Griping Begins Over Domain Deal

A rocky month could lie ahead for the historic agreement over domain names announced Tuesday between Network Solutions, the Internet Corp. for Assigned Names and Numbers and the U.S. Commerce Department. Already, several interested observers have announced their unhappiness with aspects of the tentative deal.

While the participants claim the agreement represents a compromise by all sides, Richard Forman, chief executive officer, said Wednesday that Commerce should have been tougher in its negotiations with NSI.

“Not re-competing NSI’s (NSOL) contract is mind-boggling. The government’s not allowed to buy pencils ithout getting three quotes,” said Forman, whose company was one of the first accredited by ICANN to compete with Network Solutions.

Under the tentative agreement, NSI is allowed to remain the exclusive registry of top-level domains .com. .net, and .org for another 4 years. In exchange, the company agreed to several concessions aimed at leveling the playing field with its competitors.

According to Becky Burr, acting associate administrator of Commerce’s National Telecommunications and Information Administration, the U.S. is satisfied with the deal, particularly because it was hammered out over a negotiating table rather than in a court room.

“There was a real possibility that we would have gone to court. A court battle prolongs the status quo and increases uncertainty. I think this package takes care of all the public policy concerns we had,” Burr said.

But Forman said that if NSI threatened to back out of negotiations or sue the government, the US should have repossessed the root servers that hold the database of domain registrations.

“If they have to go in with Marines, they should. I have never heard of a company holding the U.S. hostage. Did AT&T threaten to shut down the phone system when they were de-regulating that market?”

According to Forman, has no interest in entering the domain registry business, Instead, he sees re-competing the registry contract as a way to ensure no conflict of interest between NSI’s registrar and registry businesses. And while the agreement contains an incentive aimed at goading NSI to make such a split within 18 months, “that’s an eternity in Internet time” said Forman.

Bill Whyman, an Internet analyst with the Legg Mason Precursor Group, however, praised the deal’s carrot-and-stick strategy. “It’s a good structural solution. Perhaps not as fast as would like, but it’s also not as much of a regulatory intrusion.”

The agreement signed Tuesday is nominally a “tentative” agreement and under ICANN’s by laws must be open to public comment for 30 days. But Jonathan Weinberg, a professor of law at Wayne State University, said the deal is essentially carved in stone.

“Once this deal was reached, no side has any incentive to agree to even a small tweak that they feel puts them in a less advantageous position. If ICANN should get a lot of comments saying we think this gives NSI too much control over the dot-com database, and ICANN decided to formulate a recommendation to change that, that’s going to be a non-starter. NSI’s not going to go along, and then we don’t have a deal.”

While many critics of ICANN, Weinberg among them, have objected to the group’s top-down decision making process, Weinberg says he’s nonetheless troubled by language in the new registrar and registry agreements that seeks to rein in ICANN by requiring a consensus vote of two thirds of the appropriate supporting organization.

“There a lot of important policy questions on which genuine consensus may not be possible. We’ve got people with very different views and financial interests. If ICANN is bound to preserve the status quo when it runs into that sort of disagreement, it may not end up making the best choices.”

ICANN will take up a discussion of the tentative agreement at its annual meeting in Los Angeles Nov. 2nd. Mike Roberts, ICANN chief executive officer, said he’s prepared for additional criticism once interested parties have had a chance to review the details of the deal.

“The Internet is a contentious place, so I don’t expect something like this is going to satisfy everybody. Not by any means.”

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