Getting inside the domain of a megabucks business

WIRED:IT'S A PRIVATE company with a government-granted monopoly, where the monopoly is global and the government is the United States. It's about to switch CEOs, in the middle of a complex negotiation that almost no one (including that US government) is happy with, but will still pull in about $350 million of nearly pure profit.

One of the key parts of this deal will involve participants, each of whom has paid a $185,000 fee, to attempt to click a button on a web page at exactly the right moment, an entirely artificial game of skill that the organisation calls “digital archery”.

Oh, and this company is in charge of the most vital centralised parts of the entire internet.

Welcome to the strange world of the Internet Corporation for Assigned Names and Numbers, or Icann.

Icann is the odd institution seated in the middle of the Net since October 1998. Its job was to tactfully replace a process that had been largely managed by a technocracy of internet engineers, but which the US government was concerned might move out of US control.

The process itself is not insanely difficult. Its job is primarily to act as the final authority for who has what domain online.

It’s not a hard job, but unlike most internet systems, the procedure does require a central authority. For domain names, the buck stops at Icann. Unfortunately, perhaps, for internet governance, a lot of bucks stop at Icann.

While the private company doesn’t offer much in the way of paid-for services, it does have to be self-supporting. And while it doesn’t do much itself, plenty of other private companies depend on the world that Icann manages.

Domain name registrars and registries, the organisations that sell you domain names, and run the “top level domains”, such as .com, .org, and .ie, all work within the rules that Icann manages.

With more than 140 million domains in use, and with most registrars charging $10 to $30 fees for registering or renewing those domains, a large and profitable private market exists, almost entirely at the whim of Icann.

It’s the biggest imaginary market in the world outside of the financial industry. When you buy a domain, the company you buy it from – be it Go Daddy or the IE Domain Registry (the company the Irish Government uses to manage .ie) – takes your money to essentially fill in your name and address in a virtual document.

A chain of responsibility takes a cut of that cash, until eventually a small amount ends up in Icann’s pockets.

Naturally, everybody involved in the transaction has a vested interest in keeping the system working the way it does.

The biggest change in this system is currently in progress. Up until now, while anyone could buy a domain name, only a few institutions had control of the top-level domains. Each country has one, and, due to a historical quirk, there were a handful of “generic top-level domains”, like .com, .org, and .net.

Icann intends to change that, and is now taking proposals for nearly 2,000 new generic top level domains. The domains vary from the predictable to the random. Google wants .search, Apple wants .apple, and Amazon wants .author. Hasbro wants .transformers but nothing else. Four separate companies want .tennis and a small Gibraltar company wants .win.

Each of the 1,100 companies listed have paid $185,000 to take part in this beauty contest. Each of them really does have to bounce on a “click me” button to decide which of four timed batches they will participate in.

Icann announced the competitors for the new domains last week month in what they called “reveal day”.

However, they revealed slightly more than they intended, including unredacted personal and security details of the bidders.

That followed a month when new entries were not accepted by Icann’s computerised system after early users discovered they could see each other’s files.

Remember, this is the company that is supposed to be in charge of stability and security of the domain name system.

But the truth is Icann doesn’t have to be good at its job. Before it existed, its role was played by one person, Jon Postel, who acted as final arbiter of domain names in his spare time.

Most of what it does could be automated. Almost all of that security is, in fact, decentralised to other institutions. All, except for the politics – the politics, for instance, of deciding who exactly should get the pile of money that exists, because no-one can work out how to allocate who gets what domain name if they were all free.

Or the politics of deciding what top level domains should exist, and what should not, when any limit on the number of top level domains is entirely arbitrary.

Icann will unveil its new CEO today, after the previous incumbent, Rod Beckstrom, announced his departure when his contract expires on July 1st.

Whoever takes over will have one of the world’s craziest jobs – a job with almost no accountability or responsibility, but which billions of dollars of an entirely constructed industry depend on.

It’s hard to know what he or she should do, but they will almost certainly be paid very well to do it.