I wanted to share some thoughts with all of you on a dark day in Internet history. On October 15th the price of a .com will increase by $0.42, marking the first price increase in the history of the modern Internet. Worse, this now signals a near-annual event that will take place in all major gTLDs. It is simply wrong. My full comments in the public forum in Puerto Rico in June are here.

While I do think Verisign has shown a lack of stewardship of this key public resource, I lay the primary blame for this on ICANN staff who put this forward and on ICANN board members who voted for this (it should be noted that the vote was 9-5. One of the closest in ICANN annals). As I said in Puerto Rico, shame on you. We all, all of us involved in the ICANN process in any way, owe the Internet public because of this.

It is important that we do not use this as a sign that ICANN, the idea, is failing. We should not confuse bad execution with bad strategy. The role of ICANN as an example of truly global, not International, governance is important. The role of ICANN in keeping the Internet free from government control and by that the predation of special interests is vital.

And it is a challenging environment. There is a debate inside the Registrar constituency right now, effectively re-fighting a battle that was already won, but sloppily implemented by staff. Many of you (the “you” here is our customers) will have already dealt with the end-user problems created by Go Daddy and Network Solutions in their “interpretation” of transfers policy in the name of “security”. For me this is simply deja vu.

Service providers, there is something you can do. Something important. There has been a process of GNSO reform going on inside of ICANN for the last 18 months. The GNSO is the primary policy-making body in the ICANN process. They are the ones charged with making policy for gTLDs. The board only has the power to ratify policy. Staff only has power to enforce and interpret policy.

Inside of the GNSO there has been something of a stalemate for the last few years. One of the chief reasons is that the Internet Service Providers Constituency (”ISPC”) has consistently sided with the Intellectual Property Constituency (”IPC”) on things like whois access and new gTLDs. I have been in and around the ISP industry now for 13 years and the ISPC does not look like any ISP assembly that I know.

I have been advocating change in the GNSO reform discussions. In Lisbon in March and again in Puerto Rico in June I have advocated a recasting of the ISPC. My position is that it should be a constituency for companies who stand between the “contracting parties” (ICANN-speak for Registrars) and end users. Most of the industry calls these people resellers (an old OpenSRS anachronism). They have no place or voice in the ICANN process right now and they need one. We have been trying to advocate their interests (your interests) for years. You can do a better job of it than we can.

When it comes to transfers, to whois and to most issues of DNS policy they (YOU!) are a voice that needs to be heard.

My advocating is the easy part of the battle. The harder part will be to actually have some of you folks do it. So take this as a plea to storm the ramparts! Now! In the next couple days we will post more about the ISPC, what can be done, and how to do it here. The time commitment is VERY small and the impact can be very large. Just ask George Kirikos what a little effort can accomplish in the ICANN process!

By Elliot Noss, President & CEO, Tucows

The outcry over RegisterFly has generated a lot of discussion about the regulation and oversight of registrars. (A domain name registrar is a company accredited by the Internet Corporation for Assigned Names and Numbers (ICANN) to register Internet domain names. Tucows is an accredited registrar.) In our view, much of the furor and finger pointing is missing the point. The interests of the businesses and individuals who buy domain names have been lost in this debate. There are a whole raft of existing rules and policies, defined by ICANN, that govern how the domain name registration system should work. The problem is that the people who buy domain names (formally known as registrants) are not familiar with the rules and do not know how to help themselves.

The bad news in this is that fixing how registrars are regulated and, more importantly, how the existing rules are enforced, will take some more work, especially on the part of ICANN. In the meantime, registrants need to change the way they think about who supplies them Internet services. They will need to stop focusing on price and start focusing on customer service, the services offered and increase their awareness of the rights that the existing rules give them.

Domain names are valuable intangible assets and are central to a registrant's use of the Internet. We wanted to try and help folks out by providing a set of guidelines that are intended to help registrants make good decisions for themselves. This guide is not intended to be exhaustive, but is written as if a close friend has asked us for advice. Here are the 10 questions everyone should ask a registrar before buying a domain name from them. We don’t expect registrants to necessarily dig in to all of them, but it is a place to start.

1. What is your primary business model?

This is an interesting one and needs a bit of context to explain. All major registrars used to earn money in a very similar way. They were mostly in the business of selling retail Internet services. A few, Tucows included, provided mostly wholesale Internet services to Web hosting companies and ISPs. Over time, some started to specialize in catering to large corporations who registered domains in many different countries and to other, narrower, segments. With the massive growth in direct navigation (when Internet users type their desired destination directly into the browser address bar) and the secondary market (domain owners buying and selling domains directly) things have changed. Many registrars now make more money from ads on domains in their portfolios, auctioning names and selling names in this secondary market than they do from registration fees for new domain names. Some make much more from those sources.

That is not bad in and of itself, but it might influence how they implement services like a redemption grace period.

Recommendation: Understand what business your registrar is in, and also understand who owns them and what business they are in.

2. Do you make transfers as easy as the rules allow?

Domain name portability (or “registrar transfers”) has been a source of contention in the domain registration industry from the onset of competition. For years large incumbents, at the time primarily Network Solutions the old monopoly, made it difficult for registrants to transfer their registrations to competing registrars. Since 1999, Tucows has spent thousands of people hours in both customer service and at a policy level to effect change. As a result, domain name transfer policy is now much more proscribed, much more predictable and much easier to effect.

Unfortunately, some registrars still make transferring a domain difficult. An example would be by requiring 60 days following a change of ANY contact data before a transfer can be made (another is discussed in 3 below). Thus, if you want to move to a new registrar and need to change the administrative contact email address in order to approve the transfer and do it 55 days before expiry you will not be allowed to transfer for an additional 60 days. Of course at that point your domain expired five days ago and you are at the mercy of the registrars grace period policy which often does not allow transfers only renewal of names.

Policies like this have the effect of confusing registrants and in some cases even result in people losing their names (especially if combined with short grace periods and quick triggers for auctions).

As a customer, I tend to look favorably on companies who make it easy to change services. I take that as having confidence in their ability to keep me as a customer on merit alone.

Recommendation: Understand all the rules and restrictions concerning transfers that your registrar employs. If you find them too restrictive perhaps it is a sign to keep shopping for another registrar.

3. Do you allow for easy locking/unlocking?

Domain names can be locked to ensure no changes are made to either the contact information or to the settings. This is a useful feature, however many registrars have used the locking function as a form of lock-in! They do this by locking ALL names and making the ability to unlock obscure and/or difficult. If combined with long customer service queues, limited documentation, and poor email support a domain locked by a registrar can have the effect of making changes and transfers nearly impossible.

Recommendation: Make sure you know whether your registrar locks names and if they do, how to unlock them.

4. Do you make it easy to opt-out of auto-renewals?

Auto-renew can be very useful. Well-intended registrars provide auto-renew functionality to give registrants peace-of-mind. Just “set it and forget it”. This works when the registrant is in control.

However, some registrars set all their accounts to auto-renew by default. In certain situations like monthly billing, this may be the right choice for a registrant. The problem with auto-renew comes when you don't want to renew the domain name or you want to change registrars or when it is set too early in the renewal process.

Recommendation: Find out if your registrar offers auto-renew, what their default setting is, and how to change it if you want.

5. Do you tie domains to your services?

Some registrars use domain names as a loss leader to upsell other services. There’s nothing wrong with that as long as you can easily change any and all relevant information to what you want it to be. If you want to change where your nameservers point you should be able to change them. If you want to re-point the mx record controlling your email, you should be able to.

Most importantly, does the Registrar let you change the contact information on your whois record to whatever you want? With the exception of possibly the technical contact there is no excuse for not letting you change the information on record to whatever you choose. And remember, in many respects the administrative contact is the most important contact in the mix. Make sure you set it to who you want it to be.

Historically, many web hosting companies and ISPs set all the contact information to their own and handled all of the administration for generally confused registrants. Many still do and overwhelmingly they do so appropriately. Others, however, do not.

Recommendation: Ask about and understand any restrictions on changing contact information.

6. Do you offer Whois privacy? What are your privacy policies in general?

Whois privacy is much discussed with the whole RegisterFly mess. Whois privacy is a service offered by registrars who act as an intermediary to protect the personal information required when registering a domain. And it is generally a good service some registrants will want to use. Does your registrar offer it? If they do, how much do they charge? Many registrars charge more for whois privacy than they charge for the domain name registration itself.

What are their privacy policies, and perhaps more importantly, what is their practice when enquiries are made? Registrars diverge wildly in how they treat incoming requests for information or complaints.

Recommendation: Understand what both the policies and the practices of your registrar are with respect to whois privacy and privacy policy in general.

7. What are your policies on compliance issues like litigation, ownership disputes and WDRP?

There are a number of compliance issues that can effect domain names. Does your registrar have a dedicated compliance department? Will they inform you of a dispute? Will they help you understand what your rights and responsibilities are? Recent examples, have also called into light how registrars respond to court-orders and requests from law enforcement. The practices of registrars vary widely here and are central to your ownership.

Recommendation: Know your registrar’s policies and practices with respect to compliance issues and how you contact the compliance department.

8. How easy is it to contact you?

How easy is it to find the contact information for customer support? Many online businesses focus on making it easy to buy their services but MUCH more difficult to obtain support for them.

Recommendation: Try and find the contact email addresses and phone numbers BEFORE buying.

9. What happens when my domain expires?

Every registrar has a grace period after the actual expiry of a domain name. The timing of when names “drop” is extremely important in figuring out how much room you have to make mistakes. It used to be that almost every registrar offered a 40-45 day grace period and after that an ICANN-mandated 30-day Redemption Grace Period (”RGP”). During RGP the name was more expensive to redeem (usually $100-150) and could only be redeemed by the registrant, but at least you could still get it back.

With the growth in what’s called the domain name aftermarket this has changed significantly. Fewer and fewer domain names are “dropping” or becoming available for re-registration on the open market. These days, grace periods have shortened for many registrars and what happens during this period has changed. Virtually every major registrar now either auctions names when they expire or takes the names they want from the pool of expiring names for their own portfolio (or some combination of both). The important thing to understand is how registrars do it and when do they do it.

Recommendation: Find a registrar that provides at least a 40 day grace period and that respects an actual or implied RGP for 30 days after that. In other words, you should not irrevocably lose your name for at least 70 days after the expiry date.

10. Are you a registrar or reseller?

This is often misunderstood. A registrar has been accredited by ICANN. Resellers purchase domain names from registrars for their customers.

In our view, dealing with a reseller is often preferable to dealing with a registrar directly, especially if you are buying a bundle of services like email or a web hosting package and even if you are just buying a domain name for use with services at a later date. By the way, any small business or individual will be buying a domain name to use on some level with other Internet services making the distinction between reseller and registrar somewhat artificial. What you really need to look for is a quality supplier of Internet services that you can trust and who helps make using Internet services easier.

Recommendation: If using a domain name reseller, simply make sure that you understand all of the above policies as provided by the registrar with whom they choose to do business.

Summary

The domain name business continues to change. Despite evolving business models, we believe registrant rights deserve to be front and center.

Our suggestions:

• Make sure you know how domain expirations work. Getting a domain back after it has expired is increasingly difficult and costly.
• Know how to lock and unlock your domain so you can make changes if needed. Also take a look at transfer policies, and make sure they are reasonable and easy to understand.
• Before you hand over your credit card, understand how a registrar’s auto-renew works. You should be able to stop an auto-renewal if you don’t want to hold on to a domain name.
• Make sure you’re working with a reputable registrar or reseller who is in the primary business of providing services to businesses or consumers. Make sure you can find their contact information and privacy and compliance policies.
• Ask people you trust who they use to register domain names and find out if they have ever had to have the supplier help them with problems. Often, “I use xyz and have never had a problem”, means just that, they have never had to DEAL with a problem. It is when problems arise that the difference between a good and bad supplier becomes clear.

By doing your research you may be able to protect a valuable asset - your domain name.

On August 26th, 2006, Tucows was the winning bidder in the widely discussed (Techmeme, digg.com, Stowe Boyd) eBay auction of the web-based calendar application Kiko.

Why Did We Buy Kiko?

While there are a lot of little reasons, I'll cover a few of them in a moment, there is really one big reason why we bought Kiko. We needed the functionality, quite desperately, inside of our email platform and it was going to take us a long time to get it. Especially at the level of sophistication Kiko has.

The Calendar Function

Most webmail platforms have a calendar but very few of them are ever used. It is quite simply a crappy user experience. We as users have a problem with shared calendar inside of Tucows and because we are a mixed-desktop environment we are not able to go with the expensive-frustrating-functional Exchange Server solution. At times there have been real pushes for this internally but I have pushed back and insisted that anything we do with a shared calendar be open standards. There is not much.

We all believe that a calendar is a very important function in the messaging suite for small businesses. Given that people don't want to maintain separate services for personal and business use, and because the line between personal and business services is getting blurrier, we felt this functionality was a big hole for us.

So why didn't we build it? Well the short answer is we have so many things to do in general and so many exciting things to do with email in particular that it was just not going to be possible until at least Q2 of next year and even then the plan didn't really excite anyone around here. It looked sort of like the next-gen of our current offering. Had this not come up we would have probably stayed the course and looked to catch a break. When it did, we quickly went through a simple calculus.

The Important Question

What would we pay to have a kick-ass AJAX-based calendar available now?

When I am dealing with quick, complicated decisions I really like to boil them down to a simple abstract construct. Yes there are a huge number of shadings around that question but at its simplest that is the essence of the decision. What was the value to Tucows of the time and the certainty? Of being in the market with this functionality six to twelve months earlier than otherwise? What was the value of having it be good for sure? Even if we threw it away in six months (not that we plan to do that)?



What I can tell you for certain (and you'll be able to hear more details in an upcoming podcast) is that it was more than we paid!

This Situation and Tucows

From the time the auction was announced, there was great discussion online about the value of Kiko to a buyer and much of it was both accurate and confirming. Justin and Emmett (see them being interviewed by Alan Wilensky here, here, here and here) were absolutely right in determining that Kiko was a feature not a business. We think they were absolutely right in assessing that integration with email was key and that the greatest value here was to someone with a suite of services to integrate with. We felt that this was going to be 2-3 man-years of work and they confirmed that. All of this made us more comfortable in the short period of time that we had to make our decisions.

There were also some interesting facts that were specific to Kiko that made it work for us. It was clear from their posts and such that Justin and Emmett were no longer passionate about the calendar space and were excited to do something else. They felt, and we agree, that this was worth much more with them along for the ride. Probably by a factor of ten. It would have then attracted a completely different type of buyer. We would not have paid that premium for the people. Not that they aren't worth it. Just that our financial calculus was different. This probably kept some of the natural buyers out of the process.

We also did not need a huge base of retail users. They are nice and we will provide them with a great home but if this had been much of a success outside of Mike's 53,651 it probably would have attracted more financial buyers or domainers and the price might have ended up more than we were willing to pay. It is worth noting here (and we also talk more about this in the podcast) that there was clearly interest in the domain name and the traffic. We will certainly monetize that as it is a space we know well, but we also may choose to sell the name off as it is not core for us. Either way it is another place where we, more than most/all other buyers who would be interested in the calendar functionality, will be uniquely able to take advantage of the assets.

In a nutshell, this was the kind of deal where we were buying exactly what they were selling. That makes for good business and, by the way, is too infrequently the case with Internet services.

Other Benefits

As we dug deeper there were a number of other little benefits that made this seem like a great fit and got us comfortable pushing ourselves a bit on the spend.

I will call out a few of these, but this list is not exhaustive:

Global User-base - For some the non-US customer set and things like language support may not have been seen as benefits. For us they were a very nice addition. Our business is extremely global with customers in over 110 countries. We have a large European business and a large South American business. We have plenty of customers in Asia. The customers and languages that come along with Kiko are a nice benefit for us.

Mobile Integration - Kiko has a very impressive set of mobile carriers they integrate with. We were blown away when we dug into this. It will be nice to have that functionality for the calendar. It will be even nicer to have an existence proof for making the rest of our services more mobile. We are just starting to experiment with mobile around the edges of our business and this will help things along.

Nice AJAX Implementation - Kiko is a very nice use of AJAX, especially in a lot of the underlying thinking. To me, that is not about technology, but about making a web app behave more like a desktop app. Learning how this worked within Kiko and having to maintain this code base will be very good for the rest of our services. Again, there is a nice broad application of a benefit to be taken advantage of.

Conclusion

First and foremost this was about better/faster. We were able to get a key feature done well, and done now. In my view we were lucky with a number of the small things that made this happen. The people were not part of the deal which held down value for one group of buyers. The retail user base was real but not too large, which held down value for another group of potential buyers.

There were also a number of side benefits which are important in any good deal. The global user base and language support, the mobile integration and the nice use of AJAX are three examples.

All in, we are quite excited about this, we thank Justin and Emmett for all their hard work, we look forward to giving the existing customers an ever-improving user experience and look forward to bringing a great shared calendar to the millions of end-users and thousands of partners who use Tucows services today.