Overstock.com slows down O.co rebranding

Overstock.com is throttling its transition to the O.co brand after discovering consumers typed o.com even after watching the company’s commercials, according to a report.
The company’s $350,000 purchase of and subsequent rebranding around the o.co domain was possibly the single biggest single marketing coup for .CO Internet, the .co registry, to date.
But now it intends to keep the Overstock.com brand in the US for the time being, while using O.co overseas and on a new iPad app, according to a report in AdAge.
The O.co Coliseum, the stadium in Oakland for which Overstock bought the naming rights, will continue to bear the O.co name.
AdAge quoted Overstock president Jonathon Johnson saying that “a good portion” of people viewing its commercials tried to visit o.com, which is a non-resolving registry-reserved name, instead.
“We were going too fast and people were confused, which told us we didn’t do a good job,” he told AdAge. “We’re still focused on getting to O.co, just at a slower pace… We’re not flipping back, we’re just refocusing.”
This is obviously bad news for commercial new top-level domain applicants, many of which will be looking for all-important anchor tenants to validate their brands at launch.
Marketing people like to refer to the measurable results of others before pulling the trigger on new initiatives. The O.co case is unlikely to create enthusiasm for new TLDs.
On the other hand, it’s commonly believed that when it comes to breaking the .com mindset in the US, it will take more than a trickle of new TLDs such as .co. It will take a flood.
.CO Internet has always taken the position that .co adoption will take time, and that the ICANN new gTLD program will help its cause by raising awareness of non-.com domains.

US puts ICANN contract up for rebid

The US government has put the IANA contract, which currently gives ICANN its powers to create new top-level domains, up for competitive bidding.
The National Telecommunications and Information Administration issued a request for proposals late yesterday, almost a week later than expected.
The Statement Of Work, which defines the IANA contractor’s responsibilities, is over twice at long as the current IANA contract, containing many deliverables and deadlines.
While the contract is open to bidders other than ICANN, ICANN is obviously the likely winner, so it’s fair to read the SOW in that context.
Notably, the section dealing with approving new gTLDs has been changed since the draft language released in June.
NTIA said previously that in order to delegate a new gTLD, ICANN/IANA “shall include documentation to demonstrate how the proposed string has received consensus support from relevant stakeholders and is supported by the global public interest.”
The new SOW has dropped the “consensus support” requirement and instead states:

The Contractor must provide documentation verifying that ICANN followed its policy framework including specific documentation demonstrating how the process provided the opportunity for input from relevant stakeholders and was supportive of the global public interest.

This could be read as a softening of the language. No longer will ICANN have to prove consensus – which is not a requirement of the Applicant Guidebook – in order to approve a new gTLD.
However, the fact that it will have to document how a new gTLD is “supportive of the global public interest” may give extra weight to Governmental Advisory Committee objections.
If the GAC were to issue advice stating that a new gTLD application was not in “the global public interest”, it may prove tricky for ICANN to provide documentation showing that it is.
The SOW also addresses conflicts of interest, which has become a big issue for ICANN following the departure of chairman and new gTLD proponent Peter Dengate Thrush, and his subsequent employment by new gTLD applicant Minds + Machines, this June.
The SOW says that IANA needs to have a written conflicts of interest policy, adding:

At a minimum, this policy must address what conflicts based on personal relationships or bias, financial conflicts of interest, possible direct or indirect financial gain from the Contractor’s policy decisions and employment and post-employment activities. The conflict of interest policy must include appropriate sanctions in case on non-compliance, including suspension, dismissal and other penalties.

Overall, the SOW is a substantial document, with a lot of detail.
There’s much more NTIA micromanagement than in the current IANA contract. Any hopes ICANN had that the relationship would become much more arms-length have been dashed.
The SOW includes a list of 17 deadlines for ICANN/IANA, mainly various types of compliance reports that must be filed annually. The NTIA clearly intends to keep IANA on a fairly tight leash.
You can download the RFP documents here.

Massive group forms to kill off new gTLDs

ICANN’s new nemesis is called CRIDO.
Eighty-seven companies and trade groups have formed the Coalition for Responsible Internet Domain Oversight, a lobby group set up to kill ICANN’s “deeply flawed” top-level domains program.
It’s led by the Association of National Advertisers, which emerged this August as a vocal opponent of new gTLDs and has spent the last few months recruiting allies.
Its new domain, crido.org, is registered to the ANA’s PR firm and currently redirects to the ANA’s gTLD microsite.
The new group said in a press release today:

On behalf of its many constituencies and industries, CRIDO is committed to aggressively fighting ICANN’s proposed program, citing its deeply flawed justification, excessive cost and harm to brand owners, likelihood of predatory cyber harm to consumers and failure to act in the public interest, a core requirement of its commitment to the U.S. Department of Commerce.
…
If the ICANN program proceeds, CRIDO firmly believes, the loss of trust in Internet transactions will be substantial. In addition, the for profit and non-profit brand community will suffer from billions of dollars in unnecessary expenditures – money that could be better invested in product improvements, capital expenditures and job creation.

CRIDO’s members comprise 47 trade associations, most but not all American, and 40 companies, many of them major household names such as Coca-Cola, Burger King and Kellogg.
Together, they have signed a petition to the Department of Commerce, ICANN’s overseer in the US government, asking it put a halt to the new gTLDs program
The questions now are whether Commerce will do anything concrete to address the demands and, if not, whether CRIDO will decide to put its lawyers where its mouth is instead.
Here’s a handy table of all CRIDO’s members.
[table id=3 /]

Registrar threatened with shutdown for failing to reveal registrant

ICANN has told a Turkish domain name registrar that its accreditation will be terminated unless it fixes its apparently shoddy Whois services.
While Alantron has a track record of Whois failures and connections to abusive domains, ICANN’s threat appears to have been made in connection with a single domain name.
ICANN compliance director Stacey Burnette wrote to Alantron (pdf):

On 12 October 2011, ICANN requested that Alantron make registration records available to ICANN concerning a specific domain name, as ICANN received a complaint that there was no Whois output available for the domain name. Although numerous requests were made by ICANN to make the registration records available for inspection and copying, as of the date of this letter, Alantron has not made any arrangements to comply with ICANN’s request.

The letter also details Alantron’s alleged failures to make Whois available through Port 43 and its web interface going back to September 1.
ICANN has also threatened to suspend Alantron’s ability to create new registrations. Alantron received a similar de-accreditation warning for Whois failures in April 2010.
It does not say who made the complaint or which domain is in question, but the company has come under fire from security pros in the past for allowing its services to be abused to push fake pharmaceuticals.
Alantron, which has about 26,000 domains under management according to Webhosting.info, has until November 25 to rectify the problem.

Companies that can’t apply for .brand gTLDs say they have decided not to apply for .brand gTLDs

Hewlett-Packard and Proctor & Gamble have ruled themselves out of applying to ICANN for .brand top-level domains, or so they claim.
Bloomberg yesterday reported a distinct lack of enthusiasm for new gTLDs from many large brands, leading with quotes from P&G and HP:

P&G, the world’s largest consumer products company with more than 50 brands including Tide detergent, Pampers diapers and Crest toothpaste, won’t apply for new suffixes, said Paul Fox, a spokesman. HP, the biggest computer maker, considers the program costly and has no plans to take part, said Gary Elliott, vice president of global marketing.
“A lot of companies are looking at the same math as we are and saying, ‘Let’s stop this proposal from happening,’” Elliott said in an interview. “There’s a tremendous amount of confusion about what this means and what the costs are.”

HP’s Elliot is chairman of the Association of National Advertisers, the most vocal opponent of the new gTLD program, as the Bloomberg report notes.
One fact the report doesn’t mention – and I’d bet Elliot didn’t volunteer – is that HP and P&G cannot apply for .hp or .pg due to ICANN’s strict three-character minimum for new gTLD strings.
HP had campaigned for ICANN to scrap the two-character prohibition for a number of years, though it usually also noted that in principle it was opposed to the program.
Nevertheless, it strikes me as disingenuous for the company to say it’s decided against a .brand on the basis of cost, when ICANN essentially made its decision for it years ago.
P&G, which mostly makes cosmetics and toiletries, has also ruled out applying for gTLDs to represent any of its 50 or so well-known brands, Bloomberg reported.
The internet will have to go without .tampax and .pampers for the foreseeable future.
General Motors, Wal-Mart, Adobe, Porsche, Vodafone and Puma are all generally negative on the program but are still evaluating their options, according to Bloomberg.
It’s quite possible that these outfits are just as opposed to the new gTLD program as HP and P&G.
But if they’ve been talking to consultants, they will also have been advised not to publicly talk about their applications. Nothing can be gained by going public before April 12.

Afilias to apply for Chinese .info

Afilias has announced that it plans to apply for the traditional and simplified Chinese script equivalents of .info under ICANN’s new generic top-level domains program.
The company becomes the last of the Big Three registries to give a glimpse into its new gTLD strategy.
VeriSign has said it wants transliterations of .com in multiple scripts, while Neustar has said it plans to apply for its own dot-brand, .neustar.
Afilias did not disclose the exact strings it wants in its announcement. There was no mention of .mobi, which the company also runs.
According to the last official count, there are close to 7.9 million registered .info domains. Marketing director Roland LaPlante said in September that about 19% host unique web sites.

CADNA calls for second new gTLDs round in 2012

The Coalition Against Domain Name Abuse wants ICANN to name the date for its second new top-level domains application round, and suggested that it could come as early as one year from now.
President Josh Bourne told DI that the lobbyist, a long-time opponent of new gTLDs, has “switched gears”, taking a more pragmatic position since the program was approved in June.
“It’s not just about big companies at this point,” he said. “We’ve got hundreds of entrepreneurs and governments planning to apply for a range of gTLDs, – .wales, .london, .paris, .health, .green, .eco…”
“It’s not just about brands, so to cancel the policy now, that’s just never going to happen,” he said.
Bourne said that CADNA’s policy shift created a vacuum of opposition that was quickly filled by groups such as the Association of National Advertisers, which is now loudly demanding that the program be killed off or delayed indefinitely.
CADNA is not aligned with the ANA. Instead, it intends to write to ICANN soon to ask it to start planning for the second round already, saying this would help relieve the pressure on businesses.
“The best thing they could do for businesses and other applicants like entrepreneurs is to say ‘We’ve got the first round planned for January 12 to April 12, we’re going to tell the world right now that we’re going to have a vote in Costa Rica in March to approve a plan to have the second round in the fall of 2012’,” Bourne said.
He admitted that he doesn’t know if late 2012 is feasible – ICANN expects to still be early in the evaluation process for the first round at that time – but suggested that the windfall from first-round fees will be sufficient to ramp up bandwidth.
The lack of a second-round date is forcing companies to act quickly on new gTLDs with no idea whether they really want or need them. No company wants to be left behind for years or perhaps forever if their competitors are successfully exploiting their new gTLDs.
“People in businesses thinking of applying mainly do so not because they have a grand scheme, it’s because they’re scared,” he said.
“For the most part they’re getting accustomed to the notion that they’re buying an option, the right to use it in 2013 if other companies are using them,” he added.
The reason ICANN has not yet said when a second round will be offered is its commitment to review the impact of the first round before accepting any more applications.
The Applicant Guidebook currently states:

ICANN has committed to reviewing the effects of the New gTLD Program on the operations of the root zone system after the first application round, and will defer the delegations in a second application round until it is determined that the delegations resulting from the first round did not jeopardize root zone system security or stability.

That paragraph was added in April, following consultations between ICANN and its Governmental Advisory Committee, which based its demands on ICANN’s Affirmation of Commitments.
The AoC, which was based in part on feedback from businesses and IP interests, also calls for a more substantial review of the program, taking into account consumer choice and abuse.

GAC new gTLD veto refuses to die

ICANN’s Governmental Advisory Committee seems to be trying yet again to resurrect the government right of veto over controversial new top-level domain applications.
The GAC has proposed changes to the new gTLDs Applicant Guidebook that – at least on the face of it – would remove ICANN’s power to overrule GAC objections.
The changes would also make it much more likely that a gTLD application could be killed off due to the objections of a single nation.
If adopted, they would also make the already unpredictable process of anticipating the result of GAC objections considerably more ambiguous.
The supposedly “complete” Guidebook published by ICANN last month currently includes a warning that the GAC is working on its objecting rules, and that these will be included in future.
The GAC Communique (pdf) issued at the ICANN meeting in Dakar on Friday includes these proposed rules as an annex, and they’re not great if you’re a likely new gTLD applicant.
Consensus objections
If the GAC issues a consensus objection to an application, the Guidebook currently states that a “strong presumption” would be created that the application should fail.
But ICANN’s board would be able to overrule it with a so-called “Bylaws consultation”, the same process it used to approve .xxx earlier this year.
In its proposed revisions, the GAC inexplicably wants to delete the references to the Bylaws consultation.
My understanding is that the GAC is not proposing a change to the Bylaws, so the right of the board to initiate a consultation and overrule a GAC objection would still exist.
But the GAC seems to be asking for applicants to be given far less information about that process than they need, making its own powers appear greater than they are.
This could raise the psychological barrier to initiating a Bylaws consultation and create the perception that a consensus GAC objection always kills an application, which may not be the case.
The Dakar communique defines GAC consensus as “the practice of adopting decisions by general agreement in the absence of any formal objection”, which creates its own set of worries.
Non-consensus objections
A much bigger change is proposed to the way ICANN handles GAC “concerns” about an application.
This is GAC code for a non-consensus objection, where one or more governments has a problem with an application but the GAC as a whole cannot agree to object.
This is the objection mechanism that will very likely capture applications for gTLDs such as .gay, but it could basically cover any string for any reason.
Using the Guidebook’s current wording, there would be no presumption that this kind of application should be rejected. It would be in ICANN’s discretion to initiate a Bylaws consultation.
But the GAC wants something that sounds rather a lot like a Bylaws consultation made mandatory.
“The ICANN Board is expected to enter into dialogue with the GAC to understand the scope of concerns,” it says. “The ICANN Board is also expected to provide a rationale for its decision.”
This basically means that an application for .gay that was objected to by just two or three governments would have to undergo the pretty much the same level of scrutiny as .xxx did.
The political pressure on ICANN to kill the application would be much more intense than it would under the Guidebook’s current rules.
Here’s a table of the GAC’s proposed changes.
[table id=2 /]
In summary, the GAC wants to give more weight to fringe objections and to make the whole process potentially much more confusing for applicants.
I can’t see ICANN sensibly adding the GAC’s text to the Guidebook without at the very least some edits for clarity.

Today’s new gTLDs decisions in full

ICANN’s board of directors passed two resolutions relating to new generic top-level domains at is meeting in Dakar, Senegal today.
While neither is particularly Earth-shattering, they are notable and therefore reproduced here in full.
The first relates to financial support for new gTLD applicants from developing nations.
ICANN has not figured out how to implement the recommendations of the JAS working group yet, but it hopes to do so before the end of the year.

Joint Applicant Support
Whereas, the Board has received the Final Report of the Joint Applicant Support Working Group (JAS WG), appreciates the work of the JAS WG created in April 2010 by the ALAC and GNSO, and thanks the entire ICANN community for the constructive dialogue leading up to and during this week in Dakar.
Whereas, the Board expresses its appreciation to the GAC and ALAC for their joint statement on the JAS WG report.
Whereas, the Board is committed to ensuring that the implementation of a support program for deserving applicants will be done in a manner to enable those applicants to effectively participate in and benefit from the first round of the New gTLD Program.
Resolved (2011.10.28.21), the Board takes the JAS WG Final Report seriously, and a working group of Board members has been convened to oversee the scoping and implementation of the recommendations arising out of that Report, as feasible.
Resolved (2011.10.28.22), the President and CEO is expected to commence work immediately and provide a detailed plan for consideration. If the plan is complete sufficiently in advance of its next scheduled Board Meeting set for 8 December 2011, the Board will seek to add a special meeting to its schedule prior to that date.
Rationale for Resolutions 2011.10.28.21 – 2011.10.28.22
In Singapore, the Board resolved that it would consider the report and recommendations of the Joint Applicant Support Working Group. The Board takes seriously the assertions of the ICANN community that applicant support will encourage diverse participation in the New gTLD Program and promote ICANN’s goal of broadening the scope of the multi-stakeholder model. In its deliberations, the Board is balancing its fiscal responsibility in launching the New gTLD Program, the desire to provide a support program in the first round, and the time required to obtain additional funding. While the Board solution is not complete, there is a vision for accomplishing each of those three goals.  As required for assessment within the Affirmation of Commitments, there is no security and stability impact on the DNS. Part of the further work required through this resolution will assess the affect of this work; however there is no affect on ICANN’s fiscal resources as a result of this immediate action.

The second resolution, which caused considerable debate among board members, relates to funding of the much-criticized new gTLDs communications campaign.
The board approved an additional $900,000 for outreach, much of which will apparently go into the pockets of newly hired PR firm Burson-Marsteller.

Budget Request – New gTLD Communications Plan
Whereas, at the Paris ICANN meeting in 2008, the Board adopted the GNSO policy recommendations to introduce new Generic Top-Level Domains (new gTLDs), including at least a four-month communications period to raise global awareness.
Whereas, the Draft New gTLD Communications Plan (link) describes the global outreach and education activities that will be conducted in each of the ICANN geographic regions.
Whereas, the FY 12 budget allocates US $805,000 to fund this effort.
Whereas, planning and subsequent execution of the Communications Plan has indicated the need for a full service global public relations firm to ensure ICANN effectiveness in this effort.
Whereas, funds can be re-allocated in the adopted ICANN Budget to support the augmented communications effort without materially affecting performance in other areas.
Whereas, at its 22 October 2011 meeting the Board Finance Committee approved a recommendation that the Board approve an additional expenditure of US$900,000 for the execution of the Communications Plan.
Resolved (2011.10.28.23), the Board approves an additional expenditure of up to US $900,000 for the remaining three months of the Communications Plan, to be used for the retention of Burson-Marsteller, a global public relations firm, to work towards the goal of raising global awareness of new Generic Top Levels Domains consistent with the terms of the Communications Plan.
Resolved (2011.10.28.24), the Board authorizes the President and CEO to enter into any contracts necessary to fulfill the objectives of the New gTLD Communications Plan to the extent those contracts do not exceed the budget for the Communications Plan.
Rationale for Resolution 2011.10.28.23 – 2011.10.28.24
The budget for the Board-mandated new gTLD communications program is currently US $805,000. That figure was based on an earlier draft communications plan.
The current plan is more expansive and ambitious. It is based on the premise that every potential applicant should be aware of the program’s opportunities and risks, and thus it is aimed at building maximum awareness through multiple communications channels. It also focuses more strongly on developing countries.
The Plan is built on four principal efforts:
1. Regional “road shows” and public events;
2. Earned media – broadcast, online and print;
3. Social media; and
4. Global information through paid advertising, and multiplying these efforts through the community.
The New gTLD Communications Plan is neutral in its presentation. ICANN is not promoting applications for new gTLDs or advocating that any organization apply for one. Rather, ICANN is providing essential information and raising awareness of the New gTLD Program.
The current efforts limited in scope. ICANN has determined that retaining a full-service worldwide public relations firm to further coordinate ICANN’s efforts will assure that ICANN is able to attain the goal of the New gTLD Communications Plan.
ICANN has identified a well-respected global public relations firm, Burson-Marsteller, that can provide a broad range of awareness-raising services. ICANN will have access to the firm’s extensive network with an established presence in 91 countries, over 40 of them developing nations. These local and regional assets are invaluable. ICANN also will benefit from the firm’s expertise in digital and social media. ICANN will retain editorial control over all implementation aspects of the New gTLD Communications Plan.
Securing a global public relations firm of this caliber will contribute greatly toward ensuring success of the New gTLD Communications Plan. And as the first deliverable of the New gTLD Program, success of the New gTLD Communications Plan is critical.
Approval of this resolution will positively affect ICANN’s accountability and transparency by globally maximizing the spread of information about ICANN itself. This action will have no effect on the security, stability and resiliency of the domain name system.
The New gTLD Communications Plan will be conducted within the existing ICANN budget. This effort will be funded out of contingency funds, so the expenditure will not affect ICANN’s ability to perform and accomplish its other goals and objectives.

More later.

New gTLD risk fund rubbished by .brand advocate

Proposals to change the way new top-level domains are insured against failure will put the whole new gTLD program at risk, according to an intellectual property lawyer.
Speaking at a session at the ICANN meeting in Dakar today, Paul McGrady of the law firm Greenberg Traurig said the changes could even lead to a lawsuit that would delay the January 2012 launch of the program by at least a couple of years.
The debate was sparked by a proposal from the registries to restructure the Continued Operations Instrument, a financial backup designed to fund gTLD operations after their businesses fail.
ICANN currently plans to ask each applicant to submit a COI sufficient to cover the cost of running their own gTLD for three years in the form of cash in escrow or a letter of credit.
But the registry proposal calls instead for a Continued Operations Fund that would pool the risk between applicants, with each applicant paying just $50,000 up-front.
While the COI implicitly assumes that all new gTLDs could crash and burn, the COF assumes that only a small number of businesses will fail, as I reported earlier this month.
But McGrady, apparently speaking for the Intellectual Property Constituency, gave a startlingly different interpretation of the COF, from the “.brand” applicant perspective.
A .brand applicant can secure a letter of credit sufficient to cover the COI for as little as $2,000, he said. A $50,000 payment to the COF would dramatically increase its costs, he said.
“That money is taken from the .brand applicant and given to the shaky start-ups that shouldn’t be applying anyway,” he said. “It’s a redistribution of wealth.”
“If you can’t meet the [Applicant] Guidebook’s current requirements, you are dramatically under-capitalized,” he said. “Don’t apply.”
He said that if ICANN decides to add the $50,000 cost before January, it’s likely that some of those brands that oppose the program anyway will use it as an excuse to sue for delay.
“If the ICANN community would like to tee up for a litigation issue which could bring round one to a halt before it opens, this is it,” he said.
He further said that any back-end registry services providers targeting .brand clients had better distance themselves from the COF proposal if they want to get that business.
“Anyone in the room with a vested interested in this process moving forward, this is not the issue to back,” he said.
While the specific proposal up for debate was drafted by the Public Interest Registry and Afilias, the concept of a COF is has the backing of the ICANN registry stakeholder group.
As far as FUD goes, McGrady’s presentation was pretty blatant stuff, but that does not necessarily mean it’s not true.
His tone seemed to cause some consternation in the room.
Likely applicant Ron Andruff said that McGrady was employing a “scare tactic about how things might get delayed because big corporations don’t want to park money”.
Several others pointed out that smaller community applicants and applicants from certain countries may be unable to secure a letter of credit as easily as a large brand applicant.
Those applicants would have to put cash in escrow, tying it up and making it harder to market their gTLDs… thus leading to a greater chance of failure.
But McGrady stuck to his “redistribution of wealth” line.
“What we’re talking about is a last-minute change to the Guidebook to benefit applicants that don’t have sufficient funds,” he said.
He was not alone speaking out against the COF idea.
Richard Tindal of likely gTLD applicant Donuts said that many projections about new gTLDs are being made by a small number of registries that are making similar assumptions.
If these assumptions turn out to be flawed, the risk of gTLD failures could be bigger than expected.
“If a hurricane hits a house in the street, it’s going to hit all the houses in the street,” he said.
The COF/COI debate is open for public comment until December 2.