The draft New gTLD Applicant Guidebook (version 2) has been released along with an analysis of the comments to the prior version. The documents are voluminous.
I glanced at the revised draft Base Agreement, and it\'s clearly unacceptable as there continue to be no price caps in place to protect registrants (see section 2.9).
This is a backdoor way of allowing existing registry operators (e.g. com/net/org/biz/info) to get unlimited pricing power for existing domain names through .tv-style tiered pricing. Obviously ICANN is only listening to registry operators and prospective registry operators, given they\'ve even lowered fees for registry operators (see Section 6.1) Note that price controls were a major source of comments by the public (see the bottom of page 121 to 123 of the comments analysis).
In particular, Neustar (operator of .biz) is on public record (page 123) stating they want elimination of price caps for .biz under the \"equitable treatment\" clause of existing registry agreements if other registries get it:
Any material changes for the newer, no-price capped TLDs regarding vertical separation and equal access in general must be applied to NeuStar – this is required under the .biz Registry Agreement and ICANN\'s Bylaws. Price caps are appropriate for larger TLDs that have a much higher percentage of the market and are not appropriate for gTLDs that do not have any real market power.
If you are an existing registrant, even the smaller TLDs have market power over you, as you are \"locked in\" to that domain name and face very high switching costs (e.g. if you had operated abc.biz for 5 years, and Neustar suddenly decides to raise the renewal price to $1 million/year, that will definitely affect you, and is not something where \"competitive forces\" are at play). If VeriSign asked for $1 billion/year as a renewal fee for Google.com, Yahoo.com, or Microsoft.com, there is nothing in the contracts to protect domain name registrants. Similarly if PIR wanted to raise the renewal price of Redcross.org to $10 million/yr, Sex.org to $100 million/yr, or other \"elite\" domains to any price level they desire, there is simply no language to protect registrants.
The NTIA and Department of Justice recognized these issues, yet ICANN continues to put domain registrants at risk. The DOJ made two specific recommendations, namely (1) ICANN Should Give Greater Consideration to Consumer Interests before Creating New gTLDs and Renewing Registry Agreements, and (2) ICANN Should Revise The RFP Process and the Proposed Registry Agreement to Protect Consumers from the Exercise of Market Power. In fact, ICANN has done the exact opposite, ignoring consumer interests and tilting these agreements even more in favour of existing and prospective registry operators than the prior drafts.
This demonstrates conclusively that ICANN is simply out of touch with the public interest and knowingly favours the interests of registry operators, to the detriment of consumers. The need for more active supervision by the NTIA/DOJ is evident, and in particular they should order the cessation of the New gTLD program in its entirety. The public could not have been more clear in their prior comments, yet ICANN has knowingly chosen to ignore them. Given ICANN\'s reckless behaviour in speculating with their emergency reserve fund and losing $4.6 million in the process, it is time for the NTIA/DOJ to take decisive measures now to prevent further damage through ICANN\'s utter disregard for the public interest.
Written by George Kirikos, President, Leap of Faith Financial Services Inc.. Visit the blog maintained by George Kirikos here.
