ICANN | ICANN Meetings in Kuala Lumpur | ICANN Public Forum Real-Time Captioning

ICANN Meetings in Kuala Lumpur

ICANN Public Forum

Thursday, 22 July 2004

Note: The following is the output of the real-time captioning taken during the ICANN Public Forum held on 22 July, 2004 in Kuala Lumpur, Malaysia. Although the captioning output is largely accurate, in some cases it is incomplete or inaccurate due to inaudible passages or transcription errors. It is posted as an aid to understanding the proceedings at the session, but should not be treated as an authoritative record.

ICANN PUBLIC FORUM THURSDAY, JULY 22, 2004 KUALA LUMPUR, MALAYSIA 9:00 A.M.

>>VINT CERF: GOOD MORNING.

WOULD THE BOARD MEMBERS KINDLY TAKE THEIR SEATS. ALL RIGHT, LADIES AND GENTLEMEN, I THINK WE ARE NOW PREPARED TO CALL THE MEETING TO ORDER. THIS IS THE PUBLIC FORUM PART OF THE ICANN MEETINGS. WE HAVE A VERY PACKED SCHEDULE, AS USUAL. I AM GOING TO TRY VERY, VERY HARD TO STAY ON TARGET TO CLOSE AT NOON FOR LUNCH AND THEN REOPEN AGAIN AT 2:00. THERE'S A SLIGHT POSSIBILITY THAT I WILL BE AWAY AT THAT TIME WHEN WE BEGIN AGAIN AT 2:00. AND IF THAT'S THE CASE, I'LL ASK ALEJANDRO PISANTY, THE VICE-CHAIRMAN, TO OPEN THE MEETING AND CONTINUE UNTIL I RETURN. SO LET'S BEGIN. I'D LIKE TO CALL ON THE PRESIDENT AND CEO, PAUL TWOMEY, TO MAKE HIS REPORT.

>>PAUL TWOMEY: THANK YOU, VINT.

GOOD MORNING, BOARD. GOOD MORNING, LADIES AND GENTLEMEN, AND GOOD MORNING TO PEOPLE ON THE OTHER END OF THE ONLINE VIDEO STREAMING. IF I COULD BRING YOU THE PRESIDENT'S REPORT ON WHAT'S BEEN A VERY BUSY LAST MONTH SINCE WE LAST MET. THERE'S TWO SORT OF MAIN AREAS I THINK I'D LIKE TO TALK THROUGH IN TERMS OF AGENDA. ONE IS, AS HAS BEEN CLEAR TO ME IN THIS MEETING, WE HAVE A LOT OF PEOPLE NOW IN THE ICANN PROCESS WHO ARE -- WHO HAVE BECOME INVOLVED IN THE PROCESS SINCE THE FORMULATION OF ICANN. AND AS HAS BEEN VALUABLE IN A NUMBER OF THE CONSTITUENCY MEETINGS THAT I HAVE ATTENDED THIS WEEK, GOING THROUGH A LITTLE BIT OF THE ORIGINS OF WHY ICANN WAS FORMED AND WHAT SORT OF PROBLEMS ITS OWN STRUCTURE IS DIRECTED TOWARDS SOLVING I THINK MIGHT BE USEFUL TO REPEAT. AND THEN I THINK THE ACHIEVEMENTS SINCE ROME AND OUR ONGOING WORK. I'D LIKE JUST TO SUMMARIZE QUICKLY FOR PEOPLE WHERE WE HAVE COME FROM.

AND AS WE MAY SAY, IN THE BEGINNING, THERE WAS DARPANET. BACK IN '69, SOME PEOPLE, INCLUDING THE CHAIRMAN, AND STEVE CROCKER AND A FEW OTHERS WHO ARE IN THIS ROOM, WERE INVOLVED IN PUTTING TOGETHER THE FIRST OF THE NODES OF WHAT BECAME THE INTERNET. AND THE PERFORMANCE OF THE FUNCTIONS OF THESE -- OF THIS NETWORK WAS HANDLED BY A SERIES OF INDIVIDUALS, AND OFTEN UNDER VARIOUS AMENDING, CHANGING, AND SOMEWHAT FLUCTUATING AGREEMENTS WITH THE UNITED STATES GOVERNMENT. ONE OF THE KEY FUNCTIONS, OF COURSE, WAS THE IANA FUNCTION, WHICH JON MANAGED FOR A LONG PERIOD OF TIME. THE TROUBLE, OF COURSE, WITH THE INTERNET, THE GREAT THING WITH THE INTERNET WAS IT BECAME TERRIBLY SUCCESSFUL. I SUSPECT THE PROBLEM FOR MANY PEOPLE WAS THAT IT BECAME VERY SUCCESSFUL. IN THE SENSE OF THAT THE MODELS THAT HAVE BEEN PUT IN PLACE FOR THE FIRST 30 YEARS OR 25 YEARS OR SO OF THE INTERNET BECAME UNDER INTENSE STRAIN ONCE WE HAD THE BROWSERS, ONCE WE'D HAD THE WORLDWIDE WEB, ONCE WE HAD AN INCREDIBLY GROWING COMMERCIAL AND SOCIAL INTERACTION WITH THE INTERNET. AND A WHOLE SERIES OF CONSTITUENCIES EMERGED WITH ISSUES AROUND THE DOMAIN NAME SYSTEM AND THE ADDRESSING SYSTEM WHICH I THINK PUT THE PREVIOUS ADMINISTRATIVE PROCESS UNDER BREAKING STRAIN.

NOW WE HAD THE PRESSURES OF INTEREST GROUPS FIGHTING FOR PARTICULAR THINGS THAT THEY WERE CONCERNED ABOUT WHICH WERE INFLUENCED BY THE DNS AND LOOKING FOR A WAY IN WHICH TO TRY AND ADDRESS THESE. THE CLINTON ADMINISTRATION IS THAT YOU PROBLEM, IN MANY RESPECTS, BECAUSE THE NATURAL THING FOR PEOPLE TO DO WHEN THEY'RE UNHAPPY ABOUT SOMETHING WAS TO GO AND COMPLAIN TO THE GOVERNMENT. AND THE PROBLEM THEY FACED WAS A TWOFOLD ONE. FIRST OF ALL, THEY COULDN'T FIX THE PROBLEM, BECAUSE MOST OF THE STUFF WAS NOT DONE, MOST OF THESE ISSUES WERE NOT FIRMLY IN THE GRIPS OF GOVERNMENT CONTROL. AND SECONDLY, PARTICULARLY AS THE NET GREW AND AS WE HAD A RESIDUAL MONOPOLY POSITION IN THE REGISTRY AND REGISTRAR, PARTICULARLY REGISTRY AND REGISTRAR FUNCTIONS IN DOT NET, DOT-COM, AND DOT ORG, NOW WE HAD A BOOMING MONOPOLY WITH A GOVERNMENT, TO A SINGLE GOVERNMENT CONTRACT, AND THERE WAS A CERTAIN POLITICAL/PHILOSOPHICAL DISCOMFORT ABOUT THIS WAS NOT AN APPROPRIATE ROLE FOR GOVERNMENT IN SUCH A NOW LIBERALIZING -- SUCH A GLOWING MARKET. THIS WAS THE STRAIN, I THINK, THAT JON POSTEL AND IANA SAW, THE U.S. ADMINISTRATION SAW, AND ALSO A STRAIN A SERIES OF OTHER GOVERNMENTS SAW, NAMELY CERTAINLY IN 1998, AUSTRALIA, CANADA, JAPAN, UNITED KINGDOM, AND THE EUROPEAN COMMISSION ALL BEGAN TO TALK ABOUT THIS ISSUE DOMESTICALLY, SAYING THIS IS THE SAME ISSUE INTERNATIONALLY AND THERE NEEDS TO BE SOME SOLUTION DEVELOPED.

THERE WAS A LOT OF TOING AND FROING, BUT THE BASIC CHANGES DRIVING THIS CHANGE WAS THE INTERNET WAS GLOBALIZING, AND IN THAT PERIOD OF TIME, WITH THE GLOBALIZATION OF INTERNET, I DON'T MEAN IN ANY WAY TO DISCREDIT THE MANY TECHNICAL AND ACADEMIC MEMBERS OF THE INTERNATIONAL COMMUNITY WHO WERE INVOLVED IN THE INTERNET FROM THE VERY EARLY DAYS. BUT IN TERMS OF GLOBALIZATION, IN TERMS OF THE AVERAGE USER, WHAT WE NOW KNOW AS THE AVERAGE USER, THE REAL BOOM TOOK PLACE FIRST IN THE UNITED STATES THEN IN NORTH AMERICA, AND THEN IN THE OECD COUNTRIES IN A WAVE OF COUNTRIES THAT I WOULD CALL OECD PLUS. IT'S BEEN WHERE IT HAS GROWN IN A HUGE J CURVE. THE ISSUES THAT EMERGED IN '95, '96, '97 WERE ESSENTIALLY AMERICAN ISSUES WHICH BECAME OECD ISSUES. IF I WAS TO SAY ANYTHING, IN 2004, THESE ISSUES ARE MORE TRUE, SOME OF THEM ARE IN TERMS OF THE GLOBALIZATION OF THE INTERNET, ITS COMMERCIALIZATION IN TERMS OF -- BOTH IN TERMS OF THE WAY ITS SERVICES ARE SOLD, BUT MORE IMPORTANTLY IN TERMS OF THE ECONOMIC INFRASTRUCTURE IT OFFERS TO THE REST OF THE ECONOMY, THE NEEDS FOR ACCOUNTABILITY, OF A FORMALIZED MANAGEMENT STRUCTURE, A LACK OF COMPETITION, AND A WHOLE SERIES OF CONFLICTS THAT TOOK PLACE AROUND TRADEMARKS AND DOMAIN NAMES AND CENSORS AND OWNERSHIP OF INTELLECTUAL PROPERTY.

THE RESPONSE TO ALL THOSE DEMANDS WAS FIRST OF ALL TO THINK THROUGH CAREFULLY WHAT ARE THE KEY PRINCIPLES THAT YOU SHOULD APPLY TO THIS. THESE PRINCIPLES FIRST APPEARED IN THE WHITE PAPER PUT FORWARD BY THE U.S. ADMINISTRATION, BUT WHICH WERE -- I THINK RECEIVED A LARGE DEGREE OF POSITIVE COMMENT FROM THE COMMUNITY. AND THESE PRINCIPLES ARE ALSO INCORPORATED INTO ICANN'S OWN OPERATIONS. I WOULD STRESS THE POINT, THE FIRST OF THESE PRINCIPLES, TO CONTRIBUTE TO THE STABILITY AND SECURITY OF THE UNIQUE IDENTIFIERS SYSTEM AND ROOT MANAGEMENT, IS NOT AS SOME PEOPLE RECENTLY SAID TO ME SOMETHING WE HAVE DECIDED TO DO RECENTLY BECAUSE IT SOUNDS SEXY. THIS IS SOMETHING THAT WAS AT THE VERY CORE OF THE PRINCIPLE OF OPERATIONS. IT WAS THE FIRST OPERATION LAID DOWN IN THE WHITE PAPER IN 1998 BEFORE THE FORMATION OF NEWCO. SO IT'S BEEN ONE OF THE CORE PRINCIPLES BEHIND THE ESTABLISHMENT OF THIS MULTI STAKEHOLDER INTERNATIONAL, SELF-REGULATORY MODEL FROM THE BEGINNING. TO PROMOTE COMPETITION AND CHOICE FOR REGISTRANTS AND OTHER USERS. PROVIDE A FORUM FOR MULTI-STAKEHOLDER BOTTOM-UP DEVELOPMENT OF RELATED POLICY. AND TO ENSURE ON A GLOBAL BASIS AN OPPORTUNITY FOR PARTICIPATION BY ALL INTERESTED PARTIES. THESE ARE FOUR CORE PRINCIPLES. I KNOW WE HAVE, IN THE STAFF AND IN THE BOARD HAVE GONE BACK AND EVALUATED THESE AND WE THINK JUST AS TRUE THEY WERE IN THE WHITE PAPER IN '98, THEY ARE TRUE TODAY AS BEING THE CORE PRINCIPLES WHICH SHOULD GUIDE THE OPERATION OF THIS INTERNATIONAL, MULTISTAKEHOLDER SELF-REGULATORY ENVIRONMENT THAT WE ARE ESTABLISHING THROUGH ICANN.

THE POINT I'D ALSO MAKE, IT'S ACTUALLY IN THESE SLIDES, IS THE ICANN STRUCTURE AS IT PRESENTLY HAS BEEN PUT TOGETHER WITH THE ADDRESSING SUPPORTING ORGANIZATION, THE GENERIC NAMES SUPPORTING ORGANIZATION, NOW WITH THE COUNTRY CODE NAME SUPPORTING ORGANIZATION, WITH THE ADVISORY COMMITTEES, HAS A HOME FOR EVERY ONE OF THESE INTEREST GROUPS. AND THE MODEL AS PEOPLE DESCRIBED IT SOME YEARS AGO WHEN IT WAS BEING PUT TOGETHER IS A SIMPLE ONE. THOSE WHO CREATE THE PROBLEM SOLVE THE PROBLEM. IT'S BRINGING TOGETHER A MODEL FOR COORDINATION AND COOPERATION OF ALL OF THESE VARIOUS INTEREST GROUPS. IT IS INHERENTLY NOISY, BECAUSE THEY HAVE TO FIGHT ABOUT THINGS THEY THINK ARE IMPORTANT TO THEIR INTEREST GROUPS. BUT IT IS A MODEL TO ENSURE ALL THESE PEOPLE, AND OTHERS, ARE REPRESENTED.

SOME OF THE AUTHORITATIVE FUNCTIONS THAT ARE ALREADY TIED TO THAT, THE OPERATION OF THE IANA FUNCTION. I'D LIKE TO MAKE THE POINT ABOUT THAT WHEN IT COMES TO WHERE WE'RE BASED. JON POSTEL WAS AN AMAZING MAN. ONE OF THE THINGS HE WAS NOT -- PERHAPS NOT SO AMAZING ABOUT WAS HE DIDN'T LIKE UNIVERSITY BUREAUCRACY. SO MY UNDERSTANDING, HE HAD AN OFFICE IN A BUILDING IN SOUTHERN CALIFORNIA TO BE AS FAR AWAY FROM THE HEAD OFFICE OF THE UNIVERSITY AS HE COULD AND STILL BE PART OF THE UNIVERSITY. ICANN'S NAME WAS VERY MUCH FORMATTED BY JON'S OWN THINKING AND ICANN'S LEGAL STATUS, WHERE WE WERE ACTUALLY FORMED, IS BECAUSE THAT'S WHERE JON WAS. SO WE ARE A CALIFORNIA NOT-FOR-PROFIT PUBLIC BENEFIT CORPORATION BECAUSE JON WAS BASED IN CALIFORNIA AND JON WAS GOING TO BE THE CHIEF TECHNOLOGY OFFICER OF ICANN.

IT'S A GREAT TRAGEDY FOR US ALL THAT JON PASSED ON PREMATURELY. BUT THAT'S -- YOU KNOW, THAT'S THE ORIGIN OF WHERE WE'RE BASED. IT WAS NOT SEEM DONE WITH THE UNITED STATES GOVERNMENT, WHICH IS A PRETTY KEY POINT TO MAKE.

I'M GOING TO COME BACK TO THAT LEGAL JURISDICTION QUESTION LATER IN THIS PRESENTATION. WE ALSO -- IN IMPLEMENTING THE COMPETITION MODEL FOR THE GENERIC TOP-LEVEL DOMAINS, WE NOW HAVE AUTHORITATIVE FUNCTION FOR THE GTLD FORMATION AND FOR THE REGISTRY AGREEMENTS; SIMILARLY, THE REGISTRAR AGREEMENTS FOR THE SECOND-PART MODEL THAT WAS CREATED TO INTRODUCE COMPETITION IN THOSE MARKETS. AND WE'RE ALSO WORKING -- WE HAVE A SERIES OF ARRANGEMENTS WITH CCTLDS TO HAVE THEM RECOGNIZED ON THE ZONE FILE. AND ONE OF THE AREAS WE WANT TO MOVE FURTHER ON IN GOOD CONSULTATION IS WHAT WE CALL ACCOUNTABILITY FRAMEWORKS, JUST BEING CLEAR WITH CC'S WHAT IT IS THAT THE ICANN MODEL OWES THEM TO ENSURE A SINGLE END-TO-END INTEROPERABLE INTERNET AND WHAT IT IS THEY OWE TO THE -- IN RESPONSE. AND THAT'S SOMETHING WE'RE WORKING THROUGH IN CONSULTATION WITH CC'S. AND WE'RE PARTICULARLY LOOKING FORWARD TO CONSULTATION WITH THE CCNSO ON ASPECTS OF THAT.

AS I SAID, THERE IS ACTUALLY A HOME IN THIS MODEL FOR ALL OF THOSE INTEREST GROUPS THAT PREVIOUSLY WERE IN DISPUTE WITH EACH OTHER OR FIGHTING WITH EACH OTHER. AND, IMPORTANTLY, IF YOU LOOK AT THE BOARD OF DIRECTORS, THE BOARD OF DIRECTORS IS CONSTITUTED WITH PEOPLE ELECTED FROM EACH OF THESE SUPPORTING ORGANIZATIONS, PLUS PEOPLE, IF YOU LIKE, INDEPENDENT DIRECTORS, WHICH IS INCREASINGLY AN IMPORTANT ISSUE IN A POST-ENRON, POST-MCI CORPORATE ENVIRONMENT, CORPORATE GOVERNANCE ENVIRONMENT. WE HAVE NOMINATING COMMITTEE APPOINTED DIRECTORS -- THAT THOSE -- THE BOARD OF DIRECTORS COMES FROM ACROSS ALL OF THOSE INTEREST GROUPS, REPRESENTATIONS, THAT THOSE BOARD OF DIRECTORS HAVE FIDUCIARY OBLIGATION TO THE ORGANIZATION AS A WHOLE, AND THE BOARD HAS BEEN ESTABLISHED IN SUCH A WAY THAT IT IS NOT POSSIBLE FOR ONE PARTICULAR INTEREST GROUP TO CAPTURE THE BOARD. VERY CAREFUL THINKING ABOUT THE NATURE OF THE ANTITRUST STRUCTURE FOR THIS ORGANIZATION. IT WAS DONE AT THE VERY BEGINNING. AND I POINT THAT OUT TO YOU BECAUSE SOME OF YOU MAY GET A LITTLE ALARMED OR A LITTLE PERTURBED WHEN YOU HEAR ABOUT, YOU KNOW, ANTITRUST ACTIONS IN COURTS. ALL SUCH THINGS GET ALLEGED; IT'S A SEPARATE ISSUE WHAT COMES OUT FROM A JUDGE. BUT THE POINT I WOULD LIKE TO MAKE TO YOU IS THE STRUCTURE FROM THE VERY BEGINNING ALWAYS THOUGHT ABOUT THE VERY IMPORTANT ISSUES TO ENSURE THIS WAS AN ORGANIZATION THAT COULD NOT BE CAPTURED, THIS WAS A COMMUNITY WHICH COULD NOT BE CAPTURED BY A PARTICULAR INTEREST GROUP.

IF I CAN MOVE ON, THEN, I'D LIKE TO SHARE A LITTLE BIT WITH YOU SOME OF THE OPERATIONAL THINGS SINCE WE LAST SPOKE. FIRST ONE I'D LIKE TO TALK ABOUT IS THE IANA FUNCTIONS. AND TO GIVE YOU SOME INDICATION OF THE EMPHASIS THAT WE HAVE BEEN PLACING ON IMPROVING PERFORMANCE IN THE IANA FUNCTIONS, I WANT TO SHARE SOME INFORMATION AROUND THE ZONE FILE, NAME SERVER SERVICES PARTICULARLY TO TLDS AND CCTLDS.

THIS IS -- ACTUALLY, I'D LIKE TO THANK CENTR FOR THIS WORK THAT THEY HAVE DONE. THIS IS SOME SURVEY WORK THEY DID WITH SOME 30 OF THEIR MEMBERS. THIS IS DATA PUBLICLY AVAILABLE OFF THEIR WEB SITE SHOWING TURNAROUND TIMES IN REQUEST FOR NAME SERVER MODIFICATIONS. THE DOTTED LINE IS SOMETHING THAT I HAVE PUT IN, AND IT IS ACTUALLY AN ERROR. IT SHOULD BE FURTHER TO THE RIGHT. AND THE DOTTED LINE IS MEANT TO INDICATED DOUG BARTON'S APPOINTMENT AS GENERAL MANAGER OF IANA. DOUG AND PARTICULARLY HIS TEAM MADE A VERY BIG EFFORT TO INCREASE TURNAROUND TIMES.

THIS WAS A SURVEY OF SOME 30 OR SO CCTLDS. THIS IS ACTUALLY OUR INTERNAL MANAGEMENT DATA OF ALL REQUEST FOR ZONE FILE CHANGES AND THE PROCESSING TIME. AND THE DATA SHOWS AT THE HORIZONTAL AXIS THE DAY THAT A REQUEST ENTERED THE QUEUE. AND ON THE VERTICAL AXIS, HOW MANY DAYS THAT REQUEST SPENT IN THE QUEUE BEFORE IT WAS FINALIZED. YOU WILL SEE THERE'S A FAIRLY HIGH VARIABILITY ACCORDING TO WHAT SORT OF REQUEST IS MADE. AS I HAVE SAID BEFORE, A LOT OF THE REQUESTS THAT COME INTO THE IANA ARE NOT AT ALL SIMPLE. NOT ONLY BECAUSE WHAT THEY ASK FOR MIGHT BE COMPLICATED, BUT IMPORTANTLY, ALL THE INTERACTIONS WITH THE THIRD PARTIES WHO ARE INVOLVED SOMETIMES IS MUCH MORE COMPLEX THAN PEOPLE MAY THINK. NEVERTHELESS, THE TREND DATA HERE, I THINK, IS VERY GOOD. WE'RE NOW LOOKING AT A MEAN OF THREE DAYS OR LESS THAN THREE DAYS FOR TURNAROUND ON ZONE FILE CHANGES IN TERMS OF IANA'S PROCESSING TIMES.

THE SECOND CHART, WHICH I HOPE YOU CAN SEE BETTER THAN I CAN. I'M COLORBLIND, SO I HAVE PROBLEMS WITH CHARTS LIKE THIS. BUT THE TOP LINE IS THE TOTAL ELAPSED TIME. THE BOTTOM LINE IS THE TIME IN THE IANA. AND YOU WILL SEE THAT A LOT OF THE DELAY NOW IS NOT IN IANA PROCESSING, BUT MORE IN TERMS OF THE TIME WE NEED BEING BACKWARDS AND FORWARDS WITH THE PEOPLE MAKING THE REQUESTS AND PASSING THE REQUESTS ON TO THE FINAL STAGE. SO I THINK, GENERALLY, I'D LIKE TO CONGRATULATE THE IANA STAFF ON -- IN THIS AREA IN PARTICULAR -- A REAL FOCUS ON IMPROVEMENT OF TURNAROUND TIMES TO BE RESPONSIVE TO THE CCTLD AND GTLD COMMUNITY.

ANOTHER THING THAT THE IANA STAFF HAVE BEEN INVOLVED IN, WHICH BECAME TRUE YESTERDAY MORNING AT 2:00 MALAYSIAN TIME, IS THE INTRODUCTION OF IPV6 INTO THE ROOT. THIS IS A SIGNIFICANT STEP FORWARD AND A MILESTONE. THERE WILL BE MORE ABOUT THIS LATER TODAY. BUT I THOUGHT I'D JUST STRESS, AGAIN, TALKING ABOUT THE ICANN MODEL, I THINK IT INDICATES THE SUCCESS OF COORDINATION AND COOPERATION THROUGH THE ICANN PROCESS. THIS REQUEST ORIGINATED FROM CCTLD MANAGERS. WE SOUGHT THE HELP OF THE ROOT SERVER SYSTEM ADVISORY COMMITTEE, WHO ADDRESSED TECHNICAL QUESTIONS AND CONDUCTED A THOROUGH STUDY AND SENT AN ADVICE TO THE ICANN BOARD. THE ICANN BOARD IMPLEMENTED THE RECOMMENDATIONS FOLLOWING PUBLIC CONSULTATION WITH THE COMMUNITY, I THINK ALSO IN CONSULTATION WITH THE SECURITY AND STABILITY ADVISORY COMMITTEE STAFF OR MEMBERS. AND IT'S THROUGH THAT CONSULTATION, THEN, THAT THIS HAS MOVED FORWARD. SO I THINK THIS IS A VERY GOOD EXAMPLE OF THE ICANN MODEL WORKING IN TERMS OF COORDINATION, IN TERMS OF BRINGING SOMETHING UP FROM THE COMMUNITY, ENSURING A SENSE THAT WE ALL THINK THIS IS A GOOD THING AND WILL WORK WELL, AND IMPLEMENTING ALL FOR OUR BENEFITS. ANOTHER AREA OF PROGRESS

IN THE LAST -- SINCE WE HAVE LAST MET IN ROME DEALS WITH THE MEMORANDUM OF UNDERSTANDING WITH THE DEPARTMENT OF COMMERCE. I WANT TO BE QUITE CLEAR WHAT THIS MOU IS, BECAUSE A LOT OF PEOPLE WILL GIVE YOU STORIES ABOUT WHAT IT IS WHICH ARE NOT, I DON'T THINK, NECESSARILY ACCURATE. TWO ADMINISTRATIONS IN THE UNITED STATES, ONE DEMOCRAT AND ONE REPUBLICAN, HAVE COME TO A SIMILAR CONCLUSION, WHICH IS THE COORDINATION OF THOSE TECHNICAL FUNCTIONS OF THE DOMAIN NAME SYSTEM AND THE IP ADDRESSING SYSTEM ARE BEST DONE AS A SORT OF MULTISTAKEHOLDER, COORDINATED, INTERNATIONAL MODEL, AND THAT IT'S BEST NOT DONE BY THE U.S. GOVERNMENT. AND THEY HAVE BEEN CLEAR IN THEIR STATEMENTS IN THAT. HOWEVER, AS YOU WOULD EXPECT, AND I CERTAINLY WOULD EXPECT, IF THEY PREVIOUSLY HAD SOME RESPONSIBILITY IN THE FIRST 25 YEARS OR 30 YEARS OF THESE FUNCTIONS, THEY FEEL STRONGLY THEY HAVE A RESPONSIBILITY TO ENSURE A TRANSITION SHOULD TAKE PLACE WHICH IS SMOOTH, WHICH IS SHOWN TO BE STRONG, AND WHERE THEY HAVE DONE THE APPROPRIATE DUE DILIGENCE. THIS, AS IT'S BEEN PUT TO ME, THIS KEY PIECE OF INFRASTRUCTURE THEY HAVE TO -- AND TECHNOLOGY THEY HAVE TO ENSURE IT'S GOING TO WORK WELL.

THE MOU IS A TRANSITION DOCUMENT. IT IS A DUE DILIGENCE DOCUMENT ON BEHALF OF THE UNITED STATES GOVERNMENT TO ENSURE THAT WE, AS A COMMUNITY, HAVE REACHED TO THE STAGE OF OPERATIONAL AND POLICY MATURITY THAT THEY CAN HAVE CONFIDENCE THAT THIS IS BEING PUT INTO A LONG-TERM, SUSTAINABLE, INTERNATIONAL, AND REPRESENTATIVE ENVIRONMENT SO THESE FUNCTIONS CAN BE OPERATED IN AN AUTONOMOUS MANNER. AND YOU CAN'T BLAME THEM, FOLKS. RIGHT?

YOU DON'T TAKE THIS STUFF AND JUST SAY, OH, WE'RE FINISHED. HAVE A NICE DAY. ALL RIGHT? THE MOU IS A PROCESS. NOW, LIKE MANY STARTUPS, AND I USED TO -- I FOUNDED AN INCUBATOR SEVERAL YEARS AGO AND WAS IN THE STARTUP BUSINESS FOR A LITTLE WHILE. I STILL HAVE SOME INTERESTS IN STARTUPS -- ALL STARTUPS, EVERYBODY WHO IS DOING A STARTUP THINKS THEY'RE GOING TO GET DONE FASTER AND QUICKER. IT ALWAYS TAKES LONGER AND IS MORE COMPLICATED THAN WHAT THEY THINK. AND I THINK ICANN AND THIS COMMUNITY HAS BEEN A CASE OF THE SAME. THAT WHEN THIS PROCESS STARTED OFF, THERE WAS AN EXPECTATION THAT WE WOULD BE ABLE TO ACHIEVE THAT MATURITY FASTER THAN TO THE DEGREE WE HAVE. SO THE MOU GOT EXTENDED ON AN ANNUAL BASIS BECAUSE THE PEOPLE RESPONSIBLE FOR DUE DILIGENCE WANTED TO ENSURE, JUST LIKE A VENTURE CAPITALIST DOES IN A STARTUP, WANTS TO MAKE CERTAIN THIS MODEL IS ACTUALLY WORKING AND IS MATURE.

NOW, IN THE DISCUSSIONS SINCE SEPTEMBER LAST YEAR, I THINK THE COMMUNITY HAD REACHED THAT STAGE AND THE ORGANIZATION REACHED SUCH A STAGE THAT THE DEPARTMENT OF COMMERCE FELT COMFORTABLE TO SAY, OKAY, HERE'S THE FINAL MOU. WE ARE NOW CONFIDENT THAT YOU ARE STARTING TO REACH THAT STAGE OF MATURITY. HERE'S THE FINAL MOU AND THE FINAL SET OF MILESTONES. AND THEY LAID OUT, ESSENTIALLY, 24 MILESTONES THAT THEY WANTED TO SEE FULFILLED SO THAT WE COULD THEN REACH THOSE AND MOVE ON. WE ARE NINE MONTHS INTO THAT MOU, AND SEVEN OF THE 24 MILESTONES HAVE BEEN COMPLETED. AND OTHERS OF THOSE ARE ON TIME OR AHEAD OF SCHEDULE. AND I WILL GIVE YOU MORE OF AN UPDATE ON SOME OF THOSE.

IN PARTICULAR, I WANT TO TALK ABOUT CONTINGENCY PLANNING. IT'S ONE OF THE THINGS THAT WE ACTUALLY TALK AND DISCUSS TO THE DEPARTMENT OF COMMERCE IN THE DISCUSSIONS OF THE MOU, THAT IF YOU RUN A BUSINESS WELL, YOU HAVE TO HAVE CONTINGENCY PLANNING FOR THINGS GOING WRONG. AND SO ONE OF THE BUILDINGS OF -- ONE OF THE WAYS OF DIMINISHING RISK IN THE OPERATIONS OF THESE FUNCTIONS IS TO MAKE SURE THAT THE CONTINGENCY PLANNING HAS BEEN DONE. I MAKE THAT POINT, MR. CHAIRMAN, BECAUSE THERE IS -- YOU CAN HAVE A PERCEPTION, BECAUSE WE'RE TALKING ABOUT CONTINGENCY PLANNING, THAT WE SECRETLY THINK THE RISK IS HIGHER THAN IT HAS BEEN. THAT IS NOT THE CASE. WE ACTUALLY SEE THE PLANNING FOR CONTINGENCY PLANNING AS ACTUALLY DIMINISHING THE RISK. THERE ARE TWO ASPECTS WE FEEL IT'S NECESSARY TO PLAN FOR CONTINGENCIES. THE FIRST IS THE OPERATIONS IN CASE OF A NATURAL DISASTER OR OTHER PHYSICAL OR OPERATIONAL EVENT TO ENSURE ONGOING OPERATIONS AND NO LOSS TO GLOBAL INTERNET COMMUNITY. MANY OF YOU INVOLVED IN TECHNICAL OPERATIONS AND NETWORK OPERATIONS WILL APPRECIATE EXACTLY THOSE CONTINGENCIES.

THE SECOND ONE IS BUSINESS FAILURE OR INSOLVENCY TO ENSURE ONGOING OPERATIONS AND NO LOSS TO GLOBAL INTERNET COMMUNITY. AND WE HAVE THOUGHT ABOUT THIS VERY CAREFULLY. AND INTERESTINGLY, IN DISCUSSIONS WITH THE CCNSO AND OTHERS ABOUT HOW DO YOU HAVE BEST PRACTICE FOR CONTINUING OPERATIONS? I SUSPECT WHAT DO YOU DO IN THE CASE OF BUSINESS FAILURE IS NOT SOMETHING AS WELL THOUGHT THROUGH GENERALLY THROUGHOUT THE COMMUNITY AS THE FIRST ISSUE IS. A LOT OF PEOPLE THINK ABOUT TECHNICAL FAILURE. BUT WHAT DO YOU DO IN CASE OF BUSINESS FAILURE IS NOT NECESSARILY SOMETHING AS WELL CONSIDERED IN EVERY REGISTRY AROUND THE WORLD AS THE FIRST ITEM. BUT WE HAVE TRIED TO PUT A LOT OF EFFORT INTO THIS ISSUE ABOUT WHAT YOU DO IN CASE OF BUSINESS FAILURE. SO THE FIRST OBJECTIVE ON GLOBAL OPERATIONS IS PRETTY STRAIGHTFORWARD, TECHNICAL, AND TAKING ADVANTAGE OF ICANN'S GLOBAL NATURE SO THAT WE CAN ESSENTIALLY WITHSTAND OUTAGES IN VARIOUS PLACES FOR VARIOUS DURATIONS. LET'S COME TO THE BUSINESS FAILURE OBJECTIVE. THAT IS TO ENSURE THAT THE CORE AND NECESSARY FUNCTIONS ARE CARRIED OUT AND THAT THE RELEVANT RELATIONSHIPS, AGREEMENTS, AND PUBLIC MESSAGES ARE MANAGED TO ENSURE STABILITY AND SECURITY OF THE DNS AND THE INTERNET. IT IS TO ENSURE THAT THESE FUNCTIONS CONTINUE TO OPERATE SMOOTHLY, THAT THE AUTHORITATIVE FUNCTIONS OPERATE SMOOTHLY, THAT YOU DON'T HAVE ANY SENSE OF IT'S SUDDENLY GOING TO FALL OFF THE EDGE OF THE EARTH WHILE WE HAVE TO DEAL WITH AN ACTUAL BUSINESS FAILURE OR FINANCIAL FAILURE OF ICANN AS AN ENTITY. AND THERE'S A SERIES OF STEPS THAT HAVE BEEN WORKED THROUGH.

THE FIRST ONE IS THAT THE ICANN EXECUTIVE STAFF COMMUNICATE TO THE CHAIRMAN THAT THERE'S A PROBLEM. AND WITH BUSINESS FAILURE OR INSOLVENCY, THESE ARE SORT OF THE PROBLEMS THAT DON'T HAPPEN SUDDENLY. THEY'RE THE SORT OF THING YOU ARE GOING TO GET INDICATIONS OF THAT THIS IS A DIFFICULTY. THE SECOND IS THAT THE ICANN CHAIRMAN IS TO INITIATE AN INVESTIGATION BY AN INDEPENDENT AUDITOR TO CONFIRM THE NATURE OF FINANCIAL ISSUES. IF THERE'S A DETERMINATION THERE'S A RISK OF INSOLVENCY OR COMPLETE BUSINESS FAILURE, THERE IS TO BE A CREATION OF AN EXECUTIVE STABILITY COMMITTEE WITH THE UGLY ACRONYM EXSTABCOM, WITH AN APPOINTED EMINENT PERSON, ADDING THREE PEOPLE, INCLUDING THE CHAIR OF THE SECURITY AND STABILITY COMMITTEE, THE CHIEF FINANCIAL OFFICER, AND AN INDEPENDENT AUDITOR. THESE FOUR PEOPLE'S RESPONSIBILITY WILL BE TO ENSURE THAT EXECUTIVE DECISIONS ARE MADE SUCH THAT THE ELECTRICITY IS KEPT ON, WORK KEEPS HAPPENING. THERE WILL BE CONSULTATION AND ADVICE SOUGHT FROM THE WIDER COMMUNITY, IF APPROPRIATE, TO ENSURE ONGOING OPERATIONS OR CORE FUNCTIONS. ANOTHER THING THAT THE EXSTABCOM WILL DO IS APPOINT AN EMERGENCY NAMES AND ADDRESSING COMMITTEE. AND THE PURPOSE OF THIS COMMITTEE IS TO ASSIST THE EXSTABCOM TO EXECUTE ICANN'S TECHNICAL AND OPERATIONAL FUNCTIONS. AND HERE IS AN IMPORTANT ISSUE. TO ASSIST THAT GROUP TO FORM A REPLACEMENT OR REFORMED ENTITY. IF YOU LIKE, IF IT'S A -- IF THOSE OF YOU UNDERSTAND THE NATURE OF CHAPTER 11 IN THE UNITED STATES, BANKRUPTCY RULES, THIS IS THE GROUP THAT WILL HELP IN THE RE-FORMING OF THE ENTITY, THE RE-FORMING OF THE BALANCE SHEET, THE RE-FORMING OF HOW THIS ORGANIZATION SHOULD GO FORWARD. THE EMERGENCY NAMES AND ADDRESSING COMMITTEE IS DESIGNED TO BE INTERNATIONALLY REPRESENTATIVE AND REPRESENTATIVE OF ALL THE STAKEHOLDERS. SO IT CONSISTS OF ONE GAC REPRESENTATIVE FROM EACH REGION, SO FIVE GOVERNMENT REPRESENTATIVES FROM AROUND THE WORLD; ONE APPOINTED REPRESENTATIVE OF EACH OF THE GNSO CONSTITUENCIES; ONE APPOINTED REPRESENTATIVE OF THE ALAC, CONSUMER INTERESTS FROM EACH REGION AROUND THE WORLD, SO FIVE OF THOSE; TWO APPOINTED REPRESENTATIVES OF THE ADDRESS SUPPORTING ORGANIZATION, ONE CC REPRESENTATIVE FROM EACH REGION. ONE ROOT SERVER OPERATOR, ONE REPRESENTATIVE FROM ICANN'S TECHNICAL LIAISON GROUP; THE SSAC CHAIR, AND TWO SSAC MEMBERS; AND ONE REPRESENTATIVE FROM THE INTERNET ARCHITECTURE BOARD. SO IT'S SUPPOSED TO BE AN INTERNATIONAL GROUP REPRESENTING GOVERNMENTS, TECHNICAL COMMUNITY, CC'S, ALL THE CONSTITUENCIES FROM AROUND THE WORLD WHO WILL BE GIVING ADVICE AS TO WHAT SHOULD HAPPEN NEXT. A COUPLE OF KEY POINTS. YOU WILL NOTICE THAT THERE IS NO SPECIAL RESERVE POSITION FOR A MEMBER OF THE UNITED STATES GOVERNMENT. THERE IS NO SPECIAL RESERVE PLACE FOR THE USG. THERE ARE, I THINK, FIVE OR SEVEN COUNTRIES IN ICANN'S NORTH AMERICAN REGION. THE UNITED STATES MIGHT BE ONE OF THOSE IN THE GAC GROUPING FOR NORTH AMERICA; IT MAY NOT. SO THERE IS NO SPECIAL PLACE FOR THE UNITED STATES GOVERNMENT. IMPORTANTLY, THIS IS FULLY REPRESENTATIVE OF BOTH THE INTERNATIONAL MULTISTAKEHOLDER MODEL. THE IMPORTANCE OF THE EXECUTIVE STABILITY COMMITTEE IS, THEY, ARE THE PEOPLE WHO HAVE TO ENSURE THE DAILY OPERATIONS WORK AND WE DON'T END UP WITH LOG JAMS. THE ENAC IS REPRESENTATIVE, BUT IF WE WERE TO PUT EXECUTIVE FUNCTIONS PURELY THIS THEIR HANDS, WE COULD END UP WITH DELAYS ABOUT MAKING CHANGES TO SERVERS OR PUTTING ELECTRICITY ON. SO IT'S A TWO-PART FUNCTION.

I'D LIKE TO MAKE THE POINT WHICH WAS MADE, I THINK, ALSO IN THE GAC MEETING THAT IT WAS ACTUALLY THE DEPARTMENT OF COMMERCE WHO MADE RECOMMENDATIONS TO US ABOUT THE INTERNATIONAL AND MULTISTAKEHOLDER NATURE OF THIS REPRESENTATION. SO THEY WERE VERY CONCERNED AND PUT IT TO US THAT WE SHOULD ACTUALLY MAKE SUCH A MODEL AND THAT THE MODEL SHOULD BE AS INTERNATIONAL AS IT IS. I'M INTERESTED, AND YOU MIGHT HAVE SEEN ON MONDAY OR TUESDAY OF THIS WEEK THAT MIKE GALLAGHER, THE ASSISTANT SECRETARY OF COMMERCE FOR COMMUNICATIONS AND INFORMATION, MAKING COMMENTS ON THE COMPLETION OF THOSE SEVEN STEPS AND THE MILESTONES, MADE THE FOLLOWING COMMENT WHICH YOU CAN SEE ON THE SCREEN. I'M PLEASED THAT ICANN HAS TIMELY MET THE MOU MILESTONES TO DATE. CLEARLY MORE WORK REMAINS TO COMPLETE THOSE MILESTONES. WE LOOK FORWARD TO CONTINUING TO WORK COLLABORATIVELY WITH ICANN TO COMPLETE THE REMAINING TASKS OVER THE COURSE OF THE MOU AS WE COMPLETE THE TRANSITION TO INDEPENDENT, PRIVATE-SECTOR MANAGEMENT OF THE INTERNET DOMAIN NAME SYSTEM. SO I THINK FOR THOSE WHO ARE INTERESTED IN THE INTENTIONS OF THE UNITED STATES GOVERNMENT WHEN IT COMES TO ICANN, THE NATURE OF THE CONTINGENCY PLANNING AND THE PUBLIC STATEMENTS OF SENIOR OFFICIALS, I THINK, INDICATE THEIR INTENTIONS. THE CCNSO HAS MADE IN THE LAST -- DURING THIS MEETING THE COMPLETION OF THE CCNSO HAS TAKEN PLACE BETWEEN ROME AND HERE IN KUALA LUMPUR. THERE ARE OVER 40 MEMBERS. THE ELECTIONS TO THE CCNSO COUNCIL HAVE BEEN COMPLETED, AND THE WORK OF THE CCNSO LAUNCHING GROUP HAS BEEN COMPLETED. AND WITH THE FIRST COUNCIL MEETING TOOK PLACE HERE IN KL, WE WILL HEAR MORE FROM THEM LATER TODAY. BUT I WOULD JUST LIKE TO SAY CONGRATULATIONS TO THOSE PEOPLE. CONGRATULATIONS TO THE FORMATION OF THE CCNSO. AND CERTAINLY FROM THE BOARD LEVEL. (APPLAUSE.)

>>PAUL TWOMEY: THERE ARE ISSUES BEING DISCUSSED IN THE GTLD BOARD. WE WILL HEAR MORE ABOUT THIS TODAY, BUT THE ISSUES SUCH AS WHOIS, THE LAUNCH OF THE INTER-REGISTRAR TRANSFERS POLICY HAS BEEN ACHIEVED. MORE POLICY ON DELETES. ALSO ON THE PROCEDURES FOR DESIGNATION OF THE SUBSEQUENT DOT NET REGISTRY OPERATOR. WE'LL HEAR MORE ABOUT THAT TODAY.

ONE OF THE TASKS THAT WE REQUIRED TO DO IN THIS NEXT COMING SIX MONTHS IS WORK THROUGH A PROCESS OR DEVELOP A PROCESS FOR HOW WE SHOULD CONSIDER THE QUESTIONS OF INTRODUCTION OF NEW GTLDS, IF THAT IS APPROPRIATE. AND IN TUNIS, THE BOARD RECOMMENDED -- THE BOARD RESOLVED THAT SOME INITIAL WORK BE DONE, BE TASKED FOR INPUT TOWARDS THAT CONSIDERATION. ONE IS SOME WORK TO BE DONE BY AN INTERNATIONAL ECONOMICS ORGANIZATION ON THE ECONOMICS OF THE GTLD MARKETPLACE. ONE WAS SOME WORK TO BE DONE BY WIPO, SOME OTHER WORK WAS TO BE DONE BY THE RSSAC, AND THE OECD HAS COMPLETED ITS REPORT, AND MANY OF YOU SHOULD HAVE RECEIVED A COPY OF THAT AT REGISTRATION. MUCH OF THE ATTENTION OF THAT WORK WAS ON THE RECOMMENDATIONS ABOUT THE POSSIBLE USE OF AUCTIONS AS A WAY OF ALLOCATING NEW GTLDS OR FINANCIAL MEASURES FOR ALLOCATING. I WON'T MAKE A COMMENT ON THAT. I'LL LEAVE IT FOR THE COMMUNITY TO READ FURTHER, BUT AS SAM (INAUDIBLE) MADE CLEAR IN HIS GTLD PRESENTATION, MADE CLEAR TO ME THE IMPORTANT PART OF THEIR REPORT WAS THE FIRST SEVERAL CHAPTERS OF IT ACTUALLY ANALYZING THE HISTORY OF ICANN AND ANALYZING WHETHER, AS AN INTERNATIONAL MULTI-STAKEHOLDER MODEL IT HAD BEEN EFFECTIVE IN ADDRESSING CERTAIN KEY INTERNATIONAL ECONOMIC REQUIREMENTS. AND I THOUGHT I'D JUST LET YOU READ THROUGH A COUPLE OF THE QUOTES HERE BECAUSE WE SHOULD ACTUALLY LISTEN TO THIS VERY CAREFULLY. THIS IS AN ORGANIZATION OF SOME 34 GOVERNMENTS, I THINK IT IS. SPECIFICALLY DIRECTED TOWARDS, IF YOU LIKE, GOOD ECONOMICS. THERE'S GOOD ECONOMIC POLICY BEING FOLLOWED. AND THE CONCLUSION OF THE PAPER IS THAT ICANN'S REFORM OF THE MARKET STRUCTURE FOR THE REGISTRATION OF GENERIC TOP-LEVEL DOMAINS HAS BEEN VERY SUCCESSFUL. THE DIVISION BETWEEN REGISTRY AND REGISTRAR FUNCTIONS HAS CREATED A COMPETITIVE MARKET THAT HAS LOWERED PRICES AND ENCOURAGED INNOVATION. THE INITIAL EXPERIENCE WITH COMPETITION AT THE REGISTRY LEVEL IN ASSOCIATION WITH A SUCCESSFUL PROCESS TO INTRODUCE NEW GTLDS HAS ALSO SHOWN POSITIVE RESULTS. ANOTHER PLACE, IT FURTHER GOES, "TRADITIONALLY, THE REGISTRATION OF DOMAIN NAMES WAS A ONE DIMENSIONAL SERVICE. THE OPENING OF THE GTLD REGISTRAR MARKET HAS, HOWEVER, BROUGHT TREMENDOUS INNOVATION IN TERMS OF NEW SERVICES AND SEAMLESSLY LINKED VALUE ADDED IN TERMS OF REGISTRATION." AND ONE OF THE FINAL ONES I'LL DRAW YOUR ATTENTION TO, "WHEN OECD COUNTRIES ALLOCATE RESOURCES THEY HAVE CERTAIN COMMON OBJECTIVES IRRESPECTIVE OF THE METHOD CHOSEN OF THESE CAN INCLUDE EFFICIENT ALLOCATION OF A RESOURCE AND EFFICIENT USE OF THAT RESOURCE, TRANSPARENCY IN THE AWARD OF RESOURCE, NONDISCRIMINATION, AND THE CREATION OF APPROPRIATE CONDITIONS FOR MARKET COMPETITION. THERE MAY ALSO BE OTHER WIDER ECONOMIC AND SOCIAL OBJECTIVES. THROUGH STATEMENTS AND ACTIONS, IT IS CLEAR THAT ICANN SHARES THE IDEALS AND INHERENT IN THESE OBJECTIVES." SO I JUST THOUGHT YOU SHOULD ALL CONGRATULATE YOURSELVES, AMONGST THE NOISE, AMONGST TENSION, THE JOSTLING TO AND FROM IN THE LAST YEARS ABOUT THIS WHOLE MARKETPLACE, AN INDEPENDENT, THIRD GROUP HAVE HAD A REVIEW, DONE A REPORT CARD, IF YOU LIKE. AND I THINK THAT'S NOT A BAD REPORT CARD FOR THE COMMUNITY ABOUT WHAT WE'VE MANAGED TO ACHIEVE IN THE LAST FOUR OR FIVE YEARS. SOME ORGANIZATIONAL MATTERS. WE'RE IN THE PROCESS OF RECRUITING SOME KEY STAFF. I WILL DRAW PEOPLE'S ATTENTION HERE TO THE WONDERFUL SCREENS OUTSIDE WHICH ARE SCROLLING THROUGH. THERE ARE QUITE A NUMBER OF JOB POSITIONS THAT WE'RE LOOKING FOR. WE'RE PARTICULARLY LOOKING FOR CANDIDATES FROM THE ASIA-PACIFIC, SO WE HOPE PEOPLE WILL LOOK AT THOSE JOBS EITHER ON THE WEB SITE OR ON THE SCREENS. AND IF YOU'VE GOT AN INTEREST, PLEASE LET US KNOW. THERE IS A NEW BUDGET UNDER CONSIDERATION, WHICH THE FINANCE COMMITTEE AND THE ADVICE PRESIDENT OF BUSINESS OPERATIONS WILL SPEAK MORE LATER. WE'RE ALSO IN THE FINAL STAGES OF AN APPOINTMENT OF THE OMBUDSMAN POSITION. CANDIDATES HAVE BEEN INTERVIEWED. THERE ARE SOME OTHER ISSUES WHICH WILL BE DISCUSSED BY THE BOARD TOMORROW BUT WE ARE VERY CLOSE TO HAVING THE OMBUDSMAN SITUATION FINALIZED. WE ALSO NOTE THAT THE AFRINIC DEVELOPMENTS HAVE CONTINUED. THE PROCESS OF SETTING UP AFRINIC WAS STARTED IN 2000. THE EMERGING RIR HAS KEPT US ABREAST OF ITS PROGRESS AND WE'RE HAPPY TO HEAR AN UPDATE FROM THEM TODAY. AND I THINK I CAN SPEAK ON BEHALF OF THE STAR AND BOARD THAT WE ARE COMMITTED TO HELPING IT BECOME A FULL OPERATIONAL RIR WITH THE DUE PROCESS. SOME OF THE OTHER ONGOING WORK, EXAMPLES IS THE COMMUNICATION OUTREACH WORK, AND FURTHER DEVELOPMENT OF MATERIALS, YOU'LL SEE ANOTHER STEP-UP IN THE MATERIALS WHICH ICANN PRODUCES IN TERMS OF THE NEWSLETTER. WE ARE LOOKING TO TURN THAT NEWSLETTER, WITH YOUR AGREEMENT, INDIVIDUALLY WITH YOUR AGREEMENT, FROM BEING A PAPER VERSION TO MOVING TO AN ELECTRONIC VERSION. AND WE'D LIKE TO MOVE, BETWEEN NOW AND CAPE TOWN, TO START SENDING MEMBERS OF THE ICANN COMMUNITY ELECTRONIC UPDATES, IF YOU LIKE. WE'RE CONSCIOUS THAT WE PUT A LOT OF INFORMATION ON OUR WEB SITE, BUT MANY OF YOU HAVE BETTER THINGS TO DO DURING DATA THAN GO TO THE ICANN WEB SITE, SO WE THOUGHT WE WOULD BE MOVING TOWARDS HAVING BRIEF ELECTRONIC BULLETINS TO UPDATE YOU ON THINGS TAKING PLACE OR CHANGES THAT HAVE OCCURRED. THE NOMINATING COMMITTEE HAS BEGUN ITS WORK, AND CALLS FOR NOMINATION ARE UNDER WAY AND WE WILL HAVE A PRESENTATION FROM THE NOMINATION COMMITTEE CHAIR LATER TODAY. THERE ARE, OF COURSE, LITIGATION MATTERS, WE CONTINUE TO BE IN LITIGATION. THE SPONSORED TOP-LEVEL DOMAIN PROCESS IS STILL UNDER WAY AND GOING THROUGH EVALUATION. WE'LL HAVE A REPORT TODAY. AND WE'LL ALSO HAVE A REPORT FROM THE AT-LARGE ADVISORY COMMITTEE. SO BOARD, THANK YOU VERY MUCH.

>>VINT CERF: THANK YOU VERY MUCH, PAUL.

(APPLAUSE.)

>>VINT CERF: THERE WILL BE OPPORTUNITY FOR PUBLIC COMMENT AND QUESTION AFTER WE'VE COMPLETED THE NEXT ITEM ON THE AGENDA, WHICH IS THE REPORT ON THE BUDGET -- I'M SORRY, PAUL?

>>PAUL TWOMEY: I WONDER IF I CAN SAY ONE OTHER THING, VINT. I SHOULD ALSO SAY THAT CERTAINLY FROM THE STAFF PERSPECTIVE, WE HAVE BEEN ABSOLUTELY DELIGHTED WITH THE ASSISTANCE AND THE HELP AND THE PLANNING BY THE PLANNING COMMITTEE AND THE HOST COMMITTEE HERE IN KUALA LUMPUR. IT'S BEEN A MAGNIFICENT EFFORT. WE'VE BEEN EXCEPTIONALLY PLEASED.

MY BAROMETER IS WHETHER THOSE PEOPLE OVER THERE ARE HAPPY AND IN THE MORNING WHETHER THEY'RE SCOWLING OR HAVE SMILES ON THEIR FACES. THEY HAVE HAD SMILES EVERY DAY I'VE BEEN HERE. IT'S BEEN A MAGNIFICENT JOB AND I WOULD LIKE TO THANK THE HOST COMMITTEE, THE GOVERNMENT OF MALAYSIA, SHARIL AND OTHERS FOR THAT (APPLAUSE.)

>>VINT CERF: WE HOPE WE'LL HAVE OPPORTUNITY TO EXPRESS OUR APPRECIATION FURTHER TOMORROW AT THE BOARD MEETING.

I'D LIKE TO CALL ON KURT PRITZ NOW TO PRESENT THE CURRENT BUDGET STATE OF AFFAIRS.

>>PAUL TWOMEY:CHAIRMAN, I THINK THE AGENDA WOULD CALL FOR THE FINANCE COMMITTEE TO REPORT BEFORE THE VICE PRESIDENT.

>>VINT CERF: I'M SORRY; WHAT I'VE DONE HERE IS COMPLETELY SKIP OVER THE AUDIT COMMITTEE, THE BOARD GOVERNANCE COMMITTEE AND THE MEETING COMMITTEE AND THE FINANCE COMMITTEE

(LAUGHTER.)

>>VINT CERF: OUR GUYS BACK HERE MAY BE SMILING AND MY BRAIN IS JUST NOT FUNCTIONING. MY APOLOGIES. KURT, YOU CAN BE SEATED AND I'LL CALL ON NJERI RIONGE TO PRESENT THE AUDIT COMMITTEE REPORT. NJERI.

>>NJERI RIONGE: THANK YOU, CHAIRMAN. I'LL JUST PROCEED BY READING THE REPORT TO YOU.

THE AUDIT COMMITTEE REPORT FOR JULY 2004, AND THE MEMBERS ARE RAIMUNDO BECA, WHO HAS JOINED US DURING THIS MEETING, VENI MARKOVSKI, THOMAS NILES, AND NJERI RIONGE, THE CHAIR. THE AUDIT COMMITTEE HAS REVIEWED THE ACTION POINTS AND SUGGESTIONS EMERGING FROM THE LAST MEETING HELD IN ROME, ITALY IN MARCH 2004. WE HAVE REVIEWED THE ACTION POINTS OF OUR PREVIOUS MEETING AND UPDATED THE SCHEDULES FOR THE DELIVERABLES, WITH DEFINITE TIME LINES IN ORDER TO MEET THE REQUIREMENTS OF ICANN'S BYLAWS BY THE CLOSE OF MEETING IN CAPE TOWN, SOUTH AFRICA AS FOLLOWS. THE CALL FOR PROPOSAL WAS ISSUED AND WE ARE CURRENTLY WAITING FOR RESPONSES FROM POTENTIAL AUDITORS. THE COMMITTEE WILL REVIEW THE FINDINGS AND RECOMMEND TO THE BOARD SUCCESSFUL SHORT LISTED CANDIDATES FOR THE BOARD TO APPOINT BY THE AUDITOR BY THE NEXT MEETING IN CAPE TOWN. THE PREPARATION OF THE FINANCIAL AUDIT FOR YEAR 2003-2004 IS ON SCHEDULE AS REQUIRED BY THE ICANN BYLAWS. WE WILL REVIEW THE DRAFT AND THE FINAL FINANCIAL STATEMENT WITHIN THE 120-DAY FRAMEWORK, AND FORWARD THEM TO THE BOARD FOR APPROVAL NO LATER THAN SEPTEMBER 30TH, 2004. THE BOARD WILL REVIEW AND ADOPT THE FINANCIAL STATEMENT OF ACCOUNTS DURING THE FOLLOWING BOARD SCHEDULED CALL, SCHEDULED FOR OCTOBER 19TH, 2004. AS NOTED IN THE COMMITTEE'S LAST REPORT, WE ARE RETAINING THE CURRENT AUDITOR, KPMG, FOR ICANN'S FINANCIAL YEAR 2003-2004 ACCOUNTS. AN ANALYSIS OF ICANN'S RISK MANAGEMENT PROCESS HAS BEEN ONGOING FOR THE LAST FOUR MONTHS, AND A CONTINGENCY PLAN FOR BUSINESS CONTINUITY IS IN THE FINAL REVIEW PROCESS. IN ADDITION, THE INTRODUCTION OF THE FINANCIAL CONTROL SYSTEMS AND INSTALLATION OF THE NEW FINANCIAL SOFTWARE ARE CURRENTLY UNDERWAY. AS MENTIONED IN OUR LAST REPORT, WE ARE COMMITTED TO THE COMPLETION OF THESE PROCESSES BY DECEMBER 2004. IN VIEW OF THE IMPORTANCE OF THESE PROJECTS, MEMBERS OF THE COMMITTEE WILL VISIT ICANN'S MARINA DEL REY OFFICES DURING OCTOBER 2004 TO DO THE FOLLOWING. CONDUCT AN OFFICIAL SITE AUDIT OF THE FINANCIAL MANAGEMENT CONTROL SYSTEM, MEET FORMALLY WITH THE CURRENT AUDITORS BEFORE THE FINAL FINANCIAL STATEMENT GOES TO THE BOARD FOR ITS APPROVAL; OBTAIN A COMPLETE REPORT FROM THE AUDITORS WHICH WILL FACILITATE THE INSTALLATION OF A FINANCIAL MANAGEMENT SYSTEM. INTERVIEW THE SHORT-LISTED AUDITORS BEFORE MAKING A RECOMMENDATION TO THE BOARD. AND FACILITATE ASSISTANCE WHERE NECESSARY TO THE FINANCIAL TEAM REGARDING THE KEY RESULT AREAS AND THE KEY PERFORMANCE INDICATORS. IT IS THE COMMITTEE'S INTENTION TO MEET OUR CURRENT DEADLINE OF JANUARY 2005 BY FORWARDING THE FINAL ADJUSTMENTS IN THE FINANCIAL STATEMENT, POLICY, ALONG WITH THE RECOMMENDATION OF THE AUDITORS FOR FISCAL 2004-2005 BY DECEMBER 2004 TO THE BOARD FOR REVIEW AND ADOPTION. THE COMMITTEE IS COMMITTED TO MEETING THE ACTION PLANS FOR THIS YEAR 2004-2005, WHICH WE BELIEVE WILL OFFER ICANN BOARD, STAFF, COMMUNITY AT LARGE AND THE NECESSARY SUPPORT, AS PER THE ICANN BYLAWS. THANK YOU VERY MUCH.

>>VINT CERF: THANK YOU, NJERI. I NOTED ONE SMALL TYPOGRAPHICAL ERROR. SOMEWHERE IN THE EARLY PART OF THE TEXT IT MENTIONS THAT THE BOARD WILL "ADAPT" THE REPORT. I SUSPECT WE MEANT ADOPT. IF WE ADAPT IT, THAT PROBABLY CONSTITUTES SOME ODD FORM OF ACCOUNTING AND WE'LL ALL BE IN JAIL.

>>NJERI RIONGE: SORRY. THANKS.

>>VINT CERF: THE NEXT REPORT -- SORRY?

THE NEXT REPORT COMES FROM ALEJANDRO PISANTY IN HIS ROLE AS CHAIRMAN OF THE BOARD GOVERNANCE COMMITTEE. BRIEF PAUSE WHILE MR. GATES DOES HIS THING.

>>ALEJANDRO PISANTY: GOOD MORNING FELLOW BOARD MEMBERS, CHAIRMAN, AUDIENCE. THE BOARD GOVERNANCE COMMITTEE HAS MET BY TELECONFERENCE SEVERAL TIMES, THROUGH E-MAIL AND EXCHANGE OF DRAFT DOCUMENTS AND HELD A PHYSICAL MEETING IN KUALA LUMPUR WHICH WAS ATTENDED BY ALL MEMBERS OF THE COMMITTEE.

THE BOARD GOVERNANCE COMMITTEE HAS FINISHED A DRAFT OF GOVERNANCE AND CONDUCT GUIDELINES FOR THE BOARD, WHICH --

>>VINT CERF: REMEMBER, THEY'RE TYPING.

>>ALEJANDRO PISANTY: YES.

>>ALEJANDRO PISANTY: THE -- I'LL START AGAIN THIS PART.

THE BOARD GOVERNANCE COMMITTEE HAS FINISHED A DRAFT OF GOVERNANCE AND CONDUCT GUIDELINES FOR THE BOARD AND RELATIONSHIPS BETWEEN BOARD AND STAFF, WHICH IS READY TO CIRCULATE AMONG THE FULL BOARD. IT HAS BEEN SIGNED OFF NOW BY THE COMMITTEE. RESPECTING THE IMPORTANCE OF THE SUBJECT AND THE ALREADY FULL AGENDA FOR THE MEETINGS IN KUALA LUMPUR, WE HAVE DECIDED TO CIRCULATE THE DOCUMENT TO THE FULL BOARD STARTING NEXT MONDAY. SO FOR DISCUSSION, FURTHER ELABORATION, AND ITS POSSIBLE ACCEPTANCE. THE BOARD GOVERNANCE COMMITTEE HAS FULFILLED ITS TASK OF PROPOSING TO THE BOARD COMPILATION OF COMMITTEES. THIS WILL BE PRESENTED LATER TODAY BECAUSE WE STILL HAVE TO DISCUSS WITH THE BOARD MEMBERS THE POSITIONS THAT WE ARE PROPOSING. IT'S A MINOR CHANGE. IT WILL BE PUT FORWARD FOR BOARD RESOLUTION TOMORROW AT THE BOARD MEETING. THE BOARD GOVERNANCE COMMITTEE PROPOSED TO THE BOARD FOR RESOLUTION THAT DESIGNATION OF A MEMBER OF THE NOMINATING COMMITTEE FOR THE ACADEMIC COMMUNITY IN COMPLIANCE WITH THE BYLAWS. AFTER A PROCESS OF CONSULTATION WITH A NUMBER OF REPRESENTATIVES OF NATIONAL RESEARCH AND EDUCATION NETWORKS WELL ACQUAINTED WITH ICANN, THE COMMITTEE HAD A RICH CHOICE OF CANDIDATES, AMONG WHICH WAS SELECTED PROFESSOR GEORGE MCLAUGHLIN WHO IS A LEADER OF NETWORKS IN (INAUDIBLE), THAT'S REUNA AND DANTE, WE THANK THEM FOR THE HARD WORK THEY DID IN PROPOSING CANDIDATES AND TO ALL THOSE WE CONTACTED. AND WE ARE ALSO GRATEFUL TO DR. OBLINGER FOR HER AND HER ORGANIZATION'S FAVORABLE DISPOSITION IN THIS PROCESS. FINALLY, THE COMMITTEE WISHES TO EXPRESS ITS THANKS TO JOHN JEFFREY, KURT PRITZ AND PAUL TWOMEY WITHOUT WHOSE ATTENTION AND ASSISTANCE OUR TASK WOULD HARDLY HAVE BEEN ACHIEVED.

>>VINT CERF: THANK YOU VERY MUCH. THAT'S A VERY POSITIVE AND CONSTRUCTIVE REPORT. THE NEXT REPORT COMES FROM VENI MARKOVSKI WHO IS CHAIRMAN OF THE MEETINGS COMMITTEE WITH INFORMATION ON WHERE WE ARE WITH REGARD TO FURTHER MEETINGS.

>>VENI MARKOVSKI: THANK YOU.

WE HAVE HAD A MEETING IN KUALA LUMPUR WITH ALL MEMBERS OF THE MEETINGS COMMITTEE. AND HERE IS A SUMMARY OF THE DISCUSSION THAT WE MADE. FIRST OF ALL, WE WANT TO THANK TO EVERYONE WHO SENT PROPOSALS FOR THE MEETINGS IN 2005, 2006, 2007. WE HAVE PRETTY GOOD VARIETY OF CHOICES, AND IN ORDER TO ESTABLISH WHERE EXACTLY AND IN WHAT CONDITIONS TO HAVE MEETINGS, ESPECIALLY THAT WE HAVE FACED IN KUALA LUMPUR SOMETHING WHICH WE HAVE NEVER SEEN BEFORE, THAT IT'S A PERFECT VENUE AND A PERFECT ORGANIZATION AND A PERFECT SHARIL AS A HOST, FOR WHICH WE WILL HAVE A SPECIAL THANK YOU NOTE TOMORROW.

WE ARE GOING TO SEND JOHN (INAUDIBLE) AND MICHAEL EVANS TO ARGENTINA FOR THE MARCH 2005. WE NEED TO HAVE A SIDE REPORT TO THE COMMITTEE PENDING ANY ISSUES THAT MIGHT ARISE DURING THE SITE VISIT, THE COMMITTEE WILL ADVISE THE CEO TO -- WHETHER TO ACCEPT AND HOW TO ACCEPT THE PROPOSAL AND TO PROPOSE IT TO THE BOARD. FOR THE JULY 2005, MICHAEL EVANS WILL BE TRAVELING TO LUXEMBOURG AS SOON AS POSSIBLE. THAT BASICALLY MEANS IN THE NEXT FEW WEEKS. WE ALSO NEED TO HAVE A SITE REPORT FOR THE COMMITTEE. FOR THE DECEMBER 2005, WE HAVE TAKEN NO DECISION AT THIS TIME. WE NEED TO MAKE FURTHER RESEARCHES ON THE PROPOSALS, AND WE ALSO NEED TO HAVE SITE VISITS ON BOTH CANDIDATES CITIES. AND WE ALSO NEED TO HAVE SITE VISITS FOR THE 2006 PROPOSALS BECAUSE THERE ARE TOO MANY -- THERE ARE MORE THAN ONE PROPOSAL FOR THE DIFFERENT MONTHS OR THE DIFFERENT MEETINGS, AND WE JUST -- WE JUST REALLY HAVE TO TAKE INTO CONSIDERATION ALL THE GOOD AND POSITIVE LESSONS WE HAVE GAINED FROM THE KUALA LUMPUR MEETING. AND FRANKLY SPEAKING, I THINK THAT WE HAVE A THANKFUL NOTE FOR SHARIL AND THE HOSTS HERE. WE HAVE TO MAKE A SPECIAL NOTE FOR THE FUTURE, CITIES TO HOST ICANN MEETINGS, THAT THEY SHOULD NOT RAISE THE BAR SO HIGH THAT WE HAVE TO SOMEHOW FIND A SOLUTION FOR THE NEXT MEETINGS, YOU KNOW. OTHERWISE, WE MAY END UP HAVING MEETINGS ONLY IN KUALA LUMPUR. (LAUGHTER.)

>>VENI MARKOVSKI: AFTER 2006.

SO THIS IS THE MESSAGE THAT WE HAVE FOR THE ICANN INTERESTED PARTIES. AND WE HOPE TO BE ABLE TO FINALLY OKAY THE MEETINGS IN 2005 IN THE BOARD MEETINGS EITHER IN AUGUST OR SEPTEMBER OVER THE TELEPHONE CONFERENCE CALLS. THANK YOU.

>>VINT CERF: THANK YOU VERY MUCH, VENI. SO I SEE WE CAN LOOK FORWARD TO SOME VERY INTERESTING AND, I THINK, VERY BENEFICIAL VENUES FOR FUTURE MEETINGS.

I'D LIKE TO NOW CALL ON THE CHAIRMAN OF THE FINANCE COMMITTEE, IVAN CAMPOS, TO MAKE HIS REPORT.

>>IVAN MOURA CAMPOS: THANK YOU, VINT.

MAY I HAVE THE NEXT SLIDE, MARK, PLEASE. THE FINANCE COMMITTEE MEMBERS ARE MYSELF, TRICIA DRAKES, HAGEN HULTZSCH, TOM NILES AND MIKE PALAGE. AFTER ROME, WE HAD THESE TELECONFERENCES AND NUMEROUS PHONE CALLS AND WHAT HAVE YOU, AND WE HAD ON THE 20TH OF JULY, THIS WEEK WE HAD A MEETING WITH THE BUDGET ADVISORY GROUP, AND YET ANOTHER FACE TO FACE MEETING ON THE 21ST OF JULY. SO THIS GIVES YOU AN IDEA OF THE ACTIVITY. THE ISSUES DISCUSSED, NOT SURPRISINGLY, ARE THE CURRENT BUDGET EXECUTION AND THE FOLLOW-UP OF ITS EXECUTION. AND ALSO DISCUSSIONS ON THE PROPOSED BUDGET, AND GETTING UPDATES AND FEEDBACK TO STAFF ON NEGOTIATIONS WITH THE VARIOUS CONSTITUENCIES. NEXT, PLEASE. AND WE HAVE THE FOLLOWING COMMENTS TO SHARE WITH YOU. OVER AN EXTENDED PERIOD, THROUGH INITIAL TELEPHONE CONFERENCES AS WELL AS IN PERSONAL MEETINGS, THE FINANCE COMMITTEE CAREFULLY EVALUATED ICANN'S TASKS AND THE RESULTING RESOURCE NEEDS, AS REFLECTED IN THE CORRESPONDING BUDGET NUMBERS. OUR CONSISTENT OBJECTIVE WAS THE DEVELOPMENT OF A BUDGET THAT PERMITS THE ACHIEVEMENT OF ICANN'S GOALS AT THE LOWEST POSSIBLE FUNDING LEVEL. WE BELIEVE THAT THE PROPOSED BUDGET SATISFIES THOSE OBJECTIVES. NEXT, PLEASE. ALSO, THE FINANCIAL COMMITTEE VOTED TO RECOMMEND TO THE BOARD THE ADOPTION OF THE PROPOSED BUDGET, AND TO KEEP ASSISTING THE CEO AND STAFF IN THE CONTINUING DIALOGUE WITH STAKEHOLDERS IN ORDER TO REACH CLOSURE ON THE OUTSTANDING DETAILS OF THE REVENUE MODEL. NEXT, PLEASE. AND FINALLY, IN EVALUATING THE DRAFT BUDGET'S PROPOSED EXPENDITURES AND REVENUES, THE COMMITTEE RECOGNIZED THAT THE INCREASING DEMANDS PLACED ON ICANN BY ITS VARIOUS CONSTITUENCIES, AS WELL AS THE WORK REQUIRED TO COMPLETE THE TASKS IN THE CURRENT AND FINAL MOU WITH THE USDOC NECESSITATED THE SUBSTANTIAL INCREASES ENVISAGED. IN THIS WORK, THE COMMITTEE HAD -- ALSO HAD TO TAKE INTO ACCOUNT THE DYSFUNCTIONAL ASPECTS OF ICANN'S CURRENT FUNDING STRUCTURE WHICH IT HOPES CAN BE OVERCOME, AND THE UNFORTUNATE NECESSITY ICANN FACES TO DEFEND INTEGRITY AND STABILITY OF VARIOUS ACTIONS. THANK YOU, MR. CHAIRMAN.

>>VINT CERF: THANK YOU VERY MUCH. NOW, IF I'M READING MY NOTES CORRECTLY I CAN CALL ON KURT PRITZ TO PRESENT THE PROPOSED BUDGET FOR 2004-2005 WHICH THE FINANCE COMMITTEE IS RECOMMENDING.

>>KURT PRITZ: THIS UPCOMING YEAR'S PROPOSED BUDGET DOES A FEW THINGS. IT PROVIDES RESOURCES THAT ICANN NEEDS TO ACCOMPLISH THINGS THAT NEED TO BE ACCOMPLISHED. IT WAS ALSO BORNE OUT OF AN EXTENSIVE AMOUNT OF COLLABORATION BETWEEN ICANN STAFF, THE BOARD, AND THE VARIOUS CONSTITUENCIES IN THE INTERNET COMMUNITY. AND FINALLY, IT SETS A LONGER TERM LOOK IN THE OUT YEARS BEYOND THIS YEAR TO MANAGE THE EXPECTATIONS OF THE COMMUNITY WITH REGARD TO WHAT ICANN'S GOALS ARE AND WHAT THE FEES THE COMMUNITY MIGHT PAY ARE.

THERE ARE FIVE SIGNIFICANT ASPECTS TO THIS BUDGET. ONE IS THE BUDGET DEVELOPMENT PROCESS THAT OCCURRED INSIDE ICANN, HOW THAT BUDGET WAS BUILT UP. SECOND WAS THE FORMULATION OF ICANN'S GOALS AND OBJECTIVES FOR THE YEAR, AND THE SOURCES OF THOSE GOALS AND OBJECTIVES. AFTER THAT, THERE WAS EXTENSIVE COLLABORATION WITH THE COMMUNITY, AND AS A RESULT, THERE WAS SIGNIFICANT CHANGE TO THE BUDGET, BOTH ON THE REVENUE AND EXPENSE SIDE IN A WAY THAT I BELIEVE IS VERY POSITIVE. FOURTH, WE'RE DEVELOPING NEW REVENUE STRUCTURES. IN THE SHORT TERM, WE'RE LOOKING TO MATCH THE REGISTRARS RISK WITH ICANN'S RISK AS FAR AS FUTURE REVENUE GOES AND PROPOSE A FAIRER FEE COLLECTION METHOD FROM GTLD REGISTRARS. IN THE LONGER TERM, WE'RE LOOKING TO LIGHTEN THE LOAD OF THOSE GTLD REGISTRARS BY GROWING ALTERNATIVE SOURCES OF FUNDING THAT WE THINK ARE REQUIRED FOR ICANN'S LONG-TERM HEALTH AND STABILITY. AND FINALLY, LIKE I SAID, WE LOOK A LITTLE BIT TO THE LONG TERM TO FORECAST FUTURE FEES AND GOALS. THE ICANN DEVELOPMENT PROCESS THIS YEAR WAS SOMEWHAT DIFFERENT. WE'VE CREATED SEVEN DEPARTMENTS WITHIN ICANN, AND ASKED EACH DEPARTMENTAL MANAGER TO BUILD UP A BUDGET FOR HIS DEPARTMENTAL GROUP, GIVEN THE GOALS AND OBJECTIVES HE HAS FOR THE YEAR. SO FROM A MANAGER'S STANDPOINT THIS IS A REALLY GOOD THING FOR ME BECAUSE I NOT ONLY GET TO THE MANAGER TO BUILD HIS BUDGET UP BUT THEN I ALSO HAVE A TOOL BY WHICH TO MANAGE THAT DEPARTMENT HEAD. AND I HAVE FREQUENT CONVERSATIONS WITH PAUL TWOMEY ABOUT IMPLEMENTING ACCOUNTABILITY MECHANISMS AND RESPONSIBILITY MECHANISMS, SO THIS BUDGET IS NOT JUST ABOUT A SPENDING PLAN BUT IT'S ALSO ABOUT BUILDING TOOLS UP FOR MEASURING STAFF PERFORMANCE. IN BUILDING UP THAT BUDGET WE MATCHED THE GOALS AND OBJECTIVES OF EACH DEPARTMENT WITH THE RESOURCES NEEDED. SO THERE'S A ONE-TO-ONE CORRESPONDENCE FOR EVERY DOLLAR PAID, IT'S A ZERO SUM BUDGET WHERE EVERY DOLLAR IS EARMARKED FOR SOME EFFORT. NONETHELESS, AFTER THAT DOLLAR-FOR-DOLLAR BUILDUP, WE LOOK AT A SERIES OF MANAGEMENT REVIEWS TO MAKE SURE ALL THE SPENDING WAS DONE WISELY. AS A RESULT OF THAT, THE INITIAL BUDGET WAS SHRUNK BY ABOUT 25 PERCENT. VERY EARLY IN THE GAME WE HAD SOME CONSULTATION WITH THE COMMUNITY, SOME COMMUNITY MEMBERS, THAT ALSO LED TO SOME REDUCTIONS AND A SHIFTING OF PRIORITIES. THAT RESULTED IN SOME COMMUNITY IN-KIND CONTRIBUTIONS. A COUPLE EXAMPLES ARE THIS. WE HAD IN THE ORIGINAL BUDGET FUNDS FOR THE CONSTRUCTION AND POPULATION OF REGIONAL OFFICES, UP TO FOUR REGIONAL OFFICES IN VARIOUS REGIONS OF THE WORLD. WE WERE ABLE TO SUBSTANTIALLY REDUCE AND NEARLY ELIMINATE THE FUNDING FOR THOSE THROUGH NEGOTIATIONS WE'RE HAVING WITH GOVERNMENTS AND NONGOVERNMENTAL ORGANIZATIONS WHO ARE WILLING TO PROVIDE AID-IN-KIND IN AREAS SUCH AS STAFFING, OFFICES, AND INFRASTRUCTURE. AND ANOTHER EXAMPLE, WE HAD MONEY IN THE BUDGET TO CONSTRUCT AN IDN TEST BED SO WE COULD DO SOME TESTING REGARD THE IMPLEMENTATION OF FULL IDNS. AT THE SUGGESTION THAT THAT WASN'T REALLY OUR JOB BY SOME OF THE COMMUNITY, WE DELETED THAT FROM THE BUDGET, BUT WE HAVE A KIND OFFER OF ASSISTANCE FROM A REGISTRY TO ACT AS THE TEST BED FOR IDN IMPLEMENTATION. SO WE'RE ABLE TO MAINTAIN THOSE EFFORTS BY REDUCING THE BUDGET. SO PART OF THIS EFFORT RESULTED IN UNINTENDED BENEFITS TO US. WE DID DEVELOP MANY OBJECTIVES THAT PROVIDE BENEFIT. LET ME GO BACK. OKAY. ICANN'S GOALS AND OBJECTIVES WERE DEVELOPED FROM THREE PLACES. ONE IS THE SERVICE EXPECTED BY THE CONSTITUENCY GROUPS. THIS IS MY THIRD MEETING, AND I HOLD -- THE BEST PART OF THE MEETING IS GETTING OUT AND TALKING TO PEOPLE BECAUSE THAT'S WHAT I LIKE TO DO, AND EVERYONE HAS LEGITIMATE THOUGHTS ABOUT WHAT ICANN'S ROLE IS AND WHAT WE SHOULD BE DOING DAY-TO-DAY IN ORDER TO SUPPORT THE COMMUNITY. THOSE EXPECTATIONS ARE PERFECTLY REASONABLE. WHEN I GO BACK TO THE SHOP AND LOOK AROUND FOR A WAY TO GET THAT DONE, THERE'S NO WAY TO GET THAT DONE. SO PART OF THE BUDGET IS A BUILDUP OF THOSE EXPECTATIONS WE HEAR FROM THE COMMUNITY THAT WE WISH TO -- THAT WE WISH TO ACCOMPLISH IN ORDER TO DELIGHT OUR CONSTITUENCY GROUPS. SECONDLY, AS PAUL TWOMEY ALLUDED TO, WE HAVE THE U.S. DEPARTMENT OF COMMERCE MOU TO ACCOMPLISH. THESE ARE ESSENTIALLY BRAND-NEW EFFORTS THAT WERE NEVER WITHIN ICANN'S SCOPE BEFORE. THIS THREE-YEAR MOU CONTAINS 24 SPECIFIC DELIVERABLES, 15 OF THEM HAVE SPECIFIC DATES BY WHICH THEY ARE TO BE ACCOMPLISHED. SO THERE'S NOT AN OPPORTUNITY, REALLY, IF WE ARE GOING TO BE DECLARED INDEPENDENT OF THE DEPARTMENT OF COMMERCE TO PUSH THESE EFFORTS OUT. THEY NEED TO BE FUNDED NOW. FINALLY, THE DNS ENVIRONMENT IS GROWING AND REQUIRES MORE MANAGEMENT AND STAFF ATTENTION TO ADMINISTRATE IT. WE HAVE INCREASED NUMBER OF MARKET PARTICIPANTS, WE HAVE NEW INITIATIVES UNDER WAY FOR THE DESIGNATION OF NEW STLDS IN THE SHORT TERM AND NEW GTLDS IN THE SLIGHTLY LONGER TERM. WE WANT TO SUPPORT INNOVATIVE NEW SERVICES AND SUPPORT THE FORMATION OF THE NEW CCNSO. I WANT TO MAKE A COMMENT THAT WE WERE VERY CAREFUL THROUGH THIS WHOLE PROCESS TO MEASURE OURSELVES AGAINST THE FOUR OBJECTIVES THAT PAUL PUT UP EARLIER ON THE SCREEN IN HIS TALK AND ALL OF THESE EFFORTS LIE CLEARLY WITHIN ICANN'S ORIGINAL CHARTER AS DESCRIBED BY THE WHITE PAPER. SOME OF THESE EFFORTS THAT ARE INCLUDED IN THE BUDGET ARE THESE. NOTABLY, WE HAVE THE IMPLEMENTATION OF AN EFFECTIVE CONTRACTUAL COMPLIANCE PROGRAM. MANY CONSTITUENCY GROUPS BELIEVE ICANN SHOULD BE DOING A MUCH BETTER JOB AT THIS. WE DO IT PASSIVELY RIGHT NOW BUT WE NEED TO DO IT ACTIVELY AND WE'RE MAKING A SIGNIFICANT INVESTMENT THIS YEAR IN ORDER TO DO THAT. WE WANT TO FACILITATE THE INTRODUCTION OF INNOVATION, AND THAT REQUIRES SUPPORT OF THE POLICY DEVELOPMENT GROUP. SO WE WANT TO SUPPORT IN A MUCH BETTER FASHION THE GNSO. AND WE'VE HAD SEVERAL CONVERSATIONS DURING THIS MEETING SPECIFICALLY WITH REGARD TO FILLING THE JOB OPENINGS THAT ARE POSTED AND DEFINING WHAT THOSE TASKS ARE SO THAT WE CAN EFFECTIVELY SUPPORT THE GNSO AND FACILITATE THAT POLICY DEVELOPMENT PROCESS TO MAKE IT -- TO MAKE IT A PREDICTABLE, TRANSPARENT METHOD FOR DEVELOPING NEW PROCESSES AND FOSTERING INNOVATION. TRANSLATION IS A BIG PART OF WHAT WE'RE HOPING TO DO. I HOPE YOU NOTICED THE ICANN NEWSLETTER AND ALSO I THINK WE'RE UP TO NINE OR TEN DIFFERENT LANGUAGES IN THE -- IN SOME OF THE LITERATURE WE ARE DESCRIBING. OUR GOALS IN THE FUTURE ARE BROADER THAN THAT AND INVOLVE TRANSLATION OF THE WEB SITE AND BETTER COMMUNICATIONS WORLDWIDE. PAUL ALLUDED TO SOME OPERATIONAL IMPROVEMENTS WE'RE MAKING. WE'RE AUTOMATING AND STREAMLINING THE IANA PROCESS. AND THE TOOLS THAT ARE DEVELOPED TO STREAMLINE THE IANA PROCESSES WILL SPILL OVER AND BE ABLE TO BE USED IN OTHER AREAS. WE TALKED ABOUT CONTINGENCY PLANNING EARLIER, INTRODUCTION OF IPV6. I DON'T NEED TO LIST THE REST OF THESE. BUT THE EFFORT TO SUPPORT THE INTRODUCTION OF NEW TLDS IS NEW. WE'RE ON THE ROAD TO CONDUCTING STUDIES TO IMPROVING WHOIS ACCURACY. BUT THEN WE'RE GOING TO NEED THE RESOURCES TO ACTUALLY IMPROVE IT ONCE WE HAVE THE PLAN IN PLACE. WE HAVE LITIGATION. THERE'S ANOTHER UNINTENDED BENEFIT TO COMMUNICATIONS I'VE HAD IN COLLABORATION ABOUT THE BUDGET IS THE POTENTIAL TO OUTSOURCE SOME OF OUR OPERATIONS IN THE WAY OF ANSWERING PHONES OR ANSWERING E-MAILS IN THAT TO A CHEAPER LOCATION. I TALKED A LITTLE BIT ABOUT CONDUCTING OUTREACH AND ESTABLISHING REGIONAL OFFICES IN A VERY ECONOMIC WAY AND SUPPORTING IDN INITIATIVES AND DISPUTE RESOLUTION MECHANISMS. THIS YEAR, WE'RE IMPLEMENTING THE OFFICE OF THE OMBUDSMAN. WE'VE ALSO IMPLEMENTED AN INDEPENDENT DISPUTE RESOLUTION PANELS. BOTH OF THOSE REQUIRE EXPENSE TO SUPPORT. THEY'RE REQUIRED BY THE BYLAWS. AND THEY ARE JUST LINE ITEMS THAT REALLY ARE REQUIRED. FINALLY, WE WANT TO INVOLVE STAFF TO PURSUE AGREEMENTS WITH THE RIRS AND THE CCTLDS TO ESTABLISH STABLE RELATIONSHIPS WITH THEM, WITH THE WITH ME AS THE FINANCE COMBINING REVENUES IS VERY EXCITING FOR ME. THE COLLABORATION THAT TOOK PLACE DURING THE BUDGET PROCESS HAS BEEN FAIRLY CONTINUAL FOR THE PAST FOUR MONTHS AT LEAST. WE DESCRIBED THE PROPOSED REVENUE MODEL AND THE PROPOSED EXPENSE MODEL. CHANGES WERE MADE TO BOTH. ABOUT ANOTHER -- I DESCRIBED A 25% REDUCTION IN THE BUDGET EARLIER. ABOUT ANOTHER 25 WAS KNOCKED OFF BASED ON THIS COLLABORATION. WE WORKED WITH THE -- THESE GROUPS HERE. THE COLLABORATION WITH THE GTLD REGISTRARS WAS ESPECIALLY SIGNIFICANT, AND PROBABLY HUNDREDS OF HOURS, ALL TOLD, SPENT ON THAT. THE REVENUE STRUCTURE FOR THIS YEAR IS REMARKABLY SIMILAR TO THAT IN PREVIOUS YEARS. WE RELY HEAVILY ON THE GTLD REGISTRARS FOR A SOURCE OF FUNDING. THE CHANGE THIS YEAR IS THAT WE ARE PROPOSING AND DECIDING UPON A TRANSACTION-BASED MODEL WHERE ICANN REVENUES ARE TIED TO THE SUCCESS OR FAILURE, THE IMPROVEMENT OR DROP IN MARKET SHARE OF THE REGISTRAR BUSINESSES, SO THAT IT GIVES THEM SOME PREDICTABILITY, BETTER PREDICTABILITY AS TO WHAT ICANN FEES MIGHT BE. WE ALSO RECEIVE SET FEES FROM THE GTLD REGISTRIES, THE CCTLDS, AND THE RIRS. VERY IMPORTANT INITIATIVES, THOUGH, IS FOR ICANN TO DEVELOP NEW SOURCES OF FUNDING. JUST FROM THE STANDPOINT OF A BUSINESS MODEL, IT DOESN'T MAKE SOUND BUSINESS SENSE TO RELY SO HEAVILY IN ONE AREA. AND SO WE'VE INITIATED SEVERAL EFFORTS THAT WE EXPECT TO BEAR FRUIT IN THE NEXT EIGHT MONTHS TO 12 MONTHS.

AND NEXT YEAR'S BUDGET WILL REFLECT A BROADER SPREAD OF THE FEE STRUCTURE.

SOME OF THESE OPPORTUNITIES ARE NEW TLDS, AS I DESCRIBED EARLIER, AND EXPIRING TLD REGISTRIES WHERE THE CONTRACT WILL BE RENEGOTIATED. WE'VE HAD MEETINGS WITH MEMBERS OF THE CCNSO THIS WEEK TO ARRIVE AT A METHODOLOGY FOR THEM -- WELL, THEY'RE ARRIVING AT A METHODOLOGY TO WORK TOGETHER TO ESTABLISH A FEE STRUCTURE FOR ICANN. AND SO THEY ARE WORKING THAT ISSUE WITHIN THE CCNSO. NEW REGISTRY AND REGISTRAR SERVICES ARE A SOURCE FOR ICANN TO REALIZE SOME REVENUE. AND, FINALLY, WE THINK THERE'S A VALUED SOURCE OF BUSINESS BENEFICIARIES THAT RELY ON THE STABILITY AND SECURITY OF THE INTERNET TO FACILITATE THEIR STREAMS OF MILLIONS AND BILLIONS OF DOLLARS. AND WE THINK THEY WOULD BE SELF-INTERESTED IN PROMOTING AND SUPPORTING ICANN. THIS BUDGET IS REALLY ONE STEP IN A MULTIYEAR PLAN. WE HAVE A THREE-YEAR MOU AND WE ALSO HAVE SOME GOALS THAT WILL TAKE MORE THAN A YEAR TO ACCOMPLISH. SO IT DOESN'T MAKE MUCH SENSE TO MAKE A SNAPSHOT ONE-YEAR BUDGET. THIS BUDGET IS PART OF THAT LONGER TERM. AND IN ORDER TO ENSURE THAT ICANN MEETS ITS LONG-TERM GOALS AND ALSO PROVIDES NOTICE TO THE WHOLE COMMUNITY ABOUT WHAT THE FUTURE IS GOING TO BRING. SO, FOR EXAMPLE, IN THIS BUDGET, WE'VE ESTABLISHED RESOURCES THAT CAN BE USED IN THE OUT YEARS TO ENSURE THAT WE FULFILL THE OBLIGATIONS OF THIS MOU THAT WE -- WHERE WE NEED TO MEET THESE OBJECTIVES, AND WE'LL BE SUCCESSFUL IN THE LONG TERM. AND WE'RE ALSO PROPOSING THAT THE GTLD REGISTRAR FEES REMAIN -- THE MODEL REMAINS CONSTANT OVER THE NEXT THREE YEARS. AND THIS BUDGET AFFIRMATIVELY SAYS THAT, AND THAT ANY OTHER GROWTH WILL COME FROM SPREADING OUT THE REVENUES, SPREADING OUT ICANN'S BUDGET ACROSS OTHER REVENUE STREAMS. SO THAT'S ALL I HAVE. AND I'LL STAY UP HERE AND ANSWER QUESTIONS, ALONG WITH THE STAFF.

>>VINT CERF: OKAY.

THANK YOU. IN FACT, WE NOW COME TO THE POINT IN THE AGENDA WHERE WE CAN HAVE PUBLIC COMMENT AND Q AND A. THE RANGE OF SUBJECTS FOR THIS PERIOD ARE THE PRESIDENT'S REPORT, THE BOARD COMMITTEE REPORTS, AND THE BUDGET. OTHER COMMENTS ON OTHER MATTERS WE WILL POSTPONE UNTIL LATER IN THE DAY. AMADEU, I THINK YOU'RE FIRST.

>>AMADEU ABRIL I ABRIL: OKAY.

THANKS. AMADEU ABRIL I ABRIL. I HAD SOME COMMENTS ON THE BUDGET. BUT FIRST I WOULD LIKE ASKING KURT WHETHER HE COULD EXPLAIN MORE THE BUDGET REGARDING I THINK THE REGISTRIES HAVE NOT CHANGED, BUT THE CHARGES WERE ON THE REGISTRAR SIDE. IF HE WOULD EXPLAIN SOMETHING MORE, AT WHAT POINT WE ARE, BECAUSE WE HAVE SEVERAL ITERATIONS OF THE BUDGET. IT WAS NOT CLEAR FOR ME WHERE WE ARE TODAY.

>>KURT PRITZ: WELL, AS YOU KNOW, I THINK, AMADEU, THE REGISTRY FEES ARE SET BY -- OKAY. WRONG QUESTION?

>>AMADEU ABRIL I ABRIL: THE ONES -- THE REGISTRARS.

>>KURT PRITZ: WHAT?

>> THE REGISTRARS.

>>VINT CERF: AMADEU, I THINK THE QUESTION ISN'T CLEAR.

DOUGH WANT TO TRY ONE MORE TIME.

>>AMADEU ABRIL I ABRIL: SORRY.

LET'S MAKE, THEN, THE COMMENT, WHETHER IT FITS THE CURRENT SITUATION OR NOT. I JUST WANTED TO DRAW THE ATTENTION OF THE BOARD TO THE FACT THAT THIS YEAR WAS A CERTAIN CHANGE IN THE STRUCTURE OF THE FEES. SOME OF THEM ARE VERY WELCOME, LIKE WITH KURT AND THE STAFF AND ALL OF THAT TO TRY TO STABILIZE A MODEL FOR THREE YEARS AND NOT HAVE EACH YEAR DIFFERENT SURPRISES ON THAT. MY CONCERN CAME HERE THROUGH A CERTAIN CHANGE IN THE STRUCTURE IN WHICH THERE WAS AN INCREASE OF THE FIXED CONTRIBUTIONS, THAT IS, THAT THOSE ARE EQUAL PER REGISTRAR, EVEN IF THEN THERE WERE SOME ADJUSTMENTS. QUITE FRANKLY, I THINK THAT THE BEST SYSTEM FROM ALL POINTS OF VIEW IS ONE THAT'S BASED IN A DOMAIN NAME FEE, BOTH FROM A BUDGETARY POSITION FOR ICANN AND BUDGETARY PROVISION AND ACCOUNTING PROVISION FOR THE REGISTRARS, BUT ALSO FROM A VERY IMPORTANT POINT OF VIEW, COMPETITION, WHICH IS, YOU KNOW, ONE OF THE MAIN FOUNDATIONS OF ICANN GOALS. AND I THINK THAT FROM ANY SIDE YOU SEE THAT FROM A COMPETITION POINT OF VIEW EQUAL FEE FOR DOMAIN NAME MANAGED BY A REGISTRAR IS MUCH BETTER THAN A FIXED FEE THAT CLEARLY AFFECTS IN A VERY DIFFERENT WAY THE SMALL REGISTRARS THAN THE BIGGER REGISTRARS. AND IN A WAY, THEY FAVOR THE BIGGER PLAYERS IN THIS GAME, WHICH I DON'T THINK IS COMPLETELY CONSISTENT WITH OUR COMPETITION GOALS. I UNDERSTAND ALL THE, YOU KNOW, CONSTRAINTS WE ARE HAVING THAT TWO-THIRDS OF THE VOTES OF THE REGISTRARS REPRESENTING TWO-THIRDS OF THE REGISTRATIONS BEING MADE. BUT I STILL WOULD LIKE THE BOARD CONSIDERING WHAT ARE THE OTHER PRIORITIES AND WHETHER, YOU KNOW, A TRULY COMPETITIVE MODEL THAT DOESN'T FAVOR ANY SORT OF REGISTRARS OR REGISTRIES OVER OTHERS, ESPECIALLY THE BIG ONES OVER THE SMALL IS NOT ONE OF THE TOP PRIORITIES. THE SECOND COMMENT WAS THAT IN ORDER TO TRY TO MINIMIZE THE IMPACT OF A FIXED COST FOR REGISTRIES, THERE WAS A SORT OF DOUBLE STANDARD. THE BIG ONES PAYING SOMETHING, AND IF YOU PROVE THAT YOU HAVE LESS THAN X REGISTRATIONS AND THAT YOU ARE A REAL REGISTRAR, LET'S SAY, ONE THAT IS HERE TO REGISTER DOMAIN NAMES ON BEHALF OF END USERS AND NOT WHAT WE ARE SEEING THIS EMERGING TREND OF THREAD RESELLERS, WHO RESELL THOSE TO THOSE OPERATING IN THE AFTER MARKET, BUT, IN FACT, THEY ARE PERFORMING VERY LITTLE REGISTRATIONS AT THE END OF THE YEAR, THERE WAS SOME SORT THAT ARE YOU NOT IN THIS CATEGORY, YOU PAY LESS. WELL, THE PROBLEM IS THAT HERE WE ARE TRYING TO SOLVE A PROBLEM, WHICH IS THE EXISTENCE OF THESE OTHER SORT OF REGISTRARS THAT ONLY COME HERE TO GAIN ACCESS TO THE REGISTRY FOR OTHER PURPOSES THAN REGISTERING DOMAIN NAMES FOR END USERS THROUGH THE BUDGET. AND I WOULD SAY THAT THIS IS NOT THE RIGHT TOOL TO USE. THIS IS A DIFFERENT PROBLEM THAT SHOULD BE SOLVED AT A DIFFERENT LEVEL AND NOT THROUGH THE BUDGET. THE THIRD COMMENT IN THIS AREA IS THAT SOME OF THE FIGURES I SAW WERE SOMETIMES ABSOLUTE FIGURES, LET'S SAY LESS THAN 230,000, LESS THAN "X" COMMANDS PER DOMAIN NAME. AND THIS MAY NOT SCALE VERY WELL IF YOU HAVE A SYSTEM FOR THREE YEARS, THESE FIXED FIGURES MAY NOT SCALE VERY WELL OVER THIS PERIOD OF TIME. SO THIS WAS MY COMMENTS IN THIS AREA. REGARDING -- BUT I DON'T KNOW WHETHER WE ARE STILL HERE, WE CHANGED THE PROPOSITIONS. THE LAST COMMENT REGARDING THIS, REGARDING ALTERNATIVE SOURCES OF FUNDING. AND HERE I WOULD SAY, AS I ALSO COMMENTED TO KURT AND MANY OTHERS, THAT PERHAPS IT'S TIME WE ARE A LITTLE BIT MORE COURAGEOUS AND IN THE SAME TIME THAT WE GOT OFFERS FOR FUNDING FOR SPECIAL PROJECTS LIKE OPENING AN OFFICE HERE AND THERE, PERHAPS WE SHOULD SEPARATE SOME PARTS WHICH ARE NOT JUST RUNNING THE SHOW, WHICH RUNNING THE SHOW SHOULD BE JUST PAID BY THE GNSO LEG OF ICANN, AND TAKE ALL THESE SPECIAL SECURITY PROJECTS, DNSSEC, IPV6, ALL THESE MORE FUNDAMENTAL INFRASTRUCTURE THINGS, HAVE THAT AS A SEPARATE PROJECT AND ASK GOVERNMENTS AND CCTLDS TO CONTRIBUTE THERE INSTEAD OF SOME OF THEM CONTRIBUTING TO THE BUDGET. THE GOVERNMENTS SHOULD NOT CONTRIBUTE TO THE GENERAL BUDGET, BUT THEY MAY CONTRIBUTE TO SOME OF THESE SPECIAL PROJECTS. THE CCTLDS SHOULD CONTRIBUTE TO THE BUDGET, BUT THEY ARE NOT TODAY. SO PERHAPS AS A FAIR STEP, THEY COULD CONTRIBUTE TO SOME OF THESE PROJECTS TO BE OF SPECIAL INTEREST FOR THEM. AND THIS WOULD ALLEVIATE SOME OF THE PRESSURE ON, YOU KNOW, THOSE CURRENTLY PAYING.

>>VINT CERF: THANK YOU, AMADEU.

I'M ALWAYS IMPRESSED BY YOUR ABILITY TO BRING TO A FAIRLY CRISP STATEMENT A VARIETY OF ISSUES. MIKE PALAGE.

>>MICHAEL PALAGE: I THINK, IF I CAN, AMADEU, TRYING TO SUCCINCTLY POINT OUT A CUSTOM OF HIS ISSUES, I BELIEVE AMADEU WAS RAISING CONCERNS REGARDING THE VARIABLE REGISTRAR FEE.

THIS IS THE FIRST TIME ICANN HAS IMPOSED IT IN THE CURRENT BUDGETARY STRUCTURE. THE ONE POINT THAT I DID WANT TO SHARE WITH REGARD TO AMADEU IS THAT WITH REGARD TO THE WAIVER IN THAT VARIABLE FEE, I THINK ICANN NEEDS TO PROCEED VERY CAUTIOUSLY SO AS NOT TO BE, IF YOU WILL, ENDORSING CERTAIN BUSINESS MODELS IN THE REGISTRAR MARKETPLACE. SO I JUST WANTED TO ELABORATE ON THAT POINT.

>>VINT CERF: THANK YOU, MIKE.

KURT, DID YOU HAVE A COMMENT?

>>KURT PRITZ: YEAH, I'D LIKE TO RESPOND, ALTHOUGH AMADEU AND I TALK OFTEN, SO WE COULD TALK OFFLINE.

I UNDERSTAND YOUR CONCERN ABOUT THE FIXED FEE AND THE POTENTIAL UNFAIRNESS OF IT. AS WITH ANYTHING, AND AS YOU RECOGNIZED IN YOUR STATEMENT, THE CREATION OF A BUDGET IS A BALANCING. AND THE PER-DOMAIN NAME FEES HAVE GONE UP EVERY YEAR FOR SEVERAL YEARS FROM 12 CENTS TO 18 CENTS TO POTENTIALLY 25 CENTS NOW. SO WHAT -- THE RESULT IS A FAIRLY MODERATE FIXED FEE IS BEING IMPLEMENTED. BUT CERTAINLY PART OF THE BACK -- YEAH, THAT'S A VARIABLE FEE. THE PER-REGISTRAR FEE WAS WIDELY DISCUSSED, AND, IN FACT, A LOT OF THE REDUCTION IN IT IS A RESULT OF THAT DISCUSSION WITH SMALLER REGISTRARS. REGARDING YOUR COMMENTS ON THE BATCH POOL AND THAT SITUATION SHOULD BE SOLVED OTHERWISE AND NOT THROUGH THE BUDGET, I AGREE 100%. WITH REGARD TO YOUR COMMENT ON FORGIVENESS AND THE SCALING OF IT, OUR MEETING WITH THE BUDGET ADVISORY COMMITTEE EARLIER IN THE WEEK RECOGNIZED THAT FACT, TOO, AND ACTUALLY BUILT INTO THE BUDGET AN AUTOMATIC REVIEW OF THAT FORMULA. SO IT MAY BE CHANGED OVER TIME, REALIZING WHAT THE GOALS OF THE FORMULA ARE. SO THAT'LL BE CHANGED. AND I ALSO AGREE, FINALLY, ON YOUR COMMENTS WITH -- REGARDING FUNDING CERTAIN EFFORTS SEPARATELY. I THINK IT'S A QUESTION OF WHERE YOU DRAW THE LINE ON THOSE THINGS, WHERE THERE'S TOTAL COMMUNITY BENEFIT FOR SOMETHING VERSUS SOMETHING THAT'S REALLY A SPECIFIED PROJECT. SO I THINK -- WELL, AT LEAST YOU AND I AGREE ON THAT. AND WHAT WE SHOULD DISCUSS IS WHERE TO DRAW THE LINE BETWEEN WHAT SHOULD BE FUNDED SEPARATELY AND WHAT SHOULD NOT.

>>VINT CERF: SO -- THIS IS VINT -- I'D LIKE TO ADD A LITTLE BIT MORE TO THAT.

FIRST OF ALL, WITH REGARD TO THE SPECIAL PROJECTS, OF COURSE, I'M ALWAYS IN FAVOR OF FINDING SUPPORT WHEREVER WE CAN TO FURTHER THE GOALS OF THE ORGANIZATION AND TO IMPROVE THE STABILITY AND SECURITY OF THE INTERNET. I DO WORRY A LITTLE BIT ABOUT SOMETHING SO FUNDAMENTAL AS IPV6 AND ITS DESIRABLE INTRODUCTION INTO THE NET BEING CONTINGENT SOMEHOW ON FINDING A GRANT FROM SOMEONE AS OPPOSED TO BUILDING IT INTO THE FUNDED WORK OF ICANN.

I'M ONLY PICKING ON THAT JUST BECAUSE AMADEU HAPPENED TO MENTION IT. THERE MIGHT INDEED BE SOME ASPECTS OF THE WORK THAT COULD BE CONSIDERED LESS RISKY OR MORE SUSCEPTIBLE TO UNCERTAIN FUNDING. BUT I WOULD RECOMMEND THAT WE ARE CAREFUL NOT TO ACCIDENTALLY PLACE CRITICAL WORK IN AN UNFUNDED POSITION WHICH WE ULTIMATELY HAVE TO SERVICE. AMADEU WANTS TO RESPOND.

>>AMADEU ABRIL I ABRIL: NOT RESPOND TO THAT.

JUST, AGAIN, FOR THE FINANCIAL COMMITTEE AND THE BOARD, JUST MAKE THE CALCULATION OF WHAT'S THE MINIMUM FIXED COST TO BECOME A REGISTRAR, THEN TAKE A MAP AND LOCATE THE CURRENT REGISTRARS ON THAT MAP, AND YOU WILL UNDERSTAND LOTS OF THINGS. SO IF WE ARE GOING THAT DIRECTION OF RAISING THE FIXED COSTS, WHICH ARE CLEAR BARRIERS FOR SMALL REGISTRARS IN MANY COUNTRIES IN MANY PARTS OF THE WORLD, THEY WILL BE SMALL REGISTRARS FOR A LONG TIME BEFORE THEY GROW THAT FAST. JUST THINK ABOUT TOTAL (INAUDIBLE) SOLUTIONS FOR CERTAIN KINDS OF REGISTRARS, WHERE I THINK THAT THE PRICE OF BEING PART OF THAT CLUB IS BECOMING TOO HIGH BEFORE YOU START SELLING THE FIRST DOMAIN NAME.

>>VINT CERF: THE COUNTER-OBSERVATION, OF COURSE, IS THAT IF THERE ARE CERTAIN COSTS THAT ICANN BEARS FOR EACH REGISTRAR INDEPENDENT OF ITS SIZE, YOU'D WANT TO MAKE SURE THAT GETS ACCOUNTED FOR IN THE BUDGET SOMEHOW.

IVAN, YOU HAD YOUR HAND UP.

>>IVAN MOURA CAMPOS: IT'S JUST TO MENTION TO AMADEU THAT WE HAVE LOCATED THE REGISTRARS ON A MAP, AND, INDEED, WE HAVE LEARNED A LOT OF THINGS.

SO WE KNOW OF THESE DATA AND WE HAVE CAREFULLY ANALYZED THIS GRAPH AND HOW THEY ARE SPREAD ALONG THE SPECTRUM IN SIZE AND DOMAIN NAME REGISTRATIONS AND REVENUES.

>>VINT CERF: OKAY.

WE ARE STILL IN THE PUBLIC COMMENT PERIOD. SO ARE THERE OTHERS? WOLFGANG.

>>WOLFGANG KLEIUWACHTE: MY QUESTION GOES TO PAUL TWOMEY.

WHEN YOU MENTIONED THE MILESTONES IN THE MOU, YOU DID NOT EXPLICITLY REFER TO THE STRATEGIC PLAN. COULD YOU SAY SOMETHING ABOUT THE STATUS? THANK YOU.

>>PAUL TWOMEY: THANKS, WOLFGANG.

THE STRATEGIC PLAN, LIKE A LOT OF THE THINGS IN THE MOU, IS A PRODUCT OF COLLABORATIVE DISCUSSION WITH THE DEPARTMENT OF COMMERCE THAT TOOK PLACE LAST YEAR WITH A NEW MANAGEMENT TEAM AND UNDER THE GUIDANCE OF THE BOARD. THE -- I THINK PART OF THIS MOVING TO A MATURE PHASE FOR THE ORGANIZATION AND FOR THE COMMUNITY INVOLVES ALSO, YOU KNOW, SORT OF SEVERAL INSTRUMENTS FOR PLANNING THAT ARE NECESSARY. SO WE STARTED THE PROCESS OF DEVELOPING A STRATEGIC PLAN AND HAD A STRATEGIC PLAN IN PLACE BY, YOU KNOW, I THINK THE FIRST VERSION WAS IN PLACE BY THE END OF AUGUST, BEGINNING OF SEPTEMBER LAST YEAR. STRATEGIC PLANS WHEN YOU PUT THEM IN PLACE YOU DO THE WHOLE PROCESS OF CONSULTATION INTERNALLY AND PUSH AND CHANGE AND THINK FOR THE FIRST TIME, TO USE A PHRASE, YOU KNOW WHEN YOU HAVE PRIME TIME. YOU DON'T HAVE A DOCUMENT THAT REALLY IS, I THINK, REALLY BRINGING OUT TO THE COMMUNITY. WE'VE HAD A LOT OF CONSULTATION INSIDE, A LOT OF CONSULTATION WITH THE BOARD. AND, WOLFGANG, I THINK THE PROBLEM WE ENDED UP WITH IS THAT WE DIDN'T LIVE IN A PERFECT WORLD. IN AN IDEAL WORLD, YOU KNOW, I AM REMINDED OF CANDID, IN AN IDEAL WORLD, WE WOULD HAVE HAD TO (INAUDIBLE) THE STRATEGIC PLAN, GIVEN THE COMMUNITY MONTHS OF POSSIBLE RESPONSES ON A STRATEGIC PLAN, THEN MOVED TO A BUDGET. THE BUDGET WOULD HAVE HAD MONTHS, AS IT HAD. THE BUDGET PROCESS STARTED IN DECEMBER, OKAY. SO THAT'S, YOU KNOW, EIGHT MONTHS AGO. WE WOULD HAVE HAD THE TIME TO DO THE BUDGET CONSULTATION, ET CETERA. THE DIFFICULTY THAT EMERGED, BASICALLY, WAS RUNNING THE PARALLEL PROCESS WAS JUST GOING TO BE TOO MUCH BANDWIDTH FOR THE CAPACITY OF THE ADMINISTRATION WE HAD. SO WE MADE A JUDGMENT, WHICH WAS, LET'S PUT AS MUCH AS WE CAN -- ACTUALLY, LET'S PUT ALL THE SORT OF IDEAS THAT WERE SITTING IN THE STRATEGIC PLAN FOR THIS FIRST YEAR CLEARLY IN THE BUDGET AND GO AND CONSULT AND TALK TO PEOPLE ABOUT IT IN A ONE-YEAR TIME FRAME. AND ALSO BE FAIRLY OPEN TO THE SORT OF THINGS THAT WERE EMERGING OUT FOR LONGER TERM. AMADEU MENTIONED A FEW OF THEM. BUT LET'S JUST FOCUS ON THE BUDGET ROUND. AND WE'VE DONE A LOT OF CONSULTATION AROUND THE BUDGET ROUND. KURT'S GONE THROUGH THAT. WE HAVE LEARNED A LOT MORE ABOUT WHAT THE COMMUNITY IS LOOKING FOR, WHAT'S FEASIBLE, YOU KNOW, WHAT SORT OF MODELS, WHAT SORT OF FINANCES, WHAT SORT OF MODEL IS ACCEPTABLE. WHICH, AGAIN, REQUIRES TO DO VERSION 7 OR 8 OR WHATEVER OF THE STRATEGIC PLAN, INTERNALLY, REVISION. IT IS OUR HOPE -- NOW I AM TALKING ON THE CEO, I HAVE TO TAKE THIS BACK TO THE BOARD -- BUT IT IS OUR HOPE THAT BETWEEN HERE AND CAPE TOWN, AND I HOPE CLOSER TO HERE THAN CAPE TOWN MEETING, THAT WE WILL BE IN POSITION TO ACTUALLY PUT THE STRATEGIC PLAN OUT FOR CONSULTATION IN THAT SENSE, THERE WILL BE NOTHING IN INN THAT PLAN THAT WILL BE A SURPRISE FOR 12 MONTHS BECAUSE ALL THE ISSUES ARE IN THE BUDGET PLANNING PROCESS. BUT THE ISSUES FOR THE NEXT SEVERAL YEARS IN TERMS OF OPERATIONAL ISSUES WE WILL HAVE TO PUT OUT IN A STRATEGIC PLAN FOR CONSULTATION AND GET PEOPLE'S FEEDBACK. AND IN SOME RESPECTS, THAT'LL BE THE BEGINNING OF THE CONSULTATION FOR THE NEXT YEAR'S BUDGET BY HAVING SUCH A PLAN OUT FOR CONSULTATION. WE THINK THAT CONSULTATION IS IMPORTANT. I JUST MAKE THE ONE FURTHER OBSERVATION, THE NATURE OF PLANNING, AND PARTICULARLY THE NATURE OF FINANCIAL PLANNING THAT ONE DOES IN A STRATEGIC PLAN IS A QUANTUM DEGREE LESS SPECIFIC THAN YOU DO IN A BUDGET. SO THE SORT OF FINANCIAL NUMBERS THAT WE WOULD PUT FORWARD FOR THE TWO YEARS, THREE YEARS FURTHER OUT WILL NOT BE WITH THE SORT OF DETAIL THAT YOU NEED TO PUT IN FOR A BUDGET AND MANAGE FOR A BUDGET. BUT WE DO HOPE TO SHARE WITH YOU A STRATEGIC PLAN WHICH WE THINK WILL REFLECT A LOT OF YOUR OWN INPUTS, AS I SAID, CLOSER TO THIS MEETING THAN TO CAPE TOWN, BUT BETWEEN HERE AND CAPE TOWN.

>>VINT CERF: THANK YOU, PAUL.

I SENSE THERE ARE SEVERAL OTHER COMMENTS. MARILYN CADE.

>>MARILYN CADE: THANK YOU.

MY NAME IS MARILYN CADE. I AM SPEAKING AS AN INDIVIDUAL ELECTED REPRESENTATIVE TO THE COUNCIL. I'D LIKE TO COMMENT, FIRST OF ALL, ON THE CEO'S REPORT AND TO THANK PAUL FOR THE APPROACH YOU TOOK IN REMINDING US OF WHERE WE HAVE COME FROM AS WELL AS WHERE WE ARE GOING. I THINK THAT AS WE ALL ARE INCREASINGLY AWARE, THAT AS THE INTERNET BECOMES MORE AND MORE IMPORTANT, GOVERNMENTS AND MANY OTHERS WHO ARE NOT TODAY INVOLVED IN ICANN HAVE MANY QUESTIONS ABOUT ICANN AND ITS ROLE. AND I THINK THAT AS WE ALL WORK TOGETHER TO HELP TO INFORM THE INTERNET GOVERNANCE DEBATE AND THE OVERALL WSIS PROCESS AND THE VISIBILITY OF ICANN MORE BROADLY AS IT BECOMES MORE INTERNATIONALIZED, THAT TELLING THE STORY THAT YOU TOLD TODAY, PAUL, IS A VERY IMPORTANT PART OF THAT. I'D LIKE TO ALSO THANK YOU FOR TAKING THE STEPS TO INCREASE AND CONTINUE TO INCREASE THE WAY THAT COMMUNICATION INFORMATION IS BEING MADE AVAILABLE BROADLY TO THE COMMUNITY. I THINK THAT WILL BE VERY WELCOMED. AND I SEE STEPS TAKEN SINCE EVEN THE LAST MEETING THAT WE WERE HERE. I'D LIKE TO ALSO SAY, AS SOMEONE WHO VERY EARLY ON, THROUGH THE BC AND OTHERWISE, CHAMPIONED THE IMPORTANCE OF THE ROLE OF THE CC'S, THE RIRS, AND THE ROOT SERVERS, AS WELL AS THE GTLD REGISTRIES AND REGISTRARS AND COMMUNITY, THAT WE ARE IN A VERY, I THINK, SIGNIFICANT POINT, IS THAT AT THIS MEETING, THE CCNSO WAS LAUNCHED. AND I THINK ALL OF US SHOULD PRIVATELY AND PUBLICLY THANK THE INDIVIDUALS WITHIN THAT ORGANIZATION, THAT COMMUNITY, WHO WORKED SO HARD TO MAKE IT HAPPEN. I KNOW THAT MANY ON THE BOARD AND THE STAFF CONTRIBUTED AS WELL. BUT THE REAL WORK WAS DONE WITHIN THAT COMMUNITY TO CREATE THE BOTTOM-UP CONSENSUS APPROACH AND TO BRIDGE THE DIVIDES THAT SOMETIMES EXISTED. AND, FINALLY, I'D LIKE TO MAKE A COMMENT ABOUT THE BUDGET. I DID DO AN EIGHT-PAGE ANALYSIS OF THE PUBLIC DOCUMENT THAT WAS AVAILABLE AND SHARED IT WITH MY FELLOW ELECTED REPRESENTATIVES IN THE BUSINESS CONSTITUENCY. I AM DISAPPOINTED ABOUT THE LACK OF ACCESS TO THE STRATEGIC PLAN AND TO COMMENTING ON AND HELPING TO PROVIDE INPUT ON THE STRATEGIC PLAN AND WOULD ASK THAT, ON A FORMAL BASIS, THE CONSULTATION WITH ALL THREE OF THE SUPPORTING ORGANIZATIONS BE SOUGHT AND INCORPORATED INTO THAT PROCESS. AND I KNOW THAT CAN BE DONE GOING FORWARD. BUT PERHAPS IT'S POSSIBLE TO ALSO TAKE SOME COMMENT AS QUICKLY AS POSSIBLE THROUGH THE SUPPORTING ORGANIZATIONS. WE ARE FACING THE NEED, AS WE GROW ICANN, TO ALSO FIND WAYS TO PARTNER WITH OTHERS TO EXPAND ICANN'S WORK. AND I SAW SOME EFFORTS ON THAT PART, AND I THINK THAT THERE ARE PROBABLY SOME THAT CAN BE FURTHER EXPLORED. AS YOU LOOK AT THE BUDGET, I WOULD SAY THAT I HOPE THAT WE ALL -- AND I COUNT ON US ALL SHARING THE OBJECTIVES OF HAVING AN ACCOUNTABLE BUDGET, AN ATTAINABLE BUDGET, AND A SUSTAINABLE BUDGET. AND I FOCUS ON "SUSTAINABLE" AS A POINT, BECAUSE I KNOW IT'S VERY RISKY FOR US TO HAVE REVENUE THAT IS NOT SELF-RENEWING YEAR AFTER YEAR IF WE ARE GOING TO BE ABLE TO MAINTAIN THE STABILITY WE ARE SEEKING FOR ICANN.

>>VINT CERF: THANK YOU VERY MUCH, MARILYN.

ONE OBSERVATION I WOULD MAKE IS THAT EVEN IN THE ABSENCE OF HAVING A PUBLISHED STRATEGIC PLAN, THAT IF YOU HAVE CONSIDERATIONS AND IDEAS ABOUT WHAT OUGHT TO BE IN IT, YOU SHOULD CERTAINLY CONVEY THOSE TO THE BOARD AND PAUL AND TO OTHERS. PETER.

>>PETER DENGATE THRUSH: PETER DENGATE THRUSH SPEAKING AS CHAIRMAN OF THE ASIA-PACIFIC TOP-LEVEL DOMAIN ASSOCIATION.

FIRST, WE HAD A MEETING HERE ON SATURDAY, AND IT WAS ATTENDED BY REPRESENTATIVES ALSO FROM THE LATIN AMERICAN TOP-LEVEL DOMAIN ASSOCIATION, THE AFRICAN TOP-LEVEL DOMAIN ASSOCIATION, AND THE EUROPEAN ASSOCIATION, CENTR, WHO TOOK PART. BUT I AM NOT SPEAKING ON THEIR BEHALF. I WANT TO CONVEY THE MESSAGE WE CONVEYED TO THE STAFF AT THE TIME THAT THE CCTLDS CONTINUE TO OFFER MONEY TO ICANN. THESE ARE THE VAST MAJORITY OF CCTLDS WHO HAVE NO CONTRACTUAL OBLIGATION, BUT AS OUR BEHAVIOR HAS DEMONSTRATED OVER THE YEARS, WE COME BECAUSE WE WANT ICANN TO SUCCEED. AGAIN, I SAY, WE ARE OFFERING ICANN MONEY. AND WE REMAIN DISAPPOINTED AND SURPRISED THAT THE ONLY CONDITION THAT WE'VE PUT ON THAT, THAT THERE BE A CLEAR SET OF ACCOUNTS PUBLISHED -- EXCUSE ME -- WHICH WOULD CHARACTERIZE IN MORE DETAIL THE COSTS OF RUNNING THE IANA PROCESS, STILL REMAINS UNDONE. SO WHAT SEEMS TO US A STRANGE POSITION TO BE CALLING FOR MONEY, TO HAVE PEOPLE OFFERING YOU MONEY, WE ARE ASKING FOR A SET OF ACCOUNTS NO DIFFERENT FROM MY OWN SMALL LAW FIRM USED TO OPERATE OR ANY SME WOULD PROVIDE. WE ARE NOT ASKING FOR TIME SHEETS OR DETAILED ANALYSES. WE ARE ASKING FOR A ROUGH BREAKDOWN OF THIS ANALYSIS. AND YOU UNDERSTAND THE BASIS FOR THAT IS THAT THE CCTLDS HAVE CONTINUALLY, I THINK FROM THE VERY FIRST MEETING IN '99, SAID THAT WE ARE QUITE PREPARED TO PAY FOR OUR SHARE OF THE IANA SERVICES, AND WE ARE ALSO PREPARED TO PAY A CONTRIBUTION TO THE GENERAL OVERHEAD OF ICANN, THE BOARD EXPENSES, THE RUNNING OF THE WEB SITE, ET CETERA. SO I JUST MAKE THAT POINT ONE MORE TIME. WE HAVE SOME MONEY. WE WANT TO GIVE IT TO YOU. WE THINK THE CONDITION THAT'S HOLDING UP THE GIVING OF THAT MONEY IS A VERY SIMPLE ONE. AND WE ASK THE BOARD TO INSTRUCT THE STAFF TO PREPARE A CHART OF ACCOUNTS WHICH WILL UNLEASH THAT MONEY, BECAUSE WE WANT TO GIVE IT TO YOU. IF I CAN NOW TAKE THAT HAT OFF AND JUST PUT MY OWN INTERNET NEW ZEALAND HAT BACK ON. I WONDER IF I CAN GIVE SOME CONSTRUCTIVE ADVICE TO THE STAFF, I THINK, IN THE PREPARATION OF THE BUDGET AND REMIND THE NEW STAFF, PERHAPS, OF THE CULTURAL, POLITICAL, AND LEGAL SENSITIVITIES OF THE CCTLD, BECAUSE THE WAY SOME OF THE DESCRIPTIONS IN THE OUTLINES AND THE PROCESSES ARE GOING SEEM TO REVEAL A DIFFICULTY WITH THAT. THE CCTLDS ARE RESPONSIVE TO THEIR LOCAL INTERNET COMMUNITIES AND THE GOVERNMENTS. THEY ARE EACH INDEPENDENT. AND WE HAVE USED THE WORD SOVEREIGN IN LOOSE JARGON FOR THEIR RIGHT TO NATIONAL SELF-DETERMINATION. THERE'S FREQUENT REFERENCES TO THE CCNSO, TO CCTLD REPRESENTATIVES, AND SO FORTH, WHICH IS SIMPLY UNTRUE. THERE WERE NO CCTLD REPRESENTATIVES CONSULTED IN THE FORMATION OF THE BUDGET. THERE WERE NO CCTLD REPRESENTATIVES. THERE WERE A NUMBER OF INDIVIDUAL CCTLD MANAGERS WHO VOLUNTEERED THEIR OWN TIME AND THEIR OWN PERSONAL POSITIONS. THEY ARE NOT REPRESENTATIVES OF THE CCTLDS. NO ONE CCTLD CAN MAKE REPRESENTATIONS ON BEHALF OF THE CCTLD COMMUNITY. SIMILARLY, THERE'S REFERENCE TO COLLABORATION WITH THE CCNSO. THERE HAS BEEN NO DISCUSSION IN THE CCNSO ABOUT THE BUDGET. THE CCNSO IS A BOTTOM-UP, MEMBERS-BASED ORGANIZATION THAT HAS TRANSPARENT AND OPEN PROCESSES WHICH IT IS DEVELOPING. SO TO SAY COLLABORATION WITH THE CCNSO MEANS IT'S GUN TO THE MEMBERS OF THE CCNSO AND BEEN THROUGH THE CCNSO PROCESS. THERE WILL HAVE BEEN CONSULTATION, I'M SURE, WITH INDIVIDUAL CCTLD MANAGERS. THAT IS NOT CONSULTATION WITH THE CCNSO. AND THE SUGGESTION ON SLIDE THAT THERE IS GOING TO BE A DECISION MADE BY THE CCNSO ON INDIVIDUAL CCTLD CONTRIBUTIONS AGAIN IS A SUGGESTION THAT HAS NOT BEEN DISCUSSED BY THE CCNSO. SO IF I COULD URGE THE STAFF TO BE PARTICULARLY AWARE OF THE SENSITIVITIES OF THE CCTLDS IN RELATION TO THEIR INDIVIDUAL SOVEREIGNTY, AS WE CALL IT, AND DECISION-MAKING. NO DECISION OF THE CCNSO IS GOING TO EVER BIND AN INDIVIDUAL CCTLD AS TO ITS LEVEL OF CONTRIBUTION. SO IF THAT CRITICISM CAN BE TAKEN IN THE SPIRIT WHICH IT IS INTENDED, WHICH IS TO IMPROVE THE RELATIONSHIP BETWEEN US, THAT WOULD BE EXCELLENT. THANK YOU.

>>VINT CERF: THANK YOU, PETER. IT DOES OCCUR TO ME THAT THE INDEPENDENT CCTLDS COULD CHOOSE TOGETHER, OR SOME SUBSET OF THEM COULD CHOOSE TO COOPERATE WITH REGARD TO BUDGETARY MATTERS. IS THAT NOT TRUE?

>>PETER DENGATE THRUSH: YES, OF COURSE. AND THEY DO. AND I THINK THE CCNSO HAS AGREED TO NOMINATE SOME MEMBERS TO THE BUDGETARY ADVISORY COMMITTEE.

THE DIFFICULTY IS IN REACHING ANY CONCLUSION OF THAT AS BINDING ON OR A DECISION OF THE CCTLD COMMUNITY. I'M JUST WANTING TO MAKE SURE THAT'S CLEAR.

>>VINT CERF: FAIR ENOUGH. THANK YOU. RAUL.

>>RAUL ECHEBERRIA: THANK YOU, VINT. MY NAME IS RAUL ECHEBERIA AND I'M SPEAKING ON BEHALF OF NRO. WE HAVE SUBMITTED COMMENTS ON 15TH OF JULY.

SINCE THE COMMENTS ARE PUBLIC ON THE ICANN WEB SITE, BUT ALSO IN THE NRO WEB SITE, I WILL ONLY SUMMARIZE OUR POSITION.

FIRST OF ALL, I WOULD LIKE TO REMARK THAT ALL OF THE COMMENTS SUBMITTED PUBLICLY NOW ARE CONSISTENT AND ARE IN THE SAME LINE OF THE COMMENTS THAT WE SUBMITTED TO THE BUDGETARY GROUP LAST MAY. SUMMARIZING, THE AMOUNT OF THE CONTRIBUTION EXPECTED BY ICANN AS COULD BE AFFORDABLE BY THE NRO. IT DOESN'T SEEM TO BE A PROBLEM AT THIS STAGE IN SPITE OF THE FACT THAT THIS IS -- IT MEANS AN IMPORTANT INCREASEMENT IN RELATIONSHIP WITH THE (INAUDIBLE) COMMITMENTS FROM THE RIR SECTOR. BUT AFTER THE FORMAL APPROVAL OF THE BUDGET IN THIS BY THE ICANN BOARD, THE NRO WILL DEAL WITH THIS CONTRIBUTION RESPECTIVELY. WE DON'T SEE ANY PROBLEM IN THIS ISSUE. PROBABLY THE MOST IMPORTANT IS THAT WE ARE NOT SATISFIED WITH THE BOTTOM-UP PROCESS CONDUCTED WITH -- IN RELATION WITH THIS BUDGET. AS WE UNDERSTAND THAT THE BUDGETARY GROUP SHOULD WORK IN A BETTER WAY, WITH MORE DISCUSSIONS AND WITH MORE INFORMATION, AND WITHOUT THE TIME CONSTRAINTS THAT WE HAD THIS YEAR. ANOTHER IMPORTANT POINT TO REMARK IS THAT WE HAVE ASKED ICANN FOR MANY YEARS TO SHOW THE INFORMATION IN A DIFFERENT WAY. THE BUDGET, SEPARATED BY DEPARTMENTS, AS WE SHARE WITH THE CCTLD COMMUNITY. THEY NEED TO KNOW, IDENTIFY THE COST OF OPERATION OF IANA -- OF IANA. IT DOESN'T MEAN THAT WE ARE ONLY WILLING TO PAY'S FOR THE IANA COSTS. WE HAVE RATIFIED MANY, MANY TIMES THAT -- OUR WILLINGNESS TO PAY -- TO HELP IN ALL THE COSTS OF ICANN FUNCTIONING. WE -- BESIDE THE FACT THAT THIS YEAR IS THE PROCESS OF DISCUSSION OF THE (INAUDIBLE), WE'D LIKE TO REMARK THAT THOSE CONCERNS EXPRESSED THIS YEAR WILL REMAIN ON THE TABLE FOR THE NEXT YEAR. WE HOPE AND WE ASK YOU TO CONSIDER THOSE CONCERNS FOR THE PROCESS TO DISCUSS THE BUDGET IN THE NEXT YEAR. THANK YOU.

>>VINT CERF: THANK YOU, RAUL.

CONSIDERING THAT IT'S JULY, I SUPPOSE IT WOULDN'T BE TOO LATE TO START WORKING ON NEXT YEAR'S BUDGET, TOO. I REMIND EVERYONE THAT I'VE ALLOWED THIS MEETING TO CONTINUE BEYOND OUR INTENDED BREAK. WE WILL TAKE A BREAK. CAN I FIND OUT HOW MANY PEOPLE ARE QUEUED UP WAITING TO SPEAK. TWO. SO LET'S SAY THOSE TWO ARE THE ONLY ONES BEFORE THE BREAK.

>>KEITH TEARE: KEITH TEARE IN MY CAPACITY AS BOARD OF DIRECTORS OF SNAPNAMES.

TWO COMMENTS. FIRST PERTAINING TO THE BUDGET AS A WHOLE. IT FEELS TO ME AS IF THE DISCUSSION OF THE BUDGET IS VERY TACTICAL. WHAT I MEAN BY THAT IS IT'S ABOUT HOW TO GET FUNDS FROM THE EXISTING MEANS OF GETTING FUNDS. THAT IS TO SAY, PRIMARILY THE REGISTRARS, AND IT WOULD SEEM TO ME THAT OVER THE NEXT 12 MONTHS THERE WOULD BE A LOT OF BENEFITS TO ICANN AND THE COMMUNITY FROM A DISCUSSION THAT BECAME MORE STRATEGIC; THAT IS TO SAY, IS THAT THE BEST WAY FOR ICANN TO BE FUNDED. AND I KNOW THAT THIS ISN'T THE APPROPRIATE DISCUSSION FOR THAT, BUT JUST FOR WHAT IT'S WORTH, I PERSONALLY FEEL AS IF THERE ARE BETTER WAYS FOR ICANN TO BE FUNDED THAN THE CURRENT ONES. MY SECOND POINT, AND THIS IS REALLY VERY MUCH WITH MY SNAPNAMES HAT ON, THE BOARD AND THE STAFF ARE PROBABLY AWARE OF A LOSS OF CORRIDOR DISCUSSIONS PERTAINING TO THE ACCREDITATION OF REGISTRARS. AND GIVEN THAT THE BUDGET IS HIGHLY DEPENDENT ON THE REGISTRARS, THIS BECOMES SOMEWHAT OF A SENSITIVE ISSUE. AND THERE ARE -- IT IS MY UNDERSTANDING, AT LEAST, SOMEWHERE BETWEEN 100 AND 130 NEW ACCREDITATIONS OF REGISTRARS BEING BEEN APPROVED OR WILL BE APPROVED VERY RECENTLY. AND THOSE REGISTRARS ARE NOT REAL IN THE SENSE THAT THEY HAVE NO INTENTION OF SELLING DOMAIN NAMES, BUT THE PURPOSE OF THEIR EXISTENCE IS PRIMARILY TO COMPETE IN THE SECONDARY NAME MARKET FOR THE THREADS THAT THE REGISTRY MAKES AVAILABLE FOR NAME DROPS EVERY DAY. AND FURTHER, THAT THOSE REGISTRARS, ALTHOUGH VERY MUCH WITHIN ICANN'S RULES, ARE ACTUALLY SUBSIDIARIES IN SOME WAY OF EXISTING REGISTRARS WHO PLAY IN THAT GAME. NOW, MY COMPANY IS NEGATIVELY AFFECTED BY THAT, AS YOU CAN IMAGINE, AND WE FEEL THAT AS GOOD MEMBERS OF THE COMMUNITY WHO HAVE AVOIDED LITIGATION OR SHOUTING MATCHES, WE ARE VERY ADVERSELY AFFECTED BY THAT. AND NOT ONLY THAT, THERE ARE IMPLICATIONS WHICH WE DO NOT HOLD, THAT THERE IS A RELATIONSHIP BETWEEN THESE ACCREDITATIONS AND THE BUDGET PROCESS. SO I'D LIKE TO GIVE THE BOARD AN OPPORTUNITY TO COMMENT ON THAT AND TO CLARIFY.

>>VINT CERF: THANK YOU, KEITH. PAUL, I THINK YOU HAD A RESPONSE TO BEGIN WITH.

>>PAUL TWOMEY: KEITH, THANKS FOR THE QUESTIONS AND THANK YOU PARTICULARLY FOR THE TURN IN THE SPIRIT IN WHICH YOU PUT THE SECOND ONE, BECAUSE I APPRECIATE THE CALMNESS OF YOUR APPROACH ON THIS TOPIC.

I AM AWARE OF THE VARIETIES OF CORRIDOR TALK AS YOU PUT IT SO I WILL MAKE SOME CLEAR, SIMPLE FACTS. I WILL LEAVE IT TO THE CHAIR AND BOARD TO MAKE OTHER OBSERVATIONS BUT I WANT TO PUT SOME CLEAR, SIMPLE FACTS ON THE TABLE.

WE RECEIVED A NUMBER OF APPLICATIONS FROM A PARTICULAR APPLICANT EARLY THIS YEAR IN THE NUMBERS OF IN THE TWENTIES, WHICH WAS THE FIRST TIME THAT WE HAD RECEIVED -- IF I GO BACK ONE STEP, ICANN HAS NEVER, AT A STAFF LEVEL, IN MY KNOWLEDGE, CERTAINLY UNDER MY ROLE AS THE PRESIDENT, RECEIVED AND PROCESSED AN ACCREDITED REGISTRAR IN A MANNER IN WHICH EITHER WE WENT AND SOUGHT FOR THOSE ACCREDITATIONS OR WE TRIED IN ANY WAY TO MANIPULATE THE FLOW OF THOSE ACCREDITATIONS. THEY WERE REVIEWED BY THE INTERNAL LEGAL TEAM AND THE REGISTRAR ACCREDITATION TEAM AND PROCESSED. AS YOU POINTED OUT EARLIER THIS YEAR WE RECEIVED A GROUP OF APPLICATIONS FROM ONE INDIVIDUAL OR ENTITIES ASSOCIATED WITH ONE PARTICULAR INDIVIDUAL. THIS WAS A SURPRISE TO US. WE HAD NOT RECEIVED THIS PATTERN BEFORE. AND WE ACTUALLY UNDERTOOK A LEGAL EVALUATION OF WHAT WAS THE STATUS WE WERE FACED IN ESTABLISHING SUCH ACCREDITATIONS AND WE WENT TO THE BOARD AND ASKED THE BOARD'S ADVICE. THE BOARD RESOLVED TWO THINGS. ONE WAS THAT THERE WAS NO LEGAL GROUNDS FOR US TO DO ANYTHING ELSE BUT TO PROCESS THESE ACCREDITATIONS UNDER OUR PROCESSES AND TO ASSURE THAT THEY WERE MEETING ALL THE TESTS OF THAT, AND SECONDLY ASKED FOR THE ESTABLISHMENT OF AN EXPERT PANEL TO HELP PULL TOGETHER EXPERT INFORMATION ON THE NATURE OF THIS MARKETPLACE. SOME INITIAL REQUESTS HAVE ALREADY STARTED AROUND THE POTENTIAL FORMATION OF THAT EXPERT PANEL. ANY MEMBERS OF THE COMMUNITY HERE TO WISH TO SPEAK TO ME ABOUT WAYS IN WHICH WE SHOULD PUT TOGETHER SUCH AN EXPERT PANEL TO FURTHER ILLUMINATE FOR THE BOARD THE FACTS AROUND THIS PHENOMENON, I'D BE HAPPY TO RECEIVE. WE HAVE SINCE RECEIVED, AS YOU POINTED OUT, A FURTHER RANGE OF ACCREDITATION APPLICATIONS. I WANT TO MAKE TWO OBSERVATIONS VERY, VERY CLEAR. WE HAVE NOT SOUGHT THESE. NO MEMBER OF THE STAFF OF ICANN HAS SOUGHT THESE. THEY ARE, IF ANYTHING, AN EMBARRASSMENT TO THE ICANN STAFF IN THE SENSE OF -- AND I USE THAT WORD BUT NOT PEJORATIVELY. I'M NOT TRYING TO SAY ANYTHING ABOUT THOSE MAKING THE APPLICATIONS, BUT THEY HAVE ARRIVED WITHOUT OUR KNOWLEDGE. THERE IS NO CAUSAL RELATIONSHIP BETWEEN THE RECEIPT OF THOSE AND THE BUDGET DISCUSSION.

IN FACT, IT HAS MADE THE BUDGET DISCUSSION MORE DIFFICULT FOR THE STAFF. BUT WE ARE BOUND TO FOLLOW OUR PROCEDURES AND DO WHAT WE UNDERSTAND IS OUR LEGAL POSITION AT THE MOMENT. AND THE BOARD HAS, AS I SAID, BEEN ASKED FOR ITS ADVICE. THE ONE FURTHER COMMENT I WOULD MAKE, ONE OF THE THINGS WE ARE REQUIRED TO DO, OF COURSE, IS TO ENSURE FULL COMPLIANCE. ONE OF THE THINGS WE DO NEED IN THE BUDGET IS MORE FUNDING FOR COMPLIANCE BECAUSE THIS INDICATES -- OUR WORKLOAD ON COMPLIANCE HAS MASSIVELY INCREASED IN THE LAST 12 MONTHS AND WE DON'T HAVE THE RESOURCES FOR T THAT DOESN'T TAKE AWAY OUR RESPONSIBILITY FOR COMPLIANCE. AND IF ANYONE WANTS TO PUT IN A COMPLAINT ABOUT OUR LACK OF COMPLIANCE WITH REGISTRAR AGREEMENTS, WE WILL INVESTIGATE THOSE AND IF THERE IS ANY LACK OF COMPLIANCE WITH THOSE AGREEMENTS WE WILL ACT UPON THOSE AS WE'RE REQUIRED TO.

>>VINT CERF: LET ME ADD A LITTLE BIT MORE TO THAT. WHEN THE ORIGINAL, UNEXPECTEDLY LARGE REQUEST FOR REGISTRATIONS ARRIVED, THE STAFF IN FACT ASKED THE BOARD TO CONSIDER WHETHER AN ACTION SHOULD BE TAKEN, WHETHER, IN FACT, THEY SUSPENDED THE ACCREDITATIONS AND THEN TALKED WITH THE BOARD. THE BOARD ASKED WHETHER WE HAD GROUNDS FOR REJECTING THOSE ACCREDITATION REQUESTS. AND WE FRANKLY DID NOT HAVE ESTABLISHED RULES OR ESTABLISHED CRITERIA THAT WOULD ALLOW US TO REJECT THEM.

IF THERE ARE, IN FACT, NONCOMPLIANT REGISTRARS, AS PAUL SAYS, THAT'S SOMETHING WE CAN ACT ON. I AM VERY COGNIZANT OF WHAT APPEARS TO BE AN ABUSIVE BEHAVIOR; AT LEAST IT IS A DEVIATION OF SUBSTANTIAL QUANTITY FROM THE ORIGINAL EXPECTATION OF THE WAY A REGISTRAR WOULD FUNCTION. IF WE NEED BETTER CRITERIA, THERE ARE TWO THINGS TO BE DONE. ONE, WE WELCOME SUGGESTIONS FROM ALL OF THE INTERESTED CONSTITUENCIES ABOUT WHAT THOSE CRITERIA COULD BE. AND SECOND, IF WE'RE GOING TO CREATE NEW CRITERIA FOR ACCREDITATION, I SUSPECT THIS WILL REQUIRE A POLICY DEVELOPMENT PROCESS. SO THOSE TWO THINGS, I BELIEVE, ARE IMPORTANT ELEMENTS IN DEALING WITH THIS ANOMALOUS SITUATION. ARE THERE ANY OTHER COMMENTS FROM THE BOARD? KEITH.

>>KEITH TEARE: JUST AS A PRACTICAL POINT, THE SOLE MOTIVATION FOR THE EXISTENCE OF THESE REGISTRARS GOES AWAY WERE THE WAIT LIST SERVICE WERE TO BE OPERATIVE. SO THE DELAY IN SERVICE IMPACTS THAT.

>>VINT CERF: IF ANYONE HERE IS FAMILIAR WITH CHESS YOU'LL KNOW WHAT A PINNED PIECE IS AND WE HAVE A VERY PECULIAR, COMPLEX STALEMATE RIGHT NOW WITH REGARD TO THESE VARIOUS COMMENTS. ALEX.

>>ALEJANDRO PISANTY: I WOULD LIKE TO MAKE A VERY GENERAL COMMENT ON THE BUDGET.

WHEN I HAVE A CHANCE TO LOOK AT DIFFERENT PARTS OF THE BUDGET AND DISCUSS SOME OF THE PLANNING THAT HAS BEEN BEHIND IT AND SO FORTH, I CAN SEE A NUMBER OF DIFFERENT COMMUNITY DEMANDS ARE BEING RESPONDED TO. AT SOME POINT, IT SEEMED, WHEN WE GO LINE ITEM BY LINE ITEM, WE SAY VERY GOOD, THIS IS VERY NICE, REASONABLE. I WAS ACTUALLY VERY HAPPY TO SEE SOME THINGS BEING RESPONDED TO WITH A FULL-TIME EQUIVALENT OR HALF-TIME PERSON OR ONE AND A HALF AND SO FORTH. AT SOME POINT THERE WERE SO MANY THINGS I SAID TO MYSELF LET'S SEE HOW MUCH THIS IS COSTING. I BEGAN LOOKING AT THE PRICES OF THE ITEMS AND EACH OF THEM SEEMED PRETTY REASONABLE, IN THE CONTEXT, OF COURSE, OF U.S. SALARIES AND U.S. CONDITIONS AND U.S. COSTS, WHICH ARE THE ONES THAT ICANN FACES MOSTLY, EXCEPT IT MAY BE EVEN MORE EXPENSIVE IF WE HAVE OPERATIONS IN EUROPE, FOR EXAMPLE. AGAIN, WHEN THIS SEEMED TO PILE UP INTO A LOT OF MONEY, I WENT BACK AND CHECKED THE COST OF THE LINE ITEMS THAT I WAS ABLE TO LOOK AT, AND ASSESS PERSONALLY. AND THERE WAS REALLY NOT MUCH THAT ONE COULD DO TO REDUCE THEM. I THINK THAT WE ALL APPROACH BUDGETS FROM THE HOME TO ANY LARGE ORGANIZATION IN THIS TWOFOLD APPROACH WHERE WE FIRST TRY TO REDUCE THE PRICE OF FIXED LINE ITEM AND THE OVERALL. THERE WAS NOT MUCH CHANCE FOR REDUCING THE COST OF MANY OF THE ITEMS. AND AT SOME POINT, AFTER THAT, I ASKED MYSELF, OKAY, WHAT CAN GO? THE MOST PRIORITY IN THINGS. AND HONESTLY I THINK THE BUDGET PRESENTS A VERY BALANCED VIEW OF THE NEEDS OF THE COMMUNITY AND THE NEEDS FOR ICANN TO BE ABLE TO RESPOND BOTH TO PAST AND TO THE UPCOMING CHALLENGES, BOTH TO OPERATIONS AND TO THE ABILITY TO OPERATE STRATEGICALLY, TO BE A NIMBLE ORGANIZATION. IT IS NOT NECESSARILY BY BEING TOO SMALL. IT'S NOT THAT IT'S TOO SMALL, BUT IT'S NOT FAST. IT DOESN'T HAVE THE CAPABILITY TO RESPOND S! IMULTANEOUSLYTO CHALLENGES AND IT BECOMES SLOW. AND I WOULD CALL ON MANY OF THE PEOPLE WHO HAVE DONE THIS EXTREMELY GOOD WORK IN GREAT DETAIL TO ASK THEMSELVES WHETHER IF THEY WERE IN SOME OTHER CONSTITUENCY, WOULD THEY SEE THE ITEMS THAT FOR THEM ARE PRIORITY. FOR EXAMPLE, AS SOMEONE OPERATING GTLDS, IF THEY WERE OPERATING CCTLDS OR ADDRESS REGISTRIES, WOULD THEY SEE SOME OF THE PRIORITY ITEMS AS SOMETHING LESS THAN A PRIORITY? AND SECOND, IN THAT FINAL CONSIDERATION HERE, A WELL ARCHITECTED ITEM IS AN EXTREMELY IMPORTANT THING TO HAVE. IT'S NOT ONLY THE SUM OF ITS PIECES. IT'S NOT ONLY THE SUM OF ITS SERVICES. AND THE BUDGET CANNOT BE CONSIDERED ONLY AS A SUM OF THE INDIVIDUAL COSTS OF PROVIDING THE SPECIFIC SERVICES TO THE SPECIFIC CLIENTS, IF WE CAN CALL THEM THAT WAY, WHO ACTUALLY GET AN IMMEDIATE SERVICE LIKE IANA FUNCTIONS AND SO FORTH. THE GREATER SERVICE THAT ICANN IS PERFORMING AS A MODEL OF ORGANIZATION IN THE INTERNET COMMUNITY IS A COMPLETELY UNIQUE AND ORIGINAL PRODUCT OF THE INTERNET COMMUNITY, IS FAR MORE VALUABLE AND IT HAS TO BE REFLECTED IN THIS BUDGET, WHICH IS NOT LARGER BUT ONLY MORE COMPLETE.

>>VINT CERF: THANK YOU VERY MUCH, ALEX. I THINK WE HAVE --

>>IVAN MOURA CAMPOS: VINT, MAY I SAY A COUPLE WORDS?

>>VINT CERF: CERTAINLY.

>>IVAN MOURA CAMPOS: JUST A SHORT COMMENT AND I WOULD LIKE TO REASSURE KEITH WHO SPOKE ABOUT ALTERNATE SOURCES OF FUNDING THAT NOT ONLY THE STAFF BUT THE FULL BOARD IS VERY KEEN ON THAT. REST ASSURED, WE'RE GOING TO WORK ON THAT.

>>VINT CERF: THANK YOU VERY MUCH, IVAN.

WE HAVE KEN FOCKLER, AND THEN ONE OTHER, AND THEN WE'LL TAKE A BREAK.

>>KEN FOCKLER: THANK YOU. I WANTED TO GET -- PARDON? WHO AM I? I'M KEN FOCKLER, IVAN. YOU KNOW THAT.

I WANTED TO SEEK SOME CLARIFICATION ON THE ITEM INVOLVING THE HOPED-FOR REVENUE FROM NEW SPONSORED TLDS. AND AS I READ THE BUDGET, IT CALLS FOR -- AND I REALIZE THIS IS A LOT OF ESTIMATING. CALLS FOR 600,000, PERHAPS AVERAGED OVER SIX NEW STLDS. AND IN OUR CONVERSATIONS IN CONSTITUENCY MEETINGS AND OTHERS, I THINK WE DID POINT OUT AND GOT SOME ACKNOWLEDGEMENT THAT YOU CERTAINLY DON'T WANT TO PUT ANY IMPEDIMENTS ON NEW PEOPLE STARTING UP, BECAUSE THOSE ARE THE ONES WHO ARE GOING TO BE PROVIDING LOTS OF FUTURE REVENUE FOR YOU. AN AVERAGE OF SIX WITH 100,000 SUGGESTS SOME MIGHT BE MORE, WHICH SEEMS TO SUGGEST SOMEBODY THINKS THEY COULD -- SOME OF THESE NEW CCTLDS MIGHT BE INSTANTLY ABLE TO BE IN THE REALM OF COM AND NET THAT ARE PAYING 132,000. I HAVE A LITTLE TROUBLE VISUALIZING THAT. I HOPE SOME OF THEM CAN. I'M NOT SURE IF THEY ALL CAN. SO I GUESS I'M ASKING THREE QUESTIONS. WE ARE TALKING AN AVERAGE. WHAT SORT OF DETERMINATIONS, CONVERSATIONS SHOULD BE WE HAVING TO DETERMINE WHAT THAT MIGHT BE. AND IF IN THOSE DISCUSSIONS -- THIRD PART, LAST PART -- IF IN THOSE DISCUSSIONS IT DOESN'T SEEM TO ADD UP TO 600,000, CAN YOU LIVE WITH THAT? CAN YOU -- ARE YOU ADAPTABLE? OR WILL YOU FORCE FIT WHATEVER GROUP OF SELECTED TLDS YOU COME UP WITH TO THE 600,000 FIGURE?

>>VINT CERF: PAUL?

>>PAUL TWOMEY: OKAY. THANKS FOR THE QUESTION. SORRY, TOO MANY K'S.

TO COME TO KEITH'S QUESTION, TO GO BACK TO THE K'S AGAIN, I TALKED WITH THE CONSULTATION THAT TOOK PLACE AROUND THIS ONE YEAR BUDGET, AND IN PART OF THAT, ONE OF THE THINGS WE GOT A VERY CONSISTENT MESSAGE FROM MANY PLAYERS, INCLUDING SOME OF THE REGISTRIES, WAS THAT THE REGISTRIES' CONTRIBUTIONS AND INCOME THAT'S CONTRIBUTED BY THE REGISTRIES IS SOMETHING THAT SHOULD BE LOOKED AT IN THE LONGER TERM. AND CLEARLY ONE OF THE MECHANISMS THAT'S AVAILABLE FOR THAT IS AS AGREEMENTS COME UP, EITHER NEW ONES OR REBIDS OF EXISTING ONES, THERE'S THE OPPORTUNITY TO CONSIDER HOW YOU ACTUALLY MAKE THAT CHANGE. IN THE SPIRIT OF REFLECTING THOSE CONVERSATIONS, AN ITEM WAS FELT THAT IT WAS NECESSARY, THE ONLY ONES WE COULD LOOK AT POTENTIALLY THIS YEAR WERE THE NEW STLDS IN THE BEGINNING OF THE BUDGET PROCESS. THE $600,000 NUMBER IS JUST -- IT'S LITTLE MORE THAN A NUMBER. IT'S A RECOGNITION THAT POTENTIALLY THERE WAS SOME INCOME THAT MIGHT BE ABLE TO BE ACHIEVED THAT WAY. BUT IT DOES NOT -- IS NOT BASED ON ANY EVALUATION OF STLD APPLICATIONS. IT WAS A REFLECTION THAT THE BOARD HAD IN THAT STLD APPLICATION PROCESS RECOGNIZED AND MANDATED AN EVALUATION AND COMMERCIAL AND TECHNICAL NEGOTIATIONS AS PART OF THAT. WE WON'T KNOW WHAT THAT NUMBER IS UNTIL THE WHOLE PROCESS IS FINISHED AND THE YEAR IS FINISHED. AND WE HAVE MADE THAT CLEAR IN CONSULTATION, AND WE'VE MADE THAT CLEAR IN THE PRESENTATION WE PUT TO THE BOARD. AT THE SAME TIME, WE DID THINK IT WAS RESPONSIBLE TO TRY TO FLAG A NUMBER IN THE BUDGET ALONG, JUST SO PEOPLE KNEW THIS WAS A SERIOUS -- A SERIOUS EXPECTATION AROUND REGISTRY CONTRIBUTIONS. BUT WE ARE ALL COGNIZANT THAT WE DON'T KNOW WHAT THE SITUATION IS UNTIL MUCH LATER IN THE YEAR.

>>VINT CERF: MIKE PALAGE.

>>MICHAEL PALAGE: THANK YOU, PAUL, FOR PROVIDING THAT CLARIFICATION TO THE COMMUNITY. AND WE LOOK FORWARD TO THE NEGOTIATIONS.

I DO -- THE ONE POINT I DID WANT TO RAISE, THAT THERE IS A VALID, IF YOU WILL, CONCERN ON BEHALF OF KEN, WHEN ONE LOOKS AT THE CURRENT CONTRIBUTIONS OF THE CURRENT THREE STLDS, WHICH I BELIEVE THIS YEAR ONLY CONTRIBUTED $6,000. SO I THINK THAT WAS PART OF KEN'S CONCERN IN THE BIGGER PICTURE, AND THANKS FOR THE CLARIFICATION.

>>VINT CERF: OKAY. LET'S TAKE ONE MORE COMMENT FROM THE FLOOR.

>>SID'AHMED FADEL: MY NAME IS SID'AHMED FADEL,

AND I AM FROM MAURITANIA, AND I HAVE A QUESTION FOR MR. PAUL. IN YOUR PRESENTATION, YOU STATE THE EFFORT MADE BY ICANN FOR THE AFRINIC CREATION. SO MY QUESTION IS WHERE ARE WE NOW IN THAT PROCESS? IS THERE ANY FORMAL MOU WITH AFRINIC OR SUCH THINGS? THANK YOU.

>>PAUL TWOMEY: THANK YOU FOR THE QUESTION, AND IT'S A GOOD QUESTION.

I PUT IT ON NOTICE BECAUSE TODAY WE HAVE A FURTHER PRESENTATION FROM THE AFRINIC TEAM AND SOME OF THOSE QUESTIONS WILL EMERGE I THINK DURING THAT PRESENTATION. SO IF YOU DON'T MIND, CAN WE ANSWER THAT QUESTION LATER TODAY? THANK YOU.

>>VINT CERF: THANK YOU, PAUL. THAT APPEARS TO CONCLUDE COMMENTS FOR THIS PERIOD. WE WILL TAKE A BREAK NOW. I REALIZE THAT IT'S LATER THAN INTENDED, BUT LET'S RECONVENE AT 11:30, PLEASE. 11:30.

(BREAK).

>>VINT CERF: LADIES AND GENTLEMEN, I'D LIKE TO RECONVENE THE MEETING NOW, PLEASE.

WE'RE STILL MISSING A FEW BOARD MEMBERS, BUT WE ARE ALSO RUNNING OUT OF TIME. I'M GOING TO CHANGE THE ORDER OF THE AGENDA A LITTLE BIT BECAUSE OUR ESTEEMED GAC CHAIRMAN IS GOING TO HAVE TO DEPART EARLIER -- WELL, IN NOT VERY LONG FROM NOW, AND SO DO I. SO WE WANT TO GET HIS REPORT AND AN OPPORTUNITY FOR QUESTIONS TO BE OFFERED BEFORE HE HAS TO DEPART. SO WITH APOLOGIES TO CALVIN BROWNE, WHOM WE WILL INVITE UP MOMENTARILY, I'D LIKE TO CALL ON SHARIL TO GIVE THE GAC REPORT. AND WE WILL ENTERTAIN QUESTIONS ON THAT REPORT EXPLICITLY AS SOON AS HE'S COMPLETED IT.

>>SHARIL TARMIZI: THANK YOU VERY MUCH, VINT.

(SPEAKING MALAYSIAN) AS THEY SAY HERE IN MALAYSIA, SALAMAT DATANG, WHICH MEANS WELCOME. AND A VERY GOOD MORNING TO ALL. FIRST LET ME CLARIFY A FEW THINGS. I AM STANDING HERE IN MY CAPACITY AS CHAIRMAN OF THE -- MY NAME IS SHARIL TARMIZI. I AM STANDING HERE IN MY CAPACITY AS CHAIRMAN OF THE GOVERNMENTAL ADVISORY COMMITTEE OF ICANN. AND I SO HAPPEN TO BE MALAYSIAN AS WELL. AS A MALAYSIAN, I WOULD LIKE TO WELCOME YOU TO MALAYSIA, IF I HAVE NOT DONE SO FORMALLY. IF YOU WILL PERMIT ME, I WILL READ THE COMMUNIQUE OF THE GAC FOR YOUR CONSUMPTION. THE GOVERNMENTAL ADVISORY COMMITTEE, KNOWN AS GAC, OF THE -- OF ICANN MET IN KUALA LUMPUR 18TH TO 20TH JULY, 2004. THE PARTICIPATING GAC MEMBERS COMPRISED REPRESENTATIVES FROM 48 MEMBERS AND SEVEN OBSERVERS. THE GAC WELCOMED NEW MEMBERS WHO HAVE APPLIED FOR MEMBERSHIP SINCE THE ROME MEETING, NAMELY CAMEROUN, CROATIA, INDONESIA, LITHUANIA, UKRAINE, AND SLOVAKIA. GAC AFFIRMED THE ELECTION OF TWO ADDITIONAL VICE CHAIRS, PROFESSOR GABRIEL OLALERE AJAYI FROM NIGERIA AND LUIS PABLO HINOJOSA FROM MEXICO. GAC ALSO DECIDED TO PROCEED TO THE ELECTION OF CHAIR AND VICE CHAIRS DURING THE FIRST THREE MONTHS OF 2004. THE GAC PLENARY MET 18TH THROUGH 20TH OF JULY AND ADDRESSED THE FOLLOWING MATTERS. IN THE CONSULTATION WITH THE ICANN BOARD, THE GAC WELCOMED THE BRIEFINGS PROVIDED BY THE ICANN BOARD WHICH ADDRESSED CURRENT ICANN PRIORITIES AND INITIATIVES. IN PARTICULAR, THE GAC WELCOMED ICANN'S RECOGNITION OF THE VALUE AND SIGNIFICANCE OF PUBLIC POLICY INPUT BY THE GAC INTO THE ICANN COMMUNITY. OF PARTICULAR NOTE WAS ICANN'S REPORT ON THE DEVELOPMENT OF ITS CONTINGENCY PLAN. THE GAC WELCOMES THE PARTICIPATION BY GAC REPRESENTATIVES FROM ALL REGIONS, TOGETHER WITH MEMBERS OF THE ICANN COMMUNITY, ON AN ADVISORY BODY THAT WOULD BE CALLED UPON FOR ADVICE AND GUIDANCE. GAC CONTINUES TO ATTACH IMPORTANCE TO ICANN'S TIMELY REQUESTS FOR GAC ADVICE ON MATTERS WITH PUBLIC POLICY IMPLICATIONS. ON THE CONSULTATION WITH THE SECURITY AND STABILITY ADVISORY COMMITTEE OR SSAC, GAC RECEIVED A REPORT FROM THE SSAC ON THE REDIRECTION IN THE DOT-COM AND DOT NET DOMAINS AND THE ADOPTION OF DNSSEC IN THE REGISTRIES. GAC WELCOMES THE OFFER OF THE SSAC CHAIR TO PROVIDE UPDATES ON THESE TWO ISSUES AND ON PARTICULAR ON POLICY ASPECTS INVOLVED. THE GAC ALSO CONTINUED ITS CONSIDERATION OF THE UPDATING OF THE GAC CCTLD PRINCIPLES. FURTHER WORK WILL BE UNDERTAKEN DURING THE PERIOD UP TO THE CAPE TOWN MEETING, WHEN THE PAPER WILL BE FINALIZED. ON THE COUNTRY CODE NAME SUPPORTING ORGANIZATION OR CCNSO, THE GAC HELD A USEFUL DIALOGUE WITH THE CCNSO, LOOKS FORWARD TO WORKING WITH THE CCNSO, AND IN PARTICULAR LOOKS FORWARD TO THE ABILITY TO ESTABLISH A LIAISON GROUP. THE GAC WELCOMED THE INTENTION OF THE CCNSO TO OPERATE IN AN OPEN AND INCLUSIVE MANNER, WHICH FACILITATES DIALOGUE WITH ALL MEMBERS OF THE CCTLD COMMUNITY. THE GAC ENCOURAGES THE ONGOING EXTENSION OF THE CCNSO'S MEMBERSHIP. ON THE GNSO, THE GAC HAS EXTENDED ITS OUTREACH AND LIAISON WITH THE GNSO AND WILL ENGAGE IN REGULAR EXCHANGES WITH THE GNSO COUNCIL. IN THE NEAR TERM, THE GAC WILL FOCUS ON THE PUBLIC POLICY ASPECTS RELATED TO THE DEVELOPMENT OF A NEW WHOIS POLICY AND THE INTRODUCTION OF NEW TOP-LEVEL DOMAINS. ON THE ADDRESS SUPPORTING ORGANIZATION, THE GAC ENCOURAGES THE CONCLUSION OF THE MOU FORMING THE ADDRESS SUPPORTING ORGANIZATION. THE GAC REMAINS STRONGLY COMMITTED TO THE PRINCIPLES OF TRANSPARENT AND REPRESENTATIVE BOTTOM-UP PROCESSES WITHIN THE ICANN FRAMEWORK OF MULTISTAKEHOLDER PARTICIPATION. IN ORDER FOR THE -- TO ENCOURAGE THE DEVELOPMENT OF THE INTERNET IN THE AFRICAN REGION, THE GAC SUPPORTS THE RECOGNITION OF AFRINIC BY ICANN AS AN RIR. THE GAC CALLS FOR THE ESTABLISHMENT OF EFFECTIVE LIAISONS BETWEEN THE ASO AND THE GAC AS WELL AS OTHER RELEVANT SUPPORTING ORGANIZATIONS AND ADVISORY COMMITTEES. THE GAC RECOMMENDS THAT THE ASO LOOKS TO BROADEN ITS MEMBERSHIP TO INCLUDE A WIDER SPECTRUM OF INTERESTS. ON THE WIPO II RECOMMENDATIONS, THE GAC RECALLS THE STATEMENTS IT MADE IN THE GAC COMMUNIQUES IN THE RIO DE JANEIRO AND MONTREAL MEETINGS REGARDING WIPO II RECOMMENDATIONS. THE GAC THANKS THE JOINT WORKING GROUP FOR WIPO II PROCESS ISSUES, FOR ITS WORK, AND WELCOMES ITS FORTHCOMING FINAL REPORT. THE GAC ALSO CONDUCTED A REGIONAL FORUM ON SATURDAY 17TH JULY, 2004, WHICH HAD WORKSHOPS ON IDN AND IPV6. THE GAC RECOGNIZES THAT THE DEVELOPMENT AND INTRODUCTION OF IDN REQUIRES THE COLLABORATIVE AND COORDINATED EFFORTS BY VARIOUS PARTIES. THE GAC APPRECIATES THE INITIATIVE BY ICANN TO ORGANIZE THE IDN WORKSHOP ON 21ST JULY TO BRING TOGETHER THE VARIOUS STAKEHOLDERS NECESSARY SUCH AS LINGUISTIC EXPERTS, TECHNICAL EXPERTS, AND OTHER RELEVANT PARTIES TO FIND ACCEPTABLE SOLUTIONS FOR IDN DEPLOYMENT, TAKING INTO ACCOUNT ITS ADVICE IN MONTEVIDEO, WHETHER LINGUISTIC AND CULTURAL FACTORS CONSIDERED. GAC ENCOURAGES ICANN TO ENSURE THAT IDN STANDARDS AND LANGUAGE TABLES TAKE FULL ACCOUNT OF THE INPUT FROM ALL STAKEHOLDERS, INCLUDING THE LOCAL LANGUAGE COMMUNITIES CONCERNED. ON IPV6, THE GAC TAKES NOTE OF THE EFFORTS THAT HAVE BEEN MADE TOWARDS THE MIGRATION TO IPV6. THE CURRENT IPV6 STATUS AND VARIOUS SYSTEMS OF THE INTERNET, AND FUTURE WORK TO BE DONE. THE GAC WELCOMES THE ICANN BOARD'S DECISION AND THE SUBSEQUENT REVISION OF THE ADMINISTRATIVE PROCEDURE BY IANA, WHICH ALLOWS THE IPV6 ADDRESSES OF TLD NAME SERVERS TO BE ADDED TO THE ROOT ZONE. THE GAC SUPPORTS THE EFFECT OF ICANN TOWARDS THE DEPLOYMENT OF IPV6. AND TO END HERE, THE PROCEEDINGS AND PRESENTATIONS OF THE REGIONAL FORUM WILL BE PUBLISHED ON THE GAC WEB SITE SEPARATELY. I HAVE COME TO THE END OF MY COMMUNIQUE. BUT A FEW -- WELL, NOT QUITE. SORRY. I HAVE COME TO THE END OF THIS MORNING. NOW, GIVEN OUR COMMITMENT TO BOTH THE WORLD SUMMIT ON INFORMATION SOCIETY, WSIS, AND ICANN PROCESSES, THE GAC WELCOMED THE ICANN WORKSHOP ON WSIS, WHICH PERMITTED THE ICANN PUBLIC-PRIVATE, MULTISTAKEHOLDER PARTNERSHIP TO PRESENT ITS VIEWS REGARDING THE SPECIFIC ROLE OF THE ICANN COMMUNITY IN THE FORTHCOMING UNITED NATIONS WORKING GROUP ON INTERNET GOVERNANCE AND WSIS DELIBERATIONS.

NOW, MR. CHAIRMAN, THERE IS ONE MORE PARAGRAPH THAT I NEED TO READ. BUT I MUST SAY I AM READING IT AS THE CHAIR OF THE GOVERNMENTAL ADVISORY COMMITTEE. AND IT SAYS THE GOVERNMENTAL ADVISORY COMMITTEE EXPRESSES WARM THANKS TO THE GOVERNMENT OF MALAYSIA AND THE ORGANIZERS FOR HOSTING THE MEETING IN KUALA LUMPUR AND EXPRESSES ITS APPRECIATION FOR THE SPEAKERS WHO PARTICIPATED IN THE IDN AND IPV6 WORKSHOPS IN THE REGIONAL FORUM. THE GAC ALSO WARMLY THANKS ALL THOSE AMONGST THE ICANN COMMUNITY WHO HAVE CONTRIBUTED WITH THE GAC IN KUALA LUMPUR. THE NEXT GAC MEETINGS WILL BE IN CAPE TOWN ON THE 29TH OF NOVEMBER TO 2ND DECEMBER, INCLUDING THE REGIONAL FORUM. AND THERE ENDS MY PRESENTATION, MR. CHAIRMAN. AND MAY I SAY A PERSONAL THANK YOU TO ALL OF YOU. (APPLAUSE.)

>>VINT CERF: THANK YOU VERY MUCH, MR. CHAIRMAN.

LET ME ASK WHETHER THERE ARE QUESTIONS FOR THE GAC CHAIR AT THIS POINT. I SEE RAUL APPROACHING THE MICROPHONE.

>>RAUL ECHEBERRIA: THANK YOU, MR. CHAIRMAN.

THANK YOU FOR YOUR REPORT. I WOULD LIKE TO ASK YOU ABOUT YOUR POSITION IN RELATION WITH THE ASO MOU. SO WHAT DO YOU MEAN EXACTLY WITH THE BROADER MEMBERSHIP OF ASO?

>>VINT CERF: PLEASE, FEEL FREE TO RESPOND.

>>SHARIL TARMIZI: THANK YOU.

THANK YOU, RAUL. I THINK WHEN WE SAY BROADEN THE MEMBERSHIP, WHAT WE WOULD LIKE TO DO IS TO ACTUALLY SEE AN ALL-INCLUSIVE TOGETHER ASO WHICH IS COLLABORATING WITH THE VARIOUS PARTS OF THE ICANN COMMUNITY, AND NOT JUST A SMALL GROUPING OF A FEW PEOPLE WORKING ON A FEW SPECIFIC THINGS. BECAUSE WE HAVE TO WORK COLLABORATIVELY. WE LOOK, ACTUALLY, FORWARD TO HAVING MULTIPLE DIALOGUES WITH THE GROUP SO THAT WE CAN BETTER UNDERSTAND THE REQUIREMENTS AND HOW WE MAY BE ABLE TO CONTRIBUTE TO THE WORK.

>>VINT CERF: RAUL, IF I COULD SUGGEST AN INTERPRETATION OF THIS.

I THINK THAT WHAT IS BEING SAID IS THAT LIAISONS TO OTHER PORTIONS OF THE ICANN STRUCTURE WITHIN THE ASO ORGANIZATION WOULD BE WELCOMED. AND I THINK THAT'S PRIMARILY WHAT SHARIL IS GETTING AT.

>>SHARIL TARMIZI: THANK YOU, VINT, FOR SPEAKING ENGLISH CLEARLY.

BECAUSE I AM SPEAKING IN GAC-ESE.

>>RAUL ECHEBERRIA: THANK YOU.

ONLY A FEW COMMENTS. THE ASO IN THE FRAMEWORK OF THE MOU THAT IS BEING CONSIDERED IS OPEN TO ANY DIALOGUE ON AGREEMENTS WITH OTHER ORGANIZATIONS OR BODY OF ICANN STRUCTURE. THANK YOU.

>>VINT CERF: THANK YOU VERY MUCH, RAUL.

ARE THERE ANY OTHER QUESTIONS? ALL RIGHT. IN THAT CASE, THANK YOU VERY MUCH FOR THAT REPORT.

>>SHARIL TARMIZI: THANK YOU, VINT.

>>VINT CERF: WHAT I WOULD LIKE TO DO NOW IS TO CALL UPON CALVIN BROWNE, IF HE IS HERE, AND INVITE HIM TO REPORT TO US ON THE UPCOMING PLANS FOR THE CAPE TOWN MEETING IN DECEMBER.

CALVIN.

>>CALVIN BROWNE: THANK YOU, MR. CHAIR.

JUST TO GIVE YOU ALL A BRIEF RUNDOWN ON HOW THINGS ARE GOING AND A COUPLE OF THINGS THAT YOU NEED TO BE AWARE OF FOR THE CAPE TOWN MEETING, I JUST WISH TO POINT OUT THAT IT IS SUMMER HOLIDAYS. THERE'S GOING TO BE A LOT OF PEOPLE RETURNING FROM OVERSEAS, AND FLIGHTS INTO CAPE TOWN MIGHT BE CONSTRAINED. SO YOU WANT TO GET YOUR BOOKINGS DONE FOR CAPE TOWN AS SOON AS POSSIBLE. ALSO REMEMBER THAT YOU -- THAT JOHANNESBURG IS A SHORT DOMESTIC HOP FROM CAPE TOWN, A TWO-HOUR FLIGHT. SO ROUTING THROUGH JOHANNESBURG ALSO IS AN OPTION FOR THOSE OF YOU WHO FIND FLIGHTS UNAVAILABLE. WE HAVE ALSO ORGANIZED WITH OUR NATIONAL AIR CARRIER FOR ICANN DELEGATES. FURTHER DETAILS WILL BE AVAILABLE AT OUR WEB SITE. THAT'S ICANN CAPE TOWN.CO.ZA. THEN ANOTHER POINT, THE HOTELS, THE CONVENTION CENTER HOTEL HAS ONLY 400 ROOMS. 40 OF THEM HAVE ALREADY BEEN TAKEN AS WE SPEAK, FOR ICANN DELEGATES. SO I SUGGEST IF YOU ARE INTERESTED IN STAYING AT THE MAIN CONVENTION HOTEL, TO BOOK AS SOON AS POSSIBLE. AGAIN, FURTHER DETAILS ARE AVAILABLE ON THE WEB SITE. AS FAR AS OTHER HOTELS GO, THE FIRST TWO WEEKS IN CAPE TOWN ARE NOT OVERLY FULL, SO THERE IS EXCESS CAPACITY AVAILABLE. WE ARE STILL NEGOTIATING WITH THE HOTELS ACROSS THE ROAD FROM THE CONVENTION CENTER TO GET BETTER PRICES FOR ICANN DELEGATES. AT THE MOMENT, THE FIGURES THAT WE CAME UP WITH ARE, IN MY OPINION, A BIT TOO HIGH. SO YOU DON'T HAVE TO WORRY TOO MUCH IF YOU'RE GOING FOR SECONDARY HOTELS JUST YET. BUT PLEASE DO CHECK OUR WEB SITE FOR MORE DETAILS AND KEEP AN EYE ON IT TO ENSURE THAT YOU KNOW WHAT'S GOING ON.

THANK YOU.

>>VINT CERF: THANK YOU VERY MUCH.

ARE THERE ANY QUESTIONS FOR CALVIN? ALL RIGHT. THANK YOU VERY MUCH FOR THAT REPORT. I'D LIKE TO MOVE ON NOW TO THE RSSAC COMMITTEE REPORT AND CALL UPON SUZANNE WOOLF TO MAKE HER REPORT.

>>SUZANNE WOOLF: ALL RIGHT.

THANK YOU, VINT. GOOD MORNING, OR ALMOST AFTERNOON, LADIES AND GENTLEMEN. I AM HERE ON BEHALF OF THE ROOT SERVER SYSTEM ADVISORY COMMITTEE TO GIVE YOU ALL A BRIEF UPDATE ON ISSUES BEFORE THE COMMITTEE. AS MANY OF YOU KNOW, RSSAC IS ONE OF THE ORIGINAL ICANN ADVISORY COMMITTEES. WE ADVISE THE BOARD ON ISSUES PERTAINING TO OPERATION OF THE ROOT NAME SERVER. CONTENT OF THE ROOT ZONE IS OUT OF SCOPE FOR US EXCEPT FOR OPERATIONAL IMPACT SUCH AS CHANGES TO SOFTWARE THAT MIGHT BE REQUIRED TO SUPPORT CHANGES IN THE DATA. THE MEMBERS OF THE COMMITTEE ARE ROOT NAME SERVER OPERATORS AND OTHER LIAISONS AND OBSERVERS. OUR NEXT MEETING WILL BE THE 1ST OF AUGUST IN CONJUNCTION WITH THE SAN DIEGO IETF MEETING. FIRST A COUPLE OF BRIEF TECHNICAL UPDATES. ANY CAST DEPLOYMENT. THERE'S BEEN A LOT OF PROGRESS ON THAT. SEVERAL SERVERS HAVE ANNOUNCED NEW SITES SINCE ICANN ROME. THAT EFFORT WAS UNDERTAKEN ON THE ORDER OF A YEAR AND A HALF AGO TO INCREASE OVERALL SYSTEM RESILIENCE AGAINST ATTACK. AND SO FAR IT HAS BEEN A GREAT SUCCESS FOR US. INTEREST IN IDN IS GOOD NEWS FOR THE INTERNET. WE HAVE HEARD A GREAT DEAL ABOUT IT AT THIS MEETING. AND IT'S BEEN CLEARLY VERY, VERY IMPORTANT TO THE INTERNET COMMUNITY AS A WHOLE. PART OF THE GOOD NEWS, THOUGH, IS THIS REQUIRES NO ACTION BY ROOT SERVER OPERATORS. WE HAVE OCCASIONALLY BEEN ASKED ABOUT THAT. SO IT SEEMED WISE TO CLARIFY. CERTAINLY ONE OF THE SUBSTANTIVE ISSUES THAT HAS BEEN ADDRESSED BY THE COMMITTEE HAS BEEN THE INCLUSION OF IPV6 QUAD A ADDRESSES IN THE ROOT ZONE N ACCORDANCE WITH THE RSSAC RECOMMENDATION AS REVIEWED BY SSAC AND THE ICANN BOARD, IANA HAS BEGUN ADDING QUAD A TO THE ROOT ZONE. I BELIEVE PAUL TWOMEY SPOKE OF THAT IN HIS REPORT. IT'S IMPORTANT NEWS FOR THE FUTURE OF THE INTERNET. CONGRATULATIONS TO THE TLDS WHO HAVE SET UP IPV6 NAME SERVERS. WE WERE TOLD SEVERAL HAVE BEEN ADDED TO THE ROOT ZONE AND THERE ARE SEVERAL MORE PENDING. THE NEXT WORK FOR RSSAC WITH REGARDS TO IPV6 IS ADVICE TO IANA ON ADDING QUAD AS FOR THE ROOT NAME SERVERS THEMSELVES. THIS WILL COMPRISE A SEPARATE RECOMMENDATION AND IS CURRENTLY UNDER ANALYSIS. THERE ARE SOME TECHNICAL SUBTLETIES ABOUT THIS, BECAUSE THE ROOT SERVERS THEMSELVES ARE KIND OF A SPECIAL CASE, AND WE ARE LOOKING VERY, VERY CLOSELY JUST TO MAKE SURE THAT THERE ARE NO UNEXPECTED SIDE EFFECTS FROM ADDING QUAD AS FOR THE ROOT SERVERS THEMSELVES. ANOTHER LARGE ISSUE FOR US HAS BEEN DNS SECURITY. DNSSEC IS -- HAS ADDED EXTENSIONS TO THE DNS STANDARDS TO ALLOW FOR SIGNED DATA, WHICH PROVIDES ADDITIONAL ASSURANCE THAT YOU CAN'T GET TODAY THAT CRITICAL DNS DATA HAS NOT BEEN TAMPERED WITH. THE DNSSEC STANDARD IS ADVANCING WITHIN THE IETF. THERE'S BEEN A LONG DEVELOPMENT CYCLE ASSOCIATED WITH THIS, SEVERAL YEARS. RECENT ACCEPTANCE OF THE CURRENT SPEC BY THE WORKING GROUP IS A BIG MILESTONE. A NUMBER OF RSSAC MEMBERS HAVE CONTRIBUTED TO THE TECHNICAL SPECIFICATIONS AND ARE CURRENTLY ACTIVE IN IMPLEMENTATION AND TESTING AND DEPLOYMENT ACTIVITIES. THE RSSAC EXPECTS TO WORK WITH IANA AND ADVISE AS NEEDED ON THE ADMINISTRATIVE AND OPERATIONAL ISSUES AROUND DNSSEC FOR THE ROOT ZONE. AND THAT'S BEEN OUR MAJOR ACTIVITIES. GENERALLY, YOU CAN FIND US. YOU KNOW, THERE ARE ALWAYS SOME NUMBER OF US AT ICANN MEETINGS. WE ARE OFTEN INVITED TO CONTRIBUTE TO THE GAC AND OTHER ICANN-RELATED GROUPS TO DISCUSS OUR ACTIVITIES AND WHAT WE'RE UP TO AND WHAT ISSUES ARE IN FRONT OF US. WWW.ROOT-SERVERS.ORG IS NOT AN OFFICIAL RSSAC SITE BUT THAT'S WHERE MANY OF THE ROOT SERVER OPERATORS POST THEIR ACTIVITIES. AND ICANN MAINTAINS A SECTION ON THEIR WEB SITE FOR THE COMMITTEE AND A COMMENTS ADDRESS. SO PLEASE FEEL FREE TO DROP E-MAIL REGARDING ANY QUESTIONS OR COMMENTS YOU MIGHT HAVE. THANK YOU.

>>VINT CERF: THANK YOU VERY MUCH, SUZANNE.

MOVING RIGHT ALONG, WE'LL COME TO QUESTIONS IN A BIT, I ACTUALLY ASK WHETHER I COULD PERMUTE THE ORDER A LITTLE BIT. MR. CROCKER, WOULD YOU PERMIT THE POSSIBILITY OF POSTPONING YOUR REPORT UNTIL AFTER LUNCH? WOULD THIS BE POSSIBLE? I'M ONLY CONCERNED ABOUT PACE. I'D LIKE TO ASK, THEN, IF VITTORIO BERTOLA COULD BE AVAILABLE NOW RATHER THAN AFTER MR. CROCKER. SO, VITTORIO, I CALL ON YOU TO MAKE THE ALAC REPORT.

>>VITTORIO BERTOLA: OKAY.

THANK YOU, AND THIS IS THE REPORT ON THE ACTIVITIES OF THE AT-LARGE ADVISORY COMMITTEE. SO THIS IS JUST A BRIEF EXPLANATION ABOUT WHAT THE COMMITTEE IS AND DOES. WE ARE HERE TO ADVISE THE CORPORATION ABOUT THE INTERESTS OF THE INDIVIDUAL INTERNET USERS. AND OUR MAIN ACTIVITIES ARE BASICALLY DIVIDED IN TWO PARTS. ONE IS MAKING OUTREACH AND CONTACTING ORGANIZATIONS ALL AROUND THE WORLD AND ENCOURAGING THEM TO PARTICIPATE IN ICANN THROUGH OUR MECHANISM. AND THE OTHER PART IS INSIDE THE CORPORATION, ADVOCATE OPINIONS IN THE INTERESTS OF THE INDIVIDUAL INTERNET USERS IN THE POLICY-MAKING PROCESSES. SO THIS IS A VERY SHORT LIST OF WHAT WE HAVE BEEN DOING SINCE THE LAST ICANN MEETING IN ROME, WHICH A GOOD PART OF IT IS THE ORGANIZING PART, SO OUTREACH AND MANAGING APPLICATIONS AND ACCREDITING ORGANIZATIONS THAT WANT TO BECOME PART OF THE MECHANISM. AND WE HAVE BEEN WORKING ON A BUDGET REQUEST TO FINANCE OUR ACTIVITIES FOR THE NEXT YEAR. AND THEN WE'VE BEEN PARTICIPATING IN POLICY DEVELOPMENT AND PARTICULARLY IN THE GNSO ACTIVITIES, SUCH AS THE WHOIS TASK FORCE, THE DOT NET OR THE NEW TLDS. AND WE ALSO HAVE BEEN IN THE ORGANIZING GROUP FOR THE IDN WORKSHOP, FOR THE WSIS WORKSHOP IN KUALA LUMPUR. SO ABOUT AT-LARGE ORGANIZING AND ACCREDITATION OF STRUCTURES, WHAT'S HAPPENING IS WE ARE GOING ON TO ACCREDIT AND APPROVE ORGANIZATIONS. SO IN THE LAST FOUR MONTHS, WE HAVE ACCREDITED SIX MORE ORGANIZATIONS, SO WE NOW HAVE A LIST OF 16 ORGANIZATIONS OF INTERNET USERS ALL AROUND THE WORLD THAT ARE ACCREDITED TO PARTICIPATE IN THE AT-LARGE ADVISORY COMMITTEE ACTIVITIES. AND WE HAVE FIVE MORE APPLICATIONS UNDERWAY. SO THE LIST IS CONTINUING TO GROW. AND THIS IS THE CURRENT LIST OF CERTIFIED AT-LARGE STRUCTURES. AND IT DOESN'T FIT ANYMORE IN ONE SLIDE. SO THE NEXT MEETING, I WILL HAVE TO USE TWO. AND WE ALSO HAVE A LIST OF -- HERE IS THE LIST OF THE FIVE MORE APPLICATIONS THAT WE HAVE BEEN RECEIVING, AND WE ARE VERY HAPPY TO SEE THAT ONE IS FROM MALAYSIA. AND IN TERMS OF REGIONAL ORGANIZING, WE ARE EXPECTED TO START UP THE REGIONAL -- THE REGIONAL AT-LARGE ORGANIZATIONS, WHICH ARE GOING TO OPERATE AS COORDINATING POINTS FOR THE FIVE ICANN REGIONS. AND ESPECIALLY HERE, WE HAD QUITE SUCCESSFUL PUBLIC MEETING WITH PEOPLE FROM ALL OVER THE ASIA-PACIFIC REGION. AND THERE ARE ALREADY ADVANCED TALKS TO CREATE AN INITIAL SECRETARIAT FOR AN ASIA-PACIFIC AT-LARGE ORGANIZATION. IN AFRICA, THERE'S ACTIVITY ONGOING TO CREATE A FIRST SECRETARIAT. AND ALSO THE OTHER REGIONS ARE GOING ON, SO EUROPEAN, LATIN AMERICA, IT WOULD FOLLOW EVEN IN NORTH AMERICA, WHICH, UP TO NOW, HAS BEEN THE MOST DIFFICULT REGION FOR US, WE HAVE STARTED TO RECEIVE THE FIRST COUPLE OF APPLICATIONS.

SO THINGS ARE STARTING TO MOVE IN NORTH AMERICA AS WELL. SO THIS IS ABOUT BUDGET. I MEAN, AND THE BOARD WILL HAVE -- MAYBE NOTICE OUR INCREASED REQUEST FOR FUNDS. SO I WANTED TO EXPLAIN WHY DO WE NEED FUNDS. AND, ACTUALLY -- WELL, OUR MAIN SPENDING ITEMS, I WILL SAY TWO. SOMEONE TO HIRE A PART-TIME PERSON IN EACH REGION. WE THINK WE NEED TO HAVE ONE PART-TIME PERSON IN EACH OF THE ICANN REGIONS INSIDE THE ICANN STAFF TO HELP U

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