Senators asked the Internet Corporation for Assigned Names and Numbers (ICANN) to slow down the process of releasing new top-level domains today at a hearing of the U.S. Senate Committee on Commerce, Science, and Transportation. But the discussion was moot. ICANN, not under the governance of the Senate, sees it as a done deal.
Dan Jaffe, EVP of government relations for the Association of National Advertisers (ANA), told the Senate committee that brands might have to spend $2 million or more to acquire new top-level domains, or TLDs, to prevent cybersquatters from registering them.
Angela Williams, SVP and general counsel for the YMCA in the U.S., said her org already had been the victim of cybersquatting.
ICANN, the not-for-profit organization charged with handling domain-name issues, began to consider removing restrictions on gTLDs - the letters to the right of the dot Internet URLs - in 2009. New gTLDs could be anything from a product category, such as .hotel, to a brand name, such as .coke.
But the ANA and other organizations complain that companies would be forced to undergo additional expense to defend their trademarks, while consumers would be confused about whether, for example, web addresses ending in .coke really were managed by Coca Cola.
Yesterday, Rod Beckstrom, ICANN CEO, warned companies they needed to prepare for the introduction of the new generic Top Level Domains (gTLDs). In an ICANN press release, he said, “Time is short. If you have not done so, now is the time to get expert advice and get your marketing people engaged to take advantage of new opportunities... If you do not choose to apply, you should still pay attention to those who do, and use the protections built into the program to safeguard your brand or community.”
ICANN has said that its decision is the result of months of meetings and deliberation by all stakeholders.
Jaffe, testifying on behalf of the ANA and the Coalition for Responsible Internet Domain Oversight (CRIDO), a coalition of 154 national and international companies and trade associations, complained that ICANN had ignored 12 recommendations made by law enforcement and asked, "If all these groups feel so strongly, where is this consensus?"
Venture capitalist Esther Dyson, ICANN's original chair, said, "Generic TLDs create opportunities for entrepreneurs but not for the economy. It's a big waste." For example, she said, "Either Marriott.com and Marriott.hotel are the same, in which case they're redundant. Or they're different, in which case it's confusing -- without adding any extra value, because there's only one Marriott."
ICANN SVP Kurt Pritz told the committee that if two different entities want to register the same gTLD, they will be encouraged to work it out between themselves, instead of auctioning the gTLD to the highest bidder. He pointed out that the $185,000 registration fee and other requirements will keep unqualified registrars out of the game, and added that ICANN will renegotiate its contracts with domain name registrars to include as many of the law enforcement recommendations as feasible.
"If they can't take care of cybersquatting now, how will they be able to with thousands more top-level domains?" Jaffe retorted. "Every top-level domain generates thousands and hundreds of thousands of defensive domain registrations. Companies will have to buy their names back from cybersquatters or buy a top-level domain. We're talking about billions of dollars here."
Dyson added, "With new TLDs, there will be even less oversight, because ICANN is already stretched."
Pritz denied there would be a dramatic increase in the need for defensive registrations. He said the ICANN plan includes trademark protections that will let brands protect their names, a rapid take-down system, and a post-delegation dispute resolution process where trademark owners can go after registrars who abuse their trademarks.
Minnesota Senator Amy Klobuchar asked, "Who is really pushing for this?"
According to .NXT, an information service covering internet governance and policy, only seven brands have so far submitted applications for new extensions, including Deloitte, Aigo Digital Technology and Canon.
Pritz responded that the decision is the result of "a consensus-based process."
Acknowledging that the Senate had no authority over ICANN, committee members pled for putting on the brakes. ICANN plans to begin selling gTLDs on January 12.
When Klobuchar mentioned a 2010 study that showed that a slower rollout might address the concerns of businesses and advertisers, Pritz reiterated ICANN's schedule. "The application window will open on January 12 and close on April 12," he said. "We are committed to evaluating the process after the initial round."
He added that, in two previous times that ICANN had added gTLDs, it limited the type and number, but found that the expected benefits hadn't been realized.
West Virginia Senator Jay Rockefeller was conciliatory, acknowledging that ICANN had gone through a lengthy process and that there were opportunities, as well as challenges. He said, "I hope we can phase the expansion over time and not be regretful it was done too hastily."
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Susan Kuchinskas has covered interactive advertising since its invention. The former staff writer for Adweek, Business 2.0, and M-Business covers technology, business and culture from Berkeley, CA.
March 19, 2014