ICANN Threatens VeriSign

According to representatives for ICANN, VeriSign has until 9 p.m. (EST) on Saturday to disable Site Finder.

"Failure to comply with this demand by that time will leave ICANN with no choice but to seek promptly to enforce VeriSign's contractual obligations," ICANN's President and CEO Paul Twomey said in a statement.

ICANN's decision to get heavy with VeriSign is the result of findings from its Security and Stability Advisory Committee, which fired the first warning shots at VeriSign last week when it "advised" VeriSign to consider disabling Site Finder.

Since launching the Site Finder service on Sept. 15, Mountain View, Calif.-based VeriSign has been hit with three federal lawsuits from competing search service companies claiming unfair business practices and inappropriate use of its monopoly of the .com and .net domain directories.

VeriSign became the operator of the two single most popular domain suffixes on the web after acquiring Network Solutions several years ago. Network Solution's position as .com and .net operator was granted through agreements with the Department of Commerce and ICANN.

The decision to launch Site Finder entailed a major change in VeriSign's domain servers and created wildcard records in the .com and .net zone. Those records have the effect of causing a query for an unregistered domain name to succeed, and to return the address of a VeriSign-operated computer.

Prior to the launch of Site Finder, if a user attempted to access a service on a nonexistent .com or .net domain, they would receive an error message. But since the launch of the search service, VeriSign now directs that traffic back to its own network where it offers the user a list of likely alternatives, including some paid links.

Many critics of the service claim that in addition to being an unfair source of revenue for the registrar, Site Finder has a tendency to disable junk email filters and networked printers. There is also a contention that the service and the business ethics behind its creation threaten the stability and fairness of the Internet.

"Based on the information currently available to us, it appears these changes have had a substantial adverse effect of the core operation of the DNS, on the stability of the Internet, and on relevant domains, and may have additional adverse effects in the future," ICANN's Twomey said in a statement.

ICANN has been in talks with VeriSign over the past week, during which it agreed to give the search service more time and for VeriSign to continue to monitor public response to the service that it feels is a useful tool for lost web surfers. But not until today has ICANN taken aggressive steps to stop the service and confront VeriSign for breach of contract.

"VeriSign cannot avoid liability for their unlawful exercise of dominion over unregistered .com and .net domains," said Chris Hill, attorney for Popular Enterprises, a Florida-based company that filed a $100 million lawsuit against VeriSign on Sept. 19.

In its hefty suit against VeriSign, Popular Enterprises claims that Site Finder has been stealing traffic from its similar search site function Nester.com.

"VeriSign cannot legitimately claim to be providing a public service. What they are really doing is unjustly profiting from property in the public domain to the exclusion of every potential competitor," Hill continued.

VeriSign was not available to talk with XBiz, although the registrar has scheduled a press conference in Washington, D.C. for Monday, Oct. 6.