There isn’t a perfect governance model – but ccTLDs should carefully consider if their governance model is right for them.
Summary of session
This session put on by the Country Code Names Supporting Organisation (ccNSO) discussed the different governance models of ccTLDs, with an aim to foster discussion amongst and within ccTLDs about whether their governance model was right for them.
The four governance models discussed in this session were (and represented by):
Non-for-profit model (DNS Belgium – .be)
Academic model (NIC Mexico – .mx)
For-profit model (Japan Registry Services Co. Ltd. – .jp)
Government model (Botswana Communications Regulatory Authorityv – .bw)
Firstly with the non-for-profit model, the speaker from DNS Belgium focused on the ability of that organisation to act beyond simply being a domain registry, and be at the centre of the Belgian internet. The social impact of the registry was really highlighted, with sustainability being a key goal of the organisation. It was posited that this would be more difficult to achieve under different governance models, with the non-for-profit model allowing for a singular focus on the organisation’s mission and values.
Under the academic model, .mx has been managed by the Monterrey Institute of Technology and Higher Education, with NIC Mexico being a related entity of the university. The chief benefits of this model were said to be the ability to engage in long-term strategic planning, and the budget and financial autonomy which comes with being part of an educational institution. The registry is able to leverage the latest advances in technology and is a significant ‘value add’ to the university. One challenge highlighted was that sometimes the dynamics between the university and the registry could conflict, and the ability of the registry to scale was limited by their inability to take on private investment. The insular nature of the university also inhibits the encouragement of a multistakeholder model within the .mx community.
JPRS, who manage the .jp ccTLD, is an interesting case as they began as an academic organisation, then moved to being a non-for-profit as the need for staffing increased. Even then, in the early 21st century with the rise of the internet and a dramatic increase in the registrations of .jp domains, JPRS was forced to become a for-profit organisation. This was in recognition of the increase in income JPRS was experiencing, and the need to implement a multi-year budget for the management of the ccTLD. Accordingly, JPRS now holds a contract from JPNIC to manage the .jp domain name as a for-profit organisation. More broadly, this was said to reflect the approach of the Japanese Government in allowing the private-sector to take the lead in Internet Governance.
In Botswana, the .bw ccTLD is managed by the Botswana Communications Regulatory Authority (BOCRA) – a government authority. While originally the ccTLD was managed by the University of Botswana, and then managed by a telecom organisation, in the aim on neutrality the Government took control of the registry. BOCRA runs at arm’s length from the government and aims to consult all stakeholders when making decisions. This principle in enshrined in legislation and ensures that BOCRA serves the community fairly and equally. The primary benefit of this model was certainty. BOCRA has certainty in funding through the Government and is able to be represented at governmental forums such as the GAC. This benefit can be a curse however, with funding being at the mercy of the bureaucracy of government, and the ccTLD being seen as a lower-priority effort of the authority.
So what’s the best governance model? Well… it’s probably the one which suits your situation.
Take .jp for example. When the internet was in its infancy, it made sense to first fall under the academic model, and then transition to a non-for-profit model. But does a non-for-profit model scale? In the case of .jp, that was the 1-billion-yen question, and the answer they evidently came to is no, non-for-profits can’t scale.
And that’s the impression I got from DNS Belgium also – but there, they were perfectly fine being focused on what they’re good at, and the lack of financial shareholders allowed them to keep their sustainable focus.
This is something I sometimes wonder, whether the corporatisation of public services means that they become too-big-too-soon, or too focused on returns to shareholders; and whether everything would be a bit better if organisations stayed small and focused. I mean, look, if your name is Larry Fink and you’re suddenly keen on for-profits being positive contributors to society vs profit-making machines, then all power to you. But generally, I think shareholders will be a little bit narky if you’re not making a nice margin.
So, I really commend DNS Belgium for their approach; and for sure, that’s the sort of non-for-profit organisation I’m all about – focused on their values, provides a good service, and keeps within their means. But, and here’s the distinction with .jp, it hasn’t (I’m not going to say won’t) scale.
.jp does scale. The amount of income flowing through that system, and the centrality of .jp to Japan’s internet, might be said to require the scale of economies that a for-profit can bring. JPRS exists to develop the domain name industry in Japan – not the Internet overall in Japan (although they do some philanthropic work around the edges). And hey, in the case of JPRS, some government encouragement in that direction didn’t hurt.
So, if you are dead-set keen for your TLD to be the hottest thing going on; purely in terms of being a TLD; then a for-profit model is probably for you. But, let’s say you’re more of a holistic person, someone who’s keen on social responsibility and sustainability (not to say for-profits can’t do that!). In that case, you might also consider a non-for-profit model, where you can be free to not worry so much about a return to shareholders.
But what about the academic or government model? Well, see these as mainly creatures of circumstance. NIC Mexico was really interesting to hear from, because I like the idea of the ccTLD and the university being so intertwined. But, and as highlighted in the session when discussing ccTLDs which had changed governance models over the year, this might not be a long-term solution. Universities aren’t usually keen on keeping quasi-businesses on their books, and the stats show many academic-driven ccTLDs being transferred to the government over the last year.
And as to those government ccTLDs, well that’s interesting in and of itself. Leaving aside issues of government interference (BOCRA was very clear that there is no government interference in how they operate the .bw ccTLD), I just don’t see the sustainability. Governments are fickle in how they allocate funding and aren’t particularly great at long-term planning. A government supported non-for-profit is likely the better solution, but I do recognise that it is possible that where it is important to have stability (for example, if you’re worried about ill-governance in the non-for-profit), then the government model can work.
The session ended with the host asking participants which governance model they liked the most; and the majority of participants said non-for-profit. The host then asked participants if they were likely to change model now that they had been part of the session; an even larger majority said they wouldn’t. For me though, someone who is about as far away from running a ccTLD as possible, it didn’t matter.
This session gave a great breakdown of the different models, and it was really interesting to hear from all the panellists about their different approaches and the different roles their ccTLDs took in their communities. All of them are ‘good’ governance, and in the end the session highlighted the need for proper consideration of governance model when establishing any kind of organisation.