Gravy train derailed

A wise uncle once gave me this sound advice: ‘My boy, if you ever find yourself onto a good thing, don’t mess it up’.

Until very recently, the people who ran Nominet, the company that administers .uk websites (like theoldie.co.uk), were certainly onto a good thing, but they clearly never knew my uncle.  They did mess it up, and in March almost half the board was brusquely ejected.

This ugly row lifts the lid on a part of the internet that most of us don’t even know exists.  However, it’s an essential component and has been providing a few people with a comfortable living for years – until they messed it up.

The Internet only works if we all obey some basic rules of the road.  One of those is that all website addresses must be managed by a registry.  Nominet is such a registry; the company’s job is to record website ownership, avoid duplication and manage some technical matters.  Only The Oldie can use www.theoldie.co.uk because Nominet prevents others muscling in.

Website owners pay a little to Nominet each year to maintain ownership, and in return Nominet manages everything for the public benefit.  It’s a ‘not for profit’ company and any surplus income generated is supposed to be used for charitable purposes.

That’s all right and proper; Nominet should be a very boring company, providing a reliable but essential service that lubricates the Internet.  Indeed, it’s a licence to print money, as it has a monopoly on the use of all those website addresses.  Hence it has a structure that was designed to mitigate this monopoly by channelling profits into charitable purposes.

And so it did, for many years.  However, in 2015 a new CEO decided that this was all too boring and expanded the company far away from its core registry work.  He invested in all sorts of fashionable things like driverless cars and cybersecurity.

Nominet’s users (known as ‘members’) became unhappy.  These members are mostly web companies that have to pay Nominet its fees, but in recent years they saw these fees increase by 50% as Nominet’s profits dwindled and its executives’ salaries soared (the CEO earned almost £600,000 last year).  They also saw millions of pounds lost on futile investments and annual charitable donations reduced from about £5m to less than £2m.

All the normal warning signs were there: board meeting minutes ceased to be published, the Chairman and CEO’s latest reports didn’t mention the losses, financial structures and reporting became opaque.  Members complained that they could not engage with the Board and the last straw seems to have been the abrupt closing (in the middle of the AGM) of an online forum which had been a means of communication between the board and its members.

Anyway, the members rebelled, and in March five of the 11 strong board were thrown out, including the CEO, who also resigned his job.  New board members started work.

So where does this leave us?  If Nominet fails, another registry will step in.  However, it all that leaves a sour taste in the mouth.  The original charitable ambitions seem to have withered on the vine whilst a few people have made a lot of money.

Perhaps the palace coup will restore a benevolent management, but so far I am not encouraged; the new board’s first act was to appoint one of the ousted board members as interim CEO.

I’m afraid that it’s all evidence that the internet is no longer the cosy club it was twenty years ago, and its infrastructure needs proper supervision.  Registries like Nominet should probably be run more like the DVLA. 

The row will encourage those who want to see more regulation of the internet.  Reluctantly, I think I am one of them.

Nominet’s website: https://www.nominet.uk/

https://publicbenefit.uk/ - this is the website of the activist group that started the row

ICAAN - https://www.icann.org/
 Internet Corporation for Assigned Names and Numbers – this the international body that oversees all registries and grants Nominet the right to manage the .uk addresses

https://uk.godaddy.com/help/what-is-the-difference-between-a-registry-registrar-and-registrant-8039
A good short video explaining the three different roles involved in the domain name registration process: The registry, registrar and registrant.