Here in Dakar, delegates at ICANN 42 have been wrestling with this question. But, over four years and six editions of the Applicant Guidebook, ICANN has already developed an answer. The idea is for every new registry applicant to estimate the costs of “critical registry functions”, defined as: the maintenance of DNS resolution, a shared registry system, Whois, data escrow and maintaining a DNSSEC signed zone.

Then applicants have to multiply this estimate to ensure three years’ continuity and obtain an “irrevocable letter of credit” or make a deposit into an irrevocable escrow account to cover the estimate. For most dot-brand applicants, letters of credit are relatively inexpensive and easy to obtain. However, with 75 days left until the launch of the new gTLDs, the ICANN staff received a proposal from the Registry Stakeholder Group for ICANN to create a Continuing Operations Fund (COF).

The idea is for every applicant to place $50,000 per character string and $0.5c per domain per year into a risk pool, which could be characterised as an insurance fund and will pay out to casualties. In an occasionally acrimonious session here at ICANN 42 in Dakar, significant disadvantages with this proposal were identified: it requires wealthier brand owners with small and stable registries to support speculators possibly with no registry management experience whose business plans could fail.

The proposed COF could place ICANN in the position of being regarded as an insurance provider. Surprisingly, the idea came from registry operators who want to work with dot-brands. But it will put up the costs of every dot-brand applicant by at least $50,000.

Last-minute changes to the Applicant Guidebook that will benefit risky organisations at the expense of stable ones must be resisted.