Changing of the guard

I must say I know of no forum in which an individual citizen has the freedom to say what he likes and in any manner he wishes about another individual citizen with immunity from suits for all consequences. Judge Ross, in his summing up of the Alan Brown defamation case, 3 May 2000.’’

As the cosmic clock ticked over into the new millennium, debate about the struggling Domainz registry system, the ‘religious war’ over which model was best suited for the future and heated exchanges about the Alan Brown defamation case dominated the ISOCNZ mailing lists, adding to an air of conspiracy.

Jim Higgins, who remained chairman of Domainz, claimed certain individuals had begun to gather a ‘clique of geeks’ around them who didn’t like the way the ISOC and the registry company were being run. “Some of them were quite unpleasant people who tended to live in dark rooms, and were what I call email heroes - feisty on email but when you looked them in the eye, it all turned to custard.”

David Farrar, who had been involved at some level with ISOCNZ since its first year of operation, had been caught releasing confidential council material to anti-Domainz campaigner Peter Mott and others who were lobbying for a shared registry. He ‘fell on his sword’ and voluntarily resigned from the council, just ahead of the June 2000 AGM. Chairman Peter Dengate Thrush and executive director Sue Leader had become aware of a sudden ‘furious growth’ in membership applications. “They weren’t the run-of-the-mill membership applications; it was quite clear something was going to happen.”

At the ISOCNZ annual general meeting on 23 June 2000 everything that had been fermenting beneath the surface hit the fan. About 100 new members had passed on their proxy votes. David Farrar and council member Peter Mott between them held 75 percent of the proxy votes, other key movers for change were Roger de Salis, an ISOCNZ councillor and former director of Domainz, and ISP owner, Robert Gray. Their goal was to overturn the council and board and move things quickly to a fully shared registry system.

Half the council of 20 were due for re-election. The proxy votes overturned nine of them. Keith Davidson was the only one up for re-election to retain his seat, receiving 235 votes; the only time any standing member had received more than 200 votes for any position. The incoming council was Rick Shera, Andy Linton, Steven Judd, Robert Gray, David Zanetti, Steven Heath, Simon Blake, Arron Scott, and Jordan Carter. The new council and board voted to accept the SRS model and the recommendations of the ‘Review of Registry Structure of the .nz ccTLD,’ commonly known as the Hine Report.

In general business John Hine presented the Domainz Model Review Working Group report; a decision was made to remove the registry function from Domainz which would be maintained as a registrar. It had 12 months to accomplish this. It was also agreed to have an open working group consult with Domainz, ISPs, and registrars and develop a full proposal on a redesign of the DRS technology. ISCONZ would retain the management of and Domainz would become a wholesaler. There would be a major structural change.

Crisis of confidence

The AGM also directed the incoming council to commission an independent review of how Domainz had performed with regard to the design, construction, and implementation of the existing system, including risk management, user specifications, documentation, communication, and the technical issues.

An earlier meeting had passed a resolution supporting the court action against Alan Brown, but that was overturned with a fresh motion at the AGM ‘deploring the defamation action carried out by the CEO of Domainz against Alan Brown,’ with a number of abstentions. A further motion was carried that the AGM deplore the fact that Domainz was financially supporting the defamation action and directing the incoming council to request the Domainz Board withdraw its support.[1] The minutes of the meeting seem to ignore the fact that it was Domainz that had brought the action in the first place, believing it needed to take a stand to protect the credibility of itself and its chief executive.[2]

There was a vote of no confidence in the board of Domainz, which resulted in a long discussion about what that literally meant. Domainz chairman Jim Higgins and board members David Quigg and David Bain refused to bow out, questioning whether the proxy vote was legitimate. The council took legal advice. In the meantime Domainz board members James Scott and Peter Dengate Thrush resigned, believing it was untenable for them to continue without full support.

The AGM directed the incoming council that ‘rules of cabinet secrecy were inappropriate to an incorporated society and ‘the practice of collective responsibility be terminated forthwith.’ Councillors would be able to continue to speak in public against any decision they disagreed with.[3]

Dengate Thrush explained there had remained an element of tension between the policy of previous chairman, Jim Higgins, who had wanted to keep ISOCNZ business confidential, including the management of the domain name, while members of the Internet community felt this information should be publicly available. He had attempted to change the culture of meetings to become more free and open, including making MP3 files and copies of the minutes available on the Web.

At the next ISOCNZ council meeting on 7 July 2000 at the Museum Hotel De Wheels in Cable Street, Wellington, James Scott was reappointed to the Domainz board and although nominated, Dengate Thrush stood down in preference to a nominee who he knew would make the right changes at Domainz. Having sat for a year as ISOCNZ chairman, with one year to go on council, Dengate Thrush did not believe he would, expecting that role to go to Roger de Salis, who represented a new group within council that wanted him to stand. However de Salis declined the role, preferring to focus on his work within Domainz and Dengate Thrush was re-elected as chairman for a second term.[4] One of his first tasks, based on legal advice, was to serve notice on remaining board members, Quigg, Bain, and Higgins. An interim board was appointed.

“Jim did excellent work in the founding days of both ISOCNZ and Domainz, and it was advantageous to have him in both places at once, but as the organisation matured and there was increasing community displeasure with Domainz’s performance, that position became untenable,” said Dengate Thrush. Back in the chair, he was now better able to support the new shared registry approach recommended by John Hine and his working group. The council requested the new board commission a third-party report on the DRS implementation in its entirety.[5]

David Farrar said the subsequent report was ‘a damning indictment.’ It had listed all the security vulnerabilities and management issues and ‘would not have gone down well with the public.’ As Domainz was becoming a competitive company it wouldn’t have been right to reveal its weaknesses. The report was considered, adopted, and destroyed because of its ‘highly sensitive’ nature.

The June 2000 AGM had been the flashpoint for change, shifting the direction of both organisations, responsible for the stability and welfare of the Internet in New Zealand. Throw in a clash of cultures, a defamation suit, a new IT system that didn’t live up to promises, and vested interests, and you have a recipe for revolution. “There was no one factor,” recalled Farrar. “When you need to effect change you can’t use a scalpel, you use a very blunt instrument. I helped roll some people off council who I considered to be quite good friends, whom I had incredible professional respect for. It was actually a quite painful experience for everyone concerned. The only way was to say, ‘Everyone on council has to go.’ Most of those people who were knocked off, to their great credit, stayed involved and are now still making some very good contributions.”

Most of those who gave their proxy votes to enable the AGM overthrow failed to renew their memberships the following year. It was agreed this could never occur again. Ultimately a new ruling was passed that you had to be a member for three weeks before voting.

Chairman Dengate Thrush was eager, after two ‘tempestuous years,’ to see a shift in emphasis away from the registry. He continued chairing the International Affairs Committee, strengthening the role and rights of country code managers and ccTLDs within ICANN. He set up ISOCNZ’s Social Impact Committee, which was monitoring and commenting on the effect the Internet was having on the community. It got behind the fledgling Internet Safety Group, which was concerned about protecting children on-line and was involved in discussions around the use of the Internet to breach a court order, suppressing the name of a wealthy US businessman accused of importing cannabis at the time of the America’s Cup in 2000. The NZ Herald reported:

[missing text] [6]

Dengate Thrush said the case was an early example of the Internet making something which had worked reasonably well for a century, redundant and unworkable. “By placing information on a web site outside the country, it was completely outside the jurisdiction of the New Zealand courts. While this had been true previously with international radio, TV and the press, the whole concept of suppression was rendered moot by the Internet.” Regardless of the merits of the cannabis case, he said suppression was in fact a useful tool. “Our concern was for cases which would surely come; for example the naming of children in sex cases, where the protection of their identity was no longer possible. We called for a study, and for careful thought to be given to establishing the balance of restricting information with the administration of justice, including never naming parties in court or any court documents ab initio[7] if it relied on basic and established laws, in recognition that the Internet allowed millions of people to be instant global publishers simply by possessing a desktop computer and an Internet connection. We said that the distinctions possible between informing people of the web site, which possibly breached the order when done from inside New Zealand, and visiting the site and reading the information which probably wasn’t, were all rather irrelevant. A new paradigm was required.”

The situation hadn’t improved by 2007, with witnesses naming the defendants in police sex trials in breach of long-established rules about informing jurors of a defendant’s previous convictions prior to judgment and the naming of an alleged murderer on-line before he had even come to court. InternetNZ continued to be concerned and planned a seminar and ongoing discussion on how to approach the subject.

“It was a relief to be able to concentrate on the kinds of real issues that had attracted most members to the Internet Society, rather than arguing about the best type of registry. We soon began to make a useful contribution to the national policy debate. For me it was a lesson in the power of participatory democracy, and the ability of the technology community to raise issues and to provide a forum for resolution. In the end, we maintained our corporate ideals, and proved the strength and effectiveness of industry-led, self regulation. In many ways, we demonstrated the viability of continued private sector leadership of the governance of the Internet,” said Dengate Thrush.

End of an era

The Patrick O’Brien defamation case against Alan Brown continued to bubble under the surface but even that couldn’t keep the irrepressible Brown’s tirades in on-line forums. He was suspended from using the ISOCNZ members’ mailing list in April 2000. Dengate Thrush was one of a number of people concerned about the quality of debate on the ISOCNZ members’ mailing list. “In my experience as a professional it was a great deterrent to being a member of ISOCNZ. The volume and quality of what was being posted in the end prohibited useful debate. It was dominated by people who obviously spent all day in front of their screens, and we were grappling with what were effectively bullying, flooding and flaming on the list. Sue Leader had written acceptable use policies for the list but they weren’t being observed so I decided we should have a moderator or sheriff. I think the first person I appointed was David Zanetti; as a result the volume of traffic on the list went down and the quality of debate went up.”

Warnings about content didn’t deter Brown. He was suspended from the ISOCNZ members’ mailing list for two weeks when executive director Sue Leader found comments he had made about Domainz’s PR company breached the acceptable use policy. He then gained access to the list using Leader’s email address to post insults about her. The ISOCNZ council, in a bid “to raise standards for communication on the Internet”[8] extended Brown’s ban to the members’ list and the public ISOCNZ-1 list to four weeks. A decision to remove the gateway between the list and the newsgroup to prevent him posting again infuriated many in the Internet community.[9]

In August 2000 Peter Mott was again on the attack. He threatened High Court action against ISOCNZ, alleging it had a deliberate policy of urging his customers to change to other providers. He claimed to have written evidence from a Domainz employee that his company ‘2Day had specifically requested not to be considered as a name service provider.’ Mott denied this. “We asked not to be referred to as a registrar on the Domainz web site, because we are an ICANN registrar and the Domainz use of the word is completely different to the ICANN meaning.” The term ‘registrar’ had since been replaced with ‘domain name service provider,’ which Mott said adequately described his service. He was frustrated that his ISP was still not listed in the drop-down box on Domainz’s web site ‘despite trying to resolve the issue for ages.’ Some ISOCNZ councillors were angered at evidence of such claims. There had been an attempt to have chief executive Patrick O’Brien remedy the matter.[10]

Patrick O’Brien certainly left a legacy, but in many people’s minds it was mired by the public face he presented when playing hardball and sorting out business and legal issues that stood in the way of Domainz and its goals. “Someone once said that as CEO of Domainz, there was no need to wear a suit. All you had to do was open up the email, and a ‘suit’ would be waiting pretty much every day. I guess that might have been a fair take on the changing legal and commercial environment then but life wasn’t just about defamation,” said O’Brien.

There were the stoushes with the Commerce Commission, the Privacy Commissioner, the Office of Fair Trading, trademark and copyright issues, court cases of domain name hijacking and domain name ownership, international governance issues, and of course the creation of a highly successful and profitable business, which was to leave ISOCNZ cash rich and able to become far more involved as an Internet activist. O’Brien left Domainz at the end of September 2000. The time was right to move on as ‘commercialisation of the registry has certainly been successfully achieved and the company is now entering a new era with a new focus.’

In a Computerworld article ‘Domainz CEO walks,’ Russell Brown said O’Brien had been increasingly embattled, especially since his friend and supporter Jim Higgins stepped down as ISOCNZ Council chairman. Domainz’ relations with other industry players had been strained, especially over the new $700,000 registry system introduced in 2000 and the Domainz ‘accredited registrar’ contracts, which many ISPs had refused to sign. managing director Peter Mott, who had frequently been at odds with O’Brien, was quick to applaud his departure. “As a monopoly supplier to a young and innovative industry, Domainz has regretfully brought complexity, confusion, and frustration to a market that has been screaming for simplicity,” said Mott. The CEO’s future appears to have been discussed at consecutive meetings of both the Domainz board and the ISOCNZ council on 24 August, after Mott made his complaint about his listing being ignored. Mott said O’Brien’s departure should not delay progress to a competitive domain name registration mode. Acting Domainz board chairman Robert Gray said the company was ‘ready to move to its next phase of development’ on the basis of the Hine report.[11]

Preparing for a makeover

The final version of the Hine Report was presented to the ISOCNZ Council on 20 October 2000 and became a template for revising how domain names were handled in New Zealand. It said a lightweight registry was needed that involved registrars who were roughly congruent with ISPs, registering names, largely mechanically, without involvement from the registry and paying relatively low fees, said former Victoria University domain name manager Don Stokes. The SRS would help distance Domainz from ISOCNZ, reposition it as a wholesaler of domain name services, put an end to claims of a perceived conflict of interest, and gear the operation for the sale of Domainz as a registrar.

There was a strong feeling amongst ISOCNZ members and the .nz community in general that the new registry should have a slim-line operational model for the ongoing management of the SRS and DNS, including a simple billing arrangement with registrars. This was often described as the ‘two geeks and a pager’ model and, although not adopted as a formal requirement, was an unstated goal that loosely defined the parameters of the technical solution.[12]

The month the report was published, Domainz was supporting about 74,500 registered domain names, and while it had been encouraging other businesses to register domains it remained the registry’s fifth largest customer. The Hine Report suggested Domainz should present the same registry interface to all registrars including itself and said its present role as registry and registrar was perceived to be creating a conflict of interest with other registrars. Customers were often confused by the billing cycle and unsolicited messages from Domainz. While Domainz provided an excellent service to registrants, its customer focus was ‘wholly inappropriate’ and inhibited the development of alternative services some registrars would like to offer. It also confused registrants about who was responsible for resolving particular problems.

Following ‘broad-based comment and complaint’ about Domainz’s lack of consultation, particularly on technical interfaces, the report noted that Domainz was not perceived as operating according to ISOCNZ’s values, which required the registry to operate ‘in a co-operative fashion to facilitate the operation and development of the Internet in New Zealand, and should not abuse its monopoly status.’

It recommended the market for services relating to domain names be made open and competitive with no significant barriers to the entry of new services. Policy should be altered to remove the registration function from the registry, so it could focus on registrars as its customers. This would create more of a level playing field, foster competition in the registrar market, and lead to a greater range of services and options for registrars. All of this would simplify the role of ISOCNZ, allowing it to focus more clearly on its wider objectives.[13]

Further urgency was given to getting a new system up and running when it became clear that the existing Domainz registry system remained unstable, nearly six months after retiring CEO Patrick O’Brien declared it to be ‘working well.’ Interim CEO Donna Hiser emailed service providers at the end of November 2000, saying a large part of each day was still spent helping customers who were experiencing bugs in the system. “The highest priority for us is to clear those bugs so that your businesses can run smoothly and our attention can focus on longer term improvements.’ Advantage Group, the original developer, was committed to achieving this, and she noted her ‘considerable frustration with the design of the Domainz Web interface,’ promising quick remedies. The published cost of the system to date was $750,000.[14] Hiser was replaced by Derek Locke as Domainz CEO on conclusion of her six-month contract.

Robert Hunt, director of Plain Communications in Christchurch, said there were daily frustrations. “ISPs were trying to set up domains for users and do the real business after they made a sale. The one thing we had to have in the middle was registration of the domain, so the root name servers knew about it. If it didn’t work, or there were delays in moving from one company to another, you would have email going astray. That mess went on for years and the amount of business time it wasted is just unthinkable.”

The ongoing involvement in managing the space through its solely owned subsidiary Domainz continued to take up most of ISOCNZ’s time. Despite several reductions in fees for domain names, Domainz had still managed to net its parent company a surplus of half a million dollars in 2000.

The sharing machine

The first steps in preparing the business case for the SRS were completed in October 2000. Then five months later an Implementation Oversight Committee (IOC) was established under Bob Gray, an ISOCNZ councilor and chairman of the Domainz board, as a steering group for the project. External consultant and implementation manager Rose Percival began discussions with the industry, and turning the recommendations of the Hine Report into workable business processes.

External consultant Doug Mercer was appointed to manage the technical implementation. A request for information was put to the market on 29 October for a partner to develop a prototype and prove the ‘suitability, integrity, performance, and reliability of the proposed architecture,’ then develop the application. In all 51 companies responded, 17 made formal responses, and this was narrowed down to a shortlist of four. Catalyst IT,[15] Optimation, Sytec, and Zivo were invited to make proposals on 23 November. Sytec, withdrew and the contract went to Catalyst IT. The technical work on the SRS began on 3 September 2001, and the budget for it was approved by the ISOCNZ council in December.

In May 2001 the ISOCNZ rebranded itself as InternetNZ, partly to give it a fresh face following the recent high-profile legal and internal issues, and partly to eliminate any thought that it was a local chapter of the international ISOC. There had often been confusion when local representatives, who were contributing to important decisions about the future of the Internet, went to international meetings. Being mistaken as an affiliate of ISOC was becoming embarrassing. Pressure from Sue Leader and Peter Dengate Thrush to change the name had been coming for a couple of years, but it had never made it to the agenda before.

Meanwhile the number of registered domains stretched out to 100,000 as Kapiti Signs owner Lance Patching registered the name, winning a mystery weekend holiday for two for his timely effort. New Domainz CEO Derek Locke said New Zealand now had the fifth highest number of registered domains per million of population in the world, with registrations growing at about 4000 a month. The non-profit organisation was run by 20 elected councillors voted on by its membership, which was open to anyone who could pay the $50 annual fee. In July 2001 the society consisted of only 400 members, a tiny portion of the million or so New Zealanders who now used the Internet.

While the main media focus seemed to be on ISOCNZ’s internal troubles, a perception easily deduced by the invective charged debates, on the various Internet community newsgroups, members of the committee continued to put endless hours into more constructive pursuits. Every issue that had some long-term impact on the future of a ‘free and uncapturable’ Internet in New Zealand required careful consideration, and after a fully democratic process of open discussion, submissions representing the Internet community were made to inform decision-making groups.

With a number of laws and telecommunications issues which were of immense importance to the future health of the Internet community being revised, ISOCNZ had its work cut out for it. It couldn’t claim to represent the industry without full consultation and research that would enable its submissions to be considered expert. The group was clearly beginning to have some clout as many of its position statements began to form the basis of changes in our laws and how the telecommunications environment should evolve.

In February 2001 Ewan McNeil, Rick Shera, and Sue Leader made a submission on the Crimes Amendment Bill.[16] In September Keith Davidson submitted a position paper on the Telecommunications Bill.[17] In January 2002 a submission by Rick Shera and Sue Leader on the Consumer Protection Bill[18] and in October Shera, Stephen Bell, and Leader made the ISOCNZ’s position known on the Inquiry into the Operation of Films Act.[19] InternetNZ was increasingly perceived as having a powerful voice as a lobby group, influencing public opinion and government policy. It was involved in education of users on issues such as safety and security, and fair play between ISPs.

Newly elected chairman Keith Davidson, at the time general manager of Wairarapa Internet access provider and the Wairarapa Times Age newspaper, hoped proposed changes to the way the Domainz registry was run would open up a new chapter in the workings of the society. Under the proposed changes the .nzRegistry would be operated by an InternetNZ-owned body known as the New Zealand Domain Registry, and Domainz would be spun off and prepared for sale.[20] The InternetNZ council had agreed at its December 2001 meeting that Domainz would act as a ‘stabilising registrar’ in the interim.

In February 2002 InternetNZ began advertising for its first domain name commissioner, to oversee the operation of the namespace, during and after the transition to the new system. This person would be the only privately appointed regulator in the world, responsible for managing the contractual relationship between the domain name registrar, the registrant, and the registry. Other countries were still grappling with this role, many relegating it to governments, but the New Zealand’s model was soon attracting considerable attention.

Work on the new million-dollar-plus software package was underway and tenders were out for a new accounting and billing system as part of the registry system replacement. The development would be done in small, manageable increments to avoid the embarrassing problems that had bogged down the previous system.[21] The first stages of the SRS were implemented on 14 October 2002, with Domainz as the sole registrar. The project budget was $1.095 million; it was completed on time and $171,012 under budget. In the days following implementation, a number of migration issues were uncovered but this was considered small in proportion to the number of domain names involved, which was approaching 120,000.

Technical manager, Doug Mercer, said the process of implementing the SRS had been complicated through the legacy of tension that had developed in the InternetNZ community, largely relating to the earlier implementation of the DRS by Domainz:

The SRS was now open to competing registrars and according to newly appointed domain name commissioner, Debbie Monahan, the launch went with barely a hiccup. The SRS would form the core of a new regime for domain name registrations, allowing all registrars to add and change names directly in the register itself rather than through Domainz. The DRS would continue to run in parallel as a back-up in case anything went wrong. The new system would be rolled out in stages, finally taking over fully on 7 December 2002.

Domainz on the block

On 6 June 2003, as the dust was settling, hopes were high that the Domainz registrar business would soon be sold off. Ironically Monahan was then forced to suspend Domainz from trading for 48 hours. The sanction she said was not as punitive as it might have been, because of ‘mitigating circumstances.’

Monahan had been in the job just over a year, and until the SRS and its policies and procedures kicked in, she literally had no authority. After the first stage of the SRS went live on 14 October 2002 an agreement was put in place between Domainz, InternetNZ, and the new registry company, that Domainz would now begin its year-long role as a stabilising registrar. Domainz, still registrar for all the domain names, was to transfer these according to set policies and procedures, as new registrars were authorised.

Domainz had, however, got into the habit of taking payment for names but only validating them for a month until the cheque, credit card, or invoice had cleared, regardless of whether registration was for one month or 120 months. Once the funds came through it would update the .nzRegistry for the appropriate period. That adjustment wasn’t being made fast enough and resulted in great confusion. “As people transferred away to different registrars some customers were being told they needed to renew their domain name registration as it was only for one month. To the customers it looked like the new registrars were wrong but it was Domainz,” said Monaghan.

A significant number of registrars faced problems, so Domainz had to go back through its systems, put things right, and compensate registrars who had paid again, to ensure the domain names remained active. “We let Domainz stay on the system to maintain their existing names but they couldn’t do anything that involved generating new revenue for 48 hours during a normal working week. They also had to display a notice on their web site that they had been sanctioned,” she said.

“We acknowledged they had done some good work but they did affect a number of people and consequently had to amend their processes. It also showed the market that the new rules were going to be enforced and that people needed to be compliant. We said we would operate fairly and independently of InternetNZ, even though we were one of their operating companies.” The news of the sanction came on the same day that it was announced Domainz was for sale.

For executive director, Sue Leader, InternetNZ had worked through the major developmental issues and was now well positioned to move into a consolidation phase. It was time to move on. She worked a three-month extension to her final contract while a new executive director was sought.

As head of the ITANZ, Peter Macaulay was aware of the difficulties and dramas surrounding domain management and had turned down an offer to mediate. “I looked at the people involved and thought, ‘Trying to fix this would be like trying to separate two fighting Irishmen; they will stop fighting long enough to beat you to a pulp and then go back to their own fight.’” Besides, he knew most of the people involved and there was good and bad on both sides in his view. “Altruism was being mistaken for failure to plan and failure to plan was being mistaken as altruism.”

Macaulay had been working in England during the big dust-up when former committee members at the ISOC were ousted. On his return in 2002 he became its new chief executive. The first task in his 18-month contract was to sell Domainz. Fortunately he had a supportive team with David Farrar, Chris Streatfield, and Keith Davidson, who all had commercial nous and knew how to get things done. He brought in Tim Russell from Deloittes to manage the process. “The main challenge was, how do you take a company which has to shrink in size, drop the amount of business it’s got by nearly 30 percent, then sell it for a lot more money?”

The prime consideration, he said was to focus on growing the entire market. “We were not going to give away the whole pie, only a slice of it. But if we made the pie bigger there would be a lot more for everyone else. The key was developing the business so that our slice was big enough to get some real money, and those left would still be excited to come on board.” On 21 August 2003 the final act in the transition to open competition of the domain name space was announced. Domainz CEO Derek Locke and his management team had put in their own bid for Domainz, but conceded the company went to Australia registrar Melbourne IT for $1.5 million, more than double the market value.

Melbourne IT was one of the larger registrars in the world, although it was in a similar position to Domainz – a former monopoly registrar moving into a competitive world.[22] Under the new SRS model InternetNZ would no longer own a competing registrar. As of 31 August 2003 30 organisations were authorised as registrars and connected to the SRS providing direct domain name registration services. A further ten organisations were authorised as registrars, and preparing to connect to the production environment. The sale of Domainz, finalised on Friday 5 September 2003, and the agreement from the Registry to release the SRS source code, marked the end of a long and difficult path to a truly competitive and pro-registrant shared registry service for the namespace.

The successor to Dengate Thrush, as president of the society and chairman of the ISOCNZ Council, was Keith Davidson. He wouldn’t be drawn on where the money from the sale of Domainz would go but claimed it could be spent several times over on office expenses and running the organisation; besides the SRS had cost the organisation a packet. It was the beginning of a new era and time for InternetNZ to start focusing on the backlog of Internet governance issues that had built up. “Those early council meetings were about 90 percent on and 10 percent on everything else; certainly while we were getting the SRS model right, and the right people and level of reporting in place. It wasn’t until about 2004-2005 that it swung the other way where we could spend only 10 percent of our time on matters, and the balance on the broader objectives of the society.”

InternetNZ AS Guardian

InternetNZ began to review its own goals and strategies. As the Internet continued to grow exponentially there were no shortage of opportunities to make good on its self-appointed role as guardian of the Internet in New Zealand.

Apart from continuing to represent the New Zealand on global Internet organisations as the delegation for the top level domain ccTLD, it was there to foster ‘co-ordinated and co-operative development,’ to ‘promote and protect’ and ensure the Internet in New Zealand operated in an open and uncapturable environment. Its membership now embraced ISPs, Web designers, academics, public information groups, and Internet users. It could increasingly operate as a body that educated and provided commentary and research to politicians, industry influencers, and the media.

From 2003 it became far more active as a lobby group attempting to gain industry consensus and removing any obstacles to the growth and wider use of the Internet, including ongoing work on a wide-ranging code of practice for ISPs. Issues such as improving the security of the domain system, preparing the country for the transition from IPv4 to IPv6, establishing a Research Fellowship for Cyberlaw with Victoria University, and making submissions on the government’s Digital Strategy were now front of mind.

Macaulay brought a more output-focused business approach. He saw the society’s role as facilitator, providing the tools and administration base for groups such as Next Generation Internet (NGI-NZ), the Internet Advisory Group and working towards closer relationships with the Network Operators Group (NZNOG), the Computer Society, and others. InternetNZ moved into larger premises, with all three of its units now at the same address.

In his 2004 executive director’s report Macaulay quipped that one day there would be as much need for an Internet Society as there is for a Telephone Society. “But don’t expect it soon, especially in New Zealand which is plodding towards true ubiquity, steadily but slower than most similarly placed countries … We have our headlights on full beam and a good piece of the road ahead is visible, although we are not free of bumps … It is our time to become more assertive in demanding that our industry and our government lift their game, and deliver fibre and affordable connections to every home.”[23]

He began scanning the world for next generation filtering technology to reduce spam and porn and monitor rogue ISPs. He was looking into ways to improve on the 1999 ISP Draft Code of Practice, being worked out in conjunction with ISPs and other stakeholders, including the Consumer’s Institute, the Direct Marketing Association and Advertising Standards Authority and administered by the 12-member advisory group. “We want something easy to understand, not like the Australian Internet code of practice, which is 30 pages long and reads more like an Act of Parliament. ISPs will find it increasingly hard to get customers if they are not a signatory and the advisory group will have the ability to revoke their registration if there are breaches of conduct,” said Macaulay in Telecommunications Review.

In his final year as chief executive Macaulay talked of the importance of maintaining strong relationships with government, the various communities of interest, and the ICT industry. “The key thing was to eliminate the perception that the society was a bunch of amateurs dashing around beating their heads against things.” By the end of 2005 InternetNZ was deeply engaged in consulting with the Commerce Commission on unbundling the local loop and a review of the Telecommunications Act as part of the government’s telecommunications stock take, with a professional team fronted by lawyer Michael Wigley. The society gained further credibility through its support for the Internet Safety Group.

“Along with good management of the domain name, and a track record of having representatives including Peter Dengate Thrush on ICANN, people began to see the Internet in New Zealand was in safe hands.”

It was never expected that the role of steering the New Zealand Internet into the future would involve such a painful cultural, technical, and administrative transition. Stepping back with a healthy budget, a lightened workload, and fresh faces on board the way was clear for some new thinking. InternetNZ was now well on track to becoming the kind of organisation it had wanted to be all along.

Defending the code

In the middle of 1997, the US Government began seeking input into the management of the domain name space amidst concerns from trading partners that the Internet was too US-centric. After all the Internet was now a global phenomenon and many nations were increasingly dependent on it for their economic well-being.

Back in 1992 NSI had made a smart move when it won the contract with the NSF to develop the domain name registration service. The next year it was granted an exclusive contract to be the sole domain name registrar for,, and TLD names. No one at the time had any inkling, that with the arrival of the Mosaic browser and the phenomenal growth of the World Wide Web, would become the preferred domain for commercial business. In 1995 when NSF granted it authority to begin charging US$100 for two years’ registration.NSI began turning over millions of dollars, which many believed was excessive, particularly as it had a monopoly position in the market.

The lucrative contract for the commercial domain, which was increasingly used by New Zealand companies, was about to expire. On the table was a new system and the transition to a more competitive shared (SRS) marketplace with rules and policies of governance. The role of NSI, which had revenues of US$45 million in 1997 through regulating the addresses, was about to change. With the obvious growth curve in Internet uptake it was also clear that IANA, a US Government contract run by Dr Jon Postel, would also need to be reviewed. The first attempt at a replacement body occurred in 1994 when Postel attempted to place IANA under the ISOC.

ISOC and its industry allies tried again to take control of the high-level domain name processes and Internet governance through the International Ad Hoc Committee (IAHC). It proposed through the Generic Top level Domains – Memorandum of Understanding (gTLD-MOU) to create 50 new registries, hosting three new TLDs each, and appoint additional registrars managing the resulting 150 new names. This process would have involved some control shifting to the International Telecommunications Union (ITU) in Geneva.

Roger Hicks, who had been the ISOCNZ inaugural chairman, alerted the Council of the issues brewing at international level which could have a serious impact on the running of the New Zealand country code. He raised concerns about the work being done by the IAHC on generic domains and challenged its right to represent the Internet community. While the system of delegation put in place by Jon Postel and IANA wasn’t likely to change, the central role of IANA, and the ISOC in Internet governance was being examined. Both the ITU and the WIPO were taking a strong interest, particularly in the DNS, believing there should be a strong tie between domain names and trademarks.

Hicks was particularly concerned at the lack of representation for New Zealand on decision-making committees and the fact domain names were being so closely associated with trademarks. There was no international trademark law, so trademarks needed to be registered separately for every applicable jurisdiction. That in itself presented a huge problem for most country code managers, like New Zealand. An international agreement could easily be overridden by local law, leading to conflicts with country registries. There was also a possibility of a split in the DNS, with some new domains not being recognised in some jurisdictions. And there were suggestions that disputes over trademarks be handled by the WIPO, which further set off alarm bells for New Zealand.

These issues were up for discussion at the NSI meeting in April 1998 where the contract for administration of the existing TLDs was to be renegotiated. ISOCNZ began looking at ways to put its case and ensure its voice was heard in these important discussions on the future of the Internet. Roger Hicks was a member of the APIA, representing a group of heavyweight commercial concerns in the region. It had gained NGO status on the ITU and was concerned that under the WIPO it could take 30–60 days to register a domain name, in order to allow objections to be raised over potential trademark conflicts. It was opposed to the move so Hicks offered to act as a liaison between APIA and ISOCNZ and report on progress.

Fighting for the future

It was clear that if e-commerce, for example, were to flourish, a stable, predicable Internet environment with a clear distinction between trademarks and domain names was needed. There were concerns at the lack of consultation in the way the IAHC had been set up, the large cost involved in establishing a registry, and the overall issue of accountability for running the Internet, including quality of service issues. In all of this the small country code managers seemed to be railroaded, almost as if their views didn’t count.

Domainz chief executive Patrick O’Brien saw common issues plaguing other national registries and believed it would be useful to have a regional contact group. If such a commercial arrangement could be put in place Domainz might be able to support Pacific Island and other regional domains. ISOCNZ councillor Andy Linton was particularly interested in the issue as he was the technical contact for six Pacific Islands registries as well as Nepal.[24]

The IAHC had its ambitions curbed when a US Government greenpaper issued in January 1998 sought wider discussion on core Internet governance issues. In the follow-up whitepaper in April, US policy was set out regarding privatisation of, among other things, the domain name system, suggesting ‘a global industry-led, government-free, self-regulating not-for profit’ entity be established to manage and co-ordinate policy for allocating blocks of IP addresses to regional registries. It would also oversee the Internet Root Server system, policies for creating new domains, and co-ordinate Internet technical parameters.

Debate continued over the possible outcomes once US Government funding for IANA ceased, the overarching possibility being that if the various meetings couldn’t agree, the US Commerce Department might follow through with its threats to create the necessary infrastructure itself. The whitepaper was discussed in meetings around the world in the International Forum on the Whitepaper (IFWP), which brought all the country code managers, address registry managers, governments, and civil society together for the first time to grapple with the issue of a global governance structure for the Internet. A series of five meetings were held. WIPO was concurrently conducting its global circuit of discussions seeking support for its recommendations on trademark and domain name dispute resolutions.

New Zealand made submissions at the Sydney meeting, defending its position that domain names should not be related to trademarks in any way, and that dispute resolution should be up to each country to sort out themselves.

Patrick O’Brien and ISOCNZ chairman Jim Higgins attended both the Geneva[25] and Singapore meetings where the devolution of IANA was being discussed. They put forward the New Zealand experience and the actual working model devised by ISOCNZ as a possible solution. The submission was well received, giving New Zealand a relatively high profile at the meetings and within the wider Internet community. The Asia-Pacific Regional ccTLD was established with Korea in the chair. However the World Wide Alliance of Top Level Domains (wwTLD) group was also formed, and despite opposition, including from New Zealand, decided to exclude NSI. The issue then became who the stakeholders were, how voting would work and how the new stakeholders in Internet governance would be represented. The next meeting in Boston would be the clincher.[26]

Country code challenge

Towards the end of 1998, after the round of meetings had concluded, Jon Postel and several others submitted a draft constitution and bylaws for the private sector entity called for in the whitepaper.

Peter Dengate Thrush and Patrick O’Brien, on behalf of ISOCNZ and Domainz, had made submissions to the US Government as part of the Boston Working Group (BWG) in late 1998. They wanted to ensure the protection of New Zealand’s authority for the country code, clarify the distinction between trademarks and domains, and gain a greater role in decision making for country code managers. While the various bodies involved in governance were looking to build an industry-level government free organisation, NSI’s monopoly continued to be a major point of contention. Getting everyone to agree on how a new non-profit organisation would take over proved a headache.

“People were trying to grapple with the various issues, and the debate often became very heated. Dozens of people thought they were going to become registrars and each different group was insistent on raising the issues relating to their own particular problems. The country code managers wanted confirmation and security about their roles, address registries were concerned about their allocation of IP addresses and, governments were wondering what their proper role was going to be in this new global structure,” said Dengate Thrush.

The debate eventually resulted in the formation of the ICANN, which had the job of placing Internet governance at arm’s length from the US and any other government. The NTIA, the advisory agency on IT&C to the US Department of Commerce, ultimately contracted ICANN to administer the DNS and deliver partial competition. Many of the core members of the first two attempts at achieving a governance group were heavily involved in ICANN, including the ISOC, the IAB, the Policy Oversight Committee (POC), WIPO, and the ITU; in the view of some, this determined group had in fact succeeded in ‘capturing’ the roles it initially sought.

The new body, operating from Marina del Ray in California as a non-profit corporation under Californian law, made its first priority to break the monopoly. It was eventually successful in transferring the US Government contract with NSI to itself. ICANN installed an SRS and introduced competitive registrars. Under the new arrangement NSI retained its monopoly on,, and but had to recognise a separation of registry and registrar, where accredited registrars would all have access to the data in the registry, in itself a fundamental shift. From the previous position of a single registrar doing everything, there were now multiple registrars. ICANN also adopted the WIPO recommendations on trademark and domain name clashes into the Uniform Dispute Resolution Process (UDRM), a compulsory arbitration process.

Jumping the gun

There was widespread alarm when it became clear that this newly formed body was already making important policy decisions even before its own structures were fully in place. It seemed to some within the Internet community that the future of the Internet was being determined by a small group of interim appointees, not by the wider membership structure as had been originally mandated.

ICANN’s collaboration with the WIPO to ratify rules and regulations for country domain names, dispute resolution and copyright and trademark protection remained a source of global concern. No one really knew what might happen. The New Zealand contingency was strongly opposed to having legal and intellectual property disputes settled according to US law. It was also astounded that fees were being proposed along with an assurance of liquid assets of $200,000 before any organisation would be allowed to register gTLDs names.

ICANN was seeking formal agreements with the 13 ‘root server’ operators, the regional Internet registries, including the groups that handled the regional IP numbering scheme such as APNIC; the operators of gTLD such as,, and (later and and the 240 or so ccTLD, including

However in its attempt to establish contracts with the country code managers ICANN had made a major mistake. It assumed all country code registries were for profit and modelled on NSI and tried to roll out the same kind of contract. “We had to fight long and hard, and engaged in a lot of educating along the way, to establish that we were responsible to our local Internet community, our national government and local laws. We were not going to be governed from the US,” said Dengate Thrush.

All this rush of activity that seemed to be assuming the support of the wider community was getting up the nose of many country code managers, resulting in a growing support for regional representation. The Australian Government was outspoken in its bid to have a say on all future developments. The Europeans formed an alliance to ensure they were fully represented as did some Asia-Pacific nations, including New Zealand. Then as the fall-out from the ‘virgin birth’ of ICANN escalated, it became clear that the representation needed to be from the actual manager. In order to ensure there was a mandate from all stakeholders, ISOCNZ chief executive Sue Leader organised the New Zealand Internet Summit in Auckland at the end of April 1999 to consult on the matter and subsequently wrote a position paper.

As ISOCNZ still had little income to cover its involvement, attendance numbers were kept low and prioritised around meetings that directly involved country code issues. In May 1999 ISOCNZ, with backing of the Ministry of Commerce and the mandate from the industry summit, urged ICANN at the Berlin meeting to ‘take its hands off’ the New Zealand domain name. It claimed the proposed changes would ‘affect national sovereignty and impose significant regulatory and financial pressure on the industry here.’ Labour’s communications spokesperson Marion Hobbs, speaking at the ISOCNZ summit, was concerned the changes might limit New Zealand’s ability to compete internationally and raise costs for businesses and private citizens to participate in the Internet.[27]

Then there was the risk that the space might be wrested from ISOCNZ control and possibly even pass to the government. ISOCNZ and Domainz chairman Jim Higgins continued to push the New Zealand model as preferable for future management of the Internet. “No one wants to be disenfranchised. The risk is that solutions may be applied across the world and may not be legally or culturally acceptable to some countries.” He urged the New Zealand Government to maintain its ‘hands-off stance’ even if it were offered the rights.

ISOCNZ on right foot

Technology Minister Maurice Williamson wasn’t aware of any significant complaints about how ISOCNZ ran the domain. He said the Internet had developed as fast in New Zealand as anywhere in the world without any great government intervention. However the Ministry of Commerce would continue to monitor development and use of the Internet and report back on issues such as pornography, digital signatures, encryption, trademarks, and intellectual property protection.

The Kiwi contingent, Peter Dengate Thrush, Jim Higgins, and Patrick O’Brien, attended ICANN meetings, representing the country code, starting in Singapore in February 1999 and thereafter in Berlin, Santiago, and Los Angeles. Unlike the Domainz representatives, ISOCNZ executive director Sue Leader found herself travelling economy class for the regular 12-hour flights until her airpoints entitled her to the occasional upgrade to business class to attend meetings.

The US whitepaper hardly referred to country code managers and was very US-centric. Those who drafted it later acknowledged they had been largely unaware that many country code managers were private entities, and had been treating them as if they were under the control of national governments, said Dengate Thrush. “They didn’t really grasp what was going on until Sue Leader and I participated in all the meetings from Berlin onwards and helped set up the ccTLD managers group within ICANN, where the New Zealand model was held in high regard.”

The vocal protests of New Zealand and other nations over the most controversial proposals, including adding new generic domains, and the roles of national governments, were eventually overturned. It would take a long time for things to settle. Meanwhile Patrick O’Brien, who had also lobbied hard for autonomous country code management, had made himself so familiar with the processes and presented such an endearing picture of the efficiencies and processes back in New Zealand, that he was about to get himself elected to the board of ICANN.

Just as that process was concluding, murmurings back home arose about his role as a paid representative of Domainz not being compatible with such a public policy role. There was also a strong anti-O’Brien faction due to the changes he’d made in running Domainz, including charging for domain names, new business-focused procedures, and a contentious new system to handle domain name registration. Sensing he wasn’t going to win whichever way he pushed things, O’Brien backed down from the powerful international role.

However he had warmed to the SRS approach now being operated by NSI, participated in the debate about what to do with the domain and became convinced that this was the road Domainz needed to travel. His model, however, still kept Domainz as a primary gatekeeper, not only running the registry but also operating in a quasi-registrar capacity, which allowed other people to act as registrars on contract to Domainz.

ISOCNZ remained active and visible in the regional associations including the APTLD managers meetings, which Dengate Thrush chaired for five years. That persistent presence at high-level meetings and the determination of New Zealand to have its say on major issues, allowed Domainz to ‘develop enduring relationships’ with some of the key parties in the discussion, said O’Brien.[28]

Awkward alliance

In March 2000 security company VeriSign[29] announced its intention to acquire NSI for US$21 billion. The surprise deal united the world’s leading provider of Internet domain name registrations, with VeriSign the leading US provider of e-commerce and email security. At that time, NSI had registered more than ten million domain names. VeriSign was working on its proprietary Advanced Transaction Lookup and Signaling (Atlas) DNS platform, which promised to provide roughly 15 times the throughput of the Berkeley Internet Name Domain (BIND) platform that NSI had been using. Five months later, in November 2000, the number of domain names registered by VeriSign had more than doubled to more than 24 million, and it was processing an average of 1.5 billion DNS look-ups daily.

By 2001 InternetNZ could rightly claim that it had been instrumental in drafting some of the best practice guidelines for country domain managers within ICANN.[30] However ICANN was now requiring a three-way contract with the ccTLD operators, itself and the government of the country concerned. ICANN threatened some of these operators by refusing to re-delegate their rights to manage the country codes unless they signed the contract and paid the fee. Japan and Australia agreed; New Zealand remained in stand-off mode. After about five years ICANN finally admitted it may have had the wrong formula.

When he visited New Zealand in 2003 at the invitation of InternetNZ, Vint Cerf, head of the board of ICANN, admitted the effort to come up with a structure for Internet domain administration was ‘in turmoil from day one.’ He was confident a more constructive attitude now prevailed and was apologetic about how country code managers had been treated.

Democratically minded individuals and bodies insisted on public elections for the senior ICANN positions, but it was more difficult than it seemed. “We didn’t clearly know who our constituencies were” and ICANN faced the prospect of “expending a lot of resource to produce a not-very-good result,” he said.

Some national constituencies, such as the Germans, were more energetic than others. Cerf said it was becoming a circus, when the goal was simply to make the domain name system work. He said the multiple-registry system had its drawbacks, threatening to introduce inconsistency of service and a needlessly competitive atmosphere between national and international TLDs trying to attract customers.

Since ICANN didn’t have the power of a government or international regulatory body, it was thought contracts were the best way of ensuring consistent performance. However ccTLDs had predominantly resisted the contracts ICANN attempted to make them sign.

Ironically it took until 2004, four years after the initial request to ICANN to delete Waikato University as the technical contact for and replace it with InternetNZ. ICANN had maintained the shift from Waikato constituted a redelegation and therefore required a new contract. “This was part of deliberate pressure to try and force to sign a contract,” said Dengate Thrush. InternetNZ maintained its independent stance and was still questioning whether even the exchange of letters was necessary.

During 2004 ICANN began offering the concept of ‘accountability frameworks’ to ccTLDs, rather than trying to force contracts on countries. These and the new fees were generally more easily negotiated, but progress remained gradual, and only a handful more country code operators came on board. By 2006 it had pulled back to an ‘exchange of letters,’ essentially acknowledging each party’s right to co-exist. This proved the right formula, with more than 50 operators signing in the following year. As at mid-2007 none of the root server operators or the regional Internet registries had signed contracts with ICANN. A handful of country code operators acquiesced to what one of the New Zealand observers called the ‘draconian contracts,’ but only under duress.

There remained some contentious examples of ccTLD management. “A guy from Boston got the delegations for Niue and while he’s been giving money back and providing free Internet, the government has been fighting to get it because they see it as a cash cow. In Tonga it’s similar; you can use for a lot of things, and the same goes with for Tuvalu. A bunch of country codes are seen as valuable and lawyers have made a lot of money over this kind of issue,” said Jim Higgins. InternetNZ continued to discuss the possibilities of a stronger relationship with ICANN possibly through an exchange of letters rather than a formal contract.[31]

In hindsight Higgins believes the US government didn’t really want to let go of the Internet. “There was huge hostility from most of the countries over managing the country codes. Attempts by the ITU to take over administration of the Internet in more recent times had been just as frightening for many people.” Under the aegis of the ITU, some members feared the Internet could be dominated by undemocratic governments or hijacked by those who wished to censor it or push their own ideological views.

Peter Dengate Thrush, however, believed the element of control still left in the hands of the US Government’s Department of Commerce was relatively minor and symbolic. “People generally participate in ICANN because they believe it will become the management authority for location of Internet resources and the US Government will honour its undertaking to transition management to ICANN control.” Currently the United States retains the contract to manage the Internet numbering administration function and one of the terms of that contract is that any change to the root, the core file of the Internet Root Server hosted by VeriSign, needs to be approved by the US Department of Commerce. It is also responsible for the key IANA files for country codes.

As a member of the ccTLD leadership group Dengate Thrush pushed through a proposal for a new body within ICANN where ccTLD managers could have their own direct representation on the board. This body is now responsible for ruling on who can change a ccTLD manager. The proposal for the ccNSO body was first discussed in 2000 and formed in 2004. At the end of 2004 Dengate Thrush was elected as one of its first directors on the board of ICANN.

He said this greatly enhanced the ability of country code managers to meet within ICANN and discuss their relationship with the body, particularly around requirements for managers, the funding of ICANN, and issues of best practice. “The changing of country code managers is the most sensitive of all, and still requires final approval from the US Department of Commerce. While it has never refused any recommendation by ICANN, its role in the process is still like a red rag to a bull for many countries.”

GAC on track

Fears of conspiracies and unholy alliances continue whenever issues relating to Internet governance are on the international table. There was a time when ICANN’s GAC was viewed as a secret clique of political lobbyists trying to infiltrate and manipulate Internet-related policy making.

Frank March, senior telecommunications policy advisor with the MED and the government’s official GAC representative, said it’s better understood and less feared today. “There has been a lot of resentment around the fact that the GAC has operated on a different basis, and kept its meetings closed so people didn’t really know what was going on.” The closed sessions in fact had more to do with the sensitivity of the various government representatives about discussions on incomplete policies they didn’t want in the public arena. “It got carried away to a ludicrous extent for a time but ICANN is maturing and there’s a strong move to open up the meetings to the same level as other ICANN gatherings.”

One overarching concern was the debate around the involvement of the ITU. “The ITU has been looking for a role for itself since IPNetworks displaced the old switched circuit networks. The whole telecommunications power base virtually ignored the Internet and then they tried to take it over. There was a great deal of resistance from the Internet community objecting to the involvement of the ITU,” said March.

The tension goes back to the 1997 ITU plenipotentiary meeting, when it called a World Summit on the Information Society (WSIS). The first meeting, held in Geneva in 2003, saw a number of issues raised about Internet governance. “The issues are manifold, deep and multifarious but basically come down to a tension between whether national governments should be doing things, whether international organisations should be doing things or whether the open Internet should be left strictly alone and more or less in the private sector. Obviously this affects ICANN and GAC.”

There was talk of trying to bring the Internet under the umbrella of the United Nations with the UNCTAD, the ITU, the WIPO, and the International Chamber of Commerce having permanent membership. Even ICANN president Paul Twomey was excluded from a meeting of government representatives, underlining concerns that there was a conspiracy for governments to take a greater control in Internet governance and the management of their own domains. Twomey, as reported by the New York Times in a phone interview, said “at ICANN, anybody can attend meetings, appeal decisions or go to ombudsmen, and here I am outside a UN meeting room where diplomats – most of whom know little about the technical aspects – are deciding in a closed forum how 750 million people should reach the Internet. I am not amused.”[32]

Caught up in the mix is the fact that the US retains control over changes to the root for the DNS and through the Department of Commerce gives ICANN its legitimacy in terms of running the Internet. The main concern according to March, comes from developing nations in Africa and from the Middle East and Asia. “China, a rising world power on every front is concerned it doesn’t have as much acreage in the Internet as it feels is desirable. It’s these questions of governance and control that continue to provoke debate, largely because ITU is a governance and control organisation, largely under the auspices of the UN.”

March took a leave of absence from his role at the MED in 2005 to become a paid member of the United Nations Working Group on Internet Governance (WGIG), based in Geneva for six months. In the lead-up to the meeting where the findings of the group were to be reported, the International Herald Tribune gave an overview of what it described as the ‘global tempest’ brewing over control of the Internet:

Internet un?

Internet governance continued to dominate conversation at the second WSIS gathering in 2005 at Tunis. While the talk mainly centred on ways to bridge the digital divide between technology-rich and technology-poor countries, ITU secretary general Yoshio Utsumi made the claim that increased ‘regionalisation’ of the Internet in the near future would mean the ITU would be called upon to take over in five years’ time. Again the conference rejected the idea of domination by the ITU and government interests in favour of the present ICANN structure, at least for the present. Utsumi, however, commented: “The Internet need not be one net controlled by one centre … Regionalisation has already started and I suspect in a few years, the simile of the Internet will be a quite different one.”[33]

A further summit was staged in Morocco in 2006 with the core issues outlined in the WGIG Report still unresolved. The ITU Internet Governance Forum (IGF) in Rio de Janeiro in November 2007 was expected to come up with a plan for the next five years, looking at issues that “theoretically were not being looked at by any other body,” said March.

Grave suspicion remained about the motives of the ITU. “Although the GAC is being more effective and has taken some of the pressure off, most members remain opposed to the ITU taking a strong role.” Those who favoured such a move largely wanted governments to maintain an interest in public policy issues. “It’s hard to pin down what the ITU’s exact intention is, but for the moment anyway they seem to be more focused on the domain name and IP addressing systems.”

The only influence governments had on ICANN and its governance of the Internet at present was through the GAC. There were numerous bodies with input into policy debate around Internet governance. The most prominent were the Internet Society, a private sector international organisation, which had nothing directly to do with ICANN or Internet governance, but was involved in policy development and engaged in assisting developing nations with Internet growth. ISOC gained financial stability when it took over management of the domain registry from VeriSign.

ICANN itself, March said, had developed a greater understanding about why governments do things the way they do, and had built a strong ‘civil society’ representation with members from international women’s IT organisations, developing countries, and interested parties now making up one third of the seats. This model for relationships was widely adopted and opened the eyes of a number of governments about the level of dialogue that was going on. “People are beginning to appreciate how deep some of the public policies issues are.”

Whether the New Zealand Government should apply to take over was another issue that remained a possible but unlikely threat to InternetNZ. Some governments had already done this, including South Africa. In Canada the government set up a private sector organisation to run; in Australia there was a bit more government control, although a private sector group now runs the country domain. “InternetNZ is doing a good job but there are definite issues in ensuring is run properly.

Given that I’m chairing the InternetNZ .nz Oversight Committee it is my job to make sure it is run properly,” said March, who insisted this was not a conflict of interest with his government ‘day job.’

The only challenge that has come even close to challenging the local Internet governance model came in the wake of the BankDirect phishing scam, when the Reserve Bank sought a review of the process of registering and managing domain names. BankDirect customers were targeted on 26 September 2005 and a month later ASB Bank and BNZ customers were hit with a similar scam, with emails seeking to ascertain customers’ personal banking details. In the case of BankDirect, someone had established a bogus web site and was using the bank logo and a message purporting to be an ‘anti-fraud notification’ redirecting customers to the false site stating: “ERROR(XCF1P1) We were unable to process your recent transactions on your account. To ensure that your account is not suspended, please update your information.”

The web site was eventually taken down but no one would acknowledge who had taken the action. This provoked a direct challenge to InternetNZs ‘first come, first served’ policy, which had been fundamental to its operation since it was formed. A number of organisations suggested the way domain names were registered should be modified and tightened up, and there was ongoing consultation over this. “People often make such statements without digging below the surface. Every member of the Oversight Committee is of the opinion that the parties have failed to think through the consequences of these submissions, but it’s clear they have to be taken seriously,” said March. The Reserve Bank’s observations could be dismissed as being ‘largely ignorance’ while State Service Commission concerns appeared to largely come from a single individual. “Looking at it from a policy and a services point of view I think InternetNZ is extremely well run, particularly now there’s a trademark and domain name dispute resolution framework in place,” said March.

Red light realty rejected

Meanwhile a bid to create a virtual red light district on the Internet was blocked by a ‘coalition of the unwilling,’ consisting of unlikely bedfellows: the United States, Australia, and Iran. At ICANN’s 25th international meeting, in Wellington in March 2006, more than 700 delegates from 82 countries gathered to discuss a range of issues relating to the Internet’s growth, security, and stability and to consider its 2006–2009 ‘future directions’ strategic plan. It expected to take a final vote on creating a top level domain for adult content on-line, an issue which had already been deferred twice previously, when the GAC, unable to reach consensus, decided more work was needed to protect the public interest.

The GAC argued a range of restrictions and protections against illegal and offensive material made in initial undertakings by .xxx’s backer, ICM Registry, were absent from the contract the board was proposing to ratify. Several members of the GAC were emphatically opposed from a public policy perspective to the introduction of a .xxx sTLD (sponsored top level domain) including government representatives from the US, Australia, and Iran.

“It’s kind of ironic that you’ve got a kind of coalition of the unwilling here working together to block this thing,” said InternetNZ president (2005–2006) Colin Jackson. “We don’t have a formal position on the morality of having a .xxx domain. That’s not for us to say, but we do believe strongly that if you’ve got processes, they should be followed, and you shouldn’t have governments trying to overturn them or work outside the process.” Some commentators, including former European vice-president Elly Plooij-Van Gorsel, in a letter to Britain’s Financial Times, said this was further evidence of the undue influence the US Government had over the body and would rekindle calls for ICANN to be replaced by a more neutral body.

Jackson hoped pressure wouldn’t be renewed for ICANN to relinquish its governance of the Internet. “The alternative is a UN process which is extremely difficult and expensive to navigate and, frankly, has very, very poor accountability.” He believed ICANN served the global Internet community reasonably well. “It has an ideal of being an open, transparent, bottom-up, multi-stakeholder body. Unfortunately, I think it has fallen rather short in a couple of things recently. For all its flaws, it’s still a lot better than essentially handing over control of the Internet to a large intergovernmental bureaucracy.”[34]

Many saw the triple x domain as the ideal place to isolate pornographic content so it could be better managed and policed, and, where appropriate, filtering could be put in place. However the White House opposed anything that might be seen as condoning the porn industry. The other opponent of the move, Australia, claimed it could lead to ‘an increase in offensive content’ on the Internet, a position supported by Iran. The final statement at the following meeting in Lisbon confirmed governments remained divided on the issue, with some strongly opposed and others seeing it as an issue where ICANN’s own policies needed to be followed correctly. The ICANN board by a narrow majority voted against adding the domain to the Root Server.[35]

Two recommendations on how to halt specific denial of service (DoS) attacks were also heard at the Wellington meeting. A third, key issue that didn’t make it to the agenda was the acrimonious debate over renewal of a contract with VeriSign. Internet computers interacted with VeriSign millions of times a day to find out how to route email and Web traffic, but some critics considered VeriSign a monopoly that tried to abuse its power by offering services to boost its earnings. Instead of debating the issue in Wellington, ICANN’s directors agreed in a telephone conference to continue VeriSign’s control of all dotcoms for another six years, until 2012, with a ‘presumptive right of renewal.’ VeriSign was paid a fixed sum around NZ$9 every time a dotcom domain was registered or renewed. With 32 million dotcoms in existence, the business has been described as one of the most profitable on the Internet, VeriSign having the power to boost its fees by 7 percent each year.[36]

Peter Dengate Thrush, co-chairman on the ICANN strategy committee, continued to be engaged in the process of shifting final control of the Internet away from the US Department of Commerce and transitioning ICANN from being a US-registered corporation to an international body. “We wouldn’t have got this far without the support of the US but then there are equally difficult questions when people propose a United Nations-based body. The United Nations would spell the death knell for the speed of innovation that has made the Internet so successful. UN bodies do not have a track record for quick adoption, nimble policy making or responsiveness to technology or community issues. Most of us hope the new body will be substantially like ICANN because we’ve worked hard for a decade to get the right balance between registries, registrar and registrants. This is a genuine bottom-up process.”

Agreeing on the next phase for an institutional structure, and getting the buy-in from current players and governments when there were so many vested interests was not going to be easy. “The international law of the seas took 400 years, so ICANN as an international body has made incredible progress by those standards through meeting every four months somewhere in the world. We will just keep transitioning until we get there.”

InternetNZ finally formalised its relationship with ICANN through the signing of an exchange of letters at the end of October 2007. This meant that InternetNZ officially recognised ICANN’s role in co-ordinating the root services of the Internet, and consequently ICANN officially recognised InternetNZ’s role as the ccTLD manager for .nz.

The signing ceremony took place at a meeting of the ICANN board in Los Angeles, attended by InternetNZ and ICANN representatives including retiring chairman Vint Cerf, ICANN president Dr Paul Twomey, InternetNZ president Peter Macaulay, InternetNZ executive director Keith Davidson, and domain name commissioner Debbie Monahan.

Keith Davidson said the exchange of letters formalised a long-standing and mutually beneficial relationship since ICANN’s inception in 1998.[37]

Three days after the ‘exchange of letters,’ on 3 November 2007, Peter Dengate Thrush was elected chairman of ICANN at its meeting in Los Angeles, succeeding ‘father of the Internet’ Vint Cerf in one of the most influential global roles in Internet governance.

He remained convinced the Internet was still in its early days. “It’s like manned flight; we’re only at the stages of the first crossing of the English Channel. We spent all this time on getting graphical user interfaces right but our children find typing emails as a means of communicating about as useful as tapping away on Morse code down a telegraph wire. Biological interfaces are already being researched. I remember saying a decade ago at an InternetNZ meeting that the Internet would one day become so essential that being deprived of it would eventually be regarded as severely as being deprived of oxygen.”


[1] ISOCNZ AGM 23 June 2000:

[2] ISOCNZ meeting minutes, 23 December 1999, quoted by Peter Dengate Thrush

[3] ISOCNZ AGM, 23 June 2000

[4] Motions from the council meeting of the ISOCNZ Inc held at Museum Hotel de Wheels, Cable Street, Wellington, 7 July 2000

[5] Council Motions, 7 July 2000:

[6] Precis of article: ‘Anonymous calls tipped off Herald to billionaire case,’ Matthew Dearnaley, 31 August 2000

[7] Latin from the beginning or relying on first principles or established laws of nature

[8] Paul Brislen, ‘ISP threatens to sue Domainz,’ Computerworld, 28 August, 2000

[9] Russell Brown, ‘Domainz CEO walks,’ Computerworld, Monday, 4 September, 2000

[10] Ibid

[11] Russell Brown, ‘Domainz CEO walks’

[12] Doug Mercer’s ‘SRS Final Implementation Report,’ 8 September 2003

[13] Review of Registry Structure of the .nz ccTLD, Working Group Final Report, 20 October 2000

[14] Russell Brown, ‘Domainz system still not stable, says new CEO,’ Computerworld, 21 November 2000

[15] Doug Mercer’s ‘SRS Final Implementation Report,’ 8 September 2003




[19] (this is only the oral submission for some reason)

[20] Tom Pullar-Strecker, ‘Internet Society’s tangled Web,’ Infotech, 16 July 2001

[21] Paul Brislen, ‘Domain name commissioner wanted,’ Computerworld, 19 February 2002

[22] Paul Brislen, ‘Domainz sale a “win-win” situation,’ Computerworld, 21 August 2003

[23] InternetNZ Annual Report April 2003–March 2004

[24] ‘The start of the global governance debate,’ from ISOCNZ Council minutes, 3 December 1997, Supplied by Sue Leader

[25] ISOCNZ Council Minutes, 14 April 1998, ISOCNZ Submission on the Magaziner paper:

[26] ISOCNZ Minutes, 22 August 1998, “IANA report back”

[27] NZ Herald, 4 May 1999

[28] Stephen Bell, ‘The keeper of the keys,’ CIO, December 1999

[29] VeriSign was founded in 1995 as a spin-off of the RSA Security certification services business with licences to key cryptographic patents. Its Internet Services division includes Naming & Directory Services, which house the DNS for .com and .net, as well as other DNS-related services

[30] Sue Leader, ‘Challenging old processes with passion and idealism,’ opinion piece, Infotech, 10 December 2001

[31] InternetNZ-ICANN Exchange letters, The Browser, InternetNZ, March 2007

[32] Stephen Bell, ‘Internet too US-centric, say summit delegates,’ Computerworld, 11 December 2003

[33] Stephen Bell, ‘Governance still overshadows WSIS,’ Computerworld, 30 November 2005

[34] Adam Bennett, ‘Unlikely bedfellows block Internet porn,’ NZ Herald, 31 March 2006

[35] Lisbon ICANN meeting, 10 May 2007

[36] ‘Internet conference focuses on Web attacks,’ NZ Herald-NZPA, 28 March 2006

[37] InternetNZ and ICANN in Exchange of Letters Media Release, 31 October 2007