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How many brands will lie in their gTLD applications?

Kevin Murphy, September 9, 2011, Domain Policy

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.

If you pre-register a domain, you are the product

Kevin Murphy, September 8, 2011, Domain Registries

“If you’re not paying for it, you are the product.”

That’s a maxim that has been doing the rounds on the internet for the last few years to describe services such as Facebook, which gets users in for free and then monetizes them to third parties.

It struck me today that this saying also applies to services that allow you to pre-register domain names in non-existent top-level domains.

If you’ve recently registered your interest in a domain in a new gTLD – example.web, say – you’ve gained nothing and potentially lost a lot.

Pre-registering creates two main benefits as I see it, and neither accrues to the registrant.

First, you’re now on the company’s mailing list. When your selected new gTLD(s) go live, the company you pre-registered with is going to try to convert you into a paying customer.

Second, you’ve just freely contributed information to an extremely valuable database, possibly to your own detriment.

When new gTLDs launch, many registries are going to reserve thousands of premium domains to either sell or auction at a later date, to periodically drum up interest in their extensions.

How will these companies decide which domains to add to their premium lists? A database of hundreds of thousands of pre-registrations would be a great place to start looking.

If you pre-register, what you may be doing is voting for your desired domain to be reserved by the registry, for possibly years, and then sold at a large premium.

Something to think about.

What The X Factor taught me about new gTLDs

Kevin Murphy, September 4, 2011, Domain Registries

Elitist, pseudo-intellectual snob that I am, I rarely watch commercial television. But I make an exception when the The X Factor is on.

I’m not sure I’d even describe the show as a guilty pleasure. It’s just consistently great television.

I’m not alone. According to BARB, which tracks viewing figures in the UK, The X Factor is Britain’s top-rated show, with about 11 million viewers each Saturday night.

It is estimated that a 30-second spot in the latest series costs advertisers £154,000 ($250,000), which will likely increase dramatically as buzz builds toward the December finals.

If a company is willing to spend $250,000 on a single ad spot, I got to wondering how these advertisers use domain names. The price of a new “.brand” gTLD is in the same ball park, after all.

So rather than zoning out during The X Factor‘s commercial breaks last night, I took notes.

Of the 15 brands advertised during the show, five did not promote their online presence at all. Ads for products such as breakfast cereal showed no URLs, search terms or Facebook profiles.

Another three displayed their domains on-screen as footnotes, but with no explicit call to action.

Two advertisers, amazon.co.uk and weightwatchers.co.uk, explicitly encouraged the viewer, on-screen and in the voice-over, to visit their sites.

Barclays was the only advertiser that asked viewers to find it using a search engine. Its call to action was “search Barclays offset mortgage”, with no accompanying URL.

There were also a couple of ads that used call-to-action .co.uk domains.

Mars used bagamillionmovies.co.uk to direct viewers to an M&Ms movie competition, while Microsoft (windows.co.uk/newpc) was the only advertiser to use a directory in addition to its domain.

But the two commercials that interested me the most were those that used alternative or “new” TLDs – the ones that are usually afterthoughts when you’ve already put a .com into your cart.

Mars used getsomenuts.tv to advertise Snickers, and the healthcare giant Johnson & Johnson asked viewers to visit sleepchallenge.info.

That’s right. J&J seems to be spending six-figure sums advertising a .info domain during Britain’s most-watched TV show every Saturday night.

This is noteworthy for, among other reasons, the fact that J&J has a seat on the board of directors of the Association of National Advertisers.

The ANA is of course currently leading the campaign against ICANN’s new gTLD program.

ANA general counsel Doug Wood rubbished .info, albeit only by association, in a video interview with WebProNews on Friday, stating:

The idea of [ICANN’s new gTLD program] being successful and delivering the competition or the innovation that they’re speculating on is clearly questionable to a great degree, based purely on the success or lack of success of the last group they introduced – .biz, .travel, .jobs, etc – none of which has as done anything significant vis-a-vis competition or innovation

I would suggest that the existence of sleepchallenge.info shows how dubious these claims are.

First, sleepchallenge.info redirects to a rather longer URL at johnsonsbaby.co.uk. This indicates that it was registered purely to act as a memorable and measurable call-to-action domain.

The fact that J&J used the .info, rather than sleepchallenge.co.uk, which it also owns, suggests that the company appreciates the additional meaning in the word “info”.

(Mere added semantic value would make a poor definition of innovation, but until now it’s been one of the few things that new gTLD registries have been able to offer.)

The domain sleepchallenge.info was a hand registration in May 2010, according to Whois records, costing J&J just $35 from Network Solutions.

The .com equivalent has been registered since 2007 and would have cost substantially more to acquire from its current registrant, if indeed it was for sale, which it may not be.

Because ICANN introduced competition into the gTLD market 11 years ago, J&J was able to obtain a meaningful domain for a massive ad campaign at a low price.

Watching The X Factor has taught me that Johnson & Johnson is an ANA board member that has already directly benefited from new gTLDs.

I guess commercial TV can be educational after all.

What Europe’s demands mean for new gTLDs

Kevin Murphy, September 1, 2011, Domain Policy

The European Commission wants stronger government powers over ICANN’s new top-level domain approval process, according to leaked documents.

Six “informal background papers” obtained and published by .nxt yesterday indicate that the EC, perceiving snubs over the last six months, plans to take a hard line with ICANN.

The documents cover a lot of ground, including a discussion of the various mechanisms by which governments would be able to force ICANN to reject new gTLD applications.

This article covers just the bases related to new gTLDs.

As things currently stand, ICANN’s Applicant Guidebook gives governments three ways to register their objections to any given gTLD application. The EC wants two of them strengthened.

GAC Early Warning

The Governmental Advisory Committee may formally put an applicant on notice that one or more governments have a problem with their bid.

Any government can initiate an Early Warning “for any reason”, at any point during the 60-day public comment period that is currently scheduled to begin April 27.

The mechanism is designed to give applicants a chance to get out with their cash before a more formal objection is filed by the GAC or an individual government.

Applicants in receipt of such a warning can choose to withdraw at that point, receiving a partial refund of their fees, but it’s entirely voluntary.

Under the EC’s new proposals, a GAC Early Warning would trigger an additional requirement by the applicant to show the support of “the relevant internet community”.

Because there’s little chance of getting this provision into the Guidebook now, the EC wants this provision baked into ICANN’s IANA contract with the US Department of Commerce.

The IANA contract is currently the biggest stick governments have to beat ICANN with. It’s up for renewal before March, and it’s the US that decides what goes into the contract.

The European Commission paper on new gTLDs says:

The IANA contract should include a provision requiring applicants to positively demonstrate the support of the relevant Internet community in advance of formal consultation of the GAC (and other supporting organisations and advisory committees), in cases where there are prima facie grounds to believe that the application may raise a public policy concern.

The paper explains: “in other words, if the GAC issues an early warning, the applicant would be automatically required to demonstrate the support of the relevant Internet community”.

In the Guidebook today, only applicants that have self-designated as “community” applications have to show this level of support, using a strict scoring process.

The EC’s proposal could, hypothetically, force non-community applicants to show a similar level of support if a single government initiates an Early Warning in the GAC.

If there was a vanilla, non-community application for .gay, for example, an Early Warning spurred (anonymously) by Saudi Arabia, say, could force the applicant to provide evidence of community support.

How this evidence would be evaluated is unclear. It would depend on what final language the Department of Commerce puts into the IANA contract.

At a guess, it could be a matter for the ICANN board to decide, with the Damoclean sword of IANA non-compliance hanging over its decision.

Formal GAC Advice

The Guidebook today allows for over six months, from April 27 to November 12, for the GAC to formally object to any gTLD application.

The way the GAC will create this formal “GAC Advice on New gTLDs” is a black box. We probably won’t even be told which governments objected, or what level of support they received.

ICANN had tried to enforce certain transparency and procedural requirements on this mechanism, but the GAC told it to take a hike and ICANN bent over in the interests of expediency.

But any such Advice will nevertheless “create a strong presumption for ICANN that the application should not be approved”.

The ICANN board will technically still be able to overrule one of these objections, but it practice it seems unlikely. At the very least it’s not predictable.

Under the European Commission’s new proposals, this fail-safe would be weakened further:

The ICANN by-laws should be amended to ensure that consensus GAC advice is accepted as reflecting the global public interest, and should ICANN wish to reject such advice, it would bear the burden of demonstrating that the GAC advice would conflict with ICANN’s legal obligations or create problems for the stability or security of the Domain name System.

In other words, the bar for an ICANN board decision to overrule the GAC would be raised to only include cases where there was a legal or technical reason not to comply.

The GAC would have an effective veto on every decision ICANN is asked to make. The term “multi-stakeholder” would be subverted in almost textbook Orwellian fashion.

To have this proposal implemented, the EC suggests that ICANN and the GAC enter talks. There’s no talk of running to the US government to have it unilaterally imposed.

Reserved Words

Currently, all new gTLD registries will be forced to reserve strings such as country names from their spaces, and deal with individual governments to open them up.

The EC wants the list expanding to include basically any word that governments ask for, and it wants the US government to make this a condition of IANA contract renewal:

In relation to reserved and blocked names at the second level, the IANA contract should require the contractor to develop appropriate policies to allow governments and public administrations to identify names to be included in a reference list to be respected by all new gTLD operators.

This request appears to have been inspired by ICM Registry’s offer to block “culturally sensitive” strings from .xxx at the request of governments.

Yet again, we find global internet policy being driven by sex. What is it with these politicians?

Domain Name Takedown

Incredibly, the EC also wants the IANA contract to include a provision that would allow any government to ask any gTLD registry to turn off any domain:

The contractor [ICANN] should also be required to ensure that governments and public administrations can raise concerns about particular names after their registration if a serious public order concern is involved, and with a view to the registry “taking down” the name concerned.

This clearly hasn’t been thought through.

Facebook.com and Twitter.com have both been blamed recently for raising “serious public order concerns” in everything from the Egyptian revolution to the London riots.

The new powers the EC is discussing would have given the despotic former government of Egypt a legal basis for having Twitter shut down, in other words.

Cross-Ownership

Finally, the EC is still concerned, on competition grounds, about ICANN’s decision to drop the vertical separation rules that apply to registries and registrars.

It suggests that the IANA contract should create a new oversight body with an “extra-judicial review” function over ICANN, enabling its decisions to be challenged.

This would enable antitrust authorities in Europe or elsewhere to challenge the vertical integration decision without having to resort to the US courts.

Anyway

Overall, the proposals seem to represent a depressingly authoritarian ambition by the European Commission, as well as a disdain for the idea of the ICANN multi-stakeholder model and a shocking lack of respect for the rights of internet users.

While the documents are “informal background papers”, they do seem to give an indication of what certain elements within the EC think would make reasonable policy.

Whether the positions outlined in the papers became a reality would largely depend on whether the EC’s requests, if they were made, were compatible with US public policy.

As usual, the Department of Commerce still holds all the cards.

Fifth ad group opposes new gTLDs

Kevin Murphy, August 31, 2011, Domain Policy

The World Federation of Advertisers has become the fifth major coalition of advertising big-spenders to ask ICANN to rethink its new gTLD program.

Stephan Loerke, managing director of the Brussels-based organization, wrote to Rod Beckstrom, to “strongly urge ICANN to abandon the program in its current form”.

The letter (pdf) explicitly echoes statements first made by Bob Liodice of the US Association of National Advertisers, which is a WFA member.

To recap, these organizations are worried about consumer confusion, leading to phishing and cybersquatting and an increase in the cost of defending trademarks online.

Loerke said in a press release:

ICANN’s decision flies in the face of their own impact assessments, which highlight the potential dangers and massive costs that unlimited domain names could incur. Worse, it could lead to significant confusion among consumers and expose them to abuse by fraudulent operators.

The WFA is an umbrella trade group that comprises the national advertising trade groups of 50-odd countries. It also has 50-odd brand names as members.

Its members collectively spend $700 billion a year on advertising.

As well as the ANA, the Interactive Advertising Bureau, the Association of American Advertising Agencies and the UK Direct Marketing Association have recently opposed the new gTLD program.