Proposed Comments of NCUC on gTLD introduction

Before answering the specific questions posed by this call for comment, we note that the NCUC (and its predecessor) have adopted positions on new gTLD policies many times before. In its 18 February 2003 statement to the ICANN GNSO Council new gTLDs committee we wrote:

	The NCUC supports a demand-driven approach to TLD additions. ICANN should allow new names to be proposed by interested communities, entrepreneurial registry operators, or a combination of both. We believe that ICANN should define a process that permits addition of a maximum of 30 new TLDs each year. Five of these 30 should be reserved for noncommercial user groups. ICANN's assessment of these applications should be based on adherence to a minimal set of ICANN-defined technical specifications and conformity to established ICANN policies, such as UDRP. Approving a TLD should be - and could be - as simple as accrediting a registrar. Whether the business models proposed were "sponsored" or "unsponsored," "restricted" or not, would be up to the applicants. Contention among applicants for the same name would be settled by auction, with the proceeds going to ICANN. 

Likewise, in a motion passed at the Montevideo ICANN meeting September 7, 2001, the NCDNHC by a vote of 18 in favor, 1 against, and 2 abstentions resolved: 

	ICANN should approve all new Top-Level Domain applications that can meet fair and reasonable technical criteria
		1.	Should new generic top level domain names be introduced? 
Yes. The domain name market, like the Internet itself, cannot be frozen or static. A refusal to add any new gTLDs is not an option. The operation of gTLD registries is currently confined to a tiny handful of operators in the countries where the internet developed first (mostly the U.S.). About 80% of the gTLD market is concentrated in the hands of one operator. The introduction of "internationalized" or multilingual DNS and the growth of the Internet in developing countries with different scripts, cultures, and naming ideas will inevitably create legitimate demand for new gTLDs. ICANN must not shut off the opportunity for new businesses and new constituency groups to propose and operate new gTLDs. To do so would be to permanently block two-thirds of the world from the expertise and wealth that can be gained from participation in this industry, and subject most of the world to the market power of ccTLDs or the current dominant operator. As long as there is growth in the Internet, there will be interest in new gTLD names. As a technical coordinator, ICANN should accommodate demands for new gTLDs as long as there are no adverse technical consequences. We know for a fact that periodic addition of a limited number of new TLDs has no adverse technical consequences, both from experience and from expert studies such as the U.S. National Research Council study "Signposts in Cyberspace." Any attempt to shut the door on the rest of the world at this time is not viable from a political or economic standpoint. ICANN must abandon the fantasy that it can freeze the TLD name space and accept the need for a well-defined, efficient and fair TLD addition process. 
		2.	Selection Criteria for New Top Level Domains 
		a.	Taking into account the existing selection criteria from previous top level domain application processes and relevant criteria in registry services re-allocations, develop modified or new criteria which specifically address ICANN's goals of expanding the use and usability of the Internet. In particular, examine ways in which the allocation of new top level domains can meet demands for broader use of the Internet in developing countries. 
We reject the premise of this statement. ICANN has no mandate in its mission or core values to "expand the use and usability of the Internet." ICANN does, however, have the promotion of competition as one of its core values (see Section 2, Core Values No. 5 and 6 in the ICANN Bylaws). Fundamentally, ICANN's job is to coordinate the unique technical parameters of Internet identifiers in a way that fosters the openness, diversity and competitiveness of the domain name registration market. The best way to do this is to make ICANN's selection criteria as simple, predictable and content-neutral as possible. This makes it easier for innovators to propose and implement new ideas. NGOs, entrepreneurs and other applicants from developing countries (and elsewhere) should be allowed to come up with their own ideas for new TLD names and business models. ICANN should only provide a predictable, fair and efficient process by which those ideas can be accepted or rejected, coordinated and implemented. ICANN's only role in the acceptance process is to establish minimal technical and operational criteria to ensure that registry operations do not harm the global compatibility of the DNS. 
		b.	Examine whether preferential selection criteria (e.g. sponsored) could be developed which would encourage new and innovative ways of addressing the needs of Internet users. 
While NCUC has always supported the concept of sponsored domains, we find it unnecessary and overly restrictive for the sponsored-unsponsored concept to be built into ICANN's registry contracts and rigidified into two separate types of contract. We also do not support any attempt to declare that one model is better or more important than the other. That is for individual users to decide for themselves, by selecting when and where to register. ICANN's role is not to tilt the Internet community's preferences in one way or the other. It is to coordinate the introduction of any new gTLDs to preserve global DNS compatibility. 
		c.	Examine whether additional criteria need to be developed which address ICANN's goals of ensuring the security and stability of the Internet. 
In general, there should be fewer criteria, not more; and the criteria that remain should be more carefully targeted on issues that are part of ICANN's core mission and competence; i.e., global DNS compatibility. ICANN should develop a simple and objective "registry accreditation" process, similar to the registrar accreditation process. 
		3.	Allocation Methods for New Top Level Domains 
ICANN has learned from its past experience that the comparative evaluation or "beauty contest" model is painfully slow, politicized, manipulable and unpredictable, no matter how carefully it is administered. The results have been disastrous. On the face of it, the idea that a few committees of 3 or 4 "experts" (mostly composed of a tiny core of ICANN-affiliated people) can decide for a vast, diverse global market which names are desirable and legitimate is ridiculous beyond belief. Adding to the inherent problems with the beauty contest model, ICANN's political supervisors in the U.S. and GAC have clearly demonstrated to the world that a discretionary selection process can be and will be manipulated, as pressure will be placed on the ICANN Board and staff by political interests and vested economic interests. The only escape route from this disaster is a completely neutral and objective process, such as lotteries and auctions. 
Objective, non-discriminatory methods such as auctions and lotteries are also more pro-competitive. They vastly reduce costs for new entrants by making it clear to applicants what they have to do to get a TLD, what are the anticipated expenses and what is the time line. Under ICANN's current method, applicants for new TLDs are always subject to insider lobbying by incumbents and must bargain individually with staff. Looking forward, we are becoming increasingly concerned about the influence of ccTLD managers, many of whom have openly stated to us their desire to stop any new gTLDs because they view them as threats to their own revenue stream and market share. CcTLD monopolies are particularly dangerous to ICANN's core value of competition because many of them are closely connected to their governments, who can use national regulation and international intergovernmental institutions (including GAC) to achieve protectionist goals. While we highly value ccTLDs as a source of localism and diversity in policy and service, and as a source of national identity to Internet users, we are very concerned about an ICANN TLD selection process that gives them - or any incumbent - the opportunity to block users from exercising free choice in the domain name market. This is not a criticism of the ccTLD managers themselves, who are only pursuing their self-interest. It is a criticism of an ICANN allocation method that permits established players in a market to influence who else gets to enter. 
		4.	Policy to Guide Contractual Conditions for New Top Level Domains 
In general, we favor a simpler, template registry contract that is uniformly applicable to all registries. We oppose individual negotiation between ICANN and prospective contractees. We believe that the GNSO should set general policy guiding the contracts  - e.g., whether there should be price caps or not, or a renewal expectancy or not - and that the ICANN staff should translate those policies into generally applicable contractual terms.