In a widely expected move, Network Solutions Inc (NSI) and the National Science Foundation (NSF) have announced that the setting aside of 30% of domain name registration fees into the so-called Internet Intellectual Infrastructure Fund will end April 1. The elimination of the fee will cut the annual cost of registering domain names with NSI from $50 a year to $35 and the bi-annual fee from $100 to $70. Since registration fees were introduced in September 1995, the NSF and NSI says more than $45.5m has been deposited to date, but some in the industry believe the total is actually between $50m and $60m. Last October Congress authorized the allocation of $23m of the fund to support the government’s Next Generation Internet project linking universities with high-speed pipes. NSI’s five-year agreement with the NSF to manage domains in the .com,. .net and .org space ends March 31, though a six month transition period will extend it to September 30. The fund is also the subject of the lawsuit brought by attorney William Bode of Washington DC-based Bode & Beckman LLP, alleging it is a unconstitutional tax and it all should be refunded to the internet community. As we reported yesterday, the case is expected to get a ruling within three weeks, following the judge’s request that the lawyers for NSI better explain the case, after the NSF’s lawyers failed to do so. Aside from the government’s seeming inability to find a lawyer competent enough to fight the suit, which is a class action, Bode’s case and other actions – such as PG Media’s anti-trust suit against NSI (NBD 07/08/97) – are causing real concern among the internet community. Put simply, the fear is that if the NSF is found not to have the authority to order NSI to stop adding names to the internet DNS (which PG Media’s case seeks to prove) or that the NSF did not have the authority to grant NSI permission to introduce the fee without putting the contract out to competitive tender again, then a free-for-all will ensue, which could lead eventually, to government intervention, which is not what anyone – including the government – wants to happen.
