From: Vishal Dutta MCP 1/2 MCSE <[email-masked]>
Date: Wed, 28 Oct 1998 22:15:06 -0500 (EST)

Vishal Dutta-MCP
 1/2 MCSE

For Immediate Release: 
October 20, 1998 

CONTACT: Salianne Fortunato 
(202) 482-7002 

**** MEDIA ADVISORY ****
For your information, Becky Burr, Associate Administrator of NTIA for
International Affairs sent the following letter to the Internet
Corporation for Assigned Names and Numbers: 

October 20, 1998

Dr. Herb Schorr, Executive Director 
USC Information Sciences Institute 
4676 Admiralty Way 
Suite 1001 
Marina del Rey, California 90292-6601 

Re: Internet Corporation for Assigned Names and Numbers (ICANN) 

Dear Dr. Schorr: 

On October 2, 1998, the Internet Assigned Numbers Authority (IANA) made a
submission on behalf of the Internet Corporation for Assigned Names and
Numbers (ICANN)(1) 

in response to the National Telecommunications and Information
Administration (NTIA) Statement of Policy entitled "Management of Internet
Names and Addresses," 63 Fed. Reg. 31741 (June 5, 1998) (hereinafter the
"Statement of Policy" or "White Paper"). The White Paper invited the
private sector to come together and form a new, not-for-profit corporation
to administer policy for the Internet name and address system (the "domain
name system" or "DNS"). 

Based on a review of ICANN's submission, other public submissions, and on
public comments on those submissions, the Department of Commerce regards
the ICANN submission as a significant step towards privatizing management
of the domain name system. Overall, the submissions we received supported
moving forward with the ICANN structure. We note, however, that the public
comments received on the ICANN submission reflect significant concerns
about substantive and operational aspects of ICANN. We strongly recommend
that you review and consider the many thoughtful and constructive comments
posted at www.ntia.doc.gov. The submissions of the Boston Working Group
and the Open Root Server Confederation, among others, articulate specific
concerns, many of which we share. As you refine your proposal, we urge you
to consult with these groups and others who commented critically on your
proposal to try to broaden the consensus. 

The White Paper contemplates that the United States would enter into an
agreement based on the principles of stability, competition, private
bottom-up coordination and representation. The public submissions and
comments indicate that there are remaining concerns in the area of
accountability (representational and financial), transparent
decision-making processes, conflict of interest, and ICANN's proposed role
with respect to country-code top level domains (ccTLDs). These concerns
are described below in greater detail. 

Under your submission, the Interim board is encouraged but not required to
establish an open membership structure. Many commenters expressed the view
that the principles of private, bottom-up coordination and representation
set out in the White Paper are unlikely to be achieved in the absence of
some type of membership-based structure. We believe ICANN should resolve
this issue in a way that ensures greater accountability of the board of
directors to the Internet community. 

Commenters also pointed out that the ICANN submission does not describe a
mechanism to ensure financial accountability to the members of the
Internet community who will be funding the organization. The absence of
transparency and controls in the budget process could impose unnecessary
burdens on Internet users and endanger the long term viability of ICANN
and thus the stability of the Internet. We are interested in knowing how
you plan to address these concerns. 

The White Paper envisions that the United States would enter into an
agreement with a corporation that is governed on the basis of a sound and
transparent decision-making process, which protects against capture by a
self-interested faction. Commenters applauded your decision to provide
notice of and seek public comment on any policies that substantially
affect the operation of the Internet or third parties. But many
submissions urged that the Board also regularly explain decisions that do
not reach the level of "substantially affecting the interests of the
Internet or third parties," suggesting, for example, that such
explanations could be included in promptly published minutes of the board
and other decision-making meetings. 

In general, commenters emphasized the importance of establishing and
guaranteeing open and transparent processes and avoiding the appearance of
conflicts of interests with respect to the supporting organizations
described in the ICANN proposal. For example, some commenters suggested
that a system that permits officers and employees of the supporting
organizations to serve on the ICANN board of directors threatens the
independence of the board and should, accordingly, be prohibited. 

The White Paper indicates that the United States is prepared to enter into
an agreement with an organization that reflects the geographic and
functional diversity of the Internet community. A number of commenters
expressed concern about the proposed interim board of directors and called
for the establishment of mechanisms to ensure equitable representation of
the Internet community, including developing regions, based on a
transparent and democratic election process. We are interested in hearing
how ICANN intends to address these concerns as additional interim board
members are selected and as the process for electing the permanent board
is adopted. 

One final issue raised relates to our assumption that national governments
would continue to have authority to manage and/or establish policy for
their own ccTLDs (except, of course, insofar as such policies adversely
affect universal connectivity on the Internet). The ICANN submission,
however, is silent with respect to ccTLD management, and we would
appreciate an elaboration as to ICANN's intentions in this area. 

We hope that ICANN is prepared to address the concerns listed above in a
manner that is consistent with the principles of stability, competition,
bottom-up coordination and representation. The United States intends to
move carefully but expeditiously to privatize DNS management. We therefore
look forward to hearing ICANN's response to the concerns expressed during
the recently completed comment period, and to meeting with you to discuss
these issues. Assuming that the concerns described can be resolved
satisfactorily, we would then like to begin work on a transition agreement
between the United States and ICANN. In keeping with our commitment to the
principles of openness and transparency, we plan to continue to facilitate
public participation in the transition process. 

Sincerely, 

J. Beckwith Burr 

Associate Administrator (Acting) 

1. You state in your letter of October 2nd, that ICANN has been formally
incorporated but has not elected a board of directors or adopted bylaws.
Our response should not be construed as either approval or disapproval of
the bylaws as presented or of the proposed composition of the interim
board of directors.