More Nonprofits Pushing for Delay, Halt to .Org Sale

ICANN should delay the sale of the Public Interest Registry to a private equity firm until concerns about possible censorship, high domain name prices and other issues are addressed, more nonprofits are asking. The transaction, announced Nov. 13 (see 1911130029), involves the sale of PIR's assets to Ethos Capital. Despite assurances from the buyer and the seller, the Internet Society, opposition is growing. ICANN requested more information about the deal and urged the parties to act openly and transparently.

ICANN's Noncommercial Stakeholders Group is preparing a letter to board members that "emphasizes the obligations inherent in the original award of ORG to PIR," Internet Governance Project founder Milton Mueller emailed Monday. The draft says how ICANN handles this case "will have enormous precedential consequences" for the domain name system's "stability" and ICANN's reputation and status. ICANN should "step up and meet its clear obligations" to ensure that .org continues to fulfill the conditions of its delegation.

Ethos will pay $1.135 billion for .org, which ISOC said it will invest as an endowment, with earnings used to fund its work on "expanding the reach of the Internet, and making it stronger," CEO Andrew Sullivan blogged. The announcement prompted creation of a SaveDotOrg petition to halt the sale. In response, ISOC launched a blog to answer questions about the transaction and future pricing for .org domains. ISOC said Ethos and PIR agreed to keep .org accessible and reasonably priced for nonprofit organizations, and to make the domain space "an even more reliable and useful home" for them. The transaction is expected to close early next year, ISOC Chair Gonzalo Camarillo blogged.

The ISOC and PIR boards strongly support the transaction, an Ethos Capital spokesperson emailed Tuesday. Giving the registry long-term financial security and more diversified funding will support ISOC's vision and mission, and PIR will have a "terrific new platform" to grow on. The sale announcement prompted concerns, but others have voiced appreciation for the opportunity presented, the spokesperson noted.

"Ethos has already made clear its commitment to investing in the long-term vitality" of the registry and its users, the spokesperson said. He said as Ethos CEO Erik Brooks "has made clear, the mission and purpose by which PIR was established is not going to change."

Brooks said the company's values are broader and more expansive than traditional investing and that PIR's mission "is exactly in line with our values. That will not change at all." Ethos will invest in the registry's long-term success, he said according to the transcript of a Dec. 5 Nonprofit Technology Enterprise Network call. Annual domain name price rises will average no more than 10 percent, he said.

The proposal got immediate backlash from the nonprofit community. Organizations on different sides of some tech and telecom regulatory issues urged ISOC to stop the sale. Under PIR's new agreement with ICANN, the registry has several new powers that could allow it to raise .org registration fees without approval of ICANN or the .org community, said Consumer Reports, Communications Workers of America, Greenpeace, Public Citizen, R Street and others. They worry rights protection mechanisms could be put into place unilaterally; and processes installed to suspend domain names based on accusations of "activity contrary to applicable law." These powers, the letter said, could harm the global nongovernmental organization sector and shouldn't be placed in the hands of a private equity company that hasn't earned NGOs' trust.

One key issue is possible censorship, the Electronic Frontier Foundation said. Registries have power to suspend domain names, disrupting all internet resources using that name including websites, email addresses and apps. That power lets registries exert influence over online speech, the group said. It, too, signed the letter.

EFF seeks a "process to guarantee the rights of nonprofit internet users." That process could take several forms and should have been done before ISOC agreed to the sale, emailed Senior Staff Attorney Mitch Stoltz. No one knows much about Ethos investors or their goals, and "it doesn't make sense for a private equity firm to be satisfied with the same returns on capital that a nonprofit would be." Mozilla said the sale should be delayed until there are answers to questions such as whether new stewardship measures proposed for the new PIR are sufficient to protect .org users.

Under the .org registry agreement, ICANN has 30 days from Nov. 13 to seek additional information about the sale, CEO Goran Marby and Board Chair Maarten Botterman blogged Tuesday. They asked the parties to clarify the continuity of registry operations, the nature of the proposed transaction, how the proposed new ownership structure would comply with the terms of the current registry agreement, and how the parties intend to keep their promises to serve the .org community. ICANN "will thoroughly evaluate the response" and then has another 30 days to give or withhold consent.