Comments of Network Solutions Inc.
In regards to the
Department Of Commerce
National Telecommunications and Information Administration
15 CFR Chapter XXIII
[Docket No. 980212036-8036-01]
Improvement of Technical Management
Of Internet Names and Addresses
23 March 1998
Network Solutions, Inc. (NSI) supports the framework for transition set forth in the proposal To Improve Technical Management of Internet Names and Addresses (the "Green Paper") because it addresses the needs of existing and new stakeholders in keeping with the Internetís growth from its academic beginnings into a major element of the global, competitive communications infrastructure.
The policies and procedures that govern the Internetís critical functions must permit the system to achieve "scale," and freely grow, offering benefits to users worldwide without cumbersome regulation. The current operation of the domain name registration system has demonstrated an ability to handle incredible growth. We must now ensure that the management of the root system (the "public trust" part of the system) also achieves the highest degree of operational rigor.
NSI supports the Green Paper proposal to add five new competitive domain name registries each initially with one new top-level domain (TLD) operating with "shared" registrars in addition to NSIís existing registry. However, NSI has serious concerns about the technical feasibility of the recent proposal by others that calls for "split" responsibility and authority for each TLD across multiple registries. Even if this development could be technically achieved at a future date, NSI would oppose it because it adds costs, complexity and customer confusion without providing meaningful consumer benefits. Competition among for-profit registries and registrars will provide the best consumer safeguards and result in more cost-efficient and higher quality services.
To facilitate the initial implementation of the non-profit company (hereinafter referred to as "NPC") proposed in the Green Paper to handle all Internet coordination functions, NSI recommends the creation of a U. S. government-appointed Transition Board. This Transition Board, rather than the Internet Assigned Numbers Authority (IANA), should perform a number of preliminary functions including setting the qualifications and processes for establishing the new registries.
NSI believes that a proactive U.S. government sponsored transition, assuring continued stability and a balanced outcome for all stakeholders, is both desirable and necessary. As an important stabilizing move, the U. S. government should publicly continue to assert its authority over the root server system, and move rapidly to improve its physical security and reliability, and ensure the uninterrupted operation of the Internet.
II. The Fundamental Issues
The Green Paper rests on four important principles which will: 1) assure stability throughout a transition period; 2) introduce greater competition, which allows more consumer choice and promotes private investment in new services; 3) transition securely to a private bottom-up coordinated structure; and 4) guarantee representation for all stakeholders and Internet users. Based on this foundation, the Green Paper attempts to deal with the following difficult questions that are fundamental to any solution:
1. How to establish a legitimate policy body representing users and stakeholders with the authority to administer the Internet critical infrastructure and competitive registration services?
2. What is the overall transition strategy, and how to construct and execute a detailed transition with specific schedules, ground-rules and milestones?
3. What are the policies and procedures that will allow the addition of new operationally secure domain name registries and new TLDs?
4. How to introduce new competitive registrars?
5. How to formulate pragmatic methods to minimize Internet conflicts and litigation resulting from trademark and other domain name contract disputes?
NSI provides the following comments on the questions that the Green Paper raises in the context of the four principles of stability, competition, coordination, and representation.
A. Legitimacy, Authority & Representation
The Green Paper proposes the establishment of NPC, a new, private, non-profit corporation, to manage the coordinated functions in a stable and open institutional framework. NPC would set policy and have authority over IP allocation and technical parameters, the root system, registries and TLDs.
NSI agrees that all functions, that can not be competitively provided, should be managed by NPC, and supports the proposed 15-member international board of directors drawn from the international community. However, several stakeholder communities, such as the registry/registrar community and the user community, are not yet well organized. Therefore, democratic selection of the NPC board may not be possible for some time. Accordingly, NSI proposes the creation of an initial Transition Board for the period prior to the establishment of NPC. The U. S. government should appoint members to this Board from among current Internet stakeholders representing both profit and non-profit entities. NSI proposes that the Transition Board for NPC contain one representative each from the Internet institutions identified below:
The Transition Board should perform a number of functions that will enable progress prior to the complete establishment of NPC such as:
As a recent example of such a transition board, NSI employed an appointed board for the American Registry for Internet Numbers (ARIN), a recently incorporated non-profit Internet corporation, which NSI helped establish for the Internet community. Selection of the initial board through a democratic process was impractical, and yet a board was required to move the effort forward in a legal and legitimate manner. The transition board has allowed NSI to complete its sponsorship of ARIN, relatively quickly and virtually without incident. All subsequent ARIN directors have been selected in accordance with the corporate bylaws.
Subsequent boards should be selected according to NPCís Bylaws and Articles of Incorporation and with due regard to all of the constituencies represented at the time. For example, the six authorized registries should have representation and the registrars should have representation based on the number of registrants.
NSI recommends that the role of establishing and qualifying new registries should be managed by the Transition Board. Questions of legitimacy and legality may disrupt the process otherwise.
B. Overall Transition Strategy
The Green Paper proposes a transition to commence as soon as possible starting with the operational transfer of responsibility of the functions now managed by the IANA, and the administration of the root zone system (now conducted by NSI under direction of NSF), to NPC by September 30, 1998. The U. S. government will participate in policy oversight to assure stability until NPC is established and stable, phasing out as soon as possible and in no event later than September 30, 2000. Further, the Green Paper calls for bilateral agreements between the U.S. government and both the IANA and NSI. NPCís charter must require that it fully ratify and abide by the NSI and IANA transition agreements, which are negotiated with the U.S. government. These agreements will not be subject to change without bilateral agreement of the parties.
It is clear from the Green Paper that major policy changes will be made prior to the establishment of NPC (i.e., September 30, 1998). NSI recommends that significant policy decisions should be delegated to the Transition Board, and that establishing it properly should be a primary objective.
The most critical operational issue facing the Internet today is the control, robustness and security of the root system. NSI received written instruction from NSF on October 2, 1997 to accept direction only from the NSF under the Cooperative Agreement relative to the management of the "A" root server. Some operators of the other root servers do not acknowledge the NSFís authority. Without clear authority and responsibility, the transition will be difficult to achieve and risk of operational failure will increase. NSI recommends that the U. S. government publicly assert its authority over the root zone system in the final version of the Green Paper.
Further, the lack of accountability, availability, and contractual obligation of the root server operators and the security of their systems needs to be changed now. NSI recommends that, through the Transition Board, the root server operators should be made accountable and legally liable, that they be required to meet clearly expressed minimum operational standards, and that they be compensated for their labors. The vulnerabilities that allow the Internet domain name software to be exploited must be removed. These software vulnerabilities remain, and now threaten the security of the Internet.
C. Competitive Domain Name Registries and New TLDs
The Green Paper proposes the addition of up to five new competitive domain name registries, each initially with one new TLD, with the possibility of additional TLDs after a period of evaluation. The first five entities to meet the technical, managerial and site requirements will be allowed to establish a domain name registry. The selected registries must operate on a "shared" basis, meaning that each registry must deal with all registrars identically.
NSI supports this proposal because it meets the Green Paperís four principles. NSI recommends that the procedures for selecting and qualifying the new registries be put in place at the earliest time.
NSI opposes a recent alternative proposal to split the responsibility and authority for each TLD among multiple registries. Because of the hierarchical structure of the Internet naming system, a single authoritative database is required for each TLD. A non-centralized authoritative zone distribution system creates the risk of name clashing between the registries or implies the existence of a sophisticated, real time reservation system which would take a great deal of time to develop, implement and adequately test. Even if a split registry approach could be achieved through some new technical development, it would bring little benefit to the consumer, yet it would introduce tremendous risk, complexity, cost and delay to this reform of the Internet. Competition between registrars and between competing registries managing TLDs will provide consumers with choice, greater selection of services and lower costs.
NSI opposes the Green Paper proposal that the registry and the registrar be separate subsidiaries. Both organizational and operational costs associated with separate subsidiaries will increase the baseline costs of registry operations to consumers. NSI recommends that the Green Paper be revised to require only corporate division, with adequate accounting, in order to separate the two functions and ensure confidentiality. Separate centers for cost allocation is the key feature that guarantees independence and autonomy.
The Green Paper proposes that domain name registries should be for-profit entities. Some oppose this, using a "public trust" argument. Others support it because competition among registries will provide safeguards. NSI suggests that the registry have the choice to select either form, for-profit or non-profit organization. NSI supports for-profit registries for the following reasons:
1) In this highly competitive environment a non-profit that is unable to offer stock options to key employees as part of the compensation package will suffer excessive turnover.
2) The design, construction and operation of a registry, that even minimally meets the requirements in Appendix 1 of the Green Paper, involves a significant investment of capital. Based on NSIís experience, this will be many millions of dollars. Corporations may be unwilling to proceed with registry development with no ability to recoup that investment through profits;
3) The operating registries will require additional infusions of capital to maintain their technical edge and upgrade operational capability over time; and
4) Competitive, for-profit registries are desirable. Typically, they are more efficient, and provide better services than institutionalized non-profit entities. The latter do not have the pressure from shareholders to minimize costs, attract customers, and to compete for profits.
D. Qualified Competitive Registrars
The Green Paper proposes that each TLD registry should be equally accessible to any qualified registrar, so that registrants may choose their registrar competitively on the basis of price and service. Any entity will be permitted to provide registrar services as long as it meets the basic technical, managerial, and site requirements in Appendix 1 of the Green Paper. Registrars will be allowed to register customers into any TLD for which the customer satisfies the eligibility rules, if any.
NSI supports this approach to competition in registration services. As promised, NSI is currently making the technical preparations to allow additional competitive registrars in the .COM, .NET and .ORG registries. These activities, which will be basis for discussions with the U. S. government, as specified in the Green Paper, include:
E. Conflicts (Trademark Disputes, Contract Disputes, Litigation)
The Green Paper proposes that a study should be undertaken on the effects of adding new TLDs on the existing international and national trademarks. This study should be conducted under the auspices of a body that is internationally recognized in the area of dispute resolution procedures related to trademarks. In the meantime, it proposes that each TLD registry must establish minimum dispute resolution and other procedures related to trademark considerations. Those minimum procedures are spelled out in Appendix 2 of the Green Paper. If desired, registries would be permitted to establish additional trademark protection and trademark-domain name resolution mechanisms.
NSI disagrees with the Green Paper proposal that registries resolve domain name disputes. NSI believes that the legal costs and responsibility for dispute policies should reside at the registrar rather than the registry level, since the registrar is the point of contact with the customers. Since registrars will likely be registering with multiple registries, this allows the registrar to have consistent customer practices. For this reason, the registrar, not the registry should be responsible for dispute management and should be the proper party to indemnify the registry and NPC for its actions. It follows that registrars should be able to demonstrate the financial capability to make any such indemnity viable as a condition of their initial and continuing qualification.
Adopting this approach solves most of the problems. However, if a registrar works with two registries in different countries, there is a potential conflict by virtue of differing applicable laws. To address questions of this sort, NSI supports the Green Paper recommendation for a study.
Providing "readily searchable" domain name databases has potentially negative implications with regard to privacy. Many of NSIís customers are asking for more privacy for their registration records, not less. This privacy trend flies in the face of the recommendation for public databases. NSI believes that the entire privacy issue is lurking in the background in relation to domain name data, and that this issue could become at least as difficult to deal with as the trademark issue. For this reason, NSI recommends that this topic should be included as a major topic in the dispute resolution study.
The Green Paper represents a reasonable approach to the problems facing the Internet today. NSI supports it, and regards it as a work-in-process. It will be shaped and refined in an ongoing process over the next two years in a deliberative fashion with broad representation from a wide user community. The Green Paper will serve as the road map. Studies, cooperation, and the best ideas drawn from the entire community will be required to solve many of the problems we now face.
It is of special importance that the new structures, policy bodies and procedures be able to manage the stress from business and consumer use of the Internet. Stability, both today and tomorrow, is necessary for the Internet to reach its full potential. The on-line commercial phenomenon, which the Internet has enabled, is in its infancy. We are confident that the Internetís development and growth will be different, more challenging, and greater than anyone can now envision.