.nz 2LD Domain Space Consultation

DNCInternet NZ has been under pressure to release the .nz namespace. Put simply, this means that they are looking to do away with the CO in a .co.nz domain. Oh but they say the existing names will continue to work and be valid!

It therefore means that if the proposal goes ahead, my substantial investment in the domain name dennis.co.nz will be totally devalued; I will need to protect my current online IP by spending more money to secure dennis.nz; and because someone else owns dennis.org.nz, I cannot even register dennis.nz without their permission, approval or cooperation. If we never agree, neither of us will ever be able to use dennis.nz.

Now multiply this by a gazillion domain names and . . . OMG!!

And why all of this kerfuffle? Well the IT industry in NZ has been “making noises” and is “annoyed” that they can’t make more money register .nz names. Oh purr-leeez! The ramifications for this proposed change are HUGE! No, ENORMOUS! I simply couldn’t go into them all but in my eyes they need their heads read to even get it past first base.

They say that submissions are 50/50 at the moment.

The current consultation period, which is currently over half way through, has resulted in over 50 submissions to date. It is clear from the submissions received that there will not be a clear prevailing view on this topic as there is a near even division of views expressed.

Who knows what will happen but my guess is that they’ll do it, telling us that they have to or that they really should. I know that Internet NZ probably has to do this to cover their behinds but I really do get a sinking feeling and wonder if there are people in InternetNZ who like the idea. They say nice things of course that raise my hopes a little:

. . . the Board agreed that to make its decision they will need to consider the submissions made against the background of the Board’s role as acting in the best interests of the .nz domain name space. The decision would also take into account the fit with InternetNZ’s TLD and Policy Principles, RFCs 1591 and 3071 and on what the long-term strategy for .nz should be.

Oh yes, and BTW, InternetNZ may get a few million more in the coffers – BUT MONEY IS NOT THE REASON WE’RE LOOKING AT THIS, they already say! Hmmm!

Normally a pretty switched on operation with excellent policy processes, their consultation paper calls for submissions, asking some pretty direct questions like . . . Should we ABC? Should we XYZ? Sure, its early days but they don’t even give us the reasons the IT industry wants to enforce massive change and expenditure upon the New Zealand business community!

Check out these “strong” arguments FOR the proposal:

4.1 NZ Internet community
Over the past year, New Zealand’s Internet community has voiced some annoyance at
having to make .nz registrations through an approved second level domain (such as .co.nz).
During a recent InternetNZ Members’ discussion, several remarks were made about the
attractiveness of being able to register a name directly at the second level. Strong support
was expressed for such a change.

Yup. I follow your good logic there guys!

4.2 Public appetite
The general public’s views on domain names have changed. A Domain Name Commission
public opinion survey conducted in 2011, for example, found a strong preference for being
able to register yourname.nz at the second level.

Well of course!!!

• 2003 – 25%
• 2011 – 60%

And why did the other 40% not want theirs? Dumb questions get dumb results!

4.3 Influence of new gTLDs
Over the past few years there has been an increased global focus on domain name matters,
with proposals to allow new generic Top Level Domains (such as .music) being finalised. The
first applications for new gTLDs are now being received by ICANN – the international body
charged with administering the global Domain Name System.

So? And?

4.4 International best practice
A number of countries use a structure like that of the gTLDs, with approximately half of
countries undertaking registrations directly at the second level. For example, Canada now
allows registration of domain names at the second level after previously restricting these to
the third level. There are also over two dozen other countries now allowing registrations at
both the second and third levels.

And the question they asked after these pearls of Socratic wisdom?

Question 1
Should the New Zealand domain name space be extended to allow registration at the
second level, for example yourname.nz?

Whenever I get asked a binary question, especially when I am not fed the logic and facts around the question, I smell a rat. If I was thinking about technology and money alone, I too would be right behind the proposal 110% and I’d make an absolute killing! But the costs and complexities for the NZ business community far outweight the benefits as I detail in my submission.

Internet NZ, I’ll say this gently, your papers for the second round of consulation might be a little more constructive. I think you’ve dropped your usually high standards and thoroughness on this one.

My submission follows here in full:

Submission from: Dennis A. Smith
11 September 2012

1. I do NOT approve of the proposal to release the second level domain space because the costs and complexities of implementing the proposal far outweigh the few intangible benefits as presented to me thus far.
2. I DO however approve of opening the second level space substantially, both moderated and unmoderated.
3. Thus in response to Question 1 “Should the New Zealand domain name space be extended to allow registration at the second level, for example yourname.nz?” my recommendation is “No”.
4. And to Question 3 “Should new second level domains be created to cater for particular interest groups, such as .wine.nz or .sport.nz?” my recommendation is “Yes”.
5. Other topics such as any sunrise period, just and equitable allocation of contested names, dispute resolution and so on are secondary issues flowing from these two key discussion questions.
6. Should good reasons be furnished for the proposed change, I would be happy to revisit, or perhaps even alter my opinion, but I won’t hold my breath.
7. I approve of the process of consultation (both in principle and thus far in practice) undertaken by InternetNZ and the office of the DNC regarding this proposal except for one glaring omission – more on that later.
8. I would also support the continued discussion of the proposal but encourage the board to make an early call and avoid further costs, time-wasting and insecurity in the marketplace.
9. The introductory comments in the consultation paper are accurate – the proposal definitely “has the potential to significantly alter New Zealand’s domain name space”.
10. I note that the consultation paper gives four reasons for this proposed major change
a. Some people from one business sector think it is a good idea (no reasons given)
b. More people have intimated that they think it could be a good idea (no reasons given)
c. The rest of the world has progressed with some new opportunities (no obvious direct correlation to the proposal presented)
d. Other countries have implemented the same/similar policy.
11. Except for perhaps the last point (provocatively entitled “International best practice”) where there may be international precedent for good yet unspecified reason, none of these are actual reasons for the proposed change. They ARE however good reasons to DISCUSS the proposal, and I approve of the discussion.
12. In regards to the first reason given (one business sector thinks [whatever] ) a major change such as this will impact on much more than one sector of the business community. A good idea for one sector of business may not necessarily be good for another however if that one sector can sell the idea to others based on a win-win scenario, or with a cost-benefit argument, the proposal should certainly proceed.
13. The consultation paper should have given the core reasons for the proposal and has failed us in this regard. The small effort to summarise proponents’ reasons for the proposal would have assisted many to be more constructive.
14. I do look forward to seeing this sector’s detailed reasoning in due course.
15. In regards to the second suggested reason for visiting the proposal, I doubt that the questioning to gauge feedback has been thorough or professional market research. Surveys are notorious at divining low-level thought. If it was done professionally then I would want to see the methodology and questions asked in order to see how such a percentage of people agree. For example if I was asked out of the blue in the street if New Zealand should have my .nz name the same as Canada or Germany I would probably answer in the affirmative too, that is until I thought the issues through further and weighed the pros and cons. If I thought that I could get [myname].nz if I had missed out on [myname].co.nz then I would be even more positive about change.
16. In regards to the third possible justification of change, InternetNZ should consider opening up more moderated (or unmoderated) second level domains that would achieve marketing objectives maybe not in line technically, but in line strategically, without the costs, baggage and collateral of changing the core .nz structure. More on that later in this submission.
17. New Zealand has no need to follow others for the sake of following. If the issue is one of “International best practice” (which I actually doubt BTW), I would be asking the question “Well who has been on watch for the last ten or fifteen years, and why did InternetNZ not raise the issue way back when, before the entire New Zealand business community had invested in IP, marketing collateral and more?”
18. Internet NZ and its various predecessors set the regulatory and technical framework in which we all advised our clients for years. Internet NZ in particular is well recognized as a leader. They surely cannot suggest that at this late stage that it is International best practice to create massive turmoil and acknowledge their lack of forethought, planning and wisdom thus far?
19. Nope. I approve of their consultation, and discussion but I now turn to the ramifications of the proposal itself.
20. I see no real benefit to the business community from the proposal, only increased costs and complexity.
21. A primary factor in my advice to reject the first part of the proposal is that the cost-benefit analysis is heavily weighted in favour of maintaining the status quo.
22. Others can do the numbers better than me, but just measuring the costs to businesses OUTSIDE of the IT industry causes me to shake my head in disbelief. I cannot think of any reason FOR change that will stack up when looking at the turmoil and costs that will inevitably occur.
23. Turmoil per se is not the issue for me. By way of example, I now live in Samoa which is the only country in the world that has changed the side of the road on which they drive in the last 30 years. The decision to switch generated the largest protest in the history of the country and caused massive upheaval, but the cost-benefit analysis was clear and has been proven to be right, as three years later and there are more than twice the number of cars on the road and massive social and economic benefit. A basic cost-benefit analysis (that includes both financial and other types of costs) is a normal business process.
24. The proposal fails woefully for me when I do this.
25. Should the proposal proceed, no matter the spin they out on it, Internet NZ and the IT industry will cop worthy flak for simply generating additional income from the business community for no tangible benefit to the business community.
26. Unless I see good reasons that I can present to my clients in all honesty that will benefit THEM (not me, nor the industry I have worked in for decades) then I too will hold that same view.
27. I also do not relish these potential conversations with clients attempting to sell additional expenditure in the current business climate!
28. The discussion document mentions and alludes to a rapidly changing business environment in regards to domains. We all know that change is painful but inevitable.
29. Bringing additional and unwelcome expenditure and complexities to many businesses in New Zealand “could” possibly be seen as a necessary evil by most (such as the IPV6 changes are seen) IF InternetNZ gave good reasons and guaranteed no further change would be required or enforced in next decade or so.
30. But they can’t and wouldn’t.
31. While bemused that some within one business sector want to tackle the issue and have “voiced some annoyance” and are “vocal” about it, Internet NZ should take a leadership role exercising management of the .nz domain space for the greater good, not necessarily pandering to any one sector – be it international or any one local interest group or sector.
32. But I do approve of any change in the .nz space that increases choice, creates opportunities and generates benefit.
33. I believe that the second level (moderated and unmoderated) is a badly under utilised resource and I certainly empathise with many who want to create opportunity to profit from positive changes in the .nz space.
34. I suggest that the 2LD space is the more logical place to “have fun” or be creative.
35. In my opinion, current InternetNZ policy in regards to the 2LD is rigid, “poofy” and perfectly worthy of the best bureaucrats in cold-war communist Russia.
36. I have been both delighted and dismayed at the difficulty that financial institutions have had at trying to process the 2LD .bank.nz. On the one hand seeing bankers struggle to get something that they want has brought me a wry smile, yet on the other hand I cringe at the M$ mentality I observe in regards to controlling the 2LD space when the Open Source mentality has proven benefits when structured well.
37. The advantages to the entire business community of opening this space are huge.
38. My advice is to leave the .nz space as it is (all potential problems from this proposal disappear) and open up the 2LD space, letting Registrars work niche markets the same way that Telcos competed in the phone market. Create 100x 2LDs or more if you have vision.
39. I prefer a lighter more hands-off approach to moderation of the 2LD, protecting only obvious causes of error or difficulties, such as .com.nz. There is NO WAY that you will ever be able to select a few, get them right, then open up the rest and forever have made the right decision in the long term. Keep your hands off and just set the direction. Free up more and let the market find names and ways to be creative. It’s good open source thinking 101.
40. Declaration of Interests: I have been an active domain name investor and advisor to other Domainers since 1999, and have previously established and owned a Registrar company DNMSL – since deregistered.

Now if perchance Internet NZ puts the idea to bed and status quo remains, I’ll be the first one to support them and eat my hat.


Talk to you all again later . . .

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  1. Nice to see others agreeing with my basic premise that implementing .nz domain names is a recipe for pain! http://bit.ly/S12Blq

  2. Well thought out, and well presented.

    It’s going to be an expensive mess, and a waste of a lot of prior good policy and planning.

    • Thanks Dave
      It will be a massive windfall for the Domain industry, and InternetNZ. The absence of date of first registration in the process if a fundamental flaw in their thinking, so that for example in my case dennis.nz could be held up potentially forever by some Johnny-come-lately. Utter foolishness!


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