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Mystery gTLD applicant to take Google fight to lawmakers

Kevin Murphy, February 13, 2013, Domain Policy

An as-yet unidentified new gTLD applicant plans to lobby Washington DC and Brussels hard to get dozens of Google’s new gTLD bids thrown out of ICANN on competition grounds.

Phil Corwin of the law firm Virtuallaw, who is representing this applicant, told DI yesterday that his client believes Google plans to use new gTLDs to choke off competition in the web search market.

“They’re trying to use the TLD program to enhance their own dominance and exclude potential competitors,” Corwin said. “We think this should be looked at now because once these TLDs are delegated the delegations are basically forever.”

He’s planning to take these concerns to “policy makers and regulators” in the US and Europe, in a concerted campaign likely to kick off towards the end of the month (his client’s identity will be revealed at that time, he assured us).

Corwin’s client — which is in at least one contention set with Google, though in none with Amazon — reckons ICANN’s new gTLD program is ill-suited to pick the best candidate to run a gTLD.

If objections to new gTLD applications fail, the last-resort method for deciding the winner of a contention set is auction. Google obviously has the resources to win any auction it finds itself in.

“On any TLD Google has applied for, nobody can beat them,” said Corwin. “They have $50bn cash, plus the value of their stock. If they want any of the TLDs they’ve applied for, they get them.”

“A string contention process that relies solely on an auction clearly favors the deep-pocketed,” he said.

Google applied for 101 new gTLDs, 98 of which remain in play today. A small handful of the strings are dot-brands (such as .youtube and .google), with the majority comprising dictionary words and abbreviations.

Some of its generic bids propose open business models, while others would have “closed” or single-registrant business models. As we reported on Friday, this has kicked off a firestorm in the ICANN community.

Corwin said that Google appears to be planning to close off not only individual TLDs, but entire categories of TLDs.

For example, Google has applied for .youtube as a brand, but it’s also applied for .film, .movie, .mov, .live, .show and .tube with a variety of proposed business models.

“You can pretty well bet that they’ll exclude those that will pose a competitive threat to YouTube,” Corwin said.

Search will become much more important after the launch of hundreds of new gTLDs, Corwin reckons, as consumers are “not going to know that most of them exist”.

“Generic words are the perfect platform for constructing vertical search engines that can compete against Google’s general search engine,” Corwin said.

“Google is trying to buy up not just one but multiple terms that cover the same goods and services in key areas of internet commerce, and in effect control them so competition cannot arise and challenge Google’s dominance as a search engine,” he said.

Google has not yet revealed in any meaningful way how its search engine will handle new gTLDs.

The US Federal Trade Commission, at the conclusion of an antitrust investigation, recently gave Google a pass for its practice of prominently displaying results from its own services on results pages.

With that in mind, if Google were to win its contention set for .movie, but not for .film, is it possible that .movie would get a competitive advantage from preferential treatment in search?

Corwin reckons that Google anti-competitive intentions are already suggested by its strategy in ICANN’s new gTLD prioritization draw, which took place in December.

Of the roughly 150 applications for which Draw tickets were not purchased, Google is behind 24 of them — including .movie, .music, .tube and .search — 22 of which are in contention sets.

As a result, these contention sets have all been shunted to the back of ICANN’s application processing queue, adding many months to time-to-market and costing rival, less-well-funded applicants a lot of money in ongoing overheads.

“We see Google playing a rather different game here to most other applicants in terms of their motivation, which is not to enter the market but to protect their market dominance,” Corwin said.

Corwin said the game plan is to taken all these concerns to policy makers and regulators in the US and Europe in order to get governments on-side, both inside and outside of the ICANN process.

Corwin is also counsel and front-man for domainer group the Internet Commerce Association, but he said that the new anti-Google drive is unrelated to his work for ICA.

So why is his client only bringing up the issue now? After all, we’ve all known about the contents of every new gTLD application since last June.

My hunch is that Google is playing hard-ball behind the scenes in settlement talks with contention set rivals.

Contention sets can be resolved only when all but one of the applicants drops out, either following an ICANN auction or private buy-outs. Most applicants favor private resolution because it offers them the chance to recoup some, all, or more than the money they splashed out on applying.

That game plan probably does not apply to Google, of course, which is not wanting of funds. The company may even have good reason to prefer ICANN auctions, in order to to discourage those who would apply for new gTLDs in future just in order to put their hands in Google’s pockets.

The topic of closed generics and competition is likely to be a hot-button topic at ICANN’s next public meeting, coming up in Beijing this April.

Members of ICANN’s Governmental Advisory Committee have already expressed some concerns about many “closed gTLD” applications made by Google, Amazon and others.

ICANN’s board of directors is currently mulling over what to do about the issue, and has thrown it open to public comment for your feedback.