[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]



                       DOT KIDS NAME ACT OF 2001

=======================================================================

                                HEARING

                               before the

          SUBCOMMITTEE ON TELECOMMUNICATIONS AND THE INTERNET

                                 of the

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS

                             FIRST SESSION

                                   on

                               H.R. 2417

                               __________

                            NOVEMBER 1, 2001

                               __________

                           Serial No. 107-63

                               __________

       Printed for the use of the Committee on Energy and Commerce


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 house

                               __________


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                    ------------------------------  

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                    COMMITTEE ON ENERGY AND COMMERCE

               W.J. ``BILLY'' TAUZIN, Louisiana, Chairman

MICHAEL BILIRAKIS, Florida           JOHN D. DINGELL, Michigan
JOE BARTON, Texas                    HENRY A. WAXMAN, California
FRED UPTON, Michigan                 EDWARD J. MARKEY, Massachusetts
CLIFF STEARNS, Florida               RALPH M. HALL, Texas
PAUL E. GILLMOR, Ohio                RICK BOUCHER, Virginia
JAMES C. GREENWOOD, Pennsylvania     EDOLPHUS TOWNS, New York
CHRISTOPHER COX, California          FRANK PALLONE, Jr., New Jersey
NATHAN DEAL, Georgia                 SHERROD BROWN, Ohio
STEVE LARGENT, Oklahoma              BART GORDON, Tennessee
RICHARD BURR, North Carolina         PETER DEUTSCH, Florida
ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
GREG GANSKE, Iowa                    ANNA G. ESHOO, California
CHARLIE NORWOOD, Georgia             BART STUPAK, Michigan
BARBARA CUBIN, Wyoming               ELIOT L. ENGEL, New York
JOHN SHIMKUS, Illinois               TOM SAWYER, Ohio
HEATHER WILSON, New Mexico           ALBERT R. WYNN, Maryland
JOHN B. SHADEGG, Arizona             GENE GREEN, Texas
CHARLES ``CHIP'' PICKERING,          KAREN McCARTHY, Missouri
Mississippi                          TED STRICKLAND, Ohio
VITO FOSSELLA, New York              DIANA DeGETTE, Colorado
ROY BLUNT, Missouri                  THOMAS M. BARRETT, Wisconsin
TOM DAVIS, Virginia                  BILL LUTHER, Minnesota
ED BRYANT, Tennessee                 LOIS CAPPS, California
ROBERT L. EHRLICH, Jr., Maryland     MICHAEL F. DOYLE, Pennsylvania
STEVE BUYER, Indiana                 CHRISTOPHER JOHN, Louisiana
GEORGE RADANOVICH, California        JANE HARMAN, California
CHARLES F. BASS, New Hampshire
JOSEPH R. PITTS, Pennsylvania
MARY BONO, California
GREG WALDEN, Oregon
LEE TERRY, Nebraska

                  David V. Marventano, Staff Director

                   James D. Barnette, General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

          Subcommittee on Telecommunications and the Internet

                     FRED UPTON, Michigan, Chairman

MICHAEL BILIRAKIS, Florida           EDWARD J. MARKEY, Massachusetts
JOE BARTON, Texas                    BART GORDON, Tennessee
CLIFF STEARNS, Florida               BOBBY L. RUSH, Illinois
  Vice Chairman                      ANNA G. ESHOO, California
PAUL E. GILLMOR, Ohio                ELIOT L. ENGEL, New York
CHRISTOPHER COX, California          GENE GREEN, Texas
NATHAN DEAL, Georgia                 KAREN McCARTHY, Missouri
STEVE LARGENT, Oklahoma              BILL LUTHER, Minnesota
BARBARA CUBIN, Wyoming               BART STUPAK, Michigan
JOHN SHIMKUS, Illinois               DIANA DeGETTE, Colorado
HEATHER WILSON, New Mexico           JANE HARMAN, California
CHARLES ``CHIP'' PICKERING,          RICK BOUCHER, Virginia
Mississippi                          SHERROD BROWN, Ohio
VITO FOSSELLA, New York              TOM SAWYER, Ohio
TOM DAVIS, Virginia                  JOHN D. DINGELL, Michigan,
ROY BLUNT, Missouri                    (Ex Officio)
ROBERT L. EHRLICH, Jr., Maryland
LEE TERRY, Nebraska
W.J. ``BILLY'' TAUZIN, Louisiana
  (Ex Officio)

                                  (ii)


                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Hernand, David, CEO, New.net.................................    12
    Howe, H. Page, President and CEO, .KIDS Domain, Inc..........    16
    Hughes, Donna Rice, former COPA Commissioner.................    26
    Taylor, Bruce A., President and Chief Counsel, National Law 
      Center for Children and Families...........................    21
    Victory, Hon. Nancy J., Administrator, National 
      Telecommunications and Information Administration..........     8

                                 (iii)

  

 
                       DOT KIDS NAME ACT OF 2001

                              ----------                              


                       THURSDAY, NOVEMBER 1, 2001

              House of Representatives,    
              Committee on Energy and Commerce,    
                     Subcommittee on Telecommunications    
                                          and the Internet,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10:15 a.m., in 
room 2123, Rayburn House Office Building, Hon. Fred Upton 
(chairman) presiding.
    Members present: Representatives Upton, Stearns, Cox, 
Largent, Shimkus, Terry, Markey, Green, Luther, and Sawyer.
    Staff present: Kelly Zerzan, majority counsel; Yong Choe, 
legislative clerk; Jon Tripp, deputy communications director; 
and Brendan Kelsay, minority professional staff.
    Mr. Upton. Good morning.
    As you all know, last night was Halloween, and as the 
parent of two young kids, I know the anxiety that all get when 
our kids leave the house to go out after dark to trick or 
treat. And while in your head you know your children are safe, 
the anxiety comes from not being able to control what your 
children will come into contact with when they are out of the 
house. And once they get home, you breathe a sigh of relief. 
They are back in an environment that in fact you can control.
    However, more and more parents have recognized that they 
are losing some control over what enters their home as their 
kids spend more and more time on the home computer surfing the 
Internet. And while the Internet is an excellent tool for kids 
to learn, there are all sorts of inappropriate material that 
with just one wrong click or typo comes right into your living 
room, den, bedroom, basement--wherever the computer is located. 
And while there is no substitute for proper parental 
supervision, responsible parents that I talk to want more tools 
to assist them in protecting their kids on the Internet. 
Filters are one solution, but I believe that we can and we must 
do more to help.
    That is why I strongly support the creation of a kid-
friendly space on the Internet, just like dot com, dot gov, dot 
org--a dot kids ought to be created and implemented, which 
would be a safe place devoted solely to material which is 
appropriate for kids, where parents could choose to send their 
kids. It would be like a safe playground with fences around it. 
There is really no difference in the concept than the 
children's section at the public library, which is the only 
part of the library where kids are allowed to check out books.
    Today, we are examining proposals to create a dot kids, 
specifically H.R. 2417, the Dot Kids Domain Act of 2001, an 
excellent bipartisan, common sense child protection measure 
sponsored by John Shimkus and Ranking Member Ed Markey and 
cosponsored by 10 other members of this subcommittee. I commend 
these gentlemen for their efforts to help parents and their 
kids. We will also be examining an amendment in the nature of a 
substitute to the legislation, and I believe that the proposals 
which we have before us today point us in the right direction.
    The original bill relies on ICANN to implement a dot kids. 
Many of us have urged ICANN to do this for a very long time, 
but frustratingly, to no avail. My view is that if we were to 
rely on ICANN to gets its act together to implement a dot kids, 
my young kids would be parents perhaps by the time that it got 
done, if at all. My daughter turned 14 this morning.
    But ICANN is another issue for another day in the not-too-
distant future, as I anticipate our committee will continue its 
bipartisan oversight of this body. Parents should not have to 
wait for ICANN. Time is of the essence. And as a result, today 
we are also examining an amendment in the nature of a 
substitute to H.R. 2417 which would get us out of any reliance 
on ICANN by implementing a dot kids in the dot U.S. space--dot 
kids-dot U.S.--accomplishing virtually the same mission as the 
original bill. By doing this in the dot U.S. space, I have much 
greater confidence that in fact it will get done.
    Moreover, we know that the NTIA just awarded a new contract 
this week for the management of the existing dot U.S. domain 
and that the contract alludes to the establishment of a dot 
kids within the dot U.S. domain. Today, we will learn more 
about the aspect of that dot U.S. contract, what it does, what 
it does not do.
    At this point, I want to extend a warm welcome to Assistant 
Secretary Nancy Victory in her first appearance before the 
subcommittee. We look forward to hearing from all of you today, 
as we continue to work with you on this issue and others. And I 
yield for an opening statement to my friend, Ranking Member Ed 
Markey.
    Mr. Markey. Thank you, Mr. Chairman. Thank you for having 
this hearing.
    Welcome, Secretary Victory, to your first hearing before 
our subcommittee.
    The proposed dot kids domain will be a cyberspace sanctuary 
for content that is suitable for kids 13 and under, and will be 
an area devoid of content that is harmful to such minors. The 
harmful-to-minors standard was the standard that many public 
interest groups proposed as an antidote to the 
Telecommunications Act debate, while the problematic 
constitutional nature of the provision in that law addressing 
Internet pornography.
    Now that harmful-to-minors standard is obviously subject to 
court challenge currently, and we will have to see how the 
court rules in the future. Yet I want to emphasize a number of 
points about the free speech issues that have been raised about 
the current proposal that distinguish it from that debate. 
First, the proposed legislation that Mr. Shimkus has 
constructed will not subject all of the Internet communications 
to a harmful-to-minors standard. If you are in Tennessee or 
Timbuktu, you can publish or speak any content you want on the 
Internet. This proposal does not affect your ability to do so. 
This proposal now only addresses a subset of Internet commerce, 
the dot U.S. space.
    Moreover, it doesn't even curtail speech throughout the 
entirety of the dot U.S. country code domain. If you are in 
Providence, Rhode Island or Provo, Utah, under this bill you 
are free to exercise your constitutional rights, and this bill 
contains no proposal that would subject everyone utilizing the 
dot U.S. space to a standard suitable to kids. The bill solely 
stipulates that if you want to operate in the dot kids area of 
the dot U.S. country code domain, we want that area a green-
light district, if you will, to be an area of healthy content 
for children.
    And finally, let me note that there is no requirement that 
anyone utilize that space. Signing up for a dot kids domain and 
parents sending their kids to web sites in that location 
remains completely voluntary, and the free choice of both 
speakers and parents.
    Another issue that has been raised is whether this sets a 
precedent for other countries, and whether the creation of a 
dot kids domain under our country code here in the United 
States will induce other countries to choose routes that 
undermine free expression. Let me say that free expression is 
very important and that we want to safeguard important civil 
liberties of expression here and around the globe. Since this 
proposal does not stifle speech on any global top-level domain 
or even throughout the country code top-level domains, it 
preserves free expression.
    If another country, on the other hand, chose to restrict 
certain speech within its own country code domain space, that 
in itself would not prevent citizens there from speaking on a 
global top-level domain such as dot com or dot org. What is 
problematic is not a restriction within a country code, because 
such a restriction leaves ample room throughout the rest of the 
Internet for speech. But rather, laws in other countries that 
may muzzle speakers across the entirety of the Internet, in 
other words on a country code, but also on dot com and 
everywhere else.
    Again, this proposal simply creates an area where healthy 
speech for children can exist, and inappropriate speech is free 
to exist anywhere else.
    Finally, there are a number of issues regarding 
implementation of this idea that we must continue to work 
through. We must look at those who have already started to 
create this process in the marketplace, and names that have 
already been registered. In addition, there are a number of 
serious lingering concerns with the dot U.S. process at NTIA 
that affect taxpayers, competition and the public interest that 
we must also explore when looking at what NTIA has proposed for 
commercialization of the dot U.S. space.
    I want to thank you, Mr. Chairman, for holding this hearing 
and I want to congratulate Congressman Shimkus for his 
excellent work on this bill.
    Mr. Upton. Well, like a great outfield catch in left field, 
and the first batter up happens to be that left-fielder/catcher 
John Shimkus, author of the bill, is recognized for an opening 
statement.
    Mr. Shimkus. Thank you, Mr. Chairman.
    I want to first apologize for being late. I pride myself on 
being punctual. I chair the House Page Board and I had some 
meetings this morning with the Clerk of the House. So it just 
conflicted and I could not get back here in time. So I do 
apologize, and also to those panelists who are here.
    And I want to thank you, Chairman Upton, for holding this 
hearing today, and I want to really thank my colleague and 
friend from Massachusetts, Mr. Markey, on his partnership and 
leadership and help in crafting legislation that we think has a 
good chance of moving expeditiously through here, and hopefully 
if we produce a good work product, we can get it on the Senate 
desk and maybe we will--I will use your influence, Mr. Markey--
get it pulled off the desk or something and we can get moving.
    I also want to thank you for the use of your staffer Colin 
for his help, and my legislative assistant, Courtney Anderson. 
They have been working very, very closely together, along with 
Energy and Commerce Committee staffers Mike O'Reilly, Kelly 
Zerzan--all these famous people--and Will Nordwind for their 
invaluable assistance in working through this.
    And I want to thank you for being here and testifying on 
this and giving your input on how we can move forward. We think 
it is very, very important. Originally, H.R. 2417 would have 
directed ICANN to create a new dot kids top-level domain. And 
we have heard that there has been reticence and problems with 
that proposal. So we have acceded to some of those concerns and 
agreed to move to the dot U.S. country code domain. I think 
that solves a huge roadblock and will be very, very helpful in 
moving forward.
    Aside from the change in the Internet address, the bill 
remains largely the same after that. It requires the Department 
of Commerce and NTIA to work with the dot U.S. administrator to 
develop a plan to create a new kid-friendly domain within the 
dot U.S. country code, using the green light approach where all 
material will be appropriate for children. And my colleague, 
Mr. Markey, said it very plainly and succinctly. I was at a 
library on Monday. All we are trying to do is get a wing of a 
library open for kids to check out books, and that is the 
intent here.
    It establishes the structure for a new domain, including an 
independent board selection process, continuous monitoring for 
inappropriate content, and consultation requirements. It 
requires the Department of Commerce and NTIA to publicize dot 
kids to parents, and to work with the Department of Justice to 
prevent children from being targeted on the new domain.
    As many of you know, this has been an issue that I have 
been concerned with, as many of my colleagues, for a long time. 
The World Wide Web holds a vast treasure of knowledge, but 
within this web is a great deal of material that is harmful or 
simply not suitable for children to view. And we have it here. 
I have been on this committee now 5 years. Every year we will 
have Internet gambling and how it creates addiction; Internet 
pornography; problems with chat rooms. You name it, we have 
heard it. And this is an attempt to at least protect our 
children from that. As youngsters try to navigate their way 
through the complex jungles of dot com or dot org, they are at 
the mercy of whatever pops up on the screen.
    Study after study on children and the Internet are 
concluding that inappropriate material and targeting by 
predators are the new perils that all of our children face 
online. We cannot control behavior or content on a borderless 
Internet. However, we can create a special place for our 
country's children on our own country's web domain as a 
workable alternative. As a representative in Congress and a 
father of three young boys, I think it is time we get this 
valuable tool for parents implemented. And again, we have heard 
about this for 5 years and it is time to start moving on 
something.
    One thing I want to make clear about H.R. 2417 is that it 
is not a silver bullet. As I have said, and has been said to 
me, that the creation of a dot kids domain would not prevent 
curious youngsters from venturing onto web sites or chat rooms 
where they could expose themselves to harmful material or 
dangerous predators. My bill is in no way designed to replace 
the important role of parental supervision on the Internet. And 
a lot of my friends have actually moved their computer to 
centralized locations in the house. My kids will not have an 
Internet in their room. They are not going to have a TV in 
their room, especially with cable these days.
    My bill is in no way designed to replace the important role 
of parents. Dot kids will be an area, a safe site for children, 
but nothing can replace parental vigilance when it comes to 
safe surfing. Dot kids will not only serve to help protect 
children from unsuitable material, but just like a children's 
store or a children's section in the library, I believe a 
child-friendly domain will promote positive education and 
entertainment web sites by serving as a forum for children's 
material. And I think it is going to be well-received.
    Finally, I would like to add that this bill sends an 
important message. It says that we as a country care about the 
character development of our children, and we are going to do 
everything we can to protect them on this information medium. I 
hope my colleagues will join me in support of this legislation.
    Thank you again, Chairman Upton, for bringing this 
important issue before the committee today. I thank you for 
your advice and consultations on your proposed manager's 
amendment which hopefully we will also discuss today, and I 
look forward to hearing the testimony of the panel. And again, 
I apologize for being late, and I yield back my time.
    Mr. Upton. Thank you.
    The gentleman from Texas, Mr. Green.
    Mr. Green. Thank you, Mr. Chairman. I just have an opening 
statement. I want to commend both Mr. Shimkus and Mr. Markey 
for developing this excellent idea. Creating a safe haven for 
children's Internet content not only represents a reasonable 
approach to protecting our kids, but also protecting the First 
Amendment.
    Having ICANN grant a dot kids top level domain would afford 
Internet service providers greater ability to create safe 
havens for children on the Internet. I do, however, have some 
concerns with not keeping dot kids as a top level domain. 
Creating it a second-level domain would, I believe, be 
cumbersome for children to navigate, and thus would fail its 
primary purpose to provide children with easy access to safe 
content.
    Mr. Chairman, more invasive steps have been attempted in 
the past with trying to regulate content or describe material 
that is harmful to children. I think this legislation is truly 
a step in the right direction. I am glad we are having a 
legislative hearing on it, and hopefully we will see it at a 
markup soon, and I congratulate the two sponsors, and thank 
you, Mr. Chairman.
    Mr. Upton. Thank you.
    The gentleman from California, Mr. Cox.
    Mr. Cox. Thank you, Mr. Chairman.
    This is an issue that I have been interested in and 
concerned with for several years. We have had other hearings in 
this committee on this topic. Some of them on the flip of this 
issue, which is the creation of a domain that would cabin away 
pornography and so on in one spot so that it would be easy for 
people not run into it by accident on the Internet. This is a 
more modest venture that will create perhaps one area, one 
space on the Internet where it will be safe for children.
    It is certainly important that we commend the initiative 
shown by our members on both sides, Mr. Shimkus and Mr. Markey, 
and it is also important for us to recognize that apart from 
the genius of the essential idea, there are a lot of nettlesome 
difficulties that need to be overcome in order to make such an 
idea work. And that is why it is coming to a hearing, and I am 
pleased, Mr. Chairman, that you have done so.
    Mr. Upton. Thank you.
    At this point, I would like to make unanimous consent 
requests that all members of the subcommittee be afforded the 
opportunity to enter into the record an opening statement. I 
know we have a number of subcommittee meetings that are meeting 
this morning. The House is also in session. We expect some 
votes in about an hour as well.
    [Additional statements submitted for the record follow:]
 Prepared Statement of Hon. W.J. ``Billy'' Tauzin, Chairman, Committee 
                         on Energy and Commerce
    First, let me thank Chairman Upton for holding today's hearing, 
which considers a subject central to parents' efforts to ensure their 
children can experience the best of the Internet, while minimizing its 
downside.
    It's a rule of life that with the good comes some bad. The Internet 
is no different. Although there are enormous benefits that flow from 
the Internet, parents and children's advocates have long complained 
that it offers a wide window to material that is inappropriate, even 
harmful, for children.
    The tech industry and government have tried to respond to parents' 
concerns: software companies have offered filters to help sift through 
content, and this Committee has reported and Congress has passed a 
number of measures intended to help parents protect their children. But 
success on this front has been limited.
    Today, we have before us two legislative options that seek to go 
beyond existing efforts and create a ``safe space'' on the Internet for 
children. H.R. 2417--the Dot Kids Domain Name Act of 2001, introduced 
by Mr. Shimkus and Ranking Member Mr. Markey--and an amendment in the 
nature of a substitute both seek to build a ``green light'' domain, the 
equivalent of a children's playground or children's library on the 
Internet. H.R. 2417 would create a generic, top level domain--a 
``.kids''--while the amendment would create a secondary domain within 
the .us country code--a ``kids.us.''
    Regardless of the location, the use of a child-friendly domain 
would be completely voluntary: parents could chose to use it, and 
website operators could opt to be located within it. However, the 
domain would be filled only with material that is appropriate for 
children.
    While there are real benefits to making a safe space for children 
through a global, generic top-level domain, this cannot be achieved 
without the cooperation of ICANN. Unfortunately, even if H.R. 2417 was 
signed into law, based on the memorandum of understanding between the 
Department of Commerce and ICANN, there is no assurance that ICANN 
would ever implement a ``.kids'' domain. Moreover, for years now this 
Committee has questioned the operations at ICANN, its methods of 
choosing new domains, and the organization's lack of transparency.
    For these reasons, the substitute amendment may be a quicker route 
to the goal of protecting the Internet experiences of children and 
families. The ``.us'' space provides us with a guarantee that a safe 
space for children will be created. Parents want it, kids need it, and 
we will make sure it happens.
    I want to commend the sponsors of this legislation, Mr. Shimkus, 
for his unswerving dedication to protecting children using the 
Internet, and Mr. Markey, who has been an invaluable ally, arguing not 
only for a safe space for children, but for ICANN reform. I know that 
many Members have pushed for additional oversight of ICANN and the 
Commerce Department's authority over ICANN. And I look forward, as 
well, to this Subcommittee's continued good work doing just this in the 
upcoming session.
    Thank you, again, Chairman Upton for calling this important hearing 
and I look forward to hearing from our witnesses.
                                 ______
                                 
 Prepared Statement of Hon. Eliot Engel, a Representative in Congress 
                       from the State of New York
    Mr. Chairman: First I want to thank our colleague, Mr. Shimkus, for 
his continued work on behalf of children. We may not always agree on 
certain things, but I have no doubt that when it comes to protecting 
children, he does so with the best of intentions.
    To be honest at first glance, this seems like a simple, good idea. 
But as with so many things, the devil is in the details.
    Having reviewed HR 2417, I must admit I like the general idea, but 
have some concerns about the specifics. Most importantly, I am not sure 
that any act of Congress could force ICANN to create a Top-Level 
Domain. The United States has entered into an international agreement 
to manage the Internet and so I think we must be sensitive to that, or 
face some anger from our partners in developing the Internet around the 
globe.
    Therefore, I was pleased to see the draft substitute that would 
create a dot-kids under the dot-us Top Level Domain. I think Congress' 
influence and authority is much clearer here and I think in the end it 
makes more sense to do create dot-kids this way.
    I also appreciate that in the substitute the definition of minor 
has been changed from 17 to 13 years old. I am an ardent defender of 
the First Amendment, but do recognize that there are things I don't 
want my 8 year old son Philip seeing on the Internet. I think it would 
be great for him to get math and social studies help, but I certainly 
don't think he needs to be visiting sites that are sexually explicit.
    The problem is what to do about older ``minors'' in the traditional 
legal sense. I think many 15 year old children have legitimate 
questions about sex and sexuality that they just won't feel comfortable 
talking to their parents about. I do believe they should have access to 
such information. Lowering the age will help.
    And of course there are the 11, 12, and 13 year old children who 
will have their own questions about how their bodies are changing and 
why. The Internet has been very successful at allowing people to find 
others in a similar situation--from cancer patient support groups to 
bird watchers--and I believe the Internet can be useful to many 
children who are experiencing some many new feelings and emotions. They 
can find there are thousands of other children just like them.
    Finally, I am sure that in the future we will be having new 
arguments about whether or not we should have anything on dot-kids that 
discusses homosexuality. The fact is that there are many children today 
being raised by gay and lesbian parents. And, most children start going 
through puberty at 11, 12, or 13. The sad fact is that the suicide rate 
among gay male teens is significantly higher than the norm and may be 
three times as high. The Internet, I believe and hope, can be a safe 
place for these teens to find support and a medium to help prevent 
suicide.
    I commend my colleague for trying to create a safe harbor for 
children. I am hopeful that with some further thought and 
investigation, we will be able to create such a place.

    Mr. Upton. So with that being done, I want to welcome our 
panel this morning. We will start with the Honorable Nancy 
Victory, who is the Administrator and Assistant Secretary for 
the National Telecommunications and Information Administration, 
NTIA; Mr. David Hernand, CEO of New.net; Mr. Page Howe, 
President of DOT KIDS Domains, Inc,; Mr. Bruce Taylor, 
President and Chief Counsel of the National Law Center for 
Children and Families; and Ms. Donna Hughes, Internet safety 
expert, adviser and spokesperson for Family Click.com, and also 
an author, and we thank you for the complimentary copy, I 
presume, but if not, the copy, paperback of your book.
    Thank you.
    We will start. We would like to thank you in advance for 
submitting your testimony, and we would like you to proceed 
with the opening statements, and if you would not mind trying 
to stay close to the 5-minute rule, we will start the clock 
and, Ms. Victory, we will start with you. Thank you. Welcome.

 STATEMENTS OF HON. NANCY J. VICTORY, ADMINISTRATOR, NATIONAL 
   TELECOMMUNICATIONS AND INFORMATION ADMINISTRATION; DAVID 
 HERNAND, CEO, NEW.NET; H. PAGE HOWE, PRESIDENT AND CEO, .KIDS 
  DOMAIN, INC.; BRUCE A. TAYLOR, PRESIDENT AND CHIEF COUNSEL, 
 NATIONAL LAW CENTER FOR CHILDREN AND FAMILIES; AND DONNA RICE 
                HUGHES, FORMER COPA COMMISSIONER

    Ms. Victory. Chairman Upton, I would like to thank you and 
the members of the subcommittee for inviting me here to testify 
today. Developing a safe space on the Internet for children is 
certainly a worthwhile undertaking, and I appreciate this 
opportunity to work with you to realize this goal.
    I believe that the Internet should be a tool of electronic 
commerce, education, entertainment and communications for all 
Americans. During my tenure at NTIA, I intend to further 
policies that produce opportunities for all Americans to take 
greater part in the digital age. At the same time, I want to 
ensure that the Internet provides positive, safe online 
experiences for our children. The administration continues to 
support ongoing private sector efforts to address many of the 
concerns raised by our children's increasing access to the 
Internet. There have been many thoughtful and innovative 
approaches taken by industry, nonprofit organizations and 
public institutions to provide ready access to child-friendly, 
quality content on the Internet, and to develop technological 
tools that help parents and guardians protect children from 
material they consider inappropriate.
    As you know, there are a number of excellent web sites 
specifically designed for children. Industry has also developed 
any number of innovative technology tools, including filtering 
software and browser applications. For example, in recent 
weeks, the Internet Content Rating Association and EarthLink 
both announced efforts to empower parents to manage their 
children's online experiences. The administration continues to 
believe that industry working with concerned parents and family 
organizations can make great strides in improving the quality 
of a child's experience on the Internet.
    I wanted to report on one action that the Department of 
Commerce announced this week that I believe has particular 
relevance to the subject matter today. Last Friday, the 
department awarded a contract to NeuStar, Inc. for the 
management of the existing dot U.S. domain. One of the 
interesting aspects of the NeuStar proposal is to create public 
resource domains under dot U.S. to serve as common spaces to 
further various public interest and service objectives. 
Pertinent to today's hearing is that NeuStar specifically 
proposes for one such public resource domain a dot kids/dot 
U.S. space as a safe space on the Internet specifically 
tailored to the needs of children. The Department of Commerce 
is looking forward to working with NeuStar to explore 
implementation of their proposal.
    The subcommittee has asked for my comments on H.R. 2417, 
the Dot Kids Domain Name Act of 2001, and the manager's 
amendment. While the NeuStar proposal may obviate the need for 
such legislation, I very much appreciate the opportunity to 
share my thoughts.
    While I support the goal of the legislation, the mechanisms 
contemplated in both versions raise substantial policy and 
legal concerns. The bill as introduced seeks to mandate the 
creation of a top-level dot kids domain by requiring the 
Internet Corporation for Assigned Names and Numbers, ICANN, to 
select a dot kids domain operator. Such regulation of the 
management of the Internet domain name system is inconsistent 
with the established policy goal of privatization of that 
system, and particularly private sector leadership with respect 
to the introduction of new top level domains.
    Among other things, unilateral action by the United States 
to create an international dot kids domain is at odds with the 
global nature of the Internet and the domain name system. 
International reaction to U.S. efforts to legislate in the area 
of domain name management could hamper the United States' 
abilities to advance its foreign policy objectives, 
particularly critical information and technology policy goals. 
Our international allies have a strongly held aversion to 
United States efforts to assert its national will on the 
Internet, a global resource. In fact, some governments have 
already raised objections to the instant legislation and have 
suggested that this kind of U.S. action supports their position 
that Internet-related decisionmaking should more properly be 
decided through international governmental organizations.
    I am also concerned about the mechanisms that the bill uses 
to mandate the creation of such a domain. The bill uses the 
memorandum of understanding between the Department of Commerce 
and ICANN to regulate ICANN's activities with respect to the 
new top-level domain. All activities under the memorandum of 
understanding, however, are by mutual agreement. The Department 
of Commerce does not regulate ICANN. The memorandum of 
understanding very clearly leaves the selection and 
introduction of top-level domains to the private sector-led 
process within ICANN. I continue to believe that the private 
sector is best able to make decisions about new top-level 
domains that affect the global Internet.
    The bill would also prohibit ICANN from considering, or the 
department from approving, any new top-level domain or country 
code top-level domain until a dot kids domain is established. I 
am very concerned about the potentially anti-competitive impact 
of this provision on U.S. stakeholders, including information 
technology companies seeking to enter the domain name market.
    The bill also establishes a content standard for the dot 
kids domain and requires ICANN and the department to regulate 
online content based on this standard. As Congressman Markey 
has recognized, some courts have in the past found such 
government-mandated standards to be problematic and this issue 
on this particular standard is currently pending before the 
Supreme Court in the COPA case.
    I am also concerned about the appropriateness of the 
Department of Commerce regulating online content. 
Traditionally, law enforcement agencies enforce the various 
prohibitions against illegal content.
    I am pleased to say that some of the difficulties inherent 
in H.R. 2417 as introduced are eliminated in the manager's 
amendment. However, the manager's amendment, by requiring the 
creation of a second-level dot kids domain, seeks to do so 
under the dot U.S. top-level domain. While I believe focusing 
on dot U.S. is more likely to yield the successful realization 
of a kid-friendly space designed specially for American 
children, the manager's amendment still raises some policy and 
legal concerns.
    Particularly, I note that the amendment continues to 
require content standards and enforcement by the Department of 
Commerce. It also alters the existing contractual obligations 
between the Department of Commerce and NeuStar that were 
established through the government procurement process, and it 
changes the company's expectations with respect to its 
opportunities under the award. As such, if passed, the 
amendment could raise questions about the validity of the 
recent procurement.
    While the department supports the development of a dot 
kids-dot U.S. domain, I am concerned that the problems with 
this legislation could ultimately undermine this goal. I 
believe the development of a viable voluntary space in the dot 
U.S. domain for children's content can better and more quickly 
be achieved by focusing on implementation of the proposal put 
forth by NeuStar and the dot U.S. award. I would like to 
continue to work with the bill's sponsors to develop an 
approach that would ensure that the proposal is implemented in 
a timely and beneficial manner.
    Again, thank you for this opportunity to testify. I would 
be happy to answer any questions you might have.
    [The prepared statement of Hon. Nancy J. Victory follows:]
  Prepared Statement of Hon. Nancy J. Victory, Assistant Secretary of 
            Commerce for Telecommunications and Information
    Chairman Upton, I would like to thank you and the members of the 
Subcommittee for inviting me here to testify today. Developing safe 
spaces on the Internet for children is certainly a worthwhile 
undertaking and I appreciate this opportunity to work with you to 
realize this goal.
    I believe that the Internet should be a tool of electronic 
commerce, education, entertainment, and communications for all 
Americans. During my tenure at the National Telecommunications and 
Information Administration (NTIA), I intend to further policies that 
produce opportunities for all Americans to take greater part in the 
digital age. At the same time, I want to ensure that the Internet 
provides positive, safe online experiences for our children.
    The Administration continues to support ongoing private sector 
efforts to address many of the concerns raised by our children's 
increasing access to the Internet. There have been many thoughtful and 
innovative approaches taken by industry, non-profit organizations, and 
public institutions to provide ready access to child-friendly, quality 
content on the Internet and to develop technological tools that help 
parents and guardians protect children from material they consider 
inappropriate. I commend them for these laudable efforts.
    As you know, there are a number of excellent web sites specifically 
designed for children. Industry has also developed any number of 
innovative technology tools, including filtering software and browser 
applications. Recently, the Internet Content Rating Association, a 
global non-profit organization backed by industry leaders such as AOL, 
the Microsoft Network and Yahoo!, announced that it has developed a new 
voluntary rating system that allows content providers to label web site 
content. And, just this week, EarthLink announced that it had teamed 
with SurfMonkey to offer a free, downloadable browser and new 
children's services designed to offer children a safer online 
experience. In addition, EarthLink will offer a $2.95 per month premium 
service that provides advanced parental controls on e-mail, instant 
messaging, videophone, bulletin boards and chatrooms and that includes 
a technology that enables children to communicate only with friends 
whom their parents have approved.
    These efforts promise to empower parents to manage their children's 
online experiences consistent with their individual values. The 
Administration continues to believe that industry working with 
concerned parents and family organizations can make great strides in 
improving the quality of a child's experience on the Internet.
    I am particularly pleased to report on two actions that the 
Department of Commerce announced this week that I believe will enhance 
opportunities for Americans, including children, on the Internet. 
First, the Department entered into a cooperative agreement with 
EDUCAUSE, a nonprofit organization representing the information 
technology needs of the U.S. higher education community, to better 
manage and expand the existing .edu domain. The .edu domain is one of 
the original seven top level domains created by the founders of the 
Internet for use by four-year colleges and universities in the United 
States for computer research purposes. This legacy domain has since 
been used by U.S. institutions of higher learning to provide college 
registration services, distance learning programs, curricula 
distribution, and a myriad of other educational purposes. The 
cooperative agreement with EDUCAUSE recognizes the importance of 
involving the higher education community in the policymaking related to 
.edu to ensure that it better serves education in America. I am also 
pleased to announce that, as one of its first actions, EDUCAUSE will be 
making the .edu domain available to approximately1,200 regionally 
accredited community colleges across the United States.
    I am also pleased to report that the Department awarded a contract 
to NeuStar, Inc., for management of the existing .us domain. The .us 
domain is the country code top level domain created by Internet 
founders to be associated with the United States. It is currently used 
primarily by state and local governments, schools, libraries and other 
public institutions. Because of its cumbersome locality-based naming 
structure, the .us domain has been largely unused by American 
businesses and consumers.
    However, we are hoping the NeuStar contract will change that by 
providing enhanced opportunities for all Americans--small businesses, 
industry, individuals, state and local governments, and schools and 
libraries--to have a presence on the Internet uniquely associated with 
the United States. NeuStar has committed to making substantial 
investments in the technical management of .us as well as developing a 
means for U.S. stakeholders to participate in policymaking. One of the 
interesting aspects of its proposal is to create ``public resource'' 
domains under .us to serve as common spaces to further various public 
interest and service objectives. Pertinent to today's hearing is that 
NeuStar specifically proposes for one such public resource domain a 
``.kids.us'' space as a ``safe'' space on the Internet specifically 
tailored to the needs of children.
    We at the Department of Commerce are looking forward to working 
with NeuStar to explore implementation of this aspect of their proposal 
in a manner consistent with our goal of empowering parents and 
respecting our nation's fundamental commitment to free expression. We 
will work with the Subcommittee as we move forward in this 
implementation to ensure that our mutual goals are achieved.
    The Subcommittee has asked for my comments on H.R. 2417, the ``Dot 
Kids Domain Name Act of 2001,'' and the manager's amendment. While the 
NeuStar proposal may obviate the need for such legislation, I 
appreciate the opportunity to share my thoughts. While I support the 
goal of the legislation, the mechanisms contemplated in both versions 
raise substantial policy and legal concerns.
    The bill as introduced seeks to mandate the creation of a top level 
``.kids' domain by requiring the Internet Corporation for Assigned 
Names and Numbers (ICANN) to select a .kids domain operator. Such 
regulation of the management of the Internet domain name system is 
inconsistent with the established policy goal of privatization of that 
system, and particularly, private sector leadership with respect to the 
introduction of new top level domains.
    Among other things, unilateral action by the United States to 
create an ``international'' .kids domain is at odds with the global 
nature of the Internet and its domain name system. International 
reaction to U.S. efforts to legislate in the area of domain name 
management could hamper the United States' abilities to advance its 
foreign policy objectives, particularly critical telecommunications and 
information policy goals. Our international allies have a strongly held 
aversion to United States' efforts to assert its national will on the 
Internet, a global resource. In fact, some governments have already 
raised objections to the instant legislation and have suggested that 
this kind of U.S. action supports their position that Internet-related 
decisionmaking should more properly be decided through international 
governmental organizations.
    I am also concerned about the mechanisms that the bill uses to 
mandate the creation of such a domain. The bill uses the memorandum of 
understanding between the Department of Commerce and ICANN to regulate 
its activities with respect to new top level domains. All activities 
under the memorandum of understanding, however, are by mutual 
agreement. The Department of Commerce does not ``regulate'' ICANN. The 
memorandum of understanding very clearly leaves the selection and 
introduction of new top level domains to the private sector-led process 
within ICANN. I continue to believe that the private sector is best 
able to make decisions about new top level domains that affect the 
global Internet.
    The bill would also prohibit ICANN from considering, or the 
Department from approving, any new top level domain or country code top 
level domain until a .kids domain is established. I am very concerned 
about the potentially anti-competitive impact of this provision on U.S. 
stakeholders, including information technology companies, seeking to 
enter the domain name market. As Secretary of Commerce Evans wrote to 
Dr. Vinton Cerf, ICANN's Chairman, in May of this year, the Department 
supports ICANN's ongoing activities to select new top level domains. In 
particular, Secretary Evans noted the importance of competition in the 
top level domain market.
    The bill also establishes a content standard for the .kids domain 
and requires ICANN and the Department to regulate online content based 
on this standard. Some courts have in the past found such government 
mandated standards to be problematic, and I understand this issue is 
currently pending before the Supreme Court in the COPA case. I am also 
concerned about the appropriateness of the Department of Commerce 
regulating online content. Traditionally, law enforcement agencies 
enforce the various prohibitions against illegal content (e.g., 
gambling, pornography, fraud).
    I am pleased to say that some of the difficulties inherent in H.R. 
2417 as introduced are eliminated in the manager's amendment by 
focusing instead on a domestic approach. The manager's amendment 
requires the creation of a second level ``.kids'' domain under the .us 
top level domain. While I believe focusing on .us is more likely to 
yield a successful realization of a ``kid-friendly'' space designed for 
American children, the manager's amendment still raises some policy and 
legal concerns. Particularly, I note that the amendment continues to 
require content standards and enforcement by the Department of 
Commerce. It also alters the existing contractual obligations between 
the Department of Commerce and NeuStar that were established through 
the government procurement process and it changes the company's 
expectations with respect to its opportunities under the award.
    While the Department supports the development of a .kids.us domain, 
I am concerned that problems with this legislation could ultimately 
undermine that goal. I believe that development of a viable, voluntary 
space in the .us domain for children's content can better be achieved 
by focusing on implementation of the proposal put forth by NeuStar in 
the .us award. I would like to continue to work with the bill's 
sponsors to develop an approach that would ensure that the proposal is 
implemented in a timely and beneficial way. NTIA expects part of this 
effort to include working with our contractor to conduct outreach to 
interested family organizations and public interest groups and to 
consult with relevant government agencies, including the Departments of 
Education, Health and Human Services, and Justice. I look forward to 
reporting back to the Committee soon on the progress we have achieved.
    Again, thank you for this opportunity to testify. I will be happy 
to answer any questions you may have.

    Mr. Upton. Thank you.
    Mr. Hernand?

                   STATEMENT OF DAVID HERNAND

    Mr. Hernand. Good morning, Mr. Chairman and members of the 
subcommittee. I am David Hernand, CEO of New.net, a market-
based domain name registry business headquartered in Sherman 
Oaks and launched in March of this year.
    New.net is a leading innovator in expanding the 
availability of domain names, with more descriptive and useful 
extensions that make it easier for users to navigate the 
Internet. We offer domain names with descriptive extensions 
such as dot shop, dot family, dot club and dot kids, among many 
others. These are extensions that supplement the more 
traditional top-level domains like dot com and dot net and 
others that are supported on the root servers administered by 
the Department of Commerce.
    Unlike dot com names, however, Internet users access our 
names either by using one of our partner ISPs that have made a 
small change on their networks to recognize these names, or by 
using a small software application that enables individual 
users to see the names. Today, more than 71 Internet users have 
access to these names and we are growing that number by 
millions each month. With the support of five of the top seven 
ISPs in the U.S., more than 40 percent of U.S. Internet 
households already can use New.net domain names.
    New.net is helping to satisfy the growing public demand for 
shorter, more descriptive domain names that have been left 
unmet by the increasing scarcity of names under dot com and dot 
net. This scarcity has been caused by the failure of existing 
structures to expand and improve how users access the Internet. 
Our market-based approach exists to answer this need and to 
increase the availability of better domain names generally.
    We released the dot kids extension in March of this year 
when we launched, in partnership with .KIDS Domains, Inc., a 
San Diego-based company. We were impressed with .KIDS Domains' 
comprehensive policies for creating a kid-friendly environment 
on the Internet. And since our launch, we have seen the 
development of a community of dot kids web sites which we 
expect will grow dramatically as public awareness of the dot 
kids extension increases.
    .KIDS Domains previously applied to ICANN for a dot kids 
extension, but its request was rejected. We see this rejection 
as a failing of the ICANN process to serve the interest of 
Internet users. New.net went ahead with enabling dot kids 
domains to make the dot kids extension available without harm 
to the integrity of the Internet infrastructure of the ICANN 
process. Given our positive dot kids experience, we agree with 
Congressmen Shimkus and Markey that establishment of a dot kids 
top-level domain would be extremely useful to consumers, and 
commend them for introducing H.R. 2417. This legislation 
highlights our concern that current ICANN procedures for 
selecting new top-level domains are far too slow and encumbered 
by vested interests that oppose expanding the supply of better 
domain names.
    New.net already has plowed ahead with a real live dot kids 
extension, but we support any effort, government or otherwise, 
to make that resource available to Internet users everywhere. 
While we would prefer changes in the ICANN system to accelerate 
the selection of user-friendly TLDs such as dot kids, other 
methods may help to accelerate the availability in the short 
term. One option is to create a second-level domain for dot 
kids within the dot U.S. country code TLD, provided that this 
is done in a way that complies with pro-competition and pro-
consumer requirements. Absent these provisions, the expansion 
of the dot U.S. extension could result in unfair competition, 
artificial limitations on second-level domains, and unjust 
enrichment of some commercial entities over others. The origins 
of the dot U.S. domain as a public asset demand that its 
expansion accrue to the benefit of the general public, 
according to fair and competitive principles.
    We have two recommendations if dot kids is established as a 
second-level domain within dot U.S. First, the NTIA should 
select a registry operator to manage it through a competitive 
application process. An explicit factor in that registry 
selection should be the demonstration of experience in 
operating services designed to protect children on the 
Internet. And second, existing domain name holders under dot 
kids should be able to take advantage of a sunrise period in 
which they have the first right to be registered under dot 
kids-dot U.S. For example, the entity that has registered and 
is operating Tutor.kids should have the first right to register 
as Tutor.kids.US. Otherwise, the establishment of a dot kids 
second-level domain would be unfair to existing customers of 
dot kids, equivalent to nationalizing a private American 
company that took the risk of introducing a good idea to the 
market, investing in it, and developing it.
    Mr. Chairman, New.net supports legislative efforts to 
create a dot kids domain as a TLD or a second-level domain 
within dot US., because introducing such domain names will 
benefit consumers. New.net and kids domains have demonstrated 
these benefits with our market-based approach, proving that it 
can be done today. We welcome the help of our government 
leaders to make the dot kids domains available to Internet 
users everywhere.
    Thank you.
    [The prepared statement of David Hernand follows:]
     Prepared Statement of David Hernand on Behalf of New.net, Inc.
    Mr. Chairman and Members of the Subcommittee, my name is David 
Hernand. I am Chief Executive Officer of New.net, Inc., a market-driven 
domain name registry business headquartered in Sherman Oaks, 
California, and started in May 2000 by idealab!, the Internet 
incubator. New.net is building the Internet's leading market-driven 
domain name registry business by selling domain names with logical, 
easy-to-remember extensions to make the Internet easier to navigate for 
consumers and businesses alike. Our extensions include such user-
friendly names as .shop, .family, .church, .club, .auction, and .movie. 
New.net believes that by allowing web addresses to end in more 
descriptive words, websites will be better able to communicate what 
they are offering, and consumers will be able to find things more 
easily. New.net is helping to satisfy the growing public demand for 
shorter, more descriptive domain names that has been left unmet by the 
increasing scarcity of names ending in .com and .net.
    Currently, consumers can access New.net domain names in one of two 
ways-either through one of the Internet service providers (ISPs) around 
the world that provide access to New.net domain names through a simple 
network upgrade, or through a software application that New.net makes 
available directly to users from its website. Both of these methods 
work transparently for users within the existing Internet 
infrastructure and currently enable more than 71 million Internet users 
worldwide to view New.net's domain names.
    The ``.kids'' extension is one of the first names we successfully 
released in the market. Since March 2001, New.net has operated the 
.kids' extension in partnership with .KIDS Domains, Inc. New.net has 
been the technical facilitator of the. kids extension, ensuring that it 
can be accessed by millions of parents and children in the U.S. At 
present, 44% of U.S. households can access .kids sites and the other 
New.net extensions. .KIDS Domains has served as the registry for .kids; 
it has established rigorous Terms of Use and Content Guidelines that 
sites must adhere to in order to be included in the .kids space.
    New.net agreed to work with .KIDS Domains because we were impressed 
with the well-conceived, comprehensive nature of .KIDS Domains' 
policies. We immediately appreciated the value and usefulness of a 
.kids space for parents and children. Releasing a ``.kids'' extension 
fit well with New.net's mission of giving consumers access to more 
descriptive and relevant domain name addresses than is allowed by the 
current ICANN system.
    An example is Adopting.Kids which had the web address 
adoptanangel.org. Adopt An Angel International is a non-profit licensed 
adoption agency located in Jasper, Georgia. The Internet provides Adopt 
An Angel with a powerful tool to achieve its goal of helping homeless 
children across the world find a family and a home. The Internet is 
uniquely suited to Adopt An Angel's mission, and yet this group does 
not have a large advertising budget for promoting its services or its 
web address. An easy-to-find address is therefore critical to its 
success. The new address for the group--Adopting.kids--provides Adopt 
An Angel with the ability to reach parents far more easily with a 
descriptive and simple to remember name.
    Another example is Heart.kids, a site dedicated to providing 
support for children with Hypoplastic Left Heart Syndrome, a serious 
congenital heart defect that affects approximately 1 in every 5,000 
babies born. This organization had been using LeftHeart.org as its 
site, but the ability to use the more descriptive Heart.kids enables 
this group to clearly indicate that this site focuses on a medical 
condition that affects children.
    A final example is an organization, Jumpstart, that pairs highly-
trained college students with preschool children struggling in Head 
Start or other early learning programs. The name jumpstart.org was not 
available, having been taken by another organization, so the group was 
using jstart.org. With the opening of .kids, this organization was able 
to get a more descriptive name, jumpstart.kids, that is easy to 
remember and clearly indicates to users that it is a site focused on 
children.
    As you know, .KIDS Domains applied to ICANN for adoption of a .kids 
extension but its request was rejected. While ICANN did not state 
explicitly why it did not approve .kids (and scores of other new TLD 
requests), in the case of .kids it appeared that ICANN was concerned 
that it would not be able to reach a broad, worldwide agreement on what 
was appropriate for ``kid-friendly'' content.
    New.net's entry into the domain name business enabled .KIDS Domains 
to make the .kids extension available, without harm to the integrity of 
the Internet infrastructure or the ICANN system, and to the great 
benefit of parents and children. As a private company, New.net has been 
able to offer a much-needed and desired service free from the 
limitations of the current ICANN TLD selection process and in an open 
manner which empowers parents to make their own decisions about what is 
right for their families. We respectfully submit that the New.net and 
.KIDS Domains experience provides a model for, and proof of, how market 
forces can work effectively to prove the value of a domain name. As 
shown by our work with .KIDS Domains, we believe that the private 
sector can play a leading role in providing a ``testbed'' for the 
introduction of innovative and creative domain names that are valuable 
and useful to consumers and that should be widely accessible to 
Internet users.
    Given our positive experience with releasing the ``.kids'' domain 
in partnership with .KIDS Domains, New.net is pleased to share with you 
our views regarding H.R. 2417 introduced by Congressman Shimkus and 
Congressman Markey. We also are pleased to address potential proposals 
to amend the legislation to establish .kids as a second level domain 
within the .us country code top level domain (``ccTLD'').
    New.net commends Congressmen Shimkus and Markey for introducing 
H.R. 2417 to highlight the benefits of establishing a ``.kids'' space 
on the Internet which will result in a community of kid-friendly, 
``safe'' websites dedicated to children. In our view, the introduction 
of this measure also highlighted the broader concern that current ICANN 
processes and procedures for selecting new top level domains are far 
too limited and slow, and that American consumers and businesses are 
not getting the full convenience and benefits they could be getting 
from the Internet as a result. New.net believes that the consideration 
of this legislation puts a spotlight on the strong need to improve the 
system by which top level domain names are selected so that consumers 
benefit and marketplace competition and innovation are allowed to 
flourish. We fully agree with Congressmen Shimkus and Markey that 
establishment of a .kids top level domain would be extremely useful to 
consumers.
    As noted above, the current system that ICANN uses for selecting 
TLDs has not successfully resulted in the establishment of the .kids 
TLD, despite the value it would add for Internet users wanting to use 
it. New.net therefore understands that other, short-term options may be 
considered to accelerate the broader availability of a .kids site 
without having to confront the restrictions of the current ICANN 
system. One way that the artificial limitations of the ICANN selection 
process could be avoided is through an expanded use of the ``.us'' 
ccTLD involving the creation of second level domains on a competitive 
basis. New.net understands that the Subcommittee may consider a 
proposal to amend H.R. 2417 as introduced in order to establish 
``.kids'' as a second level domain within ``.us.'' New.net believes 
that this proposal has merit and has the potential to serve as a model 
for invigorating the ``.us'' top level domain effectively. For this 
proposal to be successful we underscore, however, the need for it to be 
carefully crafted with key pro-competition and pro-consumer 
requirements. Absent these provisions, the expansion of the ``.us'' 
extension could result in unfair competition, artificial limitations on 
second level domains and wholly unjust enrichment of certain commercial 
entities over others. Given the origins of the ``.us'' domain as a 
public asset, it is critical that the expansion of its uses, 
particularly with respect to second level domains, accrue to the 
benefit of the general public according to fair and competitive 
principles.
    At a minimum, we have the following recommendations regarding the 
establishment of .kids as a second level domain within the .us ccTLD:

1. If .kids is established as a second level domain within the .us 
        ccTLD, a registry operator must be selected to manage it. This 
        entity should be selected by NTIA through a competitive 
        application process, and one of the key and explicit factors in 
        the selection of the entity should be the demonstration of 
        experience in operating services designed to protect children 
        on the Internet. In addition, the registry for the ``.us'' 
        ccTLD should not be eligible to serve as the second level 
        domain registry operator.
2. Existing domain name holders under ``.kids'' should be able to take 
        advantage of a ``sunrise'' period in which they have the first 
        right to be registered under ``.kids.us'' (e.g., for a 
        reasonable ``sunrise'' period, the entity that has registered 
        and is operating ``tutor.kids'' should have the first right to 
        register as ``tutor.kids.us'', if this entity so desires.) 
        Without this provision, the establishment of a .kids second 
        level domain would be unfair to existing customers of ``.kids'' 
        and would be tantamount to ``nationalizing'' a private American 
        company (i.e. .KIDS Domains, Inc., through its partnership with 
        New.net) that took the risk of introducing a good idea to the 
        market, investing in it and developing it.
    New.net further believes that taking this course of action with 
.kids will provide a crucial learning experience that could well be 
extended to other second-level domains under .us. Extension of these 
and other pro-competitive principles to other second level domains 
could provide additional opportunities for the American entrepreneurial 
spirit to flourish on the Internet and for consumers to benefit from a 
diversity of companies and organizations competing to provide needed 
services.
    New.net firmly believes that the marketplace is a powerful 
consensus engine, providing a direct and immediate way for consumers to 
express their collective wisdom about which names they find most 
useful. In a very short time, the New.net business model has provided a 
``testbed'' demonstrating the popularity and value of user-friendly 
domain names and highlighting the failures in the current domain name 
selection process that have denied Internet users these desired 
benefits and conveniences. With the proper safeguards in place, 
diversity, the American entrepreneurial spirit, and creativity can 
flourish through the competitive provision of second level domains 
within the ``.us'' ccTLD.
    Mr. Chairman, thank you for the privilege of appearing before the 
Subcommittee today, and I would be pleased to answer any questions you 
may have.

    Mr. Upton. Thank you.
    Mr. Howe?

                    STATEMENT OF H. PAGE HOWE

    Mr. Howe. Good morning, Mr. Chairman, and members of the 
committee. Thank you for inviting me to be here today.
    I am pleased to speak on an issue of vital importance to 
parents and their children. More and more, we see parental 
anxieties and fears about the safety of the Internet. 
Widespread concern exists for parents equipped with extensive 
knowledge of technology, as well as those just discovering the 
Internet. As founder and chairman of KIDS Domains, I have 
personally overseen and funded our initiative to establish dot 
kids as a restricted top-level domain name available to all 
Internet users.
    To date, efforts to regulate the Internet have had to 
overcome hurdles of what is obscene or what is illegal, as well 
as how to implement those laws within a venue, the Internet, 
where many behaviors are legal for adults. The inherent lack of 
defined national boundaries, free speech issues, specific legal 
issues regarding control of existing content providers have 
been a barrier to what we believe is the sincere intent of this 
committee and the entire Congress to solve this issue.
    Dot kids is a solution from the private sector, a voluntary 
space created first and foremost for kids and the parents of 
those kids who wish to limit the scope of their children's 
access on the Internet when they are not present and to protect 
and guide their child's experience. In addition, we believe dot 
kids will help libraries and schools to effectively meet the 
mandates set out to create publicly available, but kid-friendly 
access to the Internet.
    Currently, it is a one-size-fits-all Internet. Entrusting 
the existing dot com space and its web site operators that they 
will deliver content to all audiences does not work. Web sites 
attempting to reach multiple audiences can be too complex, 
especially for kids, reducing the relevancy of the content they 
deliver to children. In addition, children are legally unable 
to enter into contracts, so web sites that desire to register 
users, have users join mailing lists, acknowledge policies, 
sign away rights, or in other words do business on a buyer 
beware basis, are not appropriate for interaction with kids. A 
registry of dot kids domain addresses will help those 
institutions and parents who want to and have the right to make 
choices for children.
    In addition, by educating and building a community of 
content providers who are delivering content specifically for 
children, children are empowered to make their own choices at 
the keyboard level. Today's youth will become empowered to seek 
out the wonderful educational, entertainment-oriented and 
communication experiences the worldwide web has to offer.
    Consider for a moment if some of today's more popular 
public venues operated without the benefit of segmentation. The 
Internet today would be like movie theaters, showing offerings 
of all movies, even the most vulgar, all day, with the doors 
open for free for people to enter; newsstands and bookstores 
with racist propaganda mixed in haphazardly next to comic 
books; casinos with no age restrictions; grocery stores with 
cigarettes on the candy rack; a police squad that when it finds 
a crime, may or may not know the true owner of the business and 
may have no jurisdiction over what is being done or shown.
    We are positive on the possibilities and potential of the 
Internet to educate, communicate and bring knowledge and 
entertainment to kids worldwide. It is a dynamic, low-cost 
media that can deliver to any child the cumulative knowledge or 
experience of kids worldwide. We believe parents are most 
fearful because even a minimum safety level does not exist on 
the Internet. We do not propose to restrict content on the dot 
com net-or org-developed public spaces. When we say dot kids is 
restricted, mean it is restricted to those registrants who have 
agreed up front to operate kid-friendly web sites; to enter 
into a binding agreement with the registry operator outlining 
the registrant's acknowledgement of the content guidelines; to 
an annual auditing process and reeducation each year of the 
laws, regulations and guidelines regarding dot kids.
    So why are we here? We are here because we can and have 
created a dot kids, but we cannot get access to the one and 
only directory of web sites administered by ICANN. We did try, 
however. We submitted a comprehensive application to ICANN, 
along with a $50,000 fee, as part of last year's selection 
process. Our application to ICANN was the only application that 
met the threshold requirements and the only one which proposed 
a restricted space.
    We believe introducing dot kids would go a long way to 
showing what can be done by opening up the A root to new TLDs 
which are not just duplicates of dot com, which create more 
confusion, but are intelligent choices for the segmentation of 
the DNS. The Commission on Online Child Protection studied a 
wide range of technologies. They concluded that a green space 
like dot kids would be most effective in reducing access to 
obscene material, while maintaining accessibility and 
minimizing adverse effects.
    Since the time of the hearing, the bill has been amended 
and now concerns the allocation of a second-level domain name, 
kids dot U.S. To the degree which kids dot U.S. is the end 
result of attempts by this committee to create a safe haven on 
the Internet, .KIDS Domains intends to actively pursue becoming 
the registry operator. We believe we can create a positive, 
relevant, engaging and safe green space.
    Thank you for your interest in dot kids, for your efforts 
surrounding this bill, and for the opportunity to address the 
committee today.
    [The prepared statement of H. Page Howe follows:]
        Prepared Statement of H. Page Howe, .KIDS Domains, Inc.
Introduction
    Mr. Chairman and members of the Committee, thank you for inviting 
me to be here today. I am pleased to speak on an issue of vital 
importance to parents and their children. More and more, we see 
parental anxieties and fears about the safety of the internet. 
Widespread concerns exist in the cities and extend out into the 
country; they are shared within our nation as well as abroad; they 
touch parents equipped with extensive knowledge of technology as well 
as those just discovering the Internet.
    As founder and Chairman of .KIDS Domains, Inc., I have personally 
overseen and funded an initiative to establish .kids as a restricted 
Top Level Domain accessible to all Internet users. I would like to 
acknowledge and thank Congressman Shimkus, and Congressman Markey and 
their staffs for their efforts in sponsoring H.R. 2417, as well as the 
staff of this committee. In addition, I also would like to thank and 
commend the other Representatives who have co-sponsored the Bill. I 
would like to acknowledge the work done prior to the introduction of 
this bill, including the sponsoring Representatives and Senators of the 
Child Online Protection Act, the Children's Online Privacy Protection 
Act of 1998, the Communications Decency Act of 1995, as well as the 
members of the COPA Commission, whose work over 1999 and 2000 has 
largely gone unnoticed and unimplemented. Finally, I would like to 
acknowledge additional groups operating to educate the public on child 
safety issues on the internet such as cyberangels.com, getnetwise.org, 
the Internet Content Rating Agency (ICRA), NetMom, and SafeKids; all 
have made strides in educating the public on how to best manage 
children's interaction with the Internet.
    With my testimony, I will seek to illuminate for the Committee the 
need we perceive exists for .kids and the reasons this solution alone 
is optimal.
    To date, efforts to regulate the internet have had to overcome 
hurdles of what is obscene or what is illegal, as well as how to 
implement those laws within in a venue, the internet, where many 
behaviors are legal for adults. The inherent lack of defined national 
boundaries on the internet, free speech issues, and specific legal 
issues regarding control of existing content providers have been a 
barrier to what we believe is the sincere intent of this committee and 
the entire Congress to solve this issue.
    .Kids is a solution from the private sector, a voluntary space 
created first and foremost for kids and the parents of those kids who 
wish to limit the scope of their children's access on the internet when 
they are not present to protect and guide their child's experience. In 
addition, we believe .kids will help libraries and schools to 
effectively meet the mandates set out to create publicly available but 
kid-friendly access to the internet.
The Internet today, One-Size Doesn't Fit All
    Currently it's a one-size-fits-all Internet and trusting that the 
existing ``.com'' space and its website operators will deliver content 
to all audiences does not work. Websites attempting to reach multiple 
audiences are too complex, especially for kids, reducing the relevancy 
of the content they deliver to children. In addition, children are 
legally unable to enter into contracts, so websites that desire to 
register users, have users join mailing lists, acknowledge policies and 
rules, sign away rights; or in other words to generally do business on 
a ``buyer beware'' basis, are not appropriate for interaction with 
kids.
    A registry of .kids domain addresses will help those institutions 
and parents who want to, and have the right to, make choices for 
children. In addition, by educating and building a community of content 
providers who are delivering content specifically for children, 
children are empowered to make their own choices at the keyboard level. 
Today's youth will become empowered to seek out the wonderful 
educational, entertainment oriented, and communication experiences the 
World Wide Web has to offer.
    Consider for a moment if some of today's more popular public venues 
operated without the benefit of segmentation of content and objects on 
the basis of age . . .
    The Internet today is like:

Movie theatres offering showings of all movies, even the most vulgar, 
        all day with the doors open for all to enter or explore, free.
Newsstands and bookstores with racist propaganda mixed in haphazardly 
        next to comic books and Teen magazines.
Casinos with no age restrictions
Sporting Goods stores with guns and rifles displayed and available at 
        eye level next to swim fins and basketballs.
Grocery Stores with cigarettes on the candy rack.
A police squad than when it finds a crime, may or may not know the true 
        owner of the business, and may have no jurisdiction over what 
        is being done or shown.
    We are positive on the possibilities and potential of the Internet 
to educate, communicate and bring knowledge and entertainment to kids 
worldwide. It is a dynamic, low cost media that can deliver to any 
child the cumulative knowledge or experience of kids worldwide. 
Unfortunately, between the unclear and evolving beginnings of the 
internet, the ``dot-com''' era of the past three years, the absence any 
controls whatsoever, and techniques and tactics designed to trap users, 
the internet today is made up of companies pursuing dominating, 
monopolistic, business models surrounded by abandoned sites and domain 
names, domain names without content, websites containing tools to 
provide revenue, unclear authority, and generally an environment where 
even adults who are used to being on their guard can have trouble 
navigating through the junk.
    We believe parents are most fearful because even a minimum safety 
level does not exist. In the debate over .kids and whether certain 
content is kid-friendly or appropriate, at least we will have moved the 
argument to the difference between G and PG13, not G and X.. And most 
importantly, sites within the .kids network cannot simply rely on a 
claim that the content is meant for adults.
.KIDS is for kids
    So what is .kids? At the DNS level the top level domain acts as the 
beginning of the internet's directory system. For instance, when an 
internet user types in www.congress.gov, the first thing their computer 
does is to query the internet's directory system to find out what the 
numeric address of the computer is that is ``hosting'' the US Congress 
website. In the same way, the .kids initiative will allow only those 
websites which have agreed to the Content Guidelines to have .kids 
domain names that resolve for internet users. By the same token, that 
resolution can be instantly blocked if a website violates the 
Guidelines and publishes inappropriate content.
    We don't think it makes sense to unleash kids into the current 
internet environment. We support the creation of a .kids top level 
domain, a community of website owners who agree up front to abide by 
the clearly defined and delineated ``Content Guidelines'' (established 
by an Independent Content Policy Board) of the .kids network.
    We do not propose to restrict any content on the .com, .net and 
.org developed public spaces. When we say .kids is a restricted domain 
name, we mean it is restricted to those registrants and a community of 
website owners who themselves have agreed:

To operate kid-friendly websites,
To have their websites in a safe and monitored ``greenspace'',
To enter into a binding agreement with the registry outlining the 
        registrant's acknowledgement of the Content Guidelines and 
        Terms of Use,
To supporting a systematic protocol for swift attention to those sites 
        and URLs which may be in violation of the Content Guidelines,
To an Annual Auditing Process and reeducation each year of the laws, 
        regulations, and guidelines regarding kids,
To the education of registrants, users, and the Internet Community at 
        large on child safety and protection issues on the Internet,
And, to an emphasis on providing child safety, children's 
        infrastructure, and child empowerment non-profit organizations 
        with meaningful charitable funding.
    Parents and kids can then trust that a domain name owner and 
registrant are accountable, and websites and content within the .kids 
network are kid-friendly. Parents always have the choice of letting 
their kids browse the whole internet and Congress will still need to 
fight to possibly reign in the excesses of the .com world.
So why are we here?
    We are here because we can and have created this .kids community, 
but we can't get access to the one and only directory of website 
addresses administered by ICANN.
    We did try however.
    In November of last year we submitted a comprehensive application 
to ICANN, along with $50,000, as part of the TLD selection process. Our 
application to ICANN was the only application for a .kids TLD which met 
ICANN's ``Threshold'' requirements, and the only one which proposes a 
restricted sponsored name space.
    Today, a full year later, ICANN continues to wrestle with the 
implementation of the TLD process. As was discussed earlier this year 
in this committee and others, the ICANN application process originally 
envisioned a formal application, in person interviews, a board decision 
process and implementation by January of 2001.
    In our case, our proposal for .kids was thrown in with others who 
wanted the name .kids, but who offered no controls over any of the 
content. It was even included in the same category with .xxx,--an adult 
only proposal which also wanted to administer a .kids. I have not been 
asked to give my testimony about the ICANN application process or about 
the role of ICANN in general, and so I will simply characterize our 
experience of the TLD application process as frustrating and 
disappointing.
    We believe introducing .kids would go a long way in showing what 
can be done by opening up the A Root to new TLDs which are not simply 
duplicates of .com (which creates more confusion), but are intelligent 
choices for the segmentation of the DNS.
    Since the time of the initially scheduled hearing, the Bill has 
been amended significantly and now concerns the allocation of the 
second level domain, kids.us. To the degree to which kids.us is the end 
result of attempts by the legislature to create a safe haven on the 
Internet for children, .KIDS Domains intends to actively pursue 
becoming the registry operator for kids.us .
    We believe a .kids TLD can effectively create a positive, relevant, 
engaging, and safe ``greenspace'' on the Internet for kids. In 
addition, creating a .kids space will increase the potential 
effectiveness of existing filtering and child-safety software tools. 
The only barrier to the operation of such a safe-haven for children is 
an action by an authority so empowered that would change the root zone 
to allow for the inclusion of a .kids.
Conclusion
    COPA, the Commission on Online Child Protection, has studied a wide 
range of child-protective technologies and methods. They concluded that 
a ``greenspace''' (a restricted .kids) would be most effective in 
reducing access to obscene material while maintaining accessibility and 
minimizing adverse effects. The only negative that the Commission 
outlined regarding a .kids extension was that one did not yet exist.
    Thank you for your interest in .kids, for your efforts surrounding 
this bill, and for the opportunity to address this committee today. I 
would be pleased to answer any of your questions.

    Mr. Upton. Well, thank you. You all heard the buzzers. We 
have a vote on, and I think for us to hear the testimony fully 
that I think we will take a brief recess and go over and vote. 
And when we return, we will start with Mr. Taylor. So we will 
take about a 15 minute recess.
    [Brief recess.]
    Mr. Upton. The other members will come back. I saw Mr. 
Shimkus go in the back and others. We are expecting more votes 
in about an hour to an hour and a half, they are saying.
    So Mr. Taylor, again thank you for submitting your 
testimony in advance and we will proceed.

                  STATEMENT OF BRUCE A. TAYLOR

    Mr. Taylor. Mr. Chairman and members of the committee, I am 
not going to try to repeat what I said in my statement. I did 
make several recommendations. Probably the primary one I am 
concerned about is to add the other types or classes of 
pornography that should be excluded from this site. That is 
partly a lesson we learned in the Communications Decency Act, 
and in COPA to some extent. I think the Communications Decency 
Act chose to say we will enact indecency as the standard. If 
they had said indecency or anything above it-obscenity, harmful 
to minors, and child pornography, we would still have those 
other classes in effect under the Communications Decency Act, 
even though the Supreme Court said we couldn't enforce it, only 
against indecency.
    If the web had been regulated under the structure created 
by the CDA against obscenity and child pornography and maybe 
even material harmful to minors, we would have a lot less 
pornography on the web intruding on our children, being able to 
be accessed by our children like it or not, for this Congress 
to every year have to deal with. And it is true that the 
industry wants total control over the Internet. But the United 
States government built this, gave it away, put a lot of money 
into it every year. One of the things that they are concerned 
about is that everybody should be able to use it, and our kids 
are being used by it, more than they are allowed to use it.
    And by creating a dot kids domain, you may at least give 
them one place to go, and originally I was not so much in favor 
of it as I was in favor of law enforcement. I would like to see 
the FBI and the unit I used to work at the Justice Department 
prosecute the pornographers so they would not be there for us 
to have to deal with. A couple years ago when this committee 
had a hearing on the Child Online Protection Act, on COPA, we 
ran one word searches on several search engines, boy, girl, 
toys, cheerleaders, just to see what would come up on various 
search engines. They all came up with pornography links. If a 
kid clicks on any of those, they get to see hardcore 
unrestricted porn sites.
    There is a red light on the Internet that our kids are 
going to go to because they are drawn to it, and they get it 
when they are not even looking for that. If kids tried to 
download the Mars pictures on NASA.gov and they typed in 
``NASA,'' they got taken to NASA.com, which is a porn site. If 
they type in ``White House,'' they get taken to WhiteHouse.com, 
which is a porn site.
    There is a good reason for us to be worried, and if this 
domain is properly administered to say we are going to make a 
place that doesn't keep adults from doing whatever they are 
going to do elsewhere, and they should be prosecuted when they 
break the law elsewhere, but on this domain, even the Supreme 
Court's decision in Reno versus ACLU that said well, the 
Communications Decency Act was a little too broad for adults on 
the rest of the Internet, they cannot say the same thing about 
a dot kids. That is why I went through some of the citations of 
cases where the courts have said you cannot do to the rest of 
the Internet what you could do to protect children. It is 
exactly the same thing you are trying to do with dot kids that 
eliminates all those arguments.
    So I do think that it is a fair thing for Congress to be 
concerned about and to try to do something about it. I do not 
think it is a fair criticism to say ICANN or any other root or 
domain registration agency should be able to take away the 
right of people to have an Internet that everybody can use. So 
I think that the dot kids domain is a better idea now than it 
should have had to be a couple of years ago.
    I also think there are some concerns with it. It will be 
challenged. They will not challenge the creation of the domain. 
They will take that. But they will challenge the right of who 
has to go there or what restrictions you can put on people, and 
you cannot exclude me. And so there is going to be a fight over 
that, and I think keeping ``harmful to minors,'' and adding 
``indecency'' and putting ``obscenity'' and child porn is 
important, so you will still have an enforceable set of 
standards on this domain while they are fighting whether you 
can have ``harmful to minors,'' whether you could have 
``indecency.''
    So those are concerns that this Congress I think should 
address. And I also think some of the other suggestions about 
picking an administrator who is willing to or has to use 
filters to monitor it, to report to Congress--that those 
reports of people who violate the standards and conditions of 
the dot kids should be reported not only to the Department of 
Justice and FBI and local police departments, but there should 
be some follow-up and accountability to Congress.
    What are they doing about it? We have cyber-tip lines. We 
have people committing thousands of felonies of obscenity and 
child pornography. They are not being prosecuted. And after 9-
11, we are going to have a lot of terrorism enforcement that 
has to take a priority, but this, you know, the priority of the 
Internet for our kids to learn how to use it and share 
information, rather than being stalked by pedophiles and 
supplied by pornographers, is a legitimate concern that I am 
glad to see this committee take up.
    And I think this domain can do a lot of good things that 
this committee intends it to do. It may take a little more 
supervision and diligence to make it work and to force those to 
whom you entrust it to do what you ask them, but I think it is 
worth a try. And so to the extent that I think it is 
constitutional, that there are existing cases that can support 
it, that there is a compelling governmental interest to attempt 
it, I think those are arguments, at least if I can add my voice 
as someone who has been prosecuting obscenity cases since 1973, 
to my efforts to help you do that, that is my primary purpose 
in being here. And if there is more that we could submit to the 
record in legal opinion or factual as this bill progresses, we 
are here to do that.
    [The pepared statement of Bruce A. Taylor follows:]
   Prepared Statement of Bruce A. Taylor, President & Chief Counsel, 
             National Law Center for Children and Families
    Mr. Chairman and Members of the Committee: Thank you for the 
opportunity to provide testimony on H.R. 2417. As President and Chief 
Counsel of the National Law Center for Children and Families, it is my 
primary function to provide advice and assistance to legislators, law 
enforcement agencies, and public officials on the enforcement and 
improvement of federal and state laws prohibiting the unlawful traffic 
in child pornography, obscenity, pornography that is obscene for 
minors, and indecency, as well as on racketeering, prostitution, and 
the regulation of sexually oriented businesses. I have been prosecuting 
obscenity and vice offenses under state and federal laws since 1973, 
when I was an Assistant Prosecutor for the City of Cleveland, including 
over five years as a federal prosecutor with the Justice Department's 
Child Exploitation and Obscenity Section. I think I have prosecuted 
more obscenity cases than any attorney in this Country's history, 
amounting to about a hundred jury trials and a couple hundred appeal 
briefs on First Amendment related issues in such cases. Since joining 
the National Law Center's staff six years ago, I have been constantly 
involved in advising Congressional sponsors on several Internet related 
bills to restrict or control the unlawful or harmful traffic in 
pornography, especially in its accessibility to minor children. I have 
been a strong proponent of improving laws and legal remedies in this 
area, but have also supported immunities to enable Good Samaritan 
efforts by the Internet industry to voluntarily restrict access to 
pornography, hate sites, controlled substances and weapons, and other 
objectionable materials, as well as encouraged increased diligence and 
involvement by parents, educators, and others who share a role in 
safeguarding and educating our children and grand-children in their 
online experiences. In this latter regard, I served on the Steering 
Committee for the Internet-Online Summit a couple years ago to assist 
and encourage the Industry to formulate methods of supplying 
appropriate content and better safety for children and to provide and 
enable real protections for minors and tools for adult and parental 
supervision and protection of minor children while online.
    In support of the creation of a Dot Kids domain for the World Wide 
Web, I'd like to offer some thoughts on why such a domain could help 
children, what legislative and constitutional issues should be 
addressed, and how Congress can better assure that the new domain will 
accomplish its purpose of being a safe and educational online place for 
our kids to learn and play.
    The first statement I will make, therefore, shall be in support of 
the intent and purpose of this proposed act: to provide an Internet 
accessed WWW domain that will contain content, services, and facilities 
for use by minor children that is free of harmful and pornographic 
materials; that safeguards the privacy and safety of such adolescent 
users; and which provides a forum where minors have access to 
information and entertainment that is safe, lawful, and appropriate, 
while giving content providers access to children under conditions of 
agreement to comply with the pre-requisites mandated and intended by 
Congress for these purposes.
    In short, I submit that a Dot Kids domain can be a great service to 
our youth, is a constitutional means of accomplishing this result, and 
can be achieved with proper guidance from the Congress.
   i. a dot kids domain furthers a substantial governmental purpose:
    This act will help solve the problem we face today of giving our 
children and grand-children access to an Internet, WWWeb, and Usenet 
that have inordinate amounts of ``adult'' and pornographic and 
inappropriate materials, while balancing the ability of adults to use 
interactive computer services for lawful purposes without endangering 
such younger users. Among all the beneficial and potential means of 
balancing the means for making the Internet safe for children and/or 
providing a safe haven on the Internet for children, a separate and 
safeguarded Kids domain could provide an online playground, school, and 
library that real kids could enjoy and learn from without interfering 
with the content on the rest of the domains of the World Wide Web or 
other online services for adults or children. Building kids their own 
space in cyberspace is the least we can do for them amid the vast 
universe of information and services that the rest of us need or desire 
for ourselves. Whatever we adults do with our space, under the law or 
outside the law, need not and should not pollute the computer 
environment for those younger ones who need us for their protection, 
nurturing, education, and entertainment.
    Whatever success or frustration there may be to make ``the Internet 
more safe for children'', whether through laws, law enforcement, 
voluntary Good Samaritan efforts, or parental supervision, a Dot Kids 
domain can be that safe-haven for the kids to go until we adults 
achieve more success in giving them safe-access to the public areas of 
cyberspace or until, if we continue to fail, they are old enough to 
fend for themselves as adults in the electronic adult world they will 
inherit.
    For these reasons, I support efforts to create a children's domain 
on the Web where the rules are written for their protection and the 
adults who build and supply that domain are bound by those rules. I 
adamantly oppose the creation of a ``dot porn'' or ``dot sex'' domain, 
because I don't think we should elevate the pornography syndicates to a 
seat at the World Wide Web consortium or legitimize their ill-gotten 
gains and because I don't trust them to stay on their own vice domain 
and get off the cash-cow of the dot com domain. They'll take the red-
light district and fill it with porn and prostitution, but they'll 
never leave our children and families alone in the rest of cyberspace 
anymore than they do today. The pornography industry, by its very 
nature and purpose, has no respect for public morality and no respect 
for human dignity. Their nature is to exploit and their purpose is to 
seduce customers into continual addiction in pursuit of profit. Those 
are clear battle lines, on opposite sides of the law, and no one should 
expect more clarity or compromise than that. On the other hand, I do 
not oppose a Dot Kids domain, if created and operated for their benefit 
instead of ours. There are practical problems to face and solve, but I 
do not believe there should be serious constitutional problems with 
carving out a safe-zone for children, even though we don't surrender a 
vice-zone for adults.
    Constitutionally, the creation of a domain for minor children that 
is limited to information and images that are lawful and appropriate 
for them should be found by the courts to be within the surpassing 
governmental interest in protecting and educating our children. There 
will surely be challenges to the act, similar to those lodged against 
the Communications Decency Act of 1996 (CDA), Child Online Protection 
Act of 1998 (COPA), and the Children's Internet Protection Act of 2000 
(CIPA). Such challenges will not likely oppose the creation of the Kids 
zone, but will seek to enjoin the rules set by Congress to restrict the 
presence of pornography and other harmful or objectionable content 
within the zone. There is even a probable likelihood that a judge will 
enjoin the restrictive conditions for the Kids domain during the years 
of litigation over the legal objections raised to those conditions. 
Congress should consider, therefore, making the existence of the domain 
conditional on the application of the conditions for the domain, so 
that the domain will not remain online as a ``combat zone'' for kids if 
the courts strike down the restrictions against unprotected and 
inappropriate materials. Instead of adopting a ``severability'' clause 
that could separate the domain from its child-safety conditions, the 
act could require or allow the domain to be closed in the event the 
protective conditions are taken away.
          ii. a child-safe dot kids domain is constitutional:
    A separate domain for minor children can and should be governed by 
the constitutional principles of what is lawful and appropriate for 
minors, rather than adults, and the ability or effort to service and 
protect children in their own zone would not affect the ability of 
adults to engage in protected activities on any other domain. In a 
children's zone, there would be no constitutional violation in 
prohibiting the display or dissemination of sex or nudity that is 
``indecent'', soft-core adult pornography that is ``harmful to minors'' 
or ``obscene for minors'', hard-core adult pornography that is 
``obscene'' even for adults, or ``child pornography'' that sexually 
depicts children. Children have no constitutional right to any of those 
types of materials and adults have no constitutional right to display 
or disseminate such materials to minors.
    My first suggestion is to amend Section 2 of the act, subsection 
(b)(2), to expand the ``Green Light Approach'' to exclude not just that 
which is legally ``harmful to minors'', but all unprotected materials 
from which minors may be protected, to wit:
        ``The new domain shall be available for voluntary use as a 
        location only of material that is considered suitable for 
        minors and shall not be available for use as a location of any 
        material that is harmful to minors or obscene for minors (as 
        used in 47 U.S.C. Sec. 231 and explained in the Report to 
        accompany H.R. 3783, the Child Online Protection Act of 1998, 
        H. Rept. No. 105-775); indecent (as used in 47 U.S.C. Sec. 223 
        and explained in the Joint Explanatory Statement of the 
        Committee of Conference, Report for Pub. L. No. 104-104, the 
        Communications Decency Act of 1996, 1996 U.S.C.C.A.N. Leg. 
        Hist. 200-11); obscene (as used in 18 U.S.C. Sec. Sec. 1460-
        1470); or child pornography (as used in 18 U.S.C. 
        Sec. Sec. 2251, 2252, 2252A, and 2256).
    Restricting such materials from minors in a designated minors' 
facility would not infringe any rights of adults or minors, since none 
of those materials are lawful or protected for minors. The Supreme 
Court has discussed the impropriety of removing materials from a school 
library because of the ideas, message, politics, or religious views 
expressed, even though materials may be restricted if found to be 
``pervasively vulgar'' or lacking ``educational suitability''. See: 
Board of Education v. Pico, 457 U.S. 853, 870-72 (1982). The Court has 
also ruled that ``indecent'' materials may be prohibited from certain 
public media in order to protect minors and unconsenting adults, even 
the broadcast indecency prohibited from radio and television by 18 
U.S.C. Sec. 1464 and interpreted by the FCC and the Court in FCC v. 
Pacifica Foundation, 438 U.S. 726, 741-50 (1978). The Court has 
continued to recognize that minors are not entitled to indecent 
depictions or descriptions of sexual subject matter, even though minors 
may have a right to obtain non-indecent information about such subject 
matter. It is not the message or issue that is restricted, only the 
indecent way of conveying the message or illustrating the issue. The 
Court has, therefore, upheld the indecency standard when limited to 
minors, even when striking down the use of that standard when the 
restrictions would extend it to adults outside of the broadcast 
mediums, such as in certain attempted dial-porn, cable TV, or Internet 
indecency restrictions. See: Sable Communications of Cal., Inc. v. FCC, 
492 U.S. 115, 126 (1989) (indecent dial-porn); Denver Area Ed. Tel. 
Consortium v. FCC, 518 U.S. 727 (1996) (cable-casting indecency), and 
United States v. Playboy Entertainment Group, Inc., 529 U.S. 803 (2000) 
(scrambling indecency on cable TV); and Reno v. American Civil 
Liberties Union, 521 U.S. 844 (1997) (CDA's indecency provisions for 
Internet and other interactive computer services).
    Unlike the reasons accepted by the courts for declaring the 
indecency-display provisions of the CDA unconstitutional, that the 
indecency standard was overbroad when applied to public services of the 
Internet because they supposedly lacked technically feasible ways to 
restrict minors from the indecency without restricting it to adults, a 
Dot Kids domain can be avoided by adults themselves and its safe-harbor 
protections are not imposed on the rest of the Internet, Web, or Usenet 
so adults are not restricted from any indecency or ``harmful to 
minors'' materials to which they may be entitled. The reasonings 
adopted by the courts in the CDA and COPA litigations would not apply 
to a children's domain, since adults would not be restricted from any 
protected information on the rest of the Net. Restricting indecency and 
harmful to minors pornography, as well as obscenity and child 
pornography, from minors' areas would be consistent with the limited 
venue restrictions against less-than-obscene pornography in other 
contexts, such as prison-porn restrictions, Thornburgh v. Abbott, 490 
U.S. 401 (1989), and Amatel v. Reno, 156 F.3d 192 (D.C. Cir. 1998); 
restricting porn on military installations, General Media 
Communications, Inc. v. Cohen, 131 F.3d 273 (2d Cir. 1997); restricting 
arts funding by considerations that include indecency, National 
Endowment for the Arts v. Finley, 524 U.S. 569 (1998); permitting 
private indecency restrictions by cable TV operators, Loce v. Time 
Warner, 191 F.3d 256 (2d Cir. 1999); and permitting state governments 
to restrict pornography access on state-owned or funded computers, 
Urofsky v. Gilmore, 216 F.3d 401 (4th Cir. 2000). The Dot Kids domain 
would also be consistent with the intent of Congress to provide 
filtered access by minors to federally subsidized Internet access in 
public schools and libraries through the Children's Internet Protection 
Act of 2000. Due to the separate and designated nature of the Kids-
Friendly Domain to be created by this act, the constitutionality of 
this act can and should be secure regardless of the eventual result of 
the challenges to the COPA, CIPA, or other laws placing restrictions 
for pornography on public areas of the Net. A Kids domain makes a kid-
safe part of the Internet, rather than attempting to make other parts 
of the Internet safe for kids. All classes of materials that are 
unprotected for minors may be restricted from minors on the minors' 
domain without restricting any such material for adults. Therefore, it 
is my opinion that this act is constitutionally valid and enforceable.
   iii. further clarifications and suggestions should be considered:
    Congress can anticipate certain probable and potential challenges 
and issues and I submit a few such areas of consideration:
    (a) As suggested above, the act can and should prohibit from the 
Kids domain, under Sub-section (b)(2), not just pornography that is 
``harmful to minors'', but also the other unlawful and unprotected 
classes of pornography for minors and adults, including child 
pornography, obscenity, and indecency (which could be both the 
broadcast indecency material used for radio, TV, and cable, as well as 
the ``online indecency'' material intended for interactive computer 
services, as discussed in the Conference Report on the CDA and in the 
Brief of Members of Congress . . . as Amici Curiae in Reno v. ACLU, 
supra;
    (b) Consider a statement of legislative intent to create the Kids 
domain for the age group(s) of minors of either or both grade school or 
high school levels;
    (c) Consider requiring that the domain managers and site operators 
filter the domain with software and server-based content filters (as 
required by the Children's Internet Protection Act, CIPA), require 
mandatory use of content ratings (such as those of the Internet Content 
Rating Association, ICRA's PICS-compliant rating system), and privacy 
protection measures to prevent minors from being targeted by direct 
marketing that uses or discloses personal identification information 
about or by the minors (as required by the Children's Privacy 
Protection Act). Employing these Congressional and industry measures in 
an actual domain would provide a real-world test environment within 
which to make use of and demonstrate the effectiveness of Congressional 
protections intended by those acts and enabled by the Good Samaritan 
immunities and defenses granted to industry as part of the CDA in 47 
U.S.C. Sec. .223 (b) and (c);
    (d) Consider mandating that domain managers and site operators 
monitor compliance and provide automatic reporting and tiplines to law 
enforcement agencies, both state and federal, as well as to Congress 
for re-evaluation and enforcement of the act's purposes and guidelines;
    (e) Consider preference to or involvement of filtering companies in 
structure and operation of the domain, to insure that domain managers 
will give effect to Congressional intent, instead of entrusting such an 
important function and public asset to managers or operators who would 
frustrate the purposes of the domain;
    (f) Consider having only filtered portals, if any, for safe access 
or links to information on other domains, online services, and Usenet 
newsgroups;
    (g) Consider prohibiting interactive and un-moderated chat rooms 
and instant message boards;
    (h) Consider prohibiting Sexually Oriented Advertisements 
(``SOA''), as that term is used to restrict mailings for pornographic 
materials in the Postal codes under 39 U.S.C. Sec. Sec. 3008, 3010 and 
18 U.S.C. Sec. Sec. 1735, 1737, including banner or pop-up ads 
containing any obscene, harmful to minors, or indecent material or 
giving information on how or where to obtain such information, as 
prohibited from the mails by 18 U.S.C. Sec. 1461;
    (i) Consider restricting unsolicited or unapproved advertisements 
and spamming, especially for products or services that are unlawful for 
or restricted from minors, such as alcohol, drugs, weapons, tobacco 
products, for pornography that is obscene for adults, obscene for 
minors (HTM), or indecent, or even for sexual masturbation or abuse 
devices (such as defined by Georgia, Texas, and Alabama state statutes 
which have been upheld).
    For all these reasons, the Dot Kids Domain Name Act of 2001 is a 
good and wise effort to protect minor children and allow them to share 
in using the Internet as it was meant to be used and as it was created 
by the Congress for the benefit of all the world.

    Mr. Upton. Thank you. Thank you very much.
    Ms. Hughes? Welcome.

                 STATEMENT OF DONNA RICE HUGHES

    Ms. Hughes. Thank you.
    Thank you, Mr. Chairman, and members of the subcommittee. I 
appreciate the opportunity to come before you today to discuss 
the merits and the issues around the Dot Kids Domain Name Act.
    I have worked in various capacities for the past 8 years, 
and just recently last year served on the COPA Commission and 
will be referring to our report, and also had the opportunity 
to co-chair our hearings last summer on filtering and 
monitoring.
    I respectfully request that the entirety of my prepared 
slide presentation and the executive summary of the COPA 
Commission's report to Congress be included as part of the 
record of today's hearing.
    Mr. Upton. Without objection.
    Ms. Hughes. Thank you.
    I would like to draw your attention to a slide presentation 
that I put together, and I am going to try to flip through this 
and stay within my 5 minutes, hopefully. Because we are not 
clicking through on an actual powerpoint, it might be a little 
more cumbersome, so if you could please bear with me.
    If you go to page one, and we will just flip through this 
very quickly, I am setting up here again the online dangers to 
kids. Kids' access to all kinds of material, not just 
pornography, obscenity and child pornography, but other kinds 
of objectionable material, such as gambling, hate sites, 
violence, bomb-making--you name it; also, the fact that 
predators have easy access to children.
    Next page--91 percent of kids coming across any of this 
objectionable material are doing so accidentally. The cyber-
porn industry is very aggressive and deceptive and they are 
getting worse. Kids, like Bruce said, can type in any kind of 
innocent word like boys, toys; there are stealth sites. I have 
listed some of them here--coffee bean supply, water sports dot 
com.
    If you go to the next page, I have given you two statistics 
on the pornographers' use of brand names targeted to children--
names like Pokemon that have links to hardcore porn sites. This 
is one of the reasons that filtering and technological 
supplication is going to be an important part of the 
utilization of this green space.
    The following slide--child pornography and obscenity--you 
can see in misleading sites like water sports dot com, the 
kinds of free pictures that are there--urination pornography; 
stuff that ought to be prosecuted; boys dot com. There has been 
a 345 percent increase in child pornography sites just since 
February of this year--again, a tremendous need to enforce the 
laws that we already have on the books.
    The following slide--even Yahoo is engaging in allowing 
child pornography and obscenity on their site. I have just 
given you a couple of examples of clubs that anyone, any child 
can find on Yahoo--the Yahoo's Young Girl and Boy Club that 
contains child pornography.
    Okay. Now to the solutions. For years, we have been working 
to promote a three-prong approach--the need for the public, the 
technology industry and the legal community to partner with 
each other. And I see the dot com act that is being presented 
here as a part of a combination of these three prongs, if you 
will.
    The following page, the Dot Kids Domain Name Act would 
provide easy access to kid-friendly content, and would empower 
parents and would be an important part of a total solution. 
However, the criteria for the content I believe must be clearly 
defined.
    The next slide--it would effectively shield children from 
HTM content if the children were restricted to that zone, and 
we actually found that in the COPA hearings last summer.
    The following page deals with the domain operator. I 
believe that this operator should be a trusted and experienced 
entity in the following: the aggregation of children's content; 
online child safety and safety technology solutions. I have 
included here a client of mine on the bottom slide, Family 
Click, and I think this is a good model for you to consider, or 
for the operator of this domain to consider. If you look down 
here at the most restrictive area, play click, that is a 
restricted green space. If a parent chooses that, they get only 
pre-approved sites, and they cannot get out of that. The 
between play click and full click, you have different levels of 
different kinds of inappropriate content being blocked by real-
time filters. Okay? It is not until you get up to the full 
click that you are actually just blocking pornography, hate, 
violence and gambling.
    All right? The following slide are recommendations. I do 
believe that this domain should exclude chat rooms and instant 
messaging. Eighty-nine percent of sexual solicitations were 
made in either chat rooms or instant messaging, and I have some 
stats here for you. Also exclude e-mail--30 percent of spam was 
pornographic or is pornographic. Also considering marketing 
issues to children and COPA compliance is very important.
    This bottom slide is very important. If you say only 
children can go there, recognize that children themselves are 
perpetrators. One in five children last year received a sexual 
solicitation on the Internet. Of those solicitations, 48 
percent of them were by juveniles. All right? And of online 
harassment, 63 percent were juveniles harassing other people, 
other children primarily.
    The following slide is technology supplementation. It is 
very important in my opinion for there to be real-time 
monitoring to ensure that the content and the dot kids domain 
continually meets the criteria with which it has agreed. There 
is monitoring that will allow this to happen in real time. The 
example that I am using here is an Ernst and Young financial 
site for kids. Last week, they did not re-up their dot org 
domain. It was bought by a pornographer and is now operating as 
a porn site. If you do not have these monitoring features in 
place, you can have names change that quickly and parents who 
thought they had their kids in a trusted green space will have 
a false sense of security. Also, monitoring will guard against 
inappropriate links or changes.
    Additionally, filtering technology as a safety net is very, 
very key. Any savvy kid can reconfigure a browser. Just ask 
your own. Also, filtering technology will allow access to 
material that has not--that is appropriate for kids, but has 
not gotten to dot kids domain or has not registered in that 
area. And it also allows a great deal of flexibility.
    The next slide is the importance of safety education. We 
know that about half the parents are not using the tools that 
are available to them. They are not as savvy as we wish they 
were. We must have a major public awareness campaign, not only 
around this domain and the advertising of it, but of all the 
tools that are available. In fact, the COPA Commission 
recommended that government and private sector undertake a 
major campaign along the lines of Smokey the Bear, AIDS 
awareness; I mean, big dollars, big campaign, because parents 
are not using the tools that are available to them. And if they 
do not use this tool effectively, again, they could have a 
false sense of security.
    The COPA Commission report found that the establishment of 
a top-level domain could be an effective way to shield kids 
from harmful to minors content if the kids were restricted to 
the zone, and I have exactly our wording as far as what we 
found in our report. The next pages, again, we looked at First 
Amendment issues, effectiveness, accessibility, and all of our 
comments are here for the record.
    Finally, there is a scattergram of all the technologies and 
methods that we looked at, on the following page 11. And then 
last is again the importance of prosecuting the laws that we 
have. Parents cannot put criminals behind bars and government 
cannot parent. We all have to work together.
    Thank you.
    [The prepared statement of Donna Rice Hughes follows:]
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    Mr. Upton. Well, thank you very much, all of you, and sorry 
again for the interruption with that vote. We will now proceed 
to members to ask questions. We will use the 5-minute rule and 
we will go to a second round if we need to.
    Again, I want to compliment Mr. Markey and Mr. Shimkus, the 
authors of this bill. It is my intention, I will say right from 
the start, that we are intending to mark this up in 
subcommittee as soon as we can get a date. We are looking for 
your thoughtful and constructive comments so that we can make 
it an even stronger bill. And again, as I look at my own, just 
examples in my own home, I look at my daughter who turned 14 
this morning, ever since she saw the movie ``Babe,'' she has 
had a great love of pigs. And she does not eat pork anymore--no 
bacon or sausage at our house--and lots of little signs, ``Pigs 
Rule'' and everything else that she has in her locker at 
school.
    But when she plugged that into the computer, she found 
something else, very innocently a couple of years ago. And the 
examples, Mr. Taylor, that you use, it is really very troubling 
when that kind of garbage comes into a household, particularly 
if it is unwanted, as it is in ours. And that is why I feel so 
strongly that we have to move this legislation.
    And I guess, Ms. Victory, as we began to look at the 
contract that was signed this last weekend, and the reference 
that literally--I mean, this is the material that was 
supplemented as part of the contract, fairly thick--at least, 
and I am not a lawyer, but I do not see that there is a promise 
by NeuStar to do this. I do not see that there is a requirement 
for NeuStar to come up with a dot kids. I do not see a 
timeframe for them to implement.
    In fact, a number of the other dots that they reserve--but 
I mean, there are probably about 30 on here from apnic, to 
coop, to park and zip and whitehouse and veterans--you know, 
all good things, many of them we raised in our ICANN hearing 
last, I guess it was early this year, one of the very first 
hearings that we had, and there was a lot of frustration on 
this panel. And I, again, I thought we ought to have a dot 
travel. And we were all very frustrated with the ICANN folks 
who we would like to, you know, shake them in terms of their 
responsiveness to the needs of the consumer.
    And when I do not see a requirement or a timeframe--you 
know, maybe they start with dot park or maybe they go to dot 
PSO, or you know, some of these others, it may be, I do not 
know, 25, 30 years before they get to dot kids, though I think 
there is a lot of emphasis here on that. And our bill, the way 
that we are looking at doing it, particularly with the 
amendment, the chairman's amendment at the beginning that has 
been worked out with both sides--Mr. Markey supports it; Mr. 
Shimkus has been instrumental in pursuing it as well--says 
guess what? The game is up. We are going to do this. And we are 
going to do it as fast as we can because it might, in my view, 
it is the most important addition, first off, that we can do of 
all the ones that are out there, particularly for those of us 
parents.
    And I would like you to--and I do not know if they put on 
the table that there was going to be a requirement, or a 
timeframe or a promise that they would do it, but I sure do not 
find it in the stuff that we have looked at, and I welcome your 
thoughts, comments.
    Ms. Victory. Sure. When the procurement was initiated, 
there was at the time, since this was done a while back, no 
specific request on the part of the Department of Commerce that 
there must be a dot kids, dot U.S., nor was there a reservation 
of dot kids, dot U.S. out of the dot U.S. top-level domain that 
would be procured.
    NeuStar was one of the applicants that did propose use of 
certain second-level domains for various public purposes. Dot 
kids, you are right, is one example. They do not make a 
commitment to do it, but they do----
    Mr. Upton. Right. There is no guarantee that they are going 
to do it. And that is what our bill does. Our bill directs it 
to happen. I should say their bill, but it is our product in 
this committee.
    Ms. Victory. That is correct. The bill would direct it to 
happen. The problem is since the procurement was started many, 
many months ago, the bill would essentially change the 
procurement that was offered by the United States. And 
therefore it would subject the contract and the whole 
procurement process to challenges because all of a sudden 
instead of getting all of dot U.S., NeuStar would be getting 
dot U.S. minus dot kids. So not only could NeuStar----
    Mr. Upton. Let me ask--my time is expiring--let me just 
politely just stop just for 1 second and just say, you know, as 
a parent, I am not interested in excuses. I want it done. And 
it would seem to me that if we can direct this to happen, 
whether trying to open up the bidding process and use, I think, 
very legitimate firms that have a track record on this and let 
someone oversee to make sure that independent it gets done, is 
the right road to take. And if it means--and I know this 
contract took some time to negotiate, many months, started 
before you were sworn-in, that is for sure. But it seems to me 
that if we can get a legislative product to go around the track 
here on a pretty quick basis, that that would be something that 
this administration, particularly your office, would support as 
you could no longer say ``our hands are tied'' because of this 
bulky contract that started before my watch. Is that not right?
    Ms. Victory. If you pass the legislation, it is possible 
that the contract would be subject to legal challenges or it is 
possible that NeuStar would agree that this was a good idea and 
proceed. But that is not to say that others who were not 
successful in the procurement might now challenge it and say 
that they would have stood a better chance had they had the 
ability to pursue dot kids, or dot kids, dot U.S.
    Mr. Upton. My time has expired, but I will yield to Mr. 
Markey first, for 5 minutes.
    Mr. Markey. Thank you, Mr. Chairman, very much.
    Ms. Victory, I want to ask a quick question about the 
competitive implication of the dot U.S. contract that NTIA is 
pursuing with NeuStar. In telecommunications policy, we have a 
set policy of ensuring that telephone numbers are extended to 
citizens and competitors in a neutral way. That is a vitally 
important consideration in order to maintain the proverbial 
level playing field.
    Now, as we move toward new technology, and specifically 
technology such as Internet telephony, NTIA, in my opinion must 
think through these issues in its contract with NeuStar. The 
NeuStar proposal reserves all series of numbers over five 
digits, including telephone numbers. I want NTIA to look 
closely at the competitive and privacy implications of how 
those telephone numbers are treated.
    For example, my office telephone number is 202 225-2836. 
How will we treat the use of 202 225-2836.US for use as a web 
phone for Internet telephony? Do I get first dibs on my number 
for the last 25 years?
    Ms. Victory. I think that is a very valid question. That 
will be something that will need to be addressed with respect 
to those types of addresses.
    Mr. Markey. Do you think I should have first dibs on it?
    Ms. Victory. At this point, I do not have an opinion, but I 
could see why you would want first dibs to it, and I could see 
where there might be confusion if you did not have first dibs 
to it.
    Mr. Markey. Can you see why every American would want first 
dibs on the phone number they have had for their entire lives, 
and that they would not have to purchase it from one company or 
someplace that went out and started speculating on our phone 
numbers.
    Ms. Victory. This is sort of the idea of the number 
portability extension to your Internet address, essentially.
    Mr. Markey. Do you think that makes sense?
    Ms. Victory. I definitely see where that is something that 
folks might want, and that would definitely be an issue that 
would need to be addressed in giving out those types of 
addresses.
    Mr. Markey. I can tell you with absolute certitude that you 
do not even have to have a hearing on it. Just call your 
mother, call everyone else in your family, they will all tell 
you that they want their phone number protected, and they do 
not want any private company with control over it. Okay, I 
promise you it does not require anything more than that.
    I want to note that dot U.S. is the only country code 
America gets. It is all we have. NTIA has proposed 
commercializing the dot U.S. domain and granting a contract to 
NeuStar to run that domain. Now, in our previous ICANN hearing 
that Chairman Upton held in February, many members voiced 
consternation at the ICANN process because the creation of new 
top-level domains such as dot biz and dot pro were quasi-public 
assets with significant implications for Internet commerce.
    When looking at dot U.S., however, we are not talking about 
quasi-public assets, but rather a straightforward resource 
which belongs to the American people collectively. It is our 
national cyberspace domain. So you have announced giving 
NeuStar a contract to administer this national resource, and 
the opportunity to reap millions of dollars of profit for free. 
The United States government, in my opinion, should be long 
past the point where we give away public resources for free.
    I do not mind NeuStar making money, yet we only have one 
country code domain and we can give only one company the 
opportunity to profit from it. We auction off the spectrum. We 
license timber, natural gas, coal, oil rights on public lands. 
We do want those natural resources utilized for the benefit of 
the American people. But on the other hand, those companies pay 
the Federal Government and then the Federal Government can use 
that money to educate children, to have inoculation programs 
for children across the country with the money those companies 
pay out of their profits.
    We do not have that in the construct of this licensing as 
it is presently proposed by NTIA. Why wouldn't the NTIA support 
having all qualified applicants bid for the right to run our 
national domain? Or at least have our taxpayers reap fees from 
the sole commercial interest granted the right to make money 
off of this? What do the taxpayers receive from the NeuStar 
contract?
    Ms. Victory. The NeuStar contract was awarded pursuant to a 
procurement of management services. So what the U.S. taxpayer 
receives is management of the dot U.S. domain, as well as 
investment in the underlying technology that is used to manage 
the dot U.S. domain. NeuStar has committed, and indeed would 
need, to make a substantial technological investment in order 
to upgrade the top-level domain. In addition, they are going to 
be providing the management services for a period of 4 years. 
At that time, the contract is subject to two 1-year extensions. 
During that time, I would presume that NTIA might be looking at 
additional procurement for management of that space for an 
additional period of time.
    But right now, when this procurement was accomplished, NTIA 
does not have the authority to auction off top-level domain 
names. That is not in our statutory authority.
    Mr. Markey. Do you want that authority? We could give it to 
you. Would you like it?
    Mr. Upton. OMB is not in the room, I don't think.
    Mr. Markey. Would you like us to give that to you?
    Ms. Victory. Actually, at this point, I have not thought 
about the question--what my answer to that question would be 
before, but certainly in procurement----
    Mr. Markey. You know, there is a kind of--do you know Harry 
Houdini?
    Ms. Victory. Yes.
    Mr. Markey. He used to get tied up by other people. As a 
result, you know, he just could not move. A reverse Houdini is 
when you tie yourself up and then you say, look it, I would 
like to help you, but see my hands are tied. So what we are 
saying to you in this reverse Houdini of the Commerce 
Department saying it is impossible for us to do this. And then 
we say to you, how would you like us to untie your hands? And 
you say, well, we are not sure we want our hands untied because 
we are not sure we actually want to do that. That is a 
different question altogether.
    But in terms of our ability to be able to proceed in a way 
which extracts the maximum amount of public benefit for the 
taxpayers of our country using a competitive model, we think 
that what NTIA is doing is really going into kind of a time 
machine, going into a way-back machine where in the old days we 
actually used to give away the spectrum to the telephone 
companies. We would just give it to them.
    But then beginning in 1993, we said, well, that is stupid. 
And we instituted an auction whereby we said to all these 
companies, we know that the American people will be benefited 
by having companies make a profit from investing in new cell 
phone companies. But at the same time, they should have to pay 
for that because it is going to be beneficial to the company. 
What you have done here--not you personally; I know that this 
was something that was already in place before you got there--
but what the Commerce Department is doing is going back to an 
old model, a discredited model where we handed over for free to 
companies, and the taxpayers do not derive any benefit from it 
beyond just the fact that a company now has a service contract, 
if that is how you want to view it.
    And what we need to have is some way in which this, quote 
``burden''--the Commerce Department I think is viewing this as 
a burden on the agency--and therefore you have to contract with 
someone to relieve the agency of the burden to administer this 
domain area. And the way we view it is, it is not a burden, it 
is a tremendous opportunity in the same way that spectrum and 
timber and oil and gas are, and you should look for companies 
that view it that way, and then want to conduct it in the way 
in which the government would like to see it conducted, 
including putting a dot kids in place, okay, instead of hoping 
that they would.
    So it is kind of a different model that I think is going to 
be very troubling to this committee because it runs totally 
contrary to the modern history of this committee and its 
expectations for the Department of Commerce in terms of how you 
administer these programs.
    Ms. Victory. I think you make some good points. I would 
like to address your analogy with the spectrum. First of all, 
the reason we did not auction this is we do not have the 
authority. If we would have the authority, the question is 
whether it would make sense to auction management of the dot 
U.S. phase.
    I think, unlike where you are auctioning spectrum that a 
company is going to use for a commercial system they provide on 
a fee basis to subscribers, here you are talking about 
management of the dot U.S. space, management on behalf of the 
U.S. Government, as opposed to providing spectrum carte blanche 
to a company to create whatever system--to create the system 
they want to have, and then go ahead and have customers or 
subscribers who would pay for that system.
    Mr. Markey. Well, let me ask it a different way.
    Ms. Victory. I think the public interest justifications are 
a little different.
    Mr. Markey. And I appreciate your indulgence, Mr. Chairman, 
just one final question. How much is NeuStar going to pay the 
Commerce Department?
    Ms. Victory. NeuStar is not going to pay the Commerce 
Department, but the Commerce Department will be getting in 
return from them the management services of the dot U.S.----
    Mr. Markey. So they are not going to pay you anything. How 
much do you think it is worth to have this contract?
    Ms. Victory. I have no idea.
    Mr. Markey. Right. I think that is the problem. I would 
rather have had, if not a permanently leasing at all, just a 
bidding process to get the contract from you, and assuming they 
are all qualified bidders, then the taxpayers would have 
extracted something from it, and meanwhile you could have had 
all the other constraints upon it in terms of coming back every 
4 years or 6 years, whatever. But this way, I do not see the 
taxpayer receiving a benefit.
    Ms. Victory. And one of the concerns with the bidding 
process is are you going to--are all the bidders equally 
qualified and are you going to be able to----
    Mr. Markey. But you could establish that.
    I apologize, Mr. Chairman.
    Mr. Upton. Mr. Shimkus?
    Mr. Shimkus. It is always very helpful when you can get 
Congressman Markey on your side, so I want to--it is a mixed 
blessing, though, and I appreciate him and I appreciate his 
work on this.
    I want to just start with a short statement to the 
assistant secretary. Our frustration in the ICANN hearing is 
bubbling up here. Congress, through legislation signed by the 
president, we enact public policy. We do the public policy. 
Federal agencies implement the Federal policy. And that needs 
to be understood.
    So when Federal agencies say ``we cannot do it,'' well, 
that is why we do what we are doing today. Federal agencies 
also understand that we are the authorizing committees, and 
Federal agencies also have to understand that we are the 
funding agency. All appropriations by the Constitution go 
through the House.
    So we would like your help in moving this legislation 
forward because I think you will find out from the subcommittee 
and the full committee that this is a train that is going down 
the track, and we want to make it so that you can help us 
implement this to the best interest of our country and our 
kids. And the worst thing you could do is tell us you cannot do 
it. What you need to do is come to us and say, ``let's look at 
this and make it work.'' And that is just my speech. We get 
very frustrated when we hear ``we cannot do'' or other----
    I want to address this issue of the marketplace because I 
am a big marketplace individual. We just went through a hearing 
yesterday, though, on the Price-Anderson Act, which because 
some of us believe that nuclear power is essential to the 
Federal Government, we give them some liability protection--is 
that correct, Mr. Markey?--because we think that that is 
important for our energy security. There are some who disagree, 
and I have great respect for those who do.
    What kind of liability protections are there for the 
private corporation that you have contractual obligations for? 
Were there any liability protections?
    Ms. Victory. I am sorry. Liability protections for--?
    Mr. Shimkus. Why would people get sued--maybe a kid is 
allowed to get on the Internet, steal or use parental credit 
cards, go to offsite locations, run up gambling bills. There is 
a conflict created between corporations and companies and 
Internet service providers, and how are those resolved? How are 
conflicts resolved in our system?
    Ms. Victory. So you are asking whether or not in the dot 
U.S. contract with NeuStar, are there----
    Mr. Shimkus. I am asking, in a private corporate setting, 
is there liability protections for those people who are 
contracting and doing business on a contractual basis that you 
may have assigned with NeuStar?
    Ms. Victory. I am sorry. If you could repeat the question. 
I am not getting----
    Mr. Shimkus. Okay. Let me ask it a different way. Since we 
are trying to set up a kid-friendly space and since that space 
might prohibit the use of things, and I know a lot of my 
colleagues may address, like purchasing of children over the 
Internet, a limitation of banners, no instant messaging, no 
chat rooms, that makes that site probably less profitable for 
someone to sell out, contract out, however that is done. But we 
think as a country that it is so important to protect our kids 
that we are willing to do that. We promote that by giving 
someone a monopoly, in essence, with agreed upon oversight. 
With that could be liability protection.
    We do it, again, in other areas if we feel that it is as 
important, which would help offset some of the maybe costs that 
would occur to a business. You know, there is revenue that 
comes in for doing a business; there are expenses. If we are 
limiting the amount of revenue, then through liability 
protection, because we are empowering this through legislation, 
that there may be less of a cost of doing business because you 
have some protections that you do not have to hire lawyers for, 
and you do not have to be afraid of being sued out and actually 
sued to where you have to leave the business.
    So I see that as a benefit of the government involvement in 
this in a dot kids with the U.S. country code domain. And I 
would ask your comments based upon that whole long premise.
    Ms. Victory. Sure. Just to say first, Congressman Shimkus, 
we would like to work with you and your staff and we think this 
is a very worthwhile goal. We think that with the NeuStar 
contract there may be ways of accomplishing this more quickly 
than through legislation.
    Mr. Shimkus. And we respectfully disagree.
    Ms. Victory. Okay. What I tried to do today is just raise 
some concerns about what is currently in the manager's 
amendment.
    The question that you ask, would liability protection help 
in certain circumstances, probably it would, but it depends on 
what sort of shielding you are giving. Obviously, if you are 
trying to create a dot kids space or a child-friendly space 
somewhere on the Internet, there probably do need to be some 
rules of the road as to how people conduct themselves. And 
whether you do this through legislation or whether NeuStar does 
this or some other company does this through how it manages a 
dot kids-dot U.S. space, presumably there need to be some rules 
of the road for the providers that launch a web site in that 
area.
    And so in terms of where you have the liability protection, 
you probably do not want to protect from liability the 
companies that are establishing a web site who have committed 
to provide a child-friendly space. Would you want to provide 
some liability protection to the domain name operator who is 
enforcing the contract, but yet cannot control what the web 
site owner puts on their web site? you know, that may make 
sense.
    Mr. Shimkus. But can you do that without government 
involvement?
    Ms. Victory. Probably not.
    Mr. Shimkus. So then that--okay. So that answers the 
question of why it is important for maybe some legislation.
    Mr. Howe. I think the way that the bill has been written 
shows an understanding of the complex nature of what we are 
trying to do. And giving that helps us, because our enemies in 
the ICANN process, where thoughts such as ``one might object 
and sue sometimes.'' ICANN asked us to indemnify them against a 
lawsuit that may ever come to us to them, whereas the 
legislation from this committee, making a decision by a 
consensus body to say this is what we want to do, does help us 
as a registry operator not have to face the problem of one 
might do something, one might do something, or there might be 
some expectations that we would be shielded from. And the 
answer I would look forward to hearing as to whether that can 
be done, and leave it up to----
    Mr. Shimkus. Thank you, Mr. Chairman. And just for a yes or 
no answer from Mr. Howe, based upon what service you provide, 
do you allow chat rooms, instant messaging, cookies or banner 
ads on the service you provide right now?
    Mr. Howe. Cookies policy is unclear. We do not allow chat 
rooms. We have said to our registrants, to the extent that we 
can come with real-time monitoring and procedures that meet the 
needs that this committee and other people and bodies such as 
Ms. Hughes have suggested, we will then allow chat. But right 
now, there is no unmonitored chat on our dot----
    Mr. Shimkus. Instant messaging?
    Mr. Howe. We do not control the kids' access to other parts 
of what they do. Instant messaging is not always a domain 
issue. It happens on the browser. But right now we would not--a 
site that had unrestricted instant messaging as their goal we 
would say runs counter to what is kid-friendly.
    Mr. Shimkus. Thank you, Mr. Chairman. Thank you for 
allowing me to extend my time.
    Mr. Upton. Mr. Terry?
    Mr. Terry. Let me just follow up. I am kind of piqued--a 
more specific question that is in general discussion, and I 
think one of the ways is not only to protect kids from the 
content, but trying to receive or obtain information about 
families, and specifically kids. And so I appreciate the 
efforts that you have made to reduce the type of information 
obtained from kids, and I think that is extremely important.
    There are overt and covert ways to obtain information, 
though. Simply, you know, having to register when we put 
Disney's up, you know, the type of family information they are 
asking just to register to get to use their games was amazing 
to me. So I would like to reduce the type of information they 
obtain simply to access the games.
    But what I fear is not what I am overtly being asked, but 
what is covert in the way of cookies and other mechanisms out 
there to obtain that type of information of where you are 
going. Do you think we should go so far in this act to ban 
cookies? And I will ask Mr. Howe, and then Mr. Taylor and Ms. 
Hughes.
    Mr. Howe. I think, to date, the industry has tried to 
segment levels of cookies, tying of the information that you 
put in that allows them to do something with having that 
information and being able to potentially sell it, or what 
happens to that implementation after it goes. When we look at a 
site that comes up on .KIDS initially, we look at everything 
they do. And we try, and to the extent that we manage any dot 
kids or dog kids U.S., want to be just as start as they are. 
And we want to head-off those things that we see in practice 
right away, before they are able to have any success.
    I think there will always be cookie issues that seem to be 
able to operate within the bounds of what is kid-friendly. But 
again, to say all cookies are allowed opens up the process to 
be manipulated, in our opinion.
    Mr. Terry. Okay. Mr. Taylor, do you have input?
    Mr. Taylor. A little bit. I mean, cookies are a danger, and 
that was one of the focuses of Congress when they passed the 
Children's Internet Privacy Protection Act. I left out one of 
the initials in my paper, but a cookie that is given to you by 
the companies whose site you visit for the purposes of going 
onto that site at that time uses the information only to 
service your visit at that time and to keep that information 
private, so they do not sell it to other people, it does not 
get--and then if they do not follow you to the next site.
    There are different kinds of cookies--a cookie that if you 
visit Disney or CNET, and they give you their cookie and then 
they do not follow you when you close out and go someplace 
else, that is a different kind of cookie than the kinds that 
are capable of, when you sign off from MSN and you go to Yahoo 
and then you go to Disney, and that first cookie reports back 
to the mother ship that you went to all these other places. Now 
it knows that you go look at baseball and football, and maybe 
you looked at something your mom told you not to, and maybe you 
looked at something--whatever.
    So there are kinds of cookies that Congress should be 
concerned about on a dot kids domain that is something that the 
operator should be made aware of and has to monitor and report 
to Congress. I think you raise a good issue. The bad cookies 
should have to be restricted from this domain, even though you 
may not be able to stop it on----
    Mr. Markey. Would the gentleman yield briefly?
    Mr. Terry. Sure. I yield.
    Mr. Markey. In the Children's Online Privacy Act, it 
actually is made illegal for any site that gathers information 
about children to reuse that information for any other purpose 
other than that for which it was originally intended, without 
getting the explicit permission of the parents of those 
children. So under existing law, if it was used for any other 
purpose, then it would already be illegal, no matter what any 
of these sites might do now.
    Mr. Howe. The part of it we have attempted to do, and we 
have actually applied to some of the work the FTC is doing to 
educate more sites, because we do not see that reality as much 
as we think we should in the marketplace, the reality of that.
    The thing to answer you also is we do expect in our 
proposal for dot kids and the way we would run dot kids, 
advertising is a big part of it, and we hold our registrants 
accountable for the advertising that they allow on their site, 
and we would expect as dot kids develops that we would have 
technologies where you could only have dot kids-safe ads on 
this type of network.
    Ms. Hughes. I just wanted to add to that that, you know, I 
agree with what Mr. Taylor said, that you should restrict 
certain types of cookies, but to make the broader point, the 
reason that it is so important for Congress to have oversight 
to actually set the parameters of how this domain operates. 
Because it is not just cookies, it is again the monitoring 
features. There is monitoring. If somebody adds a link, like 
you saw about 25 percent of the links from kids' sites are to 
hardcore porn sites. You can catch that in real-time if you 
have the monitoring in place, and the same thing with 
filtering.
    So to just throw this over to somebody who has already got 
this monopoly and how they are going to run it however they 
want to run it, I think would be a very big problem. And to put 
this out to a bid process to where a company who could actually 
implement what you all have lined up would be very important, I 
think, and if that is not done, that we could again have a bit 
of a Trojan horse on our hands.
    Mr. Upton. Thank you.
    Mr. Cox?
    Mr. Cox. Thank you.
    Ms. Victory, I would like to attempt to begin by 
rehabilitating you. You have stated on page four of your 
testimony, I believe the quote is, ``I support the goal of the 
legislation.''
    Ms. Victory. Very much.
    Mr. Cox. So the administration and you support what this 
legislation is seeking to do. Is that correct?
    Ms. Victory. Very much so, yes.
    Mr. Cox. Okay. So we are not actually that far apart.
    Second, you have stated that, on page 5, that multiple 
governments have objected to this legislation. Can you tell me 
what governments we are talking about?
    Ms. Victory. My understanding is some members of the EU 
have objected.
    Mr. Cox. Do you know which ones?
    Ms. Victory. I will have to get back to you on that.
    Mr. Cox. Do you know any government that has objected?
    Ms. Victory. China, and Japan as well.
    Mr. Cox. China. Alright.
    Mr. Shimkus. If the gentleman would yield, I will just say 
as a sponsor, we have not heard from anybody as far as 
internationally that has been objecting to this.
    Ms. Victory. Well, here is the concern, and it is with the 
bill as originally dropped in, rather than the manager's 
amendment. If dot kids is a top-level domain, it is a global 
domain. And it is not one that is U.S.-centric, that is under 
U.S. auspices. It is a global domain. To the extent that the 
U.S. wants to impose certain policy restrictions on dot kids, 
there is nothing stopping the government of Japan, the 
government of the UK, the government of France, of Australia, 
from also going forward and doing that.
    Mr. Cox. None of this applies to dot U.S.
    Ms. Victory. It does not apply to dot U.S.
    Mr. Cox. And the managers amendment that we are looking at 
here has transcended that difficulty.
    Ms. Victory. That eliminates that concern. That is correct.
    Mr. Cox. So whatever problems we have, they are different 
than that one.
    Ms. Victory. Correct.
    Mr. Cox. Have the objections of any government that you are 
aware of extended to a domain within dot U.S.?
    Ms. Victory. No.
    Mr. Cox. So there are in fact no international objections 
that you are aware of.
    Ms. Victory. None that I am aware of. No.
    Mr. Cox. Okay. So we are making further progress.
    Mr. Markey. You are going to be so rehabilitated.
    Ms. Victory. Oh, well, thank you.
    Mr. Markey. You are going to out and be an honorary member 
of this committee.
    Mr. Cox. Well, in fact I think it is important to know that 
some of those principal objections that the department is 
advancing are in fact objections that we are taking cognizance 
of and that we are going to deal with here. We do not want to 
run over the international nature of the Internet and presume 
with the imposition of our own sovereign concerns to crowd out 
everyone else, the PRC included.
    I would add, however, I cannot say PRC and Internet in the 
same sentence without adding that it would be awfully nice if 
they would open up the intra-net that they maintain in their 
country to the rest of the world.
    Mr. Howe, I want to ask you, because you raise a 
fundamental point about the age of majority and the right to 
contract in this country, whether or not you think we can take 
advantage of the fact that we are dealing with kids under 13 
here, and impose some especially unique strictures on this base 
that would not fly anywhere else on the web, making it truly 
value-added.
    For example, it follows in the imagination, if not in 
logic, that we might want to prevent the collection of data 
from kids in this space. Is that something you would support?
    Mr. Howe. Yes.
    Mr. Cox. As a parent, I know it would make me feel good to 
know that when my kids are on the Internet they are not giving 
out their name and address to everybody that might ask for it. 
We have already a law that applies to the Internet at large, as 
you know, that requires parental consent. It is a sort of Rube 
Goldberg mechanism, and it is probably the best we can do on 
the Internet at large. But it seems to me we could take 
advantage of this opportunity to do a whole lot more, and then 
there would be some value-added.
    Likewise, I think you were suggesting or stating clearly 
that we ought not to have any opportunities for kids to 
contract for anything. And I think that would be useful--those 
both I think would be useful additions to the kinds of things 
we are talking about in this legislation.
    I am sorry. Would you like to add?
    Mr. Howe. I do not want to interrupt, but to the extent 
that as the operator we can take decisions that have already 
been made by consensus bodies such as the U.S. Congress, that 
have worked through the issues, received input and simply 
implement those, that is why the creation of dot kids allows 
the opportunity to do that, without the barriers of this might 
be something that is intended for something else.
    Mr. Cox. Now, the two of you, Ms. Victory and Mr. Howe, had 
some repartee going here about liability. And I am not sure I 
understood it and I am not sure I understand what respectively 
you think is advisable. But I note that in the managers 
amendment that is provision that, not quite word for word, but 
certainly from a policy standpoint, tracks exactly language 
that I wrote with Senator Wyden into the Internet Freedom and 
Family Empowerment Act--language that was upheld by the Supreme 
Court when the rest of CDA got struck down, that I think is the 
right way to go here.
    It seems to me that even, or especially if we are looking 
at this as a private sector function and we want the private 
sector and voluntary behavior to be dominant in these choices, 
that we have to carve out what is the role for government. And 
government's role, rather clearly, is describing liability. 
Private people cannot write our criminals laws for us. They 
cannot write our libel laws. All of that stuff is government. 
And so that is surely it seems to me an appropriate area for us 
to legislate in to augment and supplement what you are doing 
privately through agreement.
    And I wonder, Ms. Victory, if I misunderstood you, or 
whether you were in agreement with Mr. Howe or whether I 
misunderstood Mr. Howe. But what, if you wouldn't mind stating 
them more fully, are your respective positions about what 
Congress might do to circumscribe liability?
    Ms. Victory. Sure. I will try to be clear on this.
    I think if you are setting up a safe space for kids on the 
Internet, in order to try to figure out, well, where should 
liability protection fall and where should it not fall, clearly 
if you are opening a web site in that space, I think that the 
web site operator should be responsible for the content that it 
puts forth.
    Mr. Cox. And Mr. Howe, I think you agreed with that.
    Mr. Howe. Yes.
    Mr. Cox. Okay. So, so far, so good.
    Ms. Victory. But in terms of the manager of the domain, for 
example, you have to make a judgment as to whether or not it 
would be reasonable for the manager of the domain to be able to 
monitor all of the things that each web site owner puts on its 
web site. I think what the manager of the domain should be 
responsible for is setting forth standards that it would ask 
the web site owners who come into its domain to agree to. And 
as long as it is asking them to agree to those standards, I 
think that is about the most you can expect out of the domain 
name manager.
    I do not think that you can reasonably expect that they are 
able to monitor every communication on every web site within 
their domain. So to the extent there is liability protection, 
it probably appropriately falls to the domain name manager so 
long as they have a suitable contractual relationship with 
suitable standards for the space to begin with.
    Mr. Cox. It sounds to me, then, that you are comfortable 
with section 4 of the managers amendment the way it is written, 
or are you suggesting it be made even more broad?
    While we are waiting, Ms. Hughes?
    Ms. Hughes. Yes, I would agree with what she just said. 
However, I do think that as part of the language of this that 
the manager of this domain should implement monitoring 
technologies--not human monitors--monitoring technologies that 
can hold, that can tell if someone is not in compliance; if a 
web site operator is not in compliance. This technology is 
available in real-time. Also filtering technology is available 
that can catch things--changes or anything within the sites. 
Say, for instance, 100 pages down, there is something that is 
not in compliance.
    The web site owner should be the one that is liable, but to 
not have the technologies that are available and very 
inexpensive--not utilized by the web site manager I think would 
really be a disservice to the parents who are trusting this 
space to be a safe place for their children, because it is 
available and it is not expensive.
    Ms. Victory. And just to get back to you, yes, I think that 
those provisions are fine in setting forth that type of 
relationship. And just to go Ms. Hughes' comment, I think there 
are technologies that are available that it would be great to 
implement, but I think you would agree they are probably not 
100 percent fool-proof, or they would not cover every single 
type of communication or picture or paragraph that might appear 
on a web site. So again, to hold the domain name owner liable 
in case something slipped through the filtering technology 
probably would not be appropriate.
    Ms. Hughes. Well, I would agree that you should not hold 
the domain name manager liable, but the technology is quite 
sophisticated and does work in instant messaging, chat rooms, 
pictures and others. And so to utilize the technologies would 
again help make this space and guard against anyone who would 
not be adhering to the policies set forth by the manager.
    Mr. Howe. I think all the applicants using the technology 
would aspire to 99.91, 91.92, 91.93 percent. We could get 
better and better always at reducing what that leftover percent 
is that may come through, to the extent that the liability 
protection would help us for that more minute as we get better 
percents, yes, as an operator that would help us. And it would 
also--the sophistication of the bill to date, we really 
appreciate the work that the staffs from the committee have 
done, because it gets into these deep issues that are specific 
and have been the objections raised during the ICANN process.
    Of this, one might think, and to the extent that this 
legislation I can tell from, this means that it is so important 
that we are saying let's head them off at the pass. Let's head 
off the possible objections right now, because people want a 
solution right now.
    Mr. Cox. Mr. Chairman, I realize that time has long since 
expired, but I certainly did not want to interrupt the 
witnesses when they are complimenting the staff.
    I will just say that the conjunction of liability 
protections that we can offer legislatively and that we can 
offer uniquely legislatively with the benefits that a 
contractor might get under the dot U.S. domain might well 
provide the kind of quid pro quo for agreement that you are 
seeking, and make sure that we can go forward with this idea 
without breaking any china.
    Mr. Upton. Thank you for making that point.
    Mr. Cox. No pun intended.
    Mr. Upton. Did you say something good about China?
    Mr. Cox. I like China very much, just not their government.
    Mr. Upton. Mr. Largent?
    Mr. Largent. Thank you, Mr. Chairman.
    I just have a couple of questions of my concern of this 
effort, and Mr. Taylor I would like to address these to you.
    What happens if a porn company creates a web site at dot 
kids, dot U.S. or whatever it might be?
    Mr. Taylor. Well, they obviously could be prosecuted. 
Almost everything--I would say 95 percent of the pornography on 
hardcore triple-X dot com web sites is prosecutable as a felony 
under Federal law. I did it when I was at the Justice 
Department. They could have been doing it for the last 5 years. 
They could do it in the future, and they can do it under most 
State law. So they should be prosecuted.
    So the operators should have tip lines that kids and 
parents can complain about those sites that they have found 
that have got porn or they have links back to porn, so that the 
tips or the complaints or the snitching goes back to the 
operator and its goes to the FBI and it goes to local police. 
So those are the things that could be done.
    The operator should have the right--Congress can give the 
right of the operator and NTIA to withdraw or suspend or revoke 
the right of anybody to do business and list themselves on this 
domain if they do not obey the rules. And I think that is one 
of the things that Congress has to insist on is that you do not 
just hope somebody does a good job doing what you want dot kids 
to do. You have to give them the authority to throw out the 
people who do not want to put kid friendly and comply with the 
rules for this domain. If it is going to be created for that 
purpose, I think you have got to hold them to the agreement 
that says you are going to come on this domain with those 
conditions, and if you do not live up to them, we can throw you 
off.
    Mr. Largent. Let me see if I understand what you are 
saying. Does creating these particular safe havens for children 
to be online, does that create more incentive for the Justice 
Department to prosecute illegal obscenity online than not 
having it?
    Mr. Taylor. I think that it would be a more attractive 
prosecution if you found someone on the dot kids domain or 
linking to it or putting ads somewhere into the domain where 
they could get to the kids, because it would be a little harder 
for the FBI or the Justice Department to say, well, we do not 
want to do that case, even though they solicited kids or even 
though they showed hardcore porn to kids. They do not do a lot 
of those cases for the last 5 years, and the new attorney 
general has said he is going to begin enforcing the obscenity 
laws again. We trust that he is going to do that. We are going 
to try to help him do that.
    So I think there is more willingness to enforce existing 
Federal laws now than there has been in the past. But I also 
think that it is a crime that would be committed not only on 
the dot kids domain, but elsewhere. And if the government did 
prosecute more of the pornography syndicate people who put that 
pornography up on dot com and dot edu and dot mil and dot other 
places where it does not belong, we would not have so much of 
it to worry about on the dot kids. But we certainly should be 
able to police the dot kids domain much less controversially.
    Mr. Largent. Well, I guess my point is this, is that this 
has been an issue that I have been trying to lend voice to for 
many years in Congress. And the fact is that the Justice 
Department has not prosecuted what is out there today no matter 
where it is found. And my point is is that creating a dot kids 
domain that supposedly is safe for kids does not really ensure 
the fact that this would be safe.
    I mean, the fact is is that porn folks could put the same 
web sites that they are putting on the Internet today at 
whatever the domain is, and they could put it on this domain. 
And if the Justice Department does not show a willingness to 
prosecute at some point, all illegal pornography that is out 
there, and I agree with you, I think 95 percent of it is 
illegal today. It is not being prosecuted, with the small 
exception of some child pornography where there has been a 
limited effort on----
    Mr. Taylor. One of the things, Congressman, that you have 
done is keep the pressure on them to use the existing laws. One 
of the things that could be done if this domain is created, 
this bill passes, then maybe Congress, this committee could 
consider--drafting a law would have to go to Judiciary I know--
that would make it a crime for someone to distribute or display 
certain kinds of this pornography defined in this bill on the 
dot kids domain. Make it a separate crime that is tested 
separately.
    You also then could pass a provision in that bill that 
allows the states and encourages them to pass a similar law and 
allows them to keep any of the proceeds or forfeitures or fines 
that they collect. So that if a woman calls up and says my kid 
got this hardcore picture on a dot kids site, and the Justice 
Department did not take the case, she can go down to the local 
county prosecutor's and they can prosecute this web site, and 
then they could get that incentive to enforce the law.
    So it might end up being the need for cooperation between 
local and Federal prosecutors, because I think even with the 
best of intentions it is going to take a while for the Justice 
Department to get up to speed on this.
    Mr. Shimkus. Would the gentleman yield for 1 second?
    Mr. Largent. Sure.
    Mr. Shimkus. But the point that I want to add to this 
debate is that the registered operator can identify him and 
pull him down. That is the benefit of this bill is that the 
registry operator--you are on the prosecution side. I am trying 
to stop it as soon as it hits. And so they can identify, as we 
heard in the conversations, and maybe we need to beef that up, 
I do not know. And then the registry provider can pull that 
site off, so there is a positive aspect, too, and I appreciate 
the going after the----
    Mr. Largent. Sort of like the servers are supposed to pull 
off the pornography that is available----
    Mr. Shimkus. But it is more difficult to do when it is dot 
com. It is a commercial site. It is dot org. It is not defined 
as a kid-friendly site. So I think that that is what the 
constitutional issue is also that we are fighting.
    I yield back.
    Mr. Upton. This underscores that, as I understand it.
    Mr. Largent. Mr. Chairman, if I could just ask one other 
question, because this is also a concern that I have. Not that 
I am opposed to this, but the concern that I have is that could 
creation of a dot kids--Ms. Hughes, I would ask you this 
question--could the creation of this particular domain be seen 
as throwing in the white flag on the effort to prosecute 
illegal obscenity, or even weaken what little effort there is 
already in the prosecution of illegal obscenity?
    Ms. Hughes. I sure hope not. I do not know that it would 
weaken the prosecution. I really do not see how it would, to be 
quite----
    Mr. Largent. How it would is that just psychologically, 
even at a subconscious level, people would say, well, we have 
created this safe haven for children and so we do not need to 
really worry about this other stuff over here because we have 
got a place that is safe for kids.
    Ms. Hughes. Yes, that is right. Well, hopefully that would 
not occur, and again this has got to be a priority of the 
Justice Department. And we appreciate all the efforts that you 
have put forth over all these years. Because you are right, we 
have not had one obscenity prosecution that I know of on the 
Internet. And I would just like to draw your attention because 
the COPA Commission did not have the opportunity to come before 
Congress, but I have included in my report that one of our 
major recommendations to Congress, and maybe there is something 
that could be done here about this, is for Congress--I am just 
going to read exactly what we said--for government at all 
levels to fund with significant new money aggressive programs 
to investigate, prosecute and report violations of Federal and 
State obscenity law.
    And you know, it has not been done. It is not being done. 
Hopefully, we will see it being done in the future, but we need 
more money. And my concern is that, you know, the pornographers 
probably will try to tap into this market. Look, we know 25 
percent of them are deliberately targeting kids. Why wouldn't 
they go in and try to take advantage of this domain? I think 
that they probably would, and again we have got to have these 
laws enforced.
    Mr. Largent. Thank you.
    Thank you, Mr. Chairman.
    Mr. Upton. Thank you.
    We have three votes. I am going to ask one quick question 
and we will try to finish by the time we leave. And Mr. 
Shimkus, you might have one quick question, too.
    Ms. Victory, I just want to know, if NeuStar, for whatever 
reason, says we signed this contract; we have all these other 
things; our focus is going to be on dot parks and a variety of 
other things; we are not going to do it. Could anyone else--
anybody else--Mr. Howe's group or anybody else come back and 
say, we are here; we are going to it on our own; we are going 
to put up a dot kids, dot U.S., and there we go. Is there a 
group like Mr. Howe or somebody else--would they be prohibited 
from jumping in if NeuStar says it ain't going to be us? What 
is your read?
    Ms. Victory. My hope is that----
    Mr. Upton. I do not want your hope.
    Ms. Victory. Okay. My read is----
    Mr. Upton. They just say flat out sorry.
    Ms. Victory. Under dot kids-dot U.S., no. But as----
    Mr. Upton. You can't get in.
    Ms. Victory [continuing]. But as Mr. Hernand testified, his 
operation is looking at providing a dot kids space as well. So 
there may be other opportunities.
    Mr. Upton. I listened to Mr. Hernand's testimony. I happen 
to believe that it ought to be competitive out there. We ought 
to look at everybody waving their hand and see who has the best 
proposal and it ought to be made objectively and it ought to be 
under the parameters that we have established with this 
legislation with dot U.S., so we do not get China and all who 
else opposing it. But I am worried that if NeuStar says forget 
it, it ain't going to be us, it is not going to be anybody.
    Mr. Hernand. If I can just point out, not only are we 
proposing it, but it is something that we are already doing. It 
is something that 70 million Internet users today have access 
to and they are live. There are several thousand live dot kids 
web sites that are being used. So we hope that that will 
continue and that if the governmental efforts are not 
successful in making a dot kids, TLD or under dot U.S., that 
private enterprise will step up and continue to do what we are 
doing.
    Mr. Upton. Okay. Thank you.
    We are going to wrap up soon. Mr. Markey has got two 
questions. Mr. Shimkus has got one. We will finish.
    Mr. Markey?
    Mr. Markey. Two quick questions for Secretary Victory. In 
your view, is the situation currently with NeuStar one where 
NTIA has a final contract with NeuStar? Or have you simply 
accepted NeuStar's proposal with contract details still to be 
worked out and finalized?
    Ms. Victory. I believe it is a final contract. However, 
there is oversight from NTIA and we do have the ability to 
direct them to do certain things. I would have to go back and 
see if we specifically have the authority to direct them to 
provide immediately a dot kids-dot U.S. sub-level domain. I do 
not think we have the authority to direct them specifically as 
to what the standard should be or exactly how they are going to 
do that. But we do have the opportunity through the contract to 
provide certain direction.
    Mr. Markey. Could you send us the contract?
    Ms. Victory. I would be happy to.
    Mr. Markey. And finally, in the post-September 11 
environment, has NTIA thought further about the security 
implications of American control over key assets of the 
Internet infrastructure? Is relinquishing further control of 
root servers to ICANN in the national security interests of the 
United States in your view?
    Ms. Victory. Certainly after September 11 and even before, 
we were very focused on the security of the root servers. There 
were a number of steps taken in the wake of September 11 to 
make them more secure, and I know ICANN is devoting its 
November board meeting to security issues, focusing on that. 
But yes, this is something that we are very much aware of.
    Mr. Markey. What is the Department of Commerce doing in 
terms of their request to ICANN to ensure that there is a 
higher level of security?
    Ms. Victory. The Department of Commerce will be at the 
ICANN board meeting in November, and in fact I believe that we 
are going to be sending some members of the administration who 
are focused on the homeland security effort to provide 
information and also to answer questions for the ICANN board.
    Mr. Markey. Have you asked them to do anything specific 
since September 11? Has Commerce asked ICANN to do anything 
specific since September 11 to enhance the security?
    Ms. Victory. We have not asked them to do anything 
specific, although we have been working with VeriSign who has 
the contract for the root server. They have taken a number of 
specific steps, and we had requested prior to September 11 for 
them to do a study as to the security of the root server.
    Mr. Markey. Should NTIA relinquish control of the root 
server, in your opinion?
    Ms. Victory. At this time, we have not made any decisions 
in that regard.
    Mr. Markey. I do not think you should relinquish control of 
the root server.
    Mr. Upton. We may have a hearing on that.
    Mr. Markey. Thank you, Mr. Chairman.
    Mr. Upton. Mr. Shimkus?
    Mr. Shimkus. Thank you, Mr. Chairman, and I will be quick.
    We did not really talk very much today about transparency 
and due process issues on applications to ICANN. That was a big 
beef. I would encourage those of you at the panel to look 
through the legislation. We did not change a lot of the 
transparency provisions and the due process provisions, and 
especially those who have tried to break through the doors of 
ICANN, I encourage your look.
    And I ask, Mr. Hernand, I appreciate your being here. I am 
sorry we did not get a lot of questions. Let me ask one 
question to you, though, about should the dot U.S., the second-
level domains within dot U.S., should they be competitively 
bid?
    Mr. Hernand. I think that they should definitely be 
competitively bid. When you talk about creating a kid-friendly 
environment, you want a company selected as the operator that 
is passionate about these issues; that has a history of working 
in these issue. And I am sure that NeuStar could do a great job 
technologically in running a registry, but there is more than 
just the technical implementation involved here. And I would 
encourage, if we go down this route, that you open up the 
process and create a sub-registry within what NeuStar is 
running.
    Mr. Shimkus. Do you all know what we have to do to 
encourage that legislatively? Mr. Howe? I now it is two, but it 
is a follow-up. We have plenty of time.
    Mr. Howe. I know we spoke as if the NeuStar-U.S. agreement 
is final, and am also not a lawyer, but I know the rest of the 
country codes that exist with ICANN are in a process of signing 
agreements with ICANN called the ccTLD agreements. I would 
expect that the U.S. operator and the Department of Commerce 
are going to be in a situation where they are having to sign an 
agreement with ICANN talking about how to operate the dot U.S.
    And to the extent that we are saying that some changes may 
come from that process, it seems to me as an outsider that 
there should be some idea that there might be changes to that 
contract, and what is done now cannot really be the final one 
because it still needs to undergo this ICANN hurdle. And if it 
needs to have the U.S. Government negotiating with ICANN, it 
seems like we should open it up for some other possible 
changes.
    Mr. Shimkus. Thank you, Mr. Chairman. I yield back.
    Mr. Upton. Thank you.
    Again, I want to thank all of you. I am sorry we have these 
votes and we are running out of her very quickly. Thank you for 
your testimony and for your answers. We look forward to working 
with you as this legislation moves down the pike.
    Thank you.
    [Whereupon, at 12:30 p.m., the subcommittee was adjourned.]

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