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Half the industry fighting over EBERO contracts

Kevin Murphy, December 15, 2011, Domain Registries

ICANN received a whopping 14 responses to its recent request for emergency back-end registry operators, contracts that could turn lucrative if and when new gTLDs start going out of business.

Following a request for information last month, responses received before the December 5 deadline came from Europe, Asia and North and South America, ICANN’s Karla Valente blogged.

While 14 may not seem like a lot, I’m only aware of 19 companies that are actively marketing new gTLD back-end registry services, so it’s a pretty high response rate.

The EBERO’s job is to make sure domain names continue to work after a new gTLD registry goes out of business. In the worst case scenario, it keeps the names resolving for up to three years, giving registrants the opportunity to migrate to another TLD.

The EBERO may, and I’m speculating here, also have an advantage in talks to take over the failed TLD full-time.

The successful providers will be paid from the Continuing Operations Instrument, a big chunk of cash that all new gTLD applicants are obliged to put aside to pay for their own funeral costs.

The price the successful EBEROs intend to charge is an important consideration when applicants calculate the size of their own COI, but those numbers have not yet been revealed.

The EBERO idea has come in for a bit of criticism due to ICANN’s high technical demands – 25,000 concurrent connections for an essentially stagnant TLD, for example – which some say favors incumbent registry operators such as VeriSign, Afilias and Neustar.

ICANN may wind up selecting more than one EBERO when it makes its decision early next year.

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IGOs plead for special new gTLD protections

Kevin Murphy, December 15, 2011, Domain Policy

Twenty-eight intergovernmental organizations, including the UN, ITU and WIPO, have asked ICANN for special protection for their acronyms in the new top-level domains program.

A letter sent to ICANN earlier this week and obtained by DI, reads:

we formally request ICANN to make provision for a targeted exclusion of third party registrations of the names and acronyms of IGOs both at the top and second level, at least during ICANN’s first application round and until further appropriate policy could be developed.

It goes on to claim that fighting abusive domain registrations and enforcing rights diverts funds from causes such as famine relief, scientific research and children’s rights.

For the sake of brevity, this is the list of the letter’s signatories in acronym form only: AfDB, EBRD, ESO, CERN, ESA, IADB, IAEA, IFAD, ILO, IMO, IMF, IOM, ITU, NIB, NATO, OECD, OPCW, UN, UNESCO, UNIDO, UPU, WB, WHO, WIPO, WMO, UNWTO, and WTO.

The letter justifies its request by citing the rights given to IGO names under the Paris Convention for the Protection of Industrial Property.

It’s a pretty flimsy argument. The Paris convention does not give IGOs exclusive rights to strings. It may protect the World Bank abbreviation WB, for example, but not to the extent that Warner Brothers can’t also use it to market movies.

The letter also cites ICANN’s Governmental Advisory Committee, which called for IGOs to be protected in its March 2007 GAC Principles regarding New gTLDs advice.

The Principles, however, talk about IGOs in the same breath as regular trademark owners, which is exactly how the new gTLD Applicant Guidebook treats them today.

There is some ICANN precedent for giving in to this kind of special pleading, however.

The latest Guidebook makes several dozen trademarks relating to the Red Cross, Red Crescent and Olympic movements “ineligible for delegation” as gTLDs, but offers them no second-level protection.

It was noted at the time the decision was made – at the behest of the GAC – that giving the Olympics special treatment would create a slippery slope to a full-blown Globally Protected Marks List, a concept ICANN has already rejected.

The UN et al only really have a shot at getting what they want if they can get the GAC on side, and several influential GAC members have already stated that the Olympic/Red Cross case was unique.

I think the response from ICANN will be a letter from president Rod Beckstrom politely declining the request and inviting its signatories to participate in the ICANN community.

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ICM opens can of worms with .xxx domain seizures

Kevin Murphy, December 14, 2011, Domain Registries

ICM Registry has suspended several dozen .xxx domain names registered by cybersquatters.

It’s believed to be unprecedented for a mainstream registry to unilaterally shut down domains purely on the grounds of alleged cybersquatting, as I reported for The Register earlier today.

ICM took down 70 to 80 domains including washingtonpost.xxx, cnbc.xxx and verizonwireless.xxx because it decided that the domains infringed trademarks and were therefore abusive.

Many belonged to the squatter Domain Name Wire first fingered as the registrant of huffingtonpost.xxx, named in Whois as Justin Crews.

Crews had told MSNBC that he planned to sell the domains at profit.

There was no UDRP arbitration, no court order, just a breach of the .xxx registry-registrant agreement, which gives ICM the right to suspend squatted domains at will.

This is the relevant part of the agreement, which all .xxx registrants must agree to:

You acknowledge and agree that the Registry reserves the right to disqualify you or your agents from making or maintaining any Registrations or Reservations in the .XXX TLD if you are found to have repeatedly engaged in abusive registrations, in its sole discretion.

I blogged back in May about why it might not be necessary to spend a fortune on defensive registrations in .xxx, given the existence of this policy and others.

Nevertheless, while it may take a while for the implications to become clear, I think the suspensions represent a very significant development.

Coming so soon after the end of ICM’s sunrise period, which saw many organizations spend thousands on useless non-resolving defensive registrations, I wouldn’t be surprised if many companies feel like they may have wasted their money.

If you’ve just spent $200 defending your brand, I imagine it would be quite annoying to see the likes of verizonwireless.xxx or businessweek.xxx get the same protection for free.

I would also not be surprised if, from now on, trademark attorneys trying to defend their rights in .xxx first contacted ICM, rather than WIPO or the National Arbitration Forum.

Why spend thousands on a UDRP complaint when you can just send a legal nastygram to ICM?

ICM president Stuart Lawley told DI today that this wave of suspensions was done independently, not in response to any legal demands.

Still, the precedent has been set: ICM will suspend domains for free, under certain circumstances.

What those circumstances are is less clear.

Lawley said that ICM will not get involved in complaints about individual domains – but it will shut down cybersquatters with multiple infringements.

But what constitutes cybersquatting? UDRP has a definition, but I’m not sure ICM does. It may be quite subjective.

It’s also not clear what ICM will do with the suspended domains, not all of which necessarily infringe trademarks. Some may be bona fide, but the ICM policy is to take down the registrant’s entire portfolio.

So will those non-infringing domains be released back into the pool? And if so, how will ICM determine which are squats and which are not?

And what about the ones that are squats? Will they be released?

AOL may be content for huffingtonpost.xxx to remain suspended forever. As long as it’s suspended, the company does not have to worry about defensive registration fees.

But consider gayroom.xxx, which was also suspended.

The owner of gayroom.com owns a trademark on the word “gayroom”. Gayroom.com is a porn site, but one that has chosen not to buy its equivalent .xxx domain.

What if it changes its mind? If gayroom.com wants gayroom.xxx in future, is there a way to take it out of suspension, or is the company stuck without its .xxx forever, just because a cybersquatter got there first?

ICM’s policies do not seem to answer this question and the company has not yet revealed its plans for the suspended domains.

As a post-script, I should note that Huffington Post owner AOL is currently listed as the registrant of huffingtonpost.xxx in the Whois record.

It’s not yet clear why this is the case, but Lawley stated unequivocally today that the apparent transfer is completely unrelated to ICM’s own crackdown.

Go Daddy, the registrar of record for the domain, declined to comment, citing its customer privacy policy.

Did the cybersquatter transfer the domain to AOL before the suspension? Did he sell it to AOL? Or did he just update the Whois with phoney data? Either seems possible at this point.

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Congressmen ask for new gTLDs delay

Kevin Murphy, December 14, 2011, Domain Policy

ICANN should consider delaying the launch of its new top-level domains program, a number of US lawmakers said at a House of Representatives committee hearing today.

If the Senate’s hearing on new gTLDs last week could be characterized as a “win” for ICANN, today’s House meeting probably went in favor of its adversaries in the Association of National Advertisers.

“I don’t think it’s ready for prime time,” Rep. Anna Eshoo said during the Energy & Commerce Committee hearing. “I suggest that it is delayed until consensus is developed among relevant stakeholders.”

That’s exactly what the ANA and the Coalition for Responsible Internet Domain Oversight wanted to hear, and her views were echoed by several other Congresspeople, using similar language.

ICANN’s senior vice president Kurt Pritz, who was put forward to defend the new gTLD program in Washington DC for the second consecutive week, disagreed.

“This process has not been rushed, it’s been seven years in the making,” he said. “All the issues have been discussed and no new issues have been raised.”

National Telecommunications and Information Administration associate administrator Fiona Alexander, there to defend the ICANN process if not its results, observed that “consensus” does not necessarily always mean “unanimity”.

The hearing also heard from Josh Bourne of the Coalition Against Domain Name Abuse, a long-time critic of ICANN and new gTLDs.

CADNA has recently taken a more pragmatic view of the program, coinciding with sister group Fairwinds Partners’ decision to emerge as a new gTLD consultancy.

Bourne therefore found himself not only defending the program but also praising .xxx, saying that its novel trademark protection mechanisms should be mandatory in new gTLDs.

CADNA’s main demand nowadays is for clarity into the dates of subsequent application rounds, which Bourne said would relieve the “condition of scarcity” that the uncertainty has created.

Bourne also said that Congress could fight fraud by revising the the 12-year-old US Anticybersquatting Consumer Protection Act.

Also on the panel as an opponent of the program was Anjali Hansen, an IP attorney with the Better Business Bureau, who came to complain about the cost of defending the “BBB” trademark.

Hansen’s testimony was essentially worthless. When she was not complaining about fraudsters infringing copyright on BBB’s logo (obviously irrelevant in the context of domains) she seemed to be claiming that the Better Business Bureau has exclusive rights to the string “BBB”.

As Pritz noted later, there are 50 registered trademarks for “BBB” – I’ve counted about 18 live ones in the US alone – and any one of those trademark owners would be able to object to .bbb.

There was also substantial confusion about the state of the program. Congressmen conflated separate controversies in order to support the view that new gTLDs should be delayed.

As I’ve noted before, there’s a worrying lack of detail on certain outstanding issues – such as continuity funding requirements – but Congressmen had evidently been fed different talking points and therefore peppered Pritz with questions about the state of ICANN’s negotiations to amend the Registrar Accreditation Agreement, an unrelated matter.

If two themes could be said to have emerged from the hearing, and last week’s Senate hearing, often expressed by the same Congressmen or witnesses, I’d say they were:

First, ICANN should make it harder for criminals to abuse new gTLDs.

Second, ICANN should make it cheaper and easier to obtain new gTLDs.

I would point out that a certain degree of doublethink is required to hold both positions true, but to do so would imply that the necessary singlethink had been done already.

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ICANN leaves new gTLD batching and support questions hanging

Kevin Murphy, December 13, 2011, Domain Policy

ICANN came closer to answering two very important questions about the new top-level domains application process at its board meeting last Thursday.

While confirming that cheaper application fees will be made available to worthy applicants, and that some sort of batching system will be introduced, ICANN has provided worryingly few details about both systems, just a month before the new gTLD program starts.

Application batching

ICANN is currently expecting over 1,000 new gTLD applications, but it’s said that it only has the capacity to process 500 at a time. It needs a way to fairly create two or more batches.

Commercial applicants obviously want their gTLDs processed and delegated as quickly as possible, so how the batches are created is obviously a critical detail.

Little progress has been made on this issue since Dakar.

A lottery has been ruled out, according to Thursday’s board resolutions, because it would be likely to attract nuisance lawsuits under California gambling law.

If you’ve been following ICANN closely for the last few months, or reading DI, you already knew this.

The board has also said that there will be no benefit to applying early during the January-April application window. We already knew this too.

Instead, as ICANN staff have said before and the board has now approved, there will be a “secondary time stamp … used for purposes of determining the processing order”.

This system has evidently not been finalized yet. Nevertheless, the resolution contains a few hints about how it might work.

First, the TLD Application System will not be used to acquire the stamps, but it may be used to communicate [something] with applicants.

Acquiring a stamp will require “judgment” by applicants. Getting into the first batch will apparently be a skill game, so as to not invite lottery lawsuits.

There will also be some kind of regional allotment system, so that applicants from outside Europe and North America have just as good a chance of getting into the first batch.

Finally, there will be an opt-out mechanism, so applicants with less urgent applications (.brands, perhaps) can choose to be batched later.

It’s not much to go on, but since the process of acquiring a time stamp will not come into play until after April 12, it’s not something applicants need to worry too much about at the moment.

It’s also not yet clear whether positions in the queue will be transferable. A slot in the first batch could be worth something, to some applicants.

Applicant Support

A mechanism for granting reduced fees to “needy” applicants in the developing world has been on the cards for a while. ICANN set aside $2 million in June to fund an Applicant Support program.

On Thursday, its board of directors approved an application fee reduction from $185,000 to $47,000, for “candidates that qualify according to the established criteria”.

While full details of these criteria have not been revealed, the board resolution suggests that “demonstrating need and operating in the public benefit” are the primary factors.

It’s not clear any more that the support program will be limited to applicants in the developing world, as had been recommended by the Joint Applicant Support working group.

The resolution does not mention geography, and senior VP Kurt Pritz suggested at last week’s US Senate hearing into new gTLDs that the YMCA of the USA may qualify for the reduced fee.

It appears that applicants wanting to take advantage of the reduced fee will have to take a bit of risk, however, paying their $47,000 fee up-front on the understanding that they will lose their money and their application if they are subsequently deemed unworthy of support.

Applicants will not find out if they’ve made the cut until November 2012.

ICANN’s $2 million only covers reduced fees for 14 applicants, and it’s not yet clear what would happen if more than 14 candidates qualify and ICANN cannot find third-party funding to support them.

Essentially, it’s looking a bit messy at the moment, and non-profits are only a little closer to understanding what their funding requirements might be today than they were last week.

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