From: Anthony Peake  
Date: 1 June 2011 3:49:55 PM AEST 
To: lujia.chen@auda.org.au 
Subject: Netfleet response to auDA Secondary Market Working Group, 
Issues Paper, May 2011

Lujia, 
 
Please find below Netfleet's comments on the issues and proposals outlined by the 
Secondary Market Working Group, Issues Paper, May 2011. 
 
Consumer Issues 
1. Registrant transfer process and fees. 
We support the Working Group proposal for a process which "requires registrars to 
send a transfer confirmation request to the registrant contact email address, and 
receive a positive response before proceeding with the transfer". Just to clarify this 
point further we believe that this email and confirmation should replace the 
existing paper/fax based systems currently in use by registrars. We believe that this 
would benefit consumers as the lack of administrative overhead involved in the 
process should lower the transfer (Change of Registrant) cost to that of a domain 
Registration. 
 
2. Six month prohibition on transfers. 
We find that there is confusion over how a registrant can apply to auDA for 
authorisation to transfer their domain name as paragraph 4.2 of the Transfers 
Policy states that "A registrant may apply to auDA for authorisation to transfer 
their domain name licence" without pointing out that the registrant needs to 
involve the registrar in the process. If the 6 month rule remains then some 
clarification on this in the policy might be prudent. 
 
Having 10,000 members and 40,000 domains listed on Netfleet, we have found 
that any speculation made by domainers tends to be based around long-term 
growth and development, so the 6 month rule has little impact on reducing 
speculation - it’s original stated aim. We have also seen no evidence that 
domainers are registering domains with the intent to sell them in the short-term. 
Even the most naïve investor would be unlikely to think that a domain name that 
had never before been registered, just happened to have been overlooked for all 
these years and could be hand-registered and sold for a healthy profit the next 
day. 
 
In keeping with the emphasised rationale from the 2007 Names Policy Panel "to 
give people access to domain names that would not otherwise be available, and 
allow the transfer of domain names to those who have best use for them" and 
since the existing 6 month rule does not seem to deter nor promote any particular 
behaviour, only adding administrative overheads to auDA, sellers and secondary 
marketplaces. We think it is beneficial to relax the 6 month rule and give people 
access to domains names as soon as they are registered. 
 
3. Drop catching services. 
As a provider of "Drop catching services" we believe it is beneficial to potential 
registrants that they are made aware of our services before a domain has been 
purged by the registry as we occasionally encounter parties wishing they had 
known about our service 24 hours earlier. We would volunteer to participate in an 
approval process which allowed auDA to direct relevant registrants to our 
services. A link to an auda.org.au page explaining drop services in the whois 
results for domain in state pendingDelete and serverRenewProhibited would go a 
long way to help educate potential registrants about the existence and operation of 
registrars specialising in providing "Drop catching services". 
 
We occasionally encounter registrants who were only aware of our services and 
are frustrated that we "lost" their domain to a competitor. Both dominant "Drop 
catching services" currently operate on a no win no fee basis to be as fair as 
possible to these registrants and while it is not in our interest to promote 
competitors we do feel that it is in the registrants interest that auDA make them 
aware of other "Drop catching services". We would also like to make the point 
that any manipulation of the marketplace to encourage more registrars to engage in 
drop catching would mean registrants will need to 'cover their bases' on more 
platforms. 
 
4. Domain name sale listings. 
Netfleet has already committed itself to a process of reducing the number of 
listings which are out-of-date. All expired or available domains are removed from 
the aftermarket on a daily basis.  We agree with the Working Group belief that it 
is the providers responsibility and best interest to reduce out-of-date listings. 
 
Industry Issues. 
1. Registry operations. 
It is interesting for us to see the purge process taking more than 15 minutes 
instead of just 1 minute however, like the Registry, this is not a cause of concern 
for us. As participants we foster good communication to ensure that the Registry 
is never at risk and would attempt to resolve any concerns as quickly as possible. 
It is maybe worth noting that this paper mentions blocking EPP Create commands 
for 15 minutes before and after the Purge Cycle, which might need to reviewed in 
light of the longer than usual purge process, to ensure it is not being circumvented. 
 
2. Registrar connection sharing. 
We support the Working Group suggestion that auDA publish a policy which 
specifically prohibits connection sharing between unrelated registrars, to address 
security and privacy concerns. We would like to note that multiple dedicated drop 
catching services have been in operation for about three years now without any 
flooding of the market with "shell" registrars. During these three years there is also 
evidence of smaller registrar groups dominating the market. It would seem unfair 
to try to restrict large registry groups because of an unfounded belief that EPP 
connections equals greater success. 
 
3. Registrar competition. 
By providing a public auction the "Drop catching service" providers are producing 
a level playing field for the Consumer.   
Snapping expired domains is not just down to the number of Registrars in a group. 
Domain8 proved this two years ago when it took on Domain Watch's four 
registrars and Netfleet's five registrars using only one registrar initially and two 
registrars for most of its success.    
It might be worth noting by competitors that it takes many years to create an 
"overnight success" like Netfleet. The biggest barrier to entry is the effort required 
to keep trying for two years before seeing success. If any other competitor 
invested the same effort they will also see some success. We do not think that 
auDA nor the Registry have any obligations nor right to help new teams become 
better. With regards to the risk of new competitors destabilising the registry we 
believe that the OT&E environment together with open communication with the 
Registry is enough to ensure your domain snapping software is safe to use. 
 
Regards 
Anthony Peake 
Netfleet.com.au