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    The DoC and XXX | Log in/Create an Account | Top | 72 comments | Search Discussion
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    "Think Globally and Act Locally"
    by Anonymous on Wednesday August 24 2005, @08:42AM (#16066)
    TAXING DOMAIN NAME SERVERS
    or "Think Globally and Act Locally"...

    Now that the elections are over in the U.S. It appears that
    some governments and local areas are quickly beginning
    to see the light, that the Internet is a potential source of
    tax revenue. This could also be a result of the windfall
    profits being reaped by Network Solutions, Inc. and
    their owner, SAIC, from its "cooperative agreement"
    with the National Science Foundation (NSF) which is
    largely funded by the U.S. Government.

    State governments and local communities are beginning
    to see that "tax-like" dollars for domain registrations are
    being sent to Virginia from all around the world. As usual,
    the Washington, D.C. area economy is the beneficiary
    and states get little in return. In the past, people would
    claim that free registrations in the US. domain allowed
    people an alternative, and these "Internet Taxes" were
    not a concern.

    The US. domain is no longer totally free. Companies
    are being delegated city's names and in some cases
    they are sending invoices without the registrants' prior
    approval. To make matters worse, some of these
    companies are not operating in the state where the
    city is located. This raises questions about business
    licensing, registrations and interstate commerce.

    Even though U.S. Internet users are constantly being told
    that they should "think globally" and avoid U.S.-centric
    views, when the rubber hits the road, Internet Politicians
    "act locally" to protect their own interests. This is
    no different than what has been happening for centuries,
    all around the world, with government politicians.

    As government politicians begin to see the "taxation"
    patterns and revenue flows, there is little doubt that
    they will become interested in mapping the Internet
    to existing rules and regulations. One of the easiest
    ways to do this is via the domain registration system.

    Because of all of the discussions about new top level
    domains and domain registries, people are becoming
    more educated about the technology and the flexibility
    of the systems. Many people have been mislead that
    the system is rigid and "Internet Taxes" must be paid
    to those that maintain the system and no one else
    can participate. This is clearly not the case.

    One of the keys to controlling the Internet domain
    system rests with the root name servers. Internet
    Service Providers use these root name servers to
    help their subscribers locate web sites and e-mail
    destinations. If ISPs are "encouraged", via legislation
    or regulation, to use state supplied (or supported)
    root name servers, the state can insert itself into
    the domain name look-up flow, with very little effort,
    and can bring "Internet Tax" dollars back to the
    state (or community) where the commerce is
    originating.

    The arrangement would be very simple, the state
    would provide a small collection of root name
    servers and delegate all of the top level domains
    to registries located in that state. The major
    top level domains such as .COM, .NET, and .ORG could be easily operated by local agencies
    under "cooperative agreements" with the state.
    Those agreements could be made with ISPs
    in the state who cooperate with the plan.

    With such an arrangement, companies currently
    registered in the .COM domain would have to
    register in each state (or region) where they wanted
    to "easily" do business. They could start with
    a "federal registration" as they do today and
    then reproduce that in each state. Fifty states
    at $50/year could cost a company $2,500.
    At a more realistic cost of $10/state, these
    fees could be brought into line with other
    corporate filing fees currently levied by states.
    To discourage changes, a fee could be charged
    for any transaction, just as most states do today.

    This process is nothing new to corporations
    who must register as a "foreign corporation" in
    all the states where they have operations. (Since
    people could always bypass the domain name
    system by using an IP address people could
    still reach a company, the hard way).

    The registration fees could help to fund Internet
    infrastructure in that state and would not have to
    be sent to a Washington, D.C. suburb. Also, the
    technical burden on the companies would not be
    high because all states could direct their .COM
    name servers to the same corporate name servers
    now supplied by the company (unless the company
    wanted a different DNS data base for a different
    region of the country).

    While it would be nice to think that everyone is
    going to "think globally" and "act globally" it is
    clear that this is not the case. Pandora's box
    was opened when the NSF allowed for "Internet
    Taxes" to be levied without representation.
    Those taxes have been enjoyed by a select
    group of individuals who keep telling everyone
    that there are no other solutions.

    Many people have witnessed the bitter battles
    over the domain name system and the positioning
    for revenue opportunities and windfall profits.
    These battles are just getting started. The next
    round of top level domain expansion is likely
    to attract large corporate players and it appears
    that the Internet Politicians are more willing to
    turn things over to big money, than the local
    communities.

    One solution available to local politicians is to
    take that global NSF action and apply it at a local
    level. They can now "think globally" and "act locally"
    and keep those tax dollars in their community.
    With a small change for ISPs, and some minor
    investment in infrastructure, a state can insert
    itself into the domain name system and follow
    the model established by the Internet Politicians.
    [ Reply to This | Parent ]


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