There are issues that require careful thought and well thought out
solutions if proposals for cross-subsidisation of parts of the .au DNS
are to be taken seriously.

The proposal appears to be that:

 "some users of the .au DNS (i.e. entities who are running 'for-profit'
businesses) subsidise some other users of the DNS (i.e. non-profit
organisations and individuals) by paying the total costs of some parts
of the .au DNS (i.e. the Registry and the Regulatory components)"

Over the years I've publicly supported similar concepts,  generally on
the basis that the total cost of those two parts of the domain name area
aren't hugely significant when allocated over the total number of
'for-profit' users.

However, I believe that cross-subsidisation is only possible if its
proponents are willing to seriously address a number of major issues.
There's been no indication so far on this list that the necessary rigour
is likely to be applied to the problem.


Here are some of the issues that need to be resolved:


1. ETHICAL ISSUES
a) Included in the non-profit category are many organisations with
substantial, and sometimes almost unlimited resources.  For example,
many industry associations (e.g. things like the Association of
Superannuation Funds of Australia www.asfa.asn.au)  have access to far
more resources than about 500,000 small Australian businesses. Or see
www.horizon.org.   Not to mention the fact that many individuals have
greater resources than SMEs.  I certainly don't want my small company
subsiding the costs of Kerry Packer if he wants to register a personal
domain name in id.au.  Do you?  So, is it ethical to expect hardworking
Australian SMEs to subsidise entities (even if technically non-profit)
with far greater resources.   

b) In the long term, there may be far more domain names in the
non-profit and individual category than there are in the for-profit
category.  After all, there are more individuals than for-profit
companies in Australia; in the longer term many will have their own
domain name.  Is it ethical to expect the minority of domain name users
to subsidise the majority?


2. ELIGIBILITY RULES
a) What eligibility criteria are to be used to determine what entities
are eligible for these subsidized areas.  The criteria should be:

 i) Objective not subjective
 ii) Preferably externally set - e.g. something like 'any entity which
is classified as non-profit by the ATO'
 iii) Preferably easy to verify as part of the domain name approval /
rejection process 

Note:  The existing org.au 2LD is NOT solely for non-profit
organisations.  It never has been.  The following quote is from Robert
Elz (and he should know, since he's been approving the org.au domain
name applications since the beginning of Australian internet time):

"ORG.AU is going to need some care if you start making classifications
based upon domain names - it has never been a domain for non-profit
organisations (it isn't .ORG), it was, and remains, a domain for
organisations that fit no-where else, or don't do so reasonably, and has
gov types, for-profit types, educational types, and non-profit types of
registrations." 

b) What verification / enforcement process will take place at domain
name approval / renewal time?

c) What will happen if an entity no-longer meets the criteria?
For example, there are many instances of entities that were once
non-profit, that are now for-profit.  Hmmm, why do I keep thinking
'Telstra'?  What will happen to these entities?  Will they be kicked out
of the non-profit 2LD if they no longer meet the criteria, and forced to
change their domain name - with all the associated costs and marketing?
You're not proposing to leave a for-profit company in a non-profit area
where they don't have to pay domain name fees, are you?

Both b) and c) must be strictly enforced.  If for-profit companies
remain in the non-profit area for the long term paying no fees, that
will undermine support for subsidies.  So there must be some real
integrity in the way the eligibility requirements are applied.  More
integrity than has been applied to date in the existing 2LDs, which
include all kinds of 'exceptions' that wouldn't pass a consistently and
rigorously applied set of policies.

LIABILITY AND DISPUTE ISSUES
a)  What liability cover will the volunteer operators have when
something goes wrong - e.g. if they don't renew a domain name because
the entity is now for-profit, and they get taken to court?  Note that
Robert Elz handles this with a very elegant solution - 'well, I have no
assets, so sue me'.  Other volunteers putting their name down to help
may not be as comfortable using this line of defence.

b) What Dispute Resolution procedures will apply?
And please, lets not have any pretensions that there won't be disputes
between non-profit organisations.  Remember the very public spat a
couple of years ago when two non-profits (I think it was the Royal Blind
Society and the Guide Dog Association) fought publicly like cats in a
sack (dogs in a sack?) about which of them owned the rights to
'seeing-eye dog'?



There are probably some other equally major issues that need to be
addressed, but these will do nicely for starters.

If people want to move the proposal on from the "gee, wouldn't it be
nice" stage, then a document setting out the detailed solutions to the
above is necessary.  Actually, I suggest that proponents of a
non-charging area of the .au namespace do the following:

Rather than worrying about the existing 2LDs, you should submit a
proposal to auDA to create a new 2LD under .au, specifically for the
category you want - perhaps nom.au for personal domain names, or
somethingelse.au for non-profit organisations.  As part of that
submission you'll need to document your solution for all the issues I've
raised above, but hey - if you can't find a solution for a new 2LD, then
you haven't got one for the existing 2LDs.

Creating a new 2LD will avoid all the 'data integrity' problems with the
existing areas such as org.au that include all sorts of entities
including (according to Robert Elz) for-profit organisations.  auDA's
competition model report (which, of course, you have all read) allows
for a new registry to service a new 2LD, so include in your proposal
that you will create (volunteer labour using open-source code I presume)
a new registry to operate this new 'fee-less' 2LD.

Knock on some doors and find a sponsor who will kick in the $15k or so
that will cover auDA's fee charged cover their costs from the regulatory
side.  Or run some cake stalls.


In summary, if anyone wants a cross-subsidisation proposal to be taken
seriously:

1. Deal with the ethical issues:
a)  Is it acceptable that Australian SMEs with domain names subsidise
the costs of some far better resourced non-profits and individuals who
have a domain name?
b)  Is it acceptable that a majority of domain name owners may end up
being subsidised by a minority?

2. Deal with the eligibility issues:
a)  What eligibility criteria will apply?
b)  What process will be followed to ensure those criteria are met?
c)  What process will apply to entities that have domain names but
either never met, or now don't meet, the criteria

3. Deal with the dispute resolution & liability issues:
a) What will the volunteers who operate the system do when they are sued
for not approving, or not renewing, or revoking a domain name?
b) What will the volunteers do about dispute resolution.

4. Put it all together in a submission to auDA for a new 2LD.


On a personal level, I may support a really well thought-out proposal
for a subsidised area of the .au domain namespace.  I'll definitely heap
derision on half-baked ones.


Regards,  Mark


Mark Hughes
Effective Business Applications Pty Ltd
effectivebusiness§pplications.com.au
+61 4 1374 3959
www.pplications.com.au

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