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TLDH expects gTLD auctions in second half of 2013

Kevin Murphy, November 2, 2012, Domain Registries

While some new gTLD portfolio applicants are trying to get their contention sets resolved as quickly as possible, Top Level Domain Holdings reckons auctions won’t happen until the second half of 2013.

In a trading update this week, the company also said that it expects to start seeing revenue from its first successful new gTLD applications next year, with contested bids producing revenue in 2014.

TLDH said in a statement:

Provided that the ICANN proposed timetable is broadly adhered to, the Board of TLDH believes that a number of the Group’s 17 uncontested gTLD applications on its own behalf and the 5 uncontested client gTLD applications are likely to be revenue producing in 2013, with the balance becoming so in the first half of 2014. TLDH has commenced discussions with the leading worldwide registrars, premium name specialists, and secondary market platforms for distribution of these gTLD names.

TLDH is also working with other gTLD applicant groups to define formats for private auctions and other name resolution arrangements in respect of the contested names that TLDH has applied for. The Board expects that these auctions are likely to happen in the second half of 2013.

As we reported last week, fellow portfolio applicant Donuts approached competing applicants at the Toronto ICANN meeting last month with a proposal for running private auctions in early 2013.

The idea was not warmly received by many, we hear, and TLDH evidently does not agree.

The company also revealed this week that it plans to move its headquarters to Dublin, Ireland, and expects to start hiring more staff and directors in the near future.

Clark Landry, who has been a non-executive director of TLDH for several years, has left the board, TLDH announced.

Caspar von Veltheim, who has been managing some of TLDH’s geographic gTLD bids in Europe, has joined the board as an executive director, the company added.

Dengate Thrush quits TLDH

Kevin Murphy, October 18, 2012, Domain Registries

Peter Dengate Thrush, executive chairman of new gTLD portfolio applicant Top Level Domain Holdings, has decided to quit not much more than a year into the job.

According to a press release, Dengate Thrush will leave the company in January 2013, to be replaced by original chair Fred Krueger.

No reason for the departure was given.

When he joined TLDH, his share option package envisaged him sticking around until at least July 2014.

Dengate Thrush will continue to advise some of TLDH’s new gTLD applicant clients after he leaves, according to the press release.

His decision to join TLDH in July 2011, just a few weeks after helping to push through approval of the new gTLD program as ICANN’s chairman, was a nodal point in ICANN’s recent evolution.

It led directly to strict conflict of interest rules being put in place on ICANN’s board, which are now being criticized by some contracted parties for removing vital expertise from the board.

It also gave plenty of ammunition to those who criticize ICANN for being too focused on enriching its insiders.

TLDH has applied for 70 gTLDs, and its Minds + Machines subsidiary is the named back-end provider for several more.

TLDH wants to unmask mystery gTLD commenter

Kevin Murphy, September 4, 2012, Domain Registries

Portfolio new gTLD applicant Top Level Domain Holdings has responded to the dozens of claims of financial irregularity being submitted to ICANN by a mystery commenter.

The company told DI tonight that the allegations “may be legally actionable” and that it will ask ICANN to remove the comments and ask it to provide identifying information about the commenter.

As I blogged earlier, someone identifying themselves as Alexander Drummond-Willoughby — which some suspect to be a pseudonym — has filed 82 virtually identical comments about TLDH applications.

Today, he started filing the same comments on applications belonging to TLDH clients.

Here’s what TLDH had to say:

TLDH / Minds + Machines is disappointed that ICANN is allowing individuals hiding behind fictional identities to make accusations against us and our clients that are baseless and may be legally actionable. TLDH, as a company listed on the AIM market of the London Stock Exchange, is closely overseen by our Nominated Advisor, Beaumont Cornish, a firm licensed by the LSE to monitor our compliance with Exchange rules and applicable laws. The incoherent insinuations coming from these shadowy commenters are without merit and any charges that we have engaged in illegal or unethical activity are completely untrue. TLDH reserves all its rights and will ask ICANN to remove the comments and provide us with appropriate identifying information of these posters.

Drummond-Willoughby is quite an unusual surname with an aristocratic pedigree, but there doesn’t seem to be any evidence that that he is fictional, just an absence of evidence — such as a disclosed affiliation or any search engine results for his name — that he is real.

Mystery commenter targets M+M new gTLD clients

Kevin Murphy, September 4, 2012, Domain Registries

Having filed dozens of comments criticizing Top Level Domain Holdings’ financial acumen, someone calling himself Alexander Drummond-Willoughby has turned his attention to the company’s new gTLD clients.

Drummond-Willoughby has filed 82 comments with ICANN, until today all of them targeting TLDH’s own gTLD applications and all of them alleging some kind of unspecified financial irregularity.

But today he’s filed exactly the same allegations against applicants, such as BRS Media and the Fédération Internationale de Basketball, that have selected TLDH subsidiary Minds + Machines as their back-end registry services provider.

It’s a barely coherent argument, but the rub of it appears to be that TLDH has made a few bad financial bets, such as investing £180,000 in a potential .nyc applicant that failed to secure the support of New York City.

The source for Drummond-Willoughby’s information appears to be TLDH’s own regulatory filings — the company is listed on London’s Alternative Investment Market — and not exactly secret.

Drummond-Willoughby, for somebody who’s clued-in enough to know about the new gTLD program, has done a remarkably good job of keeping his name out of Google’s index and other search engines, leading to suspicions that it’s a pseudonym.

Here’s his comment on the FIBA bid for .basketball.

UPDATE: TLDH has provided the following statement:

TLDH / Minds + Machines is disappointed that ICANN is allowing individuals hiding behind fictional identities to make accusations against us and our clients that are baseless and may be legally actionable. TLDH, as a company listed on the AIM market of the London Stock Exchange, is closely overseen by our Nominated Advisor, Beaumont Cornish, a firm licensed by the LSE to monitor our compliance with Exchange rules and applicable laws. The incoherent insinuations coming from these shadowy commenters are without merit and any charges that we have engaged in illegal or unethical activity are completely untrue. TLDH reserves all its rights and will ask ICANN to remove the comments and provide us with appropriate identifying information of these posters.

New gTLD hopefuls set aggressive targets for ICANN

Kevin Murphy, August 22, 2012, Domain Registries

ICANN should start delegating new gTLDs in the first quarter of next year as previously planned and the Governmental Advisory Committee should work faster.

That’s according to many new gTLD applicants dropping their ideas into ICANN’s apparently semi-official comment box on application “metering” over the last week or so.

ICANN wanted to know how it should queue up applications for eventual delegation, in the wake of the death of batching and digital archery.

According to information released over the past couple of weeks, it currently plans to release the results of Initial Evaluation on all 1,924 still-active applications around June or July next year, leading to the first new gTLDs going live in perhaps August.

But that’s not good enough for many applicants. Having successfully killed off batching, their goal now is to compress the single remaining batch into as short a span as possible.

The New TLD Applicant Group, a new observer group recognized by ICANN’s Registry Stakeholder Group, submitted lengthy comments.

NTAG wants Initial Evaluation on all applications done by January 2013, and for ICANN to publish the results as they trickle in rather than in one batch at the end.

The suggested deadline is based on ICANN’s recent statement that its evaluators’ processing powers could eventually ramp up to 300 applications per month. NTAG said in its comments:

Notwithstanding ICANN’s statements to the contrary, there is not a consensus within the group that initial evaluation results should be held back until all evaluations are complete; in fact, many applicants believe that initial evaluation results should be released as they become available.

That view is not universally supported. Brand-centric consultancy Fairwinds and a couple of its clients submitted comments expressing support for the publication of all Initial Evaluation results at once.

January 2013 is an extremely aggressive deadline.

Under the batching-based schedule laid out in the Applicant Guidebook, 1,924 applications would take more like 20 months, not seven, to pass through Initial Evaluation.

NTAG could not find consensus on methods for sequencing applications among its members. Separate submissions from big portfolio applicants including Donuts, Uniregistry, TLDH and Google and smaller, single-bid applicants gave some ideas, however.

Donuts, for example, hasn’t given up on a game-based solution to the sequencing problem – including, really, Rock Paper Scissors – though it seems to favor a system based on timestamping.

The company is among a few to suggest that applications could be prioritized using the least-significant digits of the timestamp they received when they were submitted to ICANN.

An application filed at 15:01:01 would therefore beat an application submitted at 14:02:02, for example.

This idea has been out there for a while, though little discussed. I have to wonder if any applicants timed their submissions accordingly, just in case.

Comments submitted by TLDH, Google and others offer a selection of methods for sequencing bids which includes timestamping as well alphabetical sorting based on the hash value of the applications.

This proposal also supports a “bucketing” approach that would give more or less equal weight to five different types of application – brand, geographic, portfolio, etc.

Uniregistry, uniquely I think, reckons it’s time to get back to random selection, which ICANN abandoned due to California lottery laws. The company said in its comments:

Random selection of applications for review should not present legal issues now, after the application window has closed. While the window was still open, random selection for batches would have given applicants an incentive to file multiple redundant applications, withdrawing all but the application that placed earliest in the random queue and creating a kind of lottery for early slots. Now that no one can file an additional application, that lottery problem is gone.

Given that the comment was drafted by a California lawyer, I can’t help but wonder whether Uniregistry might be onto something.

Many applicants are also asking the GAC to pull its socks up and work on its objections faster.

The GAC currently thinks it can file its official GAC Advice on New gTLDs in about April next year, which doesn’t fit nicely with the January 2013 evaluation deadline some are now demanding.

ICANN should urge the GAC to hold a special inter-sessional meeting to square away its objections some time between Toronto in October and Beijing in April, some commenters say.

ICANN received dozens of responses to its call for comments, and this post only touches on a few themes. A more comprehensive review will be posted on DI PRO tomorrow.

New gTLD application batching dead?

Kevin Murphy, June 26, 2012, Domain Policy

It’s looking increasingly possible that not only is digital archery dead, but that ICANN may also kill off the idea of batching new gTLD applications entirely this week.

Given the number of groveling apologies from staff and board about the failure of digital archery over the last few days, there doesn’t seem to be any way it can be plausibly reinstated following its shut-down last week.

But from the first three days of meetings and hallway conversations here at ICANN 44 in Prague, it’s pretty clear that doing away with batching is under serious consideration at board level.

It’s also my understanding that ICANN staff, which initially appeared reluctant to abandon plans to divide the 1,930 applications into three or four batches, is now also thinking along the same lines.

Batching is unpopular among most — but by no means all — applicants, because they don’t want to risk losing a time-to-market advantage by being allocated to a later batch.

When director Chris Disspain told an audience of applicants yesterday, “What I think the board thinks you want now is certainty,” the reaction suggested he had hit the nail on the head.

The problem ICANN has with a single batchless evaluation process is that it faces — hypothetically at least — up to 1,409 unique gTLDs exiting Initial Evaluation at the same time.

This could cause problems because it’s promised the DNS root server operators and the Governmental Advisory Committee that it will delegate no more than 1,000 new gTLDs per year.

These commitments are, at least for now, non-negotiable, chairman Steve Crocker has indicated this week.

So ICANN has to figure out a way to “rate limit” application processing so that no more than 1,000 gTLDs go live in the same 12 month period.

Many opponents of batching have stated that the process already contains several throttling mechanisms, or “gateways” as ARI Registry Services CEO Adrian Kinderis calls them.

For starters, not every application will be successful. Some will be withdrawn soon because they were tactical filings, others will not pass Initial Evaluation and will be withdrawn.

Some will fail Initial Evaluation and enter Extended Evaluation. Others will face formal objections or will find themselves in contention resolution.

In these cases, applicants can expect an extra six months of processing time, which will act as a natural throttle.

For those applications that get through to contract negotiations, ICANN’s legal department will operate on a strict first-in-first-out basis with the paper contracts, Disspain said yesterday.

But there’s a concern that these gateways might not be enough to smooth out the evaluation and approval process.

Various solutions have been put forward by the ICANN community so far this week.

These have ranged from the predictable “IDN applicants should go first” from IDN applicants and “brands should go first” from brand applicants, which both seem unlikely to be adopted, to some more inventive ideas.

Top Level Domain Holdings founder Fred Krueger and others have suggested that one way to prioritize applications would be to ask the large portfolio applicants — TLDH, Google, Donuts, et al — to decide which of their gTLDs they want to hit the root first.

“I value .london significantly more than I value .beer,” Krueger said yesterday. “I’m sure Google values .google more than .lol.”

Another idea, put forward by Uniregistry’s outside counsel Bret Fausett yesterday, was to rank applications according to how cleanly they exit Initial Evaluation.

Applications that made it through Initial Evaluation without the evaluators needing to ask any clarifying questions would be considered the “first batch”. Those that needed a single question answered would be the “second batch”, and so on.

This system would have the advantages of enabling a single batch while rate-limiting applications based on their inherent quality.

On the face of it, it’s quite an attractive idea, and it’s my sense that Fausett’s approach was well-received by ICANN. We might be hearing more about it as ICANN 44 progresses.

Digital archery suspended, surely doomed

Kevin Murphy, June 23, 2012, Domain Policy

ICANN has turned off its unpopular “digital archery” system after new gTLD applicants and independent testing reported “unexpected results”.

As delegates continue to hit the tarmac here in Prague for ICANN 44, at which batching may well be hottest topic in town, digital archery is now surely doomed.

ICANN said in a statement this morning:

The primary reason is that applicants have reported that the timestamp system returns unexpected results depending on circumstances. Independent analysis also confirmed the variances, some as a result of network latency, others as a result of how the timestamp system responds under differing circumstances.

While that’s pretty vague, it could partly refer to the kind of geographic randomness reported by ARI Registry Services, following testing, earlier this week.

It could also refer to the kind of erratic results reported by Top Level Domain Holdings two weeks ago, which were initially dismissed as a minor display-layer error.

TLDH has also claimed that the number of opportunistic third-party digital archery services calibrating their systems against the live site had caused latency spikes.

Several applicants also said earlier this week that the TLD Application System had been inaccessible for long periods, apparently due to a Citrix overloading problem.

Only 20% of applications had so far registered their archery timestamp, according to ICANN, despite the fact that the system was due to close down on June 28.

Make no mistake, this is another technical humiliation for ICANN, one which casts the resignation of new gTLD program director Michael Salazar on Thursday in a new light.

For applicants, ICANN said evaluations were still proceeding according to plan, but that the batching problem is now open for face-to-face community discussion:

The evaluation process will continue to be executed as designed. Independent firms are already performing test evaluations to promote consistent application of evaluation criteria. The time it takes to delegate TLDs will depend on the number and timing of batches

The information gathered from community input to date and here in Prague will be weighed by the New gTLD Committee of the Board. The Committee will work to ensure that community sentiment is fully understood and to avoid disruption to the evaluation schedule.

Expect ICANN staff to take a community beating over these latest developments as ICANN 44 kicks off here in Prague.

There’s light support for batching, and even less for digital archery. It’s looking increasingly likely that neither will survive the meeting.

TLDH posts six-month loss

Top Level Domain Holdings has posted a loss of $2.2 million in its latest interim financial report.

The company, which is one of the largest new gTLD applicants, saw a loss of £1.4 million ($2.2m) for the six months ended April 30, on revenue that was up from £26,000 to £136,000 ($213,000).

Given that TLDH’s game plan is to make money selling domain names in many of the 92 new gTLDs it hopes to have an interest in, its profitability runway is still dependent to a large extent on ICANN’s schedule.

The revenue in its latest period came mostly from consulting services.

On the up side, the company’s balance sheet is looking much better; it had an extra £10.7 million ($16.8m) in receivables on its books as of April 30 (which appears to be its “investment” in ICANN application fees), as well as £4.3 million ($6.7m) cash.

Its interim report can be read in PDF format here.

Schilling applies for “scores” of new gTLDs

Domaining icon Frank Schilling’s new venture, Uniregistry, has applied for “scores” of new generic top-level domains, “most” of which he expects to be contested.

Schilling won’t say exactly how many or which strings Uniregistry is pursuing, but he did reveal that while he is not going for .web, he will be in contention with Google for .lol.

“It’s closer to TLDH than Donuts,” Schilling told DI in an interview this evening, referring to the announcements of Top Level Domain Holdings’ 68 and Donuts’ 307 applications.

I’m guessing it’s around the 40 to 50 mark.

Despite the portfolio and Schilling’s history in domain investing, Uniregistry isn’t what you might call a “domainer” play.

The company doesn’t plan on keeping whole swathes of premium real estate for itself or for auction, Schilling said. Nor does it intend to rip off trademark owners.

“We’ve seen good TLDs fail with bad business plans,” he said, pointing to premium-priced .tv as an example. “You need to allow other people to profit, to evangelize your space.”

“I’m not going to get as rich from this as some of our registrants,” he said.

Uniregistry only plans to hold back a “handful” of premium names, Schilling said. The rest will be available on a first-come, first-served basis.

To avoid creating wastelands of parked domains, the company plans to deploy technical countermeasures to prevent too many domains falling into too few hands.

“The way we’re going stage the landrush it will be very difficult to game it,” he said. “There’ll be significant rate limiting, so you can’t come and take 500 domains in ten milliseconds.”

“What we want to avoid is someone going in and getting 100,000 of the best ones on day one. It’s not fair, and it’s unhealthy for the space.”

Schilling is one of the industry’s most successful domainers. His company, Name Administration, is one of the largest single owners of second-level domain names.

Now Schilling says he’s brought his considerable experience as a domain name registrant Uniregistry’s business model and policies.

The company’s message is that it’s “registrant-centered”.

While that sounds like an easy, glib marketing statement, Schilling is backing it up with some interesting policies.

He’s thinking about a much closer relationship between the registry and the registrant that you’d see in the .com space.

When a second-level domain in a Uniregistry gTLD expires, registrants will get 180 days to claim it back from the registry, possibly even circumventing the registrar.

Uniregistry will even directly alert the registrant that their name is going to expire, a policy that Schilling said has been modeled in part on what Nominet does in the .uk space.

“Registrants have the ability to go to the registry to manage their .co.uk, to transfer the domain, to change certain pieces of information,” he said.

The 180-day policy is designed in part to prevent registrars harvesting their customers most valuable domains when they forget to renew them.

Rogue registrars and registrars competing against their own customers are things that evidently irk Schilling.

“I prefer a system that protects registrants,” he said.

But existing registrars are still the company’s proposed primary channel to market, he said. Uniregistry plans to price its domains in such a way as to give registrars a 50% margin.

“I think there’s enough margin in these strings for registrars to make a great living,” Schilling said.

Schilling hasn’t ruled out an in-house pocket registrar, but said it wouldn’t be created to undercut the regular channel.

The company has hired Internet Systems Consortium, maker of BIND and operator of the F-Root, as its back-end registry provider.

Judging by Uniregistry’s web site, which carries photos of many ISC staff, it’s an unusually close relationship.

I’ll have more on Uniregistry’s plans for Whois and trademark protection in a post later.

Third .app gTLD applicant revealed

A Ukrainian software developer has become the third company to publicly reveal that it has applied for the .app top-level domain.

MacPaw’s main business is developing software for Apple platforms, as the name suggests. It’s formed a new company, Dot App Inc, based in California, to manage the gTLD bid.

The application imagines a very pro-developer space. Domainers, it appears, will not be welcome.

Some policies from its web site:

– Only application developers or publishers will be able to register domain names in this zone

– Misused domains will be analyzed and repurposed if found to violate the Registration policy

– No need to pay a small fortune for a great but squatted .com or .net domain.

– The rights of app creators will be protected in the same way trademark rights are

Top Level Domain Holdings and Directi both last week announced plays for .app among their large portfolios of gTLD applications.

More applicants will no doubt be revealed next week.