Testimony of Larry Irving
Assistant Secretary of Commerce for
Communications and Information
before the House Committee on Science
Subcommittee on Basic Research
September 25, 1997
Introduction
Good morning. Thank you for inviting me to testify before the House
Science Committee, on the issues of Internet domain names. No single force
embodies the electronic transformation we are experiencing today more than
the evolving medium known as the Internet. Once a tool reserved for scientific
and academic exchange, the Internet has emerged as an appliance of every
day life, accessible from almost every point on the planet. Students across
the world are discovering vast treasures of data via the World Wide Web.
Doctors are utilizing telemedicine to administer off-site diagnoses to
patients in need. The Internet is being used to reinvent government and
reshape our lives and communities. Finally, as the Internet empowers citizens
and democratizes societies, it is also changing classic business and economic
paradigms.
Given that over the next decade, advances in electronic communication
will affect almost every aspect of our daily life, it is important that
we look to preserving the integrity and stability of the Internet. And
the way in which we address controversial issues surrounding Internet domain
names will affect our ability to realize the full potential of the Internet
in the years to come.
Background on the Domain Names Controversy
Domain names are the familiar and easy-to-remember names for Internet
users (e.g. "www.thomas.loc.gov"). They correspond to unique
Internet Protocol (IP) numbers (e.g. 98.37.241.30) that are used to address
computers and route traffic on the Internet. Despite the growth and commercialization
of the Internet, major components of the domain name system are still under
the supervision of the U.S. Government:
U.S. research agencies have been trying to reduce and eventually eliminate
their roles in these infrastructure functions, as they have done with respect
to the provision of backbone and interconnection services. The decision
to allow NSI to charge user fees privatized the allocation and management
of domain names from a budgetary standpoint. NSI, however, remains in a
monopoly position with respect to the most valuable name space -- ".com"--
creating a situation that is not acceptable to many in the Internet community.
This situation could become especially problematic if NSI were to remain
in sole control of the .com domain upon expiration of the NSF/NSI cooperative
agreement.
In response to NSI's apparent monopoly, and NSF's announced intention
to let the cooperative agreement with NSI expire in 1998, IANA and the
Internet Society (ISOC) organized the International Ad Hoc Committee (IAHC
or the Ad Hoc committee) in September 1996, in partnership with the World
Intellectual Property Organization (WIPO) and the International Telecommunications
Union (ITU). The Federal Networking Council (FNC) participated in the early
deliberations of the Ad Hoc Committee.
The IAHC issued a draft plan in December 1996, which generated some
6000 comments. The final report proposed a memorandum of understanding
(MOU) that would establish, initially, seven new generic top-level domains
(gTLDs) to be allocated on a non-exclusive basis by new private registrars.
Under the MOU, registrants for second-level domains would be required to
submit to mediation and arbitration, facilitated by WIPO, in the event
of conflict with trademark holders.
The MOU was opened for signature by companies and governments at a meeting
sponsored by the ITU in April of 1997. To date, some 150 entities have
signed the MOU, including a few major carriers, such as Deutsche Telekom
and MCI. Only one government has signed thus far. Meanwhile, the Ad Hoc
Committee itself has transformed into an interim Policy Oversight Council
(iPOC) and has begun processing applications for new registrars. To date,
10 applicants have been qualified as registrars. This interim Policy Oversight
Committee will continue to accept applications until October 16, 1997.
The IAHC process has been criticized for being exclusive, especially
for lacking industry participation. iPOC has made concessions to these
critics, however, and has removed the limit on the number of registrars
for the new generic top level domains. More recently iPOC has invited further
public input on several important aspects of the MOU, employing a formalized
notice and comment procedure. Overall, iPOC has demonstrated a commendable
degree of flexibility in the face of these criticisms.
Since the announcement by NSF that it would not renew the cooperative
agreement with NSI, NSI has suggested that it may own a proprietary interest
in .com, .net, and .org. NSI has not clarified the exact nature of this
alleged proprietary interest, and has stated publicly that, not withstanding
such an interest, it will act in the best interests of the Internet including
sharing the valuable .com name space.
Request For Comments
The Clinton Administration supports the continued privatization and
commercialization of the Internet and is committed to completing the transition
to private sector governance. We realize, however, that this transition
must be accomplished in a way that enhances the stability of the Internet
and ensures its continued smooth operation.
An interagency working group has been studying domain name problems
since March 1997. On July 1, 1997, President Clinton announced the Administration's
Framework for Global Electronic Commere. As part of this initiative, the
President directed Secretary Daley to support efforts to make the governance
of the domain name system private and competitive and to create a contractually
based self-regulatory regime that deals with potential conflicts between
domain name usage and trademark laws on a global basis. This directive
has the highest priority at the Department of Commerce and throughout the
Executive Branch.
On July 2, 1997, the Department of Commerce, on behalf of the interagency group, issued a Request for Comments on the Registration and Administration of Internet Domain Names (RFC) in order to ascertain the views of the public regarding various domain name policy issues including the appropriate role of government in the operation of domain name system.
To date, we have received over 430 comments, amounting to some 1500
pages. The RFC elicited thoughtful comments from around the world, representing
diverse perspectives.
In accordance with this Committee's desire to reduce the number of printed
pages, I have not provided a hard copy of the comments received (although
I would be happy to do so). These comments are readily available, however,
at the NTIA site on the World Wide Web, the URL for which is "www.ntia.doc.gov".
I have provided a summary of comments prepared by the interagency working
group in Appendix
A to my testimony.
General Observations
Let me start by saying that the comments we received reflect overwhelming
support for two things: private sector governance of, and increased competition
in, domain name systems. Moreover, the principle of globalism received
strong support. Most commenters agreed that the transformation of the Internet
from its U.S. roots into a global medium should be reflected in the Internet's
administrative bodies. Many warned that continued treatment of the Internet
as a "U.S. asset" could provoke a negative reaction from foreign
governments, businesses, and consumers.
Having said that, many commenters expressed a preference for making
a smooth transition to the "right" system over rushing to adopt
an ill-considered solution. We believe, and commenters agreed, that consensus
must be achieved through an open and democratic process that is as expeditious
as prudent consideration of these important issues permit.
Principles
The interagency group posited six principles that might be used to evaluate
proposals for registration and administration of Internet domain names:
In general, respondents supported these principles. Many proposed nuanced
revisions or suggestions to emphasize different issues. A number of commenters
suggested additional principles. Only a very small number disagreed with
one or all the principles entirely. The interagency working group is studying
the comments, and may refine the principles in light of the comments. At
this point, however, comments did not reflect a view that the proposed
principles should be modified in any comprehensive way.
Organizational Issues
According to respondents, the biggest advantages of the current system
are its familiarity and the fact that it generally works. Disadvantages
include the lack of competition, concerns about scaling capacity, and,
notably, the potential for trademark conflicts. Not surprisingly, then,
respondents thought the system could be improved by introducing competition
and creating alternative dispute resolution processes to mediate conflicts
of all sorts.
Commenters disagreed about the appropriate structure of domain name
systems going forward. Some stressed that top-level domains are a global
public resource and must be maintained as such. Others argued that top
level domains are a private resource for individual businesses to develop
exclusively. Nonetheless, commenters agreed that no single company should
be allowed to monopolize domain name registrations.
Commenters that mentioned the IAHC proposal, more often than not, supported
it (although sometimes for different reasons). Those who opposed the IAHC
plan characterized it as an attempt to improperly assert control over the
Internet. Even supporters felt that the size and makeup of any governing
organization must ensure that policies promulgated represent a true consensus
of the Internet community.
In general, respondents identified the root domain database and the
root domain servers as an essential core that needed to be preserved as
a separate, independent entity, free from government and commercial pressures.
To the extent that IANA performs these functions today, most respondents
were complimentary of the job it was doing.
As I said, respondents overwhelmingly favored private sector governance
of the domain name system, and urged government to take a back seat in
the registration and administration of Internet domain names. Jon Postel,
Director of the Computer Networks Division at USC said: "The role
of government should be to foster a fair system of self-governance for
the Internet that embraces open competition where possible on an international
scale."
Commenters had more varied and even contradictory attitudes toward the
role of international, inter-governmental organizations (IGOs), especially
the ITU. Some commenters expressed deep misgivings about IGOs taking a
leading role in Internet governance. Many commenters viewed organizations
like the ITU as unaccountable, unelected, and unlikely to consult with
the Internet community. Others criticized it as moving too slowly to address
rapidly developing Internet issues. Still, a sizeable minority of commenters
argued that international organizations provide ready-made fora for reconciling
competing national and commercial interests. International organizations
were also seen as exerting a useful check on domination of Internet governance
by the United States.
Creation of New gTLDs
The comments reflected extensive support from the technical community
for the addition of new gTLDs. On the other hand, trademark owners for
the most part weighed in against the creation of new gTLDs out of concerns
that they would increase policing burdens and give bad actors more opportunities
to infringe.
A substantial number of commenters addressed the type of new
gTLDs that might be created. Several suggested that any new gTLDs that
are created should be distinct enough in their intended purpose to minimize
the chance of confusion created by the desire of name holders to register
their name in all domains. Though many commenters found the concept of
creating special-purpose gTLDs attractive, they expressed concerned that
the specific top level domains proposed by IAHC could "raise questions
about global transparency and potential duplication and user confusion."
Several commenters urged that gTLDs correspond to the categories in
an industrial classification system. Others suggested that we address the
need for complementary business gTLDs by encouraging the use of ".com.us"
and perhaps by "cloning" .com (that is, by allowing the use of
".com1", ".com2", etc.) to mitigate the demands for
the same name space by companies with similar names.
Policies For Registrars
Most respondents favored a system in which domain name registrars generally
exercised non-exclusive control over gTLDs. These commentators believe
that shared registries will protect consumers by promoting competition
and enhancing choice, avoiding problems of "lock in" and high
switching costs. Even in this group, however, commentators noted that there
may be circumstances under which exclusive TLDs may be desirable. Several
cited ".gov" as an example of an appropriate exclusive TLD.
Another sizeable group of commentators favor a mixed shared/exclusive
system, noting that these distinctions can serve as a useful dimension
of competitive offerings, creating more choice for consumers. This group
favored allowing the market to determine the optimum mix of exclusive and
non-exclusive top level domains.
In general, respondents did not believe that technology would ultimately
limit creation of shared or mixed shared/exclusive registry systems.
Many, however, noted that as the technology for shared registries does
not yet exist, any transition plan should assess technical obstacles realistically,
and plan accordingly. (Several commenters did refer to the shared registry
now operating in the United Kingdom. Our understanding is that the underlying
technology used in this system is not sufficiently robust for a global
DNS system.)
A majority of the respondents favored establishing threshold requirements
for registrars, citing the need for stability and consumer protection.
Suggested qualifications involved: technical skills, operations skills
and experience, and financial resources. A number of respondents cited
the IAHC requirements approvingly, although one commenter described them
as "too U.S.-centric." The iPOC itself cautioned that threshold
qualifications should be kept to a minimum in order to promote diversity
and participation in the DNS by developing countries.
A sizeable minority of respondents asserted that the marketplace should
determine whether and what requirements and responsibilities a domain name
registrar should have. Registrants, in the view of this group, should be
free, after full disclosure, to deal with any registrar they choose.
Trademarks
The comments indicated general agreement that trademark rights (registered
and common law trademarks, trade names, business names, etc.) should be
protected. Commenters focused, however, on how trademark rights should
be protected, i.e., by national courts or some other types of dispute resolution
mechanism.
All commenters agreed that the national courts should remain an option
for trademark protection, and indeed the technical community expressed
a preference that this should be the only forum for trademarks disputes.
However, trademark owners and attorneys indicated that they would prefer
an additional alternative dispute resolution mechanism for some kind of
first level clearance to deal quickly with cyber-pirates.
There was general consensus among the commenters that there should be
no preliminary review process. First, such a review would add unwanted
delay to the registration process. Second, most commenters did not want
the registrars to review applications on any substantive grounds. Finally
a standard of review would be too difficult to establish and enforce.
Only a few respondents supported the institution of a waiting period
after the filing of an application but prior to registration so that disputes
could be filled. However because there are currently a fairly low number
of actual disputes, it appears that establishing a short period after registration,
during which a domain name could be suspended in the event of a conflict,
would be a less intrusive procedure. For the majority of domain names there
has been no trademark conflict.
There is general agreement that domain name/trademark conflicts cannot
be prevented in an international arena - but they can be minimized with
certain technological solutions. The commenters agreed that a searchable
domain name database with up-to-date contact information would certainly
be helpful for clearance purposes. There were also a few comments suggesting
that a worldwide trademark registration database would be helpful to deter
conflict, however it is generally agreed that such a database would be
too difficult to maintain.
Conclusions
Overall, we found the comments to be extremely thoughtful and quite
helpful. Obviously, there is much that is not settled under the proposed
plans for domain name system governance, and the public is justifiably
concerned about the stability and reliability of the Internet environment
in the wake of any new system of governance and new technologies for registries.
As I said, the comments supported transition to a private sector driven,
competitive system of domain name allocation and management. But a number
of issues must be resolved in the course of that transition.
For the sake of simplicity, I believe we should divide these issues
into three categories.
First of all, it does not appear that the technology to manage a fully
competitive registry system involving shared top level domains currently
exists. Although almost everyone concedes that such technology can be readily
developed, estimates about development time and cost vary widely. Some
assert that existing technology can be easily modified and ready for testing
quite soon. Others predict a six to eight month development path, or longer.
Cost estimates range from virtually nothing, on the theory that this technology
will be developed cooperatively, to several million dollars.
Second, it seems clear that the governance structures proposed to date
are not adequately democratic or representative of the ever-expanding Internet
community. Additional discussion is needed to reach consensus on
a private sector governance structure for DNS, with attention to important
questions such as: "Who gets to decide? How are the decision-makers
chosen? And what recourse is available in the event that the Internet community
becomes dissatisfied with the performance of the selected decision-makers?"
Moreover, we must transfer the policy oversight functions now performed
by IANA to a permanent setting with stable funding, deep expertise, mechanisms
to guard against anticompetitive behavior. As I said, the Internet community
by and large expressed satisfaction with the current arrangement, so that
the need for change here seems less pressing. Nonetheless, the inter-agency
working group, DARPA, and USC all agree that the current arrangement is
not viable on a long term basis.
Finally, additional consensus is needed with respect to important intellectual
property problems, especially, but not exclusively, in the area of trademark.
The IAHC has set out the contours of a dispute resolution process, the
details of which require further attention. Trademark owners must be comfortable
that their rights will be protected adequately, if not perfectly. The number
and type of new generic top level domain names must thus be carefully considered.
Resolving the question surrounding technology, governance and trademark
will, unfortunately take some time. We are quite confident, however, that
adequate will and the basis for agreement can be mustered to complete the
transition to a robust, stable, competitive, global, and private-sector
driven system over the course of the next year.
Transition Strategy
First of all, we believe the U.S. Government must act promptly to assure
the Internet community that it will preserve the stability and integrity
of the Internet during a transition period. We believe that IANA should
be funded during the transition period. We also believe that the government
should, if necessary, utilize the NSI "ramp down" option in the
cooperative agreement, providing the option to rely on the current system
through fiscal year 1998. Finally, we also believe that the government
should, if necessary and in accordance with the provisions of the cooperative
agreement, receive a copy and documentation of any and all software and
data generated by NSI under the cooperative agreement in such form and
sufficient detail as to permit shared registration in the .com space.
Second, the interagency working group must complete and make available
a detailed analysis of comments submitted in response to the Department
of Commerce request for comments. Based on this analysis, we would
expect to issue policy recommendations with respect to each of the questions
Although I do not want to pre-judge the final recommendations, I believe
that they are likely to contain the following elements:
Concluding Remarks
Although I have outlined a transition roadmap in very broad terms, the
Administration does not underestimate either the importance or the complexity
of this task. I look forward to working with all interested parties, including
the Congress, throughout this important transition period.
I would be happy to answer any questions that the Members may have at this time.