YNOT – Adult industry trade organization Free Speech Coalition remains optimistic the sponsored Top-Level domain proposed to house adult entertainment websites will not become reality, despite a Friday vote by internet regulatory body ICANN that dot-xxx be allowed to proceed toward activation.During a public meeting in Brussels, the board of directors for the Internet Corporation for Assigned Names and Numbers passed a resolution instructing the staff to reassess the merits of ICM Registry’s application to administer dot-xxx. However, FSC is convinced serious obstacles to the proposed sTLD remain, both inside and outside ICANN’s board.

“Several board members expressed deep reservations at having to vote on a resolution they did not consider completely accurate,” the FSC noted in a prepared statement following the vote. “Essentially, the board resolved that, although they had not made a determination as to whether they agreed with the findings of the majority of the independent review panel, they would accept and act in accordance with some of the panel’s findings.”

In February, an international arbitration tribunal, convened at ICM’s request, reprimanded ICANN for violating its own bylaws when it withdrew approval from dot-XXX in 2007 after granting preliminary approval two years earlier. The panel also strongly advised ICANN to rectify the error. Shortly thereafter, ICM President Stuart Lawley suggested his company might take additional legal action if ICANN did not reverse its 2007 decision.

During Thursday’s open meeting in Brussels, both FSC Executive Director Diane Duke and board member Tom Hymes made clear to the ICANN board FSC’s position on dot-xxx. According to FSC, members of the so-called “sponsoring community” overwhelmingly oppose the creation of dot-XXX, fearing it will provide leverage for forcing adult websites into an online “smut ghetto” and facilitate unwarranted international censorship of legal adult content. In addition, the creation of dot-xxx very well could put ICANN in a position requiring the international, non-partisan body to regulate online content in clear violation of its own charter.

“It is clear that we made an impact,” Duke said. “ICANN board members were extremely uncomfortable knowing that no support exists for a dot-xxx sTLD in the sponsoring community.”

Hymes said he got the impression ICANN’s board perceives a particularly sharp sword of Damocles in dot-xxx.

“My feeling is that the board is painfully aware of ICM’s threat to sue ICANN, and was forced to pass a resolution that many of the board members feel is at odds with the truth. This is not speculation,” he said. “At the meeting [Friday], several said as much, and I can only add that I was deeply moved by their courage to do so under the circumstances. I do not fault them for acting to protect their organization, and I believe there are a plenitude of serious obstacles to the ultimate realization of this profoundly flawed application.”

During the discussion prior to the vote, a number of ICANN board members indicated they felt conflicted about the resolution.

Board member Harald Alvestrand kicked off the discussion, saying, “…effectively this forces me to say that it is in the best interest of [ICANN] and the interest of the furtherance of the organization’s goals to act as if something is true that I believe is not, in fact, so. This is a very uncomfortable situation, but I can see no better way to move forward.”

ICANN Chairman Peter Dengate Thrush responded, “Thank you, Harald, for a very concise explanation of the position that I think many board members find themselves in.”

Later, board member Bruce Tonkin summed up what the next steps in the process would be.

“The first couple of steps of the timing [are] probably more in the control of the ICANN staff and the applicant in that there will be, first, a due-diligence stage,” he said. “Secondly, if that due diligence is successful, then there is a stage where the draft contract is reviewed. But, ultimately, the key step then is for the board to decide whether the board feels that contract is in compliance with [Government Advisory Committee] advice.”

ICANN’s GAC weighed in on the matter once in March 2006 and again in March 2007. In both communiqués, the group mentioned concern about the sponsoring community.

ICANN board member Katim Touray pointed out that dot-xxx is far from a done deal, remarking, “As Bruce said, this game has still not played out yet. We still have quite a number of steps to proceed.”

ICANN Chief Executive Officer Rod Beckstrom voiced his concern, as well, saying, “While I accept the contribution to ICANN’s accountability and transparency provided by the existence and the use of the independent panel review process, I am nonetheless concerned about the determination by two of the three panelists that the ICANN board should not use business judgment in the conduct of its affairs. In my view as CEO, the board must be able to use business judgment in order to protect the global public interest in the coordination of the root of the internet and the domain name system.”

Duke did her best to untangle all of that.

“I believe that there are two key factors at play here: ‘ICANN’s internal review process and looming litigation from the dot-xxx sTLD applicant ICM,” she said.

ICANN developed an internal review process (IRP) as a mechanism for stakeholders to challenge board decisions. ICM was the first to use the process, which put significant pressure on the board to follow the IRP’s decision or risk losing all credibility in the process. Also, ICM CEO Stuart Lawley made it perfectly clear that if the dot-xxx application is not approved, ICM will sue ICANN, Duke noted.

“We heard in the board meeting, and you can read in the transcripts, that board members are concerned about what is good for the ‘organization,’” she said. “Avoiding an expensive lawsuit and saving face in the IRP process is good for ICANN but as ICANN’s CEO pointed out, it may not be in the best interest of the ‘global public interest.’ In the end, I believe that ICANN will do the right thing.”