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Governments to reveal new gTLD objection shortlist next week

Kevin Murphy, February 15, 2013, Domain Policy

ICANN’s Governmental Advisory Committee will next week reveal its shortlist of new gTLD applications that face possible death-by-government.

A brief notice posted to the GAC web site yesterday said:

During the week of February 18th, 2013, the GAC will post its list of applications for consideration by the GAC as a whole in Beijing, in the context of developing GAC advice as outlined in the Applicant Guidebook (Module 3 section 3.1).

This appears to mean that the GAC has been doing a lot of preparatory work to get the list of 1,916 remaining new gTLD applications down to a more manageable number.

ICANN is expecting to receive GAC Advice on New gTLDs, as defined in the Applicant Guidebook, not too long after its Beijing public meeting closes on April 11.

As reported earlier today, ICANN expects to start approving new gTLDs April 23. It’s not going to do this before it’s received the GAC’s go-ahead.

GAC Advice could take the form of a consensus recommendation to ICANN to kill off one or more new gTLD bids, or non-consensus “concerns” that would be less deadly to applicants.

GAC members have already issued 242 Early Warnings, which were designed to give applicants the opportunity to change their plans or withdraw before receiving full GAC Advice.

No doubt some of the companies in receipt of Early Warnings will have done enough in the interim to put governments’ minds at rest, but there’s also nothing stopping the GAC adding new applications to its hit-list.

The European Commission and Iran both submitted lists of concerns outside of the official Early Warning process, and there’s been no official word from the GAC yet as to what status they have.

With that in mind, it’s difficult to predict how many applications, and which ones, are going to be on the GAC’s new shortlist.

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Chehade names the date: ICANN to approve first new gTLDs on April 23

Kevin Murphy, February 15, 2013, Domain Policy

ICANN expects to approve the first new gTLDs on April 23, just 68 days from now.

The long-awaited date, which of course comes with certain caveats, was revealed by CEO Fadi Chehade in a video interview with ICANN media affairs chief Brad White today.

Chehade said:

We are now targeting to be able to recommend for delegation the first new gTLD as early as the 23rd of April, and I can say this because we have made great progress in the last few weeks in aligning all the necessary pieces that would permit us to recommend a delegation as early as the 23rd of April.

Having said that, I want to be very clear there are some things that we can’t control that may cause this date to slip, but even in that case we are looking for a slippage of days or weeks, not months anymore. So we are definitely now with clear visibility on a set of processes that allow us to hit the first recommended delegation as early as the 23rd of April.

The news is surprising; those following the new gTLD program closely are more accustomed to hearing announcements about delays.

Chehade’s recent comments at a meeting of registries and registrars in Amsterdam, in which he said his personal preference would be to delay the whole new gTLD program by a year, did not suggest the imminent announcement of so ambitious a deadline.

He addresses those comments in the interview.

The news strongly suggests that ICANN’s Governmental Advisory Committee — arguably the biggest unknown quantity at this point in the process — is on target to submit its formal Advice on New gTLDs not too long after the ICANN public meeting in Beijing, which ends April 11.

I would have put money on that not happening.

The date also suggests that ICANN is unlikely to extend the window for filing objections against applications, currently closing March 13, despite the very tight deadline this will create for potential objectors.

Because the results of the String Similarity Panel’s deliberations — which will very likely create new contention sets — will not be published until March 1, many organizations will only get seven or eight working days to finalize and submit their strategic objections.

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Architelos runs new gTLD market readiness survey

Kevin Murphy, February 13, 2013, Domain Services

New gTLD consultancy/software provider Architelos is carrying out a survey of new gTLD applicants in an effort to gauge how ready they are to launch.

The company is of the view that many applicants are under-prepared for the amount of work coming down the pike when they finally pass through ICANN’s long-running evaluation process.

The five-minute Q&A covers areas such as financial planning, compliance, hiring and launch marketing.

It’s also a way for Architelos to prospect for potential customers, though responses can be anonymous if desired.

If you’re an applicant, you can participate in the survey here.

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Mystery gTLD applicant to take Google fight to lawmakers

Kevin Murphy, February 13, 2013, Domain Policy

An as-yet unidentified new gTLD applicant plans to lobby Washington DC and Brussels hard to get dozens of Google’s new gTLD bids thrown out of ICANN on competition grounds.

Phil Corwin of the law firm Virtuallaw, who is representing this applicant, told DI yesterday that his client believes Google plans to use new gTLDs to choke off competition in the web search market.

“They’re trying to use the TLD program to enhance their own dominance and exclude potential competitors,” Corwin said. “We think this should be looked at now because once these TLDs are delegated the delegations are basically forever.”

He’s planning to take these concerns to “policy makers and regulators” in the US and Europe, in a concerted campaign likely to kick off towards the end of the month (his client’s identity will be revealed at that time, he assured us).

Corwin’s client — which is in at least one contention set with Google, though in none with Amazon — reckons ICANN’s new gTLD program is ill-suited to pick the best candidate to run a gTLD.

If objections to new gTLD applications fail, the last-resort method for deciding the winner of a contention set is auction. Google obviously has the resources to win any auction it finds itself in.

“On any TLD Google has applied for, nobody can beat them,” said Corwin. “They have $50bn cash, plus the value of their stock. If they want any of the TLDs they’ve applied for, they get them.”

“A string contention process that relies solely on an auction clearly favors the deep-pocketed,” he said.

Google applied for 101 new gTLDs, 98 of which remain in play today. A small handful of the strings are dot-brands (such as .youtube and .google), with the majority comprising dictionary words and abbreviations.

Some of its generic bids propose open business models, while others would have “closed” or single-registrant business models. As we reported on Friday, this has kicked off a firestorm in the ICANN community.

Corwin said that Google appears to be planning to close off not only individual TLDs, but entire categories of TLDs.

For example, Google has applied for .youtube as a brand, but it’s also applied for .film, .movie, .mov, .live, .show and .tube with a variety of proposed business models.

“You can pretty well bet that they’ll exclude those that will pose a competitive threat to YouTube,” Corwin said.

Search will become much more important after the launch of hundreds of new gTLDs, Corwin reckons, as consumers are “not going to know that most of them exist”.

“Generic words are the perfect platform for constructing vertical search engines that can compete against Google’s general search engine,” Corwin said.

“Google is trying to buy up not just one but multiple terms that cover the same goods and services in key areas of internet commerce, and in effect control them so competition cannot arise and challenge Google’s dominance as a search engine,” he said.

Google has not yet revealed in any meaningful way how its search engine will handle new gTLDs.

The US Federal Trade Commission, at the conclusion of an antitrust investigation, recently gave Google a pass for its practice of prominently displaying results from its own services on results pages.

With that in mind, if Google were to win its contention set for .movie, but not for .film, is it possible that .movie would get a competitive advantage from preferential treatment in search?

Corwin reckons that Google anti-competitive intentions are already suggested by its strategy in ICANN’s new gTLD prioritization draw, which took place in December.

Of the roughly 150 applications for which Draw tickets were not purchased, Google is behind 24 of them — including .movie, .music, .tube and .search — 22 of which are in contention sets.

As a result, these contention sets have all been shunted to the back of ICANN’s application processing queue, adding many months to time-to-market and costing rival, less-well-funded applicants a lot of money in ongoing overheads.

“We see Google playing a rather different game here to most other applicants in terms of their motivation, which is not to enter the market but to protect their market dominance,” Corwin said.

Corwin said the game plan is to taken all these concerns to policy makers and regulators in the US and Europe in order to get governments on-side, both inside and outside of the ICANN process.

Corwin is also counsel and front-man for domainer group the Internet Commerce Association, but he said that the new anti-Google drive is unrelated to his work for ICA.

So why is his client only bringing up the issue now? After all, we’ve all known about the contents of every new gTLD application since last June.

My hunch is that Google is playing hard-ball behind the scenes in settlement talks with contention set rivals.

Contention sets can be resolved only when all but one of the applicants drops out, either following an ICANN auction or private buy-outs. Most applicants favor private resolution because it offers them the chance to recoup some, all, or more than the money they splashed out on applying.

That game plan probably does not apply to Google, of course, which is not wanting of funds. The company may even have good reason to prefer ICANN auctions, in order to to discourage those who would apply for new gTLDs in future just in order to put their hands in Google’s pockets.

The topic of closed generics and competition is likely to be a hot-button topic at ICANN’s next public meeting, coming up in Beijing this April.

Members of ICANN’s Governmental Advisory Committee have already expressed some concerns about many “closed gTLD” applications made by Google, Amazon and others.

ICANN’s board of directors is currently mulling over what to do about the issue, and has thrown it open to public comment for your feedback.

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ICANN seeks more power over new gTLD registries

Kevin Murphy, February 12, 2013, Domain Registries

When ICANN published a new draft of its basic Registry Agreement for wannabe new gTLD operators last week, much of the focus was on the new Public Interest Commitments mechanism, but a whole bunch of other big changes were also proposed.

ICANN has floated some quite significant amendments that would give it greater powers to approve mergers and acquisitions and more or less unilaterally change registries’ contracts in future.

Here’s my take on the biggest changes.

Regulating M&A activity

When a new gTLD registry business is acquired, ICANN wants to have greater rights to approve the transaction.

Changes to Section 7.5 would enable ICANN to check that the buyer and its ultimate parent company “meets the ICANN-adopted specification or policy on registry operator criteria then in effect”.

That would specifically include fresh background checks on the acquirer and its parent company.

For new gTLD applicants planning to flip their gTLDs in future, it means the buyers would be subject to the same scrutiny as the applicants themselves are today.

But — and it could turn out to be a big but — these checks would not be carried out if the registry’s buyer was already itself a compliant, ICANN-contracted gTLD registry.

In other words, it is going to be much easier for gTLD registries to acquire each other than it will be for outsiders to acquire them.

Had the rules been in place before now they would have complicated, for example, the acquisition of .pro by Hostway (not already a registry), but not its subsequent acquisition by Afilias (which already had .info).

Powers to change the contract

ICANN wants to grant itself the ability to make “Special Amendments” to all gTLD registry agreements in future without the consent of the registries.

Under the current version of the Registry Agreement, such amendments would need the approval of registries representing two-thirds of all registry fees paid to ICANN before they became law.

(It’s possible that this would give Verisign, as .com/.net registry, a de facto veto due to its market share).

But ICANN wants to change this rule to give its own board of directors the ability to impose amendments to the contract on registries, even if the registries vote against them.

The board would need a supermajority vote (66%, which pretty much every board vote receives anyway) and would need to be “justified by a substantial and compelling need”, quite a subjective threshold, in order to ignore the registries’ protests.

Special Amendments could not cover basic things like pricing or the definition of “registry services”.

ICANN, no doubt bruised by 18 months of laborious Registrar Accreditation Agreement renegotiations, says the change is “of fundamental importance and deserves careful attention given the long-term nature of registry agreements”.

But ICANN contracted parties are usually pretty reluctant to give ICANN more powers over their businesses, especially when it comes to sacrificing their right to renegotiate their contracts, so I can’t see these proposed changes to the Registry Agreement being accepted without hot debate.

Reserved Names

Section 2 of the agreement has been tweaked to make it a bit clearer under what circumstances registries are able to register names for their own use, or block them, and when they have to pay ICANN fees to do so.

The new language makes it clear that registries will not have to pay ICANN fees, and won’t have to use accredited registrars, for domains that are completely blocked from registration and are not used by the registry or anyone else.

By my reading, this could cover the kind of defensive blocking services that many applicants plan to offer to trademark owners, and other anti-abuse mechanisms, but not domains that registries plans to “reserve” for their own use.

At first glance, this might be seen as something that primarily affects dot-brands (which own all the second-level domains in their gTLDs) but most will probably be protected by the 50,000-domain threshold that must be passed before per-domain ICANN fees kick in.

Names that are held back for the registry to use would still have to be registered through a registrar and would incur ICANN fees, with a handful of named exceptions (nic.tld, www.tld, etc).

The new Registry Agreement also includes the final list of strings related to the Red Cross and International Olympic Committee that need to be reserved at the second level, along with a placeholder for reservations of strings related to other intergovernmental organizations.

Other stuff

There are quite a lot of proposed changes (pdf) to the agreement, which are currently open for public comment, and it’s possible I may have missed something equally important as the above.

I’m wondering, for example, about the possible impact of the changes to Specification 7 that seem to make registries responsible if their registrars do not uphold intellectual property rights protection mechanisms.

Also, do the changes to Spec 4 suggest that ICANN plans to outsource the job of Centralized Zone Data Access Provider? What’s the impact on applicants of the changes to Continuing Operations Instrument?

What have you spotted?

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