Esther's response

[James Love <love@cptech.org>]

This is Esther Dyson's response to the June 11, 1999 letter from James
Love and Ralph Nader regarding ICANN.  I am currently in Australia, and
won't be able to do much follow-up on this issue until next week.  

Jamie Love

-------


>From edyson@edventure.com Wed Jun 16 07:09:12 1999
Date: Tue, 15 Jun 1999 10:18:32 -0400
From: Esther Dyson <edyson@edventure.com>
To: love@cptech.org

Subject: Re: Letter to Esther Dyson from Ralph Nader and James Love  regarding
    ICANN


Ralph Nader
P.O. Box 19312
Washington, DC 20036

James Love
Consumer Project on Technology
P.O. Box 19367, Washington, DC 20036
love@cptech.org
http://www.cptech.org


Dear Ralph and Jamie:

Thank you both for your letter of June 11.  The questions you ask are
legitimate, and we have legitimate answers to them.  What is illegitimate
is the motivation of some of the people who keep asking the same questions
without paying attention to the answers.

 I hope that my answers below will respond to your concerns. Indeed, I
hope that they may persuade you to join us in our fight to remove monopoly
from the business of registering domain names and help keep the Net free
for small businesses and individuals to use as they see fit. As a longtime
champion of individual rights and against monopolies, you hold common
cause with us.

Accordingly, I'd like to start by setting some context before answering
your specific questions.  My response is intended not as an attack against
anyone, but as a defense against attacks which are hindering us at ICANN
from doing the tasks for which we were created.

As it happens, I'll be in Washington today (Tuesday), and I'd be happy to
meet with either or both of you. Please let me know by e-mail or by
calling my office at (212) XXX-XXXX. You can also reach me later this
afternoon at (202) XXX-XXXX.

Scene-setting

I'd like to set the scene for the answers to your questions by noting that
ICANN is a newly minted organization with many of its organizational
processes still under way. It was created primarily in response to the
Internet's extraordinary growth, which required a transition from informal
management of its technical infrastructure, to something more formal and
predictable, and subject to public (but not directly government)
oversight.

The Initial Board is following the guidelines set forth in the United
States Government's policy paper of last June (the White Paper), as
further amplified by the Memorandum of Understanding/Joint Project
Agreement ICANN signed with the Department of Commerce in November.  
These documents comprise an agenda both important and ambitious, and we
are doing our best to work our way through it with the help of public
input, several formal advisory committees, and the so-called Supporting
Organizations that make up ICANN's internal structure.  We welcome your
input, both now and in the future.

The White Paper articulates no Internet governance role for ICANN, and the
Initial Board shares that (negative) view.  Therefore, ICANN does not
"aspire to address" any Internet governance issues; in effect, it governs
the plumbing, not the people. It has a very limited mandate to administer
certain (largely technical) aspects of the Internet infrastructure in
general and the Domain Name System in particular.

One important aspect of its mandate is the introduction of competition
into the business of registering domain names, under an agreement with the
US Government. In this particular task, naturally enough, it is meeting
fierce resistance from the private government contractor that has been the
monopoly provider of DNS services, Network Solutions -- a company that has
transformed itself from an unknown start-up at the time (1992) when it
first entered into a contract with the National Science Foundation, into a
subsidiary of a large privately-owned government contractor today, with a
market value of over $2 billion for its own publicly traded stock [NSOL].
Given this history, and the wealth that has been created through its
administration of those government contracts, NSI is in no hurry to see
that monopoly eroded.  Since this very goal is a principal short-run
objective of ICANN, NSI has apparently concluded that its interests are
not consistent with ICANN's success. Thus it has been funding and
otherwise encouraging a variety of individuals and entities to throw sand
in the gears whenever possible, from as many directions as possible.

Of course, "I want to protect my monopoly" is hardly an attractive slogan,
and so NSI uses the language of democracy instead. In addition, it
encourages and supports others who have a variety of reasons -- economic,
philosophical or political -- to be unhappy with the way the community
consensus has formed.  Of course, many of these people are sincere in
their concerns about the transparency of ICANN's operations and their
interest in fostering public debate about its activities - as you are.  
But ICANN's goals and its actions are in fact the result of public debate
and consensus - though not of unanimity.

NSI's rhetoric is also quite inconsistent with its conduct.  The company
operates under the cloak of nondisclosure agreements covering not just
technical and commercial information, but also the experiences of the
ICANN-accredited registrars now attempting to open up the domain-name
registration business to competition.  Furthermore, Network Solutions
claims "proprietary" rights in databases and techniques developed under
government contract as a reason for refusing to release information and
for expensive license fees. The nondisclosure agreements it imposes on
competing registrars are so onerous that many who wish to participate in
ICANN's competition initiative cannot do so without permanently
restricting their ability to compete in this space in the future.

Forgive this lengthy preamble, but I wanted you to understand the origin
of many of the complaints you have been hearing - basically, the effective
PR of a monopolist seeking to postpone the inevitable arrival of
competition fostered by ICANN. Since you have not been actively involved
in this project over the several years it has been underway, you may not
appreciate the power struggles involved^Åbut given your long history of
fighting monopoly power, I thought it was important to provide you with
some background.

Now of course, there are many participants in this debate who are not NSI
agents, and who have honestly differing views about particular issues.
Since ICANN is a consensus, non-governmental body, we are charged to
listen to all such views and debate them, and eventually we reach a
consensus position.  As a non-elected initial board, we take this duty
very seriously; our method is to foster and then recognize consensus
rather than force it. This has certainly been the case to date: Every
policy developed in ICANN has been the product of a comprehensive notice
and comment process, and every effort has been made to reflect in ICANN
policies the consensus position to the extent we can determine it.  Of
course, consensus is not unanimity, and there are people of good faith who
disagree with certain specific ICANN policies. We try hard to explain the
reasons and trade-offs for each decision. In the end, we realize we can
achieve legitimacy only if a substantial number of those affected agree
that we are making the right compromises most of the time.  (I myself do
not agree with every facet of every ICANN decision, which is why ICANN has
a board and not just a chairman!)

With this background, let me try to respond to your specific questions.

IP issues

On the intellectual property issues, in its White Paper the Department of
Commerce requested the World Intellectual Property Organization to conduct
a study for submission to ICANN concerning how to operate the domain name
system so as to minimize conflicts with trademark laws throughout the
world.  These issues include the need for and scope of alternative dispute
resolution mechanisms that could work despite the varying legal regimes
that control the use and protection of trademarks and similar intellectual
property on the global Internet; the desirability of special rules for
so-called "famous names;" and the intellectual property issues raised by
the possible addition of new Top-Level Domains (beyond .com, .net and
.org). WIPO led a 10-month study, held 15 public meetings with more than
1300 participants, and ultimately produced a set of recommendations that
it transmitted to ICANN this April.

At its meeting in Berlin in May, ICANN considered the WIPO report and
recommendations, and the many public comments (both online and in-person)
about them.  Ultimately, the Board endorsed WIPO's call for consistent
administrative dispute resolution procedures in principle, and referred
that recommendation to its newly formed constituent unit, the Domain Name
Supporting Organization, for its review and specific implementation
recommendations.  It also referred most of the rest of the report to the
DNSO for further study, without endorsing a particular direction.  (And it
noted that it had already implemented some administrative recommendations,
concerning prepayment and contact information, in its standard registrar
contract.)

The DNSO's input will also be fully subject to the ICANN notice and
comment procedures before ICANN's next full-scale meeting in August, where
the board will once again consider them in the light of public comments
and look for consensus before deciding whether and how they should be
implemented (or modified).

The root server system

On the root server system, the White Paper called for improvements in the
system and ICANN has formed a committee of experts to look into that
complex subject.  The committee has provided reports on its work at each
of the last two public meetings, and has ensured that the system does not
face Y2K vulnerabilities At this moment, ICANN does not control the root
servers, although it expects to do so by the end of the transition period.  
In the meantime, ICANN is continuing to administer TLD assignments and
related root server policies in the same manner as they were managed by
Dr. Jon Postel before ICANN was formed.  Any policies relating to the root
servers under ICANN oversight will, of course, be subject to the standard
notice, comment and consensus procedures that precede any ICANN decision
that could significantly affect the Internet.

Review and recourse

ICANN is a private organization; its actions are fully subject to legal
review and oversight.  Thus, if any action is believed to impair some
legal right, a complainant would have full recourse to any relevant court.  
In addition, ICANN has a fully developed reconsideration procedure, and is
in the process of establishing an Independent Review entity to evaluate
any claim that ICANN has acted inconsistently with its Articles or Bylaws.

Financial issues

The White Paper assumed that, since the private non-profit organization it
called for (now ICANN) would not be funded by governments, it would have
to be funded by by the beneficiaries of its technical and policy
development activities.  Since it is still very early in ICANN's
existence, and we have no experience to determine the level of resources
necessary to carry out its duties, ICANN has (again, after a full process
of notice and comment) established a fee not to exceed $1 annually per
name registration -- which fee would be paid by the business entities
actually making the registration. (You asked by what authority we will
charge the fees; we will do so in accordance with a contract that we will
execute with each registrar - a group that we still hope will soon include
NSI.)

 Since ICANN seeks only to recover its costs, we believe the $1 fee will
be adjusted downward as the early organizational expenses are gradually
reduced and as the number of names registered increases.  In addition, if
ICANN succeeds in fostering competition in the registration process, it is
likely that the overall consumer price of registrations will come down
dramatically. Currently, it is set unilaterally by NSI at $70 for a
two-year registration (NSI does not permit one-year registrations). A
competition-spurred reduction would lead to a substantial net consumer
benefit due to ICANN's activities.

Finally, ICANN's activities are strictly limited by its Articles and
Bylaws, and any fees it collects can be used only to offset the costs of
these specific activities.  Since ICANN is intended to be a 501(c)(3)
tax-exempt organization, it is also limited by IRS regulations in any
expenditure of funds aimed at influencing legislation. If you would like
additional details on the expenses we foresee for the fiscal year
beginning July 1 (just under $6 million), you can find a comprehensive
budget document posted at our Website for public viewing.

The role of the Initial/Interim Board

Finally, I would like to consider your question whether ICANN's "interim"
Board is making policy decisions it should not be making.  First of all,
on semantics:  NSI has promoted the notion that ICANN somehow has violated
the White Paper by having an "initial" Board rather than an "interim"
Board. This argument is pointless. The White Paper calls for the consensus
entity that became ICANN to "appoint, on an interim basis, an initial
Board of Directors (an Interim Board)"  (emphasis in original]. This
"initial" Board was to serve until it established "a system of electing a
Board of Directors."  Thus, the terms "initial" and "interim" were clearly
synonymous in the White Paper.

More importantly, the White Paper made it absolutely clear that the Board
(whatever it was called) should deal with a variety of substantive policy
issues in addition to establishing the procedures and structures necessary
to create an elected Board going forward.  The White Paper specifically
called on the "initial" Board to formulate the necessary consensus
policies to allow competition to be introduced as quickly as possible.  
These policies included "qualifications for domain name registries and
domain name registrars" and "policies for the addition of TLDs."  
Finally, in the White Paper, the United States government said it would
ask WIPO to "develop a set of recommendations for trademark/ domain name
dispute resolutions and other issues to be presented to the Interim Board
for its consideration."

The current Board, which I assure you would very much like keep its tenure
as short as possible consistent with doing its duty, has undertaken no
policy initiatives not expressly contemplated in the White Paper, or for
which there was not some urgency of action necessary to meet the principal
objectives of the White Paper and of ICANN itself.

Having said all this, I would like to mention that we have made
significant progress toward a fully elected Board.  The first of the three
Supporting Organizations responsible for electing nine of the 19 Board
members is now in existence (the DNSO), and we expect it to provide its
three Directors soon.  The other two SO's are currently organizing
themselves, and we hope that they will provide their three Directors each
by early next year. ICANN's Membership Advisory Committee has presented
recommendations to the ICANN Board dealing with the establishment of the
At Large membership that will elect nine Directors, and the ICANN staff
and counsel are currently figuring out how to implement them.  This latter
effort has proven complicated, since it is critical that the membership
and election process that will produce fully half of the Board be fair,
open, resistant to fraud or capture, and as widely inclusive of the full
range of users and others affected by ICANN policies as possible.

Conclusion

Thus, we have made much progress on many fronts, thanks largely to
enormous volunteer contributions of many, many people, from Directors (who
are not compensated other than out-of-pocket expenses and cannot be
elected to the Board for two years following their current service) to
hundreds of individuals and entities that want this unique process to
work. Our work has, however, been made much more difficult by the direct
and indirect opposition of NSI, the primary entity that stands to gain
from such delay. I suppose this is an understandable approach for a
monopolist threatened by new competition, but it is still disappointing,
to me and to the Internet community as a whole. It would have been much
simpler, and a lot more pleasant, to have seen NSI work with the rest of
the community to make this obviously necessary transition to open
competition and policy-based management of the Internet's vital technical
infrastructure.  Still, we will persevere, and we will succeed.

I hope this is responsive to your questions.  Perhaps you could help us to
generate even more momentum behind the forces of Internet competition and
move away from monopoly as quickly as possible. We would greatly
appreciate your assistance in this effort.  If you have further questions,
please call on me, our Interim President Mike Roberts, or our Chief
Counsel Joe Sims. We would be glad to try to answer them at your
convenience and to gain your understanding and support.

Yours truly,


Esther Dyson
Interim Chairman, Internet Corporation for Assigned Names and Numbers (ICANN) 


On  11/06/99 -0400, you wrote:
>June 11, 1999
>
>
>                        Ralph Nader
>                        P.O. Box 19312
>                        Washington, DC 20036
>
>                        James Love
>                        Consumer Project on Technology
>                        P.O. Box 19367, Washington, DC 20036
>                        love@cptech.org
>                        http://www.cptech.org
>
>
>Esther  Dyson
><edyson@edventure.com>
>Chairman
>Internet Corporation for Assigned Names and Numbers
>
>
>Dear Ms Dyson,
>
>Could you tell us the scope of internet governance issues that
>the Internet Corporation for Assigned Names and Numbers (ICANN)
>aspires to address?  For example, does ICANN seek to make any
>decisions regarding allocation of trademark rights to those who
>seek domain names?  And will ICANN use its control over root name
>servers to block access to any IP address or domain name for any
>reason?  If so, could you give us an idea of what those reasons
>might be, and how those decisions will be made, and what legal
>recourse persons would have regarding ICANN decisions?
>
>Also, does ICANN seek the authority to levy fees on the use of
>domain names?  If so, what are the legally binding limits on the
>use of funds from those fees by ICANN?  Under any circumstances
>will the ICANN be permitted to use these funds to promote public
>policy objectives on broader internet governance issues?
>
>Finally, is ICANN's interim board making substantive policy
>decisions, before a membership is in place?  If so, can you
>explain how this start-up procedure is justified given the terms
>of your agreement with the United States government?
>
>You are known for being meticulous.  We await your specific
>replies to these questions.
>
>Thank you.
>
>
>Sincerely
>
>
>
>Ralph Nader             James Love
>
>
>
>--
>James Love, Director, Consumer Project on Technology
>I can be reached at love@cptech.org, by telephone 202.387.8030,
>by fax at 202.234.5176. CPT web page is http://www.cptech.org
>






Esther Dyson			Always make new mistakes!
chairman, EDventure Holdings
interim chairman, Internet Corp. for Assigned Names & Numbers
edyson@edventure.com
1 (212) 924-8800
1 (212) 924-0240 fax
104 Fifth Avenue (between 15th and 16th Streets; 20th floor)
New York, NY 10011 USA
http://www.edventure.com                    http://www.icann.org

High-Tech Forum in Europe:  24 to 26 October 1999, Budapest
PC Forum: March 12 to 15, 2000, Scottsdale (Phoenix), Arizona 
Book:  "Release 2.0: A design for living in the digital age" 



-------------------------------
James Love 
Center for Study of Responsive Law | Consumer Project on Technology 
P.O. Box 19367, Washington, DC 20036 | http://www.cptech.org
Voice 202/387-8030 | Fax 202/234-5176 | love@cptech.org