ISOC, PIR, and Ethos respond to Wyden, Blumenthal, Warren and Eshoo Questions on Sale of .ORG

Inside the Billion-Dollar Battle Over .Org

A private equity firm wants to buy the internet domain used by nonprofits. A group of online pioneers says it is not the place to maximize profits.

By Steve Lohr    • Jan. 7, 2020, 4:17 p.m. ET

Two months ago, Ethos Capital, a private equity firm, announced that it planned to buy the rights to a tract of internet real estate for more than $1 billion.

But it wasn’t just any piece of digital property. It was dot-org, the cyber neighborhood that is home to big nonprofits and nongovernmental organizations like the United Nations ( and NPR (, and to little ones like neighborhood clubs.

The deal was met with a fierce backlash. Critics argued that a less commercial corner of the internet should not be controlled by a profit-driven private equity firm, as a matter of both principle and practice. Online petitions and letters of concern came from hundreds of organizations, thousands of individuals and four Democrats in Congress, including Senator Elizabeth Warren of Massachusetts.

Rarely has the acronym-strewn realm of internet addresses — so-called domain names — stirred such passion.

Now, a group of respected internet pioneers and nonprofit leaders is offering an alternative to Ethos Capital’s bid: a nonprofit cooperative corporation. The incorporation papers for the new entity, the Cooperative Corporation of .ORG Registrants, were filed this week in California.

The goal of the group is not only to persuade the Internet Corporation for Assigned Names and Numbers, which oversees internet domain names, to stop the sale. It is also to persuade ICANN to hand it the management of dot-org instead.

“This is a better alternative,” said Esther Dyson, who served as the first chair of ICANN, from 1998 to 2000, and is one of seven directors of the new cooperative. “If you’re owned by private equity, your incentive is to make a profit. Our incentive is to serve and protect nonprofits and the public.”

Since 2003, dot-org has been run by the Public Interest Registry [ PIR], which is controlled by the Internet Society, a nonprofit that helps develop internet standards, education programs and policy. The registry holds a contract to manage dot-org, which was renewed last year for 10 more years. With a sale to Ethos Capital, the Internet Society would gain an endowment to fund its operations and get out of the business of operating dot-org.

In buying the Public Interest Registry, Ethos Capital [ FOR PROFIT HEDGE FUND] would acquire the rights to run dot-org and collect annual fees from the nearly 10.5 million registered dot-org names, held by both nonprofits and domain-name speculators. Those yearly fees are $10 to $20 on average, but can be far higher for big sites that buy several names to protect their brand and get added services like security against online attacks.

Opponents of the private-equity sale said they feared that to make an attractive profit on its pricey deal, Ethos Capital would have to raise prices, cut expenses, skimp on service — and most likely sell users’ data.

Ethos Capital said those concerns were unfounded.

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More on that:

ISOC, PIR, and Ethos respond to Wyden, Blumenthal, Warren and Eshoo Questions on Sale of .ORG

To see the full response letter,

“…Page 2 of 5even though, when the Internet Corporation for Assigned Names and Numbers(ICANN)awarded the operation of .ORG to the Internet Society in 2002, that agreement did not require that .ORG be operated by a non-profit entity or by a non-governmental organization. In fact, from 1993 to 2003, .ORG was operated by a for-profit company.”

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ETHOS CAPITAL  deserves the Poop in My Fingernails song

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