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Clarity for .brands in new Guidebook

Kevin Murphy, May 31, 2011, Domain Policy

Companies planning to apply for a “.brand” top-level domain have had some of their concerns put to rest in the latest version of ICANN’s Applicant Guidebook.

Potential .brands were worried that ICANN might try to redelegate their trademarked TLDs to a third-party operator in the event that they decided to discontinue the domain.

They were also concerned that the Code of Conduct would require them to offer equitable access to all accredited registrars – a ridiculous situation for a single-registrant TLD.

Both of these problems seem to have been addressed in the new Guidebook, which enables registries to ignore the Code of Conduct and redelegation scenario if they can satisfy three criteria.

They have to show to ICANN’s satisfaction that “all domain name registrations in the TLD are registered to, and maintained by, Registry Operator for its own exclusive use”, that it does not sell to third parties, and that to redelegate the TLD or enforce the Code “is not necessary to protect the public interest”.

These changes make the .brand proposition a lot more realistic, less risky, and may put many concerns to rest.

They do stop short of requests from potential .brands such as Microsoft, which wanted a TLD operator’s express written consent to be required before a redelegation took place, however.

.brand TLDs still face barriers

Kevin Murphy, May 16, 2011, Domain Policy

Companies planning to apply for “.brand” top-level domains still have concerns that ICANN’s new gTLD program does not adequately cater to their unique requirements.

ICANN has so far resisted calls from the likes of the Coalition for Online Accountability to create clearly delineated categories of gTLD, instead favoring the one-size-fits-all approach.

But one type of gTLD where the Applicant Guidebook has started to introduce exceptions to the rules is the so-called “.brand”.

In its latest draft, for example, the Guidebook’s Code of Conduct for vertically integrated registries/registrars does not apply to single-registrant TLDs such as .brands.

The Guidebook also makes it mostly clear that ICANN does not intend to re-assign .brands to different registry operators in the event that the brand decides to discontinue the TLD.

But those who are working with potential .brand applicants still have concerns.

Co-existence

Arguably biggest outstanding problem to emerge from the latest set of comments filed with ICANN is the notion of “co-existence”, raised by the likes of Valideus, ECTA and the Business Constituency.

The Guidebook currently calls for TLDs that are potentially confusing in meaning or appearance to be lumped into the same “contention sets” from which only one winner will emerge.

The worry is that this will capture companies with similar sounding brands. ECTA called for a mechanism to exclude .brands from these requirements:

The Draft Applicant Guidebook 6 does not take into account either co‐existence agreements or natural co‐existence. Currently a successful application from NBC in round one would preclude ABC or BBC or NBA in future years. Equally, should both EMI, the music company and ENI, the energy company apply, they would be placed in a Contention Set and could in theory face each other in an auction. In the real world these companies co‐exist.

It’s an interesting point, and not one that’s received a great deal of airplay in recent discussions.

There’s also the problem that companies with two-letter brands, such as HP or BP, are essentially banned from getting their .brand, because there’s a three-letter minimum on new TLDs.

Geographic name protections

The ICANN Governmental Advisory Committee has pushed hard for the protection of geographical terms at the second level in new gTLDs, and has won significant concessions.

One of the results of this is that if Canon, say, has .canon approved, it will be unable to immediately use usa.canon or japan.canon domains names – one of the most logical uses of a .brand.

ICANN plans to enable registries to loosen up these restrictions, but the Guidebook does not currently spell out how this will happen, which leaves a significant question mark over the value of a .brand.

ECTA wrote in its comments to ICANN:

This prohibition severely limits brand owners unnecessarily. On the contrary a .brand domain should provide clients with an intuitive replacement for ccTLDs. It would seem to be more logical if Internet users could replace www.mycompany.de with www.de.mycompany rather than having to type www.mycompany/de.

Registrar discrimination

The BC has called for the Guidebook to be rephrased to made it clear that .brand TLDs should not have to offer their domains through a multitude of registrars on “non-discriminatory” terms.

The BC wants this language adding to the rules: “Single-Registrant TLDs may establish discriminatory criteria for registrars qualified to register names in the TLD.”

Given .brands will have essentially one customer, it would be a pretty crazy situation if more than one registrar was approved to sell them. It may be a hypothetical risk, but this is a strange industry.

UDRP

All new gTLD registries will have to abide by the Uniform Dispute Resolution Process. The problem is that successful UDRP cases generally result in a domain name being transferred to the complainant.

This could result in a situation where a third-party trademark holder manages to win control a domain name in a competitor’s .brand TLD, which would be intolerable for any brand owner.

The BC suggests that domains won in this way should be allowed to be set to “reserved and non-resolving” instead of changing hands.

Hitachi to apply for .hitachi

Japanese electronics giant Hitachi has emerged as the second big consumer brand to officially announce it will apply for a “.brand” top-level domain.

GMO Registry, also based in Japan, is the company’s back-end provider of choice, according to this news release (pdf).

GMO is also working with Canon, which was the first company to announce its .brand TLD bid, .canon.

As I noted yesterday, IBM is also a likely candidate for a .brand domain, but it has not officially announced its intentions yet.

Nokia, Deloitte and Unicef are also known to be considering their options.

(via UrbanBrain)

Winners and losers in the next Applicant Guidebook

Kevin Murphy, February 23, 2011, Domain Registries

Who’s going to be happy, and who won’t be, after ICANN publishes the next version of its Applicant Guidebook for new top-level domains in April?

We now have a rough idea of the answers to those questions, following the publication this week of ICANN’s analysis of comments received between November and January.

The 163-page document (pdf) outlines where ICANN is still open to changing its rules for applying for a TLD, and where it believes the book is firmly shut.

As you might expect, at this late stage in the game, most of the analysis is essentially “thanks, but no thanks”, reiterating the reasons why the Guidebook currently says what it says.

But there are strong indications of which changes will be made to the “next” version of the Guidebook, which is currently expected to hit the ICANN web site April 14.

Here’s a high-level analysis of the winners and losers.

Impatient Applicants

Companies and entrepreneurs that have been tapping their feet for the last couple of years, hit by delay after delay, can probably take comfort from the fact that ICANN is still making encouraging noises about its commitment to the new TLDs program.

Noting that some issues are still in need of further work, ICANN staff writes:

it is ICANN’s intention to reach resolution on these issues. It would be irresponsible to use community resources to run a process without the intention to see it through to conclusion.

ICANN continues to approach the implementation of the program with due diligence and plans to conduct a launch as soon as practicable along with the resolution of these issues

Beyond what I noted in a post earlier this afternoon, there are no clues about the timetable for actually launching the program, however.

Trademark Holders

It’s a mixed bag for the intellectual property lobby, but on balance, given the length of its wish-list, I expect the trademark crowd will be more disappointed than not.

In general, ICANN is firm that the rights protection mechanisms (RPMs) in the Guidebook are the result of community compromise, and not for changing.

This is sometimes the case even when it comes to issues ICANN plans to discuss with its Governmental Advisory Committee next week.

One of these is the Trademark Clearinghouse, the database of trademark rights to be used to reduce cybersquatting, of which ICANN says:

subject to further refinement through the GAC consultation and other comments received to date, the positions in the Clearinghouse proposals will be finalized substantially similar to as it was in the Proposed Final Applicant Guidebook.

On the Globally Protected Marks List, a mechanism trademark holders want included in the Guidebook, ICANN is suitably mysterious:

It is clear that the trademark interests have continued to raise the GPML as possible RPM. While this discussion may continue, no further progress or decisions have been made.

The most substantial concession ICANN appears ready to make to trademark holders concerns the Uniform Rapid Suspension mechanism, a cousin of the UDRP that will be used to address clear-cut cases of cybersquatting in new TLDs.

A major concern from the IP lobby has been that the URS is too slow and complex to meet its original goals. ICANN disagrees that it does not do the job, but plans to streamline it anyway:

Discussions are continuing and some additional implementation detail revisions will likely be made, for example, creating a form complaint that reduces the 5000-word limit to 500 words. The 500-word limit might not, however, be placed on the respondent, as the respondent will be required to describe the legitimate basis upon with the domain name is registered. The respondents word limit be decreased from 5,000 to something less, possibly 2,500 words, in order to decrease the examinations panel‘s time requirements and thereby enhance circumstances for a relatively loss cost process. (Remember that in the vast majority of cases, it is expected that the respondents will not answer.)

This will certainly be a topic of discussion at the ICANN-GAC meeting in Brussels on Monday, so I expect IP attorneys are even now briefing their governments on how these proposed changes won’t go far enough for whatever reason.

Domainers

There’s bad news if you’re a high-rolling domain investor, looking at bagging a new TLD or three, and you also have a few UDRP losses against your name.

The background check ICANN will carry out on applicants for their history of cybersquatting stays, and it will still use the three-losses-as-UDRP-respondent benchmark.

However, ICANN has recognized that UDRP decisions are not always final. If you lost a UDRP but subsequently won in court, that decision won’t count against you.

In addition, reverse domain name hijacking findings will now also count against applicants to the same degree as UDRP losses.

I believe both of those concessions capture so few entities as to be more or less irrelevant for most potential applicants.

“.brand” Applicants

ICANN is in favor of companies applying to run “innovative” TLDs, such as “.brands”, but it is reluctant to carve out exceptions to the rules for these applicants.

The organization does not plan to give .brands a pass when it comes to protecting geographic names, nor when it comes to the requirement to register domains through an accredited registrar.

This seems to mean, for example, that if Microsoft successfully obtains .microsoft and wants to register usa.microsoft to itself, it will have to ask the US government for permission.

It also means .brands will still have to seek ICANN accreditation, or work with an existing registrar, in order to sell domains to themselves. It’s an added cost, but not an unworkable one.

Would-be .brand applicants did, however, win one huge concession: If they decide to turn off their TLD, it will not be redelegated to a third-party. ICANN wrote, with my emphasis:

In the limited case of .brand and other TLDs that operate as single-registrant/single-user TLDs it would probably make sense to not force an outgoing operator to transition second-level registration data (since presumably the operator could just delete all the names as the registrant anyway and then there would be nothing to transition), and therefore ICANN will put forward proposed language for community review and feedback that would provide for alternative transition arrangements for single-registrant/single-user gTLDs.

If .microsoft was unsuccessful and Microsoft decided to stop running it, Google would not be able to take over the ICANN registry contract, for example.

Poor People/Cheapskates

Some commenters wanted ICANN to reduce application fees in cases where the applicant is from a poorer nation, a non-governmental organization, or when they intend to apply for multiple versions of the same TLD.

They’re all out of luck.

The $185,000 baseline application fee is to stay, at least for the first round. ICANN thinks it could be reduced in future rounds, once more uncertainty has been removed from the process.

Currently, $60,000 of each fee is set aside for a “risk” (read: litigation) war-chest, which will be presumably less of an issue after the first round is completed.

Special Interests

The International Olympic Committee and the Red Cross, as well as financial services organizations, may receive the special concessions they asked for in the next Guidebook.

The IOC and Red Cross may be given the same protections as afforded to ICANN, regional internet registries, and generic terms such as “example” and “test”.

ICANN is considering the nature of these protections, and if appropriate, might augment the reserved names lists in special cases such as requested by the International Olympic Committee (IOC) and the International Red Cross, both of which are globally invested in representing the public interest.

It also emerged that ICANN is working with the financial services industry to clarify some of the security-related language in the Guidebook.

Community Applicants

Sorry guys, ICANN intends to keep the threshold score for the Community Priority Evaluation at 14 out of 16. Nor will you get a bonus point for already showing your cards by starting community outreach two years ago. Winning a CPE is going to be as tough as ever.

*

This is just a brief, non-exhaustive overview of the changes that are likely to come in the next Applicant Guidebook, setting the stage for the GAC talks next week and the San Francisco ICANN meeting next month.

One thing seems pretty clear though: this is end-game talk.

ICANN “intervention” needed on TLD ownership rules

Kevin Murphy, October 28, 2010, Domain Registries

ICANN’s board of directors is today likely to step in to create rules on which kinds of companies should be able to apply for new top-level domains.

Chairman Peter Dengate Thrush now says “intervention appears to be required” on the issue of registry-registrar cross-ownership, after a GNSO working group failed to create a consensus policy.

In an email to the vertical integration working group yesterday, Dengate Thrush thanked particpants for their efforts and added:

The board is faced, in the face of absence of a GNSO position, to examine what should be done. This is a matter we are actively considering.

My sense is that, while reluctant to appear to be making policy, the Board is unwilling to allow stalemate in the GNSO policy development process to act as an impediment to implementing other major policy work of the GNSO, which calls for the introduction of new gTLDS. Some kind of Board intervention appears to be required, and we are considering that.

Currently, placeholder text in the new TLD Draft Applicant Guidebook calls for a 2% cross-ownership cap and effectively bans registrars from applying to become registries.

Such a scenario would very likely make single-registrant “.brand” TLDs unworkable. Canon, for example, would be forced to pay a registrar every time it wanted to create a new domain in .canon.

It would also put a serious question mark next to the viability of geographical and cultural TLDs that may be of limited appeal to mass-market registrars.

Many in the VI working group are in favor of more liberal ownership rules, with larger ownership caps and carve-outs for .brands and “orphan” TLDs that are unable to find registrars to partner with.

But others, notably including Go Daddy and Afilias, which arguably stand to gain more economically from the status quo, favor a stricter separation of powers.

This latter bloc believes that allowing the integration of registry and registrar functions would enable abusive practices.

Dengate Thrush’s email has already raised eyebrows. ICANN is, after all, supposed to create policies using a bottom-up process.

Go Daddy’s policy point man, Tim Ruiz, wrote:

I am hopeful that you did not intend to imply that if the bottom up process does not produce the reults that some of the Board and Staff wanted then the Board will just create its own policy top down.

I hope that the Board keeps its word regarding VI as it was given to the GNSO. To not do so would make it difficult to have any confidence in the Board whatsoever.

It’s a tightrope, and no mistake.