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Defensive registrations with Donuts could be 95% cheaper than normal domains

Kevin Murphy, March 12, 2013, Domain Registries

Portfolio gTLD applicant Donuts plans to offer trademark owners defensive registrations at 5% to 10% of the cost of a normal domain name registration, co-founder Richard Tindal said today.

Speaking at the Digital Marketing & gTLD Strategy Congress here in New York, Tindal also revealed some of Donuts’ current thinking about the Domain Protected Marks List service outlined in its gTLD applications.

DPML, which was created by Donuts rather than ICANN, is a little like ICM Registry’s Sunrise B service for .xxx — trademark owners will be able to block domains related to their trademarks.

DPML domains will not resolve, and there’ll be no annual renewal fee.

But there will likely be several differences with .xxx, as Tindal explained.

How to get a block

Each DPML listing will block a string across all of Donuts’ gTLDs, which could be as many as 307 (if Donuts wins all of its contention sets), potentially reducing administrative headaches for trademark owners.

Second, while ICM only allowed strings to be blocked that exactly matched the trademark, Donuts’ standard will merely be that the blocked domain contains the trademarked string.

Trademark owners will have to buy a DPML listing for each string they want blocked, however. It’s not going to be a “wildcard” system. ING wouldn’t be able to block everything ending in “ing”.

If Microsoft wanted to block microsoft.tlds and microsoftwindows.tlds, it would have to request both of those strings separately, but the blocks would be place across every Donuts TLD.

The standard for inclusion is probably going to be that the trademark is listed in the official Trademark Clearinghouse, and that it would qualify for a Sunrise registration (ie, it’s actually being used).

Trademarks that qualify for the Trademark Claims service but not Sunrise would not, it seems, qualify for DPML.

Un-blocks

There’s also going to be a way for trademark owners to un-block domains that have been blocked by other trademark owners.

If Apple the gadget maker blocked the string “apple” across all Donuts gTLDs, for example, Apple Records would be able to unblock apple.music (if Donuts wins .music) if it had a trademark on “apple” in the TMCH.

The standard again would be that Apple Records qualified for a Sunrise, but the unblocking could actually happen long after the .music Sunrise period was over.

If Apple the gadget maker thought it might want to use apple.tld domains in future, its best best would be to register the domains during Sunrise, Tindal said.

Pricing

DPML listings would be available for either five or 10 years (Donuts hasn’t decided yet, but it’s leaning towards five) and pricing will probably be between 5% and 10% of the cost of registering the domains normally during general availability, Tindal said.

Let’s say, for example, that Donuts wins only a certain number of its contention sets and ends up launching 200 new gTLDs, each of which is priced at $10 per domain per year.

If the 5-10% price estimate holds, trademark owners would have to pay between $0.50 and $1 per string, per gTLD, per year. For a single trademark, that would be between $100 and $200 per year, or $500 to $1,000 over the five-year period of the block.

It doesn’t sound like there’s going to be an option for trademark owners to block their sensitive strings in only selected, relevant Donuts gTLDs using DPML. It’ll be all or none.

Donuts has not yet disclosed its pricing plans for any of its proposed gTLDs, so the numbers used here are of course just examples. They could be higher or lower when the domains come to market.

In addition, if the string in question is a “premium” generic word in one or more of Donuts’ gTLDs, the price of blocking it could head sharply north.

Tindal noted that the plans outlined during today’s conference session represent Donuts’ current thinking and may be subject to change.

Fight over new sports gTLDs gets real ugly

Kevin Murphy, January 10, 2013, Domain Registries

The battle for contested new gTLDs .rugby and .basketball is turning nasty.

Roar Domains, a New Zealand marketing firm whose gTLD applications are backed by the official international bodies for both sports, is promising to pull out all the stops to kill off its competition.

The company, which is partnered with Minds + Machines on both bids, has told rival portfolio applicant Donuts that it will attack its applications for the two TLDs on at least three fronts.

Notably, Roar wants Donuts disqualified from the entire new gTLD program, and plans to lobby to have Donuts fail its background check.

The company told Donuts last month:

while we have no desire to join the chorus of voices speaking out against Donuts, it is incumbent on us to pursue the automatic disqualification of Applicant Guidebook Section 1.2.1, and every opposition and objection process available to us.

Applicant Guidebook section 1.2.1 deals with background checks.

Donuts came under more scrutiny than most on these grounds during the new gTLDs public comment period last year due to its co-founders being involved at the sharp end of domain investment over the last decade.

Demand Media and eNom, where founder Paul Stahura was a senior executive, have lost many UDRP cases over the years.

A mystery lawyer who refuses to disclose his clients started pursuing Donuts last August, saying the company is “unsuited and ineligible to participate in the new gTLD program.”

Separate (pseudonymous?) public comments fingered a former Donuts director for allegedly cybersquatting the Olympics and Disney.

While Roar has not claimed responsibility for these specific previous attacks, it certainly seems to be planning something similar in future.

In addition, Roar and International Rugby Board, which supports Roar’s application for .rugby, say they plan to official objections with ICANN about rival .rugby bids.

The IRB told Donuts, in a letter shortly before Christmas:

As the global representative of the sport and the only applicant vested with the trust and representation of the rugby community, we are unquestionably the rightful steward of .RUGBY.

Without the support of the global rugby community your commercialization efforts for .RUGBY will be thwarted. We are also preparing an objection to file against your application in accordance with ICANN rules to which you will be required to dedicate resources to formulate a response.

Roar and the IRB are also both lobbying members of ICANN’s Governmental Advisory Committee, which has the power to file potentially decisive GAC Advice against any application.

Roar told Donuts recently:

Roar serves as the voice and arm for FIBA [the International Basketball Federation] and IRB in the New gTLD area. We are pleased to have obtained four Early Warnings on behalf of our applications, and fully expect the GAC process to be completed to GAC Advice.

The Early Warnings against the two other .rugby applicants were filed by the UK government — the only warnings it filed — while Greece warned the two non-Roar .basketball applicants.

Roar is also involved with the International Basketball Federation (FIBA) on its .basketball bid.

While commercial interests obviously play a huge role, there’s a philosophical disagreement at the heart of these fights that could be encapsulated in the following question:

Should new gTLDs only be delegated to companies and organizations most closely affiliated with those strings?

In response to the UK’s Early Warning, Donut has written to UK GAC representative Mark Carvell asking for face-to-face talks and making the case for a “neutral” registry provider for .rugby.

Donuts told Carvell:

We believe gTLDs should be run safely and securely, and in a manner that is fair to all law-­abiding registrants, not only those predetermined as eligible. A neutral third party, such as Donuts, can be best capable of achieving this outcome.

Donuts believes a neutral operator is better able to ensure that the gTLD reflects the full diversity of opinion and content of all Internet users who are interested in the term “rugby.”

As the IRB is a powerful voice in rugby, an IRB‐managed registry might not be neutral in its operations, raising questions about its ability to impartially oversee the gTLD. For example, will IRB/Roar chill free speech by censoring content adversarial to their interests? How would they treat third parties who are interested in rugby but aren’t part of the IRB? What about IRB critics or potential rival leagues?

Despite these questions, no .rugby applicant has said it plans to operate a restricted registry. There are no applications for .basketball or .rugby designated as “Community” bids.

The IRB/Roar application specifically states “anyone can register a .rugby domain name.”

Both .basketball and .rugby are contested by Roar (FIBA/IRB/M+M), Donuts (via subsidiaries) and portfolio applicant Domain Venture Partners (aka Famous Four Media, also via subsidiaries).

Roar is a sports marketing agency that is also involved in bids for .baseball, .soccer, .football and .futbol. The New Zealand national team football captain, Ryan Nelsen, is on its board.

Here are the letters (pdf).

Senior Demand Media exec “fired for suing ICANN”

Kevin Murphy, December 3, 2012, Domain Registrars

Long-time Demand Media software architect Chris Ambler claims he was fired when his own company, Image Online Design, sued ICANN over the .web gTLD.

Ambler says he was canned by Demand October 26, eight days after IOD sued ICANN over its unsuccessful 2000-round application for .web.

He told DI on Friday that he believes he was fired unfairly and illegally and, after negotiations with Demand Media broke down last week, has retained a lawyer to explore his options for redress.

“You can’t say you’re firing somebody because they’re suing somebody,” he said. “There are legal options open to me and I am pursuing them.”

Ambler says he was hired by eNom’s then-CEO Paul Stahura in 2003 as its chief software strategist, a role in which he took a lead role in creating NameJet’s proprietary domain name drop-catching software.

When the company was acquired by Demand Media, he took the role of senior software architect.

But in the 1990s, as founder of IOD, he ran .web in an alternative DNS root system. His application to move the gTLD into the official ICANN root in 2000 was not approved.

In October he sued ICANN claiming it was “improper, unlawful and inequitable” for ICANN to solicit more applications for .web while IOD’s bid was still “pending” and unrejected.

While Demand Media is not directly applying for .web, it has an extremely tight relationship with Donuts — the portfolio gTLD applicant founded by Stahura and other former Demand executives — which is.

Demand is Donuts’ back-end registry provider and is believed to have an interest in Covered TLD LLC, the parent company of about 100 of Donuts’ new gTLD applicants, including .web.

Ambler’s contract with Demand Media acknowledged his IOD work and allowed him to pursue it, he claims.

“They’ve known for the past ten years that I was working on this,” he said.

A Demand Media spokesperson said the company does not comment on legal matters.

Here’s how Donuts wants to resolve its 158 new gTLD contention fights

Kevin Murphy, October 23, 2012, Domain Registries

Donuts is backing a private auction model designed and managed by Cramton Associates as its preferred solution for resolving its 158 new gTLD contention sets.

The proposals, spelled out by auction design expert Peter Cramton during private sessions with new gTLD applicants, caused a bit of a buzz — not all of it positive — at the ICANN meeting in Toronto last week.

But Donuts co-founder Jon Nevett told DI today that Cramton has addressed rivals’ concerns and that Donuts wants to handle as many of its contention sets as possible via private auction.

The idea is that private auctions will be faster and cheaper for applicants than the process set out by ICANN as the “last resort” method for resolving contention sets.

In the ICANN model, all of the proceeds of the auction would go to ICANN, to be distributed to worthy causes at a later date. But with a private auction, the winning bidder pays the losers.

This makes it more attractive to applicants, according to Donuts.

“The cost of losing an ICANN auction is greater than the cost of losing a private auction,” Nevett said. “If you lose an ICANN auction you get nothing, zero, you lose your asset.”

But with private auctions, “it doesn’t hurt as much to lose, so the theory is the second-place guys won’t stretch as much,” he said.

Cramton is a professor of economics at the University of Maryland. A long-time auction specialist, he’s been involved in designing processes for selling off wireless spectrum around the world.

For new gTLDs, Cramton proposes an “ascending clock” auction. At each stage, the price is increased by the auctioneer and the bidders/sellers can either commit to pay that amount or drop out.

The last man standing wins the gTLD, paying the amount that the second-highest bidder was willing to pay.

The money would be divided equally between all the losing applicants. According to Cramton, the advantage over proportional distribution is that it does not encourage applicants to over-bid, keeping costs down.

Cramton’s original plan, which left some applicants scratching their heads last week, was to run the auctions in the first quarter of 2013, before ICANN announces the results of Initial Evaluation.

That would mean that losing bidders would get a 70% refund of their ICANN application fee, which may be an attractive percentage in the case of low-value strings.

But it also means that an applicant could win an auction and later discover its application has been rejected. The other applicants would have withdrawn, so the gTLD would just disappear into the ether.

Judging by a series of videos shot last week and published on Cramton’s YouTube account, many applicants are in favor of running the auctions after IE results have been announced.

Another complaint expressed by Donuts’ competitors last week is Cramton’s “all or nothing” approach, in which Donuts’ rivals would have to commit to use the auctions for their entire portfolio of applications.

According to Nevett, that idea is no longer on the table.

“In the beginning he was discussing that it would have to be all your TLDs or none, and I think a lot of applicants told him that was unacceptable, so he changed his view,” he said.

The idea now is that the auctions would proceed on a TLD-by-TLD basis.

Given that winning bidders are giving money to their competitors, another concern is the ordering of the auctions. You don’t necessarily want to give your rivals a big wedge of cash they can use to out-bid you on the next lot.

The preferred solution here appears to be a simultaneous auction, with all the participating contention sets being resolved at the same time.

There was also a deal of suspicion in Toronto about whether Cramton would be biased towards Donuts, given that Donuts is responsible for finding Peter Cramton and introducing him to the gTLD program.

But Nevett said that Donuts has not contracted with Cramton. Peter Cramton showed up in Toronto on his own dime and has not required an up-front payment from Donuts, Nevett said.

“Every applicant has a veto on whether to participate, and it won’t happen unless every applicant wants to do it,” Nevett said. “Our incentive is to have an auction provider who is attractive to every applicant.”

“Our goal is to get as many applicants to participate in a private auction, so we need the auction to be designed in a way that is simple, fair and inclusive,” he said.

But there’s no denying that Donuts has a greater incentive than most to have a consolidated auction. By its own admission, it’s an eight-person operation without the manpower to negotiate 158 contention sets.

Cramton’s materials from last week’s Toronto sessions can be found at applicantauction.com or here.

Donuts signs up to Architelos anti-abuse service

Kevin Murphy, October 10, 2012, Domain Services

Architelos has a secured its first major customer win for the NameSentry anti-abuse service that it launched back in August.

Donuts, the highest-volume portfolio gTLD applicant, has signed up for the service, according to the companies.

For Donuts, which is probably the applicant that makes opponents of new gTLDs the most nervous, it’s another chance to show that it’s serious about operating clean zones.

For Architelos, it’s a pretty significant endorsement of its new technology.

The NameSentry service aggregates abuse data from multiple third-party malware, spam and phising lists and presents it in a way that makes it easier for registries shut down bad behavior.