Running a premium domain name auction before you’ve finished your new gTLD sunrise period is Officially Not Cool, according to ICANN’s compliance department.
People who won premium new gTLD domains in auctions that took place before sunrise periods now face the possibility of losing their names to trademark owners.
.CLUB Domains, and probably XYZ.com, operators of .club and .xyz, two of the highest-volume new gTLDs to launch so far, appear to be affected by the ICANN decision.
ICANN told .CLUB that its “winter auction“, which took place in late February, may have violated the rules about allocating or “earmarking” domains to registrants before sunrise takes place.
Meanwhile, NameJet has cancelled the auction for deals.xyz, which “sold” for $8,100 late last year, suggesting that .xyz’s pre-sunrise auction is also considered ultra vires.
ICANN told .CLUB that its auction sales “constitute earmarking” in violation of the rule stating that registries “must not allow a domain name to be allocated or registered prior to the Sunrise period”.
.CLUB had told its auction winners that a sunrise period registration would prevent them from getting the domain they wanted and that they would be refunded if a sunrise registrant emerged.
But ICANN evidently told the registry:
Irrespective of whether “[a]llocation was expressly conditioned upon any Sunrise claim,” or whether any Sunrise claim was made, the pre-selection, pre-registration or pre-designation to third parties, in this case via .Club Domains’ “winter auction,” constitutes improper allocation.
I kinda thought this would happen.
Back in November, when XYZ.com ran its first .xyz auction — about six months before its sunrise even started — CEO Daniel Negari told us he believed it was “comfortably within the rules“.
We said the auction “seems to be operating at the edge of what is permissible under the new gTLD program’s rights protection mechanisms, which state that no domains may be allocated prior to Sunrise.”
I’ve not yet been able to definitively confirm that .xyz is affected by this ICANN decision, but .club definitely is.
.CLUB Domains told its auction winners today that the names they won are now subject to a 60-day period during which they could be obtained by trademark owners.
If no trademark owner claims the name, .CLUB said it will give the auction winner a 10% rebate on their purchase price.
The email states:
We are placing the domain on hold for 60 days, during which time a Trademark Clearinghouse (TMCH) holder will have the opportunity to purchase the domain at Sunrise rates. Although, the domain is not currently in the TMCH, if a trademark holder should file in the TMCH over the next 60 days, the domain will be offered to that registrant. However, if the name is not claimed by filing in the TMCH over the next 60 days, your transaction will move forward as planned.
Although we disagree with ICANN compliance’s position on this matter, the actions we are taking are necessary to ensure that we are not offside with ICANN compliance in any way. We understand that you have been caught in the middle of this issue due to no fault of your own. Given these circumstances, we are offering you two options:
1) Should you decide to complete this transaction, we will issue you a payment of 10% of the purchase price after the transaction closes in 60 days, assuming the name is not registered by a TMCH mark holder because of the delay.
2) At any time during the 60 day period you have the option to rescind the auction bid and not purchasing the domain.
.club has overtaken .guru to become the top-selling new gTLD on the market.
According to today’s zone file report, .club now has 59,120 domains, having grown by 2,504 yesterday. That’s compared to .guru, which grew by 181 names to 58,791.
It’s been 12 days since .CLUB Domains predicted it would be at the top of the league table “within days”.
It’s taken 20 days for the gTLD to beat .guru, something the registry at first reckoned would happen within its first week of full general availability.
I don’t think yesterday’s spike has anything to do with the 50 Cent endorsement deal.
As far as I can tell, Fiddy has only been linking to his .com shop on Twitter since his .club domain went live and the deal does not seem to have generated any media coverage outside of domain blogs.
Taking the number one spot is only a relative success, of course. What’s important is that .club is still managing to move 2,500 names in a day three weeks after launch, something no other new gTLD has managed to date.
Curtis ’50 Cent’ Jackson accidentally supported “.com” while he was endorsing da new .club gTLD at a launch party at a New York nightclub last night.
As previously reported, Fiddy is da first significant celebrity endorser of a new gTLD. He’s being paid to use 50inda.club, a web site developed by .CLUB Domains, as his new social media hub.
“In Da Club” was of course his breakthrough hit, in 2003.
He showed up at da Tao nightclub in New York — which had been rebranded “.CLUB” for one night only — last night for about 90 minutes in order to meet fans and pose for selfies, etc.
I was there. As disclosure, .CLUB had paid for my airfare from London, a night in a hotel, and copious amounts of alcohol.
I didn’t attempt to get into da roped-off VIP area where Fiddy was being held, but I gather that da bouncers guarding it were somewhat selective in who he got to meet.
He also publicly spoke, alongside .CLUB’s CEO Colin Campbell and CMO Jeff Sass, for about 30 seconds, in order to provide his official endorsement of da new gTLD.
Da problem was that during his brief address he referred to his support for “.com”, which is a little bit like a celebrity being paid to endorse Pepsi referring to how much he loves Coke.
Probably just a Freudian slip. We’ve all done it.
Unfortunately, I can’t give you da full quote just yet. It was quite noisy in there, and I’d consumed quite a bit of Cristal with diamond flakes floating in it. But a lot of people who videoed da address on their phones tell me it will be on YouTube shortly.
Fortunately for .CLUB, I don’t think what he said matters that much.
What matters is how frequently his people link to his new .club domain on his social media channels, how much mainstream media coverage his endorsement generates, and how many people register .club domains as a result.
Getting Fiddy as an anchor tenant will not have come cheap — my guess, and it is just a guess, is that da deal is costing .CLUB high six figures at least — so da company will have to sell a lot of domains to make it pay off.
UPDATE May 26: Here’s .CLUB’s video of da event. Fiddy says he’s very excited to launch his “50 in da .com club”. He later gets it right, referring to “.club” more than once.
.CLUB Domains moved into the number two spot on the new gTLD league table overnight, but its growth appears to be slowing.
In today’s zone files, .club has 47,362 domains under management, having added 734 on Sunday; .berlin stood at 47,243, having added 33 yesterday.
.guru still leads with 56,813 names.
Sunday is typically a slow day for domain registrations across the industry, but .club’s growth does appear to be slowing compared to its first few days of general availability, regardless.
It saw 1,141 net new names on Friday and 1,351 on Saturday. The previous Friday and Saturday adds were at 4,904 and 3,828.
It’s difficult to get a comprehensive picture of daily growth due to the registry missing a few days of zone files last week.
.CLUB Domains failed to overtake .guru in its first week of general availability as promised, but the company is nevertheless upbeat about taking the number one spot “within days”.
The last zone file available for .club shows 41,203 names, but that’s the May 14 file. The company, or its back-end, has been having trouble keeping its zone file current in the ICANN system this week.
That was an increase of of 10,523 over five days, or 2,104 per day on average.
As of 1500 UTC yesterday, the company reckoned it had 44,450 sales.
That would still place it at #3 in the league table behind .guru with 56,097 (up 200 names today) and .berlin with 47,079 (up 60 names).
If the growth rates stay roughly the same, .club may well overtake .guru in less than a week.
CEO Colin Campbell told us in March that “I firmly believe that .CLUB will exceed all other new generic top level domains in the first week of launch in registrations and overtake .GURU as the leader.”
The company is hosting a party in New York with celebrity endorser 50 Cent next Thursday (disclosure: I’m attending on .CLUB’s dime) which may or may not lead to a spike.