The proceedings were opened by Dr Willie Black, managing director of Nominet UK. For the benefit of newer members Dr Black gave a brief history of the Domain Name System before going on to look at the development of Nominet. Particular consideration was given to the reasons why the organisation was set up as a not-for-profit company, limited by guarantee:

• to demonstrate its public service ethos
  
  
• to give it a legitimacy within the industry
  
  
• to ensure that the price of Domain Name registration is kept to a minimum
  
  
• to allow members to benefit by competing
  
  
• to reassure government that Nominet's natural monopoly position would not be abused
  
  

Operations Director, Lesley Cowley, outlined her responsibilities and presented the results of the recent operations review. Key findings included a positive assessment of the morale and capability of the staff, opportunities for further automation, the need to improve customer responsiveness and the need for action to deal with the pressures of growth. Members of Nominet were invited to contact Lesley with their comments and suggestions.

New Domain Name registrations showed a growth of more than 150% over the year, with 23 000 new registrations in June 1999. Renewals were currently 2700 per month and this was expected to increase in line with the original growth curve.The membership of Nominet had also increased by 485 and now totalled over 1000. While 50% of members register no more than one Domain Name each month, 20 members register more than 100.

Alex Bligh, a non-executive director of Nominet UK, presented a detailed financial report based on both historic data and an income and expenditure forecast for the next three years. These showed that the growth in Domain Name registration had led to an increase in staff and operating costs but legal costs were reducing as experience was gained in dealing with disputes.

The potential conflict was highlighted between on the one hand maintaining long-term profit and loss neutrality and on the other ensuring that Nominet had sufficient reserves to meet its operating liabilities and to maintain its legal defence fund.

The Policy Advisory Board (PAB) had proposed a fee reduction to £5 for members. The Council of Management decided to adopt the recommendation and it was put to a ballot of members (see below).

• Although many believed that there was still room for growth in the .co.uk Second Level Domain, others were concerned about potential overcrowding. The PAB had been asked to look at defining criteria for the creation of new Second Level Domains but this would not be easy; trademark holders in particular would be concerned to ensure that the problems of ‘cybersquatting’ should be minimised.
  
  
• Statistics on renewals were slow to come through because of the time taken to contact a Registrant before suspending a Domain Name for non-payment. However, it appeared that approximately 75% of registrations were being renewed.
  
  No definite timescale could be given for when a Domain Name would be made available for registration following suspension. It was explained that after the invoice period, Nominet issues one reminder with a further month to pay and then suspends the registration for approximately 6 weeks before cancelling it.
  
  
• Requests for Domain Name registration for schools could still be accepted by members, but BECTa would shortly be mailing all schools to outline the new arrangements.
  
  
• The assumptions in the financial forecasts were questioned, both in terms of whether growth would continue at the current rate and also whether Domain Name registration was price sensitive. There was widespread agreement that the speed of growth was impossible to predict accurately but that growth would continue.
  
  
• Concern was expressed that the membership of Nominet was too open and could potentially allow in those with ulterior motives. However, it was pointed out that any increase in membership fees would create a barrier to entry, particularly for smaller businesses, without preventing those determined to become members. Certain safeguards had been built into the Memorandum and Articles of Association and the weighted voting system would help existing members to outvote any ‘carpetbaggers’.
  
  Reference was also made to the role of government, the Department of Trade and Industry and the European Commission competition authorities, all of whom were concerned to ensure that Nominet's natural monopoly position was not abused.
  
  
• The question of webcasting the AGM for the benefit of those unable to attend was raised and it was agreed that it should be considered for next year.
  
  
• Members were encouraged to make their views known on these and any other issues to the Council of Management and the Policy Advisory Board.
  
  

• The 1997/8 audited accounts were accepted unanimously.
  
  
• The current auditors, Wenn Townsend, were re-appointed by a majority vote.
  
  
• As Chair of the meeting, Dr Black called a poll of members to elect two non-executive directors. He explained that the poll result would be declared the following day and confirmed the appointment of the Electoral Reform Ballot Company as scrutineers of the poll and of the subsequent count at Nominet's offices (see below).
  
  

Chair of the PAB, Richard Almeida, outlined its role and reported on progress todate:

• A proposal to reduce the Domain Name registration fee paid by members had been referred to the Council of Management and put to a vote of the Nominet membership.
  
  
• Working parties were considering a revision of the current rules and the creation of criteria under which new Second Level Domains might be introduced.
  
  
• The Tag Holder Contract was being reviewed.
  
  
• A briefing paper was being prepared on ‘lame delegations’
  
  
• PAB members had agreed in principle on how to deal with pre-Nominet registrations.
  
  

• CommerceNet

  Neil Ellul, managing director of the Commerce Net Consortium Ltd, outlined the organisation's goals and services. Specific projects highlighted include: testbeds for e-commerce applications, smartcard interoperability, the Internet marketing project and research into barriers to e-commerce.
  
  

• ISP Liability

  Manuel Barca, the barrister defending Demon in the ‘Godfrey’ case, outlined the legal situation in both the UK and the USA. While the latter had introduced a federal immunity for ISPs caught up in the distribution of defamatory material by a third party through their servers, English law was not so clear.
  
  The 1996 Defamation Act had created a new defence of ‘innocent dissemination’ but the Demon case demonstrated that once notified, the ISP would be expected to act quickly to remove the defamatory material. This presentation was followed by a lively discussion about ISP liability, particularly with regards to content.
  
  

The poll count for the election of two non-executive directors to the Council of Management was concluded on the 21st July 1999, at the Nominet offices in Oxford. The results are that Rob Blokzijl and Ivan Pope were re-elected.

The poll was conducted using the Single Transferable Vote (STV) system, according to the procedure outlined by Nominet on 16th July 1999. The STV process was carried out using software designed by Clive Feather, and this year was scrutinised by the Electoral Reform Ballot Services Company.

The official results table, as approved by the Electoral Reform Ballot Services Company, appears below. As you will see from the table, Rob Blokzijl was elected at the first stage, and Ivan Pope was elected after a fraction of the surplus vote had been re-allocated in the second round.

Candidates	First Stage	Second Stage Surplus of BLOKZIJL @ 0.406
BLOKZIJL Elected 1st	679.000	-276.000	403.000
CRANE	31.000	12.194	43.194
FEIGEN	21.000	0.406	21.406
FOX	64.000		64.000
MISZTI	22.000	23.575	45.575
POPE Elected 2nd	385.000	235.758	620.758
WEBBER	4.000		4.000
Non-distributable remainder of surpluses		4.067	4.067
Non-transferable (preferences exhausted)
TOTAL	1206.000		1206.000

The ballot to change the Domain Name registration fee to GBP 5 for members and GBP 80 for non-members has been concluded, and the proposal has been passed.

Nominet received 189 valid returns (ten papers were invalid as they were either spoilt or received late). Of the total valid votes, 88 percent were cast in favour of the proposal to change the fee, and 12 percent of members voted against the motion. It is intended to implement the new charging structure from 1st September 1999.

The Nominet Policy Advisory Board has agreed to discuss the fee structure on a regular basis at its meetings, and will review financial forecasts again in six months time.