News Review | ICANN Pays Senior VP Sally Costerton Secret Contract $$$

Domain Mondo's weekly internet domain news review (NR 2017-10-15) with analysis and opinion: Features •  1) ICANN Pays Senior VP Sally Costerton Secret Contract $$$, 2) Other ICANN news, 3) Names, Domains & Trademarks: Universal Acceptance & IDNs, 4) ICYMI Internet Domain News, 5) Most Read Posts.

1) ICANN Pays Senior Vice President Sally Costerton Secret Contract $$$

California Corporations Code - Nonprofit Public Benefit Corporations: "6813 ... (b) Every director, officer, agent or member of any corporation who, with intent to defraud, destroys, alters, mutilates or falsifies any of the books, papers, writings or securities belonging to the corporation or makes or concurs in omitting to make any material entry in any book of accounts or other record or document kept by the corporation is guilty of a crime. (c) Each crime specified in this section is punishable by imprisonment in state prison ..." (emphasis added)

Should ICANN be run like a "chummy private club" or a nonprofit public benefit corporation with international scope and responsibilities, including duties to be accountable and transparent to the global internet community, meeting at least the baseline minimums required of all nonprofits jurisdictionally situated in California (US), and preferably far more than those minimums, since "Public-benefit nonprofit corporations are ... organized for the general public benefit, rather than for the interest of its members." 

In pursuit of answers to those questions and more, as most readers know, I first questioned on May 28, 2017, ICANN's Form 990 filing (FY16 ending June 30, 2016) published by ICANN on May 15, 2017, for review by the global internet community as required by the U.S. Department of Treasury's IRS (ICANN has IRC 501(c)(3) tax status).

My May 28th inquiry generated a partial answer from ICANN on July 13, 2017, disclosing a total of $114,203.24 paid in FY16 to ICANN Chairman Steve Crocker's personal corporation, Shinkuro, Inc., not disclosed on ICANN's filed FY16 Form 990. 

I responded on July 17, 2017, asking again for full disclosure of all amounts paid to all ICANN directors and officers, directly and indirectly, noting specifically:

"... completely missing from ICANN’s [Form 990] list of 39 “Officers, Directors, Trustees, Key Employees, and Highest Compensated Employees,” is Sally Costerton, Sr. Advisor To President & Senior Vice President, Global Stakeholder Engagement, who is also an “Executive Team Member” according to ICANN’s organization management chart (pdf) and has been employed as a “Vice President” of ICANN since 2012 according to her profile at icannwiki.org."

ICANN CFO Xavier Calvez replied on July 18, 2017, as I disclosed in News Review: ICANN Accountability, FY16 IRS Form 990 Redux | DomainMondo.com:

"Thank you for your note below [July 17 email]. I acknowledge and agree that the document posted on 13 July in response to your questions left unanswered the specific question that you highlighted in the paragraph referenced below in quotes. This question is perfectly relevant to the topic of disclosures of information on compensation of directors, officers, key employees, etc… and answering it will help providing clarity and transparency on this matter which is technically complex and subject to legitimate and useful public scrutiny. The discussion you offered to explain further the quoted paragraph will be quite helpful to ensure we address fully your question, and I thank you for it. I suggest that we publish your email below and the response that I will provide in accordance with our Correspondence process. Thank you."--Xavier Calvez, ICANN CFO

ICANN finally responded October 9, 2017 (pdf):

 "... Part VII, Section A. Officers, Directors, Trustees, Key Employees, and Highest Compensated Employees” as reported by ICANN in the 2015 form 990, fully complies with the IRS requirements. For example, Sally Costerton is contracted via her company Sally Costerton Advisory Limited. Accordingly, under IRS instructions for the form 990, the compensation paid to Ms. Costerton’s company for her services is appropriately not included in the Part VII ..." 

Sally Costerton Advisory Limited website: sallycosterton.com

I responded to ICANN on October 13, 2017 (pdf)(embed below):

"Assuming arguendo, that what you have revealed and asserted (for the first time), in your correspondence of 09 October 2017, is true and correct, ICANN should have answered “Yes” to Form 990 Part IV 28(a), 28(b), and/or 28(c), instead of “No” ... And therefore ICANN should have completed and attached Schedule L (Part IV) to the Form 990 [disclosing amount paid to Sally Costerton Advisory Limited] .... there is no reference whatsoever in the Form 990 as filed, or on the public ICANN.org website, indicating the heretofore undisclosed “arrangement” between ICANN and its “Senior Vice President of Global Stakeholder Engagement” who is also “Senior Advisor To the President of ICANN” and an “ICANN Executive Team Member,” according to the ICANN Management Organization Chart (pdf) ....

"... such an arrangement with ICANN, which raises all kinds of questions about conflicts of interest, appearances of impropriety, organizational loyalty, etc., since Costerton has, apparently, since 2012, with the blessing of ICANN’s Board of Directors and top management, been simultaneously serving as ICANN Senior Vice President while also actively soliciting and servicing unknown clients and customers of her corporation “Sally Costerton Advisory Limited” ... your recent revelation indicates how much ICANN is still run like a “chummy private club” instead of a non-profit public benefit corporation with international scope and responsibilities ..." 

Full embed of my October 13, 2017 letter:

I heard back (via email) from ICANN CFO Xavier Calvez on October 13: "I am acknowledging receipt of the below email and its attachment. We will address as per our established Correspondence process."

2) Other ICANN news

a. ICANN Board Report September 2017 (pdf) - Covering 30 May 2017 – 28 August 2017.  "As of the end of July 2017, ICANN org has 397 people, which is 24 people less than the FY18 year-end budget projection of 421. Over the last three months, 15 joined and another 9 left."

b. ICANN GNSO Policy Briefing (pdf) for ICANN60 meeting in Abu Dhabi, 28 Oct - 3 Nov 2017.

c. ICANN Releases Findings from a Community-Wide Survey on Gender Diversity and Participation | ICANN.org

d. ICANN Webinar on Review Operating Standards | ICANN.org: Webinar Details and How to Attend Date: 19 October 2017 Time: 21:00 UTC To participate, RSVP to: mssi-secretariat @ icann.org to receive the dial-in information. More info at link above.

e. Request 17-4: DotMusic Limited and dotgay LLC | BAMC Recommendation on Reconsideration Request | ICANN.org: ".... The BAMC has considered the merits of Request 17-4, and, based on the foregoing, concludes that ICANN organization did not violate ICANN’s Mission, Commitments and Core Values or established ICANN policy(ies) in the Response to Joint DIDP Request. Accordingly, the BAMC recommends that the Board deny Request 17-4 ..."

f. New gTLD Subsequent Procedures PDP - October 2017 Newsletter | gnso.icann.org (pdf): ".... The co-chairs are forming a fifth Work Track in the PDP devoted solely to the issue of geographic names at the top level. Work Track 5 will have a shared leadership model between the GAC, ALAC, ccNSO, and GNSO. The co-chairs have asked the GAC, ALAC, ccNSO, and GNSO to each identify a co-leader for this effort. To date, the following people have been nominated: Annabeth Lange (ccNSO), Christopher Wilkinson (ALAC), and Martin Sutton (GNSO). The GAC has not yet released the name of its appointee. The Working Group is hoping to issue a formal call for volunteers prior to ICANN60 ...."

g. ICANN Management Organization Chart 06 Oct 2017 management-org-06oct17-en.pdf (pdf)

3) Names, Domains & Trademarks

•  Universal Acceptance | IDN World Report | idnworldreport.eu: "an uncomfortable fact: many of the fundamental systems and applications that make the Internet useful still do not support IDNs. Progress in this area will seem glacial to regular readers of this report. The fact that the progress is so slow is a reflection of both the complexity of the problem and the sporadic uptake of IDNs which is documented elsewhere in this report." (emphasis and link added)

•  50% of the domaining industry about to be washed away? Probably--OnlineDomain.com

•   ICANN.org: Do You Have a Domain Name? Here's What You Need to Know; and ICANN's Transfer Policy: 5 Things Every Domain Name Registrant Should Know--ICANN.org

•  Trademark Rights Paramount to Contract Rights for Domain Names | IPLegalCorner.com

4) ICYMI Internet Domain News 

• Digital Trade Agreements Failing to Reflect Internet Community Input: UNCTAD | Electronic Frontier Foundation | eff.org: "... the need for aligning trade processes with multi-stakeholder values such as transparency, openness, and inclusive peer-to-peer participation by any interested party on an equal-footing ..."
• DNS a 'Victim of its Own Success' | darkreading.com: "..."The cheaper the device, the more you can fear it," [Dr. Paul] Vixie says. "I expect more Mirais" to emerge, he adds, because locking down IoT devices is a major cost that doesn't jive economically with low-cost consumer devices." [link added]
• Internet freedom in Africa matters | sabc.co.za:
• Iran's New Internet Minister Isn’t Delivering on Internet Freedom Promises: "Rouhani administration seemed to be expanding internet access, but the threat of censorship remains strong."--Motherboard.vice.com
• Internet Freedom Festival, 5-9 March 2018, Valencia, Spain--InternetFreedomFestival.org 

5) Most read posts (# of pageviews Sun-Sat) this past week on DomainMondo.com: 

1. News Review | RySG Requests $$$ and "Detailed Accounting" From ICANN

2. News Review | Esther Dyson Interview, ICANN Founding Board Chair

3. Knotel CEO Says Company Plans to Expand Internationally (video)

4. Hearing on 21st Century Trade Barriers & Cross Border Data Flow Policies 

5. A Map of Internet Censorship Around the World (infographic) 

6. Hackers Will Pose A Greater Cybersecurity Threat In 2018 (video)

-- John Poole, Editor, Domain Mondo 

feedback & comments via twitter @DomainMondo
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DISCLAIMER

ICANNgate: Attorney Flip Petillion On Holding ICANN Accountable (podcast)

Code & Conduit Podcast: Holding ICANN Accountable | Interview of Attorney Flip Petillion

Critics of the U.S. government’s decision to give up oversight of internet technical functions (IANA transition) were worried that the Internet Corporation for Assigned Names and Numbers (ICANN), which manages the global domain name system (DNS), would not be accountable to the global internet community, which includes new gTLD (new generic top-level domains) applicants.

Lack of predictability has been the main concern with ICANN’s new gTLDs' application process, Flip Petillion, a partner at Crowell & Moring LLP (domain: crowell.com)  in Brussels and co-chair of the firm's top-level domain and domain name practice, told Bloomberg BNA in the latest episode of the Code & Conduit podcast. Petillion said independent panels have rendered conflicting decisions over whether domains such as .car and .cars are confusingly similar.

“Although ICANN has reacted positively in response to certain individual complaints regarding inconsistent determinations on string confusion, it has failed to address the underlying reason for the inconsistencies in the determinations and it has refused to intervene in the majority of cases,” Petillion said.

Petillion discusses the steps ICANN has taken since the oversight transition to address these concerns and some of the remaining challenges.

Twitter: @Crowell_Moring

Petillion's book: Competing for the Internet: ICANN Gate - An Analysis and Plea for Judicial Review Through Arbitration

ISBN-13: 978-9041182524
ISBN-10: 9041182527
on Amazon.com


Podcast source: BNA.com and SoundCloud.com

 feedback & comments via twitter @DomainMondo
Follow @DomainMondo

DISCLAIMER

News Review: ICANN Wins Appeal on ccTLDs But Castigated in IRP Loss

"… the BGC [ICANN Board Governance Committee] admittedly did not examine whether the EIU or ICANN staff engaged in unjustified discrimination or failed to fulfill transparency obligations.  It failed to make any reasonable investigation or to make certain that it had acted with due diligence and care to be sure that it had a reasonable amount of facts before it.--Dot Registry IRP Declaration--see this week's FEATURES further below.

Domain Mondo's review and look ahead [pdf], starting with the macro view:

•  “The artist Christopher Wool has a word painting, 'Sell the house, sell the car, sell the kids.' That’s exactly how I feel – sell everything. Nothing here looks good ... The stock markets should be down massively but investors seem to have been hypnotized that nothing can go wrong."--Jeffrey Gundlach, CEO of DoubleLine Capital. See also: Goldman Turns Outright Bearish: Says To "Sell" Stocks Over Next 3 Months | ZeroHedge.com.

• China's Liquidity Trap: "For months now, those allied with the [China] central bank have warned that an ever-increasing reliance on looser liquidity is failing to juice the economy, arguing that monetary policy has reached its limits and abusing it would only cause consumer- and asset-price inflation ... China’s monetary policy ... [has] fallen into a “liquidity trap.” The term refers to an economic scenario where cash injections fail to reduce interest rates or generate more investments. Chinese companies were just hoarding the additional liquidity in the banking system instead of using it to expand investment ..."--WSJ.com

• Angela Merkel condemned: 'Germans have had enough' - thousands of people took to the streets of Berlin to protest against the German Chancellor’s open door policy - Polish experts claim 'Europe is dead' - Europe 'at the end of its existence' following a summer of terror and the EU’s free movement policy.  An ex-Polish counter-terror officer has warned 'the whole Balkans are flooded with weapons, and from the Balkans have come two million people. Together with them came arms dealers, gangsters, drug dealers. Buying a Kalashnikov in Bosnia and Herzegovina is as it was with us after the war. You can buy one for peanuts.' --DailyExpress.co.uk.

•  Rio 2016 Olympics not going to bump Brazil economy: "... Goldman Sachs' Alberto Ramos wrote in a note on Monday ... 'Furthermore, due to a number of large macroeconomic imbalances that have grown and permeated the economy and the severe drop in confidence indicators, total investment spending has actually been contracting uninterruptedly for 2.5 years. Gross Fixed Investment has now declined for ten consecutive quarters ... retrenched by a cumulative 27.0% between 4Q2013 and 1Q2016, and is now at the same level as 2Q2009.'"--BusinessInsider.com. See also: Carpet Cleaner Sues For Its Right to Tweet About the Olympics | gizmodo.com.

•  While easing interest rates to 0.25 percent (ECB is at -0-), Bank of England Governor Mark Carney said Britain could “handle” Brexit and insisted there was no danger of a recession. Referring to the outcome of the EU referendum, he spoke of the resilience of the British people and said the economy would continue to grow instead of stalling like much of the EU economy. The London Stock Exchange FTSE 100 ended the week UP 1% to close at 6,793.47 (see chart below). See Don’t blame Brexit for this rate cut. Blame Project Fear | telegraph.co.uk and Britain will succeed after Brexit insists Bank of England boss Mark Carney | Daily Express | express.co.uk. 

London Stock Exchange FTSE100 now UP 7% since Brexit vote

London Stock Exchange FTSE250 now UP 1% since Brexit vote

See also: Experts and the future | Matt Ridley | rationaloptimist.com: "The expert pollsters told the hedge funds Remain would win right up till when it lost, so the pound and the FTSE 100 rose, then crashed. The expert financial forecasters then told investors the FTSE 100 would fall further, but it quickly recovered all its lost ground and more. The expert analysts told us we should watch the FTSE 250 plunge instead, but that has now returned to the level it was at a week before the referendum (see chart above) ... there are no experts on the future. Explaining the present and the past requires expertise: “it’s your carburetor/prostate”. In forecasting the future, experts are generally no better than everybody else. They might be worse."

•  FEATURES: It was the best, and worst, week for ICANN

The Good: More than six months after oral arguments were heard, the Court of Appeals for the District of Columbia Circuit on August 2, 2016, issued its opinion affirming the U.S. District Court that the ccTLDs of Iran, Syria, and North Korea, were unattachable, thereby granting a victory to ICANN and the global internet community. Read more at US Court of Appeals Decision re: ICANN & Iran, Syria, North Korea ccTLDs. A post-decision discussion on the CCWG-Accountability (Weinstein v. ICANN) mail list, including ICANN Chairman Steve Crocker, Professor Milton Mueller and others, includes this from an attorney (from the U.S.):

"I have no real opinion on the case generally or the ccTLD/ICANN dispute.  But I think this is mistaken – of course if a registrar subject to an order chooses to resist the order and/or destroy the registry he can do that.  But subject to a lawful order, there is no reason to think that rebuilding the registry would be necessary – the court would simply order its transfer to the new registrar and an compliant loser would make the transfer ..."

Apparently, CCWG participant(s) do not know the difference between a registrar and registry operator!

The Bad: "... the [IRP] review panel findings cast heavy doubts on ICANN’s competence to manage without oversight."--ICANN can't: independent review finds group incompetent | TheStack.com. The Dot Registry IRP Declaration posted by ICANN on August 2, 2016, received critical commentary this past week, see ICANN IRP, Dot Registry New gTLDs INC LLC LLP, Tempest in a Teapot? The declaration (pdf) was a split decision (2-1), but included severe criticism of ICANN staff and the ICANN Board of Directors, including its Board Governance Committee (BGC).

While I have also been, and continue to be, a critic of the ill-advised and misbegotten new gTLDs program, both the policy and its implementation, as well as failures of ICANN leadership, in fairness, it should be noted the IRP (Independent Review Panel) declaration not only was a split decision, but the dissenting opinion stated, correctly I think, "The 'communities' proposed by Dot Registry ... do not demonstrate the characteristics of 'communities' under any definition" and therefore Dot Registry should not have passed the CPEs (Community Priority Evaluations) for .INC, .LLC, and .LLP.

And yet the continuing internal operational problems of ICANN (see also the .AFRICA IRP) are troubling. As I stated in my comment to ICANN, July 20, 2016 (pdf):

"September 30, 2016, is fast approaching, and ICANN management and staff, particularly at the “Global Domains Division” (GDD) seem ill-prepared--still engaging in unprofessional, incompetent, inept or opaque practices ... Hopefully the ICANN Board and new ICANN President & CEO, in the near future, will reorganize ICANN’s corporate operational structure, and staffing, abolish the GDD completely (a GDD President is one too many “Presidents” for ICANN), and move “Contract Compliance” into a separate division or department that includes consumer trust and protection, as well as domain name registrants’ remedies and advocacy, reporting directly to the ICANN President & CEO, and the ICANN Board." 

The problems within ICANN's legal staff and the ICANN Board of Directors, as noted in the IRP Declaration, may be at the root of ICANN's problems. ICANN has had a weak, mostly passive, Board of Directors, e.g., the Board willingly enabled the former CEO's dysfunctional leadership, which brought about mission creep, conflicts of interest, and all of the inappropriate actions and omissions detailed in the Dot Registry IRP Declaration. Other than replacing current Board members with better, more independent, experienced, and competent Directors, perhaps ICANN could as I suggested last year:

"ICANN has quite a history of conflicts of interest, lack of accountability and transparency, secrecy, rewarding insiders including ICANN officers even after resigning due to "conflicts of interest". None of this comes as a surprise since Chehade's tenure as ICANN CEO has the worst record on conflicts of interest, appearances of impropriety, and "cronyism" in the history of ICANN--see Domain Mondo's RPMs comment (pdf). Complicating all of this is the ICANN Board's apparent dysfunction and failures in competent corporate governance, including its inability to have "in place" and "enforce" an effective code of conduct for all ICANN officers and staff. The Board appears to be in a constant "reactive" mode trapped between stakeholders (mostly "lobbyists") and ICANN officers/staff. CCWG-Accountability should have concentrated on core competencies including the selection, orientation, training and continuing education of ICANN Board members, ICANN officers and staff, as well as stakeholders. Anyone involved in ICANN needs to have at least a rudimentary understanding of California non-profit corporate law, ethics in the public non-profit corporate sphere, applicable U.S. law, and the common law system. Jurisdiction matters. A good joint project for ICANN legal, Jones Day, and CCWG's independent legal counsel, post-transition, would be to develop and publish an orientation and training program accessible to all online, which should be required of all ICANN directors, officers, and staff, as well as anyone choosing to stand for election or appointment to the ICANN Board. Good corporate governance is hard work and not easy--witness the scandals at organizations as diverse as FIFA and the American Red Cross." (emphasis added)

I would now change the reference to "ICANN legal, Jones Day" above, to a new independent outside counsel to the ICANN Board of Directors solely for the purpose of advising and educating ICANN directors of their duties under California and other applicable law, and providing independent legal advice concerning issues that come before the Board. ICANN legal staff and Jones Day are conflicted, representing corporate management and staff, and the corporation, respectively. The IANA transition end date, September 30, is only weeks away, and the Dot Registry IRP Declaration makes it clear the ICANN Board, ICANN management and staff, are not ready.

• Comments close this coming week at ICANN on:

• PTI Governance Documents: Close Date 7 Aug 2016 23:59 UTC
• Draft PTI Bylaws: Close Date 11 Aug 2016 23:59 UTC
• Public Comment on Proposed Amendment to .COM Registry Agreement: Close Date 12 Aug 2016 23:59 UTC
• Modifications to GNSO Operating Procedures Relating to Motions and to the Chair and Vice-Chair Elections: Close Date 14 Aug 2016 23:59 UTC

•  ICANN Quarterly Stakeholder Report – Register for the FY16 Q4 Call on 18 August‬‬ | ICANN.org: The FY16 Q4 (ended June 30, 2016) Stakeholder Call, will take place on 18 August at 1500 UTC. The call will focus on how ICANN has implemented the community's policies for the quarter ending 30 June 2016. More info at the link above.

•  IANA Stewardship Transition Implementation Planning Update (Volume 4) - ICANN:

Implementation Timeline (source: ICANN 15 Jul 2016)

•  Request for Proposal Announcement - DNS Abuse Study - ICANN: "A number of safeguards were built into the [new gTLDs] Program that were intended to mitigate rates of abusive, malicious, and criminal activity in these new gTLDs, such as phishing, spam, malware distribution, and botnet command-and-control. ICANN is currently engaged in a review of these safeguards and their effects on rates of DNS abuse, and is seeking a provider to conduct a study examining rates of malicious and abusive behavior in the global DNS." Participant RFP proposals due by 25 August 2016 by 23:59 UTC. More info at link above.

•  Future Rounds of New gTLDs: Almost Free Domains for Almost Everyone | CircleID.com by John Levine: "My plan is simple: next time the application fee is nominal, say $1000. But if there are several applications for the same name, they all go to auction, and the auction income pays for the rest of the program ... This approach may seem cynical and venal. It is. But in practice is it any more so than the current approach? It may be cynical, but it's a lot simpler and a lot more transparent."

•  Why Registry Service Providers Should be Accredited by ICANN | CircleID.com: "... it is equally apparent that the downward spiral of Registry Service Provider pricing will lead to cut corners. The result will be a failure ..."

• Trend in Naming & Branding:  Band Names Without Vowels: Why Artists Are Ditching Those Letters | Billboard: "From brands that shorten their names or use letters that don't go together to make names more easily trademarked, Cashion said the trend has spread across the business world and into pop culture. "In the short term, the challenge I tell clients is that the name might be less intuitive from a pronunciation point and in the short term it might be harder to find, but in the long term the ownability of it is higher." There's actually a name for it -- disemvoweling -- and a few years ago Wired wrote an obituary for the letter "e," in light of how many technology companies had decided to drop the most frequently used letter in the English alphabet."

•  Other News:

• If you can't beat 'em ...:  Uber China, Didi to merge in $35B deal - Uber (Private:UBER) | SeekingAlpha.com and The Uber-Didi deal is straight out of Peter Thiel's playbook - Recode.net: "Americans mythologize competition and credit it with saving us from socialist bread lines. Actually, capitalism and competition are opposites. Capitalism is premised on the accumulation of capital, but under perfect competition, all profits get competed away. The lesson for entrepreneurs is clear: If you want to create and capture lasting value, don't build an undifferentiated commodity business."
• Apple Isn't Making It in India | Bloomberg.com: "... sales in India of iOS-enabled smartphones, meaning iPhones, fell 35 percent in the second quarter from a year earlier. What's worse, that decline left the U.S. company with just 2.4 percent of a market that grew 19 percent."  See also: Android Captures Record 97 Percent Smartphone Marketshare in India in Q2 2016 | strategyanalytics.com.
• China, Not Silicon Valley, Is Cutting Edge in Mobile Tech | NYTimes.com: "The U.S. often copies China,” said Ben Thompson, the founder of the tech research firm Stratechery. “For the Facebook Messenger app, for example, the best way to understand their road map is to look at WeChat” ... Facebook and smaller rivals like Kik are trying to replicate what has emerged in China: dominant online platforms where users will spend much of their time. Much of that effort is focused on chat. See also: China Online Retail Market To Reach Saturation Levels | ChinaInternetWatch.com: "81% of China population in tier-1 cities shop online ..."
• Amazon Prime airplane debuts after secret night flight | geekwire.com: "... The Boeing 767-300 jet is part of what will eventually become a fleet of 40 planes, transporting cargo between Amazon’s distribution centers for delivery to customers. Clark said the planes will mesh with Amazon’s network of 4,000 branded truck trailers, the Uber-like Amazon Flex delivery system ..."
• Donald Trump touts Twitter (NYSE: TWTR): Donald Trump said tweets are a far more effective means of information dissemination than press releases ... Lamenting that when he put out a "beautiful, long, perfectly scripted press release like I did [Sunday], nobody puts it out,” Trump said. “If I put out a 140-character tweet, they go crazy. 'We have breaking news!' They break into every story. So you gotta use it, you gotta use it.” --Politico.com

•  Q2 2016 Earnings Season ends this week on Domain Mondo with Rightside $NAME on August 9, and Alibaba $BABA which reports on August 11--Note: as now indicated on Domain Mondo's Stock Links page, beginning next quarter, Q3 2016, coverage of  quarterly earnings releases and webcasts of Yahoo $YHOO, Alibaba $BABA, and Web.com $WEB will no longer be provided by Domain Mondo.  Yahoo's core assets are being sold to Verizon, Alibaba is under scrutiny by the SEC and also subject to increasing control or manipulation by the government of China, while Web.com is in transition from domains to services with higher profit margins. This will leave 5 tech companies: Alphabet (Google); Amazon; Apple; Facebook; Twitter; and 4 domain name industry companies: GoDaddy; Neustar; Rightside; Verisign; on the quarterly earnings coverage list.

•  Five most popular posts (# of pageviews Sun-Sat) this week on DomainMondo.com:

1. News Review[Jul31]: Verisign's Big Win of gTLD WEB; ICANN Litigation Report
2. GoDaddy $GDDY Q2 2016 Financial Results & LIVE Webcast, Flare App
3. US Court of Appeals Decision re: ICANN & Iran, Syria, North Korea ccTLDs
4. Fintech: Financial Digital Disruption (infographic)
5. Web.com $WEB Earnings Release, LIVE Webcast, August 4, 5pm EDT

• 10 Other Reading Recommendations:

1. ICYMI: "... the European Banking Authority released the stress test results on Friday [July 29]. Deutsche Bank didn’t fail in part because there was no way to fail. No bank could fail, not even Italy’s Banca Monte dei Paschi di Siena which is in full collapse-and-bailout mode at this moment ... Tier 1 capital ratio after in the “adverse scenario” made it possible to rank the banks. At Deutsche Bank, that ratio dropped to 7.8%, making it the 10th riskiest bank among all European banks in the stress test. Commerzbank, the second largest German bank ... was the 8th riskiest bank, ahead of Societe Generale in 9th place and behind Barclays in 7th place. Then came Irish, Italian, and Spanish banks. In third place was the Austrian cooperative banking group Raiffeisen-Landesbanken. In second place, Allied Irish Banks. And of course, the winner, Monte dei Paschi ..."--WolfStreet.com
2. Donald Trump Warns Americans To Get Out Of The Stock Market As The Dow Falls For A 7th Day In A Row | washingtonsblog.com: "In Europe ... a “too big to fail” crisis is rapidly unfolding across the entire continent, but most Americans are totally oblivious to what is going on over there.  Instead, our major news outlets are feeding us an endless barrage of negative headlines about Donald Trump and a steady stream of positive headlines about Hillary Clinton. I wonder who they want to win the election? Of course I am being sarcastic.  The days when the mainstream media at least pretended to be “independent” are long gone."
3. Keep An Eye On: Google has sold 30 million Chromecasts, 5 million in the past 2 months | 9to5Google.com.
4. Dinosaur Watch: Another Retailer Leveraged Buyout Bites the Dust | WolfStreet.com. "... malls are getting hit as previously “pent-up” real-estate demand from retailers is expected to “fizzle.”... Mall Owners Begin to Feel the Pain of Brick & Mortar Retailers"
5. The Paradox of Quant | thereformedbroker.com: "Once crowded, there are a few choices for practitioners of a given investing discipline: pretend it’s not over; adapt and move on to the next thing; leverage up; sell out to a competitor."
6. Time to reevaluate blockchain hype: "Hong-Kong based Bitfinex exchange is short 119,756 bitcoins after being hacked on Tuesday, though nobody can be sure what’s really happened because ‘hacking’ is a loose term and can encapsulate almost anything, including an internal security breach ... mark-to-market value of the stolen coins is roughly $70m, but again who can really tell their true worth. Bitcoin is an asset class where the liquidation of 119,756 (approximately 0.8 per cent of total bitcoin circulation) can move the market more than 20 per cent, suggesting a certain fantastical element to the valuation."--FT.com
7. Geopolitical Watch I: EU ‘unsustainable in its current form’| EurActiv.com: S&P Global Ratings added its voice to the growing number of politicians and analysts calling for change. “... the EU, as it’s currently constructed and operates ... [is] unsustainable in its current form,” S&P said ... A clear response is needed to address uncertainty about the future of the EU and to make it relevant to citizens ..."
8. Geopolitical Watch II: For Post-Brexit British Vacationers, Staying Home Now Seems Appealing | NPR.org: "... Just off a beachfront carousel, Matthew Kirk's little boy squeals for ice cream. His dad says British resorts, some of which have seen better days, could rebound amid all this. Kirk says he's happy to help the local U.K. economy. "It'd be nice to see them making a living and thriving"..."
9. TCO - Total Cost of Ownership: How Much Do Car Maintenance Costs Increase with Mileage? | YourMechanic.com: "The average car costs $1,400 to maintain up to 25,000 miles, then costs rise rapidly until 100,000 miles. Toyota wins as the cheapest car to maintain."
10. Zika vaccine: NIH begins testing investigational Zika vaccine in humans | National Institutes of Health | NIH.gov and Zika vaccine gives complete protection and is ready for human trials, say scientists | telegraph.co.uk.

-- John Poole, Editor, Domain Mondo

feedback & comments via twitter @DomainMondo
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News Review: ICANN Bylaws, Comments, ICANN Chairman's Op-ed Flops

Domain Mondo's review of the past week and look ahead [pdf of this post here]:

The implentation phase of the IANA Stewardship Transition Plan (including WS1 of Enhancing ICANN Accountability) is proceeding in accord with the tentative timeline:

IANA Stewardship Transition Tentative Timeline

• ICANN's new proposed bylaws in connection with the IANA transition and ICANN accountability proposal, have been posted for public comment through May 21, 2016. Read more at: ICANN Posts Draft of New Bylaws For Public Comment Until May 21 | DomainMondo.com.

•  On April 19, the Wall Street Journal published an op-ed by ICANN Board Chairman Steve Crocker, warning of terrible consequences if the U.S. government (NTIA) does not end its oversight of the IANA functions:

Broadening the Oversight of a Free and Open Internet - WSJ: "... If the U.S. does not transition its stewardship role to the global Internet community, then other governments may try to move control to organizations like the United Nations. There is also a risk that some governments may form their own national or regional networks. This disruptive splintering would damage the economy and weaken personal Internet use ..." (emphasis added)

Crocker, like others involved in the IANA transition process from the beginning, including NTIA's Larry Strickling on March 14, 2014, is being disingenuous by using the phrase "global internet community" when he really means ICANN, the California corporation. The IANA stewardship transition is only about transitioning, or privatizing, the U.S. government's stewardship role from the U.S. to ICANN, not the global Internet community. The global Internet community is hardly the same as ICANN or even ICANN's "community," a fact acknowledged by ICANN and the "ICANN community" in setting up the ground rules for participation in the CCWG-Accountability (Cross Community Working Group to Enhance ICANN Accountability):

Members & Participants - Enhancing ICANN Accountability: "Anyone interested can volunteer to join the CCWG as a "participant," regardless of whether they are members of the ICANN community." (emphasis added)

Unlike the global Internet community, ICANN has largely been captured by domain name industry and other special interests. As far as Crocker's comment about "splintering" [or fragmentation] of the internet is concerned, that is already happening, due, in large part, to distrust of ICANN, its programs, policies, processes, structures, and leadership, by the global Internet community.

Crocker apparently forgot he was addressing readers of the Wall Street Journal, not a gathering of the UN's Internet Governance Forum or WSIS. His message would have been much better received had he simply been honest about the IANA transition, rather than using the false narrative of a transition to the "global Internet community." In fact, the Wall Street crowd would have probably warmly embraced the idea of a transition from 'U.S. government control' to 'control by ICANN,' a California corporation, which functions largely as a captured agency controlled by lobbyists and lawyers representing special interests, known as 'stakeholders' in the institutional jargon of ICANN, with the U.S. government retaining veto power over interference by foreign governments.

But Crocker followed the script he had been given, false narratives and institutional secrets are inculcated in ICANN's sick organizational culture. Besides being a misleading reference, the phrase "global Internet community" sounds to denizens of Wall Street like a rallying cry of the Trotskyite wing of #FeelTheBern. The Wall Street Journal readers' comments to Crocker's op-ed (more than 70 at last count), confirm this. While interesting and entertaining to read, particularly if one wants to know what that part of the global Internet community--the part that comprises the affluent demographic that subscribes to the Wall Street Journal--thinks about the IANA stewardship transition, there is a jarring brutal honesty in the comments for those accustomed to the rarefied air of the "ICANN bubble"--here are a few excerpts--

This is a typical political sales pitch; it tells us nothing about the features that supposedly will produce the claimed benefits, ignores legitimate concerns and glosses over all problem areas. Mr. Crocker missed his calling as a telemarketer ...

This is a totally misguided transformation. Mr. Crocker's last sentence to "assure that the Internet of tomorrow is as free, open and resilient as the Internet of today" should give us all pause about even contemplating the changes he and others propose. His proposal reminds me of a mentally ill patient, who, after using medication to restore his mental health, goes off his meds because "he is cured". As soon as the Commerce Department steps away, it will be open season on that openness and freedom by some of the darkest elements around the world, both corporate and governmental. The only reason the internet is free, open and resilient is that the US Government stands behind it. 

This article does not include a single supported assertion. Speaking on behalf of "the Internet community—along with businesses, civil society and other interest groups," I voice my dissent.

Mr. Crocker's column is a nice example of a buffoon using all the right words (diverse, accountable, community) to blow smoke up our 4th point of contact. When you want a technical activity managed properly, you don't care about diversity - that is for non-technical people looking to grab control of something. Then there are the questions Mr. Crocker doesn't answer: Example: accountable to whom? He never says specifically, just yada yada yada about an international community. Been there; done that. It's called the UN. Letting Russia, China or the UN anywhere near controlling anything about the internet guarantees only censorship. Even the Europe Union, with its silly "right to be forgotten" can't be trusted ... 

... I have to ask who elects people to the Board of ICANN? This guy [Crocker] is really an embarrassment, and should be removed forthwith ...

Not exactly the reaction and response Crocker was looking for, I'm sure. I'll leave the rest of the comments for your reading enjoyment. [Note: if you're like one member of the ICANN Board of Directors and don't know how to access WSJ articles without a subscription, just click the WSJ  story link on this Google search results page.]

• Draft ICANN FY17 Operating Plan & Budget and Five-Year Operating Plan Update: Open for Public Comments--Close Date 30 Apr 2016 23:59 UTC.

•  ICANN FY16 Q3 (Quarter ending 31 March 2016) Stakeholder Call - 27 April 1500 UTC:  Pre-register online here to join the Quarterly Stakeholder Call online. The call will take place 27 April at 1500 UTC time converter. Joining instructions will be sent to those who register in advance of the call. A recording will be made available after the call here: https://www.icann.org/resources/pages/quarterly-reports-2014-11-13-en.

• New gTLD? Use It OR Lose It: New gTLD Program Delegation Deadlines - ICANN: "... To date, registry agreements are in place for more than 1,230 new generic top-level domains (gTLDs), and more than 950 of these new gTLDs have been delegated into the root zone ...  The New gTLD Registry Agreement defines a 12-month period after contract execution during which the registry operator must delegate its TLD. ICANN expects registry operators to honor this commitment, and most do. However, we've recently seen an uptick in registry operators who either haven't met their deadline or aren't on track to do so. There are about 200 TLDs with approaching delegation deadlines between now and the end of August 2016 ... If a registry operator does not meet its delegation deadline, ICANN has the option to terminate the registry agreement, as per Section 4.3(b) of the agreement ..."

• DotConnectAfrica Trust vs ICANN and ZACR: ICANN's motion to dismiss scheduled for hearing April 25, in Los Angeles.

• Earnings Season schedule this week on Domain Mondo's Earnings Calendar:

• Twitter TWTR April 26
• Apple AAPL April 26
• Facebook FB April 27
• Verisign VRSN April 28, 4:30 p.m. ET
• Neustar NSR April 28
• Amazon AMZN April 28 5pm ET

• This past week's five most popular posts on Domain Mondo (# of pageviews Sun-Sat):

1. News Review [April 17, 2016]: dotAFRICA, Public Interest, Judge Holds ICANN Accountable
2. Alphabet $GOOG Q1 2016 Earnings, April 21 Webcast REPLAY
3. Yahoo $YHOO Q1 2016 Earnings Webcast, April 19, 5 pm ET (video)
4. ICANN, Esther Dyson, Becky Burr: The Historical Perspective
5. ICANN and the Global Public Interest, A Contradiction in Terms

Honorable mention: Jack Bogle, Founder of Vanguard Group, Creator of Index Funds, Interview | DomainMondo.com

New This Week: Other Reading Recommendations (with a little taste of the article or a little of my own commentary):

• Google’s Remarkably Close Relationship With the Obama White House, in Two Charts | The Intercept: "Google doesn't just lobby the White House for favors, but collaborates with officials, effectively serving as a sort of corporate extension of government operations in the digital era."
• Google site's traffic-acquisition costs (TAC) | Business Insider - Here's Google a/k/a Alphabet's real problem--mobile traffic is increasing, desktop traffic is in decline, Google is having to pay more to companies like Apple to position Google search as the default search application, meaning Google has to pay more and more to maintain its market position. It is having to pay more to buy traffic, and analysts fear this is a "race to the bottom." Meanwhile, Alphabet's own "alpha bets" are all losers, losing $$billions, and for how much longer, analysts and investors are beginning to wonder. See also: Google’s Skunkworks Loses Its Leader to Facebook—and Has Yet to Produce Any Hits | MIT Technology Review and At Google, pressure mounts to find something beyond search | CNET
• How Facebook plans to take over the world | Technology | The Guardian - Personally, I'm with India, 'no, thank you.'
• Why HTC may be the next Motorola of Android | Computerworld: "More than any other [Android smartphone] manufacturer, though, it's [HTC.com] doing a lot of things right -- and it's rapidly becoming the company to watch for anyone who cares about an exceptional Android experience."
• Apple Services Shut Down in China in Startling About-Face | The New York Times - a stark warning to any foreign entity doing business in China--here today, gone tomorrow.
• Buying an Android phone in India is a pain in the ass | Quartz: "... Er, iPhone? 'I hate Apple and their closed ecosystem. I’ll never buy Apple.'... Micromax, the maker of popular [Android] smartphones ... launched 15 phones on one day ... "
• Microsoft, Google agree to stop complaining to regulators about each other | Re/code - Proof of both Microsoft's and Google's mutual 'concerns' about other 'threats' 
• Financial Times: ‘We are facing daunting conditions’ | POLITICO: “... Despite its high-value readership, the financial newspaper has not been immune to the painful trends afflicting its general-interest rivals: Print advertising has had another bad start to the year, while the digital news business is also proving to be precarious ..."  - Are they just beginning to realize this?
• Why Intel’s Job Cuts May Be Just the Beginning | MIT Technology Review - Even a mighty disruptor is subject to disruption.
• Seeking Alpha: "... Intel, for instance, just announced that it would layoff 12,000 workers, 11% of its entire workforce. It is not the global economy that is blamed but rather the shift to mobile computing. At IBM, there is undeniable truth in the charge, but then how do we explain Apple, who should be the main beneficiary of Intel’s stumble (and IBM’s to some degree), suddenly and sharply cutting back its own production in January?... last week it was reported that Apple intended to maintain its reduced production schedule for the April to June period, as well, citing “sluggish sales”..."
• Now some good news: Acer Press Release | April 21: "Acer today debuts its new Chromebook 14 for Work, the industry’s first Chromebook with 6th Generation Intel® Core™ processors, available with a durable design designed to meet the demanding needs of enterprise, government, small business and institutional users. The Acer Chromebook 14 for Work is powered by a 6th Generation Intel Core processor to provide exceptional performance and long battery life of up to 12 hours ..." [Editor's Note: I have, and use daily, an Acer Chromebook and it is "fantastic" (however, I recommend only models with 4GB or 8GB RAM, 32GB SSD) --I will never go back to Windows (Windows 8, 10, Whatever)--according to data from Gartner, Acer Group (acer.com) is the world’s leading Chromebook brand with over 33 percent market share in Q4 2015. Here's a short YouTube video about the Acer Chromebook 14 for Work which goes on sale in the U.S. and EMEA through authorized Acer resellers in May, 2016.] Compare to Dell's Chromebook for Work.

Have a great week!

-- John Poole, Editor, Domain Mondo

Follow @DomainMondo

DISCLAIMER

News Review: ICANN, IANA Transition Plan, NTIA, and U.S. Congress

"... the U.S. Commerce Department’s National Telecommunications and Information Administration (NTIA) today announces its intent to transition key Internet domain name functions to the global multistakeholder community ..."-- NTIA, March 14, 2014

Domain Mondo's review of the past week--and a look ahead to the coming week--

ICANN55 in Marrakech concluded Thursday, March 10th, after the ICANN Board of Directors, a year behind schedule, finally transmitted to NTIA the IANA Stewardship Transition Plan developed in response to the NTIA announcement of March 2014. Read more on Domain Mondo here and here.

Don't believe the hype you may have read or heard from ICANN and NTIA, or their various sycophants. Not only are both touting false narratives in support of the Plan, but both are equally to blame for a flawed transition process which resulted in a plan that fails to address the fundamental, systemic, and structural problems of ICANN. Not only are Work Stream 1 accountability recommendations "untested, unproven, and yet to be implemented" but some fundamental issues were deferred such as ICANN's jurisdiction which will be addressed in work stream 2 (WS2). Will ICANN, a California corporation, be the first U.S. non-profit corporate inversion--not for tax benefits but for political expedience--reincorporating and relocating to Beijing or Geneva or Brussels in the future? No one knows. U.S. jurisdiction is not a fundamental bylaw. Jurisdiction could be changed to any other nation in the future, totalitarian or otherwise. Even the accountability of ICANN's AC/SOs (advisory committees and supporting organizations) to the wider global internet community was deferred to Work Stream 2, meaning these issues will be dealt with sometime in the future. When, if ever, domain name registrants and internet users, who are the core of the global multistakeholder community, might see real accountability from ICANN and its "ICANN community" is unknown, but don't hold your breath!

Remember, NTIA in its announcement of March 14, 2014, failed to even mention, much less require, improvements in ICANN's accountability to either the ICANN community or the global multistakeholder community (and there is a difference, although NTIA acts as if there isn't). It wasn't until ICANN's own "ICANN community" (mostly lobbyists and special interests) vociferously objected, that NTIA agreed and forced ICANN--the California corporation--to add ICANN's accountability to its own "ICANN community" as a necessary component of the IANA transition plan.

Also, not all Chartering organizations actually approved the CCWG Accountability proposal, and of those that did, many have members who expressed concerns or reservations--for example, note one slide shown at an ICANN55 ccNSO session--

One View of the Strengths & Weaknesses of the CCWG Accountability WS1 Proposal

Nevertheless, it is what it is. And the truth is, there isn't, at present, a better option B available other than to maintain the status quo which is unacceptable to most other governments in the world. Will the Plan be approved and current U.S. government oversight end on September 30, 2016? Short answer: Yes, unless Republicans insist on deferral until after a new administration takes office in January, 2017. We may know more this week after the U.S. House Energy and Commerce Committee's Communications and Technology Subcommittee holds its IANA transition hearing on March 17th. Stay tuned.

Of course, there is always the possibility that Congress--both Democrats and Republicans--realizes it is in the best interests of not only the American people, but also the global internet community, to insist upon the completion and implementation and subsequent evaluation of both Work Stream 1 (WS1) and Work Stream 2 (WS2) accountability mechanisms, and whether they are actually effective and working, and then decide whether ending U.S. oversight is appropriate and in the best interests of both the American people and the global internet community.

See also on Domain Mondo:

• How ICANN and ICANN CEO Fadi Chehadé Evade Accountability
• GAC Members [and other CCWG Members] Minority [Dissenting] Statements on ICANN Accountability WS1 Proposal

Most popular articles at DomainMondo.com this past week (# of pageviews Sun-Sat):

1. ICANN a Steward? LOL! This Is How ICANN Wastes Registrants' Money
2. Forty Tech Companies Have Come to Apple's Encryption Defense (videos)
3. News Review: ICANN55, IANA Transition, New gTLDs, dot AFRICA
4. ICANN55: IANA Transition Plan, Sexual Harrassment, ICANN New gTLDs
5. Could The CIA Have Stopped The 9/11 Hijackers? New Yorker New Media

Final Note: Don't miss Domain Mondo's post yesterday: Consumer Trust In New gTLD Domains Is Getting Worse says NCC Group - more Bad News for ICANN's new gTLDs

Have a great week!

-- John Poole, Editor, Domain Mondo


Follow @DomainMondo

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