Third Status Report Under ICANN/US Government Memorandum of Understanding

(3 July 2001)


THIRD STATUS REPORT TO THE DEPARTMENT OF COMMERCE

July 3, 2001


On June 5, 1998, the United States Government published its Statement of Policy, Management of Internet Names and Addresses, 63 Fed. Reg. 31741(1998) (commonly known as the "White Paper"), declaring its policy to transfer responsibility for functions involving the technical management of the Internet from the U.S. Government and its contractors to a private-sector, globally representative, non-profit, consensus-based organization. On November 25, 1998, the United States Department of Commerce ("DOC") and the Internet Corporation for Assigned Names and Numbers ("ICANN") entered a Memorandum of Understanding ("MOU") formally recognizing ICANN as that organization and establishing a joint project under which ICANN and DOC agreed to design, develop, and test the mechanisms, methods, and procedures that should be in place and the steps necessary to transfer the U.S. Government's technical management responsibilities to ICANN.

The MOU originally provided for the joint project to run for approximately twenty-two months, through September 30, 2000. ICANN provided an initial status report to DOC on June 15, 1999; that report can be found at http://www.icann.org/general/statusreport-15june99.htm. It provided a Second Status Report to DOC on June 30, 2000; that report can be found at http://www.icann.org/general/statusreport-30jun00.htm.

Following the receipt of the Second Status Report and consultations with the DOC, the MOU was amended to extend its term to September 30, 2001, and to adjust the provisions to reflect work that had already been completed. This report describes the progress under the Amended MOU since that time, and identifies the tasks remaining to be completed.

A. General Description of Project

The MOU provides that "the Parties will jointly design, develop, and test the mechanisms, methods, and procedures that should be in place and the steps necessary to transition management responsibility for DNS functions now performed by, or on behalf of, the U.S. Government to a private-sector not-for-profit entity." The mechanisms, methods, and procedures developed were intended to "achieve the transition without disrupting the functional operation of the Internet." Upon successful testing, the MOU stated "management of the DNS will be transitioned to the mechanisms, methods, and procedures designed and developed in the DNS Project."

The general scope of the project was defined as follows:

"In the DNS Project, the parties will jointly design, develop, and test the mechanisms, methods, and procedures to carry out the following DNS management functions:

a. Establishment of policy for and direction of the allocation of IP number blocks;

b. Oversight of the operation of the authoritative root server system;

c. Oversight of the policy for determining the circumstances under which new top level domains would be added to the root system;

d. Coordination of the assignment of other Internet technical parameters as needed to maintain universal connectivity on the Internet; and

e. Other activities necessary to coordinate the specified DNS management functions, as agreed by the Parties."

B. ICANN's Progress Toward Completion of Specified Tasks

The MOU originally set forth nine specific tasks to which ICANN committed its resources as part of the joint project for the design, development, and testing of the mechanisms for post-transition private-sector technical management of the Internet. (It also provided, as a tenth task, that ICANN collaborate with DOC on other activities as appropriate to achieve the purposes of the joint project, as agreed by the parties.)

Because the mechanisms in several of these tasks had been fully designed, developed, and tested, and were successfully operating to permit private-sector technical management, Amendment 2 of the MOU replaced the original list of tasks with a revised list. The following sets forth the MOU's description of the revised list of seven specific tasks and describes the progress made to date toward completion of that task:

Task 1: Continue to provide expertise and advice on private sector functions related to technical management of the DNS.

Status of progress on task 1: While this is a continuing effort, the basic task is largely completed, and is certainly functioning effectively today. In 1999, ICANN entered into memoranda of understanding with both the Regional Address Registries (RIRs) (to form the Address Supporting Organization (ASO)) and various Internet standards development organizations (to form the Protocol Supporting Organization (PSO)). These memoranda of understanding establish the ASO and the PSO as the bodies primarily responsible for formulating address and protocol policy recommendations within the ICANN process.

In addition, in 2000, ICANN and the Internet Engineering Task Force (IETF) (which is one of the PSO constituency organizations) entered a Memorandum of Understanding Concerning the Technical Work of the Internet Assigned Numbers Authority, under which the IETF appointed ICANN to perform the protocol-parameter assignment functions (the IANA functions) arising from the technical Internet standards developed by the IETF.

Since their formation, the ASO and PSO have each been responsible for providing, through broadbased procedures set forth by each body, three members of ICANN's Board of Directors.

Thus, ICANN has established stable relationships with the both the Internet standards development organizations and the regional address registries. These relationships allow those organizations to continue their technical work in their respective areas of activity, while bringing them together within the ICANN process to formulate policies that span the areas of activity of multiple organizations.

Currently, ICANN is working closely with the ASO and its members, and with the organizers of proposed new regional address registries in Latin America and Africa, to facilitate the creation of these new registries, which will increase the efficiency of address allocation in those areas.

This task is essentially completed.

Task 2: Work collaboratively on a global and local level to pursue formal legal agreements with the Regional Address Registries (RIRs) to achieve stable relationships that allow them to continue their technical work, while incorporating their policy-making activities into the ICANN process.

Status of progress on task 2: Work continues on this task. The existing ASO memorandum of understanding was amended in October 2000 to make adjustments to the selection process for Address Council members based on experience. Other than this minor adjustment, the ASO has been performing well.

There has been a continuing dialogue between ICANN and the RIRs on supplementing the ASO memorandum of understanding with relationship agreements between ICANN and the individual RIRs. Dialogue continues and progress has been made. The next meeting on this subject is scheduled for late July, in conjunction with a Board meeting of ARIN, one of the three existing RIRs. The number of complex issues to be resolved has been narrowed to just a few. Delay in consummating the agreements implies that the RIRs have not yet made their planned financial support to ICANN, but the amounts contemplated are being held in reserve by the RIRs pending final agreement. In any event, the financial contribution contemplated from the RIRs as a group is a sufficiently small portion of ICANN's overall costs that its absence to date has not had a material effect on ICANN's ability to carry out its responsibilities under this MOU. Any new RIRs will begin operation pursuant to agreements with ICANN.

This task should be completed in the near future. If for some reason it is not, consideration should be given to whether additional agreements with the RIRs are in fact necessary to the effective functioning of ICANN, especially given the existence and effectiveness of the ASO operating under the existing memorandum of understanding between the RIRs and ICANN.

Task 3: Continue to develop and test the ICANN Independent Review process to address claims by members of the Internet community that they have been adversely affected by decisions in conflict with ICANN's by-laws or contractual obligations. Report on ICANN's experience with the fully implemented reconsideration process and independent review process.

Status of progress on task 3: ICANN's bylaws provide for the establishment of an independent review process by which contested actions of the ICANN Board may be subjected to independent third-party review. At its meeting in Cairo, Egypt on March 10, 2000, the ICANN Board adopted an Independent Review Policy that will result in formation of a nine-member Independent Review Panel. The members of the Independent Review Panel are to be nominated by the Independent Review Panel Nominating Committee (IRP Nominating Committee) and are subject to confirmation by a vote of the ICANN Board.

Under the policy, the IRP Nominating Committee consists of six members appointed by ICANN's Supporting Organizations. The members are appointed to three-year terms, except half the initial members are appointed to two-year terms. The members of the IRP Nominating Committee serve as volunteers and are not compensated. The IRP Nominating Committee is convened when the ICANN Board notifies it that a vacancy exists on the Independent Review Panel.

In April 2001, the appointment of the six initial members of the IRP Nominating Committee was completed by the Supporting Organizations, and on May 7, 2001 the ICANN Board directed the ICANN Secretary to notify the IRP Nominating Committee that the initial nine vacancies on the Independent Review Panel should be filled. That notification was made on May 22, 2001.

Under Section 5.9 of the Independent Review Policy, the IRP Nominating Committee ordinarily has 45 days after the notification of a vacancy to forward its nomination to the Board. In its resolution [01.51], the ICANN Board provided that, because the IRP Nominating Committee would convene for the first time and would be searching for nine qualified nominees, the committee should forward its nominations to the Board within 90 days after the Secretary's notification. Accordingly, the committee is scheduled to provide its nominations for the IRP to the ICANN Board no later than August 20, 2001.

On June 26, 2001, the IRP Nominating Committee published an open call to the Internet community for potential nominees. The open call period will close on July 26, 2001.

Thus, this task is well underway, and should be fully implemented within a few months.

Of course, in addition to the Independent Review Policy, ICANN already has in existence a reconsideration policy, under which members of the ICANN community affected by actions of the ICANN staff or Board can seek reconsideration of those actions by the Board. Also, many of the contracts and other agreements with domain name registries and registrars contain provisions paralleling protections in ICANN's bylaws concerning open and transparent policymaking, fostering of competition, and prohibitions against arbitrary or unjustifiable action. They also typically include arbitration provisions, which give the parties contracting with ICANN access to a neutral decisionmaker to resolve questions under these provisions.

Task 4: Collaborate with the Department to continue to complete development of a proposed enhanced architecture for root server security, and the development of the following documentation to be used in connection with testing and implementation of the enhanced root-server system architecture:

a. A written description of the enhanced architecture incorporating a dedicated primary root server;

b. A procedural plan for transition to the enhanced architecture;

c. An implementation schedule for transition to the enhanced architecture;

d. Documentation of IANA procedures for root zone editing, root zone generation, and root zone WHOIS service; and

e. An agreement between ICANN and root-server operators that formalizes stable, secure, and professional operation of the root-servers in accordance with the enhanced architecture.

Status of progress on task 4: ICANN's Root Server System Advisory Committee (RSSAC) was formed in 1999. Since that time, the committee -- which is composed of the operators of all thirteen DNS root servers as well as DNS and network topology technical experts -- has been working to complete this task.

The current status of this effort is reflected in the RSSAC report at ICANN's most recent meeting, which can be found at http://cyber.law.harvard.edu/icann/stockholm/archive/murai-rssac.html. Those portions of this task set out in a-c above are essentially completed and the technical detail required by d above is well underway; final documentation should be forthcoming within the next few months. There is conceptual agreement on the form of an undertaking between ICANN and the root server operators, and those may well be completed this summer. Upon the completion of these tasks, the Committee will report to the ICANN Board, and the Board will take the appropriate actions to complete this specific task, including the implementation of various steps designed to improve root server security and the establishment of a dedicated master server to maintain the authoritative root zone files.

Task 5: Following Department of Commerce review and approval of the documentation listed in paragraph 4 above, ICANN shall test and implement the enhanced root-server system architecture, including ICANN's operation of the authoritative root, under appropriate terms and conditions.

Status of progress on task 5: The implementation of this task will follow the completion of task 4.

Task 6: ICANN will continue its efforts to achieve stable agreements with the organizations operating country-code top level domains that cover the delegation and redelegation issues; allocation of global and local policy-formulation responsibility; and the relationships among ccTLD operators and the relevant government or public authority.

Status of progress on task 6: These discussions have continued with representatives of the ccTLD community. The requirements for the forms of agreements have been better identified, and this should lead to the formalization of some agreements in the near future. In addition, ICANN has begun discussions with individual ccTLDs that seem likely to lead to agreements in the next few months. At the most recent ICANN public meeting, ICANN's CEO committed to developing the capacity to complete at least five such agreements per month. The recent hiring of a Counsel for International Affairs and a ccTLD Liaison are significant steps in this direction.

Thus, efforts to complete this task are ongoing, with significant progress expected in the coming months.

Task 7: ICANN will continue the process of implementing new TLDs including proceeding with a proof of concept or testbed period and continuing design, development, and testing to determine future policy and action, continuing to consider:

a. The potential impact of new TLDs on the Internet root server system and Internet stability.

b. The creation and implementation of minimum criteria for new and existing TLD registries.

c. Potential consumer benefits/costs associated with establishing a competitive environment for TLD registries.

d. Recommendations regarding trademark/domain name policies set forth in the Statement of Policy; recommendations made by the World Intellectual Property Organization (WIPO) and recommendations made by other independent organizations concerning trademark/domain name issues.

Status of progress on task 7: Implementation of this task is well under way.

For nearly the entire time since it was formed, ICANN has devoted a significant part of its activities to the consideration of the establishment of new generic TLDs. At the ICANN meeting in Berlin in May 1999, ICANN's Board referred the issue of new TLDs to the (then newly formed) Domain Name Supporting Organization (DNSO). In response to this referral, in June 1999 the DNSO Names Council (which manages the process for development of policy recommendations within the DNSO) created a group, known as Working Group C, to study the issues raised by the introduction of new TLDs. After nine months of extensive discussions and review of several position papers, Working Group C submitted its report to the DNSO Names Council on March 21, 2000, recommending introduction of a limited number of TLDs, and posted the report for public comment. Public comments were solicited and received through ICANN's web-based comment forum and via e-mail to the dnso.org site.

The Names Council discussed the report and comments at a telephone conference held on April 18, 2000. At that meeting, the Names Council adopted the following statement, by a vote of 16-0 (two members were absent):

The Names Council therefore recommends to the ICANN Board that it establish a policy for the introduction of new gTLDs in a measured and responsible manner, giving due regard in the implementation of that policy to (a) promoting orderly registration of names during the initial phases; (b) minimizing the use of gTLDs to carry out infringements of intellectual property rights; and (c) recognizing the need for ensuring user confidence in the technical operation of the new TLD and the DNS as a whole.

The DNSO recommendation continued:

We recommend to the Board that a limited number of new top-level domains be introduced initially and that the future introduction of additional top-level domains be done only after careful evaluation of the initial introduction.

On July 16, 2000, after considering well over 1000 public comments, the ICANN Board adopted the DNSO recommendations and authorized the ICANN President to formally call for proposals to operate or sponsor new TLDs.

On 15 August 2000, ICANN posted a public call for applications on its web site and broadly announced the availability of the application materials. At the same time, ICANN published detailed criteria for the consideration any applications received. In response to the call, forty-four completed applications were received.

Once these applications were submitted, they were posted on ICANN's web site for public comment. Over 4000 comments were received; all appeared on ICANN's web site. ICANN also assembled a team of technical, financial, and legal experts to review and evaluate the applications, which issued a 326-page evaluation report on the applications. Additional public comments were received on this report, both on a web-based forum established by ICANN for this purpose (over 1000 comments received) and at an all-day public forum held in Marina del Rey, California, USA on 15 November 2000.

The introduction of new TLDs was the principal issue addressed at ICANN's annual meeting in November 2000. Leading up to that meeting, the Internet community had spent several weeks reviewing the applications and the detailed evaluation report, engaged in a robust dialogue on ICANN's web-based public forums (with a total of over 5000 postings), and intensely discussed the issues through ICANN's constituency and supporting organization structures. After extensive study of the materials in advance of the meeting and participation in the all-day public forum, the ICANN Board discussed the applications in a several-hour open session on 16 November 2000. As a result of this review, seven proposals to operate or sponsor TLDs were selected for an initial introduction of TLDs, as recommended by the DNSO.

In late 2000, ICANN and the proponents of the selected proposals began negotiations for appropriate agreements under which those TLDs could be introduced while preserving the stability of the DNS. Draft agreements for the new .biz and .info TLDs were posted on ICANN's web site in advance of the March 2001 ICANN meeting in Melbourne, Australia, and a public comment period was held at the ICANN Public Forum held on March 12, 2001. After additional adjustments based on the comments received, the agreements were posted for final review in late April 2001. They were then formally approved by the ICANN Board and they were signed on May 11, 2001. The full texts of both the .biz Registry Agreement and the .info Registry Agreement, with all their appendices, are posted on the ICANN web site.

The contracts have been designed to ensure that these TLDs are introduced in a sound manner that will maintain stable and reliable technical operation of the DNS. In particular, the contracts recite functional and performance specifications, data escrow requirements, and a detailed start-up plan that are designed to ensure that stable operation of the DNS is maintained, both during the startup phase and in the long term. User awareness is also relevant to smooth operation of the DNS; experience has shown that some level of confusion accompanies almost any change in the DNS. The operators of .biz and .info, however, have committed to information-dissemination measures that should keep any public confusion to a minimum.

Registration activities for .biz have commenced already and registration in .info will commence later this month. For both TLDs, DNS resolution of the names that are registered will begin in September 2001. To assist in a stable introduction with the public awareness needed to minimize confusion, ICANN has agreed with Afilias and with NeuLevel that the .info and .biz top-level domains should be established in the DNS for testing and evaluation purposes. Initially, the nameservice for the domains will be operated by ICANN, which will conduct various testing procedures and then, according to schedules and procedures developed jointly with Afilias and NeuLevel, transfer the nameservice to servers operated by those companies in time for the September 2001 onset of regular resolution of .info and .biz names.

On June 25, 2001, ICANN recommended to DOC that these two new TLDs be entered into the root. On June 26, 2001, DOC concurred and instructed that the TLDs be entered in the root, and this was accomplished on that day. As of June 27, 2001, both .biz and .info became operational for the initial testing and implementation stage. They will begin resolving names being registered for customers by the early fall of this year.

These two new global TLDs are the first of seven approved by the ICANN Board of Directors last November. Agreements still remain to be signed for the remaining five top-level domains: .name, .pro, .aero, .coop, and .museum. Contract negotiations are continuing for the remaining new TLDs, and are expected to be completed later this summer.

At its most recent public meeting, the ICANN Board adopted Resolution [01.74], which directed the President to form and chair a New TLD Evaluation Process Planning Task Force, in order to create a plan to monitor the introduction of these new TLDs and evaluate their performance and their impact on the performance of the DNS. This Task Force was directed to report its recommendations at the next ICANN public meeting in September 2001.

Thus, considerable progress under this task has been made, and is continuing.

C. Summary of Current Status of the Joint Project

As the above discussion indicates, most of the tasks set forth in the amended MOU are either complete or well on the way to completion. They can be summarized as follows:

Task 1 is largely completed. The ongoing work today involves the creation of two new RIRs.

Task 2 is still underway, with expectations that this task will either be completed or its usefulness reevaluated in the near future.

Task 3 should be completed within 60 days.

Task 4 is well underway, and should be completed in the foreseeable future. All of the conceptual work has been completed, and what remains is technical detail and agreement on specific language of undertakings.

Task 5 will follow the completion of Task 4.

Task 6 is probably the task with the most work left to do, but recent progress leaves considerable reason to believe that the pace of completion of this task is likely to accelerate sharply in the near future.

Task 7 is ongoing, with the first wave of new TLD introductions likely to be completed by the end of 2001.

D. Steps Required for Completion of the Joint Project

The progress toward completion of the Joint Project has increased markedly since the Second Amendment of the MOU less than a year ago.

During that period, ICANN has:

  • authorized seven new TLDs and begun the process of determining how to evaluate their impact on the DNS;

  • continued to accredit competitive registrars for both the original and the new TLDs;

  • entered into a license agreement with DOC for the use of the InterNIC service mark to be used in providing InterNIC services;

  • created an At Large Membership Study Committee with the objective of generating a consensus solution to the issue of general Internet
    user participation and involvement in ICANN;

  • engaged in a number of educational and technical efforts involving the rationale for a single authoritative root and internationalized domain names, among other topics;

  • renegotiated contracts with VeriSign for the operation and term of the .com, .net and .org registries;

  • established criteria for the authorization of new regional address registries; and

  • revised its budget process to enhance broad participation and transparency.

All of these steps and the other progress made by ICANN and its constituent units are consistent with, and further the implementation of, the objectives of the Joint Project.

There are still important tasks unfinished, but all indications are that each is on the path to resolution. Since it is unlikely that all the unfinished tasks will be completed by the current termination date of the MOU, the MOU should be extended for an appropriate time in order to complete those tasks.

Submitted by ICANN on July 3, 2001


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