[ga] Fw: [icann-delete] Proposal: Registry Re-circulation System
Ron asked me to pass this on to the Registrars list for the benefit of those
that aren't subscribed to the ICANN-Delete list. I've taken the liberty of
posting this additionally to GA and discuss-list - apologies to those that
receive all four copies.
----- Original Message -----
From: "Ron Wiener" <Ron@Snapnames.com>
To: "'Peter Girard'" <email@example.com>;
Sent: Monday, January 07, 2002 9:08 PM
Subject: RE: [icann-delete] Proposal: Registry Re-circulation System
> I enjoyed reading your proposal, and have admired the way you continue to
> carry the flag for a variable-priced auction mechanism. If you please, I
> have a couple of questions followed by a few general comments:
> 1. If you are requiring the permission of the former registrant in
> order for the auction to "close"...
> a. ...are you not then in effect alerting him or her to the fact that
> their name may have some value, and encouraging them to renew rather than
> allow the name to expire? This may be a brilliant scheme for goosing up
> renewal rates, but how does it help registrars and registries gain any
> upside that they would presumably only enjoy if the name actually changed
> b. Correct me if I'm mistaken, but the reason you NEED the current
> registrant's permission is that in order to circumvent the registry, you
> want to be able to use the XFER command instead of actually deleting the
> name. I suspect the IP constituency might have some serious heartburn
> this as it creates all sorts of liability problems when the creation date
> a domain name record is not reset upon a new registrant receiving the
> Using the XFER command in this way exposes the new registrant to potential
> litigation from the prior registrant who may claim the registrar did a
> job of tracking him down with a renewal notice "because they'd make a lot
> more money auctioning off my name than letting me renew it." The original
> transfer date matching his filed invoices could imply that the name is
> his since apparently it was never deleted.
> c. It's also not clear to me that registrars Terms & Conditions extend
> the current registrant's rights to the domain name past the actual
> expiration date and into the grace period. If this is the case that the
> current registrant's rights have already ended then the registrar would
> essentially be warehousing and speculating with this name during the grace
> period. Perhaps someone from ICANN or VGRS can clarify this for us. Dan
> 2. It seems to me that there is a distinction between the WLS (as
> proposed) and the RRS (as proposed), in that the WLS allows registrars to
> capture "backup demand" for any name throughout the entire year. The RRS
> only allows the capture of demand during a portion of the 45-day grace
> period window, which inherently means it would be primarily of interest
> and accessible to, speculators, not mainstream consumers.
> Mainstream customers are unlikely to happen to discover a need for a
> name during any particular 45-day period, learn how to search for it from
> about 1.5M names that would presumably be up for auction during such
> learn how the bidding mechanism works, dig in their pockets for a credit
> card to pay a $2 fee (smacks a bit too much of $2 .biz lottery fees -
> - bad memories!), and sit around to monitor the whole thing. Odds are 9:1
> that the discovered need for a name would happen sometime other than that
> 45-day window. (I'm simplifying this by assuming the average registration
> is about one year in term anyway.) The RRS proposal states that consumers
> would have "open, fair access to deleting domain names in an environment
> free from high-tech gaming and first-mover advantage" but the method
> described doesn't seem to meet this definition.
> Consumers are not likely to want to participate in an auction process
> can easily be gamed, much like eBay auctions often are, with shill bids.
> Witness the thick file at the FTC and the number of lawsuits that were
> generated. In fact, a savvy speculator could whip up a robotic algorithm
> outbid others milliseconds before auction close, or to pump fraudulent
> into the system using stolen credit card numbers - a problem already
> plaguing too many registrars and secondary name sites.
> Consumers are also not likely to wait anywhere from 1 to 344 days to then
> have to monitor an auction process, and then be prepared to spend an
> undefined amount of money to get the name. I can see speculators being
> willing to do this all day long - they're good at it - but mainstream
> consumers? For them I believe this type of mechanism would be deemed yet
> another "game of chance" with $2 betting fees, and could become a
> rod for litigation against registrars, ICANN, VeriSign, et al.
> may be just fine with the game of change (some seem to even thrive on it)
> but mainstream customers would be anything but enamored by the prospect of
> Further, while I fundamentally agree that variable-pricing makes a lot of
> sense in the long run, it's extraordinarily tricky getting it right when
> comes to domain names, and now doesn't seem the right time to implement
> an advanced marketplace concept. Witness the number of different models
> that have been tried and abandoned by some of the ccTLDs - a perfect one
> yet to be found. One concern from an FTC standpoint is that uninitiated
> domain name buyers might be goaded into paying unwarranted prices for
> names because of the heated action of an auction. This is where sites
> NameWinner are actually safer, because everyone there is at least a
> quasi-professional speculator and knows how to appraise the value of a
> If unwitting consumers are successfully drawn into an active bidding event
> for domain names, they could potentially be misled into paying exorbitant
> prices. One benefit of the flat pricing of the WLS structure is that it
> eliminates the possibility of this sort of complex and problematic
> experience. Again, you might ask the FTC how many such complaints they've
> received from eBay customers over this sort of thing.
> Finally, putting on my Wall Street hat for a moment, the RRS lacks two
> especially nice financial features of the WLS which is that it provides no
> forward visibility on certain revenues (i.e. if 60% of my registrants do
> renew next year I know that x% of the names in question would
> go to a wait listed customer) and no growth in deferred revenue, a key
> valuation driver. For public companies (there are currently six
> publicly-held registrars) this is particularly important, as it is for the
> valuation of any registrar that hopes to be acquired someday.
> Ron Wiener, Chairman and CEO
> SnapNames.com, Inc.
> 115 NW First Avenue, Third Floor
> Portland, OR 97209
> tel: 503-219-9990 x222
> cell: 503-502-5016
> fax: 503-274-9749
> <mailto:ronw@SnapNames.com> mailto:ronw@SnapNames.com
> <http://www.SnapNames.com> http://www.SnapNames.com
> -----Original Message-----
> From: Peter Girard [mailto:firstname.lastname@example.org]
> Sent: Monday, January 07, 2002 11:27 AM
> To: email@example.com
> Subject: [icann-delete] Proposal: Registry Re-circulation System
> With the help of several members of the registrar community, we have
> migrated our dynamically priced delete proposal to a registry-level
> in which the bulk of the revenue opportunity goes to the registrars. This
> system would be cheaper, fairer, more transparent, and better for Internet
> growth than earlier proposals. Perhaps most important, it would reward the
> sector of this industry (registrars) that faces market risks and creates
> I have attached a Word document. If this is problematic, I will happily
> provide an alternative format.
> Peter Girard, Afternic.com
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