Is ICANN getting ready to give marching orders to new gTLD applicants? It seems likely given recent hints out of LA.
Currently, of the original 1,930 new gTLD applications, 125 have been withdrawn but only two or three have been rejected.
GCC’s .gcc and DotConnectAfrica’s .africa are both “Not Approved” while Nameshop’s .idn failed to pass its applicant support program tests and seems to have been put aside for this round.
But there are at least 22 active applications that are due to be hit with the ban hammer, by my reckoning. That’s not including those that may be killed off by Governmental Advisory Committee advice.
First, there are seven bids (so far) that have failed Community Objections or Legal Rights Objections filed against them, or have lost String Confusion Objections filed by existing TLD operators.
Applications such as Ralph Lauren’s .polo, Dish DBS’ .direct and Demand Media’s .cam have fallen foul of these three objection types, respectively.
Under the Applicant Guidebook rules, these applications are not allowed to proceed.
There are also 10 active applications for .home and five for .corp, two gTLD strings ICANN has said it will not approve due to their substantially higher risk of causing name collisions.
(Personally, I think these applicants should get full refunds — ICANN screwed up by not doing its homework on name collisions before opening the application window last year).
So far, ICANN seems to have been waiting for applicants to withdraw, rather than initiating a formal rejection.
But none of them actually have withdrawn.
The International Union of Architects, which won a Community Objection against Donuts over .architect in September, has noticed this too, and recently wrote to ICANN to find out what was going on.
Responding October 31, Generic Domains Division president Akram Atallah wrote (with my emphasis):
as a result of the objection determination, we have updated the status of the objection on the .ARCHITECT application to “Objector Prevailed” on the Objection Determinations page (http://newgtlds.icann.org/en/program-‐status/odr/determination) of the New gTLD microsite. Additionally, we will be updating the overall status of this application on the New gTLD microsite (https://gtldresult.icann.org/application-‐result/applicationstatus) pursuant to Section 126.96.36.199 of the Applicant Guidebook in the near future.
This suggests either a “Not Approved” status for .architect, or a new status we haven’t seen before, such as “Lost Objection”.
So could, for example, Demand Media’s .cam application be rejected? Demand lost a SCO filed by Verisign, but its two competitors for the string prevailed in virtually identical cases.
Would it be fair to reject one but not the others, without any kind of ICANN review or oversight?
Last week at the newdomains.org conference in Munich, I asked Atallah a question during a panel discussion about consistency in the new gTLD program, with reference to objections.
I was on stage and not taking notes, but my recollection is that he offered a not at all reluctant defense of subjectivity in panelists’ decision-making.
It was certainly my impression that ICANN is less troubled by inconsistent rulings than the applicants are.
In the .architect case, Atallah told the UIA that ICANN intends to implement objection rulings, writing:
ICANN will, of course, honor all panel decisions regarding objection determinations, unless directed to do otherwise by some action, for example, by virtue of Reconsideration Requests or other accountability mechanisms or action of the ICANN Board of Directors. To our knowledge, Spring Frostbite [Donuts] has not filed a Reconsideration Request or invoked an Independent Review Process with respect to this objection determination regarding the .ARCHITECT string.
ICANN has published a first draft of the rules for its “last resort” new gTLD auctions, but they do not yet address the contention created by controversial objection rulings.
The organization has hired Power Auctions to write the rules and manage the auctions.
They’ve agreed upon an “ascending clock” style, where the auctioneer sets upper and lower limits for each round of bidding. Applicants must bid within that range or withdraw — they cannot skip rounds.
A bid at the top of the round’s range is a “continue bid” that sees the applicant through to the next round. Lower, and it’s an “exit bid” that will count as a withdrawal if anyone else submits a higher bid.
When all but one applicants have withdrawn, the remaining applicant gets the gTLD, paying ICANN an amount equal to the highest exit bid submitted by a competitor in that round.
Unlike the private auctions that have been taking place for the last few months, losing applicants walk away empty-handed apart from a small application fee refund from ICANN.
Applicants’ bidding limits will be determined by their deposits. If your deposit is under $2 million, your bid ceiling is 10x your deposit, but if you put down $2 million deposit or more, there would be no upper limit.
It all seems fairly straightforward for direct, single-string contention sets.
Where it starts to get fuzzy is when you start thinking about “indirect” contention and multiple, connected auctions running simultaneously.
It’s a little tricky to explain indirect contention without diagrams, but let’s try an example, using .shop, instead.
There are nine applicants for .shop. These are all in direct contention with each other.
But one .shop applicant, Commercial Connect, won objections against applicants for “similar” strings — Amazon’s .通販 and Donuts’ .shopping.
Assuming ICANN upholds these objection findings, which seems increasingly likely given recent statements from generic domains president Akram Atallah, both .shopping and .通販 will be in direct contention with Commercial Connect’s .shop and in indirect contention with all the other .shop applications.
Complicating matters, while Amazon’s .通販 is uncontested, Donuts’ .shopping is also in direct contention with Uniregistry, which applied for the same string but did not lose an objection.
It will be quite possible for .shop, .shopping and .通販 to all be delegated, but only if Commercial Connect loses the auction for .shop or otherwise withdraws from the race.
The auction materials published by ICANN today are a bit fuzzy on what happens when indirect contention is in play. On the one hand it suggests that multiple applications can win an auction:
When a sufficient number of applications have exited the auction process, so that the remaining application(s) are no longer in contention with one another, and all the relevant string(s) can be delegated as gTLDs, the auction will be deemed concluded.
But the rules also say:
the rules set forth within this document will assume that there is direct contention only, a condition that holds for the substantial majority of Auctions. In the event that an Auction will include a Contention Set that does not satisfy this condition, ICANN or the Auction Manager may issue an Addendum to the Auction Rules to address indirect contention.
While it seems that the auctions for .shop, .shopping and .通販 would have to take place simultaneously due to the indirect contention, some weird edge cases have me confused.
ICANN’s list of indirect contention sets is currently empty.
It’s not at all clear to me yet whether, for example, Donuts’ .shopping application would be placed in the .shop auction or whether two separate auctions would be conducted.
That could be important because deposits — and therefore bidding limits — are specific to each auction.
Would Donuts have to stump up $4 million in deposits, rather than $2 million, just in order to win one string? Would Commercial Connect have to put down $6 million for three auctions for one string?
If the two .shopping applicants are placed in the .shop auction, and Commercial Connect withdraws first, would Donuts have to carry on bidding against the other eight .shop applicants, just to win .shopping?
I’m guessing not, but the rules don’t seem to envisage this scenario yet.
What about Uniregistry, which has an application for .shopping? Will ICANN force it into the .shop auction even though it’s not in direct contention with any .shop applicant?
If .shop and .shopping are two separate auctions, what happens if Commercial Connect withdraws from the .shop auction but not the .shopping auction? It would have little to gain — not being a .shopping applicant — but could it artificially bid up the .shopping set?
And could how these auctions play out have an impact on companies’ objection strategies in future rounds?
If Uniregistry, say, finds itself at a disadvantage because its .shopping competitor Donuts was objected to by Commercial Connect, maybe it would make sense for an entire direct contention set to cooperate to fight off an objection from an applicant for a similar string.
And if Commercial Connect finds itself financially hobbled by having to participate in three auctions rather than one, maybe that will discourage applicants from filing massive amounts of objections in future.
And another thing…
If you’re as confused as I am, ICANN is running a webinar November 7 at 2200 UTC in order to answer (hopefully) these kinds of questions.
New gTLD applicants have reportedly complained to ICANN about the unexpectedly high cost of dealing with objections.
The International Chamber of Commerce has apparently been quoting objectors prices as high as €150,000 for a three-person panel to handle a formal community objection.
At $195,000, that’s almost $10,000 more than the original ICANN application fee.
Because Community Objections run on a loser-pays basis, the stakes are high indeed. An applicant could lose its application, most of its application fee, and still have to pay the objector’s fees.
The complaints emerged during a session with ICANN new gTLD program head Christine Willett at a meeting in Brussels earlier this week, according to consultant and occasional DI contributor Stephane Van Gelder.
Writing on the NetNames blog yesterday, Van Gelder quoted Willett as saying:
We are aware that ICC fees are more than people were expecting. Some applicants have been quoted around 50,000 Euros for a one expert panel and 150,000 Euros for a three expert panel. Although in the same order of magnitude as the cost estimate listed in the applicant guidebook, they are still higher. In some cases, significantly higher. In fact, we had one applicant write to us last week saying that their quoted expert fee was more than the ICANN fees for submitting their application in the first place! So we have reached out to ICC and are hoping they can provide some rationale for the costs they are quoting.
The Applicant Guidebook does not detail the fees charged by dispute resolution providers, but materials provided by the ICC (pdf) say that its admin costs are €12,000 and €17,000 for a one-person and three-person panel respectively. The hourly rate for the panelists is €450, it says.
With a €150,000 total cost, back of the envelope doodling suggests that each panelist expects to spend around 100 hours working on each case — over two weeks at seven hours a day.
By contrast, the World Intellectual Property Organization’s fees for handling Legal Rights Objections with a three-person panel start at $23,000 ($3,000 for WIPO, $20,000 for the panelists).
dotgay LLC could be hit by another formal new gTLD objection from gay Republicans.
ICANN Ombudsman Chris LaHatte today said that it was “unfair” that a community objection filed by GOProud, a gay lobby group, was rejected by the International Chamber of Commerce.
The ICC screwed up, it seems, judging by LaHatte’s decision.
Washington DC-based GOProud, which seeks to show that not all gay rights advocates have liberal views on other issues, had filed a community-based objection to dotgay’s .gay gTLD application.
While the substance of the objection is not known, I suspect it’s politically motivated. The other objection to dotgay’s application was filed by another gay Republican organization, the Metroplex Republicans of Dallas (formerly Log Cabin Republicans Dallas).
The ICC rejected the objection because it was about 500 words over the prescribed limit, but it sent the notification to the wrong email address, according to LaHatte’s blog.
Had GOProud received the notification, it would have had time to amend its objection to rectify the mistake. However, by the time it discovered the problem the filing deadline had passed.
there is some unfairness in the subsequent rejection given the apparent error in the use of the wrong email. It seems to me that it would be relatively easy to unwind that decision, and permit the late filing of the objection. I can of course only make a recommendation, but in this case where there is some unfairness I think the matter should be revisited.
The Ombudsman’s role is to handle complaints about unfairness in ICANN’s actions, so it’s not entirely clear what’s going to happen in this case, given that the ICC is an ICANN subcontractor.
LaHatte’s recommendation is certainly not binding in either case. Whether the ICC changes its mind may depend on whether ICANN asks it to or not.
dotgay is the New York-based applicant founded by Scott Seitz. It’s one of four companies applying for .gay.
The other three applicants — Top Level Domain Holdings, Top Level Design and Demand Media — have each received community objections from the International Lesbian Gay Bisexual Trans and Intersex Association, a dotgay supporter.
ICANN Ombudsman Chris LaHatte has ruled that the decision to accept formal new gTLD objections sent one minute after the filing deadline “does not create unfairness”.
The decision is a blow to at least one applicant, which had tried to have an objection against it kicked out for being late.
LaHatte received a complaint from the applicant, believed to be represented by Galway Strategy Group’s Jim Prendergast, last month.
The complainant said that an objection by a competing applicant was sent at 00:01:02 UTC on March 15, one minute and three seconds after the deadline laid out in ICANN’s Applicant Guidebook.
But the dispute resolution providers hired by ICANN to manage objections decided to give a little leeway, agreeing among themselves (with ICANN’s tacit consent) to a five-minute extension.
Now LaHatte has decided — entirely reasonably in my view — that this was not unfair.
He wrote: “It is my view that a five minute window is a proportionate response and does not create unfairness for the applicants, but does provide fairness given that it is only five minutes.”
He added that at least one other objection, which was filed much later, was rejected for its tardiness.