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ICANN-Verisign .Com Agreement Comes Under Congressional Scrutiny
fight over ICANN's highly controversial
proposed .com agreement with Verisign
moved into the halls of the U.S. Congress June 7
when a hearing on the issue was held by the House
Committee on Small Business. This is an issue that
will affect everyone who owns domain names, so it is
well worth paying attention to.
Berard, spokesman for the Coalition for ICANN
an industry group devoted to derailing ratification of
the agreement by the U.S. Department of
Commerce, said the hearing was another critical step
in preventing the damage the deal would do to small
business and consumers. The
congressional session was labeled "Contracting
the Internet: Does ICANN create a Barrier to Small
(Photo by Kevin McCoy)
said "Ever since the ICANN board cast its vote on the proposed .com agreement the
Internet community has voiced continued opposition on
the matter." Berard
added, "This hearing is yet more evidence that the
.com deal is wrong for the community and is wrong for
small business. By granting VeriSign a perpetual
monopoly to the .com registry, the Internet community
will be faced with unjust price increases and a
continued erosion of the check-and balances."
Other registries that
would like to compete for the .com contract have stated
they would lower costs rather than raise them but the
ICANN-Verisign deal has left potential competitors out
inthe cold. For large portfolio owners, the
additional costs could run into 7 figures. Marc
Ostrofsky, President of Internet
REIT, said if the deal is allowed to go
through it would cost his company $1 million a
year in additional registration fees.
Ostrofsky was among
those who submitted testimony to the Committee June 7.
He said "it will raise significantly the cost of
doing business without sufficient justification, it
ignores and shuts the door to alternatives which could
decrease these costs by a significant amount, and it
opens the door to unfair competition by VeriSign. The
full text of Ostrofsky's statement to the Committee and
a series of questions he asked the Congressmen to
consider can be read here.
Krishan of Netsphere also submitted a letter to the
Committee detailing how he thinks the deal will negatively
impact small business. Krishan said that the small business
community is “asking for a market where small business can
invest and grow in a market without fear that a corporation in a
monopoly position, protected by ICANN, will attempt to hijack
successful business models to the exclusion of competitors.”
proposed agreement provides for VeriSign to have exclusive
access to [traffic] data for its own commercial benefit,"
Krishan said. "Currently, we obtain this data through other
sources, and it is essential to our business; without it, we
would no longer order new domain name registrations. This poses
a threat to our existence without providing any benefit to
marketers or consumers.” Furthermore, Krishan urges the
committee to prohibit ICANN from asking small business to
“play by one set of rules and allow VeriSign to play by an
entirely different, and less restrictive, set of rules.”
You can read his full testimony here.
|One of the
more interesting comments at the hearing came from Network
Solutions CEO Champ Mitchell whose company
was owned by Verisign until 2003. Mitchell said the .com
deal "shocks the conscience." He added that
there was no need to rush to a bad judgment as discussions
on the future of the Memorandum of
Understanding, the document that governs the
relationship between ICANN and their overseer, the U.S.
Department of Commerce, is underway and the current .com
contract is not scheduled to end until next fall.
Committee members apparently agreed with the go slow
approach, deciding to accept written public comments on
the proposed agreement for the next two weeks.
of this writing (just hours after the hearing ended),
the procedure for sending comments to the House
Committee had not been outlined, but the CFIT
site will likely post that information soon.
Another good synopsis of what happened in the hearing
June 7 has been posted at Silicon.com.
in the Midwest
We hear the 3rd Annual GeoDomain Expo held at the Hyatt
Regency in Chicago last weekend (June 2 & 3) was a
big success. More than 100 owners of prime city domains like NewYorkCity.com,
Chicago.com and LosAngeles.com were on hand along
with representatives from more than a dozen sponsoring companies.
The event was staged by Associated
Cities, a fast growing network that has drawn the
various city domain owners together to help advance each other's
|I wasn't able
to attend the event personally due to a long-scheduled
family vacation that had me visiting another part of the
Midwest while the GeoDomain Expo was underway. That trip
took me to Delaware, Ohio (a small college town
just north of Columbus) where I grew up. My wife,
daughter and I flew in from Florida to visit my mother who
is still going strong at 87 years of age! You know how
hard it is to explain the domain business to people
outside the industry but my mom seems to grasp it pretty
well - or maybe she was just nodding her head to humor me
The GeoDomain Expo is
another example of the phenomenal growth in this business.
Now, in addition to the mega conferences like
T.R.A.F.F.I.C. and Domain Roundtable, we are
seeing more specialized events devoted to specific sectors
of the industry growing into high value meetings as
daughter with her grandmother
last weekend in Central Ohio
year with Roundtable in April, T.R.A.F.F.I.C. West in May and
GeoDomain Expo in June, a lot of domainers were living out of
their suitcases - but we didn't hear anyone complaining. It's
great to get together, share ideas and help each other keep moving
forward in one of the world's most exciting businesses.
DN Journal's June Cover Story: How Ari Goldberger Beat the Odds
and Found Domain Fame
June Cover Story will be out in a couple of days and for those
who enjoy the kind of personal entrepreneurial stories we love to
do, this is an article you won't want to miss. Today Ari
Goldberger is one of the world's best-known domain attorneys.
He is also a successful businessman who heads a highly regarded
PPC parking company at SmartName.com.
Ari's rise to the top defied all of the odds. His parents were
both survivors of the Holocaust who immigrated from Poland
to Israel to America with little but hope that
the "land of opportunity" would give them and their
children a shot at a new beginning.
began a business career almost as soon as he could walk when he
started collecting pop bottles at the beach and turning them in
for a penny or two each. He never stopped working, in or out of
the classroom, and wound up graduating from high school in New
Jersey with honors. That earned him a place at the prestigious
University of Pennsylvania in Philadelphia (an Ivy
League oasis that U.S. News & World Report
ranks as one of the top four colleges in America, along with Harvard,
Princeton and Yale).
started out as a pre-med student, but switched to Penn's
famous Wharton School of Business (generally
regarded as America's best business school) after his
sophomore year. While still in college he also returned to
his entrepreneurial roots, running a variety of ventures
from his dorm room that you will have to read about to
couple of years after graduation Ari developed a
fascination with the legal profession after watching the
Senate confirmation hearings on President Reagan's
nomination of Robert Bork for the Supreme Court.
After the brutality his parents had experienced,
tried to help people who couldn't help themselves and
practicing law looked like a good way to do that.
wound up going to Law School at Rutgers where he
earned his law degree and began a journey that took an
unexpected turn into the domain business after he became
embroiled in a legal battle with the giant Hearst
ESQWire.com & SmartName.com
thought that his business domain, ESQWire.com,
was too close to the name of their Esquire Magazine.
When they locked horns, Goldberger got a crash course in
intellectual property law and a lot of domainers are still
benefiting from his experience today. He went on to notch
landmark victories involving disputes over domains like NewZealand.com
and Mexico.com to become one of the industry's most
familiar faces. He has traveled a long, fascinating road
and we will take you along as we relive the ride. Our
newsletter subscribers will receive an email alert when
the story has been posted.
Spectacular Growth Rate Continues
We all know
the domain market has been booming for more than two years now,
but Internet growth is also being reflected in an explosion of new
live sites. Netcraft.com
reports that the Internet enjoyed it's largest month of site
growth ever in May with new blogs and free web sites fueling the
fire. Netcraft said 3.96 million new sites came on line
last month, surpassing the highest previous gain they had recorded
in March 2003 when 3.3 million new sites appeared.
Blogging services enjoyed strong
growth, paced by Google's Blogger, which added more than
660,000 hostnames. The global nature of the blogging phenomenon
was seen in large increases in blogs hosted at Germany's
Intergenia AG and Japan's Excite.co.jp.
While some areas of the economy
are slowing, particularly housing and job growth, those of us in
the domain industry are fortunate to be in the center of an
industry that is continuing to enjoy a phenomenal expansion. This
is the right place at the right time and we believe that the ride
is just beginning!