What's in a Domain Name? The Changing Internet

That has now changed. Last June, ICANN reversed its long-held position and announced that it would allow an unlimited number of generic top-level domains.

The genesis for the change may reside in a 2005 report on the Internet from the National Academy of Sciences. The report addressed the technical feasibility of greatly expanding the number of registrations of gTLDs. The academy focused particularly on the ability of the servers that make the Internet possible to withstand an increase in the number of gTLDs. It concluded that the servers could easily handle the greater demand, pointing out that the .com gTLD alone was easily processing the 20 billion queries it received daily.

According to ICANN, its decision to open up the domain name space will lead to greater competition and lower costs for the public when registering domain names. Additionally, the well-known gTLDs are crowded. Every word in the English language and every letter combination between two and five letters in length, for instance, have been registered as a domain name under the .com gTLD.

The cost of applying for a new gTLD guarantees that there will not be a stampede of new applicants. ICANN has tentatively set the fee for a gTLD application at a steep and non-refundable $185,000. Once registered, a gTLD will also carry an annual maintenance fee of at least at $75,000. ICANN has stated that it believes the high fees to be necessary for it to recoup the $12 million already spent implementing the open gTLD system.

The fees will probably decline in time, and smaller businesses will then be able to obtain their own gTLDs. Lower fees, however, will carry a downside as well. There may emerge the kind of frenzied speculation for gTLDs that occurred in the 1990s in connection with domain names. In addition, abusers of the current Internet domain-name regime will be able translate their illicit behavior to the new gTLD space.

Cost Will Prevent Misuse

For so long as the fees for a gTLD application remain high, however, there should be few abuses occurring, such as cybersquatting, typosquatting and domain tasting.

Typosquatters register misspellings of popular domain names as their own domain names. Web users who expect to land on the popular domain name's Web site, but who unintentionally misspell the domain name, are directed instead to the typosquatter's Web site. Undoubtedly, the somewhat greater complexity of domain names in which both the gTLD and the sub-domain are less familiar than “.com” will lead to a greater number of mistyped domain names, benefiting typosquatters.

Domain name tasting takes advantage of the five-day trial period that a registrant of a new domain name receives. During the five-day trial period, the prospective registrant can test the domain name for its profitability on a pay-per-click basis. If profitable, the tester simply retains the domain name. If not profitable, the tester relinquishes the domain name at the end of the five days and receives a full refund of the registration fee.

This inventory of potential ways in which gTLDs can be misused underscores the need for gTLD owners to obtain a trademark or service mark registration for their gTLD from at least one national trademark office, such as the U.S. Patent and Trademark Office. A registration serves as a governmental imprimatur of a trademark owner's claim to rights embodied in a registration. It carries considerable weight in dispute resolution proceedings against Internet abusers of the registered mark.

The appeal to businesses of owning their own gTLDs lies in the ability it provides to use the company name or one of their brands in place of .com or .net. If Amazon.com, for instance, were to obtain .amazon as its gTLD, it could use the sub-domain portion of the .amazon gTLD as a directory to its Web site. The domain names book.amazon and dvd.amazon, for example, could direct Web browsers to the book and DVD sections of its Web site, respectively.

Improved Search Results

Ownership of a popular gTLD could also benefit the placement in search results of Web sites operated under the gTLD. A search engine's algorithm might weigh the number of hits that a gTLD receives in its assessment of the relevance of a Web site to a query.

Marketers may find that a gTLD permits greater emphasis of a name or brand. Businesses that own their own gTLDs will be able to identify all of their business functions under a single gTLD. Additionally, in the sub-domain portion, a business will be able to customize content for its community, such as for employees, vendors, customers and the like.

Owners of gTLDs will also have greater assurance that security measures for the gTLD are adequate. They will have complete control over those safeguards in place for protecting against Internet threats.

The availability of new gTLDs, may also offer the chance to obtain a gTLD to those who were foreclosed from registering a name or mark under the .com gTLD.

Registering a New Domain

In October, ICANN issued a draft manual of procedure for processing gTLD applications.

ICANN is expected to open a 45-day window in the first quarter of this year for submitting applications for gTLDs. The first round of gTLD registrations are expected to be granted in the second quarter. Individuals are not eligible to own gTLDs.

Processing of an application for a new gTLD will begin with a comparison of the applied for gTLD with other applications and registrations. The comparison will be conducted by both a computer algorithm and by a human.

The applicant itself will also be assessed. A successful applicant for a gTLD must show that it has the financial, technical and operational capability to deploy a gTLD. An entity that meets these requirements and obtains its own gTLD is referred to as a registry. As a registry, the owner of a gTLD oversees the maintenance of the authoritative master database of all domain names registered under the registry's gTLD. A registry is also responsible for ensuring that computers anywhere in the world can route traffic to and from the registry's gTLD.

The U.S.-based company VeriSign Inc., for instance, is the registry for .com.

The gTLDs granted under the new policy will fall into one of two categories: “open” and “community-based.” Open gTLDs will be available for any purpose. Community-based gTLDs will be operated only for the benefit of groups, consisting of a defined community with a restricted population. To qualify for a community gTLD, the community must be clearly identified and organized in an established community; the gTLD must be endorsed by the community; there must be a connection between the gTLD and the community; and the applicant for the gTLD must establish a registration and use policy.

Geographical gTLDs include any word or combination of letters that represent a country or territory name; a subnational jurisdiction such as a county, province or state; a city name; or a continent or any U.N. region. Geographical name gTLDs permit a Web user to narrow his or her search results for a particular product or service to a locality of interest.

Geographical names or abbreviations, such as .london, .philly, and .dc are likely to face strong demand from applicants. ICANN intends to resolve competing claims for geographical names by requiring each applicant to prove its authorization to register the geographical name as a gTLD. Applicants will need to show support, or at least the absence of an objection by the relevant government or public authority, for the name.

Not Universally Welcomed

This change to an unlimited number of gTLDs is not universally applauded. For some, the new gTLDs may simply add to the difficulty of browsing the Web. They may more easily remember a domain name under the familiar .com or .net gTLDs than under a welter of different gTLDs.

Additionally, a .com gTLD is more likely to land a user directly on a home page, while a gTLD and its sub-domain name may lead to an internal page of a Web site which the Web user did not intend to visit.

The potentially limitless number of gTLDs will also hobble the ability of trademark owners to pre-emptively register domain names, in order to deny them to cybersquatters. Under the current scheme where there is only a limited number of gTLDs, a trademark owner can register an important trademark across the major gTLDs. For example, Acme Tools might pre-emptively register acmetools.com, acmetools.biz, acmetools.net and so on.

With unlimited gTLDs, pre-emptive domain name registration will be much less effective, if feasible at all. Instead, in place of across the board pre-emptive domain name registrations, trademark owners will need to systematically monitor the Web and gTLDs to detect improper use of their names and brands.

The format adopted for resolving gTLD disputes closely resembles the Uniform Dispute Resolution Policy, which is familiar to many trademark owners. Any party with standing to object, as defined by the manual of procedure, can do so. An objection can be based on a conflict with the objector's own gTLD, on a conflict with the objector's legal rights, on the grounds of morality and public order, or on the fact that a community gTLD is non-representative.

Objections based on morality and public order will inevitably lead to questions as to whose standards should apply and who has standing to raise an objection. Potential applications for .xxx as a gTLD from purveyors of adult entertainment or for .free from a Chinese democracy movement, raise standing and subject matter issues emblematic of the difficulties that enforcing the morality and public order criteria will face.

Where multiple applicants apply for an identical or similar gTLD, all applications that pass the evaluation process will be resolved by comparative evaluation or auction.

Conclusion

The availability of new gTLDs will change the way Internet traffic is managed, conflicts are processed, companies conduct their marketing and trademark owners protect their rights. Whether the value of a gTLD proves to be commensurate with its cost will remain unanswered for at least several years.

Generic, top-level domain names (gTLDs), such as .com or .net, are the sorters of the Internet. They serve the single purpose of identifying the database in which a domain name is registered.

The Internet Corporation for Assigned Names and Numbers (“ICANN”) is the nonprofit corporation that oversees the distribution of domain names. In the 10 years since ICANN's inception, it has permitted the number of gTLDs to grow to 21. ICANN believed that creating additional gTLDs risked confusing users of the Internet.

Make Your Own Domain

That has now changed. Last June, ICANN reversed its long-held position and announced that it would allow an unlimited number of generic top-level domains.

The genesis for the change may reside in a 2005 report on the Internet from the National Academy of Sciences. The report addressed the technical feasibility of greatly expanding the number of registrations of gTLDs. The academy focused particularly on the ability of the servers that make the Internet possible to withstand an increase in the number of gTLDs. It concluded that the servers could easily handle the greater demand, pointing out that the .com gTLD alone was easily processing the 20 billion queries it received daily.

According to ICANN, its decision to open up the domain name space will lead to greater competition and lower costs for the public when registering domain names. Additionally, the well-known gTLDs are crowded. Every word in the English language and every letter combination between two and five letters in length, for instance, have been registered as a domain name under the .com gTLD.

The cost of applying for a new gTLD guarantees that there will not be a stampede of new applicants. ICANN has tentatively set the fee for a gTLD application at a steep and non-refundable $185,000. Once registered, a gTLD will also carry an annual maintenance fee of at least at $75,000. ICANN has stated that it believes the high fees to be necessary for it to recoup the $12 million already spent implementing the open gTLD system.

The fees will probably decline in time, and smaller businesses will then be able to obtain their own gTLDs. Lower fees, however, will carry a downside as well. There may emerge the kind of frenzied speculation for gTLDs that occurred in the 1990s in connection with domain names. In addition, abusers of the current Internet domain-name regime will be able translate their illicit behavior to the new gTLD space.

Cost Will Prevent Misuse

For so long as the fees for a gTLD application remain high, however, there should be few abuses occurring, such as cybersquatting, typosquatting and domain tasting.

Typosquatters register misspellings of popular domain names as their own domain names. Web users who expect to land on the popular domain name's Web site, but who unintentionally misspell the domain name, are directed instead to the typosquatter's Web site. Undoubtedly, the somewhat greater complexity of domain names in which both the gTLD and the sub-domain are less familiar than “.com” will lead to a greater number of mistyped domain names, benefiting typosquatters.

Domain name tasting takes advantage of the five-day trial period that a registrant of a new domain name receives. During the five-day trial period, the prospective registrant can test the domain name for its profitability on a pay-per-click basis. If profitable, the tester simply retains the domain name. If not profitable, the tester relinquishes the domain name at the end of the five days and receives a full refund of the registration fee.

This inventory of potential ways in which gTLDs can be misused underscores the need for gTLD owners to obtain a trademark or service mark registration for their gTLD from at least one national trademark office, such as the U.S. Patent and Trademark Office. A registration serves as a governmental imprimatur of a trademark owner's claim to rights embodied in a registration. It carries considerable weight in dispute resolution proceedings against Internet abusers of the registered mark.

The appeal to businesses of owning their own gTLDs lies in the ability it provides to use the company name or one of their brands in place of .com or .net. If Amazon.com, for instance, were to obtain .amazon as its gTLD, it could use the sub-domain portion of the .amazon gTLD as a directory to its Web site. The domain names book.amazon and dvd.amazon, for example, could direct Web browsers to the book and DVD sections of its Web site, respectively.

Improved Search Results

Ownership of a popular gTLD could also benefit the placement in search results of Web sites operated under the gTLD. A search engine's algorithm might weigh the number of hits that a gTLD receives in its assessment of the relevance of a Web site to a query.

Marketers may find that a gTLD permits greater emphasis of a name or brand. Businesses that own their own gTLDs will be able to identify all of their business functions under a single gTLD. Additionally, in the sub-domain portion, a business will be able to customize content for its community, such as for employees, vendors, customers and the like.

Owners of gTLDs will also have greater assurance that security measures for the gTLD are adequate. They will have complete control over those safeguards in place for protecting against Internet threats.

The availability of new gTLDs, may also offer the chance to obtain a gTLD to those who were foreclosed from registering a name or mark under the .com gTLD.

Registering a New Domain

In October, ICANN issued a draft manual of procedure for processing gTLD applications.

ICANN is expected to open a 45-day window in the first quarter of this year for submitting applications for gTLDs. The first round of gTLD registrations are expected to be granted in the second quarter. Individuals are not eligible to own gTLDs.

Processing of an application for a new gTLD will begin with a comparison of the applied for gTLD with other applications and registrations. The comparison will be conducted by both a computer algorithm and by a human.

The applicant itself will also be assessed. A successful applicant for a gTLD must show that it has the financial, technical and operational capability to deploy a gTLD. An entity that meets these requirements and obtains its own gTLD is referred to as a registry. As a registry, the owner of a gTLD oversees the maintenance of the authoritative master database of all domain names registered under the registry's gTLD. A registry is also responsible for ensuring that computers anywhere in the world can route traffic to and from the registry's gTLD.

The U.S.-based company VeriSign Inc., for instance, is the registry for .com.

The gTLDs granted under the new policy will fall into one of two categories: “open” and “community-based.” Open gTLDs will be available for any purpose. Community-based gTLDs will be operated only for the benefit of groups, consisting of a defined community with a restricted population. To qualify for a community gTLD, the community must be clearly identified and organized in an established community; the gTLD must be endorsed by the community; there must be a connection between the gTLD and the community; and the applicant for the gTLD must establish a registration and use policy.

Geographical gTLDs include any word or combination of letters that represent a country or territory name; a subnational jurisdiction such as a county, province or state; a city name; or a continent or any U.N. region. Geographical name gTLDs permit a Web user to narrow his or her search results for a particular product or service to a locality of interest.

Geographical names or abbreviations, such as .london, .philly, and .dc are likely to face strong demand from applicants. ICANN intends to resolve competing claims for geographical names by requiring each applicant to prove its authorization to register the geographical name as a gTLD. Applicants will need to show support, or at least the absence of an objection by the relevant government or public authority, for the name.

Not Universally Welcomed

This change to an unlimited number of gTLDs is not universally applauded. For some, the new gTLDs may simply add to the difficulty of browsing the Web. They may more easily remember a domain name under the familiar .com or .net gTLDs than under a welter of different gTLDs.

Additionally, a .com gTLD is more likely to land a user directly on a home page, while a gTLD and its sub-domain name may lead to an internal page of a Web site which the Web user did not intend to visit.

The potentially limitless number of gTLDs will also hobble the ability of trademark owners to pre-emptively register domain names, in order to deny them to cybersquatters. Under the current scheme where there is only a limited number of gTLDs, a trademark owner can register an important trademark across the major gTLDs. For example, Acme Tools might pre-emptively register acmetools.com, acmetools.biz, acmetools.net and so on.

With unlimited gTLDs, pre-emptive domain name registration will be much less effective, if feasible at all. Instead, in place of across the board pre-emptive domain name registrations, trademark owners will need to systematically monitor the Web and gTLDs to detect improper use of their names and brands.

The format adopted for resolving gTLD disputes closely resembles the Uniform Dispute Resolution Policy, which is familiar to many trademark owners. Any party with standing to object, as defined by the manual of procedure, can do so. An objection can be based on a conflict with the objector's own gTLD, on a conflict with the objector's legal rights, on the grounds of morality and public order, or on the fact that a community gTLD is non-representative.

Objections based on morality and public order will inevitably lead to questions as to whose standards should apply and who has standing to raise an objection. Potential applications for .xxx as a gTLD from purveyors of adult entertainment or for .free from a Chinese democracy movement, raise standing and subject matter issues emblematic of the difficulties that enforcing the morality and public order criteria will face.

Where multiple applicants apply for an identical or similar gTLD, all applications that pass the evaluation process will be resolved by comparative evaluation or auction.

Conclusion

The availability of new gTLDs will change the way Internet traffic is managed, conflicts are processed, companies conduct their marketing and trademark owners protect their rights. Whether the value of a gTLD proves to be commensurate with its cost will remain unanswered for at least several years.