[WSIS CS-Plenary] Trade group embroiled in ICANN dispute

[mclauglm at po.muohio.edu]

Story URL: http://news.zdnet.co.uk/business/legal/0,39020651,39238834,00.htm
Trade group embroiled in ICANN dispute
Staff
Reuters
November 29, 2005, 15:55 GMT 

A trade group of Internet businesses challenged a 
proposed settlement over control of the .com 
domain as a violation of US antitrust laws in a 
lawsuit filed in a California federal court on 
Monday.

The World of Domain Name Developers group asked 
the court to stop ICANN - the non-profit body 
overseeing the Internet's addressing system - 
from allowing VeriSign to maintain control of the 
lucrative .com domain until 2012.

That proposed deal, reached in October, settled a 
long-running dispute between ICANN and VeriSign 
and is expected to be finalised by the end of the 
year.

The lawsuit, which was filed in federal court in 
San Jose on Monday, said the proposed settlement 
violates federal laws against price fixing and 
creates a monopoly of the .com and .net domain 
name markets.

Plaintiffs' attorney Patrick Cathcart said the 
settlement fixes the price of registering any 
.com or .net far above market rates. He also said 
terms of the settlement guarantee VeriSign annual 
price increases at double the rate of inflation.

ICANN could not be reached for comment, while a 
spokesman for VeriSign declined to comment on 
pending litigation.

The original dispute between VeriSign and ICANN 
arose after VeriSign introduced a new service 
called Site Finder in September 2003, directing 
Internet users who mistyped domain names to a 
VeriSign site that allowed consumers to choose 
from a list of alternative names. VeriSign 
planned to make money by selling advertisements 
on the site.

ICANN ordered VeriSign to temporarily shut down 
the service a month later, after engineers said 
it could interfere with the stability of the 
Internet.

VeriSign then sued in February 2004, saying the 
Internet body had overstepped its authority and 
illegally restrained competition. The case was 
thrown out of US court in August 2004, but 
VeriSign refiled in California state court.

The two parties reached a proposed settlement in 
October, in which VeriSign maintained control of 
the database of 35 million .com domain names 
until 2012. The contract would have otherwise 
come up for renewal in 2007.

VeriSign makes $6 (£3.50) per year from each of 
the 35 million .com domain names in use. It also 
controls the .net domain, which contains nearly 6 
million names.

The settlement also requires ICANN to review 
within 90 days new products or services 
introduced by VeriSign and its competitors that 
might affect the domain name system.
-- 
Lisa McLaughlin, Ph.D.
Associate Professor, Mass Communication & Women's Studies
Editor, Feminist Media Studies
Director of Graduate Studies, M.A. Program in Mass Communication
Union for Democratic Communications Representative,
World Summit on the Information Society

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