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Letter from Robert R. Parsons to Dan Halloran Regarding VeriSign WLS

Writer's Direct Line

May 8, 2003

Mr. Dan Halloran
Chief Registrar Liaison
Internet Corporation for Assigned Names and Numbers
4676 Admiralty Way, Suite 330
Marina Del Rey, CA 90292

Re: Proposed WLS Offering from VeriSign, Inc.

Dear Dan:

It recently came to our attention that Dotster, Inc. ("Dotster") has lodged a formal objection seeking to block VeriSign, Inc. from offering a Waiting List Service ("WLS") for domain names. We write to formally join in Dotster's objection. We adamantly oppose the WLS as proposed and intend to use any means available to block its implementation. Among other things, we are concerned about the following implications of the WLS:

First, the WLS will have a chilling effect on competition in the registrar market. VeriSign should not be permitted to use the positioning it enjoys as a result of its registry monopoly to gain an unfair trade advantage in the retail domain name market. Such use would be an abuse of VeriSign's monopoly power. Specifically, the WLS will eliminate and thus replace the various backorder processes developed and implemented by the various registrars who have them. Such universal product elimination will have a negative financial impact on those registrars, with no recourse or compensation, while giving VeriSign unilateral decision making power over the entire market.

Second, the pricing is arbitrary and there is no independent review. VeriSign has made no attempt to offer meaningful data to support the price proposed. Given VeriSign's monopoly of COM and NET registry services, and that the WLS again creates a monopoly situation, it is certainly reasonable to expect that the process and data used to determine that price point be reviewed independently. Indeed, the WLS will eliminate all competition in the backorder area, thus removing the benefit competitive forces have on backorder pricing.

Third, the WLS will essentially eliminate all alternate forms of back ordering currently in the market. The fact that VeriSign has teamed with Snap Names on the WLS efforts is even more troubling given that Snap Names is using the resources of numerous registrars right now to pre-order expiring domain names. This elimination of competition is not only against public policy, but it would serve to give VeriSign a unique advantage over all registrars. The separation of the retail function of registering domain names should not be diminished by once again allowing VeriSign to be both the registry and the registrar.

We therefore strongly encourage ICANN to reconsider its approval of the WLS. At a minimum, ICANN should require a consensus position among registrars with respect to this issue which is so potentially harmful to the registrar community. As you probably know, this issue has been repeatedly discussed among registrars and no consensus has ever been reached. In fact, the majority of the registrars are not in favor of it and the Names Council recommended against it. If no consensus position can be reached, then ICANN should prohibit the WLS entirely.

Very truly yours,



Robert R. Parsons

Domain Name System
Internationalized Domain Name ,IDN,"IDNs are domain names that include characters used in the local representation of languages that are not written with the twenty-six letters of the basic Latin alphabet ""a-z"". An IDN can contain Latin letters with diacritical marks, as required by many European languages, or may consist of characters from non-Latin scripts such as Arabic or Chinese. Many languages also use other types of digits than the European ""0-9"". The basic Latin alphabet together with the European-Arabic digits are, for the purpose of domain names, termed ""ASCII characters"" (ASCII = American Standard Code for Information Interchange). These are also included in the broader range of ""Unicode characters"" that provides the basis for IDNs. The ""hostname rule"" requires that all domain names of the type under consideration here are stored in the DNS using only the ASCII characters listed above, with the one further addition of the hyphen ""-"". The Unicode form of an IDN therefore requires special encoding before it is entered into the DNS. The following terminology is used when distinguishing between these forms: A domain name consists of a series of ""labels"" (separated by ""dots""). The ASCII form of an IDN label is termed an ""A-label"". All operations defined in the DNS protocol use A-labels exclusively. The Unicode form, which a user expects to be displayed, is termed a ""U-label"". The difference may be illustrated with the Hindi word for ""test"" — परीका — appearing here as a U-label would (in the Devanagari script). A special form of ""ASCII compatible encoding"" (abbreviated ACE) is applied to this to produce the corresponding A-label: xn--11b5bs1di. A domain name that only includes ASCII letters, digits, and hyphens is termed an ""LDH label"". Although the definitions of A-labels and LDH-labels overlap, a name consisting exclusively of LDH labels, such as"""" is not an IDN."