Congress Jumps Into Internet Domain Name Brouhaha

By Anne Gallagher, Contributing WriterThe dogfight over issues related to injecting competition into the Internet domain name process spilled into public at a hearing last month, where House lawmakers probed the doings of the Internet Corporation for Assigned Names and Numbers.The July 22 hearing before the House Commerce Committee's subcommittee on oversight and investigation stemmed from a series of complaints that ICANN's operations are getting out of hand and that it is charging inappropriate name registration fees.ICANN is a non-profit group that is to oversee transition of the Internet domain name process into a competitive business under a policy decision last year by the Clinton administration. That shift has been a sticky one, however, as Network Solutions Inc., the Herndon, Va., company with which the government had an exclusive arrangement to register most addresses, hashes out a host of intellectual property and other issues with the non-profit group.Complaints about Internet domain name management pushed ICANN to announce just one day before the hearing that it would implement a number a changes, including suspension of a highly controversial registration fee. The group had planned to charge a $1 fee on every address to fund its operations.At the House hearing, the organization was criticized openly for the $1 name fee it has charged Internet registrars. Critics charge the fee is illegal and allows ICANN to operate as a pseudo-federal regulator. The Commerce Department, which tasked ICANN to manage the Internet domain name process, also has pushed to eliminate the fee. But ICANN officials have insisted it is a bottom-line matter and argued that getting rid of the fee would put them under financially.As a result of the criticisms, a number of initiatives were outlined at the hearing directing ICANN to make several changes by the end of the year, including eliminating the fee."Although the user fee may be determined to be an appropriate method for funding ICANN's activities, it has become controversial, and we believe a permanent financing method should not be adopted until after nine elected members are added to the ICANN board in November," Andrew Pincus, Commerce Department general counsel, said at the subcommittee hearing.ICANN officials agreed to Commerce Department recommendations regarding board elections and public meetings over the next few months. They also agreed reluctantly to suspend the user fee until the ICANN board of directors is fully elected by late this year.However, ICANN officials are not happy and said they will suspend the fee approach pending recommendations of a new task force on funding options."Obviously, ICANN must have a stable source of income adequate to cover the costs of its technical coordination and consensus-based policy development functions," said Esther Dyson, interim chair of the ICANN board of directors."The United States government has asked ICANN to do an important job, but it has not provided the means by which to carry it out, leaving the job of providing funds to the Internet community itself," she said.ICANN, to date, has relied on voluntary donations, Dyson said, adding, "this is neither an equitable way to allocate the recovery of costs nor a means to assure stability over the long term." The Commerce Department also directed ICANN to open immediately its board meetings to the public."Transparency is critical to establishing trust in decision-making," Pincus said. "And trust is essential for ICANN's ultimate success."In response to the Commerce Department's direction on public board meetings, ICANN has decided to make public its board meeting in Santiago, Chile, in late August, Dyson said. And, following the Santiago meeting, nine elected board members will join the group.While it appears there is a consensus on some issues, the jury is still out on a number of issues on the future of ICANN.For example, James Rutt, chief executive officer of Network Solutions, told the subcommittee ICANN is off track and "interfering in matters that ought to be the subject of market competition among registries and registrars." "Despite widespread and continuing protests from the Internet community, ICANN has made its decisions in closed board meetings and has failed to engage on a deep and continuing basis with industry and stakeholders they purport to regulate," Rutt said. "Again, even in response to Department of Commerce recommendations, they have declined to open their next scheduled telephonic board meeting July 26 to observers or to commit to amendment of their bylaws to require open board meetings on a continuing basis," Rutt said.ICANN officials insist they are working diligently to meet the policy directive of the Clinton administration, and blasted back at critics for unfairly insinuating the organization is out of control."Because nothing like ICANN has ever been attempted before, its success is not assured. But because it seeks to embrace and build on the consensus tradition of the Internet, it has at least a chance to succeed," Dyson said.Dyson also said ICANN is not trying to put Network Solutions out of business."If the committee has been told that ICANN has the power to terminate Network Solutions' authority to register domain names, or has asserted that it does, the committee has been misinformed," Dyson said.