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On September 11, 2014, ICANN released an updated Auction Schedule for all remaining contention sets – a situation where more than one organization applied for the same gTLD. The outcome of these ICANN Auctions affects not only the new gTLD applicants involved, but also brand owners looking to register in new gTLDs.

Because of past delays, today’s auction will be the first to settle multiple contention sets in a single round: .BUY, .TECH, and .VIP. All of these strings have multiple applicants and Google and Donuts are featured in all three. It is also the first ICANN Auction for a Latin alphabet string. Thus far, the only contention set resolved by ICANN Auction has been a Chinese IDN, which Beijing Tele-info Network Technology Co., Ltd. won out over Afilias.

The .BUY contention set in particular is a good example of how an auction winner can have a major impact on whether or not a brand owner decides to register in a new gTLD.

The .BUY contention set is between Donuts, Amazon, Google, and Famous Four Media. If Donuts were to win .BUY, brand owners concerned with defensive registrations who have purchased the Donuts DPML Block would be able to breathe easy, as the Block would cover this string. If Famous Four Media wins the contention set, most brand owners will have to proactively register domains in the string to protect their trademarks. Another scenario is if Amazon wins the auction. In its application, Amazon proposed to operate .BUY as not fully open; however, the exact registration policy has not been released. Some brand owners may be able to register in an Amazon-owned .BUY while others may not. This could have significant implications for brands’ online strategies.

As a reminder, the ICANN Auction is the resolution method of last resort. In some cases, applicants involved in a contention set have reached private deals to reach a resolution. Sometimes, especially when the applicants involved have applied for multiple gTLDs, an applicant will give up one string in exchange for keeping another. While the details of these private settlements are not made public, many of the applicants involved in the contention sets up for Auction today have been party to such settlements.

In other instances, these settlements involve paying out the “losing” applicant or applicants for sums that range from the thousands to millions of dollars.

Will the ICANN Auctions result in similar string prices? Or, will holding out for an ICANN Auction lower the sticker price? Further, will the outcome of these ICANN Auctions cause other applicants in contention sets to change course, either in favor of ICANN Auctions or against? We’ll find out soon enough!

The auction began today at 9 AM, but how long it will go is anybody’s guess – the auction is an ascending-clock model, which means that bidders must match the minimum bid for each unit of time in order to move on to the next round. The longer more than one bidder is willing to stay in the auction, the longer it will take to reach a conclusion.

 

shutterstock_130365155New gTLD registries previously on hold because of potential name collision problems are free to go live now that the New gTLD Program Committee (NGPC) has approved a framework to guide them.

The NGPC Name Collision Occurrence Management Framework also frees up scores of names at high risk of collision that had been blocked at the second level for strings already in the Root Zone.

Name collision refers to the unintended consequences that may occur when a new gTLD string matches an existing string on an internal network. In other words, as new gTLDs and second-level domains go live, they could “collide” with an exact match already in use within private networks.

Readers of gtldstrategy.com will recall that ICANN has been grappling with the issue since March 2013 when Verisign warned of security concerns caused by potential name collisions. In the fall of 2013, ICANN published an initial proposal stating that two strings, .HOME and .CORP, should be deferred from delegation indefinitely, while another two dozen new gTLDs could not be categorized. Those two dozen gTLDs were effectively left in limbo with no clear path forward while ICANN deliberated a final plan. All other strings were allowed to proceed using an Alternative Path to Delegation that required registries to block a list of terms thought to be at high risk of collision at the second level.

A resolution was reached last week when ICANN adopted the mitigation plan proposed by JAS Global Advisors, an independent information security firm. The plan requires all registries that delegate after a certain date to institute a 90-day “controlled interruption” period during which technical experts will monitor the domain name environment. During that period, only NIC.TLD may be registered. Other names may be allocated but not activated.

Registries that have delegated already must also adhere to the 90-day delay but only for second-level names on their blocked lists that they wish to release. New gTLDs that have launched but registered no name other than NIC.TLD may choose to undergo the 90-day name hold period, during which all names will be on hold not just the names on their block lists. Following the 90-day period, all eligible names will be released.

Despite the “all’s cleared” sign, problems remain.

Given the likelihood of collision with internal networks, the NGPC announced that .MAIL, .HOME, and .CORP will remain indefinitely deferred from delegation. ICANN has referred these strings to the Internet Engineering Task Force (IETF) to determine the best way to handle them.

Trademark owners also face a quandary. We have seen in the past how technical issues often conflict with business considerations, and the name collision mitigation plan is another example.

Among the names on the formerly blocked lists are, by some estimates, thousands of trademarks, which in some cases, brand owners were unable to register during Sunrise periods. In some cases, registries allowed trademark owners to reserve their marks, assuming the blocked names would eventually be released. In other cases, registries offered no such service and simply held back the blocked trademarks.

Thus, in some cases, brand owners never had a chance to register their marks ahead of the general public, which means trademarked terms will be available to one and all if the brand owner doesn’t move swiftly.

Protecting brand owners throughout the new gTLD application and delegation process has always been FairWinds Partners’ priority. The ICANN community will discuss this conundrum over the coming months. FairWinds will be watching closely and working with relevant ICANN groups to help to ensure that ICANN develops a remedy that helps businesses protect their trademarks.

So you want to be a registry.

Each of the 650 applicants for new top-level domains (TLDs) took on daunting, new responsibilities when they decided to invest in the next big Internet thing. But their multi-year application process – jumping through high hoops, adjusting to the untried and unknown, and enduring multiple rule changes – may seem like duck soup compared to the challenges of running a registry.

The first thing to keep in mind is that it takes a village to raise a registry. New TLD registries will be faced with everything from the sublime to the ridiculous, from tedious tasks to complex hurdles. You and your team cannot and should not tackle the responsibility alone. Internally, successful registry operators will rely on a variety of people and departments – IT, legal, marketing, business strategy, and more – not only for their expertise but to ensure accountability for the many moving parts. Externally, registry operators will have to work with multiple vendors for technical and administrative needs.

FairWinds Partners breaks down the major responsibilities:

Administrative ServicesAt the top of this list, perhaps, is the job of ensuring the registry remains in compliance with ICANN regulations, which as most applicants know are subject to change. There will be monthly reports to file; fees will have to be paid; the registry’s credit worthiness must be kept up to date; and name collision issues will have to be tracked. These duties span a variety of professional disciplines that should be handled by the appropriate departments, or may, in some cases, be outsourced.

Coordination of Technical Partners - The registry operator must file new registrations on a weekly basis with a data escrow provider that will ensure the integrity of the TLD if the registry fails. While the back-end provider – the technical operator of the registry – creates the report, the registry operator must actually convey it to the escrow provider. The registry’s Whois information, Domain Name Service look-up, and reserved names list also will have to be maintained accurately, as will the DNS and EPP standards. Maintaining these standards will be the responsibility of the registry back-end provider. Finally, the registry operator must identify a point of contact and a process for dealing with any malicious activity that occurs within the registry’s websites.

Registration Strategy and Procedure - These should reflect your organization’s existing domain name strategy. Your registration strategy will be based on your Registry/Registrar Agreement and will help define your relationship with your registrars, and foster an understanding of their pricing, registration policies, reserved names, and audits. To a closed .BRAND registry, many of these tasks may seem unnecessary. They’re not. Each task will help registry operators articulate a clear purpose and mandate for their registries: Who may register? Which names are reserved for the registry? What are the costs of registration? And what sort of registration guidelines should be imposed?

Rights Protection Mechanisms – A number of processes are available to protect trademark holders and the general community, and registries must be familiar with each one in the event their practices are challenged. The Trademark Clearinghouse is the most fundamental rights protection mechanism, and comes into play for every registry during TLD sunrise periods, when trademark holders get the first shot at registrations. Other protection mechanisms include the registry-restriction dispute resolution procedure, the trademark post-delegation dispute resolution procedure, Public Interest Commitment dispute resolution procedure, and Uniform Rapid Suspension. Each of these procedures has its own set of guidelines and requirements that registries must learn in case a dispute arises.

Running a registry is a big job, and while many of these responsibilities can be outsourced, a registry operator will need on-staff employees to direct, oversee, or assist in the running of the registry. At a minimum a registry needs its own legal, IT, and digital strategy teams involved at some level.

Operating their own registries may be an unnerving experience for many owners of new top-level domains. That’s why it’s important to involve other departments and colleagues. There is safety – and value – in numbers.

Teamwork building process with cogs for blog on running a registry.

 

 

ClosedSignAs the New gTLD Program has rolled out over the course of the past few years, the Internet Corporation for Assigned Names and Numbers (ICANN) has made a number of program changes along the way. One of these changes disallows closed, generic gTLD applications, such as Amazon’s application for .BOOK.

Now, applicants for closed generics must decide how to proceed: whether to open their generic strings to the public, limit registrations to a defined portion of the public, withdraw the application, or sell it.

While some applicants for closed generics are already considering selling their strings to operators more experienced in running open registries, others are weighing the costs of revising their original business plans and operating restricted registries.

Despite the added work involved, this middle ground can provide as valuable a platform for innovation as closed and open registries.

The Internet Corporation for Assigned Names and Numbers (ICANN), which oversees the New gTLD Program, announced the prohibition against closed generic gTLDs last October. Earlier in the year, ICANN’s Governmental Advisory Committee (GAC) had identified over 100 generic strings that it said were contrary to the public interest. The ICANN board endorsed the GAC advice but noted it would not apply if an applicant could demonstrate the closed registry would serve the public interest.

A restricted gTLD won’t be the same as one populated by a single-registrant, speaking with one voice. But nor will it dilute the registry operator’s central message, purpose, or intention, the way an open generic might.

The traditional gTLD space is filled with successful restricted registries — .GOV and .EDU are the most prominent examples — so ICANN’s decision doesn’t have to be the death knell for applicants of closed generics. Those applicants can still build an intuitive and meaningful restricted namespace.

The most obvious benefit of operating a restricted registry, as is the case with an open registry, is the potential for profit, though registries will have to carefully weigh potential profits against the cost of running the registry. Of course, determining the potential profitability of a registry is exceedingly difficult, as the market changes constantly. But applicants can take a number of steps to increase their chances of financial success.

Restricted registries can take advantage of options available to all applicants to strengthen their exclusivity. They may, for example, reserve up to 100 names for promotional purposes before going live. They also may reserve any number of second-level domains as “premium names,” which can be sold at higher prices, adding to the proprietary nature of the string.

Operators of restricted registries also must work closely with their registrars to enforce the restrictions they impose. Without enforcement, the restrictions will be meaningless. And the registry operator must understand that a restricted gTLD may not discriminate against otherwise eligible registrants, such as competitors.

The Registry Agreement and Registry-Registrar Agreement are the primary places a registry must clarify its new policies as an open or restricted registry. Clarifications must also be made to the Acceptable Use and Takedown policies.

A registry that makes the necessary adjustments to run a restricted generic may reap the benefits, despite having had to abandon its original plan and adopt a new one. As with other types of gTLDs, association with a successful new string can open new avenues for extending a brand, supporting new business models, and creating unique marketing opportunities.

If a new gTLD is well maintained and provides high-quality, relevant content, the operator of that space may be viewed as a trusted, reliable, and useful source of information, which in turn creates demand, and thus profit.

 

Among those looking for answers at ICANN’s March meeting in Singapore will be new generic top-level domain (gTLD) applicants who haven’t yet found a path to delegation due to potential name collisions. No longer is the issue of name collisions merely technical. Over the course of almost a year, it has evolved into a potential business and financial roadblock.

Name collision refers to the confusion that may occur when a new gTLD string exactly matches an existing string used on an internal network. So, as new gTLDs enter the root zone, they can potentially “collide” with existing names. Name collision is a problem in current gTLDs too, but has taken on greater significance because of the exponential number and types of strings involved in the New gTLD Program.

The issue first took hold in late March 2013 when Verisign produced an incisive report (pdf) laying out a number of possible security concerns. At first, the report seemed quite damning. Upon closer examination, it became clear that ICANN’s Security and Stability Advisory Committee had already addressed many of Verisign’s concerns. Nevertheless a community-wide conversation was launched and the search for solutions began.

ICANN hired an independent agency to audit the root zone through the “Day in the Life of the Internet” (DITL) project to gain insight into the breadth and depth of potential collisions. The DITL data lists every domain name queried at the root zone over the course of 48 hours each year for a number of years. The domain names ending in new gTLDs were pulled from this list to determine which strings got the most hits. But the audit offered scant data aside from the simple list of colliding domains. These lists are the basis of the mitigation plan in place today.

Each path forward, however, has far-reaching and highly variable implications.

The majority of strings will follow the “alternative path to delegation,” which requires applicants to block every domain on their string’s list of DITL data before they launch. Once ICANN has the time and resources to investigate the blocked names, it might unblock those it thinks will cause no trouble. This path is the easiest and quickest for applicants, especially those with fewer than 100 names on their list.

For those strings with hundreds of thousands of names on their list, the solution is more complicated since inevitably the list will contain high value terms. So what has been a technical issue for some applicants becomes a strategic issue for others.

If corporate applicants cannot register names such as help.BRAND or buy.BRAND for an unknown period of time, their new gTLD business plans could be seriously impacted. How long will these names be blacklisted? Could they be blacklisted forever? What do competitors’ lists look like? ICANN’s timeline for digging deeper into the DITL data and creating thorough recommendations for each term on a string’s list could be critical to many gTLD marketing and use strategies.

Finally, applicants for 25 strings, including .BOX, .CASA and .FAMILY, are unable to use the alternative path to delegation not because they have lengthy lists of domains to block but because their lists are dynamic, with a high rate of change from one year of DITL data to the next. This is the group of applicants that must wait until the next ICANN public meeting to find out how ICANN will go about developing a mitigation plan and how long it will take.

While it is unlikely this group’s Name Collision mitigation will stall applications for more than a few months, once again, a technical issue has become something much bigger with serious financial and strategic implications.

Name Collision is a sticky business, and opinions vary on the impact it will have on new gTLDs and legacy websites. But for many applicants, the constant chatter about technical issues pales in importance to business and commercial considerations.