LSE report released: Another ICANN reform?

The London School of Economics Public Policy Group finally released its long-awaited assessment of the GNSO, ICANN's representative organ for making global domain names policy. The impartial X-ray the LSE group administered on the GNSO is, on the whole, excellent as an analysis of how things are. Many of the recommendations are good, too. But on the most critical issue of all * the distribution of voting power among GNSO constituencies * the LSE has put forward recommendations that cause serious concern.

In essence, the LSE report suggests that GNSO be restructured into three basic groupings: the registration supply industry, business interests, and civil society. This is, as the report suggests, a cleaner and more flexible division of the world than now exists. It recommends repackaging participation in DNS policy as being a member of ICANN, not of the GNSO, which the public has never heard of. The GNSO Council would be reduced in size to 16 from its present 21. The report tells ICANN to financially support the participation of the members of this smaller Council. These proposals are sensible; one could even say that they are a breath of fresh air into a coagulated system.

But the report proposes that registration suppliers and business users be given 5 votes on the policy making Council, while civil society * the only voice for the general public * be given only 3. It also proposes to raise the threshold for a “consensus policy” to 75% of the vote. This means that supplier interests and business interests could, if only 4 of their representatives agreed, prevent a 75% majority from forming and thus block any policy. The public interest advocates in civil society, even if they were completely unified, could not exercise such a veto. The existence of three “at large” GNSO Council members appointed by the Nominating Committee compensates for this inequality to some degree. But the NomCom-appointed Council members can come from any constituency; the NomCom contains diverse interests and is not guaranteed to appoint members sympathetic to civil society.

It is reasonable that the registration industry, whose survival depends entirely on ICANN contracts and policies, have some kind of special status in the outcome of policies. They need to be protected against various forms of crippling regulation or expropriation at the hands of GNSO Council legislators who do not have to directly bear the costs of their policies. But there is no legitimate reason why business users should be given the same veto power and civil society groups denied it. Nothing in the factual findings of the report justifies this discrimination. The report does not even mount an argument for it.

The report pretends to criticize weighted voted for registries and registrars in the current system. But the LSE proposals do not eliminate weighted voting. They simply redistribute the weighting. Giving 5 votes to one sector and 3 to another is weighted voting. As I show below, the net beneficiaries of the redistribution are the business interests. The net losers are registries and registrars. For civil society, which previously had only 3 votes out of a total of 21, the overall result is basically a wash, or perhaps a slight gain. Under the current GNSO structure public interest advocates have 14% of the votes; the LSE proposal would increase its share of overall votes to 19%. Funding participation would also be a boon.

But the results could be worse than a mere running of the numbers suggests. For the new “registration” industry constituency would be composed of both registries and registrars. Anyone who knows the politics and economics of the domain name industry knows that those two interest groups are often in disagreement. Frequently their fundamental economic interests are in conflict. Just look at the VeriSign settlement, for example. If these two groups are put in the same room and forced to elect five representatives it will be interesting to see the results. In some respects, requiring them to work together could be quite healthy.

A consolidated business constituency, on the other hand, is likely to be completely homogeneous, dominated by western multinational corporations and their global associations such as ICC and WITSA. Their main if not exclusive concern will be trademark and other static, protectionist concerns. Consolidating those constituencies won't change much of anything, because they are already consolidated! (Indeed, one of the loveliest aspects of the report is its documentation of the uniformity and narrow level of participation of the three business user constituencies.) So the proposed new GNSO structure would effectively give the AT&Ts, Disneys and International Chamber of Commerce's an effective veto on anything the GNSO did, while the relative power of the supply industry would be greatly decreased.

Did the LSE people really intend this, or did they get influenced by some behind-the scenes arm-twisting by certain vocal business advocates or ICANN staff or board members? One can only speculate.

The fundamental flaw in this proposal is the idea of raising the consensus policy threshold. It is surprising that the professional political scientists at LSE would buy into the notion that domain name policies affecting the distribution of millions of dollars of costs and benefits can be set by “consensus” rather than workable political majorities or reasonable supermajorities. ICANN is not IETF. In technical standardization, the overriding benefits of a standard give everyone an incentive to agree; in most domain name policy decisions there is no such incentive. The Federal Communications Commission does not wait for consensus or even a supermajority to emerge when it regulates. And the view that ICANN is not a regulator is not a view that anyone with knowledge of the system can hold anymore.

The report documents at length the inordinate amount of time it takes the GNSO to come to a conclusion. The cause of this problem is simple: GNSO is composed of interest groups which have no incentive to come to an agreement. This problem would be dramatically worsened by raising the threshold for agreement.

When it comes to analysis of how the GNSO works now, this report has some real gems. GNSO is really the only “bottom up” policy making process in the ICANN structure. Yet the report documents the incredibly small amount of attention paid to GNSO by the ICANN Board, and shows that there are few institutionalized channels for communication between the Board and GNSO. The visibility of the GNSO to the public, the report shows, is abysmally low.

The report's researchers wrestled their way through the tangled skein of WHOIS task forces in order to calculate the number of hours spent, and estimated the cost at $7 million in person-hours. As someone who has contributed greatly to this donation to ICANN's budget I appreciate the quantification. And it is about time someone talked about rational document management in the context of ICANN's policy making processes.

There are some indications that key ICANN decision makers had access to the report before others, and thus that its recommendations are not simply those of an impartial outsider but were vetted to conform to a direction in which certain people want to go. This is speculation of course. But it is speculation from someone with 8 years of experience in the way ICANN operates.

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