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    Auerbach Weighs in for gTLD Lotteries | Log in/Create an Account | Top | 49 comments | Search Discussion
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    Re:This is a non-problem
    by KarlAuerbach on Sunday April 06 2003, @02:25PM (#11435)
    User #3243 Info | http://www.cavebear.com/
    I don't see how, in a market with many fewer items for sale than people who want those items - such as the TLD marketplace - that an auction ends up with any result other than the scarce resources ending up in the hands of those who have the most money to pay.

    Having lived in California and endured the manipulative creation of artificial and minipulated scarcity of electricial power - which cost me and the other residents of my state many billions of dollars - I'm less than fond of using auction systems to allocate scarce resources, particularly when the supply of those resources (electricity or TLDs) can be (and has been) manipulated.

    As I said in my note, not everything in life is reducible to dollars. Having multiple pools of resources, some up for auction, some up lottery, etc, may be a viable solution. However, those approaches do require that someone, somewhere act as a god-figure and partition the resources into allocation pools.

    The big issue is scacity - artificially created scarcity - that creates a situation in which the availability of new TLDs will so far outstrip demand that "normal" economic tensions will never have a chance to come into play.

    I've suggested 10,000 new TLD slots a year - that way in a hundred years we end up with a million TLDs. I do not see that as technically unreasonable. And I perceive that number as having a qualititative better chance of inducing the Nirvana of a real marketplace in TLDs than the less than 1.4 per year rate that ICANN has adopted.
    [ Reply to This | Parent ]
    Re:This is a non-problem by KarlAuerbach
    Re:This is a non-problem
    by lsolum on Sunday April 06 2003, @05:00PM (#11441)
    User #3416 Info | http://lsolum.blogspot.com/
    Karl Auerbach, for whom I have enormous respect, writes:
      Having lived in California and endured the manipulative creation of artificial and minipulated scarcity of electricial power - which cost me and the other residents of my state many billions of dollars - I'm less than fond of using auction systems to allocate scarce resources, particularly when the supply of those resources (electricity or TLDs) can be (and has been) manipulated.
    California's electricity market deregulation is not analagous to TLD auctions. California maintained price controls over the retail market and deregulated prices at the wholesale level. This, by itself, was a recipe of disastor. Moreover, utilities were required by statute to purchase electricity on the spot market and forbidden to enter into long-term supply contracts. This was not a market in any meaningful sense of the term.

    But Karl's warning should be heeded. Auctions or lotteries can be maniuplated. That is why it is extremely important that any system of allocating new TLDs not be designed by existing stakeholders. That is a sure-fire way to get a system that is subject to the cartelization of bidders (auction) or rigging by secondary purchasers (lottery).Lawrence Solum
    [ Reply to This | Parent ]


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