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The race is on for ownership of .net

Five contenders and the lobbying has already begun

The deadline has closed and there are officially five companies bidding to take over the Internet's third-biggest registry - .net.

From 1 July this year, 5.1 million .net domains will be handed over to the applicant that an independent group of advisors, working under the auspicies of ICANN, decide is most suitable. Their decision will be made in just two months.

Lined up are: Afilias, Core++, Denic, Santan and VeriSign.

It is the biggest shake-up of the Internet landscape for two years, when all 2.4 million .org domains (there are now 3.2m) were handed over to the Public Interest Registry. There are similarities - the .org registry was previously the property of VeriSign (which also runs all .coms), and the company running the back-end is Afilias, which is one of the three contenders for the .net crown.

However, the issue of who will get to run a big chunk of the Internet is far bigger than ownership and power - it also has an intriguing political angle. VeriSign currently runs all .net domains and it is going all out to win the contract back. Without .net, it may still have the most profitable registry (.com with 31.9 million domains) but it will be a huge blow to the company that was the Internet pre-1999.


But while VeriSign's kudos and wallet would be hit by a decision going against it, even more dangerous would be the undermining of a system created entirely by VeriSign for VeriSign's benefit. For every single .net and .com domain registered, VeriSign makes $6 - whether it sold the domain or not. VeriSign claims this is what it costs to run the registry infrastructure. However, everyone else bidding for .net says this $6 is too high and all have vowed to reduce it.

A loss of .net for VeriSign means an end to its price controls on .coms as well, especially with ICANN promising more new global top-level domains soon. Monopoly control will finally be wrest away.

These very reasons are also why ICANN would desperately love for its old foe to be humbled. With VeriSign weakened, ICANN can start to assert itself properly over the Internet. It may even mean the end of the lengthy legal battle that VeriSign has been running against ICANN - something that is as much a bartering chip as it is a legal dispute.

And up against VeriSign are, intriguing, all non-US companies - an indication, if you needed one, that the days of the internet being an American toy are well and truly over.


Afilias currently runs both .info and .org domains - 6.1 million in total. It clearly has enough expertise, but it has faced a lot of criticism recently. Alot of it stems from its initial running of .info, which even the company admitted didn't run entirely smoothly.

But then that was back in 2001, and it was a brand-new registry, starting from scratch.

Another criticism is that the .info registry fell over for a day this past September when a registrar tried to register one million names in a very short timeframe - Afilias' system managed just over 300,000 before it collapsed.

Neither of events should preclude Afilias from running .net, but a remarkable number of press reports have started questioning Afilias's fitness to run such an important registry. Can we perhaps see the hand of VeriSign behind this queries?

VeriSign has certainly embarked on a massive lobbying spree, frequently arming journalists with interesting snippets of information and forcefully suggesting that ISPs may want to support its bid.

What for example are we to make of the 12 letters sent to ICANN head Paul Twomey by various companies and ISPs around the globe stating their support for VeriSign to continue to run the .net registry? Nothing you say? Except look a little closer and - how odd! - many of the letters have exactly the same wording. And everyone makes their key point that VeriSign has had "100 percent uptime". What a coincidence that the main competitor, Afilias, is being criticised for just that at the same time that everyone else is pointing out that is what VeriSign's strength is.


Meanwhile, contender number three - Santan. You won't have heard of it because it's a new company that comprises NeuLevel - which runs the .biz registry and Japan Registry Services. There are 1.06 million .biz domains. Again, questions are being raised over whether NeuLevel can be trusted - after all, a move to five million domains from one million is a big leap.

NeuLevel is also used to playing a different sort of domain game - it is very pro-business and red-tape and that's fine if the registry is new, but millions of .net domains will be owned by Average Joes and if a company isn't used to the odd situations that dealing with the public can throw up, there is a risk that it could be swamped.

As so, it would appear that VeriSign tactic of focussing on stability and raising questions over Afilias and NeuLevel is a good one. Except it wasn't counting on Denic.


Denic runs all Germany .de domains - 8.0 million of them. It is the second-biggest registry in the world and it can also boast a high level of service. Perhaps just as importantly, Denic is also going all out to win the contract.

If VeriSign is going to get people to send copycat letters to ICANN saying why it should be chosen as the .net operator, then Denic is going to as well. If has yet to reach VeriSign's 12, but Paul Twomey now has six pro-Denic letters on his desk (you can see all the letters incidentally on ICANN's website here). Some of Denic letters are identical save the person signing them, and - blimey! - all of them point out Denic's 100 percent uptime record.

Most revealing are two letters from Deutsche Telekom - Germany's biggest telco and a major international player. One, sent on 16 July 2004, gives VeriSign its wholehearted backing. Then, suddenly, on 10 September, a second appears in which it is explained the first letter was a mistake and Deutsche Telekom really supports Denic. "It is my serious duty that this particular letter [the first one] has been signed by myself as a result of accidental concatenation of internal administrative misinterpretations" - seriously, read it here [pdf].

Now how much pressure do you think it takes to make a senior exec in one of the world's biggest telcos write a letter like that?

At the same time, Denic has also started getting the press onside. While VeriSign rallies US journalists, Denic has already covered Europe and has started getting into the US IT press as well - see this CNet story.

So Denic isn't messing about and while ICANN would love nothing more than VeriSign to lose the .net registry, it would be equally delighted to see Denic win it. Why? Because Denic is the most powerful registry outside of ICANN control.

ICANN has no jurisdiction over the different countries of the world. It hates this and for years has pressed different countries into signing a contract that them to accept ICANN as having overall control. Denic, along with Nominet (which runs .uk domains), have been the two most vigorous and public opponents of ICANN over this.

That tactic has since been abandoned by the Twomey ICANN administration - and the rest of the world and ICANN have at last started getting on. For ICANN to sign up the biggest previous opponents of its rule, and for it to run a registry under ICANN's control would be a major feather in its cap.


And that brings us lastly to CORE++ which is a surprising but worthy outsider in the battle for .net. CORE++ has been set up purely to run .net and has set up an explanatory website for its existence.

It is a huge consortium of domain registrars, registry operators, telcos and technology companies. CORE itself runs the .aero and .museum registries, and the others include the Internet Systems Consortium, the National Internet Development Agency of Korea, (which runs .kr), and the .za domain name authority. It is based in Barcelona in Spain.

However, while this consortium would most closely follow the Internet tradition of working with one another, it seems likely that it will be an also-ran since the evaluators will want to see a company that is already up and running a huge Internet infrastructure. There is the risk that too many cooks may spoil the broth.

And so, the winner is...

And so, in conclusion, what we have is a two-horse race: VeriSign and Denic. Both are more than capable of running .net and both want it badly and are willing to fight for it.

How much the evaluators will be swayed by other pressures will be interesting to see. It could even be that with the pressure exerted by the two lead contenders, they surprise everyone and go for, say, CORE++. But in all likelihood it looks as though either VeriSign or Denic will take the top prize.

As for who these evaluators are: well ICANN said it might release their details but nothing has happened as yet, and the organisation may be wanting to shield them. Plus of course that may give ICANN a little extra persuasive power.

Who will win? Well, for the good of the Internet, our bet goes with Denic. ®

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