Statement on the Proposed VeriSign Settlement Agreement
Date:
2 December, 2005
Proposed ICANN/VeriSign Settlement Agreement
Background
ICANN has reached an agreement to end all pending litigation over its
long-standing dispute with VeriSign. The settlement agreement documents
have been posted for public comment
<http://www.icann.org/announcements/announcement-24oct05.htm>
and are
subject to final approval of the ICANN Board. ICANN states that, under
the agreement, VeriSign will: withdraw all pending litigation and
arbitration relating to .COM; adopt ICANN's position on a wide range of
issues concerning registry services (such as Sitefinder) and the way
they are introduced; commit to binding international arbitration to
prevent any future disagreements from resulting in costly and disruptive
litigation; and recognize and participate in the ICANN consensus policy
process. The ALAC and other constituencies have raised questions and
concerns about the proposed settlement. The ALAC's statement is
included below.
The ALAC sponsored a public workshop on the proposed settlement at
ICANN's
Vancouver meeting.
A recording
and summary of the workshop are available. The ALAC also met with the
ICANN Board to discuss the proposed settlement and a
recording
of this
meeting
also is available. In addition, the proposed settlement was discussed
in ICANN's public forum in Vancouver.
ICANN's Board has issued a public statement regarding next steps on the
proposal at its Vancouver meeting:
<http://www.icann.org/announcements/announcement-05dec05.htm>.
Comments
The ALAC is continuing to investigate and discuss this agreement and
urges all Internet users, especially .COM registrants, to share their
views on how this agreement might affect them (and on the ALAC's
statement, included below). Send your emails for public posting to
<forum@alac.icann.org>
and
<settlement-comments@icann.org>
.
Statement
Concerns on the proposed ICANN / Verisign settlement
from the At-Large Advisory Committee
1 December 2005
1. We believe that it would be more appropriate to separate the lawsuit
settlement from the contract renegotiation. If the settlement requires
changes to the contract, ICANN and Verisign can amend the current
contract to reflect settlement terms.
2. We are concerned about the loss of accountability and oversight both
of the community over ICANN and of ICANN over Verisign. The external
oversight of ICANN's budget currently provided by the registrars will no
longer exist. The settlement provides no meaningful checks on Verisign's
behavior, unless they misbehave so badly that ICANN voids their
contract. As the registrars have pointed out, the proposed "consensus
process" is new and untested.
3. We are concerned about the use and misuse of personal data. Under
the agreement, Verisign is allowed to do whatever data mining they want
of COM zone usage and access. For example, they could sell DNS traffic
data about pepsi.com to Coca Cola, or about greenpeace.com and other
political sites to governments whose policies they oppose. As a trustee
for the Internet community, ICANN should provide appropriate protections
for the community's data. We are also concerned that such data mining
would be illegal in countries with data privacy laws.
4. We believe that the proposed price increases for the .COM registry
are inappropriate, since the registry is no longer required to offer any
justification for them. We are also concerned about the tripling of
ICANN's per-domain fee. Although the incremental cost to each
individual user will be low, the aggregate cost to users will be in the
tens of millions of dollars per year.
5. We are concerned by the lack of economic and legal analysis of the
effects of the proposed settlement. To the extent that the .COM registry
is a monopoly, it requires stricter regulation than if it is not.
Analysis by a qualified economist of the price sensitivity and
substitutability of .COM and other domains, based on the extensive
historic data, should help understand the situation. Similarly,
qualified legal analysis of the likelihood of success of ICANN's and
Verisign's suits would help quantify the legal risks and costs the
settlement would avoid. Market forces can have an effect on .COM
registry prices in two ways: (a) periodic rebids, and (b) a substitute
service. The current proposal does away with the rebidding, and we doubt
that .BIZ or .INFO or ccTLDs are a substitute for current registrants
who already have branded their .COM address.
6. The proposed settlement makes Verisign the permanent source of the
majority of ICANN's revenue. By making itself dependent on an entity
not accountable to the public, ICANN endangers its independence and
hence endangers ICANN's public trust.
7. We share ICANN's concerns with the current budget and planning
process, which depends in large part on registrar approval and quarterly
financial contributions from numerous sources. We endorse a budget and
funding mechanism that would provide ICANN greater certainty in the
budget planning process and reduce the administrative burden on ICANN of
billing and collections. Nevertheless, we believe very strongly that
ICANN should consult with the registrant and At Large community before
it fundamentally reshapes its funding mechanism through new contracts
with the registries. Ultimately, funds paid to ICANN from registrars or
registries come from us, the At Large community. We encourage ICANN to
engage the community in a larger conversation about how it should be
funded and how its budgets should be created and approved.
8. We are deeply concerned by the lack of transparent process. The
current (2001) .COM contract had a specific renewal timeline that has
been ignored, since the settlement includes a new contract that would
void the current one. ICANN offered no timetable or process for
consideration of the proposed settlement until forced to by the CFIT
lawsuit. The community does not know whether it has a month or a year
to collect its input and offer its advice, nor whether it may be
possible to modify the proposed settlement or it simply has to be
accepted or rejected.
9. With these considerations in mind, the ALAC advises the board to
reject the proposed settlement, to seek qualified advice on the econmic
and legal aspects of any proposed settlement, and to seek a settlement
that addresses our concerns.
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