Looking at the only two members of “Ethos Capital” (ironic name)
1) CEO: A Harvard MBA with typical PE experience
2) “Chief purpose officer” - Former SVP at ICANN responsible for corporate outreach.
The structure of this stinks. I’d be not at all surprised to learn of some kind of back channel dealing.
Edit: The former (2016) CEO of ICANN registered ethoscapital.com? After ICANN he went to the former PE firm of (1) above. He is certainly involved in this now, even if not named.
Unbelievable. This heist was planned for years with money raised specifically for it. I can’t believe this is legal.
I doubt that it is. The directors of a non-profit can't wake up one morning and decided to pillage the org's resources for their benefit. They must transact their business at arm's length. Chehadé buys Donuts from Nevett, Nevett turns around and sells dot-org to Chehadé's PE firm. This looks like a kickback scheme.
PIR is headquartered in Virginia, we should be calling and writing to the Attorney General there.
I spoke with the operator at the AG's office. This is regulated through the VA Dept of Agriculture and Consumer Services. I was instructed to file an ordinary consumer complaint with VDACS and it will get escalated as appropriate.
Non-profits can operate commercially as long as that business is consistent with their charitable business. I ran a non-profit science fiction magazine. We sold magazines at a profit, or at least tried to. The problem here is that the leadership of PIR transferred their assets in a way that appears to enrich the same.
They can, so long as commercially means operating at a surplus (keeping the profit to use later) rather than distributing profits (giving out the profit).
This is one of those situations that really encapsulates the essence of IP for me: There is something virtual (the .org tld) that comes with legally enforced scarcity and a monopoly that governs it. And some guys realize that you can acquire this monopoly cheaply, and milk it for massive profit, at the expense of millions of people. It's not even like there's some investment that needs to be done, some new fancy tech around tld's that need to be funded - it's just a plain as day money-grab, rent-seeking in its most obvious form.
My understanding is that running resolvers at the kind of scale they need to handle attacks is actually difficult and expensive. The registries themselves are just a couple of machines with databases on them.
Maintaining namespaces is just hard and the DNS, with groups of people running TLDs, is the best we’ve come up with so far. I personally thought namecoin was a creative alternative and I’m a little disappointed it hasn’t become more popular but until something like that does we’re going to continue seeing things like this.
> DNS, with groups of people running TLDs, is the best we’ve come up with so far.
Is it? I'm not very familiar with the domain, so I'm actually asking. Generally, I'm very cautious when someone says that current state of affairs is the best we have come up with, because it doesn't acknowledge the inertia to keep things as they are.
No, there are properly decentralised domain name projects like namecoin which uses blockchain to control ownership of domains and zone edits in a more secure way.
There are a few other projects that decentralise domains and fix security issues, but our current federated system has become a heavily established billion dollar industry and the people in control of it have no incentive to give up that control.
Any move to a new system will have to come from end users who don't know there are issues, and don't care enough to spend the effort understanding the issue and solution.
As if a den of evangelical blockchain shills would run the domain name system any more ethically, responsibly, and transparently than the current bunch of old school shysters running it, if only they'd hand over the reigns of control to the new blockchain shysters and make them God. Slapping the "blockchain" buzzword on everything doesn't solve any problems, it just makes you look like yet another con-man.
>Based on all the empirical evidence we present,
we are left to conclude that the Namecoin ecosystem is dysfunctional. The vast majority of registered names represent squatting and there is little
evidence of a secondary market for names. While
there could be many factors that explain the lack
of adoption, there appears to be clear room for improvements in the design to minimize squatting and
other problems. To this end, in Section 6, we explore the design space of decentralized namespaces
and make recommendations.
>Cointelegraph: You used to be one of Namecoin's biggest cheerleaders. What happened?
>Michael Dean: So here's my opinion, which is really going to get me hated, but I think Namecoin as a decentralized DNS-type system is dead.
>[...] The biggest flaw is the clunky wallet that takes ten minutes to open. The other biggest flaw is that the near-zero expense of registering domains encouraged domain squatting. All the good names are taken. Someone registered every noun in the dictionary as Dot-Bit.
>And these squatters didn't even do it right. When you go to any of these squatted domains, they don't go to a place holder with a page that says "to buy your site in Dot-Bit, email me here and make me an offer." The sites just don't resolve! These people are unclear on the semi-scummy concept of domain squatting. In Namecoin, even that gets done wrong!
>Also, Dot-Bit is actually vulnerable to a hostile takeover from ICANN. If ICANN decided to support Dot-Bit and decide where things would resolve contrary to where the Namecoin wallet was resolving things, and corporate DNS servers sided with the ICANN (which they largely would), it would create consumer confidence chaos with the Namecoin system.
I'm not an advocate for blockchain it has only one very narrow use case global distributed consensus on ownership of a virtual token that's perfect for money and domain names and nothing else.
I'm sorry if you bought some flim flam mans marketing spin but I only ever look at the tech.
All of these issues with people not using their domains just backs up my argument, that people don't care enough to use it, hell even the squatters don't care enough to use it.
Ultimately ICANN could have given them the TLD but didn't because they have no incentive to give up that control.
Thank you for backing up my argument with links :)
>I'm sorry if you bought some flim flam mans marketing spin but I only ever look at the tech.
What made you think I believed any bullshit, or that I'm evangelizing? What company did I endorse? And the links prove you're evangelizing Namecoin as a "properly decentralised domain name project", but it's actually a complete failure, which you conveniently neglected to mention. Your statements are the exact opposite of the truth. Speak for youself, and stop projecting.
You claimed that Namecoin was "properly decentralised" and "uses blockchain to control ownership of domains and zone edits in a more secure way". Yeah, all 28 domains in use. You're the one evangelizing a spectacular failure.
> You claimed that Namecoin was "properly decentralised" and "uses blockchain to control ownership of domains and zone edits in a more secure way". Yeah, all 28 domains in use.
Yes that was my argument, we are both in agreement why are you so upset?
I'm not at all upset (and you're projecting again) -- I'm being sarcastic, and it whooshed right over your head. Look up: All 28 domains. Why didn't you point out what a failure it was in your argument (which has already been severely downvoted), unless you were being disingenuous when you evangelized Namecoin as a properly decentralised more secure solution, and not a failed improper insecure vulnerable dead dysfunctional boondoggle, as my quotes and citations proved?
I mention namecoin as a single example of decentralised dns and mention that there are other projects (thats not advocating or evangelising namecoin).
I then point out the major problem with all of these alternative dns, no one uses them because few have incentive to do so.
You responded by calling me a con-man (sounds reasonable) because I had the audacity to mention a technology in one of the only use case's its good at.
> I'm not at all upset (and you're projecting again) -- I'm being sarcastic, and it whooshed right over your head.
I got the sarcasm, I got the name calling, it's childish. If I got more upvotes would you consider my words instead of the con-man image you are projecting? I don't think so.
Handshake (https://handshake.org/) is another attempt at a decentralized domain name system. It’s compatible with the old system so I’m more hopeful that it can gain some adoption. Let’s see.
> Surely resolvers for a TLD with 100K domains and 1MM lookups per day are cheaper to run than those with 100MM domains and 1BB lookups per day.
This on the face of it sounds reasonable, but the cost difference is likely marginal.
If you're going to provide a highly available DDoS resistant infrastructure to deal with a large scale of customers, the majority of the costs are going to come from building that distributed infrastructure across many parts of the world.
The costs may go up between 1 million lookups vs 1 billion lookups, but if there is an increase, the order of increase will be closer to 10x than it is 1000x.
Can confirm. Our TLDs scaled by about two orders of magnitude in total registration number following our launch of .app, but the associated costs that rose were very marginal. Most of the cost is not strictly related to volume.
The increase in cost is sufficiently sub-linear that the cost of each new .org registration should be going down as the number of them goes up, if it was truly run for public benefit while breaking even.
As another comment says, most of the cost will be in building and maintaining a robust, scalable, attack-resistant distributed system. The linear scaling costs (such as bandwidth and processors) will be small in comparison.
(Of course at much higher numbers, mathematically O(N) starts to dominate again, but 1 billion lookups per day isn't enough for that.)
Already in 2015, Emily Taylor warned [1] that ICANN could become the Internet's FIFA -- a small organization with great power that doesn't answer to any government. Here we are. A private company run by former ICANN people will be given the right to collect massive rent from a locked-in client base on a public resource.
It was already obvious in the 2000's the analogy with FIFFA is a good one as its the some of the playbook ICANT are using holding meetings in out of the way places and leveraging small countries to maintain power.
BTW I was a member of poptel who owned the .coop registry.
> Vint Cerf, former Chairman of the Board of ICANN and founding President of the Internet Society, said in a statement: “When the Internet Society won the bid to operate the .ORG registry, it enabled a productive and sustainable future for the organisation. Public Interest Registry exercised its stewardship to the benefit of the registrants and the Internet Society’s mission. I am looking forward to supporting Ethos Capital and PIR in any way I can as they continue to expand the utility of the .ORG top-level domain in creative and socially responsible ways.”
And then an outline of what "expand" might mean in that context:
> Going forward, PIR and Ethos Capital are planning to launch several new initiatives aimed at promoting and supporting the .ORG Community, including: Establishing a Stewardship Council that will serve to uphold PIR’s core founding values and provide support through a variety of community programs; Launching a Community Enablement Fund to support the financing of current and additional initiatives undertaken by key Internet organisations; and Expanding a program to award .ORG prizes to promote the success and positive impact of non-profit organisations.
Which is surely the most transparent flimflam imaginable and which anybody in the business world would interpret as doing absolutely nothing at all. /s I can't wait to see the fabulous prizes /s...
> and Expanding a program to award .ORG prizes to promote the success and positive impact of non-profit organisations.
WTF?
So, non-profits collect donations from people who want to support their respective missions, and now these scammers come along and want to use a monopoly to redistribute those donations based on what they think who the donations should go to, and then even want to be recognized for their "work" of forcing the redistribution of donations?
If there is one thing the .org registry could do to "promote the success and positive impact of non-profit organisations", then that would be to optimize their business as much as possible and offer the cheapest domain registrations on the market, so that non-profits can keep as much of their money as possible to spend on their core mission.
Even these bullshit "promises" would still be blatant corruption, you really have to wonder how much of a moron Vint Cerf is for not seeing that.
Jokes aside, this sort of stuff is complicated. Seen from Vint Cerf's position it might sound legitimate. Certainly some form of reorganization which might collect more funding for development and maintenance of the internet in the public interest wouldn't by itself be bad on its face.
It wouldn't be the first time some up-in-the-clouds authority had too much trust in their friends and colleagues that what they were up-to was actually kosher and, as a result, carelessly dispensed with the required ritual corporate-speak niceties only to suffer embarrassment later.
You should also keep in mind that any time you see someone quoted in a press release there is a very high chance that the press release author wrote the quote. It's the norm to suggest copy and pass it over for approval. Some people have their staff accept boring pap like that from friendly organizations without ever seeing it themselves.
I personally never let someone write a quote for me and I found that this turned me into a nuisance... but lots of people do (presumably they don't like being nuisances!). I think they deserve what they get for it, but understanding what might have happened can make it more explicable if not more excusable.
Yes, like politicians that spend their careers compromising on every issue to keep in office, so they can press their serious issue they care about. And find a 20-year career has passed and they never did it.
People live one day, one decision at a time. Without a clear 'mission statement' and a clear knowledge of the risk carried by each decision, we all tend to be very conservative. Which means, support the status quo for now in hope of better change in the future. Which might never come.
The "Privacy may actually be an anomaly", defender of Google's Project Maven, Google/Verizon "Wireless services are exempt from Net Neutrality" deal Vint Cerf?
It doesn’t really matter how benevolent the intentions of Ethos Capital are, the control of a public commons like .ORG has to be held to the highest standards.
With the amount of negative PR already generated by the proposed move, it’s hard to see a way forward for ICANN that is untainted.
It is not at all unlike what is captured by the phrase: justice has to be seen to be done.
> As of Saturday, October 1, the federal National Telecommunications and Information Administration no longer exercises control over the Internet Corporation for Assigned Names and Numbers (ICANN)
> Instead, as an autonomous not for profit organization, ICANN will now answer to international stakeholders across the internet community, including a governmental advisory committee, a technical committee, industry committee, internet users, and telecommunications experts.
> From its founding to the present, ICANN has been formally organized as a nonprofit corporation "for charitable and public purposes" under the California Nonprofit Public Benefit Corporation Law. It is managed by a 16-member board of directors composed of eight members selected by a nominating committee on which all the constituencies of ICANN are represented; six representatives of its Supporting Organizations, sub-groups that deal with specific sections of the policies under ICANN's purview; an at-large seat filled by an at-large organization; and the President / CEO, appointed by the board
> There are currently three supporting organizations: the Generic Names Supporting Organization (GNSO) deals with policy making on generic top-level domains (gTLDs); the Country Code Names Supporting Organization (ccNSO) deals with policy making on country-code top-level domains (ccTLDs); the Address Supporting Organization (ASO) deals with policy making on IP addresses.
So yes, the State Of California has jurisdiction but no control. AFAIK California has no power to intervene in the internal affairs of any corporation if they keep the law and while this whole thing stinks, I doubt it broke any laws.
There was a very brief attempt by early ICANN to pretend like it was an internet user's organization and would respond to general votes from just about all users of the internet through representative proxies. Unfortunately that scheme seemed to have just been marketing and they very quickly dropped it. It bought a lot of nerd favor for the early ICANN, but yet they've never really fulfilled any of the original promises.
There are several indications that there could have been laws broken. There is certainly enough for several agencies to start investigations over and at least block the sale until the investigations are completed
It seems like this presents an opportunity to establish a decentralized alternative registry, initially populated with .org domains acquired prior to some reasonable point in the past.
I guess after .org scandal it's will be much harder for ICANN to take control away from Verisign under guise of some anti-monopolistic practices. On other hand they already make tons of money from control of their domain zones and since they are public company they'll less likely try to pull of something ugly.
VeriSign wants price caps removed like .ORG managed. They are salivating. Their fingerprints were all over removing price caps for .ORG. Those same lobbyists are still involved now at ICANN in the groups, subverting the public interest. I wrote about it originally here when I made a case for ICANN being captured: https://reviewsignal.com/blog/2019/06/24/the-case-for-regula...
Seize the means of registration. Seriously, why on earth are the domain registries of the world not in the hands of the people? This stuff is far to important to be under the control of cooperations.
You may want to look into OpenNIC, in which anyone with the know-how can operate a TLD.
They have domains like .geek, .cyb, .null, .libre, .oss, and you use them by simply switching your DNS server to one of OpenNIC's mirrors. They also support TLDs for "emerging nations" like .ku for Kurdish people, .uu for Uigurs, .ti for Tibet.
Though I'm not sure what would happen if ICANN decides to sell one of those domains one day.
This doesn't really work. There are other stakeholders than just "the public", so need to add more to it, and because of this inherent complexity it ends up sucking. (see Athenian Democracy)
As someone noted in a previous discussion, if governments get involved things will get messy, as just one example imagine China objecting to issuing/renewing a domain for a Taiwanese or Hong Kong NGO..
Which fed? ICANN is an international organization. They used to be overseen by the US Department of Commerce, but that relationship ended (with some controversy) a few years ago.
Any fed of sufficient size and diplomacy. US, EU, whatever. Anyone who has an iota of accountability, internal or external, would be better than the current owner.
I don’t understand. Does this mean that my existing .org registration will likely become more expensive at any arbitrary rate, and I have to pay the high fees or lose it?
How do I stop this from occurring?
Typically endowment, programmatic expenses, and operational overhead are the big three. You might also see a reserve (emergency) fund or a capital campaign.
If you a interested, in the details of any given 501c3 look for the tax form “990”. It’s where the 501c3 report income, governance, and expenditure out to the IRS. Any nonprofit worth their salt will have a copy published on their website. They typically run 2, 3 years behind the calendar year, so right now expect 2017.
It's described in that article as "a deal to acquire the 501c3 non-profit" -- won't the 501c3 no longer exist independently after being acquired by a for-profit? So it won't have any endowments or capital campaigns, and won't file any 990s anymore.
Googling in general, it seems that when 501-c-3's cease to exist, any assets they had end up being donated to some other existing 501c3, as decided by the 501c3 board. (I am sure some amount of bonuses to salaried staff can also happen, but probably not a significant proportion of a $1 billion acquisition price, without seeming illegal).
$1 billion is a pretty big number. Still curious where $1 billion paid to acquire PIR will end up going. Obviously existing 990s for past fiscal years from PIR won't tell us that (even less so existing 990s from ICANN, which I don't think is involved in ownership of PIR or a party to the transaction at all?).
> In November 2019, the Public Interest Registry (PIR) was sold by its initial owner, the Internet Society, to investment firm Ethos Capital for an undisclosed amount. The PIR also announced it would abandon its non-profit status to become a B Corporation.
So, it seem like they plan to forgo their nonprofit status to became a for-profit company?
Nice to see this much interest; sadly it's not clear what to do. Thanks bhickey for the pointers below to the VA AG and IRS.
I'll try to keep that blog post up to date. Today: PIR posted an official response -- low on content, no additional redeeming tidbits.
https://www.keypointsabout.org/
Tellingly, they do not once mention the word "endowment" or derisking [for ISOC]... which seemed like the one plausible argument in favor of this move: ISOC sacrificing the public registry for the rest of its mission.
"Backroom deals at a organisation that used to be governed by the US will probably be used to extort wikipedia for $100000 to keep the address wikipedia.org. The same extortion will be aimed at unicef.org, (add list of common .orgs here)"
That isn't alien language, and whilst not strictly true, it isn't stretching the truth more than the news already does habitually.
We the internet absolutely need a decentralized way to manage internet names that replaces the centralized ICANN. That is the only way to avoid these types of corruption.
ICANN is the biggest legalized mafia today! The domainers (just like Bitcoin junkies) are the worst human material. When it comes to domains, imagine yourself not paying your phone bill on time, and in 30 days it goes on an auction and your competitors buys it and routes all calls to their sales team - that's what GoDaddy and most registrars do today employed by the crooks at ICANN! This has to stop! Don't just stop at .org, wipe out all the assholes at ICANN!
Can someone put together a competitive bid and turn `.org` itself into a non-profit corporation? That sounds like the way to go in order to protect `.org` in the future.
I think that by being acquired and now having owners and stakeholders, PIR is no longer a non-profit corporation. Their own press-release state they will consider seeking B Corporation certification.
My proposal: assign the management of the old core generic top-level domains to the United Nations. Raise the price to maybe $50 per domain. This will make domain hoarders/squatters unregister millions of domains. Use the money collected for the benefit of mankind (earmark the money).
Then you've effectively made it impossible for certain people to buy a domain name. And I wouldn't really trust that UN would be the best beneficiary of such money, it's bureaucratic hell.
People that cannot afford $50/year for a .com/.net/.org domain name can choose a cheaper tld. For some poor countries owning such a domain for your business would signal commitment - a good thing.
Yes, UN is a bureaucratic hell but I see no other existing option.
Domain names are not a scarce resource, there's no need to put the bar so high. As far as I can tell the current system with the current pricing seems to work just fine, why not continue that way?
They are, though, since each domain can only point to one server (per RR type). Or at least meaningful ones are, but if you're okay with a random meaningless string of characters rather than something memorable then it doesn't really matter whether it's under any particular TLD. Moreover, when it comes to .org domains the money you're paying for registration is supposed to cover some background checks to verify that the buyer is really a non-profit organization and not some scammer, to maintain the reputation and integrity of the .org TLD. That takes labor, and labor is a scarce resource.
Why should I, who have had my personal domain for 15 years, using multiple email addresses, websites, and dynamic DNS back to my home router, be forced to move to a "cheaper" TLD?
Gentrification comes to the internet. No thank you.
Why should these TLDs be exclusive for certain people, even more so if they're going to be managed by some kind of global entity?
You see no other existing options because the premise is to raise the cost significantly and make it unavailable for most people. It clearly doens't have to be that way. And you don't solve anything by funneling that money into an extremely inefficient organization.
Keep the current system, as it seems to be working well. There are other ways to stop domain squatters, like not letting them abuse the registrar status to hold domains without paying for them.
Some kind of price scale would work well to allow individuals easy assess while discouraging hoarding. E.g
First domain $3/yr
Second $8/yr
Third $20/yr
...etc
No idea how you could track/enforce this. Make domains tied to an individual or company type thing. Shelf companies would add too much cost to have one per few domains I imagine.
Each country would have a given amount of vouchers say one per ten person to start and presumably only one individual could redeem them for the rebate otherwise its 50$ per month.
Your proposal against what? I don't see how your proposal solves any problems relevant to the article, unless extorting money from domain holders is exactly what you want. The most obvious solution to the discussed problem would be to not raise prices and hold those at ICANN, ISOC, PIR, etc. to account.
This outcome is worse than any of the 'worst-case' scenarios hypothesized by the ICA when they filed their open letter of complaint in May when the price cap was listed. In hindsight, why would ICANN classify .org (with its enormous base and community) the way it does new TLDs?
Would ICANN have any recourse if, after allowing this sale, the established registry dramatically raised prices?
We need a NameCoin rewrite, preferably based on Algorand (for energy efficiency). And perhaps a rent-oriented namespace instead of a buying oriented one. If a sybil-free system can be erected, every host would be renting namespace from the public, as it is a burden for the public to have to memorize more complicated strings for their actual favourite sites.
ethereum is based on Proof of Work, so can not be as efficient as consensus algorithms designed to not require PoW (like Algorand, which has the clearest mathematical / algoritmic underpinning / proof under a very strong attack model, if you know of others, I would certainly be interested)
Very disputable. They haven't made the .org tld, it wasn't a private resource (read: private as in used to generate profit), they just captured it and turned it into private property.
1) CEO: A Harvard MBA with typical PE experience
2) “Chief purpose officer” - Former SVP at ICANN responsible for corporate outreach.
The structure of this stinks. I’d be not at all surprised to learn of some kind of back channel dealing.
Edit: The former (2016) CEO of ICANN registered ethoscapital.com? After ICANN he went to the former PE firm of (1) above. He is certainly involved in this now, even if not named.
Unbelievable. This heist was planned for years with money raised specifically for it. I can’t believe this is legal.