ICANN on the verge of financial collapse

Daily Newsletters

Sign up to ZDNet UK's daily newsletter.

NEWS
The private, non-profit group tapped by the Commerce Department to create competition in the domain name registration business is broke and in danger of not being able to function beyond the end of August. The group has asked for and received an offer of private sector fund-raising support from a White House official; if those solicitations were actually made, the actions might violate federal law. The organisation is known as the Internet Corporation for Assigned Names and Numbers, or ICANN. In a 7 June email from Mike Roberts, ICANN's interim president and CEO, to officials from IBM and MCI Worldcom, Roberts says: "Reality suggests that unless there is an immediate infusion of $500,000 (£310,000) to $1m, there won't be a functioning ICANN by the end of August." ICANN is charged with overseeing the move to competition in the domain name registration business from the current government-sponsored monopoly handled by Network Solutions. ICANN has raised the ire of many in the Internet community for overstepping its mandate and setting up the groundwork for a United Nations-like structure for Internet governance. Congress has recently taken ICANN to task over several of its policies, causing the organisation to abandon or modify some of its plans, such as a proposed imposition of a $1 fee on every new Internet domain name registered and the practice of holding closed door board meetings. During a recent congressional hearing, ICANN's Roberts testified that the organisation was about $800,000 in debt and scrambling for additional funding. ICANN's fiscal year 1999-2000 budget is $5.9m. According to emails from ICANN officials, the organisation has gone hat-in-hand looking for a cash infusion from high-profile companies such as IBM and MCI Worldcom. MCI Vice President Vint Cerf wrote in one email to ICANN board members that he had contacted officials at his own company and those of IBM looking to come up with $1m in "bridge" funding, which ICANN could pay back "at a later time under reasonable terms". Cerf suggested keeping the funding quiet while a new ICANN fund raising campaign was kicked off "knowing that we have the ability to back up the campaign with a rescue effort in the short term". Cerf also suggests that the campaign be based on the notion that "ICANN must succeed or Internet will be in jeopardy. This ought to play well with any company whose stock price is dependent on a well-functioning Internet". In addition to hitting up large companies, ICANN also has enlisted the help of the White House. In a 15 June email, Joe Sims, ICANN's attorney, says that he and Esther Dyson, ICANN's interim chairman, met privately with Thomas Kalil, the senior director for science and technology issues on the White House's National Economic Council, to enlist Kalil's help in soliciting funds from the private sector on ICANN's behalf. Kalil "promised to do what he could to encourage private donations", Sims wrote. ICANN's Roberts, in a 17 June email to Kalil, writes: "Tom -- pleased to hear about your offer of help." Roberts promises to send Kalil a "private and confidential financial statement" that outlines ICANN's financial standing. Roberts asks for a fax number where he can send the information, "if you'll give me a number for a machine where the schedule won't get loose." Such solicitations by a government official on behalf of a private organisation would be prohibited by US law. Kalil said he had "no comment" on whether he made such solicitations and said he had "no comment" on why he couldn't comment. Roberts is on vacation and could not be reached for comment. The issue of ICANN's precarious finances and the involvement of the White House in its fund-raising efforts also has drawn the interest of Congress. A letter Wednesday to ICANN's Dyson from Commerce Committee Chairman Thomas Bliley questions the "propriety of the involvement of White House personnel in ICANN's fund-raising activities". Bliley asks ICANN to provide his committee with all correspondence with anyone in the executive branch, including the Office of the President and whether those persons were acting in an official or personal capacity. Bliley earlier sharply criticised Sims, ICANN's lawyer, for having discussions with a lawyer in the antitrust division of the Justice Department regarding putting pressure on ICANN to work more closely with NSI to help speed up the commercialisation of the domain name registration process. NSI is currently being investigated by the Justice antitrust division. In an email message to prospective funders of ICANN, John Patrick, IBM's vice president of Internet technology, writes: "Not to sound alarmist but if ICANN fails e-buiness/e-anything is in jeopardy." That dire outlook, however, isn't universally held. If ICANN goes out of business, "the Internet is saved from a regulatory fiasco," said Tony Rutkowski, president of NGI Associates, an Internet services consulting firm. "A lot of people's resources get redirected to more useful endeavours, and the Internet's administration continues to function quite well, thank you," said Rutkowski, who is an outspoken critic of ICANN. The domain name registration system would continue as it is now, said Karl Auerbach, an engineer for Cisco Systems. At most there would be "momentary panic, nothing long term", Auerbach said.

Post your comment

In order to post a comment you need to be registered and logged in.

You can also log in with Facebook. Log in or create your ZDNet UK account below

  • Login

Will not be displayed with your comment

By signing up for this service, you indicate that you agree to our Terms and Conditions and have read and understood our Privacy Policy. Questions about membership? Find the answers in the Community FAQ

Get ZDNet UK's daily newsletter

Enter your email address to sign up

ZDNet UK Live

BrownieBoy

@Jack, > Works really well for thieves.... Nice attempt to deflect the argument by tossing in a point that's totally irrelevant, even it were...

10 hours ago by BrownieBoy on AMD Ultrathins to challenge Intel Ultrabooks
bootlegger

Make that 13 people now - I got refused today at Manchester airport. I thought I was up to date on this legislation - I knew of the EU ruling from...

13 hours ago by bootlegger on UK airport body scans will not be opt out
tinycg

Don't forget to check out apps like GoodReader or SlideShark either, they're indispensible for people on the go in presentation situations. Best...

16 hours ago by tinycg on Four top iPad apps for people on the move
TerryRK

Well it seems there is something a number of us agree on. Why is the Ubuntu Unity launcher so ugly? I thought perhaps it was something to do with...

20 hours ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
Freebies202

Duplicate comments are not made intentionally. Its very good to know that now you are keeping check on this problem because sometimes a commenter...

1 day ago by Freebies202 on Microsoft fixes blog comments, speeds up blogs with open source
kevinmchapman

"the very significant number of users" and "many (most) of us" - you have no evidence for these statements. It is a fact that most users are saying...

2 days ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
Marg Menzies Harrison

Another grammar faux pas is the improper use of "you". When sitting down down in a restaurant, for example, I get cringe when the waitress...

2 days ago by Marg Menzies Harrison via Facebook on 10 flagrant grammar mistakes that make you look stupid
zdnetukuser

And NOW, folks, for Canonical's next trick... Kubuntu is late. Here's a pencil. Draw your own conclusions. cf.:...

2 days ago by zdnetukuser on Linux Minterface
Moley

@kevinmchapman. The discussion here reflects the very significant number of users who really do like the traditional menu system and who wish to...

2 days ago by Moley on A tale of two distros: Ubuntu and Linux Mint
kevinmchapman

Er, no... It is an efficient means of finding the application/file/setting you need in one place. The icons are a simply a fallback for when you...

2 days ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
TerryRK

Isn't the provision of a text based search an admission by the developers that the mass of icons approach does not work? I don't need to use a...

2 days ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
kevinmchapman

"Unity and GNOME 3 both abandon the old text-based cascading menus in favour of a graphical icon-driven system." Point truly missed. Both use a...

2 days ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
TerryRK

whs001 - Thank you, I'm glad you liked the article. I absolutely agree with you on your first point. I should perhaps have made it clearer that...

2 days ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
Dennis Nilsson

If we allow corporate interest to dictate the way our government circumvents due process against foreign entities then we should accept the same...

2 days ago by Dennis Nilsson via Facebook on ACTA stumbles in Germany
GHar123

I totally dislike pirating of works, I fear that artists will be deterred from creating works if they think that they are going to get ripped off....

2 days ago by GHar123 on ACTA stumbles in Germany
JCB33

How dare film makers, artists or anybody that invests in creativity stop us pirating their works for free. I want to be able to walk into my local...

2 days ago by JCB33 on ACTA stumbles in Germany
Moley

@GrueMaster. I prefer horses for courses rather than one size fits all. I, and I suspect most other computer users, do not really wish to have...

2 days ago by Moley on A tale of two distros: Ubuntu and Linux Mint
greycynic

The product that scares me every time I have to use it is the Office 2007 version of Excel. The first bug that I found was applying the median...

2 days ago by greycynic on Ten flawed products that derail productivity
GrueMaster

Nice review and very informative. One thing I'd like to add (in reply to whs001's 1st question), the main reason to have the same interface from...

2 days ago by GrueMaster on A tale of two distros: Ubuntu and Linux Mint
Frederick Wrigley

I'be been using Mint 12 since the RC came out, and I am far more happy with the Cinnamon, the Mate, and, yes (with extensions), theGnome 3...

2 days ago by Frederick Wrigley via Facebook on A tale of two distros: Ubuntu and Linux Mint