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Verisign, Altanovo, and ICANN Clash Over .web Domain

The .Web Domain Saga: Unraveling the ICANN, Verisign, and Altanovo Dispute

Laptop, Coffee, and .web Concept

The battle for control of the .web top-level domain (TLD) continues to escalate, with newly published letters revealing deeper tensions between the key players. This complex dispute, involving the Internet Corporation for Assigned Names and Numbers (ICANN), Verisign (NASDAQ: VRSN), and Altanovo Domains, has far-reaching implications for the future of the internet and domain name governance.

Background: The $135 Million Auction and Subsequent Controversy

The story begins with an auction where Nu Dot Co secured the rights to operate the .web TLD for a staggering $135 million. However, prior to the auction, Nu Dot Co entered into an agreement with Verisign, the well-established registry operator behind .com and .net. This agreement stipulated that Verisign would finance Nu Dot Co’s auction bid, and in return, Nu Dot Co would assign the .web domain to Verisign after winning the auction.

Afilias, now known as Altanovo Domains, was the runner-up bidder and immediately raised concerns about the legality and ethical implications of the Nu Dot Co-Verisign deal. Altanovo argued that the pre-arranged agreement violated ICANN’s rules governing new TLD auctions and created an unfair advantage for Verisign. This led Altanovo to file for an Independent Review Process (IRP) to challenge ICANN’s handling of the situation.

The IRP panel ultimately decided to refer the issue back to ICANN, tasking the organization with determining whether the Nu Dot Co-Verisign deal was indeed in violation of the established rules. This decision placed ICANN in a difficult position, requiring it to carefully weigh the arguments from all sides and consider the potential consequences of its ruling.

ICANN’s Deliberations and the Exchange of Letters

Currently, the matter rests with ICANN, which is tasked with determining whether the agreement between Nu Dot Co and Verisign adhered to the relevant regulations. At a January meeting, the ICANN Board passed a resolution to gather additional information and data to inform its decision-making process. This resolution signaled ICANN’s intent to conduct a thorough and impartial review of the situation.

However, the process has been far from smooth. On February 11th, Altanovo Domains submitted a letter to ICANN and its board expressing concerns about the wording and rationale behind the resolution. Altanovo felt that the resolution did not adequately address the core issues raised in its original complaint and that it potentially favored Verisign’s position.

A week later, on February 18th, Altanovo sent a second letter further criticizing language related to .web in a Verisign SEC filing. Altanovo argued that Verisign’s public statements regarding its expectations for .web suggested a degree of certainty that was inappropriate given the ongoing review process.

This prompted a response from ICANN’s outside counsel, Jones Day, who sent a letter (which was not published) to Altanovo’s counsel alleging a violation of Rule 4.2 of the Model Rules for Professional Conduct. Jones Day argued that Altanovo was improperly communicating directly with ICANN rather than through its legal representatives. Altanovo’s counsel responded, stating that they had resorted to directly contacting ICANN due to a lack of response from Jones Day to earlier correspondence. The back and forth highlights the level of animosity and mistrust between the parties involved.

Adding another layer of complexity, counsel for Nu Dot Co and Verisign also sent a letter, accusing Altanovo of attempting to influence the community and the ICANN board through its public letters. They demanded that the letters be withheld from publication, citing concerns about the disclosure of confidential information. However, Jones Day responded with a letter disputing Altanovo’s claims and stating that it would publish the letters with necessary redactions to protect confidential information. This exchange underscores the high stakes and the intense scrutiny surrounding the .web domain dispute.

Analyzing the Arguments: A Playground Spat with High-Stakes Consequences

The series of letters paint a picture of a contentious dispute, characterized by carefully chosen words and accusations from all sides. It resembles, in many ways, a playground argument, albeit one with significant legal and financial implications.

Altanovo, for example, pointed to statements made by Verisign’s CEO and Chairman, Jim Bidzos, during an earnings call. In its first letter, Altanovo quoted Bidzos as saying:

“With the rejection of Afilias’ application and the reaffirmation of the panel’s final decision, those roadblocks are now out of the way, and ICANN looks to be moving forward with making the decision on the delegation of .web, and we will be monitoring their process. As we have said before, we continue to look forward to becoming the .web registry operator and establishing [it] alongside .com and .net as an additional operation for businesses and individual end users worldwide.”

Altanovo argued that these comments suggested that Verisign had inside information about ICANN’s decision-making process and that it was unfairly positioned to influence the outcome. They further noted that while Verisign was able to “monitor” ICANN’s process, Altanovo was not privy to the same level of information.

However, Verisign countered that its monitoring was based solely on publicly available information, and that analysts could monitor the situation in the same way. This highlights the selective use of information and the attempts by all parties to frame the narrative in their favor.

The Uncertain Future of .Web: A Long and Winding Road Ahead

Regardless of who is ultimately correct, one thing is clear: the .web domain is unlikely to be available to the public anytime soon. The legal challenges and regulatory hurdles are significant, and the animosity between the parties involved suggests a protracted battle.

If ICANN ultimately decides to allocate the .web domain to Nu Dot Co (and, by extension, Verisign), Altanovo has threatened to pursue further legal action. This could involve appeals to higher courts and potentially even international arbitration. The legal process could take years to resolve, further delaying the availability of .web to potential registrants.

The .web domain saga is a complex and multifaceted dispute that raises important questions about domain name governance, competition, and the role of ICANN. The outcome of this case will have a significant impact on the future of the internet and the way domain names are managed.

Key Takeaways from the .Web Domain Dispute:

  • The .web domain dispute involves ICANN, Verisign, and Altanovo Domains.
  • The core issue is whether Verisign’s pre-auction agreement with Nu Dot Co violated ICANN’s rules.
  • Altanovo has raised concerns about Verisign’s influence and ICANN’s handling of the situation.
  • The dispute has led to a series of legal challenges and public statements from all parties.
  • The future of .web remains uncertain, with the potential for further legal action and delays.
  • The case highlights the complexities of domain name governance and the importance of fair competition.
  • ICANN’s decision will have a significant impact on the future of the internet.

The ongoing .web domain dispute serves as a reminder of the high stakes involved in the domain name industry and the need for transparency and accountability in domain name governance. As the case continues to unfold, it will be crucial for ICANN to carefully consider all perspectives and make a decision that is in the best interests of the internet community as a whole.