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    ICANN Meetings Budget and Expenditures
    An Unfinished Budget
    posted by michael on Tuesday July 27 2004, @02:41PM

    Bruce Levinson writes "ICANN approved a $15.8 million budget at their meeting in Kuala Lumpur, the same spending level that the organization initially proposed. However, despite the approval by ICANN's Board, a crucial aspect of the budget remains unfinished, obtaining the revenues to match planned expenditures.

    Although ICANN has decided to almost double their spending in one year, they have yet to secure agreement to obtain commensurate revenues. As ICANN Chairman Vint Cerf explained, "the only issue remaining, although it's complex, is to finalize details of how that money will be contributed by the various constituencies."

    ICANN's approval of drastically increased spending without reaching agreement on how to obtain matching revenues raises serious questions about the organization's budget process and about the integrity of the budget itself, i.e. whether ICANN will be able to spend as much as intended. If ICANN fails to obtain the planned revenues, the organization could find itself either deeply in debt or undertaking emergency spending cuts. Both possibilities could have serious consequences for diverse internet stakeholders that rely on ICANN."




    "InternetNews.com reports that the "biggest holdouts" on the budget are the generic Top Level Domain (gTLD) registrars, "the companies that buy and sell domain names for gTLD extensions like .com and .net -- who will pay for approximately $11.4 million of the $15.8 million budget."

    ICANN has also faced serious objections to the budget from smaller registrars who believe that the ICANN's budget proposal would place them at a substantial competitive disadvantage to the larger registrars. ICANN and the smaller registrars did agree to a three year price cap on fees. ICANN CEO Paul Twomey was quoted as saying that "further talks between the two groups resulted in applying increased pressure on funding relief from alternate sources, like country code TLD (ccTLD) registrars, who have so far escaped much of the funding requirements."

    Despite Dr. Twomey's intentions, there is no indication that ccTLDs will agree to pay increased funding. As ICANNfocus.org has previously noted, the Council of European National Top Level Domain Registries (CENTR) has already informed ICANN that the "budget figures and the contribution asked from ccTLDs is unrealistic and inappropriate."

    When asked what ICANN would do if they had problems collecting contributions, Vint Cerf said, "I would encourage public flogging." Although such witty quips may be amusing, ICANN's stakeholders deserve a more substantive answer."


    [Editor's note: It's instructive to consider the full and thorough debate that took place at the Board meeting on the controversial budget issue. Here it is:

    *VINT CERF: *SO I TAKE IT THAT'S A MOTION FROM IVAN.

    *IVAN MOURA CAMPOS:* IT'S A MOTION.

    *VINT CERF: *IS THERE A SECOND?

    SECOND.

    *VINT CERF:* I'M SORRY. WHERE WAS THE SECOND? THOMAS NILES SECONDS.

    IS THERE FURTHER DISCUSSION OF THE BUDGET RESOLUTION? MIKE.

    *MICHAEL PALAGE:* YES, THANK YOU, MR. CHAIRMAN.

    I'D LIKE TO THANK MY CHAIR, MR. CAMPOS, AND MY FELLOW COMMITTEE MEMBERS, FOR THEIR PATIENCE OVER THE PAST SEVERAL MONTHS, AND IN ADDITION TO THE EXCELLENT WORK OF STAFF, PARTICULARLY KURT PRITZ IN HIS EFFORTS.

    I BELIEVE, AS SOMEONE WHO HAS HAD SOME RESERVATIONS ABOUT THE PARTICULAR MECHANISMS, I BELIEVE THAT THE CURRENT RESOLUTION, WHICH SHOWS THE STAFF'S CONTINUING COLLABORATION TO WORK WITH THE COMMUNITY, IS AN IMPORTANT STEP AND SOMETHING THAT I COULD FULLY SUPPORT.

    *VINT CERF:* THANK YOU, MIKE.

    ARE THERE ANY OTHER COMMENTS ON THIS BUDGET RESOLUTION?

    IN THAT CASE, I WILL CALL FOR A VOTE ON THE BUDGET.

    AS IVAN SAYS, IF YOU VOTE IN FAVOR, YOU WILL BE ESTABLISHING THE BUDGET FOR 2004/2005 AS POSTED, AND YOU WILL BE AUTHORIZING STAFF TO CONTINUE ITS COLLABORATIVE WORK WITH THE CONSTITUENCIES TO ESTABLISH THE ACTUAL FUNDING MECHANISMS.

    ALL THOSE IN FAVOR OF THE BUDGET, PLEASE RAISE YOUR HAND. ONE, TWO, THREE, FOUR, FIVE, SIX, SEVEN, EIGHT, NINE, TEN, 11, 12.

    ARE THERE ANY OPPOSED?

    ARE THERE ANY ABSTENTIONS?

    MR. SECRETARY, IT'S UNANIMOUS. SO THE BUDGET PASSES.

    WE HAVE A NEW BUDGET FOR 2004/2005.

    Isn't nice that the Board aired all the issues, and made the hard choices. We would not want anyone to think this all got fixed up in back rooms...or was being punted to the staff's back rooms...-mf]

     
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      Related Links  
    · Dr. Paul Twomey
    · Vinton G. Cerf
    · Michael Palage
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    · Bruce Levinson
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    · Also by michael
     
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    An Unfinished Budget | Log in/Create an Account | Top | 4 comments | Search Discussion
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    $15million!
    by jimrutt on Sunday August 22 2004, @10:05AM (#14063)
    User #3264 Info

    sigh...

    one of the major strategic goals of the contracts I negotiated between Network Solutions and ICANN was to keep ICANN's source of revenues under control. I will say that the Department of Commerce was also supportive of this.

    The original 1999 contracts would make it difficult for ICANN's budget to exceed $5 or $6 million... which was certainly more than enough for an organization dedicated to a narrowly defined task of co-ordinating a specific set of narrow technical issues.

    Choking off the cash was the most obvious way to keep ICANN from taking the natural path of bureaucracies to grow into all unoccupied adjacent spaces without limits.

    Alas, VeriSign gave up on the principle of cash constriction in the 2001 amendments to the contracts and a $15million budget and an expanding octopus (fortunately, so far an incompetent one) is the result.
    ===================== been there, done that
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