Recorded Webinar: Insights from ICANN 58, Copenhagen

From Denmark's City of Spires: "Insights from ICANN 58, Copenhagen". Corporation Service Company® (CSC®) Director of Policy and Industry Affairs Gretchen Olive returns from ICANN 58 in Copenhagen, Denmark to report on the latest domain name and brand protection developments, including the latest news concerning the New gTLD Program, the IANA Functions Stewardship Transition, and other topics of critical interest to brand owners everywhere.

Ms. Olive—an internationally recognized expert on ICANN’s New gTLD Program—will address best practices in effective global domain name, trademark, and brand protection strategies, with a focus on new gTLDs.

View the recorded webinar here.

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Webinar Transcript*

Anu: Hello, everyone, and welcome to today's webinar from Denmark's City of Spires, "Insights from ICANN 58 Copenhagen." My name is Anu Shah, and I will be your moderator.

Joining us today are Gretchen Olive and Ben Anderson. Gretchen is Director of Policy and Industry Affairs at CSC Digital Brand Services. For over 16 years, she has helped Global 2000 companies devise global domain names, trademarks, and brand protection strategies. Gretchen is an internationally recognized expert on intellectual property protection and a leading authority on the ICANN New gTLD Program.

Ben is Head of New gTLD Services at CSC, and is responsible for overseeing the development of the company's product portfolio and proposition. He is an active member of the industry on the topic of gTLDs and currently sits on the board of various domain and compliance bodies for ICANN and INTA, regularly providing expertise, guidance, and advice on any development. With that, let's welcome Gretchen and Ben.

Gretchen: Great. Thanks, Anu and welcome, everybody. Really appreciate you taking the time out of what I know is always a busy day to join us here today. I'm very excited that today you get both myself and Ben Anderson. For those of you who may not be aware, last August, CSC acquired NetNames, and Ben was an employee there at NetNames, someone who really was my counterpart over there at NetNames. So now, you get two for the price of one.

You have both Ben and I on these webinars, and Ben brings with him, as Anu already said, just a wealth of industry experience. I think combined, he and I have close to 40 years of domain experience, which is pretty sad, and I think starts aging us a bit. But we're really excited to be able to join forces and share our insights with you. So as always, an ICANN Meeting is a very busy week. This was no exception. So we have quite an aggressive agenda here today, but we'll hop right into it.

So as many of you who've joined us before know that I always like to start these webinars making sure everyone understands who ICANN is. I do see, as always, a few new names on the list. So I'm very excited that you've chosen to join us today. But let's just first start out and make sure everybody understands who ICANN is. ICANN is the Internet Corporation for Assigned Names and Numbers, and it's the group that governs the domain name space. One of the things that makes ICANN a very unique organization is it's based on a consensus, multi-stakeholder model.

So what does that mouthful mean? Well, that means that there are a lot of different stakeholders who come to the table to work through and develop policy that governs the domain name space. That policy comes from the bottom up, through these different stakeholder organizations, and ultimately makes it to the Board, where we receive advice from different advisory committees. So let's talk about who some of these advisory committees are and who some of these stakeholders are represented in the different bubbles in this diagram.

So you'll see on the left-hand side, a bright orange bubble on the top. That's the president, CEO, and ICANN staff. So that's the group that kind of runs the day to day functions of ICANN. Then, you'll see a bunch of colored bubbles, and those are really stakeholder organizations. The one we talk most about in these webinars is the green bubble, the GNSO, which is the Generic Names Supporting Organization. That stakeholder group is made up of a lot of different folks who are kind of key to making the Domain Name System work. They have registries, registrars, the business constituency, IP constituency, ISPs.

These are all people who are very, very active in the generic space, whether as consumers of domain names or operators of some nature of domain names in the generic name space. Then, you also have the grayish bubble to the right, and at the very top you'll see one that says "GAC," G-A-C. That's the Governmental Advisory Committee. Now, that committee is made up of a number of government representatives, typically from their telecom ministry or agency, and their purpose is to provide advice to the ICANN Board.

When these different policies start coming up through the consensus policy process, they're there to kind of give that public policy perspective from that of sovereign entities, sovereign countries. So that they're able to kind of give the ICANN organizations, ICANN community, insight into what may be problematic in their countries. So it's a group of people with very divergent interests. It is a growing group. ICANN Meetings 10 years ago, you might see about 1,000 people there.

I know when I started to go, [inaudible 00:05:21] and I guess my first ICANN Meeting was somewhere around 2000, there were only a couple hundred people who went to ICANN Meetings. But now, it's typically in the thousands. It's usually 2,000-plus who make it to an ICANN Meeting, again, representing different interests around the whole domain name space. So with all that kind of housekeeping out of the way, let's talk a little bit about what's going on at ICANN, the organization.

So for those of you who've joined this webinar series in the past, you know that we've had a recent change in the president and CEO. It used to be Fadi Chehade, and just about a year ago there was a change to Goran Marby. Goran comes to ICANN with more than 20 years of experience in internet and technology sectors, and most recently was working for a government entity, the Swedish Post and Telecom Authority. So he's got both sort of that private/public sector perspective to technology and the internet. So I think that's a very positive development for ICANN.

And you're just starting to see, I would say this meeting was the first time over the last 9, 10 months, where I think you're starting to finally see kind of his vision, his fingerprint starting to show on how ICANN operates. It definitely appears that one of his very early priorities is increasing transparency at ICANN. I was talking earlier, I think one of these times when I go to an ICANN Meeting, I'm going to keep track of how many times the word "transparency" is mentioned because it is a major buzz word at an ICANN Meeting. However, I think he thinks of transparency perhaps more broadly than the ICANN community has in the past.

I think he really wants to kind of peel away the curtain from what happens at ICANN, the organization, meaning what happens behind the doors of the ICANN staff, and sort of demystifies it. Because I think what happens is with sort of the mystery and the intrigue sometimes of how things happen, why they happen, it just sort of escalates to conspiracy theories and all sorts of other things. So I think he's very interested in kind of reducing maybe some of the drama, and hopefully the functioning of ICANN and how the public can both receive information from ICANN and provide information to ICANN.

So one of the examples of that is, he just actually announced the appointment and creation of a new officer post at ICANN. It's an ICANN Complaints Officer post. I think when most people heard this, they were thinking, "Well, there's already an ombudsman at ICANN. Why do you need a complaints officer?" But I think he, in sort of describing it, it seems like there's still some details to work out.

But I think they're really hoping that this complaints officer can kind of work on maybe complaints about systemic things that happen at ICANN, how processes work, how decisions get made, and less about what those decisions are and why people disagree. I think that's oftentimes what the ombudsman is working through, I think this complaints officer post will be a slightly different flavor, but a complementary flavor. So yet to be seen, again, just recently announced and something we'll watch closely. Because I think, certainly, increased transparency is a good thing.

Now, with that, we are in the time of year where we talk about the ICANN budget. ICANN's budget year runs from July 1 to June 30. Typically, the budget, it certainly takes up a certain amount of air in the Spring ICANN Meeting. But I've noticed that over the last couple of years, particularly, it's taking up more and more air. I think that's because ICANN's budget keeps on getting bigger and bigger. So it certainly stands to reason why more and more people are interested about what ICANN is doing with the money that comes into the organization. Because at the end of the day, it is a nonprofit organization.

But however, it's also a nonprofit organization that has grown substantially over the last six to eight years. I can remember an ICANN, where there were just a little over 100 employees. We're now in the 400s. So that is an exponential change, largely driven by the new gTLD program. Definitely, it seems to be a convergence between that expansion and the rollout of the New gTLD Program. But here, you can see kind of how the process is going to kind of unfold. Now, they've posted the FY18 budget. They call it the "FY18 Operating Plan and Budget," and it's now open for public comment until late April. So definitely, if you want to check it out, go to the ICANN website. In the Public Comment forum, you will see lots of information about the budget.

But one of the things I think that I'm seeing is very different this year is there are some substantial concerns about the ICANN budget. Not that there haven't been concerns in the past. But let's just say the voices are growing and they're getting louder, and they're more present across the stakeholder groups. Really, the key budget concerns that I heard and I know, Ben, we've talked about this, you heard, included the fact that ICANN's reserve funds will be less than 50% of 12 months of operating expenses, which is a best practice and something that ICANN has been able to achieve previously.

So to see this and suddenly see this huge drop in the reserve funds, it's given folks some concern, some pause. Now, ICANN finance staff were quick to point out that last year and even into the year before that, there was a substantial amount of expense incurred by the organization as a result of the IANA transition, basically, the full pullout, or full release, of ICANN oversight by the U.S. government. So now, ICANN is truly that international, multi-stakeholder organization, where it's not kind of being controlled or having oversight control by any one government.

So I think many people see that as a very positive development. But that came at a cost, and there are pretty significant costs that ICANN is basically saying is a big reason for the depletion of the reserve funds. Now, I think if that were the only thing in the budget that gave people concern, maybe the voices wouldn't be so loud. But I think there's a couple of other things that are kind of compounding things. One is, I think, the projected revenue from new gTLD registrations. I think people feel that ICANN's projections might be high.

So they're worried that they're projecting certain revenues to come in from the registration of domain names because there's fees that registries and registrars pay for every registration to ICANN. So some are concerned, "All right. They have this depletion of the reserve funds. Their projected revenue might not be as strong or they may need to dip into that reserve fund." Then, you also have the substantial staff growth and concern about the sustainability of that staff growth.

When you look at the staff, and you go and kind of really drill into the org charts, you'll notice there's a lot of VPs, a lot of deputy directors, that type of thing. So these are not kind of low-level staff. These are very highly-paid, senior staff. So I think there's some concern. There's also a huge backlog of projects the community really wants ICANN to dig into and to undertake, in addition to things that ICANN as an organization needs to do to improve security, improve efficiency, things like that.

Those types of projects, as we all know in global organizations, are costly. They take time. They take resources. They take money. So for all these reasons, I think there's, I would say, more concern than usual over the ICANN budget. So if you want to dig into it, like I mentioned, we give you the link here. But this budget thing, I think you'll see how this kind of plays into a few other things as we move through this presentation, how this is kind of looming in the back.

So the other thing that certainly gets a fair amount of air at ICANN Meetings is Governmental Advisory Committee. We talked a little bit about who they are at the top of the session. We learned at this ICANN Meeting that the chair who had just started his second term, actually, he's going to need to resign. His boss is retiring. He's with the Swiss government, and he's going to be assuming his post. So he needs to kind of release his GAC duties to focus on becoming the Vice Director of the Federal Office of Communications for the Swiss government.

So there'll be a new chair. He'll stay on as the new chair's elective at ICANN 60 late this year, but that's going to be a change and the GAC has a growing voice in the ICANN community. They're getting involved earlier in providing commentary and guidance, and quite honestly, opinions about things that are just at the lower kind of level of policy development. They're not waiting until they get to the Board. They're kind of learning and providing inputs earlier. So this GAC chair position is a very important position and a very visible position within the ICANN community. So it'll be interesting to see who takes that position later this year.

As just some background to give you a sense of sort of how big the GAC is, currently GAC membership is at 171 member countries with 35 observers. Typically, about a third of all those members attend an ICANN Meeting, so this time it was 59 members and 9 observers. The GAC is always trying to get other countries to dedicate resources and time to being part of the GAC, so they can be more representative of kind of these global public interest concerns. In fact, this time, this meeting, they announced that Zimbabwe was a new member, so a growing body, a growing voice.

They always have some concerns, and the way they usually voice their concerns to the ICANN Board is through something called "GAC Advice." That usually comes in the form of what's called a "communique" that's issued at the end of the ICANN Meeting. But before we get to the communique, maybe let's just go through some of the things that are really pressing on their minds and were kind of topics of substantial discussion for the GAC at ICANN 58. Definitely, top of the list, Ben, would you say, was two-character country codes at the second level?

Ben: Definitely. Yeah. I mean, this has caused a great deal of debate and has been ongoing for quite some time. So for those of you that operate a dotBrand or use two-character domains to the left of the dot, you'll know how important they are and how memorable they are. Now, many governments feel that two-character codes to the left of the dot are sovereign property. So Italy has "it," and Malaysia had "my," the U.S. has ".us," and so on, and these can be seen as quite valuable domain names.

Previously, there were mechanisms in place that prevented new gTLD registry operators from offering these domains on the open market. There was a great deal of debate about this subject, and the ICANN Board and the Global Domains Division then allowed registry operators to release these for either use or sale, or they could reserve themselves. Now, many registry operators have seen two-character domains as something that should be sold at a premium, and they have been offered at a very high premium.

So while this has started to happen, this has raised eyebrows in the GAC and [inaudible 00:18:57] because they issued advice that said, "ICANN should not allow for these to be released now." One part of ICANN thought that they were okay to do so. As that has happened, the GAC have now raised this again and said that it's an important subject for them. Really, what does this matter for our customers or for those that register domains? Well, it means that these two-character domains may be prohibited from sale in the future if ICANN decides to take action on this GAC advice.

So registries are now trying to offer these domains at a lower premium than they previously wanted. So if you think there are two-character domains and new gTLDs that could be important to your brand, maybe your brand operates under the banner of two characters, then now is the time to start thinking about whether or not you should secure them. Because I don't think this issue is going to go away and, as I said, some countries see these as sovereign property and therefore will argue for quite a while about having their sale banned.

Gretchen: This has been such a saga throughout the new gTLD program. So I think many of us at the last ICANN Meeting, when the Board did resolve that they could be released, all of us kind of knew that this was coming back. So definitely, it was a self-fulfilling prophecy, I think. So very, very interesting there. Related to kind of these country codes at the second level, the GAC has been quite vocal about protecting names at the second level related to Red Cross/Red Crescent. The Red Cross is a very special organization internationally.

There has been some temporary protections put in place, after pretty substantial kind of fighting and foot-stomping during the first round. There has been continued debate about whether or not that should continue. The GNSO, which is one of the colored bubbles we talked about earlier, and the GAC have kind of been on opposite sides of the fence on that one. But they did have a very successful kind of, I'll call it, "informal mediation," if you will, from a former ICANN Board member, Bruce Tonkin. Kind of worked with the two sides to get them talking and get them to understand kind of each side's position.

It sounds like, through what we saw at the ICANN Board meeting and the resolution around these Red Cross/Red Crescent protections, it looks like they've come to an understanding and an agreement for a more permanent solution, which will be great. Not to be forgotten in that kind of same vein is just generally NGO, IGO names. The GAC feels really strongly about they should be afforded special protections and not be released. That has also been a substantial kind of issue. Three-character names are very valuable domain names.

Lots of organizations, I look at our own organization, CSC, we're a three-character company name. There could be many CSCs around the world, many companies or organizations that have those acronyms. But certainly, the GAC feels that NGOs, IGOs should be afforded special protection in the public interest. So they've continued to argue for those and continue to provide advice to ICANN saying that they should afford those special protections. So I think those will be for future discussion, maybe potential, more informal mediation, but certainly a hot topic.

Probably, also worthwhile talking about is the dot web auction issue. So Ben, I know that you've been following that really closely. Maybe you can give our participants here a sense of what's going on there.

Ben: Sure. Yeah. Thanks, Gretchen. I kind of feel like dot web needs its own soap opera because this has been something that's been going on for quite some time. Dot web was, in a lot of people's estimations, the only true competitor to dot com when coming to apply for a new TLD in the previous round. So it's really seen as a volatile name space, and one that could resonate with internet users, especially those that were looking to register their own name. So as you might expect, quite a lot of people applied for dot web in the previous application round, and the usual suspects were in there and applying. I think overall, there were about nine applicants in the end.

What happened with the new gTLD contention set? So when there was more than one applicant, ICANN encouraged those applicants to resolve that contention themselves, and that usually happened through a third-party auction. There were various different formats of auction. But ultimately, ICANN wanted the applicants to resolve the issue themselves.

If they couldn't resolve the issue, however, then all the applicants would be taken to an ICANN "last resort" auction, and that's where ICANN would force all the participants into a closed auction process, where they would all put in the amount, they would bid the amount that they wanted for the TLD, and in the end ICANN would resolve the issue through that auction.

Now, there was one prevailing bidder, and they applied for dot web. They were the Columbian outfit that ran dot co. Some of you may remember when that was released sometime back. All in all, that seemed okay. However, just after they won the auction, the rights to that TLD and to the application were then assigned to Verisign, the company that runs dot com and dot net. Many of the other applicants that were involved in the auction process felt that that was a breach of the rules in the Applicant Guidebook, as well as various other things within the auction process itself, so felt that Verisign had essentially applied for dot web and bid for it through a proxy.

So what has now happened is that other applicants have taken a dim view to this and have launched legal proceedings against Verisign and ICANN. So the TLD that we thought may indeed be the one that captured the imagination of the general internet users and may come out this year, following the end of the auction, I don't think we're going to see this year. Because this legal process is now ongoing between some of the applicants and Verisign, and I'm not sure how this is going to play out and whether or not Verisign will end up keeping the TLD. That will be for the courts to decide, but I don't think we've seen the end of the dot web drama.

Gretchen: No. I agree. I think, as you said, it's a soap opera that we probably could not have imagined at the beginning of this whole process. Now, those were the issues, the key discussion items for the GAC. As you can imagine, in their communique, which I mentioned earlier, that came out at the end of the meeting, they really focused on four of those topics. So again, provided advice around Red Cross/Red Crescent, which again, I think we're to the final solution on that one. But continue to talk about the IGO protections, mitigation of domain abuse.

The GAC feels pretty strongly and they have throughout the new gTLD process that there should be a lot of protections built into these TLDs that relate to what they call "sensitive strings," which are strings that relate to highly regulated industries or to vulnerable populations, or to kind of different professional-type industries. So they have felt very much that ICANN has not done enough in this area. They've pushed, pushed, pushed, throughout the Round 1 rollout. They continue to believe that ICANN has not done enough, and they're demanding some proof that they've done enough.

While they're doing that, they're also working as part of some of the discussion that's going around of potential Round 2, and saying that this absolutely needs to be baked into Round 2 policies, procedures, rules, is greater protections around these types of strings. Then, you have the two-character country territory code issue. So if anything, the GAC is very consistent. We can usually count on them to take up those issues. So this brings us to another quite kind of regulatory matter, is the General Data Protection Regulation.

So on this session, we have largely a U.S. audience. But I'm sure many of you are aware of the General Data Protection Regulation by which the European Parliament, the European Council, and the European Commission are trying to basically unify and strengthen these data protection measures that are in place through national law and other laws in Europe. The goal really being protecting personal data, and also simplifying this regulatory environment so that international business can sort of have a little bit more predictability, a little bit more of a global policy. The GDPR will take effect next year in May, after a two-year transition period.

But believe it or not, it really hasn't been something that's been discussed widely in the ICANN forum. Given the fact that WHOIS is probably one of the most talked about issues in the history of ICANN and everything that is going on currently around WHOIS, that's kind of surprising. In fact, many registries and registrars have been asking, "What is going to happen around WHOIS, as it relates to this GDPR?" Because ICANN's policy, in terms of public WHOIS, seems to be in direct contravention of this law and has been in contravention of a lot of the national data protection laws.

So they had some of the folks from the Council of Data Protection Commissioners and others come to ICANN and basically engage in dialogue and discussion with the GAC, with members of the ICANN community. It proved to be, I think, very eye-opening. I know Ben and I walked away going, "Wow. There's a lot to do here, and very little time to do it in." I think, Ben, you have it down to a countdown, in fact.

Ben: Yeah. Indeed. There's 423 days to go. Actually, as you said, really, what does this mean from a domain perspective? Whilst this regulation will impact pretty much every business that operates with European citizens, it also has an impact on domains as well. As many of you know, we are under contract with ICANN to provide registrar services and gTLDs and in that contract, there are provisions that require us to display data in a uniformed format. The same can be said for ccTLDs as well, and we operate under those principles.

However, next year, this regulation will provide privacy by design and by default, which in the long run means potentially that we can no longer display the WHOIS data for domain name registrations originating from Europe, especially around individuals. So for brands that actively monitor for infringements online, or use WHOIS to understand who owns a domain and whether or not a domain may be infringing, there may be the possibility next year and probably the likelihood that that information will no longer be acceptable.

As you see, there's sort of an underlying topic here, and that is that everything is interconnected. So as Gretchen said, there's changes to WHOIS coming around, and this definitely has an impact on how the internet operates and how registrars, not just corporate domain name registrars such as CSC, but large registrars like GoDaddy or 1&1, this will determine how they display data and how they keep data as well. So it can and most likely will have far-reaching impact on how we use the internet and how an individual's information is processed.

Now, privacy is of course, a great thing and something that should be championed. But ICANN doesn't really have an idea about what it is that everyone is supposed to do at the moment, and the impact of these changes, if they have compliance issues with contracts that are held with the contracted parties in ICANN. So yeah. It's going to have an impact. I think this is probably one of the best slides to really show this. As I said, everything that's going on at ICANN at the moment is really interconnected. You'll see at the top here, all of these different reviews that are ongoing.

There's reviews into Competition, Trust, & Choice, reviews into the Trademark Clearinghouse, which of course is probably well-needed, and the Root [inaudible 00:34:50] Stability Review, checking out whether or not the thing that operates the internet, the systems and the backbone that it operates on, whether or not it can handle the load of lots of new TLDs. Without that being done, we can't even talk about whether or not there'll be another round. Underlying to that are reviews into the WHOIS, reviews into new gTLDs. So all of these things have to play out in order to reach conclusions on lots of other different policies and reviews that are happening at the moment.

Gretchen: We talk about the interconnectedness of all the things that are happening within ICANN. But this GDPR even illustrates that there's interconnectedness to not only what's going on in ICANN, but around ICANN. It's funny because we have spent a heck of a lot of time through the years and particularly over the last three or four years, trying to improve WHOIS. We're going to talk a little bit about the database, the directory service that manages WHOIS, trying to make WHOIS accurate, trying to make WHOIS standardized.

We've done kind of a lot of those things recently, and now here comes a regulation that is going to challenge all of that. All those things that are put in place, they may quite honestly fall to the back burner, because of this ultimate kind of outside regulatory requirement. So it is. I'll use the pun, it's a tangled web, but it truly is. There's a lot to kind of think about and understand. All right. So why don't we jump into some of the things that are going on within ICANN that are all these interconnected pieces?

Maybe we can quickly talk about one of the things I just mentioned, the next generation of the Registry Directory Services, so RDS is Registry Directory Services. PDP is Policy Development Process. Ben, I know this is something you follow very, very closely. So why don't you share some insights there?

Ben: Sure. Thanks. So what this is, is this is a replacement, essentially, for the WHOIS service. Now, many of us will have used the WHOIS service to ascertain who owns a domain and all of the details that are provided when registering a domain. But that's seen as ununified service, and also on top of that there are two different types of WHOIS. There is the thick type, and that's where registries display all the data that registrars send to them, and then the thin type of WHOIS. That is only used by Verisign, so com and net, where they just hold the domain name and the name server data, and then all the other data is served up or supplied by the sponsoring registrar of the domain.

So those are seen as systems that are no longer fit for purpose, and ICANN have created a centralized database, where registrars are required to submit that information into that service, so it can be queried by authorized users. However, when this was launched, ICANN said that registrars have to use it for these specific TLDs, for thin registry TLDs, but granted an exemption from all the TLDs that are thin. So ultimately, this service is just sitting there, not being used at the moment. As we've just spoken about previously, having a centralized database of all domain name ownership in gTLDs may be in contravention, and we're soon to find out of the GDPR.

But also, is it's something that obviously holds a lot of information and could be open to abuse. So reviews are still ongoing. The working group has got to, I think, their 12th question, especially around the requirements and who has access, and how that data should be collected and stored. So there will be a change to the WHOIS. But as we've said, there are other things going on at the moment that may impact the validity of this system in the future.

So it's definitely something to look out for and definitely something that we'll keep you up to date on because it will impact the way that we search for who owns domains. We're able to search and see what other things people are doing and what domains they own through reverse WHOIS mechanism. This is something that will change the way that domains operate in the future. So we'll keep an eye on it, and we'll make sure that everyone is kept up to date with the changes.

Gretchen: Absolutely. We also provide on the bottom of this slide, a link to a page, sort of the microsite on the ICANN website, related to this PDP. So you can certainly learn more and kind of stay really in touch with the details as they happen, by visiting that page. So if you're interested, I certainly encourage you to do that. We also have a PDP going on around what they call "New gTLD Subsequent Procedures."

So it's a little bit of a mouthful. But what it really means is they're trying to look at the policies, the process, that was used for Round 1 and say, "Hey, what worked? What needs some help? Where did we have some misses? Where are there things that we didn't think about that we need to address through future policy?" So this is really looking at sort of how does this all translate in subsequent rounds?

Well, these working groups have been going on for some time, as you saw from the timeline, where we kind of piled up all the different issues being worked within the ICANN community right now. But while this has been going on for some time, the work that's been done has been pretty substantial thus far. In fact, there's so much to talk about here, they've had to break it up into four separate kind of work tracks, and they have sub-teams within the team to try to plow through all that needs to be discussed. You see here, a little bit of their timeline.

One of the things that you often quickly notice when attending an ICANN Meeting is, you go from session to session, and in one session they show you a timeline and they say, "Okay. Everything should be wrapped up by the end of 2017." Then, you go to a different session on a somewhat related and kind of interconnected topic and they go, "Oh, no, no. Not 2017. We need to go to 2019," and then you go to another session and it's somewhere in between. You never quite know where the time, the milestones, the benchmarks are.

But you can see the work that kind of not only needs to be done, but then needs to sort of be coalesced, and you quickly realize that this is a very long process. This is a multiyear process which I think everybody knew in advance, but it has a tendency to get some sprawl to it. We've also seen, we'll talk in a little bit about, how there also seems to be some pressure to pull it back. So anyway, they're working towards issuing a draft report. Their draft report should be coming in I would say the next 30 to 60 days.

Just to give you a sense of what some of the issues are in the different work streams, we've included that in the slides for you. But we're going to get some initial thoughts here, shortly, which will be good. But as you saw, their work really stretches out for some time beyond 2017. But also, right before the ICANN meeting, there's kind of an overarching review being done, which has to do with consumer trust, consumer choice. The overarching review, they issued a draft report right before the ICANN meeting.

In their draft recommendations report, they had a number of questions for these different subgroups. So for like the Subsequent Procedures PDP group, they had I think a list of 10 questions they think they should take up, in addition to the work that they're doing. Then, I think they had a list of maybe four or five questions for a group we're going to talk about in a second, which is related to rights protection mechanisms. So you can see how these groups kind of bounce off each other, and kind of they feel like they need information from other groups to be able to further their work. So again, kind of quite a tangled web.

So they're going through ultimately trying to answer some overarching questions. Should there be a second round? Should there be future rounds? How can we make it more predictable? How can we increase participation? How can we develop better policies? I think a lot of the overarching questions are pretty self-evident. But we'll have to wait and see what ultimately comes out of their recommendations. We'll certainly keep you posted, because they'll be posted for public comment, and there'll be an opportunity to share thoughts.

I know both Ben and I lived through the entire new gTLD process, from policy development through rollout, and I think we have both quite a long list of things that could've gone differently. There'll be a great opportunity to share those thoughts. We also have this new gTLD RPMs, which is Rights Protection Mechanisms PDP. The first part of this is really focused on the Trademark Clearinghouse. Actually, this is what's been consuming this group's time to date.

I think a lot of people would agree that there are some benefits to the Trademark Clearinghouse and that you only have to get your trademark validated once. You don't have to get it validated each and every launch. I think there's also been some cost efficiencies in only having to get it validated once. But I think there are some other things that the Trademark Clearinghouse could've achieved or could've brought to the table. This review will be an opportunity for those ideas and thoughts to come to the floor.

I know we've been talking quite a lot about some of the changes we'd like to see. It's really in response to our discussions with our customers and kind of the pain that they've felt of the expense of the Trademark Clearinghouse and just the overall kind of bureaucracy of it all. So we'll be following this one very closely as well. The timeline here kind of rolls out the timeline for Phase 1 here, which really sprawls until October of this year. Then, Phase 2, the estimated kind of starting point for that is 2-1-2018. So again, kind of seeing these reviews really stretching out. But there is, I think, some pressure to make it kind of narrow the scope a bit.

So we'll continue to watch this. Again, on the bottom of the slide, we have the link where you can get all the detailed information about this. But we'll continue to keep you updated. Sometimes these things, they move very slowly, and then all of a sudden, we'll have a lot to talk about. Then, this will certainly be one of those items. I'm looking at the chat and I'm looking at the Q&A that's coming in. This is usually the point in the program where people say, "So what's going to happen with Round 2? Is there going to be a Round 2? When is it going to happen?"

Ben and I, we've known each other for a number of years in the industry. But as we've kind of been working with each other now for over six months, we have kind of a little back and forth on our predictions for when Round 2 will happen. I think we both feel Round 2 will definitely happen. I see it more 2020. I just see so many things that have to happen before. But I know, Ben, you think maybe a little earlier. So maybe share your insights there.

Ben: Sure. So ordinarily, we would agree. But on this one, we're going to have to disagree slightly.

Gretchen: Yeah. We are.

Ben: I'll tell you why. Here's my insight into this. This isn't a conspiracy theory. There are so many things pointing to a speeding up of the process. Now, for those of you that were on the last webinar, you would've seen the timelines that Gretchen showed, especially where the Subsequent Procedures work went out to 2020. In fact, you had the interim CEO, Akram Atallah, talking about it being 2020.

But then, over the course of the last few months, you've heard the ICANN Chair Dr. Steve Crocker talking about, are there things in here that we actually have to answer? Are there questions that need to be answered for us to have a second round? Are there things in here that need to be done in order for you guys to carry on your work, and is there anything we can do to help? That's unprecedented from the ICANN Board. In fact, there was a letter from the ICANN Board to the GNSO, essentially, asking them to hurry up.

Now, you'd think with all of the attention on the New gTLD Program and the governments talking about making sure that there isn't abuse, and ensuring that lots of things are going on to protect consumers and protect rights, why would the ICANN Board want to accelerate the process to open up for another round? Well, Gretchen spoke about it right at the start, and that is there's not much money left in the kitchen. Now, ICANN drilled up their reserves by the tune of maybe $400 million in the last application round.

That was all of the applications that came in. That was everyone that paid their $185,000 to apply. Now, a lot of that money was spent on reviewing the applications, but also creating lots of roles and staff, and those staff have been trained and they're there in roles, and now they're running out of things to do. Now, the last thing you'll want is to get rid of all that expertise, only to bring it back in two years later. So ICANN really only has two options in terms of rebuilding their cash reserve and being able to support all of that interconnected work that's going on.

There are so many things that are happening. ICANN pays for a lot of people to attend meetings and working groups. It funds a lot of travel. It pays for the ICANN Meetings itself. So in order to keep up this work and make good on the promise that they made when oversight of the internet was handed over to them from the U.S. Department of Commerce, the only way to increase those funds is either increase the fees that registries and registrars pay for each domain that's registered. But that doesn't really get you anywhere, if you add one or two cents. What you'd want to do is open up a round where lots of people could apply again.

So it does sound a little bit conspiracy theory-like. But I think everything is pointing to the fact, and you'll see it when you download the slides about the new gTLD Subsequent Procedures PDP. They're talking about October 2018 as being the final issues report. So start [inaudible 00:53:41].

Gretchen: There is some writing on the wall. I'm with you.

Ben: Yeah.

Gretchen: I'm with you. There's some writing on the wall. I just always have this little voice in the back of my head that says, "Never underestimate the power of the GAC." Now, I do feel that for the first time during this meeting, I heard some things from the GAC that made me think, "Wow. They're not really demanding that everything be resolved before Round 2," like I really thought I heard in the past. So I do think there's some potential opening there. But it'll be interesting with the change of the chair and some other things going on to see if that continues. So we'll have this point-counterpoint debate as we go on. But definitely, a lot of tea leaves to read here.

Gretchen: All right. So with a few minutes left, we have two other quick things to cover off. Ben, why don't I ask you to cover off privacy proxy real quickly?

Ben: Yeah. So privacy proxy, this is an unregulated area of domain name ownership. So many of you will know in talking about this before, when you register a domain, some service providers allow you to mask all of the registration details, so no one can see who you are. They use that for many different ways, for their own privacy to ensure that their email address isn't spammed. But also, if you're using a domain for nefarious purposes, of course, you'll want your real details hidden.

Now, there's nothing to prevent you from typing in "Mickey Mouse 1 Disney Avenue." But there are some stupid criminals out there. So they'll put in their real details, and then use a proxy service over the top. However, this is unregulated. So the GAC saw this early on and many people within the community have asked for a change here. So what this is about is creating an accreditation program so the service providers that offer a privacy or proxy service can become accredited and can be subject to the rules of a contract that ICANN will put in place.

Now, that's going to be great for our customers, because it removes the unpredictability of when you find a domain that's potentially infringing or the content is infringing, and it's protected by a privacy or proxy service. It's often very frustrating to find out who's behind it. But there may be rules in place that mean that the service provider will have to reveal who owns a domain.

So this is coming about very soon. It is definitely something that we're keeping an eye on because of course we offer these services to our customers already. So we'll need to be compliant. But it's definitely going to be a benefit to all of our customers, and those that are keen on protecting their brand online.

Gretchen: Completely agree. To have some structure around this and some privacy of contract, quite honestly, between these providers and ICANN will be, I think, a very good development. It'll also be interesting to see how this interplays with the GDPR. So a lot to come here, but we'll continue to watch this space. The last thing is more what I'm going to call a public service announcement, if you will. There is something about to happen that is very technical in nature.

So I know a lot of people who attend this call, they're not the technical people in the organization. But I am asking you to make sure that your technical people know about this. So what's about to happen is ICANN is going to, for the first time, there's going to be a key signing key rollover, basically, a change in the top pair of cryptographic keys in the Domain Name System, related to something called DNSSEC. This rollover is a process. It's not a single event. But it is expected to be completed by March 2018.

In a lot of ways, I think of this like, for those of you who are old enough to remember, kind of the Y2K thing. Right? It was this thing that we all really worried about. We thought about all the things that could break. A lot of people spent a lot of time trying to make sure that didn't happen, and it didn't turn out to be the big kind of disaster that a lot of people predicted. But when you look at the fact that it's estimated that 1 in 4 global internet users, or 750 million people, could be affected by the KSK rollover, it's something that warrants some attention by your tech team.

They may already know about it. But if they don't, you're going to be a hero here, because you're going to let them know about it. You'll see a link here to a page where they can get all the information they're going to need about it. ICANN has actually just released a test site for them to be able to test hardware systems, things like that, in this new environment with these new keys. So I really encourage you to share this slide and this link, particularly, with your tech team. If they don't know about it already, you will be a hero.

So I know we've gone . . . we're actually just at time. All right. I know there's some questions in the Q&A, but maybe we can follow up on them. Or I don't know what you want to do, Anu. I'll pass it over to you.

Anu: Thank you, Gretchen and Ben. The presentation was great and lots of helpful information. As Gretchen said, we would normally take a Q&A session, but there was so much information we wanted to share with you that we will answer your questions offline. Just as a reminder, you can download today's materials from the resource widget. If you would like more information about Digital Brand Services, we have a screen up for you to make a selection on how you'd like to be contacted.

I'd like to thank all of you for joining us. Again, a big thank you to Gretchen and Ben. If we didn't get to your question, we will contact you with a response shortly after the webinar, and we hope to see you next time.