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auDA Surprise: Ends Exclusive AusRegistry Negotiations, Wants to “Build and Operate” Own Registry

The .au policy and regulatory body auDA dropped something of a bombshell Wednesday when it announced it was ending exclusive negotiations with AusRegistry, the registry operator since 2002, and will undertake a restricted tender exercise, by invitation.

The Australian country code top level domain (ccTLD) is operated under a model that is not very common – auDA deals with policy and regulation as well as dealing with contractual issues for who runs the registry and what is expected, while AusRegistry, which is now owned by Neustar, runs the registry.

Under the contract held by AusRegistry to run the registry, registrations for .au domain names have grown from around 307,000 at the end of November 2002 about the time when AusRegistry commenced registry operations to 3.115 million today. It was the ninth largest ccTLD at the end of December 2016 according to the latest Verisign Domain Name Industry Brief.

The announcement by auDA this week follows a prior announcement in December 2016 saying auDA had entered “a period of exclusive negotiation with AusRegistry for the management of auDA’s registry operations beyond 2018.” This followed an unsolicited offer in November from AusRegistry “to continue those services beyond the current contract.”

According to yesterday’s auDA announcement, attributed to by Chair Stuart Benjamin, “this process will commence initially with a scoping exercise, sourcing expert advice so auDA can build and operate a dedicated .au registry.” [emphasis added] auDA says “AusRegistry will be invited to participate in the restricted tender process, as will other operators, once the scoping exercise and tender documentation is complete.” But it seems auDA has made its future clear.

The announcement seems to go against previous industry consultation, which auDA periodically undertakes as part of its role to work with the domain name community in Australia.

One of the consultations auDA undertakes is an Industry Advisory Panel that includes a broad number of people from the domain name industry – from AusRegistry, registrars, community groups and internet users. And the industry panels have recommended in 2008 and 2012 that the existing setup of auDA as the policy and regulatory body and a separate registry should be retained.

The 2012 Industry Advisory Panel recommendations to the auDA Board included Recommendation 1A that reads:
a) the competitive registry model should be retained;
b) auDA should initiate renegotiations with AusRegistry to extend contractual arrangements for 2, 3 or 4 years;
c) auDA should seek stakeholder input on relevant negotiating factors prior to the renegotiations with AusRegistry;
d) if renegotiations with AusRegistry fail, auDA should proceed to conduct a formal RFT process; and
e) the auDA Board should publicly commit to undertaking a formal RFT process once the renegotiated registry agreement expires.

Likewise in 2008, the panel recommended “that the existing competitive registry model should be retained with future licence terms to be increased from the current 4 year licence term to either a 6 or 8 year licence term” and “that auDA negotiates with the current registry operator with a view to extending the current registry licence term by up to 4 years.”

For now though one can assume industry players are digesting auDA’s surprise announcement and working out a way forward.