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Auerbach Weighs in for gTLD Lotteries
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I have always disagreed with the ICANN's usually implicit policy that it will not allow any TLD that could ever possibly have a chance of ever failing. (Of course, it does seem that some of the super-seven that it picked two+ years ago may go under, perhaps as the result of boredom if not from financial failure.)
Why shouldn't a TLD be allowed to fail? Who is harmed? Stale URL's and stale e-mail addresses happen all the time even with ICANN's propped up system. (By the way, take a peek at my presentation on the real meaning of "stability" at http://www.cavebear.com/rw/nrc_presentation_july_1 1_2001.ppt [cavebear.com])
The customers of TLDs ought to be able to know beforehand enough information to decide whether they want to build their brand on the foundation provided by a particular TLD. (I am excepting from this those people who were compelled to use the legacy .com, .net, .org TLDs because those were the only ones available.)
If there is reason for a rock-solid TLD, that stability ought to come at a cost to its customers. If there is a need for a TLD that offers fewer guarantees - perhaps for transient events like movie web sites - then who cares if it is financially and lasts only for a while?
Why not treat TLDs like securities? Why not make the information about factors relevant to long term stability of a TLD available to potential customers - a kind of TLD prospectus - and let the customers decide whether they want to build on that TLD?
Another aspect of this is that ICANN or, better yet, an independent body, could periodically audit TLD operations and issue an opinion letter indicating whether that TLD engages in adequate business asset protection procedures (such procedures would enable the hulk of a failed TLD to be picked up by a successor.) Having that kind of mechanism gives the customers the protection of knowing that at least their registration data won't be lost and that if all else fails they can pick up the relic and resume service.
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Re:A question re less market, more community
by KarlAuerbach
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I agree with the substance of Karl's remarks. Economists distinguish between first best and second best solutions.
Allowing TLDs to fail is the first best solution in the economic sense. This would allow the TLD slot or name to be reallocated by the market.
However, there is strong resistance within the ICANN community to the notion of failing TLDs. There may be some economic justification for this. If a significant number of TLDs fail, this might create a negative reputational externality. Translation: the fact that some TLDs failed might translate into a public perception that the DNS is not reliable.
Assuming ICANN (for either sound or unsound reasons) decides not to allow TLDs to fail, then the question becomes what is the second best solution. My prior post suggests that one implication of a system that requires TLDs to remain in operation (so long as thier are paying SLD registrants) is constrained expansion of the root space.
In other words, I agree with Karl Auerbach at the level of theory, but I think it is important to consider the possibility that ICANN will not be convinced to allow TLDs to fail.Lawrence Solum
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