I strongly urge the Names Council to quickly finalize their draft recommendation concerning the Verisign WLS proposal and send it back to the ICANN Board with a resounding rejection. The need for urgency is based upon the fact that delays will only play into the hands of Verisign and SnapNames and their extensive lobbying and deal making efforts to gain WLS acceptance – at the expense of the rest of the Internet community. The WLS is a bad idea. Why? Because it takes a product available on the open, highly competitive registrar market, where competing products and consumer choice are available, and puts it at the sole-source monopoly registry level of the Internet."

There are other reasons why WLS needs to be rejected. ICANN needs to separate itself from the commonly held belief that it caters to special interests and is “owned” by Verisign. With all of the current issues surrounding Verisign, it is not wise for ICANN to accept the WLS proposal. For instance:

· Verisign is being investigated for deceptive advertising and domain “slamming.” Verisign is targeting unsuspecting domain owners with bogus “invoices” trying to get the consumer to transfer names to Verisign to re-register their names, not with their current registrar, but with Verisign, and often at two to three times the price. There are current lawsuits underway to resolve these issues, plus the issue appears to violate United States Postal Service statutes.

· The recently completed audit by Ernst and Young showed material non-compliance by Verisign to the ICANN Registry agreements. Of particular concern is Ernst & Young’s comment that Verisign “had not established adequate controls that would allow us to obtain sufficient evidence to determine compliance …… because Verisign did not maintain historical records….” With the current accounting scandals in the headlines, the fact that there are material non-compliance issues with the Verisign registry should generate a red flag of concern. ICANN should be very cautious about giving Verisign any additional power and control of the Internet through their monopoly at the registry level, particularly when monopolies have a tendency to abuse their power (and, with the case of Verisign, are in material non-compliance of their registry agreements based on audit findings).

Issues surrounding deceptive advertising, domain slamming, and material non-compliance with the Ernst and Young audit opens up legitimate questions about Verisign’s business practices and conduct. Is it wise, under these present circumstances, to grant them additional monopoly control through the WLS? Although Verisign will argue that issues involving the Verisign Registry are different and separate from those involving the Verisign Registrar, and that there is a wall between these separate entities, remember that at the top of the Verisign organization, financials are consolidated and there is a CEO who does look for advantage for Verisign by working the two separate entities together. WLS conveniently works to Verisign’s advantage at both the registry and registrar level at the expense of the consumer and competing businesses.

ICANN’s future is currently at stake. I think everyone agrees that reform within ICANN is needed. A widely held perception is that Verisign has too much influence and control with ICANN. If ICANN approves the WLS and thus gives Verisign additional monopoly power, it will help secure this perception that ICANN caters to special interests, is not independent, nor serves the best interests of the Internet community. ICANN needs to separate itself from Verisign’s hip by soundly rejecting the WLS proposal. This would announce to the world that ICANN may really be interested in reform and is, indeed, independent and serving the best interests of the whole Internet community – not just Verisign.

Respectfully submitted:

Steve Vincent
CEO, CAS Holdings, Inc.
Dotster Chairman of the Board

Although I have recused myself from the WLS issue, I have a strong objections on potential anti-trust grounds of this constituency voting on anything that recommends/discusses a price.

Take a look at blindhit.com (some nudity), and there are many others out there like them. They pay 5 cents per click. So if you register a dropped name that was previously averaging 1000 hits per day, that's $50 income per day for the new owner, so of course the name is worth a WLS fee of $50 or many times that. You can see from this that even sites which previously had quite low traffic could turn a profit. Those who want to blindly hit you with ads (mostly for pr0n and gambling) are the folks who have the most to gain from the WLS, and VeriSign/Snapnames know that. This is being spun as a benefit to consumers but the vast majority of consumers, including those wanting names, those losing their names, and those who otherwise use the names in the way they were originally intended will all be the poorer for it.

VeriSign doesn't care. They want a bigger part of that action. VeriSign has already shown that they are willing to negotiate/drop the price somewhat and to give registrars a bigger piece, but they still own the pie. It sure looks and smells like something begging for anti-trust action to me. -g