Politech mailing list archives
FC: ICANN CEO proposes radical changes, more government involvement
From: Declan McCullagh <declan () well com>
Date: Mon, 25 Feb 2002 03:01:04 -0500
This is a complicated proposal and will take the community a while to digest. But some portions stand out, like having one-third of the 15 board members selected by national governments. So much for ICANN's veneer of independence. Threads from icannwatch: http://www.icannwatch.org/article.php?sid=563&mode=thread&order=0 http://www.icannwatch.org/article.php?sid=564&mode=thread&order=0 -Declan -- http://www.icann.org/announcements/announcement-24feb02.htm 24 February 2002 ______________________________________________________________________ ICANN President Recommends a Roadmap for Reform Marina del Rey, California USA (24 February 2002) At the ICANN Board of Directors retreat held over the weekend of 23 February, President Stuart Lynn proposed a sweeping series of structural reforms for ICANN. These reforms, designed to lead ICANN towards attainment of its core mission, were carefully discussed by the Board. Board directors encouraged Lynn to post the proposed reforms for public review and comment. "The current structure of ICANN was widely recognized as an experiment when created three years ago," noted Board Chairman Vint Cerf. "The rapid expansion of and increasing global dependence on the Internet have made it clear that a new structure is essential if ICANN is to fulfill its mission." ICANN was formed three years ago as an entirely private global organization designed to assume responsibility for the DNS root from the United States government and to coordinate technical policy for the Internet's naming and address allocation systems. In the new proposals, the basic mission remains intact. What changes is the means of achieving that mission. "What has become clear to me and others is that a purely private organization will not work," said Lynn. "The Internet has become too important to national economic and social progress. Governments, as the representatives of their populations, must participate more directly in ICANN's debates and policymaking functions. We must find the right form of global public-private partnership - one that combines the agility and strength of a private organization with the authority of governments to represent the public interest." Noting that current organizational inertia and obsession with process over substance has impeded agility, Lynn laid out a roadmap designed to instill confidence in key stakeholders and to ensure that ICANN can be more effective. This roadmap entails restructuring the Board of Directors into a Board of Trustees composed in part of trustees nominated by those governments who participate in the ICANN process; in part by the chairs of proposed new "policy councils" that would replace the existing supporting organizations and that would provide expert advice; and in part by trustees proposed by a broadly-based nominating committee and appointed by the Board itself. The roadmap is designed to bring all critical stakeholders to the table, something that has been difficult to achieve with the present structure and has slowed ICANN's progress and its ability to fulfill its responsibilities. It is also designed to establish a broad-based funding mechanism sufficient to support the critical mission of ICANN. "We need to build a stronger organization, supported by our key stakeholders, led by the best team that can be assembled, and properly funded," Lynn told the Board at its retreat. "We must be structured to function effectively in this fast-paced global Internet environment" "A key requirement is to keep the best of the present ICANN," added Cerf, "in ensuring transparency, openness, and participation, while creating an ICANN that can act responsibly and quickly. That will mean rejecting practices that have emphasized process over achievement. Above all, ICANN must be - and be seen to be - effective and supportive of technical innovation and of a reliable Internet." A paper written by Lynn that explains the reasons for change and the roadmap for reform is posted on the ICANN web site. --- http://www.icann.org/general/lynn-reform-proposal-24feb02.htm President's Report: ICANN - The Case for Reform 24 February 2002 ______________________________________________________________________ To the Internet Community: I have now been President of ICANN for just about a year. During that time, I have talked to more people than I can count about ICANN, its accomplishments and its deficiencies, and its future. I have also had the obligation to oversee the actual day-to-day operations of ICANN, and to make the hard decisions about what to do and how to do it in an environment of an incomplete structure and inadequate funding. I now feel comfortable enough with my state of knowledge that I want to share my views with the Board and the community. Attached to this note is a copy of the report I presented to the ICANN Board of Directors at its retreat in Washington, D.C. on February 23-24, 2002. ICANN's assigned mission - to create an effective private sector policy development process capable of administrative and policy management of the Internet's naming and address allocation systems - was incredibly ambitious. Nothing like this had ever been done before. ICANN was to serve as an alternative to the traditional, pre-Internet model of a multinational governmental treaty organization. The hope was that a private-sector body would be like the Internet itself: more efficient - more nimble - more able to react promptly to a rapidly changing environment and, at the same time, more open to meaningful participation by more stakeholders, developing policies through bottom-up consensus. It was also expected that such an entity could be established, and become functional, faster than a multinational governmental body. It is now more than three years since the creation of ICANN, and there are some real accomplishments: the introduction of a competitive registrar market, the Uniform Dispute Resolution Policy, the creation of seven new global Top Level Domains. But despite this progress, all the original expectations of ICANN have not been realized. ICANN is still not fully organized, and it is certainly not yet capable of shouldering the entire responsibility of global DNS management and coordination. ICANN has also not shown that it can be effective, nimble, and quick to react to problems. ICANN is overburdened with process, and at the same time underfunded and understaffed. For these and other more fundamental reasons, ICANN in its current form has not become the effective steward of the global Internet's naming and address allocation systems as conceived by its founders. Perhaps even more importantly, the passage of time has not increased the confidence that it can meet its original expectations and hopes. I have come to the conclusion that the original concept of a purely private sector body, based on consensus and consent, has been shown to be impractical. The fact that many of those critical to global coordination are still not willing to participate fully and effectively in the ICANN process is strong evidence of this fact. But I also am convinced that, for a resource as changeable and dynamic as the Internet, a traditional governmental approach as an alternative to ICANN remains a bad idea. The Internet needs effective, lightweight, and sensible global coordination in a few limited areas, allowing ample room for the innovation and change that makes this unique resource so useful and valuable. ICANN Needs Significant Structural Reform I have concluded that ICANN needs reform: deep, meaningful, structural reform, based on a clearheaded understanding of the successes and failures of the last three years. If ICANN is to succeed, this reform must replace ICANN's unstable institutional foundations with an effective public-private partnership, rooted in the private sector but with the active backing and participation of national governments. In short, ICANN is at a crossroads. The process of relocating functions from the US Government to ICANN is stalled. For a variety of reasons described in this document, I believe that ICANN's ability to make further progress is blocked by its structural weaknesses. To put it bluntly: On its present course, ICANN cannot accomplish its assigned mission. A new path - a new and reformed structure - is required. It is reasonable in this context to wonder whether we would be better off replacing ICANN with something entirely different. I do not believe that there are any better alternatives than a reformed ICANN. If the ICANN experiment of private-sector self-management cannot work, the default alternative will certainly be some form of multinational governmental organization. In my view, this remains an unattractive option, for all the same reasons that were so forcefully advanced three years ago. The United Nations, the World Trade Organization, and the International Telecommunications Union are all complex and sometimes effective organizations within their respective realms; however, each model has deep and evident shortcomings which in the Internet environment would render it a worse alternative than a reformed ICANN. A Reformed ICANN Can Be Successful Based on the experience of the last three years and my own focus on ICANN over the last year, I am convinced that a reformed ICANN can be successful - if we re-focus on our core mission, reform our institutional foundations to fit that mission, and eliminate the distractions of peripheral issues and agendas. To be clear: ICANN's mission is effective management and coordination of those few, higher-level elements of the Internet's naming and address allocation systems that require or benefit from global management and coordination, while abstaining from actions that might interfere with the creativity and innovation that has made the Internet such a dynamic resource. ICANN's mission is stewardship and operational stability, not the defense of its existence or the preservation of the status quo. Having said that, it is essential to state unambiguously what falls outside of ICANN's scope. The core ICANN mission includes no mandate to innovate new institutions of global democracy, nor to achieve mathematically equal representation of all affected individuals and organizations, nor to regulated content, nor to solve the problems of the digital divide, nor to embody some idealized (and never-before-realized) model of process or procedure. However important those ideals may be, they are for other, better-suited organizations to address. Unfortunately, we have allowed the advocates for these and other non-core objectives to divert ICANN from what must be its tight focus on its core mission. These diversions have been and will continue to be a significant impediment to accomplishing ICANN's core mission, unless we undertake a powerful reform of ICANN's structure and operations, and a committed refocus on its limited but important mission. Core Values Should Be Preserved Central to the ICANN experiment - and integral to its successes thus far - have been core values of openness and broad participation. I believe strongly in those values, and aim to strengthen them in a reformed ICANN. ICANN can and should do much better in achieving transparency, enabling meaningful participation, and reaching out to involve the global diversity of the Internet. A New Public-Private Partnership Is Necessary I am now convinced that the original desire to avoid a totally governmental takeover of the IANA functions led to an overreaction - the choice of a totally private model. With three years' experience, it is clear that model is simply not workable. It is not workable because it leaves ICANN isolated from the real-world institutions - governments - whose backing and support are essential for any effective global coordinating body to accomplish its assigned tasks. ICANN currently has an advisory committee to channel governmental input, but that mechanism has not effectively integrated the views or the influence of governments; we must find a better way. Though many in the traditional Internet community react strongly against the very mention of governments, it is simply unrealistic to believe that global coordination of the DNS can succeed without more active involvement of governments. Indeed, it has been for decades a bedrock principle of the Internet that technical managers should stick to what they know and do best, and leave to other organizations what they in turn do best. Governments play a unique role in representing the broad public interests of their populations. So far, ICANN's existing structures have not engaged the attention, commitment, and support of governments to the necessary degree. What is needed at this stage if ICANN is to carry out its mission is neither a totally private nor a totally governmental solution, but rather a well-balanced public-private partnership. Stable functioning of the Internet's naming and address allocation systems is too important to national economies and other national goals for governments to be left on the sidelines. Experience has shown that the influence, authority, and close cooperation of governments is essential to accomplish ICANN's mission. Because of the significant advantages represented by a strong private-sector organization, however, we should seek a robust and effective middle ground - the right public-private partnership - that will incorporate the best of both extreme options. The attached Report lays out in more detail the reasons why ICANN cannot achieve its mission on its present course, and why deep reform is necessary. It further makes a series of proposals for reform that, I believe, will allow ICANN and the Internet community to accomplish its original mission. In summary, those proposals include: A. Reformation of the ICANN Board 1. 15 member Board of Trustees a) 10 At Large Trustees (1) Five nominated by governments and confirmed by Board of Trustees (2) Five nominated by open Nominating Committee process and confirmed by Board of Trustees b) Five Ex Officio Trustees (1) Chairs (or designees) of three Policy Councils and Technical Advisory Committee (see below) (2) CEO 2. Designee of Internet Architecture Board and Chair of Governmental Advisory Committee serve as non-voting liaisons to Board of Trustees B. Reform of the ICANN Policy Development Structure and Process 1. Three Policy Councils Providing Advice to Board of Trustees a) Address and Numbering Policy Council b) Generic TLD Names Policy Council c) Geographic TLD Names Policy Council d) Managed by Steering Committees composed of about half ex officio representatives of categories of relevant entities (registries, registrars, etc.) and half of persons nominated by Nominating Committee and confirmed by Board of Trustees e) Nominating Committee composed of non-voting Chair (selected by CEO after wide consultation), three members of Board of Trustees whose terms are not expiring, and four other persons appointed by Board of Trustees after consultation with and suggestions from community. 2. Two Standing Advisory Committees a) Technical Advisory Committee (1) Composed of ex officio members (designee of IAB, RIRs, root name server operators and name registries/registrars) and three other persons nominated by Nominating Committee and confirmed by Board of Trustees b) Governmental Advisory Committee 3. Two Additional Standing Committees a) Security Committee (appointed by Board of Trustees) b) Root Server System Operations Committee (root server operators and other invited persons by the Committee) 4. Participation in Councils by Self-Organized Forums (Individuals and/or Entities with Common Interests), including potentially an At Large organization for individuals C. Transparency and Accountability 1. Ombudsman a) Person of unassailable credentials responsible for managing public comment and other public participation b) Responsible for receiving and processing petitions for reconsideration, and other complaints and disputes; access to all necessary information to evaluate same c) Responsible for making recommendations to Board of Trustees with respect to complaints and disputes, and requests for reconsideration; all such recommendations to be published on ICANN website. d) Provided with support staff and other resources necessary to carry out responsibilities effectively 2. Manager of Public Participation a) Responsible for managing the public comment and participation process for ICANN on all substantive matters. Will solicit, receive and report to the Board on all public input on matters put out for public comment. b) Responsible for managing all ICANN public forums, public e-mail list, etc. Provided necessary electronic access to publicize findings and recommendations, all of which will be available to the public. c) Provided with support staff and other resources necessary to carry out responsibilities effectively D. Funding 1. Funding (for staff, general operations and additional requirements including root server operator compensation) must be significantly increased, and sources of funding broadened 2. Funding to come from both governmental and private participants 3. Funding to include both contributions for core functions and fees for services I offer this analysis and these recommendations with the hope of stimulating public discussion and debate. As explained in more detail in the attached report, I believe that ICANN must undergo significant reform if it is to be successful in its mission, and that this must happen quickly. I look forward to your comments and suggestions. M. Stuart Lynn ______________________________________________________________________ President's Report: ICANN - The Case for Reform 23 February 2002 INTRODUCTION ICANN is a bold experiment in the management of a unique global resource. Through sensible management of the DNS, the goal is to help maintain the Internet as a stable and effective mechanism for global commerce, communication, education, medicine and beyond. Because it was designed as a purely private sector body, and as such has no coercive tools or legislative powers, ICANN was to execute this mission solely through the voluntary development of consensus policies and the creation of bilateral agreements with relevant stakeholders. Notwithstanding the obvious challenges inherent in this approach, the hope was that ICANN could accomplish the necessary coordination and management tasks more quickly and more efficiently than the only apparent alternative - a multinational governmental body of some kind. We now have three years of experience in attempting to foster a transition from control by a single government over a somewhat informal system to a more formal system of global private sector coordination. This effort aims to bring together governments, Internet pioneers, the technical Internet community, infrastructure operators, and business and social organizations from around the world - all in a single entity, born in controversy and with no guaranteed source of funding. Moreover, ICANN was expected to begin to function even as it struggled to organize and secure funding. Many of the hoped-for participants were deeply suspicious of other important stakeholders, thus making a fully cooperative effort difficult. And all this was happening in the middle of an incredibly rapid expansion of the Internet from a largely scientific and research medium to a critical global communications medium integral to the commercial and social lives of hundreds of millions of the world's inhabitants. Many people, institutions, and governments have worked very hard to make ICANN succeed, and there have been some real accomplishments. Several private businesses stepped up to loan ICANN absolutely critical start-up funding (those loans have now all been repaid). ICANN developed and launched a system of competitive registrars, implemented a Uniform Dispute Resolution Policy to deal efficiently with domain name disputes, and introduced seven new global TLDs. On the operational side, ICANN has performed the IANA address allocation and protocol numbering functions efficiently, and taken over the direct operation of one of the DNS root name servers. In addition, a number of governments have provided critical support. The United States Government assisted ICANN in obtaining contracts with NSI/VeriSign, a critical stakeholder as the operator of the .com, .net and .org registries. The Australian government played a key role in providing funding to staff and support to the Governmental Advisory Committee, and in helping to move its ccTLD administration into the very first contractual arrangement with ICANN. The governments of Japan, Canada and others (including the European Commission) have also played key roles, and a number of governments have helped to host ICANN meetings. Despite all this, a candid assessment of ICANN's performance to date would have to conclude that it has fallen short of hopes and expectations. Despite a remarkably open policy process, needed participation has been lacking. Key participants that are essential if ICANN is to carry out its mission of global coordination - particularly most of the root name server operators, the address registries, and the majority of ccTLD registries - have not yet entered into agreements with ICANN (although we may be close to an agreement with the address registries and certain of the root name server operators). ICANN has struggled from the beginning with inadequate funding derived from too narrow a base. And it has been burdened - overburdened in my view - with too much focus on process and representation, and not enough focus on achieving its core mission. Even the global business community, which has now come to depend on the continued stability of the Internet for a large portion of their operations, has not - with some notable and stalwart exceptions - broadly participated in the ICANN process. I believe this is in major part because ICANN is viewed by many key stakeholders as more of a debating society than as an effective operational body. Thus, ICANN as it now stands is, at best, an incomplete experiment. In fact, it is clear to me that, without the steady and committed participation of all the major operational bodies of the Internet - including essentially all registries and registrars, significant ISPs and backbone providers, and the major users of the Internet - in the development of necessary policies, coupled with an agreement to abide by those policies once developed, this particular private sector model will not be able to fulfill its mission. In particular, ICANN has gone about as far as it can go without significant additional participation and backing from national governments. Absent a substantial increase in the efforts of governments to support and encourage the continued development of the private sector approach, I do not believe that ICANN will be able to complete the transition from US Government control to global private sector management of the DNS and related functions of the Internet. For the reasons set forth below, I believe that there is little time to make the necessary reforms. We must act now, or the ICANN experiment will soon come to a grinding halt. WHY THE CURRENT COURSE WON'T WORK ICANN's major problems can be broadly categorized into three categories: too little participation by critical stakeholders (across the full range of infrastructure operators, major users and national governments); too much focus on process; and too little funding to provide quality services. 1. Too Little Participation by Critical Entities. The essential participants in an effective ICANN are, in no particular order: (a) the various infrastructure providers of the Internet, broadly defined; (b) major users; (c) the relevant technical community and (d) national governments; There are many others interested in DNS management, including at least some portion of the broader Internet community, and it is important to ensure that all those with legitimate interest in ICANN have input to its processes and its decisions. But it is these participants that are absolutely essential for ICANN to carry out global management and coordination effectively. And their participation must be more than token. They must be actively involved; those that are part of the name and address operating infrastructure must be willing to agree to abide by the results of the ICANN policymaking process; and they must fund the process at levels adequate for ICANN to function effectively. It is worth describing in some detail why certain of these participants are essential. ccTLDs: An ICANN process without the full participation of the 243 ccTLDs cannot accomplish its core objectives of privatization and internationalization. More specifically, ICANN would be unable to deliver on two of its core assigned responsibilities: (i) assuring global DNS interoperability and stability; and (ii) delegating - through a framework of responsible agreements - non-technical policy matters to politically accountable local organizations, wherever feasible. Each of these objectives is embedded in the White Paper, and each has defined the ICANN internationalization efforts to date. Let me elaborate on each. First, global interoperability and stability. Without stable, formal relationships with the ccTLDs, the ICANN process would not be able to assure the preservation of interoperability with the vast majority of the entries in the DNS root zone file. While the majority of ccTLDs act responsibly, without binding and enforceable assurances that appropriate policies and standards will be followed there is no global guarantee that applicable standards will be maintained by all, at least no guarantee that would be credible to most major stakeholders. From the perspective of global interoperability, then, it is simply unthinkable that a large fraction of the TLDs in the root zone file should be permitted to operate independently of the global community and of policies established by the global community. In each case, it is essential that these critical entities formally agree not to break the DNS, and to abide by standard global operational practices arrived at through the ICANN process. Second, delegation of non-technical policy issues to local communities. A second key objective that could not be achieved without formal ccTLD agreements is the distribution (delegation) of politicized policy questions to locally accountable entities such as governments, or local self-regulatory organizations (such as Canada's CIRA for the .ca TLD or auDA in Australia), as provided for in the GAC Principles. By backing the GAC Principles for ccTLD management, the US and other governments have given strong support to the proposition that the global Internet community (through the ICANN process) maintains a responsibility for the formulation of global name and address policies (those affecting global interoperability and stability), while locally accountable institutions assume responsibilities for all other policy areas (including pricing, registration policies, dispute resolution, etc.). For ICANN to limit itself to its global coordination function, it must extricate itself from highly politicized local policy matters that arise most prevalently with ccTLDs. In nearly all redelegation cases, disputes over the administration of a local ccTLD turn on the determination of the will of the local Internet community - which, together with technical competence, constitute the criteria by which redelegation decisions are to be made, according to longstanding IANA policy. Consistent with the core ICANN mission, those responsibilities can only be devolved to local Internet communities if there are available meaningful and accountable alternatives to ICANN. For these alternatives to qualify as fully accountable necessarily requires some involvement and supervision by the local government or of a publicly accountable body that is recognized by the government. Without formal agreements, the global Internet community, working through ICANN, has today only one tool - albeit an impractical one - to ensure compliance with global policies by those (almost all) ccTLD administrators that do not have a binding agreement with ICANN: ICANN could, in theory, recommend that a particular ccTLD be redelegated to a cooperating administrator, and if the US Government accepted that recommendation, non-cooperating ccTLD administrators would be replaced. But this course of action runs counter to the basic ICANN mission, since it could be very disruptive, at least in the short term. What would solve the problem in many jurisdictions would be for national governments to use their good offices to assure the cooperation of their ccTLD administrators. As we have seen with Australia and Japan, national governments can take actions to create the proper environment for appropriate ICANN/ccTLD agreements. Without similar actions by other governments, for the most part this problem will not be solved. Thus, an ICANN with more active encouragement by national governments (as originally conceived) would be more likely to achieve the necessary agreements with ccTLDs that are critical to a successful ICANN. Root Name Server Operators: The root name server operators are a different story. These are not funded by ICANN but today are supported by the public-minded generosity of their sponsoring institutions and by the personal commitments of the individuals involved. Three root name servers are operated by US Government agencies; several more are operated at US locations, most by government contractors of various sorts (such as VeriSign). Three are outside the US, one each in the UK, Sweden and Japan. Today, the 13 root name server operators are the critical source of the single stable and authoritative root. It is essential that the root name server operators be full and complete participants in the ICANN process. That logically requires stable and appropriate agreements between ICANN and the institutions and individuals that operate the root name servers. After more than two years of discussions, we have reached a general consensus among the various root name server operators and ICANN on a form of MOU. But the progress has been agonizingly slow. Why? First, organizational inertia doubtless accounts for part of the inability to conclude agreements. The root name server operators with whom ICANN works are highly skilled technologists and network operations experts. They have voluntarily devoted countless hours to the Internet with little or no reward other than the satisfaction of their achievements. However, very often they are not the decision makers within their organizations who can commit to external agreements. Although the operators themselves may be comfortable with the MOUs, some of the decision makers may just be coming aware of what their organizations are being asked to agree to. Second, some organizations that sponsor a root name server operator have little motivation to sign formal agreements, even in the form of the MOU that is now contemplated. What do they gain in return, except perhaps unwanted visibility and the attendant possibility of nuisance litigation? They receive no funding for their efforts, so why should they take on any contractual commitments, however loose? Nevertheless, we have, I believe, reached consensus with the root name server operators that MOUs will increase the perception - and perception ultimately becomes reality - of stability of this critical resource. There now appears to be an understanding that these agreements are a necessary component of ICANN's progress towards a more formalized structure for administration of the name and address system. Of course, there is still an issue about what kind of agreements are appropriate. What we have been working on is an agreement that merely documents the existing situation. Over the longer run, however, more formal documents will be needed, given the critical nature of these components of the DNS. In addition, we must move to a system where the root server operators are compensated for their critical services. Thus, for a fully effective ICANN, capable of accomplishing its mission, we will ultimately need a more definitive and binding set of arrangements with the current and any future root name server operators, and that will require significantly greater funding than is presently available to ICANN. Address Registries: The address registries are similar to the ccTLDs in the sense that there is only a small, but important, element of global coordination required in this area. Most address policy decisions can be made at the regional (RIR) level, but ultimately there is a small aspect of absolutely necessary global coordination. We are close to agreements with the RIRs, but those agreements (which have been heavily negotiated over the last two years) are arguably incomplete in two respects: (a) they allow the address registries to opt out of ICANN policies with which they do not agree, by taking the ultimate step of terminating the agreements, and (b) they include special limitations on the proportion of ICANN's funding requirements that the address registries will provide under those agreements. While these are not fatal flaws by any means, given the cooperative nature of the RIRs - and are not the most critical issue facing ICANN - they are another illustration of the difficulty in gaining the necessary voluntary and complete cooperation of all the critical participants needed for ICANN to accomplish its mission. Major Users, ISPs and Backbone Providers: The vast majority of the business community (outside of the registries and registrars who are most directly affected by ICANN's policies) has chosen not to participate in the ICANN process. There have been, of course, some notable exceptions among a few corporations and trade organizations, but these are a minority. ICANN is very grateful to those organizations that provided the funding that was so critical to ICANN's early survival, but outside of those registries and registrars who are contractually committed, broad participation by those commercial entities that most depend on a reliable Internet has not been forthcoming. During the past few years, the Internet industry and its trade associations have faced enormous challenges, including a recessionary economy that has left many companies struggling for survival. So it is understandable that the very industries that have invested hundreds of billions of dollars in the infrastructure of the global Internet (not to mention the broader global business community that relies so heavily on the Internet for commercial activities) has devoted shockingly little time to participating in ICANN - shocking, given that failures in the name and address allocation systems could inevitably have serious adverse effects on their businesses and, through them, on every person and entity relying on the Internet. As a result, the ICANN policymaking process is impoverished by the absence of most of the entities with the greatest direct interest in DNS stability and those whom its decisions will most directly impact, and by the consequent overrepresentation of advocates for one special interest or another. While this lack of participation by those who critically depend on the successful fulfillment of ICANN's mission may be explainable, it puts enormous pressure on what is supposed to be a consensus development body to come up with responsible policies when major stakeholders are silent. This is also true for other private sector institutions, ranging from academia to NGOs. There has been some isolated participation by a few from these communities, but this participation has focused far too much on process and procedure, impeding ICANN's ability to reach timely decisions on important substantive issues. The simple fact is that a private sector process cannot effectively function if major and important elements of the private sector do not participate productively in that process. National Governments: Perhaps the above points are self-evident. What may not be quite so obvious is my conclusion, based on all our experience to date, that active national government participation in ICANN is critical to its success. Indeed, in the final analysis, national governments are perhaps the most irreplaceable supporters of ICANN, in the sense that - notwithstanding the efforts or desires of other stakeholders the backing of governments is necessary if private sector coordination of the Internet's naming and address allocation systems is to be feasible. If governments choose to take direct responsibility for the management of the name and address systems of the Internet, they have the power to do so. And even if they do not make that choice, given the importance of the global resource that ICANN has been established to coordinate, it is unrealistic to think that governments will simply sit by and allow ICANN's processes to work without their careful attention and review. Today, the Governmental Advisory Committee is the only formal mechanism for governmental input into ICANN. Despite significant effort by many of its members, it has been only a minimally acceptable vehicle, partly because of a lack of adequate commitments by the world's governments and partly because of the Internet community's own ambivalent attitudes (reflected in the attitude of ICANN, which is a composite of that community) towards government involvement. In addition, while all governments are invited to participate, the existence of the GAC has not generated the scope of governmental participation and commitment that is necessary for ICANN's long-term success. I recognize that proposing an increased role for governments in ICANN is a significant departure from the original conception of ICANN as a purely private sector body, but I am convinced an increased governmental role is essential if ICANN is to carry out its mission. Appropriate national government participation would contribute greatly to the success of ICANN in at least two ways. First, it could provide the public interest accountability that all agree should be a part of any global ICANN-like organization. Second, it would increase the likelihood that governments would more effectively encourage the participation of their national citizens and entities that is critical for ICANN's success. If one thing is clear from the past three years, it is that a purely private entity that must depend on the voluntary cooperation of many other entities is not likely to be able to coordinate anything globally without significant governmental support. Indeed, each of ICANN's accomplishments to date have all depended, in one way or another, on government support, particularly from the United States. With respect to the legacy registry/registrar provider for the com/net/org TLDs, NSI (now VeriSign), US government help was critical to obtaining ICANN's first registry agreements. All the other agreements that ICANN has achieved have depended, ultimately, on the willingness of the US government to make it clear (to its direct contractors and all others) that it was not receptive to changes in the authoritative root zone file that were not managed through the ICANN process. Especially as to those registries that see ICANN as a threat to their independence, and are unwilling (despite all the rational arguments and history to the contrary) to accept voluntarily the existence and authority of a global coordinating entity, the influence of national governments can be critical to the creation of a complete, well-balanced and effective ICANN. National government participation, in my view, is also essential to end the Sisyphean effort of searching for a workable public accountability mechanism for ICANN. Three years of effort have proven that a global online election of ICANN Board members by an entirely unknown and self-selected membership is not a workable solution to this problem. While virtually everyone seems to agree that ICANN should have Board-level representation of the broad public interest of the global Internet community, there has been no consensus around the best method of achieving that representation. The problems are manifold, and not unique to ICANN. The world lacks a global voting pool, or even a consistent way to verify human identity; the notion of a special-purpose, no-cost, self-selected "membership" arising from thin air has quite reasonably generated strong fears of capture, fraud and abuse. Purely electronic online voting has been proposed in a number of different circumstances throughout the world, and continues to find more skeptics than supporters among the experts. It is simply unrealistic to expect ICANN - thinly-staffed, underfunded, technically-oriented ICANN - to be able to achieve what no other global institution has: a global electorate expressing its will through stable representative institutions. For three years, this issue has dominated the ICANN agenda, occupied a considerable portion of very limited resources, and despite all this effort has still not produced a acceptable plan. Indeed, I would argue that even if we had found a workable process, this approach was not likely to be the most effective way to provide the accountability that all agree is necessary. At best, a global election process is a gamble; as we have seen, it is entirely possible that irrelevant factors other than the stability and security of the DNS may motivate a very large segment of any conceivable electorate. Although governments vary around the world, for better or worse they are the most evolved and best legitimated representatives of their populations - that is, of the public interest. As such, their greater participation in general, and in particular their collective selection of outstanding non-governmental individuals to fill a certain portion of ICANN Trustee seats, could better fill the need for public accountability without the serious practical and resource problems of global elections in which only a relatively few self-selected voters are likely to participate. As this recitation demonstrates, ICANN must have the active participation of those critical to ICANN's effectiveness in accomplishing its assigned responsibilities. Without that participation, it makes little difference whether ICANN is transparent, whether it has appropriate appeal and reconsideration procedures, whether ordinary users have a voice, or whether the Board meetings are public or private. If the ICANN effort is to succeed, we must refocus on what is necessary before worrying about what is desirable. The active participation of those groups identified above is essential to ICANN's success - and as I have suggested, even its viability. 2. Too Much Process. ICANN was born with a particular and intense focus on process and representation. Undue focus on process to the exclusion of substance and effectiveness is the second major problem facing ICANN. In many ways, ICANN's creation was a political exercise, working from the outside in: what structure is required to secure the participation of this group or that group? The result was an entity in which most of the groups seen to be essential at the time were willing to participate, but not necessarily in a way or within a structure that was designed to be effective. The driving notion at the time of ICANN's creation was consensus; it is clear to me that the driving notion today, with the renewed focus precipitated by the events of 9/11, must be effectiveness. Like any institution with responsibility for key infrastructure, ICANN must be able to act when needed. This is not to say that process, participation or representation are irrelevant or undesirable. They are highly relevant, but they must be viewed as means to achieve ICANN's goals, not ends in themselves. ICANN's primary focus must be effectiveness, in the broad meaning of that term, in carrying out its mission. If ICANN is not effective, what advantage does it have over a purely governmental solution? And process - while necessary to appropriately identify and accommodate differences across a wide variety of views and motivations - must surely also be shaped so that it does not seriously impede effectiveness and progress. Process that prevents effectiveness is a failure. The intense focus on process at the time of ICANN's creation was in part driven by a reasonable desire among some to shield the Internet from hasty, unsophisticated or foolish decisions by ICANN, a new and untested institution. However, that impulse, coupled with a widespread failure to understand ICANN's inherently limited scope and lack of coercive authority, caused the creation of ever-more procedural loops and layers at the expense of overall Internet-speed effectiveness. There were even attempts to cause ICANN to implement the thousands upon thousands of pages of administrative and regulatory procedures that apply to US government agencies - a move that is totally inconsistent with the reason for creating a private sector organization in the first place. This focus on process was also produced by what in hindsight was oversensitivity to the possible involvement of governments and governmental bodies in ICANN. The fact is that the Internet, and therefore management and coordination of the naming and addressing functions of the Internet, are critically important to governments, because they are critically important to their citizens and businesses. It is naïve to assume that governments will not be heavily interested and involved in global policymaking for these areas. In the current ICANN structure, however, government involvement is limited to the advisory function of the Governmental Advisory Committee. The disconnect between this theoretical limitation, and the actual power and influence of governmental bodies on the management of such a critical global resource, has been increasingly evident in the tension between the GAC and other parts of the ICANN structure. This deliberately limited role of governments in ICANN inevitably fueled demands for other and different accountability structures. Since ICANN would eventually "control" an important global resource, the argument went, it must be accountable to those affected by its decisions. These include, at least abstractly and in the view of some, every person and entity in the world. Thus, we have seen calls for global elections by all interested individuals, and demands for Board representation and other indicia of status by various groups and affected entities. One of the reasons why ICANN has not yet generated the necessary support and involvement of critical stakeholders is that many participants in the ICANN process have devoted very significant attention to various non-core issues that should not, in my opinion, receive such overwhelming priority. The effect of these distractions has been ICANN's appearing to many as a collection of squabbling interests, tied up in an elaborately complicated organizational chart. The single largest distraction from what should have been the central ICANN focus has been the many competing notions of an At Large membership. Some - understandably but very mistakenly in my view - perceive this as a necessary effort to generate legitimacy for a non-governmental organization like ICANN. They believe that because ICANN is not itself a governmental organization, it should build its own government-like institutional foundations on a global scale. The argument goes that, since ICANN makes decisions that can be construed as public policy, the public needs a voice, and that can best come through world-wide online elections. Perhaps, but when it comes right down to it, governments or bodies appointed with government involvement can, it seems to me, certainly stake a better claim to truly reflect the public interest than a few thousands of self-selected voters scattered around the world. I am now persuaded, after considerable reflection, that this concept was flawed from the beginning. The notion is noble but deeply unrealistic, and likely to generate more harm than good. We now have three years of very hard effort by a wide variety of people to arrive at some workable consensus solution - and there still is none. If a blue-ribbon committee - headed ably by a former Prime Minister of Sweden and United Nations Representative to Bosnia, and populated by highly respected and hardworking members - cannot generate a community consensus on this subject, it is likely there is no consensus to be found. A very significant portion of the total resources devoted to ICANN over the last three years has been spent trying to solve the tension between the desire for more government-like representation and accountability, on the one hand, and a workable, effective and stable ICANN on the other. It is now time to recognize that effectiveness in the management and coordination of name and addressing policies is the primary objective of ICANN, and that process and representational values must be served in ways that are compatible with the primary objective. To do otherwise is self-defeating; if ICANN is not effective, it will fail, and all the process and organizational structure in the world will not save it. A multi-national governmental substitute for ICANN will not be likely to provide the kind of process that some believe is essential for ICANN. For all these reasons, I have come to the conclusion that the concept of At Large membership elections from a self-selected pool of unknown voters is not just flawed, but fatally flawed, and that continued devotion of ICANN's very finite energy and resources down this path will very likely prevent the creation of an effective and viable institution. We must find another, more effective path for appropriate input into the ICANN process by the general user community that will accomplish the key purpose underlying the At Large concept - to ensure that the broad public interest is effectively reflected and protected in the ICANN consensus development process. I cannot emphasize this point strongly enough: I believe strongly in ICANN's core values of openness and participation. An ICANN that is insulated from input and involvement by individuals across the global diversity of the Internet would be a failed ICANN. Though some will doubtless try to characterize it otherwise, my conclusion about the unworkability of At Large membership elections is NOT a criticism of the concept of participation by individuals. On the contrary, I believe that a reform of ICANN must result in greater openness, wider diversity, and clearer, more meaningful avenues for individual and organizational participation. The endless disputes over the feasibility and desirability of online elections represent a significant example of how much of the finite amount of ICANN energy available from a largely volunteer cadre has been drained on topics that are almost orthogonal to its key mission, but it is not the only one. The reconsideration process is another, where precious staff and Board time have been devoted to what are often clearly frivolous requests. The incipient Independent Review Panel has all the hallmarks of adding to this waste. For sure, ICANN requires an appropriate attention to process, and there must be adequate procedures to channel and protect the integrity of that process, particularly across as diverse a community as the ICANN process seeks to attract. But in my judgment, the current ICANN attention to process has gone overboard. It is time to get our priorities straight, and to reform ICANN's structure and procedures so that they all assist, rather than impede, the achievement of its core mission. 3. Too Little Funding. Finally, the third major problem is inadequate funding. ICANN began its existence with no guaranteed funding from any source - governments or private entities. Indeed, it survived its initial days only because of loans from public-spirited businesses (and the great good fortune that it was launched during the boom, not the bust, part of the global business cycle). It survives today on a heavily negotiated revenue stream generated from a small number of very interested intermediaries - who also have major influence in establishing the ICANN budget. Perhaps it is not surprising that ICANN has been seriously underfunded from its creation. I believe ICANN is underfunded for the following reasons: * There is a significant shortfall each year even within current budgets, because - without agreements in place - ccTLDs do not bear their appropriate share of the burden. There has been a $400-500,000 shortfall each year, a number that seems likely to increase absent a dramatic change in ccTLD attitudes. In addition, the RIRs, in the absence of any agreements with ICANN, have yet to contribute (although those funds have been put in escrow awaiting the completion of the necessary agreements). * ICANN has accommodated that shortfall only through not hiring to authorized levels, and at the expense of building reserves. The former means that work is not done effectively; the ICANN process is dangerously understaffed, and has always been understaffed. The latter is extremely risky financially, as it would be for any organization, allowing for no unexpected expenditures including, for example, litigation expenses. Experience has taught us that, although it cannot be planned for precisely, litigation in this area is inevitable, and this is likely to increase as the complexity of ICANN's tasks increases. * Even more importantly, existing budgets would be completely inadequate even if fully funded. ICANN has little or no backup of key individuals, making the organization extremely vulnerable to the loss of those key people. This could lead to serious instabilities in certain circumstances. Beyond that, there are too few staff to do a proper job - even while many current staff are already working unsustainable long hours. A corollary is that clearly there are too few staff to shoulder additional responsibilities, such as security, contract monitoring and compliance, contracting out for network monitoring services, coordinating IDN policy, etc. And ICANN has no funds to pay for unanticipated expenses, to engage in the kind of public communication process that an organization like ICANN should undertake, or to undertake the costs of root server operations - just to list a few of the tasks that many believe an effective ICANN would undertake. To be effective, ICANN has to have enough of the right kinds of people (and support services) to do the tasks required. Because it has not had sufficient active participation from critical entities, and because the conceptual goal has been to fund ICANN at only the minimal level necessary, it has not had the funds to hire the right number of people with the right talents. The inevitable result is that services cannot aspire to desirable levels and much is postponed or undone. This is not to denigrate the efforts of what I regard as an outstanding ICANN staff - they are all overworked and underhelped - the service and support they do provide is enormously impressive under the circumstances. But ICANN today cannot do everything it should do or in a timely manner. Perhaps even more importantly, the ICANN process as presently funded will never be able to fulfill its intended coordination and consensus building tasks, its IANA and other technical tasks, its security responsibilities, its legal coordination and contract monitoring tasks, and its management tasks. Furthermore, costs are increasing even to pursue its current activities. Overall, the ICANN process is understaffed by at least 10-12 fulltime employees, and possibly more - depending on what it is expected to accomplish. A fully funded ICANN probably requires an operating budget of 300-500% of its current budget level, plus funding for significant one-time expenditures if funding of root name server operators and the establishment of appropriate reserves are included. This level of needed funding requires a very different kind of funding structure from the one that exists today. My conclusion is that the funding sources of ICANN must be broadened, and overall funding must significantly increase. Today, ICANN depends entirely for its funding on the cooperation of those entities who generate revenues from servicing the names and address space, who essentially serve as intermediaries between ICANN and the name registrants that are the ultimate source of those funds. This is a limited number of entities, and thus leaves ICANN overly vulnerable. In addition, it means that the other participants that are critical for ICANN's success do not have an immediate or direct stake in the ICANN budget. All of the participants in the ICANN process that have the ability to pay a share of ICANN funding should do so. With "skin in the game," these participants will feel a more immediate and direct connection to the success of the ICANN process. And this includes governments. MISSION IMPOSSIBLE? Without participation by necessary stakeholders, without the proper focus on progress and effectiveness over process, and without the funding necessary to carry out its mission effectively, it is simply unrealistic to assume that ICANN will be able to complete the transition to fully independent private sector administration of the DNS and related policy issues. One might then reasonably ask "So what?" Why not just continue with the status quo? For this to be a feasible alternative, the status quo must be sustainable, reflecting as it does an incomplete transition. In my opinion, the status quo is not sustainable. First of all, for the reasons described above, ICANN does not have the necessary resources even to continue at the current level of operations. This is especially true if those inadequate resources continue to be diverted to matters (like At Large elections) that are really not central to ICANN's mission. Today's funding model is neither adequate nor sustainable. Second, the current role of the US Government is not consistent with long-term global stability. ICANN has attracted considerable international participation to date, but this gratifying response has been founded on a belief that it would shortly result in the transition of the DNS away from US Government control to an international policy process, represented by ICANN. ICANN itself has been successfully internationalized; there are now only six US citizens on ICANN's 19-member board. That board (and many in the ICANN community) is increasingly restive with continued dependency on unique US government involvement, and if that is seen as an indefinite fact of life, international participation in ICANN will inevitably diminish. Thus, without a realistic prospect of a successful transition - and that prospect, in my view, is not realistic with an ICANN as it is currently structured and operates - international support for ICANN will fade. If ICANN comes to be seen (as is starting to happen in some quarters) as simply a tool of the US Government, it will no longer have any hope of accomplishing its original mission. At that point, at least some (and I believe many) of the current ICANN participants (Board, staff and volunteers) may well choose not to continue in what is, after all, a highly draining and thankless task. Third, and potentially most critical, a weak ICANN makes some of the Internet's essential infrastructure needlessly vulnerable to external threats - fragmentation of the name space, alternate roots, non-interoperable internationalized domain names, anticompetitive exercises of market power, and even security threats. Use of alternate roots now occurs within tolerable bounds because the community as a whole understands the necessity of a single unique name space, and therefore a single root, and because it prefers to work within the ICANN process. A permanently weak ICANN would likely change that situation, and would certainly encourage even more aggressive efforts by entrepreneurs, powerful commercial interests, and perhaps some governments to put self-centered, short-term advantage over global cooperation, universal interconnectivity, and long-term stability. The introduction of internationalized characters into the DNS is a very difficult issue and in itself could lead to fragmentation of the Internet with alternate, centrally-controlled roots being established in furtherance of real or trumped up nationalistic concerns. As was clearly shown at ICANN's Security Meeting last November, the DNS is today very robust and resilient. Security is taken very seriously, but ICANN's ability to implement needed improvements (for example, at the root name server level) is jeopardized by lack of funding and lack of full participation by critical partners. All of these are examples of the kinds of threats that a weak ICANN will find very difficult to resist. Simply put, an ineffective ICANN virtually invites the fragmentation of the Internet by those with parochial commercial, cultural, or political interests into zones that cannot reliably communicate with each other - an outcome that would be profoundly negative for the Internet and would seriously retard its continued growth as a global medium to support critical commercial and social goals, and a medium for communication and expression. THE NECESSARY REFORM AGENDA This is a bleak picture, but I believe it is realistic. I do not have any historical baggage; I was not there at the creation. I have nothing to protect from the beginning. But I do have the responsibility for trying to manage ICANN, and I am accountable for its actions during my tenure. I am also responsible for making sure that the Board and all ICANN stakeholders have a clear picture of ICANN's successes and failures, and of its future prospects. Today, its legitimate future prospects are, in my judgment, non-existent, unless we engage in meaningful reform of ICANN's structure and operations. Either we need a renewed commitment to ICANN's original mission, accompanied by a clear focus on the specific steps that need to be taken to put ICANN in a position to accomplish that mission, or we need to consider whether ICANN should seek to withdraw in favor of a different global coordination approach. Just because it is a bleak picture, however, does not mean that there is nothing we can do to make ICANN work. ICANN's original mission was and is both worthwhile and intelligent and, if it can be carried out effectively, would redound to the benefit of the entire global Internet community. We must, however, step up to the reality that major reform is necessary to make that happen. The problems I have outlined cannot be solved by tinkering with one aspect of ICANN or another, trying to eat the elephant one bite at a time. They require a fresh approach. The reforms I propose will require new thinking and a new mindset. They will not appeal to those whose thinking is limited to self-interest in a narrow sense. They will be embraced, I hope, by those who see their self-interest within the broader context of what is good for the community as a whole. In what I propose, many will see themselves as both "winners" and in some limited sense as "losers." But the overall mission and an effective ICANN will be a clear winner. What is needed today is to reform ICANN, and to do so from the inside out, beginning with the core mission and crafting a structure that can be effective to achieve it, not just one that has the broadest popularity. With that as the goal, what is essential to ICANN's effectiveness? First, it is intended to manage a global resource, so it must have a structure that is consistent with that objective. That means ICANN must have an effective, geographically diverse international managing body. As has been noted by many members of the community, ICANN's mission is a public trust. It should therefore be managed by a Board of Trustees. 1. The Board of Trustees. ICANN needs an international Board of Trustees composed of serious, competent people. The ICANN mission is a serious responsibility, substituting for international governmental management of a critical global resource. It requires high-quality, dedicated people who are widely perceived by key stakeholders as competent to guide this public trust. To date, it has been assumed that we could find enough such people, beholden to the public trust and not to special interests, to volunteer for this mission, and in large part ICANN has been fortunate that this has so far been the case. But it is risky to assume this will always be the case, especially given the vagaries of election processes that can be captured by special interests. Thus, we have to have more affirmative ways of seeking out the kind of Trustees that are needed. I would propose that 10 of a total of 15 Trustees should be selected At Large. A certain portion of these At Large Trustees (I would recommend five of the 10) should be selected in some way by national governments, in their capacity as stewards of the public interest. This would accomplish two objectives: (1) it would serve the goal of public accountability, and (2) it would heighten the level of interest and participation by national governments in ICANN. Governmentally-selected Trustees would be expected to bring on the Board of Trustees the perspective of the broad public interest, and are more likely to be effective advocates for it, and less likely to be narrow partisans of particular interests. Compared with other methods of supplying a publicly-accountable presence on the Board, this solution conceptually would also be orders of magnitude simpler as an administrative matter, and considerably less costly. I suggest that the five governmentally-selected At Large Trustees should represent the ICANN five geographic regions. The details of that selection process should be left to the governments, although it could be imagined that these selections could be made either by regional governmental organizations or, alternatively, by the ICANN Governmental Advisory Committee. To avoid conflicts of interest and anxieties about primary loyalties, I also propose to retain ICANN's current rule disqualifying governmental employees with policymaking responsibilities. In other words, I would have governments choose a set of non-governmental Trustees to represent the broad public interest. As representatives of the five ICANN geographic regions, the At Large Trustees would advance the goals of both public accountability and geographic diversity. The remaining five At Large Trustees should be selected through an open and consultative Nominating Committee process. The NomCom should be composed of both Trustee and non-Trustee members. Its task would be to identify highly qualified, respected and knowledgeable leaders with the essential skill sets and experience, and of diverse geographical and functional backgrounds, who are not necessarily or primarily representatives of interest groups or entities. Because the ICANN structure should feature direct input to Trustee deliberations from those most knowledgeable about the technical and policy issues that will come before them, I suggest that the remaining five Board of Trustee seats should be filled ex officio. These five Ex Officio Trustees should include the CEO, the three Chairs of the Policy Councils described below, and the Chair of the Technical Advisory Committee. In addition, the Chair of the Government Advisory Committee and a person designated by the Internet Architecture Board should each be a non-voting ex officio member of the Board, to ensure close coordination with those critical bodies. The current Board, I believe, is somewhat larger than desirable, and thus I would reduce the new Board of Trustees to 15 people. Since the current terms of the four remaining original directors expire later this year, at the same time as the current At Large directors, the new Board of Trustees could be smaller than the current Board simply by not filling four seats. Terms should be staggered to ensure that only 1/3 of the Board terms expire in any given year. However, continuity is very desirable, and I would propose that At Large Trustees be allowed to serve up to two consecutive three-year terms, subject to renomination and reappointment at the end of the first three-year term. Obviously, this proposed Board of Trustees, while still representative of the ICANN stakeholder communities, is largely not the product of elections. This is because the principal objective is to produce an effective Board of Trustees, not to allocate seats to interest groups or constituencies, or to replicate online the vast array of governmental institutions needed to assure fair elections. Of course, it will be critical that all portions of the community feel that their interests are understood and given due consideration by the Board of Trustees, but that does not mean that the selection process must inevitably be electoral, in the sense of governmental elections based on universal suffrage. As my suggestions for the Policy Councils described below make clear, a reformed ICANN must be a broadly participatory body, and it must be organized to facilitate bottom-up discussions and ideas. But it must also be something that actually is workable, so those discussions and ideas can be translated into actions when needed. To me, this means that the selection of Trustees should be based on individual credentials and skills and the willingness and ability to contribute, and not on personal popularity, interest group agendas, or the ability to recruit a small but sufficient number of self-selecting voters. 2. Staffing and Funding. Even a very active, engaged Board will not be intimately involved in day to day activities. And there are many such activities, ranging from the IANA functions to technical services to contract administration to public information and education, in addition to policy development and general administration. An effective ICANN, like any other business entity, would first catalogue the tasks that are necessary or desirable, calculate the cost of hiring the people and providing the resources necessary to carrying out those tasks in a timely and effective way, and then generate a funding structure that provides the necessary funds to meet those needs. In other words, funding should be driven by needs, not by the desires of individual participants. While there is certainly merit in generating input from all affected entities, it is unworkable to provide everyone subject to ICANN policy processes with an effective veto on the funding necessary to carry out the ICANN mission. The current funding process is yet another derivative from the notion that, as a purely private entity, ICANN should depend on the consent of those subject to its policy control. This had its conceptual deficiencies at the time ICANN was first created, and practice has proved those concerns valid. Clearly, not all those who should be involved in the ICANN process have had an interest in fully funding ICANN operations. Thus, the Board of Trustees and ICANN staff should be responsible for producing the budget, with a fully transparent process for input from the ICANN community. The accountability that was the goal of the original process can be provided by an open budget development and explanation process, and by the participation of the At Large Trustees in those decisions. In order to both broaden the funding base, and generate the level of funds needed, ICANN should combine core funding (generated from governments and those entities that enter into agreements with ICANN) and fee-based funding (generated from those other entities that either participate in the ICANN policy development process or utilize various ICANN services). 3. Policy Development Structure. It is unnecessary for all Trustees to be intimately knowledgeable about the technical aspects of the issues they will address. After all, they are not writing code or creating protocols, but rather are charged with making policy and management decisions. They do, however, need to have access to, and input from, technically qualified people and entities. The current ICANN concept is based on the notion of "bottom-up" policy development, with the Supporting Organizations responsible for the development of policy and the Board theoretically just the implementing device for those policies. In hindsight, the notion of truly "bottom-up" consensus decision-making simply has not proven workable, partly because the process is too exposed to capture by special interests and partly because ICANN relies entirely on volunteers to do all the work. Furthermore, those who are affected by policy decisions should have a clear role in generating the record on which those policy decisions are based and in providing thoughtful advice to the Board of Trustees. This analysis leads me to suggest the replacement of the current Supporting Organizations with several Policy Councils. These would include an Address and Numbering Policy Council, a Generic TLD Names Policy Council, and a Geographic TLD Names Policy Council. In order for them to be most effective, each of these Councils should be supported by the appropriate staff, and should be managed by a Steering Committee made up of some ex officio seats (for representatives of various categories of entities) and some persons nominated through the NomCom process described above, and confirmed by the Board of Trustees. In addition, the Governmental Advisory Committee would continue, and a new Technical Advisory Committee would be created. The current Root Server System Advisory Committee would continue as the Root Name Server Operations Committee. Finally, the newly formed Security Committee would continue to have responsibility for advice and coordination in its critical area. In the interest of creating both a broader base of funding and encouraging full and active participation by critical stakeholders, full participation in the Policy Councils and Advisory Committees should be linked where appropriate to participation in ICANN funding. For example, only those registries and registrars that have agreements with ICANN should be eligible for full membership in a Policy Council, including having representatives sit on the Steering Committees. It may also be appropriate for similar conditions to apply to other participants in the Policy Councils as well. In addition, we should explicitly and permanently abandon the notion that every individual with an interest in DNS policy has some "right" to equally weighted participation in ICANN, no matter what the impact on ICANN's effectiveness. This conclusion is driven by a focus on the core ICANN mission of effective management of global name and address policies. The general public should have a right to an effective notice and comment process, to give input before major decisions are made, and to observe the policy-making process, but we have seen that unlimited "rights" to full and equal participation by every individual who finds this area interesting are not consistent with an effective ICANN. Thus, while membership in the Policy Councils should be tilted toward expert talent and directly affected stakeholders, each Council should be open in some fashion to the participation and contributions of interested individuals and organizations. To achieve that, I propose a reformulation of the constituency concept. In order to help generate participation, facilitate meaningful deliberation, and structure input, the currently existing DNSO constituencies would be invited to reconfigure themselves and continue as self-organized, cross-Council Forums within ICANN. The Forums could then participate in each of the Councils, offering input, developing and evaluating proposals, and advocating on behalf of their members, as they see fit. For example, the ISP Forum would be a channel for its members to formulate and give input about gTLD, ccTLD, and addressing policy issues, and would be a venue for input to the Nominating Committee. The Forums would be expected to re-orient away from debates over procedure and toward deliberations on substantive DNS policy matters. As it currently the case, some Forums would be by definition limited to members defined by the existence of a contractual relationship with ICANN (i.e., the gTLD registries, ccTLD registries, and gTLD registrars), while others would be more open and defined by function (i.e., ISPs, business, non-commercial, and intellectual property constituencies). New Forums could be created as well; by eliminating the current concept of mathematically equal representation for each Forum on the Names Council, ICANN could more readily develop and implement well-defined criteria for recognition of new self-organized Forums (for example, we might imagine Forums for university and academic networks, individuals, small business users, backbone providers, etc.) without encountering resistance from existing Forums due to a feared dilution of influence. Let me say a few words about how I think the concept of an At Large organization fits into this reformed ICANN structure. The At Large Study Committee's Final Report contains a range of well-developed suggestions and good thinking about how an At Large organization could be structured to help ICANN increase meaningful substantive participation from individual Internet users around the world. Working from the current ICANN terminology, the ALSC labelled this an At Large Supporting Organization. I fully agree with the ALSC that ICANN would benefit greatly from an At Large organization that could conduct outreach, foster deliberation, and attract new ideas and voices to the ICANN process. I believe that a reformed ICANN should include this kind of At Large entity, designed to connect individuals in a very open and direct way to the ICANN process. In further dialogue with the ALSC and the community, I hope to explore how their concept of an At Large organization can best fit into a reformed ICANN. 4. Transparency and Process. As already mentioned, ICANN is today being strangled by process. Process has been allowed to become the predominant value in ICANN decision-making. The DNS management system that Jon Postel operated so effectively in the past had no definitive obligation to particular processes, and it certainly was not transparent - but it worked! We cannot recreate Jon Postel or his processes, and indeed they would probably not work well today. But to achieve a reformed ICANN, we do need to start from the inside out - with the goal of effectiveness - rather than from the outside in. Once we identify a workable structure, process and transparency can be achieved in a manner compatible with that primary objective. This does not suggest a secretive and opaque organization. In fact, an effective ICANN must be very transparent, and certainly will need to have available open processes to ensure that all relevant inputs are considered and that policy decisions in fact contribute to the objective of a stable and effective DNS. Central to the ICANN experiment - and integral to its successes thus far - have been core values of openness and broad participation. I believe strongly in those values, and aim to strengthen them in a reformed ICANN. ICANN can and should do much better in achieving transparency, enabling meaningful participation, and reaching out to involve the global diversity of the Internet. Likewise, I believe strongly that ICANN needs an intelligent framework of meaningful checks and balances, but I believe we can do much better than the existing ICANN structure. There are certain key principles that I suggest are critical to a reformed (and successful) ICANN: (1) the Board of Trustees must be able to make policy decisions, not simply ratify or reject those proposed by subordinate bodies; (2) the Trustees must have the ability to deliberate in private; and (3) with a properly funded and independent Ombudsman in place, there is neither a need or justification for some independent review mechanism process that creates a "super-Board" for some purposes. This implies that: A. The Policy Councils should clearly be identified as advisory bodies, and their advice to the Board of Trustees should be given strong weight based on its persuasive merits, but not presumptive validity. Experience shows that the DNSO, the only Supporting Organization with more than four members, has been only marginally effective in generating policy decisions, or even in giving policy advice. In part, this results from a lack of full-time staff, which places the entire burden of policy development on the hardworking volunteers who must try to advance policy proposals through the DNSO's complex and noisy crowd of working groups, constituencies, and the Names Council. In a reformed ICANN, the Policy Councils should be appropriately staffed. But in part the characteristic gridlock in the DNSO is a function of the inevitable difficulty of consensus development among parties with self-interested but conflicting goals. This difficulty has been aggravated by the notion of presumptive validity, which has freed the Supporting Organizations from the discipline of having to develop persuasively supported recommendations. I do not subscribe to the proposition that a lack of consensus means that there should be no action; this may be the case on any given issue, but it certainly is not a universal truth. To be effective, the ICANN Board of Trustees has to be clearly empowered to make decisions even if there is no clear consensus, to the extent they see it necessary to carry out the ICANN mission. This does not mean that the ICANN Board of Trustees should be able simply to ignore advice from its Policy Councils. For starters, the composition of the Board of Trustees, with its Ex Officio Trustees including the Chairs (or their designees) of each Policy Council, suggests that is not very likely in any event. The Board of Trustees should be required to carefully consider any recommendations from its Policy Councils, and to clearly set forth its reasons in the event it chooses to not accept those recommendations. The Board of Trustees should be required to give timely advance public notice of all matters it considers, and to publish in a timely manner full and complete minutes of its meetings. In other words, the Board of Trustees should act appropriately to a body entrusted with a global responsibility - openly and transparently, but also effectively. B. The very expensive and time-consuming quarterly meetings held at locations around the globe are neither necessary nor desirable. The current Board has already reduced the number of such meetings to three for this year, and I believe that there should only be two such meetings each year. Of course, the Board of Trustees, to be effective, must meet more often than two or even four times a year, as the ICANN Board currently does, with most meetings telephonic. In addition, the Trustees must be able to discuss matters in private, as the current Board does today - by telephone, by personal discussions, by email and otherwise. In fact, the only Board meetings that are public today are the quarterly meetings, and the picture of the ICANN Board up on a dais in a public auditorium contributes nothing to the goal of effective management of DNS policy. These geographically scattered Board meetings have had some value to the local Internet community, frequently increasing its profile in the broader community in a beneficial way, and thus I would not eliminate them entirely, although it would be nice to find ways to accomplish that end without the substantial cost of the entire traveling road show. The direct costs to ICANN of these meetings are significant; the indirect costs to all the participants are enormous; and it is not clear that the benefits balance off the costs. On balance, I would do these twice a year. They may well need to be structured differently, having a flavor of ICANN conferences, rather than ICANN meetings, perhaps with predominant themes (similar to last year's successful security theme at the November meeting). Outreach can also be strengthened by groups of Trustees and staff participating in more regional meetings or holding mini-ICANN briefings and input sessions around the world. It seems perfectly reasonable to specify that a group of ICANN Trustees will hold at least one open session in each geographic region each year, ideally at an existing major Internet meeting or conference. C. Finally, the current panoply of artificial accountability mechanisms should be replaced with a Manager of Public Participation (to ensure effective mechanisms for public awareness and comments on ICANN matters) and an Ombudsman function that is fully staffed and funded to respond to complaints and requests for reconsideration. This function would replace the current reconsideration process and the still to be created Independent Review Panel. There should be a reconsideration process, but I believe that all final decisions must rest with the ICANN Board of Trustees. A reconsideration process is certainly appropriate for staff decisions; after all, in a properly funded and staffed ICANN, the staff will carry out all day-to-day operations, and thus it is appropriate that there be some formal mechanism for those affected by staff actions to ask the Board of Trustees to review those specific actions. In addition, there seems no objection, and some potential benefit, to allow affected parties to ask the Board of Trustees to reconsider a particular Board decision. After all, the reconsideration request can speak directly to the rationale for the action as articulated by the Board of Trustees, and it is certainly possible that a second look may produce a different decision. The Ombudsman process can allow for a fast track process to short circuit any reconsideration requests that are clearly frivolous. Conversely, an Ombudsman could request a stay of further activity relevant to any reconsideration request where there may be merit and continuing activity could cause irreparable or serious harm if the request were upheld. There is no justification, however, and no necessity, for any process that would allow some other body, such as the nascent Independent Review Panel, made up of non-Trustees, to override a Board of Trustees decision. There is no assurance that body would always act appropriately, and thus it is likely we would eventually hear calls to review the IRP decisions in some way. The Board of Trustees will obviously be subject to relevant legal constraints, but apart from that, for ICANN to function effectively there should be a clear and final decisional authority. That should be the Board of Trustees. CONCLUSION For all the reasons described above, if we stay on our current course the ICANN experiment is likely to fail. But properly reformed, I am convinced it can succeed. The ICANN process depends on volunteers to do its work, and those volunteers are driven by a goal - an effective private sector policy development body that coordinates an important global resource. Once it becomes clear that this goal is unattainable, those volunteers will lose their incentive and disappear. Funding is adequate only for the most limited efforts in spite of extraordinary staff dedication, and many important issues are delayed or inadequately pursued. Many have criticized the quality and quantity of ICANN's output (at times with some justification, at times unfairly) but in truth it is a small miracle that there have been no truly major disasters. Much has been accomplished with few resources, but there is much left undone or delayed for lack of people to work on all the problems. There are many difficult and troublesome issues that require attention, in addition to those described above, including data escrow practices, name transfer policies, and new TLD evaluation. These are not getting done adequately or at all, or are being done behind schedule, because there simply are too few human and financial resources trying to accomplish too much. We do not have the resources to enter into the optimal arrangements with root server operators, and to absorb the capital and operating costs of those operations. There could be no At Large elections without outside major funding, because there is no internal funding for that job, and even with external funding there would be a serious drain on ICANN's thinly-stretched staff resources. Many of those with the strongest commitment to a private sector and international approach have become - or give strong indications of becoming - less and less involved as they perceive progress increasingly strangled by the coils of process. As the lack of an achievable and worthwhile goal becomes more apparent, people will simply stop trying, and the ICANN experiment will collapse. There will be no incentive for new sources of energy to emerge, since there will be no point to it. Equally importantly, the governments of the world will conclude (as some may already be thinking) that the private sector effort has failed and thus will seek another, more heavy-handed solution. And the private sector, that depends so much on the stable operation of this critical resource, will swallow hard and accept a completely governmental solution if that is the only solution available to guarantee the stable operation of the Internet. Therefore, those of us who believe in a predominantly private solution must reform ICANN into a true public-private partnership if we want it to succeed. We must do this if we are to succeed in capturing the agility and strength of private sector management with the ability of governments to represent the public interest. This is a real change in the form of the original ICANN concept, but not in the substance of its mission. It is grounded in the reality of our three years of actual experience. The original ICANN was conceived by many as an experiment based on theory and hope; the new, reformed ICANN must be an effective mechanism for global coordination based on practical and workable approaches informed by real life experience. Attached to this report is my suggestion as to how ICANN could be reformed to become a truly effective public-private partnership that can carry out its global coordination responsibilities. I welcome the dialogue that I hope it will generate. M. Stuart Lynn _________________________________________________________________ A PROPOSAL FOR REFORM OF ICANN The following summarizes how ICANN could be reformed to both be an effective global coordination body and meet legitimate goals of transparency and accountability. This outline assumes that the necessary reforms require more of a public-private partnership than was originally envisioned three years ago, that public accountability needs to be assured in a more practical way than in the current structure, and that there needs to be a broader and stronger funding base than exists today. This outline sets forth one approach to solving these problems, and reforming ICANN into a more efficient, more effective entity, while retaining appropriate public input and accountability. It is intended to begin a dialogue within the ICANN community about the changes required if ICANN is ever to accomplish its mission. It is offered with the caveat that we do not have time for an extended debate; ICANN will, in my opinion, either be reformed or irrelevant within the next several months. I. STRUCTURE A. 15 member Board of Trustees 1. Ten At Large Trustees a. Five (one from each ICANN geographic region) nominated by governments (process to be determined) and confirmed by the Board of Trustees b. Five nominated by open nominating process and confirmed by the Board of Trustees (i) Nominating Committee made up of: (a) non-voting Chair, appointed by ICANN CEO after wide consultation; (b) three Trustees whose terms are not expiring; and (c) four other persons selected by the Board of Trustees, after wide consultation. (ii) Nominations process open to all suggestions and inputs, widely publicized, with adequate time to do thorough work. The Nominating Committee is expected to consult with a broad range of the ICANN communities for input to its deliberations. (iii) To assure open communications and substantive input from all major stakeholders, there will be at least the following non-voting liaisons to the Nominating Committee: designees or representatives of IAB, IP address registries, domain name registries and registrars, root name server operators, and the immediately preceding chair of the Nominating Committee. (iv) Nominating Committee makes nominations based on well-defined criteria, clearly stated in advance for each position: outstanding professional accomplishment, technical understanding, record of leadership, reputation for good judgment, record of public service, independence and willingness to commit time and effort; all with due regard for geographic diversity and differentiated experience objectives. (v) When making nominations to a particular Council, the Nominating Committee will consult widely with the most affected stakeholder communities. For example, in making nominations for the Address and Numbering Steering Group, the Nominating Committee will consult with the IAB, RIR Boards and staff, and ISPs. 2. Five Ex Officio Trustees a. CEO b. Chairs (or designees) of Policy Councils (Address and Numbering Policy Council, Generic TLD Names Policy Council, Geographic TLD Names Policy Council) and Technical Advisory Committee 3. Designee of the Internet Architecture Board and Chair of Governmental Advisory Committee serve as non-voting liaisons to Board of Trustees 4. All Trustees (except ex officio) to serve staggered three-year terms; maximum service two terms B. Three Policy Councils and Two Standing Advisory Committees [The Policy Councils would be responsible for discussion about, and development of proposals concerning, issues falling within their area of expertise. Each Council would have a Steering Group, but would be open to and encourage participation by interested stakeholders, directly and through organized Forums (see D below). The Advisory Committees would provide advice to the ICANN Board of Trustees from their particular perspective. The Policy Councils and Advisory Committees would each have dedicated staff and access to the ICANN resources necessary to allow them to function effectively. In addition to publication on the ICANN website, Council recommendations would be circulated to each of the other Policy Councils, the Technical and Governmental Advisory Committees, the Security Committee and the Ombudsman (who would be responsible for soliciting, receiving and organizing public comments related to each such recommendation) for their review and reaction prior to action by the Board of Trustees. Council recommendations would be entitled to great weight before the Board of Trustees, and the Board would be required to explain any decision not to accept the recommendation of a Council, but the Board of Trustees would have the discretion to accept or reject all or any part of a Council recommendation with an appropriate explanation.] 1. Address and Numbering Policy Council a. Open to organizations that utilize ICANN to perform protocol number assignment and/or allocation of IP addresses, and other organizations interested in issues relating to those issues b. Managed by Steering Group of seven members appointed by the Board of Trustees - four ex officio [designee of the IETF Chair and designees of RIRs that have formal agreements with ICANN], and three other persons nominated through NomCom process and confirmed by the Board. Upon recognition of a new RIR, it would be entitled to name an ex officio member of the Steering Group, which will increase in size to accommodate that addition. At any time where the Steering Group consists of an even number of people, the Chair will vote only to break ties. c. Consider funding mechanism for those Council participants (not including IETF) that do not have agreements with ICANN, perhaps tiered to size and ability to pay d. Chair elected by Steering Group, and holds ex officio seat on ICANN Board of Trustees [The ANPC would essentially combine the functions of the current PSO and ASO into a single body, with appropriate staff support and a single Steering Group. The ANPC would have responsibility for advising the Board on the very limited range of policy issues relating to IP address allocation, and any policy or operational issues that areise in connection with ICANN's performance of the IANA protocol numbering functions.] 2. Generic TLD Names Policy Council a. Made up of organizations interested in name policy issues related to gTLDs b. Managed by Steering Group of eleven members appointed by the Board of Trustees - six ex officio [one representative of gTLD registries and one representative of gTLD registrars (each chosen by those respective entities that have agreements with ICANN); one representative of large commercial users, one representative of small commercial users, one representative of non-commercial users, and one representative of individual users (each chosen by those entities in each category that are full participants in the Policy Council or through NomCom process)], and five other persons nominated through NomCom process and confirmed by Board) c. Consider funding mechanism for those Council participants that do not have agreements with ICANN, perhaps tiered to size and ability to pay. Consider whether ex officio user representatives should be chosen from among those participating in ICANN funding. d. Chair elected by Steering Group, and holds ex officio seat on ICANN Board of Trustees [The GNPC would replace the current DNSO, again with appropriate staff and with a Steering Group partly representing stakeholder groups and partially selected by the Board of Trustees.] 3. Geographic TLD Names Policy Council a. Made up of ccTLD organizations and other organizations interested in policy issues related to this topic b. Managed by Steering Group of nine members appointed by the Board of Trustees - five ex officio [one representative of ccTLD registries from each ICANN region, chosen from among those that have existing agreements with ICANN], and four other persons nominated through NomCom process and confirmed by Board c. Consider funding mechanism for those participants that do not have agreements with ICANN, perhaps tiered to recognize size and ability to pay. d. Chair elected by Steering Group, and holds ex officio seat on ICANN Board of Trustees [The ccNPC would be a new entity, intended to provide both policy advice to the Board of Trustees where needed and to serve as a service and policy advisory body to the 243 ccTLDs. It would have appropriate staff support, and a Steering Group made up of both ccTLD representatives and other persons with relevant knowledge or experience that could contribute to these objectives.] 4. Governmental Advisory Committee a. Made up of representatives of national governments, multinational treaty organizations and distinct economies that contribute to ICANN funding b. Funding mechanism tiered to recognize size and ability to pay, but only those contributing to ICANN (plus developing countries whose contribution is waived because of inability to pay) could be full voting participants; non-contributors could have observer status c. Responsible for providing advice to ICANN Board concerning issues of governmental concern; input provided by Chair's participation on ICANN Board of Trustees, and by Annual Report of GAC to ICANN Board setting forth areas or issues that GAC suggests require priority attention by ICANN d. Chair elected by voting members, and holds ex officio seat on ICANN Board of Trustees [The GAC should continue to be a forum for governments to discuss DNS policy issues, but should have appropriate staff support, and full membership should require a funding contribution per some tiered schedule (requiring little or no contribution from less developed nations). The GAC Chair would serve as an ex officio liaison to the ICANN Board of Trustees.] 5. Technical Advisory Committee a. Made up of individuals with direct experience with or responsibility for technical issues relating to ICANN's activities b. Committee would consist of seven members, four ex officio [one designee of IAB, one designee of RIRs, one designee of root name server operators and one designee from among the domain name registries/registrars] and three other persons selected through the NomCom process (which could be drawn from representatives of various other groups, such ETSI, ITU, W3C, etc). c. The TAC will advise the ICANN Board and staff on technical and operational issues relating to ICANN's activities. Unlike the Policy Councils, the TAC's role will be purely advisory, without the obligation to develop global policies. It will offer technical and operational advice when asked, but will not be expected to undertake independent policy development on its own initiative. d. Chair elected by Committee, and holds ex officio seat on ICANN Board of Trustees [The TAC will advise the ICANN Board and staff on the technical aspects of ICANN's operational responsibilities. For example, the TAC would be the body to provide advice on testing the use of shared addresses for the root name servers, or for testing the ability to deploy internationalized TLDs in the root zone file.] C. Security Committee 1. Made up of no more than 20 persons appointed by the Board of Trustees with appropriate background experience and expertise, including an ex officio participant from the GAC 2. Initial Chair appointed by Board; subsequent Chairs elected by members 3. Responsible for coordinating ICANN activities related to all aspects of security of the Internet's naming, numbering, and address allocation systems D. Root Name Server Operations Committee 1. Continuation of current Root Server System Advisory Committee, consisting of each root name server operator plus experts invited by the Committee 2. Chair appointed by Board of Trustees. Chair (or his/her designee) sits ex officio on the Technical Advisory Committee and Security Committee. 3. Responsible for coordinating ICANN activities related to the operation, functioning, and evolution of the DNS root name server system. E. Forums [In order to help generate participation, facilitate meaningful deliberation, and structure input, I propose a reformulation of the existing constituency concept. The currently existing DNSO constituencies would be invited to continue as self-organized, cross-Council Forums within ICANN. The Forums could then participate in each of the Councils, offering input, developing and evaluating proposals, and advocating on behalf of their members, as they see fit. For example, the ISP Forum would be a channel for its members to formulate and give input about gTLD, ccTLD, and addressing policy issues, and would be a venue for input to the Nominating Committee. The Forums would be expected to re-orient away from debates over procedure and toward deliberations on substantive DNS policy matters. As it currently the case, some Forums would by definition be limited to members defined by the existence of a contractual relationship with ICANN (e.g., the gTLD registries, ccTLD registries, and gTLD registrars), while others would be more open and defined by function (e.g., the ISPs, business, non-commercial, and intellectual property constituencies). New Forums could be created as well. For example, an At Large organization based on regional entities, as proposed by the At Large Study Committee, could be organized for individuals. By eliminating the current concept of mathematically equal representation for each constituency on the DNSO Names Council, ICANN could more readily develop and implement well-defined minimal criteria for recognition of new self-organized Forums (for example, we might imagine Forums for universities and academic networks, individuals, small business users, backbone providers, etc.) without encountering resistance from existing Forums due to a feared dilution of influence. This would significantly reduce the barriers to participation in policy discussions and deliberations by groups with common interests and objectives.] II. FUNDING [This structure is designed to broaden and regularize the ICANN funding structure. It differentiates between core funding - funding for those tasks that are integral to the ICANN mission and benefit the global Internet user community generally - and fee-based funding - reimbursement for the fully allocated costs of providing various services to entities that do not participate in the core funding process. Funding could be bundled into agreements (so that entities with which ICANN had an agreement would pay a single annual amount to cover both core funding support and all service requirements) or could be collected in various ways from entities that do not have agreements with ICANN. For example, since it would conflict with ICANN's mission to refuse IANA or other necessary services, those ccTLDs that choose not to enter into agreements with ICANN should pay a service fee for IANA and any other services they utilize that includes an allocation for overhead and a share of the core funding requirements. In addition, consideration should be given to creating some form of participation fee for those entities that do not have agreements with ICANN but do fully participate in the policy development process by those entities (e.g., large commercial users, etc.).] A. Funding Requirements: Funding requirements are divided into two parts 1. Core Funding Requirements: covers "public good" costs, including funding the root name server operators on a contracted basis, and all associated overhead costs. This includes funding for * Management and Administration * Office of the Ombudsman * Outreach and Public Information * Support for Board of Trustees * Staff support for Board, Policy Councils and Standing Committees * Policy Development * Planning * Conferences * Funding for Root Name Server Operators 2. Service Funding Requirements: includes funding for IANA services, gTLD licensing, contract monitoring, compliance; derived from fees for services B. Recovery 1. Core Funding is recovered from all entities with which ICANN has agreements (registries and registrars), from governments (see section on GAC), and possibly from others that participate in Policy Councils (except the IETF). Core funding costs are allocated according to some appropriate metric, such as GDP for participating governments and revenues for other entities a. Funding is tiered (similar to current mode of allocating fair shares to ccTLDs) 2. Service Fee Funding is recovered through charging fees for services. These may either be bundled (into agreements for those with agreements with ICANN) or unbundled (i.e., charged on a fee for service basis). 3. Budget is developed by President/CEO with input from Policy Councils and Advisory Committees, and approval by Board of Trustees. C. Summary of Principles 1. Bundled Fees a. Services to entities with whom ICANN has a signed agreement should be bundled into the agreement; i.e., funding commitments under agreements would include all ICANN services 2. Unbundled Fees a. Fee schedules would be created for all services offered to those entities that do not have agreements with ICANN that cover the costs associated with delivery of those services, including an appropriate share of overhead allocation. 3. Tiering Concept a. Where feasible, tiering concepts should be used in establishing core funding levels, service fees, etc (similar to what is currently used for ccTLDs). An appropriate metric for proportionality should be used. b. Services to TLDs in the lowest layer should be free to the extent practicable 4. Pass-Through Funding a. ICANN's practice should be to contract out for services where this makes sense, such as for root name server operations. 5. Protocol Numbering Services a. No fees will be charged to the IETF for the IANA protocol numbering functions. D. Levels of Funding [The following estimates are based on broad assumptions about efficient and effective operation. While they rest to some extent on experience, the only certainty from that is that the current funding structure is woefully inadequate to provide for the services and other responsibilities contemplated for ICANN. Thus, these estimates should be considered to be order of magnitude, not precise estimates.] 1. "Public Good" and Overhead (~US$8-10 million) 2. Funding of Root Name Server Operations At Current Levels (~US$10 million) 3. Funding to Support IANA services and other service functions (~US$2-3 million) 4. Funding for establishment of reserves, built up over three years (~ US$10 million) III. TRANSPARENCY AND PROCESS A. Ombudsman 1. Person of unassailable credentials appointed by Board of Trustees 2. Responsible for receiving and processing complaints, requests for reconsideration or objections to ICANN staff action, and to bring any recommendations directly to the Board. Able to solicit all necessary information and data needed to evaluate and make recommendations relating to any complaints, disputes, and requests for reconsideration. 3. Provided with support staff and other resources necessary to carry out responsibilities effectively 4. Direct access to the Board to communicate findings and recommendations when required; authority to post reports on ICANN website as appropriate. B. Manager of Public Participation 1. Would collect and report to the Board and the community on any public comments or complaints received dealing with matters put out for public comment or actions taken by the Board of Trustees, staff or subsidiary bodies. 2. Responsible for managing all ICANN public forums, public e-mail lists, etc. Provided necessary electronic access to publicize findings and recommendations, all of which will be available to the public 3. Provided with support staff and other resources necessary to carry out responsibilities effectively C. Continued Obligation to Be Transparent with Respect to all Actions and Decisions 1. Notice and comment obligations for all Board decisions, proposed policy advice and other actions by Policy Steering Committees, and other relevant events 2. Requirement for prompt posting of minutes of all meetings of Board and Steering Groups ______________________________________________________________________ ------------------------------------------------------------------------- POLITECH -- Declan McCullagh's politics and technology mailing list You may redistribute this message freely if you include this notice. 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