Harold,
At 09:50 AM 2/26/99 -0500, Mikki Barry wrote:
>>From: "Harold Feld" <[EMAIL PROTECTED]>
>>I find Dave Crocker's statement that the USG has no power
>>over NSI incredible. Dave, do you believe that NSI submitted to
>>ICANN jurisdiction (before it was even settled what the shape would
>>be, essentially buying a pig in a poke) and agreed to open its
>>databases because it *wanted* to do so?
I fully acknowledge that my assessment is incredible. The idea that an
entity like the USG has no meaningful power over a situation like this is
quite unimaginable. Alas, that does not make the assessment incorrect.
Let me also be clear that my reference is to the administrative/regulatory
responsibilities, exercised through NSF, Commerce and the White House. The
courts are an entirely separate matter.
When a series of negotiations work almost exclusively to the benefit of one
party, then there is a practical basis for saying that the second party has
no meaningful power. When the one party makes concessions only due to
other forces, then the second party cannot take credit for the concessions.
To whit:
The original commercialization effort worked only to the benefit of NSI,
granting them a protected and exponentially growing revenue stream,
charging a rate 5-35 times higher than necessary to recover
costs. Customers were, and continue to be, thoroughly excluded from the
decision processes and most customers suffer accordingly in one fashion or
another.
Internet processes entirely independent of the US government pursued
changes to gTLD administration and were in the final stages of implementing
those changes. The changes would have created greater alternatives for
consumers and forced NSI into a much more level playing field. This was 3
years ago. Intercession by the USG worked to disable that change
process. The primary beneficiary of this has been NSI, and certainly not
consumers or potential competitors.
The specific details of USG agreements with NSI have left NSI with no
meaningful oversight. The utter uselessness of the supposed technical
advisory review is just a recent example.
A number of legal challenges are underway or remain a matter of serious
potential -- where "potential" mean "threat" to NSI -- such as challenging
its monopoly position or its actions taken to use that its leverage.
I therefore claim that the only significant pressures are from outside the
USG and carry primary responsibility for guaranteeing that changes will
take place. In this context the behavior of the USG has been to frustrate
and delay those changes, rather than to expedite them. In effect, the USG
actions have only made NSI's position better than it otherwise would have been.
One might, therefore, say this makes it clear that my claim is incorrect...
because it shows that the USG obviously DOES have power: it has been highly
effective in making decisions that improve NSI's position to the detriment
of consumers and potential competitors, compared to the alternative
decisions that would have been imposed on NSI were the USG not choosing to
get in the way.
>>At the moment, NSI has a monopoly on gTLDs, and is dominant
Correct. And that describes a particular market quite nicely, since it
distinguishes "global" domain names from those names that have a national
alignment.
>>player (but not a monopoly) in domain names. It is unclear what
>>the relevant market should be. POC/CORE/etc. have consistently
Not sure what you mean by "the relevant market". gTLD space can be
discussed from a range of perspectives. At this point what matters most is
creating competitive activity in that space, so that the market can explore
choices and find segments that it prefers.
>>defined "monopoly" on a TLD by TLD basis, thus the need to have
>>a shared registry to eliminate the monopoly. I (and other supporters
A broad range of discussions have similarly concluded that the technical
and operational realities at the base of domain name use mitigate achieving
a legitimate competitive market, due to customer lock-in that occurs after
the initial "purchase" decision. This requires that the registry be
operated with a set of checks and balances beyond simple market forces.
For any given TLD, there can be only one registry. That registry
inherently obtains undue control over those registered under the TLD. That
undue control need to be... controlled.
>>of proprietary TLDs) think this is to narrow a market definition.
>>This is like defining the market as "Coke" rather than as
>>"soda" or even "cola."
Supporters of proprietary TLDs see an opportunity for exercising the undue
control to obtain undue profit margins. NSI's history has provided an
excellent demonstration that this concern is quite valid.
>>Even if it is a monopoly, it is unclear what the appropriate
>>remedy should be. You seem unsatisfied with any solution
>>that leaves NSI has anything other than a smoking crater.
On the contrary, the original plan -- the IAHC proposal -- went out of its
way to make concessions to NSI. For example, the plan was not nearly as
severe on NSI as the courts were to AT&T when breaking it up, which
vigorously re-distributed AT&T's customer base among the competition.
It remains curious that careful criticism of NSI's performance and policies
is viewed as somehow wishing NSI ill. Why it is that desiring open
development and review of strategic DNS operations policies and seeking
legitimate competition, rather than some sort of ghost-version with a bit
of competition appearance and no meaningful content, is a real mystery.
>>utilized by the Telecom Act of 1996. NSI is being forced to
>>unbundle its registration services in the same way the RBOCs
>>are theoretically being forced to unbundle their network
>>elements. This approach also worked well in the natural
>>gas market and the electric market.
In fact, NSI is not being forced to unbundle its services meaningfully. It
retains control over the registry and retains a remarkable amount of
control over registrar space. Best of all is that, as has been recently
documented, the NSI "registry" gives special favor to the NSI "registrar".
>>Whether you think it is the correct approach is a point
>>that can be argued, but it overstates the case to the point
>>of absurdity to say that USG has not, and therefore cannot, taken
>>steps to terminate the existing NSI monopoly on .com, .org, and .net.
My position WOULD be absurd, if one did not have the minor reality of
continued NSI exclusivity and utterly no new names or competition. This
condition has persisted for roughly 5 years.
The bottom line is that NSI's bottom line grows massively through a
government granted and protected monopoly, charging excessive rates, giving
mediocre service, and making major policy decisions affecting significant
aspects of Internet operation without public review or control.
The bottom line is that consumers and potential competitors tend suffer by
this process and NSI continues to benefit greatly.
The USG has been so consistently poor at doing its job of controlling the
situation, so as to make it a practical reality that the USG is not the
source of power for the changes that are taking place.
d/
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
Dave Crocker Tel: +1 408 246 8253
Brandenburg Consulting Fax: +1 408 273 6464
675 Spruce Drive <http://www.brandenburg.com>
Sunnyvale, CA 94086 USA <mailto:[EMAIL PROTECTED]>
