March 23, 1998

VIA FACSIMILE

Mr. Ira Magaziner
Senior Advisor

Re: Comments on the U.S. Green Paper on Improvement of Technical Management of Internet Names and Addresses; Proposed Rule

Dear Mr. Magaziner:

I write on behalf of California SunCare,Inc., a California-based company, which is on of the 88 registrar participants in the Internet Council of Registrars ("CORE"), to comment on the draft copy of the Green Paper published in the Federal Register on February 20, 1988.

The Green Paper's ("GP") self-defined purpose is to privatize, increase competition in, and promote international participation in the domain name system. Notwithstanding its laudatory goals, the GP's proposal reflect a U.S.-centric and monopolistic slant. This bias is apparent in claims such as "the Internet is rabidly becoming an international medium for commerce, education and communication." The truth is the Internet is already such a medium. Until the U.S. Government and the GP recognize the worldwide character of the Internet and Internet-based commerce, they will be injuring the ability of both the U.S. and international companies to compete in the global marketplace.

The primary short-falling in the GP's efforts to increase competition and international participation in the Internet lies in its proposals regarding registries. The GP alleges that it is seeking to create a "fully shared registry basis" and then suggests granting Network Solutions, Inc. ("NSI") a monopoly in the .com, .net and .org generic top level domain names, and five other companies monopolies in five yet to be created gTLDs.

The GP properly notes that "competition among registries would allow registrants to choose among TLDs rather than face a single option." This statement is ironic in that under the GP's proposal there will be NO COMPETITION among registries as distribution of each available gTLD will be exclusive to a particular entity.

The GP, itself, recognizes that its proposal creates a lack of portability among registries which could result in switching costs and lock-ins. It discards such a concern, however, by noting that "market mechanisms may well discourage this type of behavior." California SunCare is concerned that the power of granted monopolies will, by definition, destroy such "market mechanisms."

California SunCare is also concerned that the monopoly in registries could result in monopolies in registrars as well. Because NSI (and presumably the other registries) will also be registrars, there will be a strong incentive to discriminate between registrars. The GP claims that NSI will treat all registrars on a "nondiscriminatory basis." It fails, however, to offer any explanation as to who will police the registries, or whether such policing is even possible.

That the GP's proposal regarding registries are flawed should come as no surprise as they are based on the erroneous assumptions that the Internet is not stable enough to handle a large number of new gTLDs and/or real competition among registries. John Postel and other technical experts have demonstrated that the contrary is in fact true.

It is California SunCare's understanding that a motivating factor behind the GP is the need to break NSI's U.S. Government-given monopoly over the issuance of domain names. It begs reason to call the granting of similar but smaller monopolies to five other entities a solution. The GP claims that "this proposal is designed only for the transition period." However, once the "transition period" is over, the five new registries will be as permanently entrenched in the registry business as NSI is today. The U.S. Government will then be faced with the problem of breaking not just one but five monopolistic strongholds over gTLDs.

Finally, despite its intentions for international participation in the domain name system, the GP fails to even address the existence of CORE, and international-based organization whose backers include the Policy Oversight Committee (POC), the Internet Engineering Task Force (IETF) as well as numerous international governments and businesses who signed the Generic Top Level Domain Memo of Understanding (gTLD-MoU) in support of the foundation of CORE and its role in the domain name system.

The time to privatize, increase competition in, and promote international participation in the domain name system is NOW. GP's tepid and multi-tiered approach in doing so hurts both U.S. and international interests. The marketplace is already global. The U.S. Government should not stand in the way of U.S. companies interested in competing it.

Sincerely,
Linh Tang
Scott D. Freeman
Yvonne Seijkens
Mischeila Haupt
Joel Zucker
Sonya Grigoruk
R.L. Mull
G. Andrew Jones
Laura Barnoski
Philip Waddilove

California SunCare