Statement of Congressman John D. Dingell, Ranking Member
Committee on Energy and Commerce

SUBCOMMITTEE ON TELECOMMUNICATIONS AND THE INTERNET AND SUBCOMMITTEE ON COMMERCE, TRADE, AND CONSUMER PROTECTION
HEARING ENTITLED “ICANN INTERNET GOVERNANCE: IS IT WORKING?

September 21, 2006

Mr. Chairman, I commend you for holding this hearing on the Internet Corporation for Assigned Names and Numbers (ICANN). The Internet is critical to our national and economic security. It is also an important tool for communication and commerce worldwide.

It is ICANN’s job to ensure the many technical pieces of the Internet, from root servers to domain name registries, are coordinated and function smoothly and securely. Therefore, ICANN’s actions are a matter of deep concern to many.

ICANN continues to fall short in representing the interests of the broad Internet community. The last time this Committee held a hearing on ICANN was more than five years ago. Many serious questions were raised at that time. While ICANN has since made some progress in instituting reforms, several fairness, transparency, and accountability problems remain.

Following the creation of the Internet in the U.S., ICANN was formed in 1998 as a global non-governmental organization with guiding principles of stability, competition, bottom-up coordination, and representation. The Department of Commerce’s relationship with ICANN was under review at last year’s United Nations World Summit on the Information Society. With the bipartisan support of this Committee and the Congress, attempts to shift Internet control away from the current framework were quelled. The international community instead reached consensus on maintaining a stable and secure Internet and continuing further dialogue on Internet governance.

That said, we cannot allow U.S. interests to be put at risk by blindly ignoring ICANN’s flaws, or failing to seek improvement, for fear of global dissatisfaction. As the Department negotiates an extension of the memorandum of understanding, further reforms must be sought. ICANN remains far from a model of effective and sustainable self-governance.

Moreover, the Department should be sensitive that the manner in which the “dot-com” registry contract is renewed bears on the integrity of ICANN and the Department itself. After a legal dispute between ICANN and VeriSign, they agreed on a new contract to enable VeriSign to continue operation of the dot-com registry. ICANN’s approval of this new contract has been roundly criticized by stakeholders in the Internet community as anticompetitive and lacking in fairness, transparency, and accountability.

It appears that even though the current contract does not expire until November 2007, ICANN and VeriSign got together, off the record, agreed on a mutually-beneficial settlement to a legal dispute, and then rushed approval of a new dot-com contract changing longstanding registry policies without effectively addressing input from the broader Internet community. I have previously raised questions over the apparent lack of arms-length negotiations between ICANN and VeriSign, and I take little comfort that ICANN has apparently not changed its behavior.

The proposed contract is worrisome in part because it would remove the prospect of competitive bidding for the dot-com registry, and the better services and lower prices that may result. This change is particularly troubling since last year VeriSign lowered its registration price from $6.00 to $3.50, and implemented other improvements, when the “dot-net” registry contract was rebid.

Another problem is that under the dot-com contract, which represents by far the largest and most profitable Internet registry, VeriSign would be permitted to raise registration fees by 7 percent in four of the next six years without the justification of infrastructure investment that occurs today.

The Department must take sufficient time to review fully the implications of this arrangement. There is no need for haste. ICANN, and ultimately the Department, must ensure all registry agreements are made in a fair and open process in furtherance of ICANN’s core principles.

Our constituents may not be familiar with ICANN, but they use domain names every day and deserve assurance that their Government is doing all it can to support a secure and well-governed Internet.

I thank the witnesses for coming today, and look forward to their testimony.

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(Contact: Jodi Seth, 202-225-3641)