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News

September 2, 2002 - Stop Verisign from encroaching on the rights of its smaller competitors, eliminating consumer choice and reducing competition in the domain name business!

Verisign, formerly Network Solutions, once held a monopoly in the domain name registration business. In 1999, competition was introduced by the creation of ICANN, a non-profit corporation set up by the Department of Commerce, to regulate this critical piece of the Internet infrastructure. Since this important legislation passed and over 100 new registrars have joined the domain name market, Verisign has fought tooth and nail to prevent these companies from competing fairly and equally in the marketplace. Because Verisign continues to operate one of competing registrar businesses AND the single-source registry business, which all of the registrars are forced to deal with for registration, they remain positioned to exert this undue influence over their competitors in many respects.

The latest example of Verisigns abusive market tactics is in the area of distribution of expiring domain names, which refers to domain names which have reached the end of their registration terms and therefore are no longer legally registered domains (They legally shouldnt exist at all at this stage). An equitable system currently exists in which each competing registrar, including Verisign, controls a number of connections to the registry with which to compete to register names that once existed but are now deleted. Many of Verisigns competitors have utilized this capability to develop innovative product offerings, generate revenue, new customers, and profits and to offer consumers a number of options for pursuing the expired domain names that they desire. Verisign, after struggling for several quarters and going through some staff downsizing, looks unfavorably upon the success of its competitors and is exerting its influence to capture this revenue for itself. They proposed a Waiting List Service (WLS) to be provided by the registry, under which interested parties would pay an additional $30 or so for the future right to register a domain if and when that domain expires. This proposal would limit consumer options to one since a WLS purchase would trump all other avenues and competing methods for acquiring the name, put all the secondary domain registration revenue into the hands of one company as opposed to leaving it spread throughout the industry, and further inflate the coffers of the industry giant at the expense of its smaller competitors. Despite the opposition of key constituencies in the Internet community and within ICANN itself, and without any clear explanation of its reasoning or decision-making process, ICANNs board approved this proposal and the WLS is set to take effect around June of 2003 for the distribution of all expiring domain names in the .com, .net and .org TLDs.

Verisigns co-optation of the secondary domain name market through the implementation of WLS must be prevented to avoid long-term damage to the integrity of the industry and to consumers. If WLS is implemented, it will:

a. Eliminate the various options consumers now have in the pursuit of expiring domain names by changing an open platform with equal access to all registrars to a closed system controlled exclusively by Verisign (i.e., a monopoly)

b. Endanger the existence of many smaller competitors of Verisign by eliminating a key source of revenue and profit.

c. Raise the price of domain registration substantially without any clear rising of costs, in conflict with the agreement signed with the DOC and all for the benefit of one enormous company.

d. Re-affirm the actions of a weakened, lame-duck ICANN board which in the past has been shown to be beholden to Verisign and unresponsive to the needs of domain name holders.

e. Set the precedent that Verisign can appropriate any technology or dominate any market within the domain business at any time regardless of the desires of others.

Now is the time to voice your opinion to the folly of the WLS system and how it directly undermines the idea of competition in the domain name industry and an equal playing field for all. You may oppose WLS by contacting the following organizations:

1. NTIA Office of Policy Analysis and Development U.S. Department of Commerce, Room 4725 Washington, D.C. 20230 Phone: (202) 482-1880 Fax: (202) 482-6173 email: webopad@ntia.doc.gov

These guys are the department within the Department of Commerce that is supposed to handle the day to day dealings regarding ICANN and domain names. Are they protecting you or letting Verisign do as it pleases?

2. Department of Justice, Antitrust Division Mr. James Tierney, Division Head antitrust@doj.gov 600 E Street NW Washington, DC 20530

This division is in charged of preventing monopolistic activity, such as the WLS. Also, the DOJ needs to enforce existing contracts with the Department of Commerce. Their position on the WLS has not been made public, but we believe its overdue.

3. Write to Your Congressional Representatives: http://www.house.gov/writerep/


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