How many brands will lie in their gTLD applications?

The Association of National Advertisers and related groups are currently telling ICANN and anyone who will listen that big brands don’t want new top-level domains.
But many of the ANA’s members, including members of its board, are understood to be currently talking to domain consultants and registries about applying for their own .brand gTLDs.
Assuming that the ANA is not lying, and that its members don’t want .brands, what on earth are these companies going to say in their applications next year?
If they are thinking about applying purely defensively (and I use that word loosely), truly believing that new gTLDs are useless, how will they answer the all-important Question 18(b)?

How do you expect that your proposed gTLD will benefit registrants, Internet users, and others?

The question, which was added to the Applicant Guidebook this year at the request of the Governmental Advisory Committee, is not scored, but is expected to be answered.
The answers will be published, and they will also be used in ICANN’s future reviews of the program.
The ANA is already on-record stating “there are no material or obvious benefits”, so an answer to 18(b) from one of its members that states anything other than: “We don’t think it will benefit anyone.” is going to look like a horrible lie.
And lying isn’t allowed. It’s in the Guidebook’s terms and conditions:

Applicant warrants that the statements and representations contained in the application (including any documents submitted and oral statements made and confirmed in writing in connection with the application) are true and accurate and complete in all material respects

Any company that lies in its application runs the risk of losing its whole $185,000 application fee and having its application rejected.
Okay, I admit, I’m being a bit cheeky here – I don’t really think anyone will be rejected for using a bit of colorful marketing BS in their applications. I doubt the evaluators will even notice.
I am perhaps suggesting that the ANA’s outrage today may not fully reflect the diversity of opinions among its board and general membership.
Either way, it’s going to be fascinating to read the applications filed by ANA members, and to compare their words to the positions they’re allowing ANA management to put forth on their behalf today.

Beckstrom strikes back at ANA threat

ICANN president Rod Beckstrom has come out swinging against the latest attack on its new top-levels domains program, promising to “vigorously defend” it.
In his response to a harshly critical missive from the Association of National Advertisers, Beckstrom calls ANA’s claims “either incorrect or problematic in several respects”.
I think “firmly worded” would be an appropriate way to characterize his letter (pdf).
In it, he notes that the new gTLD program has been on the cards since 1998, and has been developed over several years using input from the entire ICANN community, including ANA itself.
He further states that some of the complaints outlined by ANA president Bob Liodice show a lack of research.
As I noted in my interview with Liodice yesterday, ANA seems to think cybersquatting at the top-level will be enabled unless companies defensively apply for their “.brand” gTLDs.
Beckstrom said that these statements “demonstrate a lack of understanding of Program details”.

The letter suggests that companies have no choice but to apply for their own gTLDs. Operating a gTLD means assuming a number of significant responsibilities; this is clearly not for everyone. Indeed, it is hoped that those without an interest in making a contribution to expanded choice or innovation in the DNS will not apply. One clear directive of the consensus policy advice on which the program is built is that TLDs should not infringe the existing legal rights of others. The objection process and other safeguards eliminate the need for “defensive” gTLD applications, because where an infringement of legal rights can be established using these processes, an application will not be approved.

The response goes on to outline some of the mandatory second-level trademark protection mechanisms that have been included in the program’s Applicant Guidebook.
ICANN is arguably on shakier ground here – making use of these mechanisms is still going to cost brand owners time and money, which is the basis of ANA’s objections.
The question now is whether Beckstrom’s responses will be enough to get ANA to call off the dogs.
He has offered to talk to ANA to “to discuss how the ANA might participate more actively in the policy development activities and other ICANN processes going forward”.
That’s specifically not an offer to get into negotiations with ANA about the contents of the Guidebook or to delay the launch of the program.
That was never going to happen, particularly not in response to a thirteenth-hour complaint from an organization that hasn’t commented on the program for the last two years.
Liodice said yesterday that unless ICANN agrees to suspend the program, ANA plans to lobby the US Congress, its Department of Commerce, and may sue.
Reaction from the domain name industry to Beckstrom’s letter has so far been predictably positive.

Advertisers threaten to sue over new gTLDs

The Association of National Advertisers is threatening legal action unless ICANN “abandons” its recently approved new generic top-level domains program.
Its CEO, Robert Liodice, has written to his ICANN counterpart Rod Beckstrom outlining its litany of concerns about new gTLDs.
ANA’s strongly worded arguments will be familiar territory for anyone who has been following development of the program for the last few years.
It’s worried about cybersquatting, typosquatting, phishing, as well as the cost of defensive registrations and post-launch trademark enforcement.
The organization represents 400 companies that collectively spend $250 billion every year on their brands, according to the letter.
It also claims that ICANN shirked its duties by failing to adequately consider the economic impact of the program, and that it failed to develop it in a transparent, bottom-up manner.
Liodice wrote (pdf), with my emphasis:

ICANN must not ignore the legitimate concerns of brand owners and the debilitating effect on consumer protection and healthy markets its unsupervised actions will cause. Should ICANN refuse to reconsider and adopt a program that takes into account the ANA’s concerns expressed in this letter, ICANN and the Program present the ANA and its members no choice but to do whatever is necessary to prevent implementation of the Program and raise the issues in appropriate forums that can consider the wisdom, propriety and legality of the program.

The letter ends with a bunch of legal blah about ANA’s rights and remedies, a pretty obvious indication that it’s considering its legal position.
ICANN should “abandon” the program until ANA’s concerns have been addressed, Liodice wrote.
That’s not going to happen, of course.
There’s no way ICANN can put a halt to the program without basically admitting ANA’s analysis of it has merit.
If ANA wants to stop new gTLDs from going ahead, it’s going to need to do more than send a letter.
The letter is CC’d to the US Department of Commerce and several Congressmen, which suggests that we may see another Congressional hearing into the program before too long.
But will we see a lawsuit as well?
ICANN, at least, has anticipated the likelihood of having to defend itself in court for some time.
About 30% of the the $185,000 application fee – $30 million in a 500-application round – is allocated to various “risks”, of which a legal defense fund is one component.
I’d be surprised if ICANN’s legal team hasn’t war-gamed potential claims and defenses every time the Applicant Guidebook has been updated.
The next five months are going to be very interesting times.