Re: 60 day waiting period

[Vince Wolodkin <wolodkin@digitalink.com>]

The below makes perfect sense.  I would question the $1 million social
benefit.  I think it is kind of high, but even so it doesn't matter. 
Since all domains have to be treated equally. a popular website will
easily generate $10,000 in ad revenue in 60 days.

In fact, where I work at washingtonpost.com, we far exceeded the $10,000
mark in our first 60 days.  Our ad revenues double every quarter, so a
delay of 60 days would be costing us quite a lot of money.  In fact
delays of 60 days on other projects would have allowed competitors to
beat us to market.

Vince Wolodkin

Jerry Harder wrote:
> 
> Let's try a different approach: a specialized form of a cost benefit analysis.
> 
> Define the following model:
> 
> Number of domain names to issued over the relevant period of time
> 
> Proportion of domain assignments that result in law suits or expenditures on the part of domain name applicants and trademark holders
> 
> Proportion of law suits and challenges that can be prevented with the policy under consideration (60 day wait)
> 
> Average benefit of an avoided law or challenge
> 
> Cost to domain name applicant of policy
> 
> Instead of independently calculating the latter, I will simply calculate the breakeven benefit. If the cost is greater than the benefit, then the policy should not be adopted. If the benefit is greater than the cost, then the policy should be adopted, unless someone can develop a policy with greater benefits less costs.
> 
> For a example, with numbers that are illustrative only:
> 
> 750,000 domain names to be issued
> 
> .01 (1 in 100 domain names), proportion that results in challenges or law suits
> 
> 1, proportion of challenges and suits that can be avoided with adoption of 60 day waiting period
> 
> $1,000,000 social benefit per law suit or challenge avoided
> 
> Multiplying 750,000 * .01 * 1 * $1,000,000 = $7,500,000,000 in social benefits
> 
> Dividing by 750,000 (number of domain names) gives a breakeven social benefit of $10,000 per domain name.
> 
> If the costs of the 60 day waiting period are greater than $10,000 per domain name, then the policy should be rejected. Otherwise, adopt the policy and the difference between the actual cost and the breakeven cost is the average social benefit per domain name.
> 
> (The social cost is approximately the revenues that would be gained without the 60 day waiting period less any expenditures not made due to the policy.)
> 
> Obviously some of the numbers in the model are not realistic, but the members of this list are well positioned to give us much better numbers.
> 
> The lawyers, should be able to help us refine the proportion of law suits per domain name, the proportion they expect to avoid with the 60 day policy, and the social benefit of an avoided challenge or law suit. Some of the IAHC members, can at least confirm some historical information about the number of domain name assignments and what they think are the likely number of assignments in the next two or three years. Last, but not least, our more entrepreneurial  members should have a good feel fo
> 
> The model can certainly be refined by adding additional costs and benefits. One benefit identified for the policy in previous messages is URL stability. What would be an appropriate monetary figure for that social benefit?
> 
> Jerry Harder
> Senior Partner
> RTA, Inc.