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New gTLDs not an illegal conspiracy, court rules

Kevin Murphy, August 5, 2015, Domain Policy

ICANN has beaten off a lawsuit from alternate root provider name.space for a second time, with a US appeals court ruling that the new gTLD program was not an illegal conspiracy.

name.space sued ICANN in 2012, claiming that the program broke competition laws and that “conflicted” ICANN directors conspired with the industry in an “attack” on its business model.

The company runs an alternate DNS root containing hundreds of TLDs that hardly anyone knows about, cares about, or has access to.

Almost 200 of the strings in its system had matching applications in the 2012 new gTLD round; many have since been delegated.

The company’s complaint asked for an injunction against all 189 matching TLDs.

But a court ruled against it in 2013, saying that name.space had failed to make a case for breaches of antitrust law.

Last week, an appeals court upheld that ruling, saying that the company had basically failed to cross the legal threshold from simply making wild allegations to showing evidence of an illegal conspiracy.

“We cannot… infer an anticompetitive agreement when factual allegations ‘just as easily suggest rational, legal business behavior.’,” the court ruled, citing precedent.

“Here, ICANN’s decision-making was fully consistent with its agreement with the DOC [US Department of Commerce] to operate the DNS and the Root,” it wrote. “In transferring control to ICANN, the DOC specifically required it to coordinate the introduction of new TLDs onto the Root. This is exactly what ICANN did in the 2012 Application Round”.

“The 2012 rules and procedures were facially neutral, and there are no allegations that the selection process was rigged,” the panel ruled.

The court further ruled that ICANN is not a competitor in the markets for domain names as registry, registrar or defensive registration services, therefore it could not be subject to antitrust claims for those markets.

A few other claims against ICANN were also dismissed.

In short, it’s a pretty decisive victory for ICANN. General counsel John Jeffrey said in a statement that ICANN is “pleased” to have won.

All the major documents in the case, including the latest opinion, can be downloaded here.

While the lawsuit has been making its way through the courts, the .space gTLD has actually been delegated and the domain name.space is owned by its new registry, Radix.

There’s some salt in the wounds.

New gTLD phishing still tiny, but .xyz sees most of it

New gTLDs are not yet being widely used to carry out phishing runs, but most such attacks are concentrated in .xyz.

That’s one of the conclusions of the Anti-Phishing Working Group, which today published its report for the second half of 2014.

Phishing was basically flat in the second half of the year, with 123,972 recorded attacks.

The number of domains used to phish was 95,321, up 8.4% from the first half of the year.

However, the number of domains that were registered maliciously in order to phish (as opposed to compromised domains) was up sharply — by 20% to 27,253 names.

In the period, 272 TLDs were used, but almost 54% of the attacks used .com domains. In terms of maliciously registered domains, .com fared worse, with over 62% share.

According to APWG, 75% of maliciously registered domains were in .com, .tk, .pw, .cf and .net.

Both .tk and .cf are Freenom-administered free ccTLDs (for Tokelau and the Central African Republic) while low-cost .pw — “plagued” by Chinese phishers — is run by Radix for Palau.

New gTLDs accounted for just 335 of the maliciously registered domains — 1.2% of the total.

That’s about half of what you’d expect given new gTLDs’ share of the overall domain name industry.

Twenty-four new gTLDs had malicious registrations, but .xyz saw most of them. APWG said:

Almost two-thirds of the phishing in the new gTLDs — 288 domains — was concentrated in the .XYZ registry. (Of the 335 maliciously registered domains, 274 were in .XYZ.) This is the first example of malicious registrations clustering in one new gTLD, and we are seeing more examples in early 2015.

XYZ.com aggressively promoted cheap or free .xyz names during the period, but APWG said that only four .xyz phishing names were registered via freebie partner Network Solutions.

In fact, APWG found that most of its phishing names were registered via Xin Net and used to attack Chinese brands.

But, normalizing the numbers to take account of different market shares, .xyz shapes up poorly when compared to .com and other TLDs, in terms of maliciously registered domains. APWG said:

XYZ had a phishing-per-10,000-domains score of 3.6, which was just slightly above the average of 3.4 for all TLDs, and lower than .COM’s score of 4.7. Since most phishing domains in .XYZ were fraudulently registered and most in .COM compromised, .XYZ had a significantly higher incidence of malicious domain registrations per 10,000 coming in at 3.4 versus 1.4 for .COM.

APWG said that it expects the amount of phishing to increase in new gTLDs as registries, finding themselves in a crowded marketplace, compete aggressively on price.

It also noted that the amount of non-phishing abuse in new gTLDs is “much higher” than the phishing numbers would suggest:

Tens of thousands of domains in the new gTLDs are being consumed by spammers, and are being blocklisted by providers such as Spamhaus and SURBL. So while relatively few new gTLD domains have been used for phishing, the total number of them being used maliciously is much higher.

The number of maliciously registered domains containing a variation on the targeted brand was more or less flat, up from 6.6% to 6.8%.

APWG found that 84% of all phishing attacks target Chinese brands and Chinese internet users.

The APWG report can be downloaded here.

UPDATE: XYZ.com CEO Daniel Negari responded to the report by pointing out that phishing attacks using .xyz have a much shorter duration compared to other TLDs, including .com.

According to the APWG report, the average uptime of an attack using .xyz is just shy of 12 hours, compared to almost 28 hours in .com. The median uptime was a little over six hours in .xyz, compared to 10 hours in .com.

Negari said that this was due to the registry’s “aggressive detection and takedowns”. He said XYZ has three full-time employees devoted to handling abuse.

Dirty tricks claimed in .music fight

Kevin Murphy, April 22, 2015, Domain Registries

A .music hopeful has tried to add over 300 pages of documents to its new gTLD application, apparently in an effort to leapfrog competitors, and its rival community applicant is far from happy.

DotMusic Limited submitted the change request (pdf) in order to add some Public Interest Commitments to its .music bid.

Rival .Music LLC now claims that it is “outrageous and unfair for ICANN to allow this applicant to abuse the PIC process in this way” and has filed a Request for Reconsideration.

Of the eight .music bidders, these two companies are the only formal “community” applicants.

Under the rules of the new gTLD program, community applicants can avoid having to fight an auction if they win a strict Community Priority Evaluation.

To avoid confusion: DotMusic Limited is the applicant led by Constantine Roussos; .Music LLC (aka Far Further) is led by John Styll.

Far Further fought a CPE last year but lost in spectacular fashion, scoring just 3 out of the 16 available points, a long way shy of the 14 points required for a pass.

The Roussos applicant has now submitted eight new proposed Public Interest Commitments — things it promises to do to protect registrants and rights holders — as an addendum to its application.

That’s pretty standard stuff.

What’s unusual are the 308 pages of additional “clarifications” that seek to explain how the proposed PICs relate to its original application.

They’re not changes to the application, technically speaking, but they are a way to get hundreds of extra pages of content into the public record ahead of DotMusic’s own CPE.

According to Styll, this latest gambit is nothing more than an attempt to score more CPE points. He told ICANN:

the 308 additional pages of “clarifications” contain wording that clearly utilizes learnings from previous CPE results (including our own), in violation of ICANN policy

Complicating matters, it turns out that Far Further tried to make some substantive changes to its application back in May 2014, but had the request declined by ICANN “in order to be fair to other applicants”.

That was prior to ICANN’s publication of guidelines governing change request, Styll says.

Because of this alleged discrepancy between how the two competing change requests were handled, Far Further wants a second crack at the CPE for its own application.

Its RfR (pdf) asks ICANN to reverse its May 2014 decision, allow its change request, throw out the original results of its CPE and refer the CPE to a new Economist Intelligence Unit panel for a full reevaluation.

Failing that, it wants ICANN to throw out the 308 pages of “clarifications” submitted by DotMusic.

Both applicants have the written support of dozens of music industry groups.

There’s some crossover, but Far Further’s backers appear to me to be a little more “establishment” than DotMusic’s, including the likes of the Recording Industry Association of America.

The other, non-community applicants are Amazon, Google, Donuts, Radix, Famous Four Media and Entertainment Names.

With Google and Amazon in the mix, if it goes to auction, .music could easily be an eight-figure auction along the lines of .app, which sold to Google for $25 million.

In my view, winning a CPE is the only way DotMusic has a chance of getting its hands on .music, short of combining with another applicant.

Tucows and Namecheap exit $14m .online deal

Tucows and Namecheap have both pulled out of their joint venture with Radix to run the .online registry.

Tucows revealed the move, which will see Radix run .online solo, in a press release yesterday.

Both Tucows and Namecheap are registrars, whereas Radix is pretty much focused on being a registry nowadays.

While financial terms have not been disclosed, Tucows CEO Elliot Noss had previously said that each of the three companies had funded the new venture to the tune of $4 million to $5 million.

I estimate that this puts the total investment in the deal — which includes the price of winning .online at auction — at $13 million to $14 million.

Noss has also hinted that the gTLD sold for much more than the $6.8 million paid for .tech.

.online has not yet been delegated.

Google buys .app for over $25 million

Kevin Murphy, February 26, 2015, Domain Registries

The fiercely competed new gTLD .app has sold to Google for a record-breaking $25 million.

The company’s Charleston Road Registry subsidiary beat out 12 other applicants for the string, including Donuts, Amazon, Famous Four Media, Radix and Afilias.

The auction lasted two days and fetched a winning bid of $25,001,000, more than any other new gTLD to date.

The previous high is believed to be .blog, which I estimate sold for less than $20 million.

Because it was an ICANN-run “last resort” auction, all of the money goes into ICANN’s special auction proceeds fund, which previously stood at just shy of $35 million.

Previous ICANN auctions have fetched prices between $600,000 and $6,760,000.

Google originally proposed .app as a closed registry in which only Google and its partners could register names.

However, after the Governmental Advisory Committee pressured ICANN to disallow “closed generics”, Google changed its application to enable anyone to register.

.blog won in eight-figure auction by Primer Nivel

Kevin Murphy, February 16, 2015, Domain Registries

A Colombian registrar has become the unlikely owner of the coveted .blog new gTLD, beating eight other applicants to the string at auction.

Winning bidder Primer Nivel is a Panamanian company affiliated with Bogota-based CCI REG, which runs my.co.

The company was the first to reveal its plans to apply for .blog, telling DI back in April 2012 about its ambitions of the gTLD.

Rival bidders Radix, Minds + Machines, Donuts, Afilias, Merchant Law Group, BET, Google and Top Level Design all withdrew their applications over the weekend.

We’re certainly looking at an eight-figure sale here.

Kieren McCarthy, writing at The Register, reckons it went for $30 million or more, based on the fact that M+M got $3.4 million for withdrawing from .blog and .store auctions, but his back-of-the-envelope calculations are off-target for a few reasons.

Knowledgeable DI sources say the sale price was considerably lower than $30 million.

My envelope puts it at somewhere in the range of $15 million to $18 million.

I’ve always said .blog is among my favorite new gTLD strings. The market opportunity is potentially huge, with hundreds of millions of blogs live on the web today.

Primer Nivel, which to the best of my knowledge is not (unlike some other applicants) affiliated with a particular blogging platform, plans to operate .blog as an open gTLD.

The separate auction for .store, meanwhile, was won by Radix, after withdrawals from M+M, Donuts, Amazon, Google, Dot Store and Uniregistry this weekend.

Hotly contested gTLDs up for auction tomorrow

Kevin Murphy, December 16, 2014, Domain Registries

ICANN’s fifth set of last-resort new gTLD auctions is set for tomorrow and it’s another small batch.

Just two contention sets — .baby and .mls — are set to be resolved, with ICANN stashing the winning bids into its special fund.

.baby is hotly contested with no fewer than six applicants — five portfolio applicants and one big brand.

Will Johnson & Johnson get what was once a single-registrant “closed generic”, or will Donuts, Google, Radix, Famous Four or Minds & Machines prevail?

Meanwhile, .mls (for “multiple listing service”, a type of real estate listings aggregation service popular in North America) is a two-horse race between Afilias and the Canadian Real Estate Association.

I’m tempted to call this one for CREA. The organization is so desperate for the .mls gTLD that it filed two applications, one “community” and one vanilla.

The community application was withdrawn earlier this year when CREA scored 11 out of 16 points on its Community Priority Evaluation, failing to pass the 14-point threshold.

The organization even filed a Legal Rights Objection against Afilias in attempt to kill off the competition, which also failed.

Having fought off these challenges, Afilias is either going to get the gTLD or walk away empty-handed. The last resort auction does not compensate unsuccessful bidders for their investments.

Donuts wins five more new gTLD auctions

Kevin Murphy, December 3, 2014, Domain Registries

Donuts added five new gTLDs to its ever-growing portfolio this week, as the results of five private auctions were revealed.

The company won the following strings:

.news — went to Donuts after withdrawals from Merchant Law Group, Amazon, Radix, Uniregistry, Famous Four Media and Primer Nivel. As somebody with a vested interest in the news media, I’m glad this one went to a registry with an open registration policy.

.golf — Donuts beat Famous Four, Dot Golf and Fegistry.

.casino — Donuts won after withdrawals from Famous Four, Afilias and dotBeauty.

.school — Donuts beat Fegistry, Uniregistry and Minds + Machines.

.football — Donuts beat Famous Four.

The registry currently has 156 delegated TLDs, more than half of those it originally applied for. It has another 99 active applications in various stages of pre-delegation.

Over 180,000 blocked new gTLD names to drop next week

Kevin Murphy, November 20, 2014, Domain Registries

Several new gTLD registries will release hundreds of thousands of currently blocked domain names — some of them quite nice-looking — next Wednesday.

It’s one of the first big batches of name collisions to be released to market.

The companies behind .xyz, .website, .press, .host, .ink, .wiki, .rest and .bar will release most of their blocked names at 1400 UTC on November 26. These registries all use CentralNic as their back-end.

The gTLD with the biggest “drop” is .host, with over 100,000 names. .wiki, .website and .xyz all have 10,000 to 20,000 releasing names apiece.

According to Radix business head Sandeep Ramchamdani, A smallish number — measured in the hundreds — of the .host, .press and .website names are on the company’s premium domain lists and will carry a higher price.

He gave the following sample of .website domains that will become available at the baseline, non-premium, registry fee:

analyze.website, anti.website, april.website, bookmark.website, challenge.website, classics.website, consumer.website, definitions.website, ginger.website, graffiti.website, inspired.website, jobportal.website, lenders.website, malibu.website, marvelous.website, ola.website, clients.website, commercial.website, comparison.website

Drop-catching services such as Pool.com are taking pre-orders on names set to be released.

Other registries have already released their name collisions domains.

I gather that .archi, .bio, .wien and .quebec have already unblocked their collisions this week.

Donuts tells us it has no current plan for its first drops. Rightside, which runs Donuts’ back-end, is reportedly planning to drop names in a couple dozen gTLDs on the same date in January.

As we reported earlier this week, millions of names are due to be released over the coming months, due to the expiration of the 90-day “controlled interruption” phase that ICANN forced all new gTLD registries to implement.

By definition, name collision names already have seen traffic in the past and may do so again.

Noss hints at winning .online auction bid

Kevin Murphy, November 13, 2014, Domain Registries

A triumvirate of domain name companies led by Radix paid well over $7 million for the .online new gTLD, judging by comments made by Tucows CEO in an analysts call yesterday.

As the company reported its third-quarter financial numbers, Noss said of .online, which was recently auctioned:

While we are bound by confidentiality with respect to the value of the transaction, we can point to amounts paid in other gTLDs’ auctions in the public domain — like $6.8 million for .tech, $5.6 million for .realty, or the $4.6 million that Amazon paid for .buy — and let you decide what you think .online should be valued, relative to those more narrowly targeted extensions.

Radix won the private auction with financial backing from Tucows and NameCheap.

The three companies intend to set up a new joint venture to manage the .online registry, as we reported yesterday, with each company contributing between $4 million and $5 million.

Assuming at least one company is contributing $4 million and at least one is contributing $5 million, that works out to a total of $13 million to $14 million, earmarked for the auction and seed funding for the new venture.

Based on that knowledge, an assumption that the new company will want a couple of million to launch, and Noss’s comments yesterday, I’d peg the .online sale price in the $10-12 million range.

Radix business head Sandeep Ramchamdani told us yesterday that the company plans to market .online with some “hi-decibel advertising” and participation in events such as Disrupt and South by Southwest.