[registrars] Registrars Questions for VGRS Regarding the revised WLS proposal

[Rick H Wesson <wessorh@ar.com>]

Chuck,

Please find attached .PS and .PDF files which contains lists of questions
the Registrars would like answered as requested in your amended proposal
dated January 28, 2002.Please use the following address as a point of
contact for our group: execs@registrars.dnso.org which we will forward to
the Registrars list.

A text copy of the attached document is below for easy cut/paste in e-mail
discussions.

Regards,

-rick

Rick Wesson
CTO, Registrars constituency




   February 8, 2002


   To Chuck Gomes,


   The Registrar Constituency (RC) is hereby responding to the VeriSign
   Global Registry Services (VGRS) regarding its revised proposal to
   manage a Wait Listing Service (WLS), the subscription service for
   deleted domain names.  After issuing its original WLS proposal on
   December 30, 2001, VGRS issued a revised proposal on January 29,
   2002.  VGRS allowed ICANN constituencies and other interested parties
   to submit comments and questions regarding the revised WLS.


   Having opposed the original WLS proposal (see January 18, 2002 RC
   letter to VRSN) and considered the revised proposal, the RC remains
   significantly concerned with this proposal.  Therefore, the RC opposes
   the revised WLS proposal in its current form.  Following are the RC's
   key concerns regarding the WLS, which focus on price and transparency:



   a) We continue to view the proposed $35.00 price point for WLS
      (which is in addition to the $6.00 registry fee) as exorbitant,
      even with the potential proposed rebate program.  VGRS has never
      justified its price point with cost requirements.  The fact that
      VGRS easily lowered its original price begs the question of what
      costs actually justify the proposed WLS price.


      As we had previously stated, the WLS would significantly raise
      the price point for the end consumer, effectively undermining
      competitive registrars' financial wherewithal.  It is highly
      unlikely that registrars would be able to increase their margins
      in proportion to the increased margin charged by VGRS.  In
      contrast, competitive registrars would have to dramatically
      lower, or eliminate, their current margins in order to compete
      for WLS names.  This would undermine competitive registrars'
      revenues and jeopardize their ability to remain profitable.


      The one registrar that may be able to take effectively advantage
      of this price is the VeriSign registrar, which continues to
      enjoy the largest market share. It would be able to use the new
      higher margin to price below wholesale, as it has in the past
      with the $6.00 fee.  The result is to unfairly undermine
      competitor registrars.


   b) The additional concern that continues to exist with the revised
      WLS proposal is regarding the lack of transparency if VGRS runs
      the primary registry, the largest registrar, and the
      subscription service.  As long as the same company is operating
      this vertically powerful chain of companies, it may be possible
      for it to shift domain names from the $6.00 registry to the
      $41.00 WLS.  In fact, only the registry would know all of the
      WLS subscriptions and the timing for deleting names.  Such
      information could be abused by its registrar.  Considering that
      there is a history - some of it still unresolved - of VeriSign
      not deleting expired names, the RC is doubly concerned that
      VGRS' operating the WLS provides new opportunities for domain
      name hoarding.


   c) An additional inherent unfairness is the ability of the largest
      registrar to "game" the WLS system.  Since VeriSign's registrars
      delete over 50% of domain names, they can offer (to potential
      WLS subscribers) a WLS subscription on its customers' names that
      only VeriSign knows are to be deleted.  Other registrars'
      customers would be buying a WLS name without the benefit of
      knowing that a particular name will actually be deleted.  The
      current system does not provide registrars an advantage based
      its size.  With the WLS system what is to prevent a registrar
      extending its advantage over the other registrars by not
      deleting the names that have expired without renewal and thereby
      offering less risky WLS subscriptions on those names compared to
      the other registrars?


   In terms of the RC's questions, they are as follows:

   a) What are the costs that justify the WLS price? What is the
   intellectual property that SnapNames is providing?

   b) The introduction to the VGRS' "Justification" document states
   that the WLS "is not a solution for the deleted names issue."  If
   the WLS system does not solve the batch pool problem (per VGRS
   explanation), why should it be adopted?

   c) What is the phase in procedure (ie: landrush)?

       a.  The SnapNames Parallel Registries Proposal (Sept 21, 2001)
       identifies 25,000 deletions/day. This means that the annual
       demand on deleted names is roughly 4.5 million.  It is very
       likely that there will be a landrush. Since VGRS could not
       handle the load of 160,000 domain release back in Aug ust 2001
       (which led us to today's condition), how will it deal with a
       WLS landrush?

       b.  There will be competition amongst speculators to be the
       first to get the WLS on the best names about to be deleted,
       which may extend the landrush effect.

   d) What is the proposed length of the trial?

       a.  Page 8, Paragraph g of the proposal states, "Subscriptions
       continuing beyond the end of the trial period would continue to
       be serviced by VGRS and registrars."  Thus, the trial period
       lasts for two years, not one.

   e) How many expired names does VGRS Registrar have that have not
   been deleted?  When will they be deleted?  Will these names be
   deleted before the start of the WLS?

   f) Pages five and six of the proposal discuss registration data to
   be submitted to the WLS, which suggest potential added data.  Would
   any data in addition to the current Whois information be required?

   g) The proposal allows registrars to delete a domain with full
   refund if it is less than 120 hours old.  Is there a grace period
   for deletion (cancellation) of a WLS subscription, which will
   refund the fee?

   h) How would VGRS handle "charge-backs" for subscriptions?

   i) What are the criteria for a evaluation of a successful testbed?

      a.  These should be specified prior to launch.

      b.  Do those criteria take into account the existing competitive
      landscape?  What are market measurements to serve as the basis
      for a comparison?

      c.  Under what metrics will the WLS test be considered a
      failure?

   j) What are the technical impacts of the protocol (epp) ?

   k) Does the WLS proposal expose current registrars of record to
   different and/or additional risks than other registrars?
   Alternatively, do registrars of record have any advantage over
   other registrars?

   l) Many have requested an opt-out capability.  Does the protocol
   used for registering a WLS subscription have this capability, if
   not why could this not be added?

   m) Registrars have requested several improvements and fixes of
   registry operations in order to address problems that are impeding
   registrations.  When will the Registry fix these issues and why has
   the WLS taken precedent above fixing these issues?

   n) Why has VGRS not implemented batch deletions in several weeks?

   o) Has VGRS investigated the antitrust, auction law and commodity
   futures law implications of WLS?  If it is deemed to be illegal or
   raise civil law implications, will VGRS indemnify affected
   registrars, resellers, registrants and other market participants?
   Does VGRS offer any assurances from legal staff that the WLS
   product is legal?

   p) Will VGRS release the actual proposed service agreement for
   comments at some point before a decision to deploy the WLS is made?

   q) Will VGRS release criteria for what constitutes an acceptable
   education program for the WLS service?

   r) Have financial projections been created for the WLS, for both
   the registry and the registrars? If so, we would like to see them.

   s) When will technical and operational documents of the WLS be made
   available?


   While the RC continues to oppose the WLS in its current form, it
   recognizes the need for a permanent solution to the apparent
   problem of deleted names not being released or being released in a
   manner that undermines other registry functions.  Therefore, the RC
   welcomes the Names Council's consideration of alternate ideas for
   addressing these issues, many of which have been discussed by the
   RC.


   Regards,


   Rick Wesson
   Registrar Constituency
   Chief Technical Officer


   cc:  Louis Touton
        Dan Halloran
        Names Council

RC-WLS-comments-2.pdf

RC-WLS-comments-2.ps