Congress Questions ICANN/VeriSign Deal

Questions are swirling around the Internet Corporation for Assigned Names and Numbers (ICANN) yet again Friday, and this time they involve the Department of Commerce and VeriSign Inc., the domain name industry’s biggest registrar and holder of the grail of the industry’s wholesale arm, the .com registry.

Since its inception, ICANN, intended as a governing body for the Internet, has been steeped in controversy. After ICANN selected a series of new top-level domains last November, the House Subcommittee on Telecommunications and the Internet got involved, raising questions about the selection process and whether due process had been afforded the applicants.

More questions were raised on March 1, when ICANN and VeriSign announced they had ironed out a deal in which VeriSign would cede control over the .org and .net registries in exchange for the right to keep the .com registry until 2007. The deal also allowed VeriSign to hang onto both its registrar and registry businesses, an arrangement that flew in the face of an October 1999 deal VeriSign had made with ICANN and the Department of Commerce which stipulated that VeriSign must divest ownership of either its registrar or registry businesses.

Now a bipartisan group, composed of members of the Committee on Energy and Commerce and the Subcommittee on Telecommunications and the Internet have asked the Department of Commerce to explain its role in the renegotiation of the 1999 contract. The letter — signed by Rep. W.J. Bill Tauzin, chairman of the Committee on Energy and Commerce, Rep. John D. Dingell of the Committee on Energy and Commerce, Rep. Fred Upton, chairman of the Subcommittee on Telecommunications and the Internet, and Rep. Edward J. Markey of the Subcommittee on Telecommunications and the Internet — was addressed to Commerce Secretary Donald Evans.

“Without taking a position on the propriety of the revised agreement, we want to ensure that any actions by ICANN support and encourage strong, vibrant competition,” the representatives wrote. “Accordingly, we respectfully request that the department fully analyze the competitive issues that arise as a result of this agreement. Further, as Mr. [Vint] Cerf, chairman of ICANN, said during our February hearing, ICANN is a consensus development body which requires that major decisions affecting the future of the Internet be done in an open and transparent manner. Therefore, we urge you to exercise your oversight authority to ensure that ICANN’s final decision in this matter is made and implemented in a transparent fashion.”

The questions on competition arise from the fact that VeriSign sells between 40 and 50 percent of the world’s 28.2 million Web addresses using the .com, .net or .org TLDs, and also owns the registries where those addresses are recorded. The Department of Commerce originally stipulated that VeriSign must spin off either the registrar or registry business because rival registrars felt that VeriSign would hold a significant advantage over competitors if it controlled both sides of the board.

The ICANN board is scheduled to vote on the revisions to its agreement with VeriSign at its regularly scheduled meeting on April 2.

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