Suppose that back in 1997 the US Department of Commerce,
via its National Telecommunications and Administration
Administration (NTIA) had not adopted, without any demonstrable source
of legal
authority, that hangnail from the Reagan-Thatcher
school of government - the idea that governmental powers are best
exercised by private actors without the nuisances of public
constraint and public oversight.
There is a branch of fiction known as "Alternative History".
These are stories of what might have been. What might have
been had
the British intervened on the side of the South in 1863? What might
have happened had Khrushchev not backed down in Cuba in 1963? What
might have happened had the Supreme Court not stepped into (onto?)
the Florida presidential vote count in 2000?
In that vein I am about to engage in a bit of alternative
history.
I am going to speculate about how the last ten years of
internet
history might have been had the US government, rather than
deciding to renew the Network Solutions contract, had, instead,
opted to drop its marionette strings and allow the forces of
competition, innovation, and consumer choice to operate as we
expect them to operate in an open, unregulated, competitive
economy. In other words, what if the US government had not
created
ICANN?
Being an untrained and clumsy writer, I'm going to be blunt
about foreshadowing the tale: Without an ICANN we would today have
greater innovation in the internet name space. Domain name
prices
would be lower, consumer choice would be greater, and the internet
would have greater resilience to failures than it has today.
The road we did not take would have been the better choice.
Is the dead hand of the past so strong that we are forced to
live forever with that mistaken choice and never seek
correction?
Shakespeare wrote, "[w]hereof what's past is prologue, what to
come in yours and my discharge." Is the future really in our hands?
Can we treat the choices of 1997 as mere prologue to a story not
yet written?
Before starting, let us detour a bit and review the events
that
led to the ICANN of today.
There were two intertwined stories:
First was the story of the Cooperative Agreement with Network
Solutions (a company that was subsequently acquired by Verisign and
then, shrunk to a mere registrar, and sold off, with Verisign
retaining the registry role.)
Second was the story of Jon Postel's test of the internet's
domain name system.
Let's look at these stories:
The Story Of The Cooperative Agreement
The increasingly lucrative cooperative agreement under which
Network Solutions (Verisign) was managing .com, .net, .org, and
.edu was scheduled to expire in 1998. Under that agreement
Network
Solutions was obligated to deliver back to NTIA the tools and data
necessary to transfer operations to another contractor or to the
public.
In 1997 the US government agencies became concerned - some
might
say they began to panic. They felt compelled to chose between
three
ill alternatives:
- Extending the Network Solutions contract.
- Replacing Network Solutions as a contractor much as the US
National Park Service occasionally replaces the concessionaires it
uses to run the government owned hotels at the Grand Canyon,
Yellowstone, and Yosemite national parks.
- Relinquishing the government's role over the internet's
domain
name, IP address, and protocol parameters assignment systems.
The government felt that the second of these three choices -
replacement of Network Solutions with another contractor - would
require a formal procurement process that could take several years.
Consequently this option was never seriously considered. One
could
wonder why the government did not consider combining the first and
second options - one term of extension in order to give time to
engage in a formal procurement. Whatever the answer, the fact
is
that replacement of Network Solutions was never seriously
pursued.
This left two options - extend or relinquish.
The government people chose what they believed was the lesser
of
two evils - they chose to extend the Network Solutions contract.
This choice was not unreasonable - the people who made the choice
are well-intentioned, smart, and informed; but the option to relinquish
would have
required that they convince many less informed people in the
executive and legislative branches of the US government that the
nascent internet would be better left to private enterprise and
choice. It seems that even those who hew to a "small
government is
a better government" point of view have a hard time letting go of
government control over the internet. And few civil servants
would
risk being branded as "the man who lost the internet".
So, rather than ending the Cooperative Agreement, a product of
a
much different internet era, NTIA decided to give it a face-lift.
In fact, the agreement has had its face lifted nearly a dozen
times. The
resulting miracle of bureaucratic plastic surgery remains in force
to this day, a lifespan increase of over 300% so far and with no
clear sign that it will ever end. This extension represents a
government backed gift to Network Solutions, and its successor,
Verisign, that by some estimates amounts to an income stream of
nearly half a billion dollars every year.
The Story of John Postel's Test
In early 1998 Jon Postel decided to do a very good thing.
Postel wanted to validate that the DNS was as robust as it
was purported
to be. Postel decided to run a limited test in the IP address
from
which root servers obtain their "zone files" would be
altered. This
was not a particularly radical test and, should things have gone
awry, backing out would be both fast and easy. Also remember,
this
was in years before internet had obtained massive public
visibility. What Postel did was quite in keeping with the
pragmatic
approach from which the internet grew - an approach in which
one tests, learns, and improves. Nonetheless, the government
went
ballistic. Postel was threatened with severe legal, even
criminal,
sanctions. Postel, an employee of USC-ISI asked his employer
for
help; USC-ISI refused. Postel felt what anyone would feel -
alone
and afraid.
So Jon Postel, a California resident, asked for
help. An
attorney from Washington DC showed up on his doorstep; an attorney
who does not seem to be able to demonstrate having a license to
practice law in California. But despite that apparent lack,
Postel
accepted this attorney.
This attorney was from the Washington DC office of the
Cleveland
Ohio firm of Jones Day.
The Stories Intertwine
In 1997 NTIA began to emit strong pheromones that it wanted
the
law firm of Jones Day to create a nominally private corporation to
assume the powers that NTIA was exercising, albeit without any
apparent source of legal authority for the exercise of those
powers. In other words, NTIA, an agency of the Executive
Branch,
wanted to induce the creation of a private body to do things that
NTIA wanted done but for which NTIA did not have the legal
authority to do itself. (The reader would not be alone if
this
suggests that NTIA uses ICANN in much the same way that the US
State Department uses Blackwater.)
Jones Day responded (much to the benefit of its balance sheet:
Jones Day's response has turned into a revenue stream that floods
ever larger with every passing year. As ICANN's largest
creditor,
Jones Day yearly reaps millions of dollars in legal fees from the
corporation that Jones Day created to serve NTIA.)
Postel's attorney from Jones Day started circulating drafts of
a
plan to form a body to be called ICANN. Each successive draft
seemed to be the result of yet another hidden agreement with yet
another round of unknown parties. Midway through this
sequence, Jon
Postel died. But his attorney survived. And further
iterations
appeared (as presumably more secret back room promises were
made.)
NTIA, in an effort to appear open to other plans did allow
other
plans to be submitted; but it was pretty clear from various
inchoate emanations that none of these had any hope and would have
no weight except, perhaps, to slightly nudge the Jones Day plan.
One of the most influential of these other plans was that of the
Boston Working Group, a group with which I am affiliated. Our
proposal is still visible on the net at
http://www.cavebear.com/bwg/
As expected, the Jones Day plan won
NTIA's nod of approval.
The fruit of this NTIA-Jones Day cultivation was a strange
creation: ICANN, a thing neither fish nor fowl, not clearly
private
yet not clearly governmental, and like Prospero's Ariel able to
operate beyond the normal constraints that restrain governmental
agencies and the laws and economic forces that channel and limit
private action.
A small number of incumbent interests find ICANN to be highly
satisfactory
and lucrative. However, most of us end up with something
rather
less pleasant: Anyone buying a domain name now pays a private
internet tax to ICANN and domain name prices are massively inflated
(by perhaps 35,000%) with regard to the actual costs. Others
find
ICANN as a body that restrains trade by denying their completely
legal enterprises entre into the domain name marketplace or by
subjecting their businesses processes to a small mountain of
contractual gobbledygook.
NTIA and ICANN have effectively allowed the .com and .net top
level domains to become the private property of Verisign. It
is not
often that a caretaker, like Network Solutions, is allowed to
reward itself with ownership of the estate. By way of analogy
it is
as if the company that was hired to run the hotel at the Grand
Canyon has been allowed to become owner of the hotel and the Grand
Canyon. This is a rather bizarre twist, yet that is what has
happened.
The cost to the community of internet users is enormous -
Every
year more than half a billion dollars is paid by internet users in
the form of inflated and arbitrary domain name fees. And if
that
were not bad enough, internet innovation and imagination have been
smothered on the altar of registry profits and trademark
protectionism.
So much for the real history.
The Alternative History
Let us turn back the calendar to 1997. Let us posit
that NTIA
has decided to let the cooperative agreement expire and has
required Network Solutions (Verisign) to return the materials and
data that it is obligated to return under the terms of that
agreement.
And let us posit that NTIA has decided not to merely replace
one
face with another and instead has decided to open the door to
enterprise and innovation by providing that name registration data
to any and all comers.
And let us suppose that when Jon Postel ran his very sensible
test that the US government did not cluck itself into a Chicken
Little frenzy and demand that the net must be wrapped with a
Procrustean regulatory system.
At this point perhaps you are hearing a voice in your head
suggesting, or perhaps screaming, "there would have been chaos",
this is an unbelievable alternative history.
Is it really unbelievable? It certainly was
possible. What is
chaos to one is often opportunity to another. Is it not one
of the
foundation stones of our social system that individual choice is to
be preferred to both monopoly markets and government
regulation?
What is unbelievable to this writer is that the US Government
leapt to the conclusion that heavy regulation of the net was
required without ever really considering how the net might be
nudged, rather than bludgeoned, towards greater commercial
stability.
J. D. Rockefeller, one of the greatest
monopolists of all time,
justified his destruction of his competitors, his imposition of
rigid controls over the petroleum refining and transport
industries, and his nearly imperial control of distribution
channels and products on the grounds that he was merely
"rationalizing" and "standardizing" the oil business.
Those who argue in favor of ICANN often use Rockefeller's
argument - they justify ICANN's rigid regulation as a way to
rationalize the marketplace of internet names so that the
incumbents in that marketplace can be spared the discomfort of
competition and the buyers of domain names relieved of the burden
of having to make a choice between different offerings.
Do we want to "rationalize" the internet in same way that
Rockefeller "rationalized" the petroleum refining industry of the
1870's?
I think not.
But I digress; let us return to our story:
Suppose that in 1997 NTIA decides it will allow the
cooperative
agreement to lapse at the end of 1998 and that six months prior to
the expiration, and again at the time of expiration, NTIA will make
a copy of the operational data available without charge or
encumbrance. NTIA decides that 1998 would be a year of
transition.
NTIA's decision does not eliminate Network Solutions; it
merely
removes Network Solution's monopoly. If Network Solutions
chose to
do so, it could continue its operations. But it would no
longer be
alone or given any preference or special privilege.
In other words, NTIA decides that at the end of 1998, at the
end
of the agreement, anybody who wants to run .com, .net, .edu, and
.org would be free do so, using his/her own capital, using his/her
own business plan, and at his/her own risk.
Remember the movie Spartacus? The rebelling slave army is
captured and the Roman general asks "Who among you is Spartacus?"
One by one every slave stands up and says "I am Spartacus".
In our tale the ending of the cooperative agreement would
cause
a similar scene: New vendors, and Network Solutions - everyone -
would have stood up and said "I am .com", "I am .org", "I am
.net".
None would be and all would be. There would be no
legal ground
to distinguish among the claimants. The would have to compete
among
themselves. Network Solutions would, however, been the
Goliath.
How precisely this competition would have resolved itself none
can say. But we can say with certainty that it would have
quickly
resolved itself as it always does when there is a lot of money on
the table.
I suppose that those of you who are still with me will be
reminded of
the
cartoon in which some scientists have filled a blackboard
with equations. And in the middle of the board is a cloud
with the
words "Then a miracle occurs".
Am I suggesting that NTIA should have bet the internet of 1997
on a miracle? Yes, I am.
But it is no less betting on a miracle than we do every day
when
we allow electricity, food, fuel, and many other aspects of our
normal lives to be handled by the miracle of private innovation and
competition within the limits set by law.
Would there have been an uncomfortable bump? Yes, there
probably
would have been a period during 1997 when internet users wanting to
acquire domain names would not know clearly from whom to buy them.
Network Solutions, the former incumbent, would with almost
certainty obtain the lions' share of the business, not unlike the
way that the Baby Bells inherited most of the former Ma Bell
(AT&T) customers when AT&T was split apart.
What forms might have coalesced out of this temporary period
of
fog and uncertainty?
Competing root systems? Cooperative, truly non-profit,
registries? Co-op registries that operate by N of M consensus
systems?
All of these, probably. Not all would have
survived. Some would
have failed.
Some internet users would have had an experience similar to
that
of people who bought tickets on low fare airlines and charters
during the 1970: the carrier failed and they got stuck with a
worthless ticket and a claim in bankruptcy court on the remaining
assets of the bankrupt carrier.
In our alternative history some internet users will find that
they have acquired domain names that do not resolve. There
will be
lawsuits for fraud. Domain name providers who are smart will
quickly change their practices and contracts so that every domain
name buyer is made fully aware of the risks in much the same what
that buyers of securities in the US are provided with enough
information to make informed choices, should they chose to do
so.
January 1, 1999 would have dawned on a more stable
situation:
Network Solutions would be the dominant provider of domain
names
with a firm grip on the .com, .net, .org, and .edu top level
domains. Network Solutions would have simply bought out the
competition.
The suite of root server operators would
still
have been unaffected, no one would have yet seen the Google-like
opportunity that root and TLD servers provide.
However, and remember that this was during the height of the
.com bubble, money was available for just about anything. And
a lot
of people would have thought that having their own top level
domains would be profitable. (Even outside of our alternative
history, we can see from ICANN's actual year 2000 new-TLD process
that there was, in fact, a quite substantial interest in new
TLDs.)
These new TLDs would have soon discovered that they would not
even appear on the horizon of internet users until their TLDs were
incorporated into the root zone published by Network Solutions -
and Network Solutions would, understandably, not be quite willing
to give that kind of aide and comfort to their would-be
competitors.
By mid 1999 those who aspired to create new TLDs would have
recognized that Network Solutions was not going to allow them a
place in the sun and that the operators of the legacy root servers
weren't particularly interested in making changes.
So by September 1999 we would have seen the deployment of the
first competing root system run with as much capacity and
competence as the legacy roots. However, given the venture
funding
behind the new TLDs, these new root operators would have had access
capital for expansion and would have been created with the attitude
to aggressively reach for opportunities.
One of those opportunities would be what we today know as the
Google Model - selling marketing and advertising opportunities
while creating a positive feedback loop to increase those
opportunities by giving users a share of the proceeds.
In year 2000 the You-Root corporation, a privately owned,
for-profit, root
consortium, comes into operation in competition with the legacy
root.
You-Root has a multi-faceted business plan:
- You-Root mines the DNS queries that arrive at its servers
to
generate a real-time feed of usage data that it sells to market
research firms, corporate marketing groups, and national
intelligence agencies.
- It drives traffic to its DNS servers by paying ISP's to aim
their DNS resolvers at You-Root. ISP's receive a monthly
check from
You-Root that is based on the number of queries that the ISP sends
to You-Root. (You-Root finds, however, that it must quickly
design
mechanisms to detect synthetic traffic that is sent for no reason
except to drive up the query counts.)
- You-Root sells space in its root zone file to aspiring
TLDs,
much as brick-and-mortar stores sell high visibility (such as
end-of-aisle) shelf space.
- You-Root includes all of the TLDs, along with the
information
to their name servers, into its root zone file so that users who
are switched from the legacy root are not surprised with name
resolution failures.
- You-Root uses "anycast" routing to
deploy name servers where the traffic concentration warrents (or
where customers are willing to pay for a local root server.)
You-Root also maintains a high degree of internet connectivity so
that its servers are perceived as highly responsive.
- You-Root will, for a fee, elevate a TLD's zone data so that
it
is serviced by one of You-Root's own root servers and thus save a
DNS query round trip time, thus making web pages under that TLD
appear more responsive. You-Root allows these TLDs to offer a
pass
through service in which the TLD's name registrants can also have their
zone
data elevated into You-Root's servers, thus saving even more DNS
query round trip times and making those registrants' web sites
appear even more responsive.
You-Root gains market share as several ISP's, attracted to the
idea of payments for sending DNS queries to You-Root, re-aim their
servers. And large websites seeking to improve user
perceptions of
performance push to have their DNS zone data elevated into
You-Root's servers.
You-Root cuts a deal with Microsoft in which, for exchange for
real-time data for use in MSN, Microsoft will ship Windows with
You-Root as the default root server group rather than the legacy
root servers. A similar deal is made with Apple. In
neither deal is
it disclosed to the public in which direction any money payments
were made.
Now other aspiring root operators want to get into the game.
They follow You-Root's business model.
Soon the relationship between root server operators and TLDs
begins to shift - those TLDs that are more successful at gaining
registrants find that they become "must haves" and that they can
get root server operators to pay them for inclusion rather than
vice versa.
And all the while the Network Solutions/NTIA root zone becomes
less and less popular because it has become like a cable TV system
that only carries the ABC, CBS, and NBC television networks and
does not carry new content like CNN, Comedy Central, or HBO.
By the latter part of 2001 several root systems are in full
fledged competition, each trying to be carry more TLDs than its
counterparts. The result of this competition being that every
root
system carries all available TLDs except those few that are
stigmatized, as for example might happen if there is a trademark
dispute over who has the right to use a given name as a TLD.
As the pornography industry expands communities of users
realize
that one way they can protect themselves is by asking root
providers to offer tailored views of the DNS name space.
You-Root
and others begin to offer "family friendly" collections of TLD -
they will, for example, include the .Disney top level domain but
not .Sleeze.
Root providers will also offer TLD packages tailored for
various
religious, political, and social groups who, for whatever reason,
want to build walls between themselves and those who are not part
of their communities.
Some TLD operators will amplify this customer push for
differentiation by by using contracts with their registrants as a
means include or exclude certain types of content on websites found
under their TLDs.
TLD operators begin to start looking for more ways to
differentiate their offerings:
- Some start offering name registrations
for short periods for use with one time events.
- Some sell names for very long periods for those who want to
latch onto an internet name for as long as the TLD remains.
- Some will sell via resellers (registrars), some will sell
direct.
- Some will give names away in order to increase the traffic
they
get and thus increase the value of the marketing data that they can
derive. (Most of these go the way of the Cue Cat and
disappear.)
- Some start selling names using digital certificates to
represent ownership, thus providing a means for both permanent and
anonymous registrations. Revenue will be obtained by charging
for
specific services (such as updating name server records) rather
than yearly domain name rent. This will induce the creation
of
independent exchanges in which domain names can be bought and sold,
often anonymously.
Eventually root zone files will begin to bulge as every large
corporation decides that it wants its name to be a TLD. This
will
present technical challenges to root server operators to
disseminate updates to root zone files. (However, as we know
from
real-life .com, this is a problem that is manageable, at least up
to the present size of .com - over 70,000,000 names as of the date
of this writing, January 2008.)
Competition among TLDs and root providers drives prices down
and
down and down.
By 2007 typical price to a consumer for a domain name falls to
less than $0.25 per year, reflecting the actual mass scale of
economies that obtain in DNS, particularly when there is no
regulatory body imposing fiat registry rates an imposing its own
tithe on name transactions in order to fund itself.
DNS resiliency is improved: In 1997 DNS was a single point of
failure and attack for the internet. By 2007 there is a
multiplicity of competing roots that provide deep redundancy
against failure from natural or human causes.
DNS responsivity is improved - TLD operators recognizing that
DNS query/response time is a significant component of the user
perception of web site responsivity begin to push data and servers
closer to users.
New TLDs are no longer an issue - those who want to deploy a
new
TLD can do so. But as with nearly every other kind of product
offering, those who do this will have to expend time and effort to
build their TLD visibility and do so with their own money (or that
of their venture backers) at risk. Consumers of domain names
will
grow more aware of the risks of buying a name in these new
TLDs.
Some TLDs will never grow beyond boutique offerings that are
found in only a few root zones. Most of these will
fade. Others
will grow so that they become visible in nearly all root zones.
In the end we will have a marketplace that allows new TLDs to
be
born, to grow, to spread, and to die without any central regulatory
apparatus.
It will be a marketplace much like that found in the world of
cable TV, in which TLDs are similar to new TV channels. In
the
cable TV industry new channels must find a way to be included in
the offerings of the cable and satellite providers. In some
cases
these new channels will obtain visibility and become viable, in
other cases they will never obtain adequate acceptance and will
either disappear or be merged into another. In the DNS
industry,
new TLDs must find a way to be included in the offerings of root
providers else they will not gain sufficient visibility and use to
survive.
And so ends our alternative history - a history in which we
reach a stable, reliable DNS, both technically and economically,
but without the heavy hand and cost of regulation.
Is this alternative now impossible or could we turn away from
the regulatory system that has been imposed onto the internet by
the US Department of Commerce via ICANN?
There are many people who think that DNS must be regulated and
ossified into a single "authoritative" root.
There were many people who once thought the same thing about
the
voice telephone network. History proved them wrong.
And to finish on a final note that is neither hypothetical nor
an alternative history:
One of the things that neither ICANN, nor governments, nor
many
users are not realizing is that someday enough people might wake
up, question the dogma of the single "authoritative" catholic root.
They, just like Dorothy in the Wizard of Oz, already have the power
to overturn the status quo. Users of the net can simply, and
without the
need to ask permission from anyone or coordination with anyone,
turn the technical knobs on their DNS software and make the entire
legal, regulatory, and governance edifice fall to the ground -
while the net keeps on running without missing a beat.
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