"Should auctions determine who controls the rights to oversee the Internet addressing system?" asks Jennifer L. Schenker in the International Herald Tribune. "The Internet Corporation for Assigned Names and Numbers, or Icann, a not-for-profit organization that acts as gatekeeper for the Net's addresses, will attempt to grapple with that question at a week-long meeting in Kuala Lumpur that begins Saturday [19-23 July]. Some academics who closely monitor Icann have been pushing for auctions as a fairer way to determine who should control so-called generic top level domains like .com or .net that help users find their way around the Internet.
"On Tuesday, the Paris-based Organization for Economic Cooperation and Development gave its endorsement for auctions, increasing the chances, some say, that this solution will be chosen over subjective choices based on merit, as is the current system. 'We have come down on the side of auctions, and I think most economists would agree because they are more transparent and verifiable,' said Sam Paltridge, an OECD economist. 'There is less risk of decisions being challenged in court and less risk of favoritism'...
"Icann has pledged to come up with a new policy using 'straightforward, transparent and objective procedures' by Sept. 30 and to put a new plan into action before the end of the year. It asked the OECD for its input as part of that process...`Icann is also awaiting recommendations from the World Intellectual Property Organization and from technical experts...
"If Icann adopts an auction-based selection process, the first to feel the impact is likely to be VeriSign, which has a contract to oversee the two most successful commercial top-level domains, .net and .com, reaping an estimated $180 million in revenue annually from the $6 fee it charges a year for each of the approximately 30 million registered names under its control. The current agreement between Icann and VeriSign on the .net domain expires next June. Once the contract expires, the OECD's report says, 'there seem to be few, if any obstacles, to Icann auctioning the right to be the registry responsible for .net. An auction would provide a transparent and verifiable mechanism for the market to value .net appropriately and avoid the pitfalls associated with comparative selection....'
The OECD is recommending that auctions take place only after a pre-qualification process, which would ensure the financial viability and technical expertise of candidates. Although it is not the goal, auctions also might bring in extra money for Icann, depending on what companies bid, Paltridge, of the OECD, said. At the Kuala Lumpur meeting, Icann is expected to double its budget, to $15.8 million from $8.6 million, by raising the rates it charges registries and registrars. Fears that only applicants with the most money would win in auctions can be offset by setting up a process in which not-for-profit generic top-level domains would be awarded in a lottery process, said Mueller of the University of Syracuse."
Meanwhile, the Center for Democracy and Technology has issued a new report on ICANN and Internet Governance: Getting Back to Basics: "The report calls on ICANN to focus on its limited mission and bottom-up, consensus-based approach, which remains the best model for managing core Internet naming and numbering functions. Karl Auerbach presents a well-written critique of the report in his CaveBear blog.
The schedule and agenda for next week's ICANN meeting in Kuala Lumpur can be found here. Several attendees have promised to report from the meeting in their respective blogs - e.g., Ross Rader and Susan Crawford.