San Francisco—The Electronic Frontier Foundation (EFF) today said a private equity firm newly created by domain name industry insiders should be stopped from acquiring the .ORG domain registry, which provides a home on the Internet to thousands of public interest nonprofits organizations.



EFF joins groups ranging from the Girl Scouts and the League of Women Voters, to Farm Aid and Meals On Wheels, and other organizations working in the public interest around the world in the arts, culture, the environment, race, and poverty, in opposing the sale.



EFF this week called on the Internet Corporation for Assigned Names and Numbers (ICANN) to halt a transaction that puts nonprofit organizations at risk of censorship and financial exploitation. EFF also provided to ICANN a petition signed by over 500 nonprofit groups from around the world, plus thousands of Internet users, all voicing opposition to the $1.1 billion sale.



In a sneaky attempt to wrest control over the lucrative .ORG registry, Ethos Capital, a new private equity firm that lists two employees on its website and has no track record in public interest work, announced it would acquire Public Interest Registry (PIR). PIR is itself a nonprofit that, as a subsidiary of the nonprofit Internet Society, has for the past 17 years overseen the registry used by millions of organizations large and small.



“We are concerned that PIR may wield the threat of domain suspension to influence the political, social, religious, journalistic, or personal expression of .ORG registrants and their users at the request of corporations or governments,” EFF said in the letter. EFF’s letter joins one filed late last week by the Packet Clearing House, which actually services .ORG, pointing out the risk that the new owner will try to save money by degrading service.



The sale to Ethos Capital follows ICANN’s decision to remove price caps on registration fees for .ORG names, allowing PIR to raise prices at will on its captive customer base of nonprofits. And ICANN also gave PIR explicit permission to create new “protections for the rights of third parties”—often used as a justification and legal cover for censorship—without community input or accountability. Ethos Capital registered for business one day after ICANN was scheduled to announce it would be removing price caps, according to reports.



“The sale magnifies concerns that PIR has incentive to use its power to censor nonprofits whose work runs counter to the interests of powerful corporate or governmental interests,” said EFF Senior Staff Attorney Mitch Stoltz. “PIR is a subsidiary of the Internet Society, a nonprofit that oversees the Internet’s basic technical standards and has operated the .ORG registry to provide a home for nonprofits everywhere. With this transaction, the Internet Society is treating the registry like an asset, a building or a piece of land that can be sold, and operated as a private, for profit entity.”



Ethos Capital’s founder was previously a partner at another private equity firm that invested in domain registries and acquired registry operator Donuts. In 2016, Donuts entered a private agreement with the Motion Picture Association of America to suspend domains based on accusations of copyright infringement from major movie studios, with no court order or right of appeal. Little is known about Ethos’s plans and goals for PIR.



“Ethos is paying over $1 billion for PIR, which earned $101 million in income last year. You don’t invest that kind of money without plans to boost profits,” said EFF Staff Attorney Cara Gagliano. “Nonprofits will be squeezed for those profits, and Ethos may seek profitable arrangements with other businesses whose interests conflict with the nonprofit community or threaten to degrade the service. We need to stop this sale and find an acquirer whose interests are aligned with the nonprofit world so that won’t happen.”



For EFF’s letter:

https://www.eff.org/document/letter-icann-regarding-org-sale