will ever find in the real world, an increased average cost means 
that the competitive market price to the end user is likewise increased.

Strict enforcement of charters is likewise very expensive.  Though I have yet 
to see a rigorous examination of the costs of strict enforcement, the cost of
bringing a UDRP (an artifact of loose a priori enforcement) is not small.  If we
are to adopt a rule of stringent enforcement before registration, I daresay that
the cost should not be less.  This indicates that the cost of securing a SLD 
delegation would be on the order of $1,000.00, thereby creating some
fairly high barriers to entry.  We should be mindful that the internet establishment
wants to do precisely this:  raise the barrier to entry so high that no-one would
ever think of obtaining their own SLD to use as a permanent e-mail address and
family photo album; raise the barrier so high that mom-and-pop operations will
not presume to try to create the same kind of internet image as the big guys.

Moreover, this little review does not even attempt to factor in the need to 
develop a litigation war chest, and it goes without saying that new TLD registries
will need to prepare their legal strategies carefully.

There will be at least two serious challenges to strict prequalification of SLD
delegations:  one from the civil libertarian elements of US society, which reacts
frontally to anything which can be characterized as restraint of free speech.  The
second challenge will be economically driven, and come from the name-hoard/
cybergrab industry.  I don't care to try to guess at the cost of defending the system,
but it won't be cheap.  A conservative estimate is on the order of $10E6.

NSI has consistently avoided being held liable as a secondary infringer of trademarks
precisely because it exercises no prior scrutiny before delegating a second level
domain.  Apart from the fact that the Shepard/Kleiman principles sound nice, there
is no good reason to adopt them.  There is, however, a darned tootin' good reason
to avoid them.

Timeo danaos et dona ferentes.  I fear the Greeks, even when they bear gifts.
The principles are a Trojan Horse.  Consider the source thereof:  WG-B.  I 
shudder in horror.  Once we adopt the idea that registrars or registries or registrants hold a
domain out as meaning something, and that that holding-out is a part of the process
of obtaining a delegation, we have let Odysseus into the walls of Illion, and we will
have let a legion of hungry lawsharks into the DNS.  The competitive disadvantage
that the new gtlds will face vis a vis com/net/org (which make no such pretense and
therefore will not be sued into oblivion for failure to enforce the principles) will swamp
the new gtlds.

By the way, I do not condemn the authors of the principles as being as wily and crafty
as Odysseus.  They have engaged in an exercise which has great interest.  I simply
believe that the adoption of the principles, or of any similar prior restraint on the
operations of new gtld registries, is suicidal.

Kevin J. Connolly
The opinions expressed are those of the author, not of Robinson Silverman Pearce 
Aronsohn & Berman LLP
This note is not legal advice.  If it were, it would come with an invoice.
As usual, please disregard the trailer which follows.
**********************************************************************
The information contained in this electronic message is confidential
and is or may be protected by the attorney-client privilege, the work
product doctrine, joint defense privileges, trade secret protections,
and/or other applicable protections from disclosure.  If the reader of
this message is not the intended recipient, you are hereby notified
that any use, dissemination, distribution or reproduction of this com-
munication is strictly prohibited.  If you have received this communi-
cation in error, please immediately notify us by calling our Help Desk
at 212-541-2000 ext.3314, or by e-mail to helpdesk@rspab.com
**********************************************************************